The Evolution of Healthcare Payment Models: Transitioning to Value-Based Care
Healthcare is changing, and with the shift to a value-based care (VBC) model, health plans and state agencies must adapt, and quickly. At the same time, they’re forced to manage tightening margins alongside increasing patient needs. The traditional way of countless spreadsheets and piecemeal audits are simply not enough to tackle this shift head-on.
The good news is that in transitioning to value-based care, the future has never looked brighter.
A January 31, 2025, MGMA Stat poll found that 40% of medical practice leaders have a positive outlook for VBC in their organizations in 2025 with another 40% having a neutral outlook. In 2024 alone, Centers for Medicare & Medicaid Services (CMS) announced a record-breaking $2.1 billion in savings from the Medicare Shared Savings Program — the largest in its history.
At the same time, technology integration continues to be limited. MGMA polling from August 2024 showed limited adoption of advanced analytics or AI tools in medical groups for VBC efforts, with only 18% of groups reporting integration of these technologies.
Such a challenge needs tools specifically designed to improve contract performance while making use of population health data in a way that maximizes every dollar spent while giving people the care they deserve. Here’s how the right technology can make all the difference.
The Delicate Balance of Operational Optimization and Patient Privacy
Health plans created for value-based care must protect sensitive patient information. At the same time, organizations must be able to access relevant data in order to improve their services while leveraging the data to make decisions that are in the best interest of the patient.
For example, when a state Medicaid program expands its services, data security must be at the forefront, yet these agencies must also be able to glean insights from patient care trends. Modern analytics systems are attuned to this delicate balance and can deliver the vital information that drives positive patient outcomes without sacrificing privacy.
Improving Value-Based Contract Performance for Payors
With value-based care, success is measured in terms of how well organizations meet their performance targets in their contracts with providers. With this in mind, health plans must make sure that every dollar delivers as much value as possible.
One payor recently described the old process as “a never-ending maze” until it adopted a solution that was able to consistently monitor key performance indicators (KPIs) such as HEDIS scores or patient satisfaction ratings. This level of integrated, proactive tracking flags potential issues before they’re exacerbated into major problems, helping companies course-correct before these issues affect their overall performance.
A Focus on Payor Priorities and Population Health
Health plans and state agencies often act as the primary payors for Medicaid. As such, they’re under immense pressure to stretch every dollar while maintaining a continuously high quality of care. By incorporating tools that monitor contract performance while also providing insights and trends relevant to the local population and their health, payors can better manage their resources, negotiate smarter contract terms and improve care for members, backed by data-driven confidence.
Proactive Management and Response with Real-Time Monitoring
Payors are often forced to make quick decisions, and in doing so, need to take advantage of the most relevant and recent information possible. Today’s modern analytical platforms offer ongoing monitoring that helps health plans zero in on spending patterns and care gaps as they happen. Being proactive, rather than reactive, lets payors use each dollar more effectively, whether that means offering more targeted support to partners or deploying additional resources where needed.
Performance Tracking for Improved Planning and Communication
One of the greatest drawbacks that hinders most providers and payors is the sheer administrative burden of keeping documentation accurate while also creating a centralized source where performance information can be accessed at a moment’s notice.
To that end, implementing an automated analytics system can generate clear, easy-to-understand records of all value-based contract measures, giving payors much more than just a surface-level understanding of provider performance. With the right tools and a cohesive source for relevant data, it has never been easier for payors to plan future contracts, communicate with providers and act to minimize avoidable costs and support better health outcomes.
Go Beyond Current Performance with Predictive Insights
One of the best reasons to adopt a value-based contract management solution is to get insights about future challenges based on current data. Meeting quality and utilization targets not only drives better clinical and financial outcomes, but also allows payors and providers to better anticipate patient needs. By merging historical trends with real-time data, it’s possible to spot emerging care gaps which allows for more proactive outreach and strategic care. With this level of foresight, VBC providers can prevent the progression of debilitating diseases and chronic conditions while creating a healthier, more sustainable system.
Future-Proofing Healthcare Performance
Healthcare does not rest. And with the entrenchment of VBC, scalable, adaptable Analytics as a Service solutions are paramount to success for payors and providers. Our CoreTechs® Analytics solutions can monitor all your payment contracts with CMS HEDIS and custom measures and integrate unlimited data for real-time visibility that is essential to managing member/patient care today and in the future. Smarter spending leads to better outcomes for everyone, and having a solution in place that manages how healthcare resources are used, while focusing on contract performance and patient care outcomes, is what drives that spending.
At Gray Matter Analytics, we’re dedicated to helping payors and providers leverage advanced analytics to improve and optimize value-based contract management while helping to uncover care gaps and boost patient outcomes. If you’d like to explore how data-driven strategies can assist your organization in driving smarter, more sustainable care, we invite you to learn more and join us in this important mission.
