Health care payments should encourage improved care delivery and ensure appropriate compensation for patient-centered care — including care coordination, integration, and prevention and wellness.
Reconfiguring payments for health care services to incentivize value will allow providers to invest in practice improvements that optimize provision of care to focus more on patient needs as well as the needs of the provider.
A shift from traditional fee-for-service (FFS) payments to person-focused payments (where a single payment encompasses all or much of a person’s overall care) offers a promising way to create and sustain delivery systems that value:
- Cost effectiveness
- Patient engagement
These payments can include accountability for quality of care at the population level, rather than for the volume of specific services. Population-based payments give providers more flexibility to coordinate and manage care for individuals and populations.
Substantially reduced incentives to increase volume — combined with increased incentives to provide currently undervalued FFS — creates flexibility that will expedite innovations in care delivery, particularly for individuals with chronic, complex, or costly illnesses.
All alternative payment models (APMs) and payment reforms designed to deliver better care at lower costs share a common pathway to success. All providers, payers, and other players in the health care system must make fundamental changes in their day-to-day operations to improve quality and reduce health care costs.
However, a critical mass of payers must broadly adopt the new APMs and payment reforms before these operational changes can become viable and attractive.
Medicare beneficiaries in alternative payment models have more control over their health care, while providers have better information about their patients’ medical history — and stronger relationships with their patients’ other providers.
Doctors and other clinicians can focus on coordinating care to ensure their patients, especially those with chronic conditions, get the right care at the right time — while avoiding medical errors and duplication.
Alternative payment models give providers an incentive to coordinate care inside and outside the doctor’s office. Through coordinated care providers can, for example:
- Help patients with their medications
- Communicate upcoming appointments and expectations
- Talk with other members of the patient’s care team