Understanding value-based health care models

March 8, 2024

Value-based health care models are a departure from the traditional fee-for-service system, focusing on delivering high-quality care while controlling costs.


These models prioritize patient outcomes and experiences, aiming to provide the best value for patients and payers. By incentivizing health care providers to deliver efficient and effective care, value-based models have the potential to transform health care delivery and improve population health outcomes.

A young health visitor explaining a senior woman how to take medicine and pills.

Data & Analytics

Data and analytics are integral to the success of value-based health care models. By harnessing the power of data, health care providers can effectively measure and improve performance, identify areas for enhancement, and make evidence-based decisions. Numerous studies have demonstrated that hospitals participating in value-based payment programs have shown improvements in quality scores, highlighting the positive impact of data-driven approaches.1

Pharmacists play a vital role in value-based health care models due to their accessibility to patients, extensive knowledge of medication therapy, and ability to provide health care services beyond medication dispensing. Pharmacists can focus their efforts on medication therapy management (MTM), chronic disease management, and preventive care and immunizations.

While the adoption of value-based payment arrangements has steadily increased, recent reports indicate a slowdown in growth. According to the Health Care Payment Learning and Action Network, the percentage of health care payments tied to value-based models experienced stagnant growth from 2021 to 2022.2

Young doctor asking senior impaired male patient in wheelchair to sign insurance policy at home. Handicapped elderly man putting his signature under surgery consent form, reading medical document

Care Coordination

Care coordination is another important component of value-based health care. A study published in the Journal of General Internal Medicine found that care coordination interventions reduced hospital admissions by 17% and emergency department visits by 7%.3 By ensuring that patients receive appropriate and timely care across different health care settings, value-based models can improve patient outcomes and reduce unnecessary health care utilization.

Patient Engagement

Value-based models prioritize and encourage patient involvement in decision-making, self-management, and adherence to treatment plans. By actively engaging patients in their own care, health care providers can foster a collaborative and empowering environment that leads to improved health outcomes and reduced health care utilization.


How can Marsh McLennan Agency help?

Marsh McLennan Agency’s team is here to help you evaluate and manage your pharmacy program. We are a trusted partner who can identify real opportunities for savings and help you make sense of your program, control your spend, and deliver savings to your organization. Learn more about how our Pharmacy Practice can provide end-to-end plan support to fit your organization’s needs.


This article was originally featured in our Rx Newsletter. Sign up to receive our quarterly newsletter emails.



  1. “Value-Based Health Care Initiatives in Practice: A systemic Review,” National Liberty of Medicine, accessed January 17, 2024, https://pubmed.ncbi.nlm.nih.gov/31098976/
  2. “Value based care growth stagnant in 2022,” Health Care Payment Learning and Action Network, accessed January 17,2024, https://hcp-lan.org/2023/12/value-based-care-growth-stagnant-in-2022/
  3. “Health Care Coordination Theoretical Frameworks: A Systematic Scoping Review to Increase Their Understanding and Use in Practice,” National Liberty of Medicine, accessed January 17, 2024, https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8423138/