The Road Towards Value-Based Care!

Are Indian care professionals ready? 

The market shift towards value-based care (VBC) presents unprecedented opportunities and challenges for the Indian Healthcare System. Today, patients are no longer interested in just spending for the services, rather they are more aware of the overall experience at the care facility and want better care outcomes!

Did you know, In a global survey by IPSOS, it was found that 49% of Indian doctors were not satisfied with the country’s health system?

Clearly, redesigning the existing healthcare platforms into value-based care would not only benefit patients but will also help to fulfil a healthcare professional’s objectives of better patient engagement and satisfying care delivery. 


From the patient’s perspective, the Indian healthcare system has always been a ‘fee for service’ model. And, probably they wouldn’t know any other way! This has resulted in a conflict of interest for the patients. Wherein, the healthcare facilities have been focused on the quantity, forgetting the quality of the service. 

With the shift in the gears towards a VBC module, it is true that patients are in for a treat, however, it will also assist care professionals to implement a continuum of care, enhancing patient experience, standardizing outcome, optimizing cost of care, and treatment delivery. 

Are we there yet? 

2019-2021 has given quite a boost to the VBC model. It is an effective recently developed model that involves outcome-based treatment payments and healthcare professionals are rewarded according to the quality of the treatment received. It was developed because of increasing healthcare expenditure, excess healthcare costs are attributed to unnecessary and inefficient services along with uncoordinated care. 

Here is a comparison chart of the traditional fee-for-service and the upcoming value-based care model (from a payment perspective): 

Parameters Fee for Service (FFS)Value-Based Care (VBC)
Relevance Traditional Healthcare modelNew-age healthcare model
RewardA quantity-based model that requires patients to pay for every service irrespective of patient satisfaction A quality-based model in which the care facility charges as per the outcomes of the treatment. 
Patient CentricityCreates a conflict of interest and medicos have to be dependent only on the number of visits, procedures, tests, treatment, etc., which may not always align with their patient health and wellness. A model that enables doctors to keep their patients at the centre of the care while enhancing patient care and engagement. 
Care Outcome Measurement No defined metrics are available, due to which often affect the doctor-patient relationship.   Reimbursements are usually linked to meeting particular performance criteria.

Different Value-Based payments models along with efficient healthcare management platforms can assist you to create simpler processes thereby reducing the cost. So as for you to keep making profits while enhancing patient engagement & satisfaction.  

Let us introduce you to different Value-Based payments methods: 

  1. Bundled payment: This module involves a single collaborated payment for all services which will allow payers to know the payment amount upfront instead of getting the final bill at the end of a treatment course. 

Advantages: This assists the providers to benefit from the savings generated by efficiencies of the streamlined care processes and the payer would spend less. 

Financial risk: Medium to high

  1. Capitation model: Capitation is a model that pays a fixed amount to providers based on the number of patients they have or see. This model allows care providers to collect a set payment per patient which are usually in the form of monthly payments. 

Advantages: Here, when the cost of the service provided is below the capped rate, providers would be rewarded. 

Financial risk: Medium to high

  1. Pay for Performance: In this module, financial incentives/disincentives are linked to the medico’s performance. That means, the bonus is awarded for exceeding a specific metric or a penalty is imposed for falling short of the threshold. 

Advantages: It usually benefits doctors in a tertiary healthcare facility, where care professionals are subjected to receive a bonus in addition to the FFS rates, according to their performance. 

Financial risk: Low to medium

  1. Patient-centred Home Care Payment: This is driven by primary care focusing on building a team of professionals – specialist doctors, medical assistants, technicians, pharmacists. 

Advantages: Such a module will reduce readmissions and emergency department visits for patients with chronic conditions. Here the provider can negotiate fees and the payment intervals.  

Financial risk: Moderate

Is India Ready to Implement Value-based Healthcare? 

The Indian Healthcare System largely operates on the FFS(fee-for-service) model and has a high OOPE (out-of-pocket-expenditure) along with inadequate infrastructure and technology support. With the low adoption rate of healthtech in the country, we might struggle to get on value-based care models, which is a need of the hour! Also, limited accessibility of electronic medical records (EMRs) suggests that we have a long way to go for becoming fully functional Value-based care! 

HArbor Says: The current system of healthcare is in ‘silos’, which makes it difficult to provide the best possible outcome at the lowest possible cost. The fragmented system is time-consuming and increases the care cost while also reducing patient satisfaction. Value-based healthcare will bring together all modalities of care delivery to create a well-coordinated ‘continuum of care’. Moreover, better healthcare models can help to achieve the virtue of implementing Value-Based Healthcare in India.