Statement of the Problem: Health Reform, Value-Based Purchasing, Alternative Payment Strategies, and Children and Youth with Special Health Care Needs

With the increasing emphasis on value-based purchasing (VBP), policymakers must critically analyze the potential impact for children and youth with special health care needs (CYSHCN), because this group of children, by definition, uses more health care services than other children and inevitably incurs higher per person costs. We provide a history and definition of VBP and insurance design, noting its origin in employer-sponsored health insurance, and discuss various financing and payment strategies that may be pursued under a VBP framework. The relevance of these approaches for CYSHCN is discussed, and recommendations for next steps are provided. There is considerable work to be done if VBP strategies are to be applied to CYSHCN. Issues include the low prevalence of specific special health care need conditions, how to factor in a life course perspective, in which investments in children’s health pay off over a long period of time, the marginal savings that may or may not accrue, the increased risk of family financial hardship, and the potential to exacerbate existing inequities across race, class, ethnicity, functional status, and other social determinants of health.

This article was part of a May 2017 supplement in Pediatrics, produced by the Catalyst Center and the American Academy of Pediatrics (AAP). The Catalyst Center staff along with colleagues from the AAP presented a webinar with key highlights from each of the Pediatrics supplement papers.