A Roadmap For Driving High Performance In Alternative Payment Models

Health care spending is projected to grow to 19.4 percent of gross domestic product (GDP) by 2027, and big gaps in quality and access to care persist. This has motivated payers and providers to implement alternative payment models (APMs) to enable higher-value care. There is bipartisan agreement, reflected in the Medicare Access and CHIP Reauthorization Act (MACRA) and actions by Republican and Democratic administrations, that moving away from fee-for-service (FFS) towards value-based payment is critical.

The Health Care Payment Learning & Action Network (LAN), a multi-stakeholder-driven public-private partnership, was established by the Centers for Medicare and Medicaid Innovation (CMMI) in 2015 to accelerate this transition. With broad collaboration from public and private payers, the LAN has used its hallmark Alternative Payment Model (APM) Framework to categorize U.S. health care payments and identify the percentage of payments made through shared savings/risk models, episode-based payment models, and population-based models.

The LAN found that, in 2015, 23 percent of all health care payments were tied to APMs, or Categories 3 and 4 payment models as defined by the LAN Framework. The most recent APM measurement effort determined that 34 percent of health care payments in 2017 were tied to an APM; 12.5 percent of all payments were linked to downside risk models.