Value-Based Reimbursement Grows as Providers Take on More Risk

The shift towards value-based reimbursement in healthcare continued to grow in the past year, with over half of healthcare payments in 2022 being made through value-based reimbursement models. The latest data from the Health Care Payment & Learning Action Network (LAN) revealed that just 40.6 percent of payments were fee-for-service, while 18.1 percent had a link to quality and value. These models are gaining momentum, with 31.7 percent of payments coming from alternative payment models (APMs) involving both upside and downside financial risk for appropriate care. The data also demonstrated that risk-based models are on the rise, especially in Medicare Advantage, while the appetite for risk is growing across healthcare segments. The push towards value-based care, however, is still slower than expected, as providers and payers grapple with various challenges, including willingness to take on financial risk and operationalization hurdles. Despite these obstacles, there is a significant appetite for greater adoption of risk-based APMs, signaling progress towards transforming healthcare payments.