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When Prevention Becomes Financial Liability - a Woeful Tale of the AWV in VBC

  • May 17
  • 3 min read

When I began talking with providers participating in ACOs and other risk-bearing models about maximizing the Medicare Annual Wellness Visit (AWV), I expected enthusiasm. After all, the ask was simple: fully perform the AWV as designed, capture the patient’s true risk profile, improve preventive care, and appropriately bill for the work already being done.

Instead, I heard this: “We don’t want that revenue. It could work against our shared savings benchmark.”


Think about that for a moment.


The Medicare Annual Wellness Visit was specifically designed to identify risk earlier, uncover unmet needs, strengthen preventive care, improve chronic disease management, and reduce downstream cost and suffering. It should be one of the most strategically important tools in value-based care.


Yet many risk-bearing organizations hesitate to fully embrace the AWV because reimbursement tied to the visit can influence expenditure benchmarks and potentially dilute shared savings performance. In doing so, many may be overlooking the larger opportunity: maximizing AWV reimbursement could help fund the very care management infrastructure needed for more proactive, preventive care — ultimately reducing downstream utilization and potentially offsetting, or even surpassing, any perceived benchmark disadvantage.


At the same time, many fee-for-service providers avoid AWVs for the exact opposite reason:


“There’s no money in it. I can see three or four E/M visits in that same amount of time.”


So, on one side, providers avoid the AWV because they fear financial disadvantage within value-based arrangements. On the other, providers avoid it because fee-for-service reimbursement still rewards volume over prevention. That is not value-based care alignment. That is a reimbursement structure sending conflicting signals to the market.


What makes this even more troubling is that providers are simultaneously leaving legitimate preventive revenue unrealized while also missing one of the richest sources of longitudinal patient risk intelligence available in Medicare care delivery.


When conducted as designed — and translated into proactive interventions — the AWV can identify rising-risk patients earlier, uncover functional decline, surface cognitive impairment, reveal social barriers to care, improve chronic disease management, and prevent avoidable deterioration before patients become more complex and expensive.


In other words, one of the very activities most capable of improving outcomes and reducing total cost of care is often financially deprioritized by the structures meant to support value-based care.


Nationally, AWV completion rates hover around 24% across provider types. That number alone should raise alarms. Not because providers do not care, but because the reimbursement system still does not consistently reward the operational work required to deliver true preventive, longitudinal care.


And it raises an uncomfortable policy question:


If CMS truly wants better outcomes within the current reimbursement structure, why wouldn’t AWV payments be carved out from shared savings benchmark calculations altogether? Why discourage or financially complicate one of the few preventive activities specifically designed to uncover risk before patients become sicker, more fragile, and more costly?


This conundrum exposes a deeper challenge in American healthcare transformation: we still have not changed the true “currency” of care delivery.


Many organizations have become highly focused on quality measure completion because benchmark performance directly affects reimbursement. But benchmark optimization is not always the same thing as meaningful longitudinal improvement in patient health. If a diabetic eye exam is completed but the patient still cannot afford medications, transportation, nutrition, or longitudinal support, did we improve the outcome — or simply improve the score?


Until CMS fully shifts healthcare reimbursement toward measurable improvement in patient outcomes — rather than transactional reimbursement mechanics, benchmark management, and activity-based performance — progress toward true value-based care will remain limited.


The Annual Wellness Visit is one of the clearest examples of this contradiction.

A preventive service specifically designed to improve outcomes, identify risk earlier, and reduce downstream cost remains underutilized across both fee-for-service and value-based environments — for entirely different financial reasons. And if the incentives discourage the very activities most capable of improving outcomes, then the structure itself may be standing in the way of the transformation healthcare says it wants to achieve.


 
 
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