How Value-Based Purchasing Program Design Influences Outcomes

Payers should consider program design intensity when implementing value-based purchasing contracts, as higher-intensity programs can lead to better care quality and greater spending reductions, a systematic review published in Health Affairs found.

Value-based purchasing programs can incorporate both financial and non-financial features. Financial aspects include bonuses, penalties, and financial risk-sharing arrangements.

Non-financial aspects aim to help providers respond to the spending and quality incentives in a VBP program. These include analyzed data, reports, or lists; technical assistance through leadership or change management training, infrastructure payments to add more staff; raw claims data; risk-management support; and care management support.

Different combinations of financial and non-financial supports can lead to varying levels of program intensity.

Researchers conducted a systematic review of value-based purchasing programs to assess how program intensity was associated with quality and spending outcomes.

The review identified 24 value-based purchasing programs that incentivized spending reduction and quality improvement. Nearly 70 publications evaluated the programs; all 24 programs were assessed for their impact on quality, while 22 programs were evaluated for their effect on spending. Medicaid sponsored two programs, six were led by commercial health plans, eight were led by all- or multi-payer groups, and another eight were sponsored by Medicare.

All of the programs published information about non-financial supports except for one. The median number of non-financial resources was four, and two programs offered all six non-financial supports. The most commonly provided non-financial resource was analyzed data or reports, while the least frequently offered supports were care management strategies.

Value-based programs sponsored by commercial payers had more non-financial aspects than those sponsored by government plans, researchers noted.

Nine value-based purchasing programs were considered higher-intensity programs and 15 were designated as lower-intensity programs.

The majority of outcomes among all of the value-based purchasing programs were mixed-positive or positive, the review found. Of 14 programs that had quality process measures evaluated, seven had a mixed-positive or positive effect. Similarly, of 17 programs with quality utilization measures assessed, 11 had mixed-positive or positive effects. Among the 19 programs in which spending reductions were evaluated, 14 led to mixed-positive or positive effects.

When comparing higher-intensity programs to lower-intensity programs, researchers found that higher-intensity programs were more often associated with positive outcomes. Higher-intensity programs were more likely to have mixed-positive or positive outcomes for quality process measures, quality utilization measures, and spending reduction measures.

Meanwhile, lower-intensity programs were more frequently associated with null effects.

The study findings revealed that non-financial supports are generally common in value-based purchasing programs and higher-intensity programs yield better outcomes.

The results may impact how payers and providers participate in value-based purchasing programs. While lower-intensity programs may increase voluntary participation and higher-intensity programs may be harder to implement, payers and providers must consider how design choices impact spending and quality outcomes. Participating in higher-intensity programs could increase providers’ motivation and ability to generate savings and quality improvements, researchers concluded.