Value-based contracting is an increasingly important topic for medical device companies. There's a number of reasons for that.
"Value is in the eye of the beholder".
Innovation comes at a price, one that health insurers may hesitate to pay.
Recent pharmaceutical innovations offer unprecedented possibilities for curing, treating, or preventing a range of diseases. However, patients, providers and payers alike have raised concerns about the affordability and sustainability of these drugs.
HHS Pharmaceutical Forum
For years, health insurers paid for care without regard for quality and outcomes. Recently, Medicare has begun "paying for performance" which turns out to be harder than expected.