The spending on healthcare in America functioned on a model called the fee for service model. As the name indicates, it paid providers on the basis of the number of services rendered. This would include every consultation, test, scan, and so on. Unsurprisingly, it incentivized providers to focus on the number of services, as opposed to their quality. But after the pandemic, more and more people, as well as policymakers, wanted to shift to value-based payment systems. As the name indicates, it reimburses providers on the health outcomes of the patients. In other words, it gives patients value for the money spent on medical care.
Healthcare payment systems that can adapt and evolve for value-based healthcare are an immediate necessity. Providers have been reluctant to adopt this model of payment, but increasing pressure from policymakers and the American people seems like they might accelerate the switch over to value-based reimbursements. If patients feel like they can make payments using their smartphones or credit cards for the value of care received, it would definitely usher in a much-needed change in healthcare in the United States and help cut down the spending which has exceeded $4 trillion.