The Medicare landscape has been undergoing a big change in the way its beneficiaries pay for the care they receive. Due to the Affordable Care Act of 2010, the American healthcare system is transitioning from the classic fee-for-service model to a value-based care program. Now, instead of hospitals and care centers getting paid for the volume of services they can provide, they are incentivized to provide the best possible care they can to their patients. 

With this shift, Centers for Medicare & Medicaid Services (CMS) are beginning to implement value-based care payment models to help ensure their beneficiaries are receiving higher quality care while keeping costs low. Patients no longer have to suffer through fragmented medical services that end up costing a fortune without any guarantee of positive health results. 

When it comes to the value-based insurance design, there is still only a small amount of data available on its effectiveness, but early signs point to positive results. While the Department of Health and Human Services (HHS) had planned to facilitate the conversion of 30% of fee-for-service (FFS) models to a value-based care model by 2016 and 50% by 2018, only 38.2% of the money flowing through the healthcare industry in 2019 flowed through some form of a value-based care model. Even still, the outlook remains positive for the future of value-based healthcare, especially for Medicare beneficiaries. 

Preventive healthcare is a major focus of the ACA – as well as for Medicare providers as a whole – and has proven to be a valuable addition to any wellness program under the value-based care model. Most insurance providers cover the basics of preventive care, such as flu shots, vaccines, and certain screenings. But providing coverage for other preventive care methods can open the door for policyholders to utilize even more value-based medical services. Offering resources, like Peerfit Move, that allow policyholders low-cost access to condition-specific content, fitness programs, and gyms can help reduce the overall cost by helping them stay active and healthy, keeping them out of hospitals in the first place.

Here is everything you need to know on how to implement value-based care models into your Medicare policies.

Value-Based Care Models

There are a few different models that organizations can use to offer value-based care to Medicare beneficiaries. The models vary in risk to the organization based on what costs they agree to share. 

Accountable Care Organizations (ACOs)

An active and coordinated network of physicians, hospitals, and other providers work together to ensure Medicare beneficiaries receive high-quality care every step of the way. Focus is put on communication to reduce the redundancy of services and increase the overall quality of care.

Bundled Payments

Care providers coordinate to create a plan to address a specific condition and make a plan to be reimbursed in a single lump-sum payment based on the predetermined expected costs of any treatments, procedures, or care settings the patient may need to undergo. Risk is higher for the providers, but so are the potential rewards of keeping costs low. 

Patient-Centered Medical Homes

By centralizing a patient’s care setting, a primary physician can ensure the best possible care with a full team of medical professionals all in one place. With all medical needs being handled in a single location by the same team of physicians, patient care is improved and costs are kept low by reducing the possibility of redundant treatments, tests, or procedures. 

Important Metrics for Value-Based Care

In order to accurately assess the value of the care received in a medical institution, CMS and other organizations have developed a number of surveys and assessments to collect standardized data across a wide variety of care settings. The assessments are designed to evaluate patient experience and provide reliable data on how patients perceive vital aspects of care they received. The surveys are publicly available and can help Medicare carriers choose the best care for their needs. 

Star Rating

The CMS Stars Quality Rating system rates care providers on a one through five-star rating on the overall consumer experience of the care. The quality of care is determined against a number of quality measures. A one-star rating would be considered significantly lower than the average, and a five-star rating would be considered significantly higher than the average quality of care. The Stars rating is a reliable indicator of other consumer experience scores listed below. 

One important aspect of the Stars rating system is the emphasis on preventative care. Staying active and fit has long been used as a form of preventative medicine. Incorporating a Medicare wellness program like Peerfit Move into a value-based care plan can benefit the Stars rating in very positive ways.


The Consumer Assessment of Healthcare Providers & Systems, or CAHPS, refers to multiple patient experience surveys. One of the assessments specifically evaluates ACOs. The CAHPS ACO survey serves as a goal for organizations to take part in the Next Generation ACO Model. The purpose of the model is to improve healthcare results while lowering costs by offering incentives, tools, and support to ACOs. By facilitating better patient engagement and care management, CAHPS compliance displays a commitment to customer experience.


The CMS and the NCQA (National Committee for Quality Assurance) developed the Healthcare Effectiveness Data and Information Set to evaluate the effectiveness of special needs programs and the customer experience. HEDIS Measures account for many notable public health issues like cancer, heart disease, and asthma. Care for older adults is a key focus of the HEDIS Score. 

HOS Score

The first patient-reported outcomes survey recognized in Medicare managed care, Health Outcomes Survey, or HOS, is a vital assessment for any provider of value-based care. Many of the measures included directly impact an organization’s Star rating. There are several other measures that don’t affect the Stars Rating but do affect the overall HOS Score. Health outcomes of value-based care are possibly the most important metric for determining a care center’s value.  Maintaining regular fitness or physical therapy routines can be a positive influence on a HOS Score. 

A Roadmap to The Future

With the HHS and CMS pushing to make value-based care a more viable option for all Medicare carriers moving forward, it is important to fully understand how scores are measured and how to increase them. Patient care is the top priority and finding high-quality care programs that actively work to keep costs low will mean more people can get the treatment they need without going into debt to do it. 

With a value-based care model, wellness benefits should start to be at the forefront of every Medicare go-to-market strategy. This approach bridges the gap that social determinants of health tend to create, which has a high impact on overall member ratings from the metrics value-based care focuses on.

Getting the most out of value-based care models often relies on compliance with the patient experience measures listed above. This is the first of a short, connected series of articles designed to dive deeper into the four scores and how incorporating certain benefits, like a fitness program or other preventative care practices into Medicare coverage, can help boost patient experience scores.

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