Common Payment Reform Models

Shannon Vandegriff

Payment Reform

Background

Fee-for-service, the predominant method of paying for health care in the United States, is an unsustainable payment approach that rewards volume, resulting in an increase in the number of health care services that are provided, regardless of the outcome of the service. Many believe this form of payment has contributed greatly to the ever-increasing costs of health care. Payment reform, which entails moving away from the fee-for-service system, is regarded as a promising strategy to lower the cost and improve the quality of the U.S. health care system. Payment reform is not an end itself, but rather a means to spark fundamental changes in health care delivery. (Bailit Health Purchasing, LLC, 2013)

Common Payment Reform Models

·  Global Payment

·  Bundled Payment

·  ACO Shared Savings

·  Medical Home (per member per month)

·  Pay for Performance (P4P)

Discussion Questions

·  Should one payment reform model be adopted nationally? Or, is a mixed payment system more appropriate?

o  Should different models be applied in different settings/locations, according to the preferences of the community?

·  Who should be the facilitators of payment reform (payers, providers, government, etc.)?

·  To what extent should payment be dependent upon performance (quality, metrics)?

·  What aspect of the policy process will be the biggest hurdle for achieving payment reform (e.g., framing, implementation, politics, power, information, etc.)?

o  How can this be addressed?

Readings

Bailit Health Purchasing, LLC. (2013). Facilitators and Barriers to Payment Reform: Market-based, Governmental, Organizational, and Design Considerations. Princeton, NJ: Robert Wood Johnson Foundation. Retrieved from http://www.rwjf.org/en/research-publications/find-rwjf-research/2013/09/facilitators-and-barriers-to-payment-reform.html

Delblanco, S. (2013, September 12). Payment Reform: Progress And Lessons Learned. Health Affairs Blog. Retrieved from http://healthaffairs.org/blog/2013/09/12/payment-reform-progress-and-lessons-learned/

Robert Wood Johnson Foundation. (2012). Payment Reform: Bundled Episodes vs. Global Payments. A debate between Francois de Brantes and Robert Berenson. Princeton, NJ: RWJF. Retrieved from http://www.rwjf.org/en/research-publications/find-rwjf-research/2012/09/payment-reform--bundled-episodes-vs--global-payments.html

·  Read the following sections: Introduction, The Payment Models, and Question 1 under The Debate (Pg. 1 through top of pg. 4)

RWJF – Payment Matters: The ROI for Payment Reform – Read one of the following

·  The ROI for Patient-Centered Medical Home Payment

·  The ROI for Bundled Payment

·  The ROI for Population-based Payment

·  The ROI for High-Intensity Primary Care Payment

http://www.rwjf.org/en/research-publications/find-rwjf-research/2013/02/payment-matters--the-roi-for-payment-reform.html