The Maine Health Management Coalition supports its members’ efforts
to implement Value Based Purchasing strategies. Value based purchasing
is:
The common strategy coalitions across the country are promoting and
deploying to reform the healthcare system, community by community.
A demand side strategy, involving the actions of coalitions,
employer purchasers, public sector purchasers (e.g. Medicare and
Medicaid), health plan payers, and individual consumers, to reward
excellence in health care delivery. Rewards can take three dominant
forms:
Enhanced reputation and recognition through public reporting
Enhanced payment through differential reimbursement
Enhanced market share through purchaser, payer, and/or individual consumer selection
Value based purchasing is not:
The supply side strategy of continuous quality improvement espoused by the Institute of Medicine in Crossing the Quality Chasm.
Value based purchasing is a critical external motivator in establishing a
business case for why providers of care should embrace, lead, and
implement the reengineering of healthcare delivery.
According to the National Business Coalition on Health and DHHS, the
four pillars of Value Based Purchasing must be present in a market to
allow employers to implement a Value Based Purchasing strategy. The
four pillars of Value Based Purchasing are:
Pillar One: Standardized Performance Measurement
Standardized performance measurement is the foundation upon which value
based purchasing rests. There is no capacity to reward excellence in
healthcare without first measuring performance.
Pillar Two: Transparency and Public Reporting
Standardized performance measures need to be converted into useful
information for purchasers, payers, and consumers to inform their
decision making, particularly for payment and choice. Research also
demonstrates that public reporting can be a significant external
motivator for supply side performance improvement, given the importance
of community reputation.
Pillar Three: Payment Reform
There are two critical aspects of payment reform:
The principle of differential reimbursement based on demonstrated performance;
The need to redesign payment methodology to better align economic incentives with desired outcomes.
Both elements of payment reform are needed and complementary.
Pillar Four: Informed Choice
The challenge here is to encourage demand side participants to choose
better performance at all levels of the healthcare system, thus
rewarding producers of care with increased market share.
