What does "value-based care" mean in health administration?

Value-based care refers to a healthcare delivery model in which providers are compensated based on the health outcomes they achieve for their patients rather than the volume of services they provide. This model emphasizes the quality of care, with the goal of improving patient health while managing costs effectively. By linking reimbursement to the effectiveness of treatment and patient satisfaction, value-based care incentivizes healthcare providers to focus on delivering higher quality care that leads to better health outcomes for patients.

In contrast to payment models based solely on the quantity of care delivered, as highlighted in one of the other choices, value-based care encourages a more holistic approach to health management. It also stands in contrast to models that prioritize cost reduction over quality, as it recognizes that investing in quality care can ultimately lead to lower costs through fewer hospitalizations and complications. Additionally, while administrative efficiency is important in any healthcare system, it does not capture the essence of value-based care, which is fundamentally centered on patient outcomes and quality.