A cost-reducing reimbursement programme? Effects of value-based reimbursement on healthcare costs

Abstract

Value-based reimbursement programmes have become increasingly common in attempts to bend the cost curve of healthcare without negative effects on quality. The aim of this study was to analyse the effect of introducing a value-based reimbursement programme on the cost to third-party payer. We performed a retrospective observational study with a before and after design based on the introduction of a value-based reimbursement programme in Sweden. We analysed patient level cost data from inpatient and outpatient care of patients undergoing lumbar spine surgery, 2006-2015. The average 1-year episode cost decreased 11 percent during the first 2 years with the value-based reimbursement. The number of patients increased 22 percent during the same period, causing the total cost to increase by 8 percent. The value to third-party payer increased after the introduction of the value-based reimbursement since more patients were treated and attained a positive outcome. The decreased episode cost may be a result of better coordinated post-discharge care. Another explanation could be that costs previously borne by the third-party payer are shifted onto the healthcare providers. Thus, it is crucial that providers find a sustainable way of delivering care in the long term to retain value. Interlinking patient records facilitates a holistic perspective among healthcare providers raising awareness of health care utilization through the whole care chain.

Keywords: EQ-5D; PROM (patient reported outcome measures); bundled payment; cost; healthcare cost and resource utilization; pay-for-performance; reimbursement; value-based.

Figure 1

Illustration of the value-based reimbursement programme used in elective spine surgery in Region Stockholm (STHLM-VBRP), Sweden. Modified illustration from Eriksson et al. (24).

Figure 2

The total episode cost and number of surgically treated patients for the time period 2006–2015 in Region Stockholm.

Figure 3

The total (A) and mean (B) episode cost for surgically treated patients. The vertical line indicates the introduction of the STHLM-VBRP at the end of 2013.