Contract Mechanisms for Value-Based Technology Adoption in Healthcare Systems

Abstract

Although technological innovations are often intended to improve quality and efficiency, they can exacerbate systemic challenges when not aligned with the principles of value-based care. As a result, healthcare systems in many countries face persistent inefficiencies stemming from the overuse, underuse, misuse, and waste associated with the adoption of health technology. This narrative review examines the dual impact of healthcare technology and evaluates how contract mechanisms can serve as strategic tools for promoting cost-effective, outcome-oriented integration. Drawing from healthcare management, and supply chain literature, this paper analyzes various payment and contract models, including performance-based, bundled, cost-sharing, and revenue-sharing agreements, through the lens of stakeholder alignment. It explores how these mechanisms influence provider behavior, patient access, and system sustainability. The study contends that well-designed contract mechanisms can align stakeholder incentives, reduce inefficiencies, and support the delivery of high-value care across diverse healthcare settings. We provide concrete examples to illustrate how various contract mechanisms impact the integration of health technologies in practice.