Value Based Agreements Healthcare

Participants reflected on what is needed to make VBCs close to reality from the point of view of each stakeholder, pragmatic approaches to overcoming barriers for VBCs and where we can begin to make VBCs a mainstream. The link between value and bio-scientific treatments through patient outcomes is on the horizon. Drug pricing remains in the public spotlight. Companies that over-concentrate likely regulatory mandates and are now beginning the transition will be a competitive step compared to those that are lagging behind. Value-based contracts (sometimes called risk-sharing agreements or results-based contracts) are a kind of innovative payment model that brings together two important players – health organizations and biopharmaceutical manufacturers – to provide medicines to patients. In value-based contracts, biopharmaceutical manufacturers and payers agree to link coverage and reimbursement levels to the efficacy of a drug and/or drug-rich use. Value-based contracts (VBCs) and value-based care are promising ways to accelerate the transition from volume to value in the healthcare sector. These agreements between life sciences manufacturers (pharmaceuticals and medical technology) and payers and suppliers will play a key role in providing appropriate access to new innovations and value-based care tools. They can improve patient health by spreading risks among stakeholders and helping to control costs. Drug pricing is likely to be a top priority for Congress 2019, increasing the need for companies to demonstrate value. Data analysis is an essential part of a value-based payment agreement that provides providers with a better understanding of their patients, including all interactions they have had with the health care system. In addition, data are used to determine the improvement in performance metrics.

As the number of value-based payment agreements between payers and suppliers increases, many of these relationships are structured in a way that does not encourage health improvement. Another concern is the quality measures used in value-based payment contracts. Most large payers use a standard set of quality indicators for all their value-based payment agreements, which reflect each other. Insurers say the tactic is a response to the popularity of these contracts. It is not uncommon for a provider to now have value-based care plans with all payers in their area. In the United States, there has been a lot of talk for some time about a shift from volume to value payment. Results should play a role, not the volume of services provided. Although there has been a visible shift from paid payment mechanisms to value-based payment mechanisms for medical and hospital reimbursement, it appears that each year a significant shift to value-based prices and contracts is deferred at some time in the future.