Ten tips on maximizing value-based payment

By Naveed Saleh, MD, MS
Published February 7, 2022

Key Takeaways

  • Value-based payment (VBP) focuses on quality and cost containment.

  • Although the adoption of VBP is imperfect, physicians and healthcare organizations can maximize financial benefits.

  • Various strategies can be employed to optimize value-based payment including meaningful data analytics and adjusting to community needs.

Physicians who depend on reimbursement from CMS tangle with value based payment (VBP) systems, a regulatory framework intended to hold providers accountable for healthcare quality and cost. CMS promotes these systems as providing better care for individual patients, better health for populations, and lower costs compared with the traditional fee-for-service (FFS) model. 

In many ways, the passage of the Affordable Care Act kicked off and codified the transition to VBP, and for many providers, that transition has been challenging. This trend, however, is here to stay. With some tactical adjustments, clinicians can work within this emerging system to improve care and maximize remuneration.

Shortcomings with VBP

According to a Deloitte analysis, physician compensation continues to be tied to volume vs value. Substantial performance bonuses are uncommon, and most compensation is still derived from traditional sources, such as salary and FFS.

In other findings, 97% of physicians depended on fee for service (FFS) for salary, with 36% also receiving some value-based payments. Furthermore, the number of physicians who received performance bonuses of greater than 5% held steady at 23%. 

Other concerns include:

  • Half of physicians understand the costs of the treatments they choose.

  • Fewer than half adhere to clinical pathways promoted by their healthcare organizations.

  • Existing infrastructure does not support value-based care, with opportunities for efficiency and quality of care lost.

  • Data-driven tools that help physicians deliver value-based care are lacking.

How to maximize VBP

Even though VBP may be imperfect, it’s likely here to stay. Making the most out of value-based pay is multifaceted. The AAFP provides some useful insights, calling the needs for greater efficiency and effectiveness urgent.

"‘Efficiency’ is understood to mean ‘doing the thing right’ and ‘effectiveness’ means ‘doing the right thing.'"

American Academy of Family Physicians

“‘Efficiency’ is understood to mean ‘doing the thing right’ and ‘effectiveness’ means ‘doing the right thing.’ VBP is one approach to achieving a balance between efficiency and effectiveness,” they wrote.

Here are 10 tips to consider based on AAFP guidance.

  1. Remain flexible to community needs and resources. Remain dynamic when adapting to different organization models and structures.

  2. Focus on attainable improvements in clinical outcomes.

  3. Respond to the preferences of patients from different socio-cultural backgrounds. Also respond to needs, preferences, and resources of the community. Always consider healthcare disparities.

  4. Align payment models with performance measures across payers, purchasers, and patients.

  5. Focus on reducing per-capita healthcare costs.

  6. Leverage performance measures that are evidence based and suggested by the National Quality Forum. Make sure that these measures are clinically relevant and consistent across stakeholders.

  7. Make multidimensional assessments of quality and cost.

  8. Make decisions based on data that is timely, accurate, and transparent.

  9. Assess provider capacity and tolerability for performance risk.

  10. Understand the tradeoffs of value decisions.

An article in Becker’s Hospital Review examines how practices can make the most of VPB.

  1. Identify the components of the practice that are VBP and FFS and strategize accordingly.

  2. Make long-term goals that plan around infrastructure needs to maximize VBP. Additionally, plan how to use resources derived from VBP performance success.

  3. Transform infrastructure to maximize gains from VBP. This step could mean taking a team-based approach to care that decreases expenses. 

  4. Keep tabs on metrics with regular reporting.

What this means for you

Making the most of VBP is becoming increasingly important, despite shortcomings in adaptation and facilitation of this model. There are various strategies to cut costs while providing improved outcomes. Some of these tips are geared toward the practitioner, while others are aimed at the practice and administration.


  1. Equipping Physicians for Value-Based Care. Deloitte.

  2. Value-Based Payment. AAFP.

  3. 5 steps to improve margin via value-based payment. Becker’s Hospital Review.

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