Understanding Value-Based Care and Its Importance to Stakeholders in the Health Care System

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Understanding Value-Based Care and Its Importance to Stakeholders in the Health Care System

The Experience of a Community-Based, Non-Profit Health Plan


There is a transition underway in the health care system from payers reimbursing providers based on the number of services provided (known as fee-for service) to reimbursing them based on the quality of care provided (known as value-based care). This shift from “volume to value” aims to improve patient outcomes and place an emphasis on preventive care, wellness, and care coordination. This is not only significant for avoiding complex care. As we describe below, value-based care also has the potential to improve population health and advance health equity while making care and coverage more affordable.

However, the voice of the consumer and employer has been absent as value-based care arrangements have become more widely adopted. If value-based care arrangements aim to improve individual and population health, it is critical to understand the views of all affected parties.


Study findings
EmblemHealth is one of the nation’s largest community-based, nonprofit health insurers. Together with its subsidiarity ConnectiCare, the companies serve more than three million members in the tristate area.  EmblemHealth has a long history of serving union members, essential workers, and other New Yorkers in some of the most economically, racially, and ethnically diverse communities in the country, and has built strategies to meet their unique health needs. With its affiliated primary and specialty care physician practice AdvantageCare Physicians (ACPNY) and EmblemHealth Neighborhood Care centers, it addresses the medical and social care needs of underserved communities across the New York metro area.


To better understand its members’ and patients’ perspectives on value-based care, EmblemHealth conducted a national survey on consumer awareness in August 2021. Findings from this initial survey made it clear that there was still little understanding of the term “value-based care” among consumers.  Only one in four were aware of the term, and only a quarter of those were able to accurately define it. However, when provided with a definition of value-based care*, consumers supported its focus on improving quality of care and said that providers and health insurers should work together to use value-based care and communicate this message to patients.


In a follow-up study, EmblemHealth conducted another national study in 2022 on this topic with a focus on employers. Employers provide health coverage for almost half of the country and play a key role in choosing health insurance plan options for employees. That makes them an important stakeholder in this discussion. This study found that both consumers and employers were unclear on the difference between value-based care and fee-for-service payment. But when provided a definition of value-based payments, they all strongly preferred this model as the best way to provide the highest quality care that may also reduce costs.


The 2022 study also found that 60% of employers had familiarity with the term “value-based care” but only one-third could provide a definition. Small group employers had less of an understanding compared to large group employers and were more likely to be unsure of whether value-based care plays a role in the coverage they offer. Employers also emphasized the importance of quality of care and the role of insurers in providing value to their employees’ health care.


Overall, value-based care was overwhelmingly preferred to fee-for-service by both consumers and employers once definitions were provided. It’s crucial that health insurers, providers, and employers work together to educate consumers about the ways value-based care can improve health care outcomes while potentially making it more affordable. As the health care system moves away from fee-for-service to value-based care models that emphasize health equity, this collaboration and education on the difference between care models is essential.



Experience of EmblemHealth
EmblemHealth has demonstrated this commitment to collaboration and health equity in many unique ways that can serve as a model for other health care organizations. Value-based care arrangements allow health plans to properly incentivize preventive care, address population needs, and potentially reduce health care costs. EmblemHealth believes these strategies can make health care more affordable by increasing the use of lower cost preventive care and reducing hospitalizations.


As a leader in adopting value-based care arrangements, EmblemHealth and its partners, ConnectiCare and ACPNY, have already implemented numerous population-health-focused efforts to increase preventive care and improve care outcomes:

  • EmblemHealth has seen measurable success from its adoption of value-based care arrangements, leading to increases in preventive care and reductions in unnecessary hospital admissions.
  • Data from EmblemHealth commercial members in 2022 show that compared to individuals in fee-for-service arrangements, members in value-based care arrangements had:
    • 23% more adult annual visits.
    • 14% more well care child visits.
    • 18% more A1C control for patients with diabetes.
    • 75% fewer avoidable hospital admissions.
  • The immediate impact of increased preventive care access is notable, and while these arrangements aim to reduce overall health care costs, any shared savings also allow plans to innovate through partnerships with community-based organizations. These partnerships are particularly important as they help to address social determinants of health needs such as food insecurity and create incentive programs for providers based on population-level needs.
  • We also saw similar results among ConnectiCare members.
  • Compared to individuals in fee-for-service arrangements, commercial ConnectiCare members in value-based care arrangements in 2021 had:
    • 26% more wellness visits
    • 17% more breast cancer screenings
    • 19% more colorectal cancer screenings.
    • 15% fewer acute hospital admissions, 5% fewer acute hospitals days, and 25% fewer acute hospital admits.
  • Many of our over 30 ACPNY medical offices are in medically underserved areas and are co-located with our Neighborhood Care sites. There, providers can directly refer patients for follow-up care and assistance on various social of determinants of health needs, ranging from food insecurity to housing needs. More than half of ACPNY patients are attributed to a value-based payment contract through both public and private models. These models incentivize addressing gaps in care and keeping patients healthy, with shared savings reinvested in continuously improving technology, workflows, and provider education.
  • For example, through its success in the Medicare Accountable Care Organization (ACO) program, ACPNY earned shared savings each year due to higher quality scores and better care at lower costs relative to other participants. The savings was then reinvested into the practice to provide crucial primary and specialty care services across the communities it serves.

Identifying and addressing these factors before they cause complications for an individual’s health is therefore consistent with value-based care’s emphasis on prevention to improve outcomes and potentially reduce costs. That is why EmblemHealth creates programs with community partners to increase screening, referrals, and member engagement as a way to identify and address social care needs. Using advanced data collection and analysis, EmblemHealth continuously monitors quality outcomes to identify disparities among different demographic groups and put solutions in place to address them. These solutions include:

  • Provider incentives to increase screenings for social factors.
  • Community events where trained professionals offer these services at no cost to individuals throughout the communities they serve.

EmblemHealth also operates 13 Neighborhood Care facilities, many of which are co-located with ACPNY offices. At Neighborhood Care, individuals can find resources to address the factors identified during doctor visits or community events.


Moving Value-Based Care Forward
The advantages of value-based care over fee-for-service are well known by policymakers. The Centers for Medicare & Medicaid Services (CMS), the federal agency overseeing many of programs in which Americans receive health care coverage, intends for all Medicare beneficiaries and most Medicaid beneficiaries to be in an accountable care model focused on quality and cost of care. However, EmblemHealth’s research finds more work needs to be done to ensure consumers and employers are willing participants in this effort. These are some actions that can help lead to wider adoption of value-based care:

  • Health plans, providers, and other leaders should make a concerted effort to explain the difference between value-based care and fee-for-service. They should also explain how models focusing on prevention and care coordination can help improve their health while potentially making care and coverage more affordable.
  • These initiatives should explain value-based care to consumers and patients in understandable and culturally appropriate language to ensure they know how these models can help them.
  • The health care industry should also work with policymakers to ensure this collective understanding is widespread and work collaboratively on increasing health equity across our communities.

The shift from volume to value is underway. It is crucial that all stakeholders remain committed to working together to bring clarity, communication, and mutual understanding of the benefits and importance of value-based care to the health care system. EmblemHealth hopes its research can contribute to the transformative changes that are already happening and likely to increase as more consumers and employers learn more about value-based initiatives.


* We defined value-based care as: “a newer approach where health care professionals are paid for helping their patients improve their health. With a focus on areas like preventive care and managing chronic conditions, value-based care can help people stay healthier while also keeping health care costs lower.”


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