Today HHS Secretary Sylvia M. Burwell announced ambitious plans to move from “volume to value in Medicare payments” by accelerating the share of Medicare fee-for-service (FFS) payments that are tied to quality and value and reimbursed through alternative payment models. The first goal in the initiative is for 30% of Medicare provider payments to be in alternative payment models – such as accountable care organizations, medical homes, bundled payments -- by 2016 (up from about 20% today). The goal would rise to 50% by 2018.

Under the second component of the plan, HHS seeks to tie 85% of Medicare FFS payments to quality by 2016, rising to 90% in 2018. In addition to the various alternative payment models, such quality programs include the Hospital Value Based Purchasing Program, the Hospital Readmissions Reduction Programs, and the Physician Value-Based Modifier.

To extend these value initiatives beyond Medicare and reach a “critical mass of payers,” HHS is announcing the establishment of the Health Care Payment Learning and Action Network to coordinate the efforts of the private, public and non-profit sectors, including private payers, large employers, providers, consumers, and state and federal partners. The goal of the Learning and Action Network is to facilitate joint implementation and expansion of new models of payment and care delivery; collaborate to generate evidence and share approaches; develop common approaches to core issues such as beneficiary attribution, financial models, benchmarking, and risk adjustment; and create implementation guides for payers and purchasers. The Network will hold its first meeting in March 2015.

For additional details, see Secretary Burwell’s “Perspectives” article in the New England Journal of Medicine.