Introduction
The United States of America is no longer a volume-based care system; rather, it has shifted towards a value-based care system and has developed a population health ecosystem. But have you ever wondered what the U.S. government is doing that is causing the healthcare ecosystem there to undergo a proactive shift?
What encourages U.S healthcare organizations to adopt population health analytics and management? Why is India struggling to build a population health ecosystem?
Let’s take a deep dive and find out all the answers.
U.S. Government Incentives & Payment Models to build a Population Health Ecosystem
Earlier, the U.S government gave rewards depending on the volume, but now the rules have changed. The U.S government runs programs where rewards are based on outcomes, cost efficiency, and preventive care. Hospitals are rewarded for reducing patients’ readmissions. This will encourage hospitals to improve their treatment plans and follow-up systems. The program is led by the Centers for Medicare & Medicaid Services (CMS).
Some popular government programs like the Medicare Shared Savings Program (MSSP), Accountable Care Organization Realizing Equity, Access, and Community Health (ACO REACH) model, Merit-based Incentive Payment System (MIPS), and Hospital Readmissions Reduction Program (HRRP) are encouraging hospitals to adopt data and technology, detect high-risk patients early, and take preventive measures.
Here is a list of additional programs run by the U.S. government, their benefits, penalties, financial benefits, and strategic advantages.
| Program | Direct Benefit to Hospital | Financial Benefit | Penalty Risk | Strategic Advantage |
| MSSP (ACO Model) | Rewards for preventive care and risk patient management | Shared savings bonus (can reach millions of dollars) | Shared savings will not be available for poor performance | Value-based care is positioning itself strongly |
| ACO REACH | Incentives for managing high-risk & underserved populations | Risk-adjusted higher payments and shared savings potentials | Loss-sharing risk if cost control is not achieved. | Leadership in health equity and population health |
| HRRP | Encourages a reduction in 30-day readmission | Protects Medicare reimbursement revenue | Up to 3% Medicare payment reduction | Improved discharge planning & follow-up system |
| Hospital-Acquired Condition Reduction Program(HACRP) | Encourages reduction in hospital-acquired infections and complications | Full Medicare payment retained | Up to 1% Medicare payment reduction | Patient safety reputation improves |
| Merit-based Incentive Payment System(MIPS) | Incentivizes quality reporting and clinical performance improvement | Positive payment adjustment (bonus) | Negative payment adjustment | Greater performance transparency |
| Bundled Payments for Care Improvement (BPCI) | Promotes cost control for specific treatment episodes | Share of savings if spending is below the target | Financial loss if spending exceeds the target | Stronger care coordination across providers |
| Center for Medicare & Medicaid Innovation (CMMI) Models | Supports the adoption of innovative care models | Performance-based financial incentives | Financial risk depends on model design | Innovation-driven market positioning |
Impact of PHM & PHA in the Real World Example
CommonSpirit Health is an American-based healthcare organization. It is a Catholic non-profit hospital chain that operates more than 700 care sites and 142 hospitals in 21 states. It establishes its own Population Health Services Organization (PHSO) to strengthen and improve outcomes with data analytics and care coordination. By implementing PHSO, this healthcare organization achieves some outcomes, such as
| Area | Outcomes | PHM/ Analytics Interventions |
| ACO Performance & Quality | 63% of CommonSpirit’s MSSP ACOs achieved shared savings. 10 out of 16 ACOs generated savings. Delivered $37+ million cumulative savings (PY 2019). Improved quality scores across preventive and chronic care metrics. | Risk stratification Chronic disease monitoring Preventive screenings Care gap closure |
| Chronic Disease Improvements | From Population Health Annual Report: 130,000+ patients improved blood pressure control. 35,000+ patients improved their diabetes control. Evidence-based, analytics-driven outreach programs. | Strong PHM registry management Targeted care coordination Data-based clinical alerts |
| Reduced Hospitalizations & Emergency Visits | Using PHM: Up to 4% reduction in inpatient hospitalizations. 8% reduction in emergency department visits. | Predictive risk modeling Preventive care intervention Early disease management |
| Behavioral Health Outcomes (Collaborative Care Model – with Concert Health) | ~55% of patients achieved at least 50% symptom improvement within 90 days. Integrated behavioral health into primary care. | Track symptom progression Identify non-responders early Adjust care pathways |
| Infection Prevention & Patient Safety | Avoided approximately 3,200 hospital-acquired infections since 2020. System-wide safety improvement initiatives. Recognized for quality gains nationally. | Real-time surveillance analytics Standardized safety dashboards Clinical data integration |
Indian Government Health Initiatives
The Indian government is also running several programs to help patients receive better treatment. India is a populous country with limited public health infrastructure. Approximately 1.2 billion people in the total Indian population are in the lower-income group, ~66 million are in the middle-income group, ~16 million are in the upper-middle-income group, and ~2 million are in the high-income group, as per the 2021 report by the Pew Research Center
Since a large proportion of India’s population is rural and belongs to the lower-income group, the government primarily focuses on healthcare initiatives for these segments, resulting in limited motivation to introduce additional schemes for higher-income groups.
Here is a list of some programs run by the Indian government for the lower-income group, their benefits, penalties, financial benefits, and strategic advantages.
| Scheme / Initiative | Key Benefit | Target Beneficiaries |
| Ayushman Bharat- PM-JAY | ₹5 lakh annual health cover per family for secondary & tertiary care | 55 crore people (~40% population) |
| Ayushman Vay Vandana | PM-JAY coverage extended to all senior citizens aged 70+ | All elderly (70+), regardless of income |
| AB-Health & Wellness Centres (AB-HWCs) | Free universal essential health services | General public |
| Rashtriya Arogya Nidhi (RAN) | Financial assistance for treatment | Below Poverty Line (BPL) patients |
| Health Minister’s Cancer Patient Fund (HMCPF) | Financial support for cancer treatment | Economically weaker patients |
| Affordable Medicines and Reliable Implants for Treatment (AMRIT) Pharmacy Scheme | Discounted medicines & implants for cancer & heart diseases | General public (especially critical patients) |
Gaps in Incentives for Analytics in India
The Indian government is making significant progress in digital health infrastructure, but still lacks analytics-driven performance incentives, unlike the U.S healthcare system. Until India links financial rewards to measurable population health outcomes, demand for standalone Population Health Analytics companies will remain limited. When analytics-driven efficiency is not incentivized, healthcare inefficiencies persist, and the resulting financial strain is borne directly by patients through higher out-of-pocket spending.
Here is a list of some areas the government needs to focus on:
- Lack of public healthcare infrastructure and facilities in rural areas.
- The majority of private hospitals focus on volume rather than value-based care.
- Lack of strict government regulatory bodies.
- Take strict action against the hospitals for violating the rules.
- Lack of continuous monitoring in healthcare organizations.
Conclusion
The Indian government should impose strict regulations and provide incentives, as the U.S. government has, so that healthcare organisations will focus on value rather than volume. Also, the Indian government should work on the areas that need more care using population health analytics and population health management data platforms, and run essential programs to provide better care. And shift healthcare from reactive to proactive care.
With the support of the Indian government, the population healthcare ecosystem will definitely become strong, and healthcare organizations must adopt population health analytics and management platforms. A rise in the adoption of PHM and PHA software solutions in India will likely accelerate the growth of new PHM and PHA technology companies, strengthening the country’s digital healthcare ecosystem.
References
https://www.commonspirit.org/news-articles/quality-week-press-release