Value-based purchasing (VBP)

The Health Care Authority (HCA) is the largest health care purchaser in the state. We purchase health care for almost 3 million Washington residents through our Apple Health (Medicaid), Public Employees Benefits Board (PEBB), and School Employees Benefits Board (SEBB) programs.

HCA is leading the effort to transform health care, helping ensure Washington residents have access to better health and better care at a lower cost. Our goal is to achieve a healthier Washington by containing costs while improving outcomes, patient and provider experience, and equity through innovative VBP strategies.

We call this effort “paying for health and value.” One way we achieve this is through value-based purchasing (VBP).

What's VBP?

VBP is a range of strategies intended to contain costs while improving outcomes by tying health care payment to care quality. Since 2016, HCA has been working to implement a OneHCA philosophy of promoting VBP across everything we do.

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OneHCA value-based purchasing strategy long description

This figure shows how all of HCA’s programs and initiatives fall under the OneHCA purchasing philosophy. An overarching blue box that says “OneHCA value-based purchasing strategy” has four branches that say “Multipayer initiatives,” “Public option,” “PEBB/SEBB,” and “Apple Health.” Each of those four branches have their own branches representing their respective programs. They are as follows:

  • Multipayer initiatives: Rural transformation (CHART), primary care transformation, and Cost Board/primary care spend
  • Public option: Cascade Select plans
  • PEBB/SEBB: MLR performance guarantees, Accountable Care Program, and Centers of Excellence
  • Apple Health: APM with FQHCs, Maternity Episode of Care, MCO withhold, and addiction recovery medical home

VBP rewards providers for health care quality, incentivizing them to focus on primary and preventive care. It also holds plans and providers accountable for providing high-quality, high-value care and a satisfying patient experience.

What's fee-for-service?

Traditional health care payment is called fee-for-service (FFS) payment. In FFS contracts, providers are paid for each patient they see and each service they provide. This means that providers receive the same pay whether or not the patient improves and regardless of the appropriateness of care. FFS payment also incentivizes seeing a high volume of patients and providing more expensive specialty services.

VBP strategies take the place of traditional FFS payment. VBP comes in many forms, and HCA uses a variety of tools and approaches to promote VBP.


We achieve a healthier Washington by:

  • Aligning Apple Health, PEBB, SEBB, and other programs to a “One HCA” purchasing philosophy.
  • Holding health care plan partners and delivery system networks accountable for providing quality and value.
  • Exercising significant oversight and quality assurance over contracting partners and implementing corrective action, if necessary.
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