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The Case for Value-Based Care in Addiction Treatment

By Anna McKean, CEO at Master Center for Addiction Medicine

Recognition of value-based care in mental health and addiction is long overdue.  A person that is seeking addiction treatment should expect improved health outcomes if they are actively engaged and invested in treatment.  Although this may seem simple and obvious, the value of treatment has not been tied to payment for addiction treatment until recently.  

21 million Americans suffer from addiction, 10% of people with addiction receive treatment.  The reason?  Addiction treatment providers cannot afford to provide comprehensive addiction treatment because there is no way to be reimbursed for the cost of treatment. The introduction of Value-Based Payments (VBP) in addiction treatment can begin to resolve this issue and align treatment providers and health plans by compensating for care that will achieve long-term recovery for patients, and at the same time, lower overall healthcare costs. 

Master Center for Addiction Medicine was founded on the principle that a continuum of care will provide the best outcomes when treating the complex disease of addiction.  Our model of care, which provides each patient with a personalized treatment plan that integrates medical stabilization, therapy, addiction psychiatry, and peer coaching was created to give our patients the best chance at long-term success in recovery.  Our challenge is that we developed the model of care before there were adequate health plan payments in place to cover the services that are required for successful addiction treatment. 

Recently, the Center for Medicaid and Medicare Services (CMS) selected Master Center as one of 61 treatment centers across the US to participate in a new 4-year Value in Treatment (ViT) Opioid Use Disorder demonstration project. The goal of the demonstration project is to increase access to opioid use disorder treatment services and to improve physical and mental health outcomes. CMS and commercial health plans are not only interested in the quality of treatment and outcomes but also seek value for the investments they make in treatment on behalf of their members. For patients that are actively engaged in addiction treatment, a lower number of ER visits and hospitalizations, as well as ongoing management of other health conditions can reduce costs. People that suffer from untreated active addiction generate healthcare costs that are significantly higher, up to 10 times more than patients that do not suffer from substance use disorder.

Value-based payment for addiction treatment has the potential to help address the addiction crisis that impacts 1 in 3 households. Addiction and overdose is the leading cause of death for adults aged 25- 45 in the US, and in Virginia, drug overdose deaths rose 42% in one year; from 1,538 in 2019 to 2,186 in 2020. Value-based payment has the potential to improve access to addiction treatment for many Americans while improving the quality of care that they receive. The need for VBP goes beyond even the direct impact on those that need treatment and the direct costs to the healthcare system. Untreated addiction generates $442 Billion in economic loss per year – 70% of which is lost productivity in the workplace.

At Master Center, we are passionate about the care we provide and strive to be an example of how high-quality, comprehensive care can improve the lives of our patients and their families. This concept of value in treatment is core to the values of Master Center as we continue to evolve the outpatient model of addiction care. Through tracking our outcomes, we know that length of engagement, level of engagement, and participation in group therapy are key to helping our patients manage this chronic disease. The benefits of this model of care cannot be overstated, for the quality of life for the patient, first and foremost, but also for the value that is created in keeping our patients healthy for the overall healthcare system and society as a whole.   

Note: When most of us think about value, we associate the concept with purchasing a consumer good, like furniture or groceries, and whether the price we pay is fair for the goods we receive.  Starting in 2006 the idea of value for patients in healthcare was introduced by Harvard health economist Michael Porter and Dr. Elizabeth Teisburg, a professor at UT Austin medical school.  The concept was simple, determining the value of any health treatment by measuring the associated improvements in health outcomes.    As simple as the ideal of value in treatment may seem, operationalizing it in our complex healthcare system has proven to be much more difficult.  Nevertheless, the Center for Medicare and Medicaid Services (CMS) championed value-based care with incentive payments starting in 2008.  Today, about 1/3 of all healthcare payments are tied to value.  More recently, there has been a movement toward value-based care in mental health and substance use disorder.