communication of strategy change from the traditional FFS to VBP

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The project is concerned with the communication of a strategy shift from standard FFS to VBP in the health care industry. VBP is a system that rewards quality performance rather than just service. It recognizes the value provided by the service provider. The major aspects relevant to VBP in this scenario include the payment model, which outlines the basic payment to reward quality in service delivery. The rate setting and quality oversight models are required to assess all financial and operational aspects of the company. Finally, there are incentive and measurement methodologies that are concerned with assessing performance and evaluating all VBP incentives. For effective implantation of VBP in the next three years, finance department must direct all its spending on value to minimize costs. Quality management must ensure all operations of the organization aim at achieving implementation of VBP. Clinical practice department must work towards quality service delivery to customers. To achieve this, staff must be taken through thorough training and education regarding the benefits of the new model.

Value-Based Purchasing (VBP)


Physicians are differently motivated while offering their services. In healthcare, some are driven by an additional pay due to the quantity of care while others aim to earn rewards based on quality. Free for service (FFS) payment advocates for the unbundling of services and enhances payment of physicians based on the quantity of care. FFS is very common in the US, but because of the enormous limitations such as raise of costs and discouragement of efficiencies, some organizations are shifting to value-based purchasing (VBP). Value- based purchasing refers to a method of payment that aims at rewarding quality and effectiveness of health care service delivery rather than a traditional pay for service methodology (Houy, 2009).

Moreover, incentives are used to discourage inappropriate, unnecessary and costly care. It is an excellent program that adjusts payments under the inpatient prospective payment system. The significant share of Medicare spending in the United States that affects the payment of inpatient stays is about 3,000 hospitals. Today, quality is the greatest objective that most hospitals in nursing must embrace to enhance efficiency and further increase reimbursement from the government.

Organizational Current Status of Implementing VBP

My organization “John Hopkins psychiatric hospital," has not fully embraced VBP though there are significant improvements towards ensuring healthcare quality supersedes traditional quantity. Changes towards full embrasure of VBR are underway, and the institution aspires to edge the list of top hospitals in the US that value healthcare quality rather than quantity. However, there is an improved patient satisfaction regarding value obtained. This is a major move that is spurred by the need for more disbursement by hospitals. They also have a transparent system of storing both patient records and hospital records for ease accessibility of information. John Hopkins psychiatric hospital has structured the Medicare payments and has improved healthcare by approximately 75% including the inpatient care. One of the most remarkable achievements for this hospital is the enhancement of inpatient pay that is based on quality. However, the remaining 25% requires a progressive plan that will be referred on during the implementations. Furthermore, the progressive VBP adoption program will bolster monitoring and evaluation during the implementation stage.

Strategic plan for continuous implementation of VBP plan

Three departments that will have the most impact on VBP.

Progressing with the implementation of VBP program will significantly affect quality management, clinical practices, and hospital finance departments. Quality management department ensures that the hospital delivers preferred value to its clients. This department strategizes on how to minimize costs and maximize value. It is, therefore, indispensable as far as VBP is concerned. Clinical practices department, on the other hand, is concerned with delivering services to clients. Customers measure their satisfaction basing on how they were handled in this department regarding expertise, customer care and general administration of services. Hospital finance department handles all matters of finance acquisition and utilization. The department has to come up with ways of minimizing costs to deliver services at affordable prices to clients. The department is also involved in rewarding employees. In so doing, it has to ensure that employees are happy with their pay for quality services to be provided.

Goals of key departments in implementation of VBP

The finance department has various purposes among which are that of Strategic Budgeting. This is to ensure every department in the organization has a set target for profit goals and overhead and production costs. A closer check on this will ensure quality is enhanced leading to the implementation of VBP. Quality management goals include program administration which ensures monitoring the organization‘s compliance with the standards set by regulatory and accrediting bodies such as Centers for Medicare and Medicaid Services (Meyer et al., 2010). This, therefore, facilitates VBP implementation in ensuring the organization is committed to total quality. Finally, clinical practices department is propelled by the following goals which promote the implementation of VBP; Promoting health by properly examining, diagnosing and intervening in all aspects of illness. It also ensures that practitioners are professional, ethical and competent in carrying out their duties. Most importantly, these goals are critical in augmenting the smooth implementation of VBP (Rhew, 2012).

How the goals above will help attain quality outcomes in patient care and reimbursements.

