Value-Based Reimbursement Policy in Healthcare | Free Essay Example

Value-Based Reimbursement Policy in Healthcare

Words: 574
Topic: Health & Medicine


Modern healthcare administration might be requiring some serious reforms due to its occasional inefficiency and ineffectiveness. One of the critical issues to reconsider appears to be a reimbursement approach. Being relatively innovative for the healthcare, value-based reimbursement policy imposed by the Centers for Medicaid and Medicare is aimed to substitute the traditional fee-for-service reimbursement system, and the new model happens to have its strong positive features as well as some minor drawbacks.

Advantages of value-based reimbursement

It is stated that value-based reimbursement in healthcare is defined as a reimbursement system that is focused on the quality of the provided medical care. It implies that medical personnel gets paid not for the fact of treatment, but for their ability to perform their duties well and achieve intended results by effectively using their skills. In order words, payment is performed in case of a positive outcome for the patient. Therefore, doctors and nurses should be interested in supplying quality services (Gulati & Ganji, 2017). In the long run, this might result in an improvement in the health condition of the nation, among other advantages. This value-based approach has three goals to achieve. The first one is to improve the medical treatment aspects for patients. The second one is to reform the administration system in healthcare facilities. The third one is to make treatment cheaper, for instance, by avoiding unnecessary procedures. Therefore, value-based reimbursement seems to be focused not only on positive results for patients but also for the whole healthcare system. Hence, it might prevent follow-up visits and hospitalizations due to low-quality service, which could entrain a reduction in expenditures. What is more, to be able to provide quality assistance, healthcare organizations will be interested in well-trained and qualified specialists. Also, medical facilities might be willing to purchase certified equipment, which also contributes to a positive result (Poku, Behkami, & Bates, 2017). Hence, a value-based reimbursement policy might be beneficial for the segment.

Disadvantages of value-based reimbursement

Although the above-mentioned positive features prove to be encouraging, it is reasonable to outline some obvious drawbacks. Since being centered on the quality, value-based reimbursement approach does not enforce medical staff to serve patients quickly, but to devote more attention to each of them for a thorough treatment. Hence, fewer people are likely to be served a day. Or, the doctor might have to work longer hours. Otherwise, the healthcare organization might have to employ more personnel to cope with patients. Both situations require additional payments from the healthcare system. Besides, better quality implies more time. Therefore, queues might get much longer, especially in public hospitals which happen to provide healthcare to many people of different origins and status. Apart from that, healthcare organizations will have to buy expensive equipment to get enough financing from the system. Therefore, in some cases, its financial attractiveness might be doubtful. Despite this, the above-mentioned disadvantages can be found minor (Farmer & Brown, 2017).


In conclusion, it is necessary to point out that value-based reimbursement policy imposed by the Centers for Medicaid and Medicare has been aimed to substitute the traditional fee-for-service reimbursement system. This mode is likely to be considered innovative. Due to its certain orientation on quality, it has its rather significant advantages. However, there are some minor drawbacks which are necessary to be taken into account in the course of the policy implementation. On the whole, the reform might have a positive outcome for the modern healthcare administration.


Farmer, S. A., & Brown A. N. (2017). Value-based approaches for emergency care in a new era. Annals of Emergency Medicine, 69(2), 1-3.

Gulati, M. S., & Ganji, S. K. (2017). Financial and regulatory drivers in healthcare. Hospital Medicine, 5(1), 145-158.

Poku, M. K., Behkami, N. A., & Bates D. W. (2017). Patient relationship management: What the U.S. healthcare system can learn from other industries. Journal of General Internal Medicine, 32(1), 101-104.