Tag Archives: Value-based care


In March 2010, then President Barack Obama signed into law the Patient Protection and Affordable Care Act and ushered in the era of value-based health care. While various groups within the medical community had been pursuing this outcome for decades, the passage and enactment of the legislation greenlit the creation of regulatory infrastructure needed to promote and facilitate widespread adoption among health care providers, medical device makers and pharmaceutical firms, according to research published in the journal Current Reviews in Musculoskeletal Medicine. Experts predicted the effects of this would ripple across numerous health care-adjacent industries – most notably, the life sciences space.

Did this transformation unfold as expected? Now almost a decade removed from the signing of the ACA, it is possible to assess how the emergence of value-based care has impacted this key sector.

Grappling with operational change

In the immediate aftermath of the legislation, the Centers for Medicare and Medicaid Services swapped the volumetric provider repayment models of the past for those centered on patient outcomes. This modification incentivized hospitals to embrace value-based workflows that reduced the likelihood of readmission and eliminated unnecessary costs to patients. Businesses in the life sciences sector were ultimately forced to grapple with this transformation, as health care providers encouraged them to adopt value-based contracting practices.

The organizations that accepted this challenge made significant adjustments to their operations, incorporating evidence-gathering and patient-engagement methodologies into existing research and development processes with the intention of cultivating effective products that would bolster patient outcomes and therefore generate revenue. However, some companies in the life sciences space resisted, including pharmaceutical firms, many of which leveraged their power in the marketplace to push back against providers promoting value-based care. Just one-quarter of drug companies have adopted value-based contracting strategies, according to PricewaterhouseCoopers.

More transformation on the horizon

The value-based care transformation continues today, despite recent policy changes related to the ACA. Why? The concept works as intended. Almost 80 percent of insurance companies saw care outcomes improve between 2016 and 2018, while watching overall medical costs decrease by more than 5 percent over the same span, researchers from Change Health Care found. This is partially why 75 percent of providers are lobbying vendors in the life sciences sector and other industries to enter into value-based contracting agreements, according to Premier.

In the past, organizations in the industry may have been able to ignore these calls. However, the maturing state of value-based care and pressure from consumers is making this difficult. Here in the U.S., an estimated 80 percent of individuals using medication say pharmaceutical pricing is unreasonable, analysts for the Kaiser Family Foundation discovered. Politicians on both sides of the aisle agree and have expressed a willingness to intervene on patients’ behalf.

With this state of affairs in play, organizations in the life sciences arena would be wise to evaluate their internal workflows and move forward with modifications that prepare them for the value-based future. Here at USC Consulting Group, we have been helping businesses optimize their operations for decades, leveraging proven techniques and tools that ease change and lay the foundation for growth.

Contact us today to learn more about our work.


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