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Healthcare organizations see greater optimism about value-based care, says KPMG poll

Yet only 10 percent have a majority of their contracts tied to value-based reimbursement such as shared savings, bundled payments or capitation.

Jeff Lagasse, Associate Editor

Healthcare organizations are much more optimistic than they were two years ago about how value-based contracts – which promote quality care and emphasize the efficiency of hospitals and other providers – would affect profits, according to a poll by audit, tax and advisory firm KPMG.

Performance-based payment models have been slowly replacing traditional fee-for-service models for some time now, and the need to make that transition is shared by all parties involved -- payers, providers and ultimately patients. 

While there are hurdles healthcare organizations have to clear to achieve success in a value-based framework, findings from a recent Global Healthcare Alliance study indicate that value-based programs are sustainable given the right governance, technology and operations.

KPMG's poll of 221 managers and executives during a June webcast found that 46 percent of healthcare organizations see improved profits from value-based contracts, compared with 23 percent when the same question was asked during a webcast two years ago. About a third of respondents in this year's webcast see value-based contracts as having a neutral impact, as opposed to one quarter in the prior survey.

A slight majority (52 percent) of respondents in the 2016 survey saw value-based contracts hurting profitability and about a third (35 percent) expected this form of reimbursement to dampen their finances when asked in 2014. In this year's survey, only 20 percent expect lower profitability.

Healthcare executives will have to focus on high quality, transparent and secure data reporting capabilities to succeed in this climate.

Value-based payments are still in the minority, though. Providers still get paid largely by the fee-for-service model that links reimbursement to activity. 

Only 10 percent of respondents said they had a majority of their contracts tied to value-based reimbursement, such as shared savings, bundled payments or capitation for a given patient population.

About 49 percent of respondents said their contracts represented a small percentage -- less than 10 percent -- of their contracts.

Government spending on healthcare through Medicare, Medicaid, Veterans Administration and other programs have been shifting to value-based payment models in an attempt to improve efficiency and tie the quality of care to payment.

Twitter: @JELagasse
Email the writer: jeff.lagasse@himssmedia.com