Value-based Health Care System

Running Head: VALUE-BASED HEALTH CARE SYSTEM 1
Value-based Health Care System
Name
Institutional Affiliation

VALE-BASED HEALTH CARE SYSTEM 2
Executive Summary
This report discusses the different facets of a value-based health care reform including its
importance and the principles to its establishment. These principles include quality in health
care, all-inclusiveness in health care, sustainable funding as well as equity. It supports
coordination and teamwork between both the Commonwealth Government, the states and the
territories in tackling issues that affect the health of the Australian people. The report also
mentions the disadvantageous health conditions of the marginalized groups in society and the
importance of improving their living and working conditions as a way of enhancing their health.
Additionally, this report discusses the demand for health care services and the elasticity of
demand for these services. It mentions that people with chronic conditions have a high demand
for health care services and that demand for these services increase with increasing age since the
healthiness of an individual deteriorates as they age. The report finally advocates for the
adoption of a value-based health care approach to solve health issues in Australia as this system
puts into consideration the costs and benefits of providing health care. It leads to provision of
care reduced costs which results in healthy individuals in the society.
Table of Contents

VALE-BASED HEALTH CARE SYSTEM 3
Table of Contents
Executive Summary.......................................................................................................................2
Table of Contents...........................................................................................................................3
Introduction....................................................................................................................................4
Guiding Principles of Value-based Reform.................................................................................5
National Health Agreement.......................................................................................................5
Quality Health Outcomes......................................................................................................5
Universal Healthcare..............................................................................................................6
Coordinated and Integrated Care.........................................................................................6
A Holistic Outlook on Health and Wellbeing......................................................................6
Innovation...............................................................................................................................7
Equity......................................................................................................................................8
Discussions and Findings..............................................................................................................8
Elasticity of Demand..................................................................................................................8
Elasticity of Supply....................................................................................................................8
Market Concentration...............................................................................................................9
Need for Volume.........................................................................................................................9
Population Demographics.........................................................................................................9
Risk Transfer............................................................................................................................10
Regulation.................................................................................................................................10
Implementation of value based Healthcare Reform.............................................................10
Demand and Need for a Value-based Healthcare System....................................................10
Sustainability................................................................................................................................11
Chronic Conditions..................................................................................................................11
Aging population......................................................................................................................12
Increasing cost of technology..................................................................................................13
Recommendations........................................................................................................................13
Conclusion....................................................................................................................................14
References.....................................................................................................................................15

VALE-BASED HEALTH CARE SYSTEM 4
Introduction
Value-based health care is a service delivery system in which care providers such as
physicians, hospitals and other parties, are paid based on the health outcomes of the patients
(Braithwaite, Skinner & Doery, 2011). This model operates in an evidence-based manner
whereby health care providers are rewarded for helping patients reduce the incidence and effects
of a chronic condition, improve their health, and live their lives in a more healthy way. It is
different from the capitated or fee-for-service system in which care providers are paid in
accordance with the amount of health care services they deliver (Marzorati & Pravettoni, 2017).
This report discusses value-based health care in all its aspects including its benefits over
traditional methodologies. It indicates how this model is dissimilar to the traditional systems of
measuring the value of health care delivered in terms of volume. Also, it covers the principles
that guide the incorporation of such a model into a health care organization. The report discusses
this system of health care delivery in relation to some fields of health care, that is, the aged
population and people who have chronic diseases. In addition, it deliberates value-based health
care in terms of the ever-increasing costs of technology, the demand for the system, the supply
chain of value-based health care, the market concentration in need of the system, the risk of
transfer to the model, the regulation of the model as well as the demographics of Australia in
relation to this model. Furthermore, the report offers general recommendations relative to the
above-mentioned aspects including the costs of health care technology, increasing chronic
conditions and addressing the aging population.