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Value-based Care Improves Health Outcomes, Quality, and Experience

by Jacques Boschung, President & General Manager, Payer Business, on February 3, 2021
Jacques Boschung, President & General Manager, Payer Business

Value-based care aims to reward healthcare providers based on the quality of care and services delivered rather than on quantity, with the goal of improving health outcomes, quality, and experience. Health plans, with emphasis on the accurate capture and reflection of overall member health, are uniquely positioned to support its effectiveness. As value-based care models continue to spread across the U.S. healthcare system, risk adjustment is situated to take on greater strategic importance – not solely as a payment model mechanism, but as a vehicle for reflecting a more accurate and complete picture of overall patient/member health, an input necessary for delivering and achieving value.

If you ask subject matter experts to define risk adjustment in healthcare, you will likely get a different response from each. The Centers for Medicare and Medicaid Services (CMS) defines risk adjustment as “a statistical process that takes into account the underlying health status and health spending of the enrollees in an insurance plan when looking at their healthcare outcomes or healthcare costs.” An actuary might hone in on adjusted capitation payments to payers at risk for health care costs, the vice president of risk adjustment at a health plan might emphasize accurate compensation for its clinical risk burden, and a certified coder might emphasize the accuracy of a medical record in reflecting diagnoses and procedures within a certain date of service.

All of these definitions underscore the role of accuracy – ensuring that age, demographics, and health status (i.e., risk burden) of beneficiaries are reflected accurately to CMS or state-based regulatory entities, and that the health plans managing those beneficiaries are compensated for the risk burden they bear. They also highlight that risk adjustment is not just a technical payment model mechanism, it is a foundational tool for promoting value-based care across federal and state-sponsored health insurance programs (Medicare Advantage, ACA, Managed Medicaid)1.

Under value-based care models, provider payment is linked to health outcomes, quality, and experience. Health plans are uniquely positioned to support value-based care most explicitly through risk-sharing arrangements but also by ensuring that all stakeholders, including members, have an accurate picture of their overall health. An accurate picture of member health is necessary for delivering value – offering programs and services that improve member outcomes, healthcare quality, and experience while also providing for financial viability and the planning and allocation of resources needed to deliver value. Accurate reflection of member health and overall risk burden matters and under or overestimating risk can have downstream consequences for member benefits and services, business performance, competitive positioning, and regulatory compliance.

As the U.S. healthcare system continues to expand value-based care delivery, having an effective, accurate risk adjustment program will take on greater strategic importance, particularly for health plans. However, managing a risk adjustment program is complex. Technical and regulatory requirements change often, the operational costs of building and maintaining a program internally can be prohibitive, and the overall coordination required for program execution is challenging. Health plans differ in size, scale, geography and the lines of business they serve. The ability of each to operate and maintain risk adjustment programs that deliver value to both their members and the businesses can vary greatly.

Inovalon understands the unique needs of each health plan and we are here to help. With nearly 15 years of risk score accuracy, policy and regulatory experience, and deep analytic capabilities empowered by the insights of the proprietary MORE2 Registry® – that includes more than 61 Billion medical events and 332 Million unique patients – we are a trusted risk adjustment partner. At the heart of our integrated suite of solutions, our partnership with health plans empowers compliance, Machine Learning (ML)-driven advanced analytics, and comprehensive provider and member engagement.

From Clinical Data Extraction (CDE) for automated access to clinical records to Point-of-Care and Integrated Member and Provider Outreach solutions to Risk Adjustment Data Submissions, Inovalon delivers actionable insights and measurable impact for our clients. Our solution is flexible and configurable – accessible as an end-to-end integrated risk suite or individual modules. Under either model, Inovalon ensures compliance, accurate capture and reflection of health plan members’ disease burden, and transparent and seamless operational processes for risk score accuracy.

Learn how we partner with health plans to deliver an effective, right-sized, Risk Adjustment Program today.

1 Centers for Medicare and Medicaid Services. Report to Congress: Risk Adjustment in Medicare Advantage,, 2018.
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