Study: Consumers unclear on value-based vs. fee-for-service

NEW YORK – Employers and consumers are unclear of the difference between value-based care and fee-for-service payments, but when given the definition of value-based payments, prefer it, according to a study from EmblemHealth, a nonprofit insurer.  

"The survey data and information from our research demonstrate that both employers and consumers overwhelmingly prefer value-based care to fee-for-service payment models when they better understand the differences between each model," said Karen Ignagni, CEO of EmblemHealth. "Achieving healthier outcomes more affordably will require all stakeholders to work together to educate the public on the benefits of a value-based care model." 

Key findings of the study include: 

• The concepts of value-based care and fee-for-service payments are widely unknown and misunderstood by both employers and consumers, providing an opportunity for stakeholders to collaborate on education around these concepts. 
• 60% of employers were familiar with the term "value-based care" but only one-third could provide a definition; small group employers had less of an understanding than large group employers and were more likely to be unsure of whether value-based care plays a role in the coverage they offer. 
• Only 26% of consumers surveyed had familiarity with the term "value-based care"; four out of 10 consumers were unsure whether value-based care is offered through their health plan. 
• Quality is important when defining value in health care, and employers and consumers feel health insurers and providers are most responsible for adding value to health care. 
• 42% of employers and 34% of consumers most associate quality of care received with value when thinking about health care, topping out-of-pocket cost (22% and 16%, respectively). 
• Employers felt insurers were more responsible for adding value to their employee's health care; consumers felt that providers should be more responsible for adding value (both groups placed insurers and providers at the top of their lists). 
• Given the definition of value-based and fee-for-service payment models, there is a strong alignment toward the value-based payments compared to the fee-for-service payments across both audiences.