Recent Humana Report Suggests Value-based Care Improves Costs, Outcomes 

23 Nov, 2023 F.J. Thomas


Sarasota, FL ( – In a “pay-for-performance” program or agreement, providers receive either a bonus or a penalty based on cost and outcome benchmarks that are set by a payer. Value-based payment models use quality and other measures in addition to cost to set the benchmark for providers. Especially in cases where providers have chosen to be at risk, these programs hold all healthcare providers accountable for quality of care and level of cost at a case level.

Value-based payment programs have received conflicting reviews as some surveys have shown around 68 percent of providers don’t believe these payment models have been successful for patients nor their practices. However, a RAND Health Care analysis of alternative payment models for workers compensation in California found that value-based programs showed little effect on costs, but had the potential to incentivize high-quality care for patients. 

According to Humana’s tenth annual Value-Based Care Report, value-based care models result in a better patient experience for both patients and providers. Currently, around 70 percent of Humana’s patient population is under some form of value-based care program. 

The Consumer Assessment of Healthcare Providers and Systems (CAHPS) is part of the first national publicly reported patient survey of patient’s perspectives of their health care. Humana analysts found that patients under a value-based program reported a higher CAHPS satisfactory score at 3.9 compared to a score of 3.3 for patients not under a valued-based program.

Humana analysts found that patients with complex care needs under a value-based care model had 30.1 percent fewer hospital stays, 12.7 percent fewer ER visits, and fewer 30-day readmissions compared to Medicare patients under traditional care. The analysts also found that the value-based patients had higher levels of medication adherence, and around 85 percent saw their primary care provider at least once annually, compared to 75 percent of those not under a program. 

Humana found that their value-based programs saved 23.2 percent in 2022, equating to an $8 billion savings in medical costs, compared to traditional Medicare. As an example, one study showed that Humana’s Bundled Payment program was associated with a 2.7 percent reduction in knee or hip replacement episodes, a total of $599 per case, without any changes in quality of care. Additionally, the program was associated with a 19 percent reduction in patient admissions to post-acute skilled nursing facilities (SNF), and a 79 percent increase in surgeries done at an outpatient setting, which results in lower cost. 

According to the report from Humana, because each case is benchmarked as a whole, their value-based models allow a holistic approach to management of patients. Additionally, they state physicians have access to a strong supporting care team, and access to robust detailed health data and analytics to drive improvements. 

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    About The Author

    • F.J. Thomas

      F.J. Thomas has worked in healthcare business for more than fifteen years in Tennessee. Her experience as a contract appeals analyst has given her an intimate grasp of the inner workings of both the provider and insurance world. Knowing first hand that the industry is constantly changing, she strives to find resources and information you can use.

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