Value-based care
Value-based care (VBC) is a payment model where providers are paid for outcomes and total-cost management — through shared savings, capitation, or quality bonuses — rather than per service delivered.
- Pays for outcomes and cost management, not visit volume
- Mechanisms: quality bonuses, shared savings, capitation
- ACOs are the flagship Medicare shared-savings vehicle
- RPM and async care fit VBC economics naturally
How value-based payment works
The spectrum runs from light to full risk. Quality bonuses layer incentives onto fee-for-service. Shared-savings arrangements (the ACO model) pay providers a slice of the costs they avoid. Capitation pays a fixed amount per member per month, making the provider profitable only if the population stays healthy. Each step transfers more financial risk from payer to provider.
Why VBC matters to digital health
Continuous, data-rich care models are exactly what risk-bearing entities need: remote monitoring that catches deterioration early, async touchpoints that cost a fraction of visits, and engagement data that fee-for-service medicine never captures. Many digital health companies sell into VBC entities as cost-reduction tools — a very different pitch, and buyer, than DTC.
The honest caveat: most DTC telehealth is pure fee-for-service or cash-pay. VBC is a payer-side channel that becomes relevant when a program can prove it changes outcomes or total cost for a defined population.
Compliance handled, so you can build
Lithos runs the clinicians, pharmacies, and 50-state rules behind your care program — one API.
Frequently asked questions
Is value-based care replacing fee-for-service?
Slowly and partially — FFS still dominates, with VBC growing through Medicare programs and risk-bearing primary-care groups.
What is capitation?
Fixed payment per member per month regardless of services used — full financial risk for the population’s care.
Does VBC apply to DTC telehealth?
Rarely today — DTC runs cash-pay or FFS. VBC matters when selling into payers, employers, or risk-bearing provider groups.