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Michael Petruzzelli

, National Council for Behavioral Health

HHS Outlines Goals for Tying Medicare and Medicaid Reimbursement to Value-Driven Care

January 29, 2015 | Medicaid | Medicare | Quality | Uncategorized | Comments
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Providers of the future will be paid based on quality and value. That was the message of Department of Health and Human Services (HHS) Secretary Sylvia Burwell this week, as she announced new measurable goals and a timeline intended to move the Medicare program further toward value-driven care. The Secretary also announced the creation of a Health Care Payment Learning and Action Network, which will involve working with state Medicaid programs, consumers, private payers, employers, providers, and others to expand alternative payment models into their programs. This is the first time in the history of the Medicare program that HHS has set explicit goals for alternative payment models [APMs] and value-based payments.

In a New England Journal of Medicine (NEJM) perspective piece, Burwell announced that HHS will aim to have 85% of all Medicare fee-for-service payments tied to quality or value by 2016, and 90% by 2018 – with a further goal of having 30% of Medicare payments tied to quality or value through APMs, such as Accountable Care Organizations or bundled payments by the end of 2016, and 50% by the end of 2018. HHS notes the role of the ongoing Hospital Value-based Purchasing and Hospital Readmissions Reduction programs as leverage in meeting these ambitious targets.

HHS outlined three strategies to achieve these value-based payment goals:

(1)   Create an environment in which hospitals, physicians, and other providers are rewarded for delivering high-quality health care and have the resources and flexibility they need to do so. In that regard, HHS notes that it intends to “develop and test new payment models for specialty care, starting with oncology care, and institute payments to providers for care coordination for patients with chronic conditions;”

(2)   Improve the way care is delivered to support ongoing reforms, such as the Partnership for Patients initiative, Transforming Clinical Practice Initiative, Medicaid health homes and patient-centered medical homes, among other efforts; and

(3)   Accelerate the availability of information to guide decision making, noting “ongoing efforts to advance interoperability through the alignment of health IT standards and practices with payment policy so that patients’ records are available when needed at the point of care to permit informed clinical decisions to be made in a timely fashion,” as well as further transparency-related work.

Meanwhile, several of the nation’s largest health systems and insurers have launched a new joint effort to shift 75% of their business to contracts with incentives for quality and lower-cost healthcare. The group, dubbed the Health Care Transformation Task Force, plans to develop policy proposals and private-sector initiatives for accountable care organizations, bundled payments and care for high-cost patients, including those at the end of life and those with multiple chronic diseases, according to the task force website.