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6 Most Common Value-Based Payment Models

by Fred Pennic 05/29/2014 Leave a Comment

Value-Based Payment Models While 75% of providers currently participate in at least one value-based payment model, and more than 60% expect them to become the dominant payment model, fewer than 30% believe they offer a good level of reward for the risk. This is according to a study published by Availity, one of the nation’s leading health information networks.

What is a Value-Based Payment Model?

Payment arrangements that pay physicians, hospitals, medical groups, and other health care providers based on measures including quality, efficiency, cost, and positive patient experience

The Provider Attitudes Toward Value-Based Payment Models study highlights feedback from more than 500 physician practice and hospital-based professionals nationwide. It summarizes the providers’ real-world experience with these new models, revealing perspectives on the impact they will have to the health care system, and calling out the gaps and barriers hindering success. The study follows the 2013 research Availity conducted to determine the operational readiness of providers and health plans to implement value-based models of care and reimbursement.

The key findings outline the six most common value-based payment models: 

1. Medicare Quality Incentive Programs

Medicare Quality Incentive Program is a pay-for-reporting program that gives eligible professionals incentives and payment adjustments if they report quality measures satisfactorily. Although PQRS is a standalone program, it touches on other CMS programs that require quality reporting, such as the eRx Incentive Program, the EHR Incentive Program, the Medicare Shared Savings Program, and the Value-based Payment Modifier.

2. Pay for Performance

In a pay-for-performance system, providers are compensated by payers for meeting certain pre-established measures for quality and efficiency. Pay-for performance-programs have been implemented by both Medicare and private insurers.

3. Accountable Care Organization

Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients.

The goal of coordinated care is to ensure that patients, especially the chronically ill, get the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors.

When an ACO succeeds both in both delivering high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the Medicare program.

4. Bundled Payments

Episode or bundled payments are single payments for a group of services related to a treatment or condition that may involve multiple providers in multiple settings. This model has been tested in a number of settings. Geisinger Health System in Pennsylvania, for example, developed its ProvenCare model as a bundled payment model for coronary artery bypass graft (CABG) surgery; other organizations have been experimenting with the Prometheus model in which evidence-based case rates are used to determine the total resources required to deliver clinically appropriate care for acute and chronic illnesses. The largest evaluation of a bundled payment model was Medicare’s CAGB surgery demonstration, which ran from 1991 to 1996. Four U.S. hospitals participated in the program, and each was paid a single fee for inpatient and physician services during hospitalization, readmissions within 72 hours, and related physician services during the 90-day global period, but not other pre- and post-discharge physician services.3

5. Patient Centered Medical Home

The PCMH is a team-based model based on the premise that the best healthcare begins with a strong primary care foundation, accompanied by quality and resource efficiency incentives. Patients in a PCMH have a personal provider, who along with his/her team, provides continuous, accessible, family-centered, comprehensive, compassionate and culturally-sensitive health care in order to achieve the best outcomes. The PCMH section collaborates closely with the Services in implementation efforts, policy development and the formal recognition process.

The PCMH is a model of healthcare based on an ongoing, personal relationship between a patient, doctor and the patient’s care team.  Whatever the medical needs – primary or secondary, preventive care, acute care, chronic care, or end-of-life care – the patient has a medical “home”; a single, trusted doctor and care team, through which continuous, comprehensive and integrated care is provided.

6. Payment for Coordination

This model involves payment for specified care coordination services, usually to certain types of providers. The most typical example of this is the medical or health care home model whereby the medical home receives a monthly payment in exchange for the delivery of care coordination services that are not otherwise provided and reimbursed.

 References: 

 http://www.hrsa.gov/healthit/toolbox/HealthITAdoptiontoolbox/QualityImprovement/whatispay4perf.html

http://pcmh.ahrq.gov/page/defining-pcmh

http://www.tricare.mil/tma/ocmo/PatientCenteredMedicalHome.aspx

http://www.bcbs.com/why-bcbs/patient-centered-medical-home/

http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ACO/

http://www.medicare.gov/physiciancompare/staticpages/data/pqrs.html?AspxAutoDetectCookieSupport=1

 

Tagged With: Value-Based Payment Models

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