Finance department goals

Strategic budgeting; for inpatient care, the goal aims at reduction of costs whose impact is felt by the patient regarding low pay. The goal also ensures that departments profit targets are attained. This eventually leads to value maximization which influences reimbursements. With regard to cash flow management, there is assurance of proper management of money in the organization that reduces panics and stagnation of projects in the organization. This goal ensures that all departments are adequately financed to carry out tasks in an appropriate manner. Ultimately, patients are attended to in time and efficiently since the resources needed would be available. At the same time, service providers will be sure of getting their dues.

Quality department goals

Program administration; this goal aims at ensuring compliance of the departments of the organization with regulatory bodies. It helps in ensuring ethical behavior, professionalism and quality services all of which are enjoyed by the patient. Both the employees and patients get a value as the ultimate goal.

Based on clinical practices goals

The professionalism of health practitioners; this goal ensures that all clinical service providers are competent and merited to be in that position. This is to prevent trial and error on patients. It, therefore, ensures the value for the patient. In return, since the employees are chosen on a competitive basis, they are well remunerated to keep them working enthusiastically thus boosting the confidence of implementing VBP in three years (Shoemaker, 2011).

Key points for my strategic plan critical for the staff to understand and embrace.

Key points

The staff ought to understand the mission statement which explains the existence of the organization. Another important aspect is the guiding principles which outline values of the organization. Also, there are value propositions which outline the benefit or the gap that need to fixed for both internal and external players. The fourth key point is destination point which gives a bigger picture of where the organization wants to find itself in a specified period. Lastly, there is a strategy which specifies how the organization will reach its destiny (Redwood, 2012).

Marketing the strategy to staff

A good plan if not well communicated to staff can be confusing and can face a lot of resistance from them. Therefore, for a strategic plan to be successful, a superb marketing strategy to staff is a prerequisite. To begin with, staff should be requested to attend an informational company meeting on the new plan. They should be succinctly explained to the reasons for the new strategy and why you want to do away with the former. After this, I would bring out the strategy enthusiastically and demonstrate how it is going to suit the needs of the company better. I will clearly outline the differences between the former one and the new. This will enable employees to get the benefits of the new strategy. After this stage, I will ask questions about the strategy and allow them to express their concern and try to find solutions together. Finally, I will schedule a follow-up meeting to enable them to enquire in details after they have had enough time to share among themselves. The most notable thing is to repeatedly explain the new strategy until it becomes part of them.

Reflection on how to incorporate ethical clinical and ethical business practices into the strategic plan.

Today, morality is fundamental in enhancing the integrity, competence, and transparency in organizations. Ethics significantly guides employees and the management on how to execute various roles. Again, it is critical in ensuring professionalism is upheld. In this context, ethical assertions will guide physicians and clinical officers about how to relate and offer services to patients. Moreover, the hospital will ensure only ethical practices are applied to influence customers. Therefore, this hospital can incorporate ethical clinical and ethical business practices under the element of guiding principles which outline all ethical practices that every employee must endeavor to subscribe to. They should also be incorporated in the company mission and vision statements to increase the level of compliance and paint a positive picture about the institution.

How to coordinate informational and educational events for the three departments

To effectively organize three most affected departments, the management should use apt communication channels and systems depending on the nature of the staff. Regarding informational perspective, the departments can only cooperate conflate efforts if there is clear and succinct communication of objectives. There should be a short communication structure, and that addresses issues firstly. To effectively communicate in the events, motivate the staff and use all means to promote the events. Similarly, coordination of educational events also depends on the degree of communication used. The regularity of education should be established by the human resource department, and timely communicated to the departments (Owens, 2011). As a result, all programs in the departments will smoothly be executed.

Setting Timeline for implementation of VBP in a period of three years



Hospital Value-Based Purchasing Program (Planning)

May 2017

Communication of change of strategy

Aug 2017

Piloting in key department

Jan 2018

Assessing results

May 2018

Rewarding performance

Sept 2018

Application in the whole organization

Jan 2019


Houy, M. (2009). Value-based Benefit Design: A purchaser Guide. Needham Mass: National

Business Coalition on Health.

Meyer, J., Rybowski, L., & Eichler, R. (2010). Theory and reality of value-based purchasing:

Lessons from the pioneers. Agency for Healthcare Policy and implementation

Owens, K. (2011). The HCAHPS imperative for creating a patient-centered experience.

Retrieved on May 11th, 2017, from

Redwood, S. (2012).Beyond closing the gap: an evaluation of the lecturer practitioner role.

Retrieved from

Rhew, D. (2012). Value-based purchasing: Outstanding performance is crucial. Retrieved on

May 11th, 2017 from

Shoemaker, P. (2011). How to calculate hospital performance scores under Medicare’s new VBP

program. Healthcare Financial Management. Retrieved on May 11th, 2017 from

May 10, 2023

Education Business

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Project Strategy

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