When insight comes too late, revenue walks out the door. Here’s how hospitals can stop leaving performance to chance and start targeting value-based contract benchmarks.
Value-based contracts aren’t forgiving
Pressures continue to mount on hospitals and providers. From razor-thin margins to tight staffing, value-based contracts are built on the premise of more for less.
Value-based care contracts reward performance across quality, efficiency and patient experience, but only if benchmarks are met. Fall short in any of these area and the penalties hit hard. However, many provider organizations don’t realize they’re underperforming until it’s too late. Why? There’s a distinct disconnect, a lack of in-the-moment, actionable insight.
Visibility gaps continue to grow. But, why? This post explores the gaps to meeting value-based contract benchmarks and what hospitals and provider networks can do to eliminate them before contract performance is affected.
You can’t fix what you can’t see
Most hospitals collect mountains of data. From claims to HER to patient experience to staffing levels to utilization statistics, lack of data isn’t the challenge. Translating that data into timely, meaningful insight creates the largest issues.
Key challenges include lagging indicators, where traditional reporting tools deliver data weeks or months after the fact, long after corrective action can be taken. Fragmented systems also contribute; quality, finance, and operations rely on different platforms with no shared view, delaying response and diffusing accountability. Limited drill-down capabilities mean many analytics platforms stop at surface-level dashboards, leaving leaders unable to answer why something is happening and no insight into what to do about it.
As a result, providers are flying blind. They don’t know where care gaps are widening, where utilization is off track or which contracts are at risk of underperformance until after the reporting deadline.
Delayed insights negatively impact revenue
Failure to meet value-based contract benchmarks doesn’t just delay bonus payments. It directly impacts revenue, contract renewals and market competitiveness.
Consider these scenarios:
- Missing readmission reduction targets by 2% leads to penalties that claw back shared savings and put Medicare contracts under review.
- A dip in patient experience scores for two quarters results in a commercial payer downgrading incentive tiers, reducing reimbursement by 5%.
- Lagging quality measure performance due to unmanaged chronic conditions causes loss of eligibility for gainshare programs, despite providing high-cost care.
These aren’t hypotheticals. They’re happening across hospitals and health systems every day. With razor-thin margins and hospitals and clinics operating in a loss position, blind spots in performance data are unaffordable.
Situational awareness drives positive change
Solving this problem isn’t about getting more data. It’s about getting the right data at the right time and turning it into decisions.
Healthcare organizations need an integrated platform that brings together utilization, quality, patient experience, cost of care and social risk factors, connecting claims, clinical and SDOH data into one system. That’s the foundation of situational awareness.
Static reports and quarterly scorecards won’t suffice. By the time a report is delivered, the performance window may already be closed. Instead, leaders require continuous monitoring of key metrics, automatic alerts when thresholds are at risk and in-platform commentary with next-step recommendations.
Surface-level dashboards will show what’s happening. But it’s not enough. Improvement is essential on understanding why, then recognizing what to do next. Modern analytics must allow users to drill from population to patient-level detail, filter by provider, diagnosis, geography, or demographic, pinpoint patterns and outliers and create and track interventions tied to performance outcomes.
Data visibility equals positive performance
When hospitals adopt a high-functioning performance platform, the results are measurable and immediate.
In 2023, the Medicare Shared Savings Program (MSSP) yielded more than $2.1 billion in net savings, the largest savings in the program’s history. ACOs in the Shared Savings Program earned shared savings payments totaling $3.1 billion, the highest since the program’s inception more than 10 years ago.
The Hospital Readmissions Reduction Program (HRRP) associates significant reductions in readmission rates. From 2012 to 2016, readmission rates declined by 3.6% for acute myocardial infarction (AMI), 3% for heart failure (HF) and 2.3% for pneumonia (PN).
These results underscore the importance of timely, actionable data in driving performance and achieving financial incentives under value-based care models.
Not all analytics platforms are created equal
Analytics should do more than report the past. They should guide the future.
Platforms like Salient Health are built with situational awareness at their core. In-the-moment data integration across clinical, claims and social determinants of health (SDOH). Intuitive drill-down capabilities that get you to the “why” and the “what next” without waiting for an analyst or IT ticket. And built-in trust and compliance across every contract, benchmark and standard.
It’s not enough to simply identify the risk. You need the infrastructure to strategize, intervene and drive results before risk becomes a financial or clinical loss.
Optimized performance requires optimized data
Success under value-based contracts isn’t simply about clinical excellence or operational effort. It’s about timing, transparency and the ability to make informed decisions quickly. That depends on the quality and accessibility of your data.
If you’re unsure which measures are slipping, if performance trends surface only after a reporting deadline or if teams across finance, quality and operations are working from disconnected sources, that’s a challenge you need to solve. Gaps like those will cost you.
Value-based success hinges on clear insight, early action and organizational alignment around the same goals. Without that, even the best of intentions will struggle to move the needle.
