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Value-Based Care is a Revenue Cycle Cheat Code

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Value-based care is being hailed as the solution to the US healthcare system’s myriad problems. Value-based care focuses on proactive, preventative health measures to keep patients from getting sick in the first place. By preventing disease and identifying and treating chronic conditions in their earliest stages, the healthcare system is more effective and less expensive overall. While value-based care provides the incentives and flexibility to transform care delivery, will it alter the payment model?

When clinicians are incentivized to lift an entire community’s health, the assumption is that the financial risk will be managed across a broad base of healthy people needing less care and a small population needing more care. It ties reimbursement to the quality of care and rewards providers for efficiency and effectiveness. In a value-based care model, patients are encouraged to play a more dynamic role in their care and be involved in critical decisions.

Value-based reimbursements are calculated by using numerous quality measures and determining the overall health of populations. Unlike the traditional models, value-based care is driven by data because providers must report to payers on specific metrics and demonstrate improvement.

Value-based care does not eliminate the current roadblocks to success from the revenue cycle perspective. In fact, value-based care further puts healthcare organizations at the mercy of payers and places the onus of reporting on already taxed Data and IT departments.

Let’s look at some current roadblocks and how value-based care affects them.

Prior Authorizations

There is nothing in the value-based care model that eliminates prior authorizations. While an overall healthier population will reduce the need for treatment, this burden remains on providers and healthcare organizations to get approval before providing care. Value-based care encourages clinicians to perform preventative tests (like colonoscopies or mammograms), which would still require pre-authorizations at an outpatient hospital.


Information, education, resources, and technology are the foundation of a denials prevention strategy. In value-based care, even more pressure is placed on physicians and revenue cycle staff to deliver quality coding and clinical documentation. On top of the denials process, the staff risks losing the incentives that are part of the drivers to move to this new model.


Audits are going anywhere anytime soon. Much like denials, audits are triggered by billing discrepancies. Value-based care does not eliminate the need for coding and will likely create more bills because physicians will see patients more often in this preventative model.

Value-based care could be a great leveler. Encouraging patients to be healthy and stay healthy decreases the cost for the larger population. But it puts more power into the hands of insurers to decide what determines “value,” improvement, and how it is delivered. The farther the US healthcare system gets away from trusting physicians and specialists to use their education and knowledge to treat patients and turn over that control to insurers, the closer we get to less care for those most in need. The organizations that provide for that patient population will suffer.

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