MBC Education  |   May 3, 2023  |   5 minute read

The Driver of Value-Based Care

Value-based care (VBC) has become a major topic in the behavioral health industry, as the model rapidly spreads across US health systems. If you attend almost any industry conference, presentation, or panel, you’re guaranteed to hear the term at least once.

We know that value-based healthcare is driving important change in the behavioral health industry, but how? What exactly is value-based care, and how does it impact clinicians, provider organizations, and clients?

We’ve broken down the details of value-based care, the impact it’s having across the industry, and are sharing some of our insights into how organizations are successfully transitioning to value-based care (hint: it involves Measurement-Based Care). Let’s start with the basics: What is value-based care?

Value-Based Care

Value-based care essentially refers to a shift in how services are reimbursed, ultimately pushing towards payment for services based on the quality of care delivered (as opposed to quantity). This system is designed to reward providers who deliver care that is both efficient and effective at resolving mental or physical health issues.

Now, how this operates in practice varies across payors and across states. Some of the value-based reimbursement models are based solely on the providers ability to demonstrate improved outcomes, while others will identify a range of evidence-based activities or actions that lead to efficient and effective care, and then rewards providers who utilize those activities in practice.

Value-based payment models are gaining traction in the behavioral health space and many payors are adopting it as a replacement for the typical fee-for-service (FFS) model, which reimburses providers based on the number of services or treatments provider.

The primary issue with FFS models is that it focuses on quantity of services delivered, as opposed to the quality of services — despite the fact that additional tests or sessions may not directly correlate to high quality care or improvement in outcomes. This leads to misaligned incentives and a gap between payers (who bear the risk and costs associated with a negative care outcomes) and providers (who do not).

Behavioral health value-based care incentivizes high-quality care. It functions well in combination with population health management models and has been shown to drive overall healthcare cost reductions. Brandon Fisher from Merakey explains how their organization approaches this intersectionality with value-based care.

While value-based care payments are achievable for all providers (keep reading to find out how), those that integrate behavioral healthcare alongside physical healthcare are often eligible for higher reimbursement rates than other organizations. This is largely because integrated care involves coordinating healthcare services across different providers and settings, which has been show to improve patient outcomes and reduce healthcare costs. In offering a more comprehensive and coordinated approach to care, integrated care models help drive lower hospital readmissions, a reduction in the number of tests or procedures needed, and higher overall patient satisfaction. All of this essentially means that organizations providing integrated care— like Collaborative Care Models or Behavioral Health Integration (BHI) programs under Medicaid/Medicare are better positioned to enter into value-based care contracts today and meet the quality metrics and cost targets that lead to higher reimbursement rates.

As there continues to be innovation around value-based care models in behavioral health and payors work towards expanding their reimbursement models, VBC will become more accessible to all types of organizations and providers. So, even though value-based care may not be a requirement today, what matters now is being proactive in preparing for these contracts (we cover this next).

To summarize: Value-based care models are designed to reimburse providers based on the quality of care they deliver— with the incentive being that the higher the quality of care the more the organization will be reimbursed.

But how do we measure quality of care to begin with?

Value-Based Care Needs Measurement-Based Care

Value-based care models are focused specifically on patient outcomes, where an increase in quality of care results in higher compensation for providers. This could mean that the provider has demonstrated improved outcomes in their data, or that they’ve implemented technology, added specialized staff, or taken specific evidence-based actions to improve the quality of care they’re delivering. While physical health systems have had a smoother transition to value-based care models, behavioral health has generally lagged behind. This is largely due to the fact that behavioral health hasn’t (until recently) had a clear roadmap of how to get there— for three reasons:

  1. Most organizations don’t capture clear data on outcomes. Either they’re not collecting it or they are collecting it, but it’s not being presented in a way that’s useful for reporting.
  2. There’s no consensus on which metrics should be used to measure whether clients are experiencing positive outcomes or not.
  3. By default, payors only have access to claims data and, when it comes to behavioral health, this kind of data doesn’t provide much insight into the actual quality of care.

This is where Measurement-Based Care (MBC) comes in. An effective implementation of MBC involves consistent data collection, meaning client-reported assessment collection is done at regular intervals throughout treatment (we recommend every 2-4 weeks dependent on population and program type). This data offers organizations and providers rich data to inform individual treatment plans and program improvement. Secondly, it can involve a range of measures, including patient-reported outcome measures (PROMs), therapeutic alliance measures, functioning, clinical symptoms, etc. By doing MBC well and putting clinically valuable measurement at the heart of care, you will simultaneously be generating rich outcome data that can inform whether or not care is working, and highlight areas for improvement.

Where this outcome data then becomes more useful, is in conversations with payors. As an example, Greenspace empowers clinicians and organizations with flexible and customized views of client outcome data at both the individual and aggregate level. This aggregated, organization-wide data is extremely valuable when negotiating value-based care contracts with payors, as the rich data set can highlight service effectiveness and can be tailored to the needs or requirements of both payors and providers.

When states or payors tie value-based care payments to high quality care, they are frequently looking for metrics that highlight improved outcomes. Generally, markers of high quality care that would merit higher reimbursement under value-based care might look like:

  • Lower hospitalizations rates
  • Higher symptom reduction
  • Faster symptom reduction


The connection between these markers and MBC is clear when we consider the research; MBC is shown to lead to a 3.5x higher likelihood that a client will experience reliable change, a 42% higher overall improvement in clinical symptoms, and a 40% lower dropout or cancellation rate. It can help you identify and monitor off-track clients, which can help ensure clients are never in need of rehospitalization. With MBC, not only are you implementing an evidence-based practice—which could merit higher reimbursement under value-based care on its own— you’re also now measuring the quality of care you’re delivering, a process which allows providers and their organizations to raise the quality of care they deliver— which would also drive higher reimbursement rates.

Final Thoughts

The shift to value-based care can be overwhelming for providers, especially when requirements across states or government programs can vary widely. Getting started with Measurement-Based Care allows providers to be proactive about data collection and improving outcomes for the people they serve. MBC will become a core part of value-based care in the future, so being prepared for this major transition can put providers in the right position to negotiate with payors about what measures matter under value-based payment models or to qualify for government programs as they roll out (some states like California are already taking a major step towards widespread value-based contracts in behavioral health).

Value-based care models will continue to evolve and shift overtime, especially within behavioral healthcare. MBC ensures organizations are prepared to respond and adapt to these changes, all the while improving the quality of care offered at individual clinics, and across the behavioral health system.

To learn more about Measurement-Based Care and its connection to Value-based care, visit our website for educational resources or to schedule a call with one of our implementation experts .