Health Affairs This Week Is Value-Based Payment Failing U.S. Healthcare? | Andrew Ryan
Feb 27, 2026
Andrew Ryan, director of Brown’s Center for Advancing Health Policy Through Research and health policy scholar, critiques value-based payment and managed care. He reviews evidence showing little Medicare savings. He explains why incentives, churn, and benchmarks undermine reforms. He links technology, pricing, and CMS authority to long-term spending and calls for major structural fixes.
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Value-Based Payment Hasn't Bent Medicare's Cost Curve
- Value-based payment (VBP) and risk-based contracting have had little to no impact on aggregate Medicare spending.
- Andrew Ryan cites literature and timing: spending slowed before VBP adoption and recent spending rises occurred while VBP expanded, contradicting a broad spillover effect.
Technology Adoption Drives Spending Growth
- Long-term U.S. health spending growth is primarily driven by adoption and pricing of new medical technology, not physician payment incentives.
- Ryan argues VBP lacks mechanisms to prudently manage high-cost technology adoption and pricing in Medicare.
Evaluations Overstate Shared Savings
- CMS and CBO evaluations show many Medicare VBP programs saved little and may have increased spending after incentive payments.
- Ryan points to the CBO finding of roughly $5 billion increased spending and argues CMS benchmark-based estimates misstate true counterfactual savings.