Justice-Weighted Value-Based Payments: Embedding Ethics and Patient Agency into APM Formulas

Riegler (2023) argues that no common payment model adequately addresses distributive justice or patient autonomy. Meanwhile, VBID improves adherence but often leaves other outcomes flat (Wang et al., 2022). We propose a justice-weighted payment design: adjust bonuses/penalties by social risk (e.g., area deprivation, SVI) and by measures of patient agency (PROMs, shared decision-making documentation), explicitly rewarding disparity reduction and informed choice. Conceptually, this extends outcomes-based payment (Misustin, 2023) from efficiency-only to efficiency-with-justice, and complements India’s PM-JAY differential pricing (Prinja et al., 2023), which weights for cost heterogeneity rather than equity goals. The study would run a multi-site pilot with randomization by clinic: compare standard APMs vs. justice-weighted APMs on disparities in control of chronic conditions (e.g., diabetes), utilization patterns, and clinician behavior. It would also test whether targeted equity incentives minimize common ethical concerns (undertreatment) by tying payments to patient-reported experience and shared decision-making. Impact: a pragmatic path to align bioethics with payment, potentially shifting incentives toward populations and behaviors current models underserve.

References:

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2. An Economic Analysis of Outcomes-based Payment in Healthcare. Brady Misustin (2023). Policy Perspectives.
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