Value-Based Care Momentum is Strong.
Technology is the Missing Link.

For health plans, value-based care is becoming a foundational model for how organizations think about improving quality while managing costs. A new survey of payer executives reveals that while value-based care adoption continues to accelerate, effective execution remains a significant challenge.

The report from Cedar Gate Technologies, an IQVIA business, based on a survey of 100 senior decision-makers from U.S. payer organizations, found that value-based payment models are gaining traction across the industry. Nearly three-quarters of health plan executives (73%) say that at least one-fifth of their provider contracts are tied to value-based payment models.

Yet despite that momentum, most organizations aren’t seeing the outcomes they expect and feel unprepared to meet the demands of a rapidly evolving healthcare industry. More than four in five payer executives (83%) say their organizations are not achieving the cost and quality results they anticipated from value-based care programs. An overwhelming majority of respondents (92%) also say that the lack of a single, connected data source is a major barrier to their ability to scale AI in value-based care.

Value-based initiatives are not going away, so how can health plans adapt to ensure they’re a benefit rather than a burden? The answer starts with technology.

Technology gaps limit value-based care performance

When asked about the obstacles standing in the way of better outcomes, payer executives pointed to several technology-related challenges.

Nearly half (47%) cited a lack of integrated analytics and care management applications, while another 47% identified poor data quality, fragmented data, or disparities across systems. Almost as many (45%) said they lack access to real-time data.

Those gaps in capabilities are having real impacts on how payer organizations are implementing value-based care models.

When asked specifically about how the lack of near-real-time data is impacting how their organizations manage value-based contracts, every executive surveyed said there were repercussions. The most common impacts include major delays or bottlenecks in managing contracts (64%), a limited ability to adjust performance throughout the year (57%), and an inability to ensure appropriate interventions for members (54%). Only 30% of respondents said their organizations can accurately forecast financial risk and model performance in alternative payment models.

This insufficient technology infrastructure is not only impacting outcomes, it is also making it more difficult to adopt new technologies that could further aid in value-based care implementation and success. Artificial intelligence has been highlighted as a critical technology for many of the noted deficiencies holding payers back — promising enhanced ability to analyze data and generate insights quickly. But for AI to measure up to the hype, organizations must first invest in a solid data infrastructure foundation. More than nine in 10 payer executives recognized that the lack of a data foundation today limits both innovation and the economic and clinical benefits AI can deliver. While AI innovation is at an all-time high, payers are also faced with the challenge of finding vendors that prioritize data excellence and governance for AI tools that will be implemented into daily workflows, knowing that poor quality data leads to low-quality AI outputs.

As David Morris, Head of Commercial, VP, at Cedar Gate notes, “The case for value-based care is evident among payer executives who are taking strides to increase and scale adoption. But when it comes to execution, many payer organizations are still behind. Those who focus investments on analytics, AI, risk modeling, and workflow integration will surge ahead because they will have tools in place that facilitate higher-quality, more targeted care and enable them to scale up value-based operations as they find the things that work for their unique member populations.”

Investment priorities are becoming clearer

The encouraging news is that payer organizations increasingly recognize where these barriers exist and where investments are needed. When asked where their organizations are investing in enabling more advanced value-based care capabilities, a majority of executives (51%) pointed to advanced analytics and predictive analytics.

Other leading investment priorities include:

• Near real-time data infrastructure (47%)
• Scalable platforms that support multiple value-based care models (45%)
• More advanced risk modeling and contracting capabilities (45%)
• Unified data platforms to improve integration and interoperability (45%)

These responses suggest that health plans are moving beyond simply expanding value-based care participation. They are increasingly focused on building the technology foundation required to make those programs successful at scale.

To explore the complete findings, download Cedar Gate’s report, The Path Forward for Payer Value-Based Care Success.