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The Risky Business of Value-Based Care in Digital Health

By Kevin Masci, Pharm D

What does the term “valued-based care” mean to you? Is it another new healthcare buzzword? Is it the truest definition of the phrase “put your money where your mouth is?”  Or does it mean something else?

Value-based care, as a concept, has been around for a very long time; it is not new. The Value Institute for Health and Care defines value in healthcare as the “measured improvement in a patient’s health outcomes for the cost of achieving that improvement.”  More simply stated, how much does it cost to improve a person’s health?

However, as time goes on, the definition, or at least the interpretation of what it means, gets increasingly more difficult to understand. The United States is one of the most developed countries in the world, yet spends more money on healthcare than any other country.

How is it that with all of this spending, technology, and research, we still produce some of the poorest overall health outcomes while spending the most money?

The Hard Truth

Although the numbers and statistics are quite baffling, the truth about healthcare in the United States is relatively simple: it’s complicated. We have a multi-payer system that oftentimes has misaligned incentives and lacks full data transparency.  On top of that, access to care can be a challenging reality for many of those who need care the most.

Moving from fee-for-service to value-based models of care delivery is no longer a nice-to-have, it is truly a must-have in today’s evolving healthcare ecosystem. We now spend $12,914 per capita on healthcare costs according to the Kaiser Family Foundation.  Although measuring success with value-based care can feel like a daunting task, at the heart of it sits a patient who is counting on all of us as providers of care to deliver and do so in a meaningful way.  Similarly, investors are listening, with $60 billion invested since 2020 in digital health.

In today’s healthcare environment, value-based care is typically assessed with payer-specific metrics such as Stars and HEDIS measures or Payer-based performance guarantees.  However, who is value-based care actually supposed to serve? Is it only valuable for Payers?  What about providers of care?  Where does the patient fit in?  Aren’t they the ultimate consumer of healthcare that we are all trying to serve?  The answer really is all of the above.

Value-based care models are meant to be value added for everyone.

As you think about coordinated care and the idea of patient centricity, outcomes are truly the result of careful collaboration and commitment from everyone involved. However, like a good Fibonacci sequence, we haven’t quite cracked the code just yet.

Since the pandemic, healthcare delivery has gotten more complicated and distributed. Patients are seeking a higher level of personalization and demand care to be delivered how and where they want it. For some this means in-person, face-to-face interactions. For others, preference is measured by accessibility in the palm of their hand. And still for others, it may be a combination of the two.

Regardless of how care is delivered, the end goal remains the same: we must develop a model that elevates the patient experience, improves patient outcomes, and lowers the total cost of care, per the guidelines of the Institute for Healthcare Improvement’s Triple Aim.

Nothing groundbreaking, however, distributing this value and incentivizing accordingly remains the challenge.

As digital healthcare becomes increasingly popular with patients, our hope for value is outpacing our ability to execute. What payment models make sense?  How do we measure value?  What are the characteristics of companies who are getting it right in this rapidly changing ecosystem? Here are four considerations for measuring value that extend beyond financial metrics in digital health products:

1. Are their solutions grounded in science?

When evaluating digital health solutions, it is important to make sure they are built on a foundation of clinical rigor and precision.

  • How many peer reviewed studies have they completed?
  • Are these studies based on clinical guidelines and best practices?
  • What accreditations do they maintain?
  • Do they operate as a HIPAA covered healthcare provider?

These are all good indicators of clinical-grade care delivery that should be taken into consideration.

2. Do they produce proven outcomes?

Many digital health solutions claim to achieve health outcomes, but do they have the data to support this? The FTC has clear standards for what constitutes a substantiated claim about a health product. The question is, does the product being considered meet those standards?  When considering value-based contract models it is important to insist on the highest gold standard metrics rooted in clinical practice guidelines and utilized by providers in the medical community.

3. Can they prove meaningful patient engagement?

“Success is not final. Failure is not fatal. It’s the courage to continue that counts.” This quote by Winston Churchill is so relevant for patients with chronic conditions.  The journey to better health and wellness is fraught with challenges and obstacles seemingly at every turn in the road.

However, for patients who are supported with coaching and education, the ability to reach the mountain top and stay there is a lot easier.

Care delivery is not meant to be episodic. It is a daily journey that must be nurtured.

Great digital health providers recognize the power in this methodology and show results through their ability to engage and inspire patients when it is needed most.  When assessing value, engagement is a powerful consideration. It should be more than just simple nudges or alerts.  It should be personalized and based on real human-led, data-driven interventions. It should be relationship based and measured accordingly.

4. Are they focused on care coordination?

Effective care delivery should be treated as a team sport. Teams that work together, leveraging each player's unique skills and talents and guided by one singular goal, are typically the teams that end up holding the trophy at the end.  Successful value-based care models recognize the importance of the healthcare team and work tirelessly to ensure everyone has access to the same playbook to execute and deliver at critical moments when it is needed most. Coordinating care and sharing information is essential to producing world-class outcomes.

For example, using continuous glucose monitoring (CGM) to recognize spikes in a patient's blood glucose levels is an important aspect of diabetes care.  But being able to then connect these data points to support coaching, education, and patient driven touchpoints with their PCP or medical home to discuss potential therapy adjustments is critical. The ability of digital health solutions to function in this manner and facilitate care coordination, while taking into account patient preference, should be non-negotiable.

Final Thoughts

The goal of value-based care transformation is to enable the healthcare system to create more value for patients. It is not easy by any means, but as Theodore Roosevelt once said, “Nothing in the world is worth having or worth doing unless it means effort, pain, difficulty.”

Are you up for the challenge? If not now, then when? How can digital health help support you and your patients? Choosing the right partner that shares a similar vision, values, and purpose often is the difference between success and failure.  Since Omada was founded in 2011, our mission has been to inspire and nurture lifelong health, one day at a time.  We start with science and insist on outcomes. There are many considerations when it comes to value-based contracting, but for those looking to assess a digital health solution based on value, don’t wait — learn more about how Omada Works Different.

This Proof Points edition was originally published on LinkedIn on 3/14/23.