The Missing Piece: Why Value-Based Care Hasn’t Fully Taken Hold in Pediatric Mental Health

Value-based care is the future of healthcare—at least, that’s what we keep hearing. It’s a model designed to incentivize quality over quantity, outcomes over procedures, and preventative care over reactive treatment. But when it comes to pediatric mental health, value-based care remains more of a talking point than a reality. Why? Because the healthcare system wasn’t built to measure the true impact of early, comprehensive mental health care for kids. And because, for the most part, we’ve left children out of the conversation.

It’s time to change that.

What is Value-Based Care, Really?

Value-based care has a range of definitions depending on who you ask. At its core, it aims to move away from the traditional fee-for-service model—where providers are paid based on the volume of visits and procedures—and instead rewards healthcare systems and clinicians for delivering high-quality, cost-effective care.

There are two primary ways this happens:

1. Capitated Models: Providers receive a set amount per patient per year, incentivizing them to manage care efficiently and prevent costly interventions down the line.
2. Quality-Based Incentives: Providers are rewarded based on specific performance metrics—things like reducing emergency room visits, improving adherence to treatment plans, or ensuring faster access to care.

The problem? Pediatric mental health doesn’t fit neatly into either approach.

Why Hasn’t Value-Based Care Taken Hold in Pediatrics?

There are a few key reasons why pediatric mental health has struggled to align with value-based care models:

• No Standard Metrics: Unlike in adult care, where outcomes like reduced hospital readmissions or controlled A1C levels in diabetes are clear indicators of success, pediatric mental health lacks universally agreed-upon measures of value.
• The Ecosystem Effect: The value impact that you have in a child cannot be measured just at the child. It has to be at the caregiver level, at the Family Constellation level. No one has any kind of data infrastructure to actually measure that today. A child’s mental health is deeply intertwined with their home environment, schooling, and social determinants of health—factors that are often outside the direct control of healthcare providers.
• Medicaid’s Role (or Lack Thereof): The bulk of pediatric mental health care in the U.S. is funded by Medicaid, yet Medicaid has been slow to implement value-based contracts. Unlike Medicare, which has been the focus of value-based initiatives in adult care, pediatric care has not been viewed as a high-cost priority. But with rates of anxiety, depression, and behavioral health conditions skyrocketing in kids and teens, that thinking needs to change.
• The Social Determinants Challenge: A pediatric patient—a kid—is so dependent on the health of the adults around them. They’re dependent on their school, their housing, their food security, and they have no control over any of it. Addressing mental health in children means addressing the bigger ecosystem they live in, something most value-based models weren’t designed to do.

A Few Bright Spots

Despite these challenges, there are examples of value-based care models working in pediatric mental health. Organizations such as Nemours Children’s in Florida have taken on risk-based Medicaid contracts, offering comprehensive wraparound services—including transportation assistance, food pantries, and behavioral health support—to ensure children get the care they need.

What makes these models successful? They take a holistic view of health, understanding that a child’s well-being is tied to more than just their time in a doctor’s office. It takes something global to take a value-based approach. You can’t just work on the child. It needs to be an ecosystem approach.

Where Do We Go from Here?

If we want to see real movement toward value-based care in pediatric mental health, three key shifts need to happen:

1. Defining Meaningful Metrics: Pediatricians, behavioral health specialists, and healthcare leaders need to work together to develop standardized measures of success. These should account for both individual treatment outcomes and broader family and social impacts.
2. Expanding Medicaid’s Role: Policymakers and payers must prioritize pediatric mental health by expanding value-based contracting and incentives for early intervention. Not all states accept CoCM codes. In fact, less than half of U.S. states allow Medicaid to pay for CoCM services. Even in states that do cover it, the payment rates are often lower than what Medicare offers, making it harder to use this model widely, despite proven benefits. 
3. Building Data Infrastructure for the Ecosystem Approach: Healthcare systems must invest in ways to track and analyze family- and community-level health impacts—not just individual patient outcomes.

What Can Pediatricians Do Now?

For pediatricians and healthcare professionals on the ground, the path forward starts with awareness. Here are three practical steps:

1. Understand What Value-Based Care Means in Your Practice: Learn about existing value-based initiatives in your region and how they might apply to pediatric mental health.
2. Advocate for Pediatric-Specific Metrics: Engage in conversations with payers, hospital systems, and policymakers about the need for better ways to measure pediatric mental health outcomes.
3. Think Beyond the Clinic Walls: Partner with schools, social services, and community organizations to address the social determinants affecting your patients’ mental health.

The Bottom Line

Pediatric mental health is at a tipping point. We can no longer afford to leave children out of the value-based care conversation. The stakes are too high, and the gaps in care are too wide. It’s time to redefine value—not just as a measure of dollars saved, but as an investment in healthier futures for kids and families.

Value-based care in pediatric mental health isn’t impossible. It just requires a shift in thinking, a commitment to innovation, and a willingness to build a system that truly values children’s well-being. Systems with value-based contracts and capitation models like CoCM are already proving out, and we need to champion them because the question isn’t whether we can do it—it’s whether we will.

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