Market Trends of Value-based Healthcare Services Industry
Shared Savings Segment Expects to Register a High CAGR Over the Forecast Period
- The shared saving is a value-based model that encourages a group of doctors, hospitals, and other healthcare providers to form an accountable care organization (ACO) to provide coordinated and high-quality care to their Medicare beneficiaries. This model offers a high level of financial reward as compared to other models, such as pay-for-performance models. This coordinated care guarantees that patients receive the appropriate treatment at the right moment by minimizing provider fragmentation. The Affordable Care Act established the shared savings program, which is the largest accountable care initiative and a permanent program in Medicare.
- The shared savings segment is anticipated to witness significant growth over the forecast period owing to factors such as rising government initiatives to launch new models and programs as well as the several advantages offered by the shared saving models, including minimizing needless duplication of services and eliminating medical mistakes.
- The growing initiatives to bring healthcare providers as accountable care organizations help to improve the sustainability of the Medicare program while providing Medicare patients with high-quality treatment. For instance, in January 2023, CMS launched three innovative accountable care initiatives: the Medicare Shared Savings Programme, Community Health (ACO REACH) Model, and the Kidney Care Choices (KCC) Model and Accountable Care Organisation Realising Equity, Access Model. These initiatives are expected to deliver higher-quality care to more than 13.2 million people with Medicare in 2023. Thus, such initiatives are anticipated to fuel the segment growth over the forecast period.
- Furthermore, as per the data published in the Shared Savings Program Fast Facts, in January 2023, the shared savings program has 483 ACOs and 11 million assigned beneficiaries in 2022, as compared to 477 ACOs and 10.7 million assigned beneficiaries in 2021. About 2 billion earned shared savings were recorded by CMS in the year 2021. Thus, the increasing number of ACOs in shared savings programs is anticipated to fuel segment growth.
- Therefore, owing to the aforementioned factors, the shared savings segment is expected to grow over the forecast period.
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North America is Expected to Have the Significant Market Share Over the Forecast Period
- North America is anticipated to hold a significant share of the market over the forecast period owing to factors such as the rising prevalence of chronic diseases, increasing geriatric population, and presence of well-established healthcare infrastructure, along with high healthcare spending. In addition, the presence of favorable Medicare reimbursement policies is also expected to boost the market growth in the region.
- The government's increasing focus on promoting the adoption and transformation of various fee-for-service models into value-based healthcare models is also anticipated to fuel market growth. For instance, CMS has introduced various value-based care models, such as the Medicare Shared Savings Programme, Next Generation ACO model, and Pioneer Accountable Care Organisation (ACO) model, to change how healthcare providers are compensated for the services they provide to patients. Also, in September 2021, CMS, the Department of Health and Human Services (HHS), released a rule stating the expansion of the Home Health Value-Based Purchasing (HHVBP) model to all Medicare-certified HHAs in the 50 states, territories, and the District of Columbia. The expanded model aims to increase the quality and efficiency of home health care to improve patients' experience and to address health concerns before the requirement of an emergency department visit. Thus, such government initiatives are expected to increase the adoption of value-based care models, thereby propelling market growth.
- Furthermore, the rise in healthcare expenditure in the region is expected to increase the adoption of value-based services for home healthcare, hence contributing to market growth. For instance, as per the Centers for Medicare and Medicaid Services (CMS) August 2022 update, the national health expenditure (NHE) grew 2.7% to USD 4.3 trillion in 2021, or USD 12,914 per person, which accounted for 18.3% of Gross Domestic Product (GDP) of the country. Additionally, as per the source mentioned above, medicare spending grew 8.4% to USD 900.8 billion in 2021, and Medicaid spending grew 9.2% to USD 734.0 billion in 2021.
- Moreover, the rising focus of the companies to launch various value-based services in the region is also contributing to market growth. For instance, in June 2021, Curation Health expanded its value-based services, including the Value-Based Care Strategic Planning program and Provider Incentive Management program. These new services empower providers and health plans to collaborate in value-based agreements more effectively.
- Therefore, owing to the aforementioned factors, the studied market is expected to grow over the forecast period.
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