The health care industry has increasingly embraced value-based care models, but the road has been far bumpier in the realm of substance use disorder (SUD) treatment. Despite strong interest from both providers and payers, the implementation of value-based care in SUD treatment is being slowed by mismatched systems, cautious contracting, and lack of consensus around defining successful outcomes.
These challenges are especially frustrating considering that addiction—chronic and often cyclical by nature—seems particularly suited for value-based approaches that reward long-term positive outcomes over short-term, volume-based services. But structural limitations are making it difficult to operationalize these arrangements.
Steve Priest, CEO and president of Spero Health, described the disconnect at Behavioral Health Business’ VALUE event. Even when providers and payers agree on a value-based framework, actually executing those agreements is often impossible. “If you’re a provider, you’ve basically reached an agreement. Everybody from the contracting side says we should do this, and then you can’t get it over the finish line,” Priest said. This statement captures a core truth: value-based care in SUD treatment is conceptually embraced but procedurally stuck.
Systems Aren’t Built for It—Yet
One of the biggest obstacles to implementing value-based care in SUD treatment is infrastructure. Most payer systems are still configured for fee-for-service models. These rigid frameworks make it nearly impossible to support flexible reimbursement contracts focused on outcomes like sobriety duration, quality of life, or reduced hospital admissions.
Priest points out that system design hasn’t caught up with innovation. Even when both sides want a value-based arrangement, the backend systems aren’t ready. “The lack of system design for moving forward with some of these things gets to the point that it can’t be operationalized,” he explained.
But providers aren’t without blame. Priest admits that many still don’t meet the sophisticated data-sharing expectations value-based models demand. Some lack a robust electronic health record (EHR) system entirely, while others struggle to produce the granular analytics that payers require to track success metrics.
Contracting Caution Slows Urgent Need
Despite skyrocketing overdose rates, which the CDC reports reached over 107,000 deaths in a 12-month period, insurers remain deliberate—sometimes overly so—in their transition to value-based payment models. Eric Bailly, business solutions director for SUD strategy at Anthem Inc., echoed this at the VALUE event. “We can’t be urgent enough with our responses,” he said, “but we also need to be thoughtful with how we build the foundation for the future.”
It’s a delicate balancing act: moving too fast risks implementing poorly thought-out programs, but moving too slowly allows a crisis to deepen. Bailly remains optimistic about the future of value-based care in SUD treatment, stating that the field is still in its early stages. Importantly, he sees a growing focus on outcomes and performance—two metrics long missing from the traditional SUD care landscape.
Redefining What Success Means in Addiction Recovery
One major reason value-based care in SUD treatment is difficult to scale is because there’s no standardized definition of “success.” That’s something Cooper Zelnick, Chief Revenue Officer at Groups Recover Together, is working to change. His company has embedded custom outcome definitions directly into payer contracts, moving away from vague targets toward actionable metrics.
Their primary success measure? A six-month retention rate. “We’re held accountable, not for delivering services, but for retaining our members and producing lower cost of care,” Zelnick said. This isn’t just a convenient benchmark—it’s based on data showing patients who remain in care for more than six months are less likely to relapse or die from overdose.
Compared to the industry’s dismal six-month retention average of 25% to 30%, Groups Recover Together boasts retention rates of 68% for Medicaid patients and 75% for commercial insurance patients. These numbers offer compelling evidence that value-based care in SUD treatment can deliver better results when focused on meaningful metrics.
Multiple Definitions, Shared Goals
While Groups Recover Together focuses on six-month outcomes, Spero Health uses 90-day and one-year benchmarks. On average, patients stay in Spero’s programs for about 10 months, but getting them past the first few weeks is the priority. “We have a real laser focus on getting patients off to the right start,” said Priest. “We want to see our first 30 days, our first 15 days really improve.”
Despite the variation in what and how retention is measured, Bailly says that different approaches don’t derail partnerships. For payers like Anthem, what matters most is that these varied methods all contribute to improved health and reduced costs—core components of value-based care in SUD treatment.
This flexibility may be a temporary but necessary part of the evolution. It allows providers and payers to experiment, learn, and build better frameworks. Zelnick and Priest both expressed a desire for more federal guidance, but neither wants to see innovation stifled by rigid standards too early in the process.
Toward a Sustainable Future
As value-based care in SUD treatment continues to mature, the industry must confront several realities: legacy systems need to evolve, providers must invest in data infrastructure, and payers must shift away from conservative contracting mindsets. But most importantly, all stakeholders need to align on what outcomes really matter.
Federal definitions and standardized metrics could accelerate adoption, but they must be paired with field-driven innovation. Priest summed it up well: “In this period of exploration and of pioneering the world, it’s also good for people to try different things… None of these approaches are wrong.”
The movement toward value-based care in SUD treatment is not linear, but it is gaining momentum. Providers like Spero Health and Groups Recover Together show what’s possible when the system—however imperfect—starts to focus on patient progress instead of service volume. If payers and providers can continue working together, adapting and refining as they go, this model could become a cornerstone in reshaping how we treat addiction in America.
