Why is value-based payment important?

The value-based payment approach in healthcare, as the name implies, compensates clinicians for the quality of treatment they offer rather than the amount of care. In other words, the amount paid to providers is determined by the clinical outcomes of the patients. This is in contrast to the traditional fee-for-service reimbursement paradigm, in which providers are compensated based on the quantity of services they offer. Tests, scans, medications, and consultations are among the services available.

The fee-for-service approach incentivizes providers to offer more services, some of which may be unnecessary or even duplicate. As a result, the cost of care rises. The value-based paradigm, on the other hand, prioritises patient outcomes. Source: https://www.osplabs.com/healthcare-payment-system/