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Telemedicine and Value-Based Care

Posted by Michael Greiwe, MD | August 16, 2018 |
Michael Greiwe, MD



For the past decade, healthcare reimbursement models have gradually been shifting from fee-for-service to value-based care. The Center for Medicare and Medicaid Services (CMS) has been moving the needle by introducing new reimbursement programs such as the Medicare Shared Savings Program and private payers have followed suit with their own requirements for their idea of services that add value.

Generally, value-based care seeks to provide better and more proactive clinical care while cutting costs. The promise of “value” means that:

  • Hospital readmissions are reduced;
  • Technology is used effectively to improve efficiencies and reduce costs;
  • Preventative care increases;
  • Quality outcomes improve.

RevCycle Intelligence has this to say about value-based care:

The goal is straightforward but ambitious: Replace the nation’s reliance on fragmented, fee-for-service care with comprehensive, coordinated care using payment models that hold organizations accountable for cost control and quality gains.

This article will look how telemedicine fits in with value-based care and whether the technology seems to fit where healthcare seems to be heading in the future.

What is Value-Based Care?

RevCycle Intelligence defines value-based care as, “a form of reimbursement that ties payments for care delivery to the quality of care provided and rewards providers for both efficiency and effectiveness.” The most recent push to improve the efficiencies of healthcare couldn’t come at a better time; as the costs of providing healthcare to Americans continues to climb. Value-based reimbursement has been pushing clinical care providers to seek new ways to streamline efficiencies and cut costs. Interestingly, there is evidence that it seems to be working.

HIT Consultant believes the shift in provider payment structures has caused workflow changes incorporating big savings by “reducing unnecessary medical costs 5.6% on average.”

Under the Obama administration, value-based reimbursement actually expanded. In 2018, almost two-thirds of all reimbursement is tied to the concept of “value,” according to a study by Change Healthcare.

But under the new administration, Health and Human Services have expanded some and cut back on other value-based care programs. Day Health Strategies predicts that 2018 will likely see the growth of value over volume, which will drive the growth of virtual care programs, like telemedicine. However, PWC suggests the changing of the guard in the White House will shift the focus of value-based reimbursement without eliminating the concept completely.

PWC says over the past year, the federal government has:

  • Expanded value-based reimbursement under Medicare Advantage.
  • Expanded the list of exempt providers from MIPS (the Merit-based Incentive Payment System.)
  • Created new bundled payment models.

It’s clear that value-based reimbursement is a trend that we’ll see in the future, no matter what political party is in power.

Now let’s look at how value-based reimbursement fits in with telemedicine. Can providers leverage this technology to improve reimbursement under value-based care models? Many think the answer is, “Yes.”

How Does Telemedicine Fit Value-Based Care?

“With the roll-out of value-based care programs that focus on patient outcomes, health systems and health plans can also use telehealth in a proactive way, reaching out to patients facing transitions in care, closing patient gaps in care and tracking adherence for patients with chronic care management plans.”

The Pivotal Role of Telehealth in Value-Based Care Success

Becker’s Hospital Review


While telehealth models have been used frequently for low-acuity health issues in a kind of a virtual urgent care model, the technology is the perfect fit for the shift to value-based care models across the paradigm of care.

Modern Healthcare suggests that the three tenets of telemedicine, including better treatment access, reduced costs, and improving patient engagement, are all requirements under the idea of “value” in healthcare.

Becker’s says that telemedicine, which has served primarily as a reactive form of treatment, could actually serve as a hub for “informed virtual care.” The immediacy of telemedicine could allow for real-time access to pharmacy data, lab work, claims, and a patient’s medical history that could close healthcare communication gaps. Telehealth can bring providers together in new ways for care coordination, to assess patient compliance, or to simply to share information between specialists. Modern Healthcare points out that “Driving down costs can be equally as important as saving time, as in the case with post-surgery video visits.”

This makes sense in light of fee-for-service being characterized generally as creating silos of care. Telemedicine offers new ways for video to improve the efficiencies of care coordination.

From a patient perspective, the “value” in telemedicine is tied closely to convenience. When patients realize that they don’t have to travel to the physician’s office, but instead can receive a virtual house call from their doctor of choice, they actually prefer a telehealth visit. Just look at some of the statistics:

  • 64% of patients prefer to be seen by their physician on video instead of an in-person visit.
  • Of the group surveyed, 61% stated it was the convenience that attracted them to the service initially.
  • 77% of patients that have never tried telehealth would be willing to try it.

From a reimbursement perspective, the 2018 Quality Payment Program Final Rule offers two tracks for eligible clinicians to move toward value-based care with telemedicine:

  • Participation in the Quality Payment Program;
  • Participation in Alternative Payment Models.

Given that Health and Human Services has expressed their goal of transitioning 50% of Medicare reimbursements to alternative payment models this year, clinical providers that have been dragging their heels over value-based care will need to make the switch. (To read more about the link between value-based reimbursement and telehealth, see this article.)

From the perspective of the physician, telemedicine can improve their practice by providing value in the following ways:

  • Offering improved care access for remote patients.
  • Reducing clinical overhead costs.
  • Improving patient quality and satisfaction scores.

In the orthopedic practice, there is a clear value for patients. Imagine the difficulties inherent in traveling to an office in inclement weather after hip replacement for a simple recheck? Telemedicine offers these patients a way to improve not only the quality of care but the quality of their recovery. But orthopedic practices can also improve efficiencies and increase the quality of care for patients by using services like OrthoLive.



Contact us to see our telemedicine application in action.



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