Value-based care is no longer a future state. The present rules are tightening, and the federal push is accelerating. At the RISE Value-Based Care Summit, Juliette Price, Chief Solutions Officer at HSG Global, gave Medicare, Medicare Advantage, and Medicaid leaders a clear read on where the market is heading over the next two to three years, and on what separates the organizations pulling ahead from the ones falling behind.
Where the Market Stands
After years of uncertainty, the market is settling, which gives leaders rare clarity to plan two to three years out. Nearly 45 percent of payments now flow through risk-bearing categories three and four, and 28 percent run through arrangements carrying real downside risk. Value-based care holds bipartisan federal backing, and the current administration is accelerating the push through mandatory models and downside-risk requirements.
The case for change is hard to argue with. The United States spends far more on health care than peer nations and posts worse clinical outcomes, with chronic conditions driving 80 percent of spending. Price described the system in blunt terms: “highly wasteful, highly inefficient, pretty dangerous.” The global goal stays the Quadruple Aim: better population health, a stronger patient experience, lower per capita cost, and reduced provider burnout.
Medicare Advantage Under Pressure
Medicare splits roughly 50/50 between fee-for-service and Medicare Advantage, which runs as a capitated, risk-based model. For MA plans, the math has changed. After a fourth year of elevated spending, the priority shifts from ratcheting up revenue to managing expenditures.
Price framed the turn bluntly: the days of risk adjustment until the cows come home are effectively over, with CMS now using AI to check documentation. As margins compress, providers should step up and negotiate real value-based agreements with plans rather than wait for terms to come to them.
CMMI and the Fee-for-Service Push
On the fee-for-service side, CMMI accepted 300 ACOs into the new ACO LEAD model, the replacement for ACO REACH. The model rewards work with high-needs patients through a dedicated benchmark, including patients with disabilities, and the designation stays with a patient for the rest of their time in the program. A 10-year no-rebasing policy protects efficient providers from being penalized for their own success, and the model aims to pull in specialty care, which drives roughly 70 percent of health care spend.
The administration is also closing the exits. Exceptions letting ACOs avoid downside risk are going away, backed by research showing outcomes and costs move when providers carry real risk. Mandatory models, including the TEAM model launched in January, signal where federal policy is heading.
Medicaid's Aggressive Shift
Medicaid is moving fast. States from Texas and Tennessee to California and New York are building value-based roadmaps under federal budget pressure. Recent legislation reshapes eligibility and coverage, and the projection points to far fewer people covered by Medicaid.
In the nine of ten states running managed care, insurers face heavy enrollment loss, less capitation, and a changed risk pool. As balanced pools tilt toward high-risk members, plans hold little incentive for risk adjustment and remain largely unprepared to manage the volatility.
How Outcomes Get Measured Next
Washington is rethinking how outcomes get measured. Federal discussion is moving beyond the “measurement industrial complex,” the process-heavy world of measures like HEDIS, toward results patients feel. Patient-Reported Outcome Measures are back in the policy conversation, with international frameworks like ICHOM offered as models.
Large insurers are under strain. As Pat Conway of Optum noted, employed physicians and clinicians have to align to value-based models to avoid losses. Value-based care also gives the system a faster way to catch fraud, waste, and abuse.
The Real Barriers
Culture eats strategy for breakfast, Price warned, because clinical workflows still are not built to manage patients under value. The advice on commercial insurance was direct: set commercial aside, because the model breaks before bending. Primary care providers are becoming the new attribution engine without readiness for the power shift, and primary and specialty care still operate in silos. Most hospital systems treat value-based care as a defensive play, and payer teams often run thin on value-based talent.
Whole segments get overlooked: the IDD population, maternity and women’s health, pediatrics, and home and long-term care. Price called out a lack of imagination, a tendency to recycle ideas like care management instead of thinking radically differently.
Who Comes Out Ahead
Niche providers sit in an uncertain middle. Durable medical equipment and occupational and physical therapy are positioned as supporting players rather than core risk-bearers. The smart ones are adapting: OT and PT clinicians moving into home care and virtual services, or partnering with musculoskeletal providers operating under risk. Durable medical equipment is not threatened today, but the guidance was to skate to where the puck is going, not to where the puck sits now.
The pattern is clear. The most entrepreneurial organizations are coming out as winners.
Questions Worth Carrying Forward
The evolution of value-based care rewards leaders who plan early, carry risk with confidence, and rethink the segments everyone else overlooks. Which models are you ready to take downside risk on? Where does your organization still treat value as defense rather than strategy? Which overlooked populations might become your next advantage?
The conversation continues at RISE West, where these forces move from forecast to field strategy, and the RISE community maps the next steps together.