On September 7, 2012, the health policy peer-review journal, Health Affairs, sponsored a day-long briefing at the National Press Club to showcase its September issue, “Payment Reform to Achieve Better Health Care.”  Throughout the day, prominent academics, government officials, representatives of health care providers, and commercial insurer executives discussed their research and recommendations regarding alternative payment structures designed to increase quality of care, promote better health outcomes, and reduce costs.  See this announcement for a complete list of the speakers, including authors from the September issue and their articles discussed at the briefing. 

Jonathan Blum, a Deputy Administrator and Director from the Centers for Medicare & Medicaid Services (CMS), kicked off the event by listing three types of payment reforms to transform the American health care system: (1) promoting the value of care over the volume of care (e.g., capitation or shared savings programs); (2) implementing pay-for-performance arrangements; and (3) changing fee schedule structures (e.g., paying more for primary care versus specialty care services).  He outlined six principles and objectives currently guiding CMS’s approach to payment reform:

  1. Equipping health care providers with multiple reform mechanisms to suit their level of experience and readiness to adopt changes.  For example, participants in the Medicare Shared Savings Program (MSSP) can elect to only share savings with the government (one-sided risk model) or to share savings and losses (two-sided risk model) related to the costs of delivering health care services to Medicare beneficiaries. 
  2. Partnering with health care providers to promote their ability to adopt payment reforms.  For instance, MSSP participants are now granted direct access to CMS’ health claims data which previously was available only to researchers subject to strict confidentiality agreements.
  3. Providing education and training opportunities for health care providers seeking to participate in payment reform initiatives.
  4. Implementing robust quality metrics to measure quality of care and ensure that beneficiaries receive higher quality of services from health care providers who adopt payment reforms.  Thus far, Mr. Blum reported that quality of care metrics for Medicare services have stayed constant.
  5. Involving multiple types of payors in payment and quality of care initiatives.  For example, through its Innovation Center, CMS is using the Comprehensive Primary Care Initiative as one vehicle to engage multiple commercial payors in primary care coordination activities.
  6. Working with other federal agencies to identify laws and regulations that can affect care coordination among health care providers.  Specifically, CMS, the Office of Inspector General, and the Department of Justice have developed waivers to the fraud, waste and abuse laws in an Interim Final Rule applicable to MSSP participants.   

Sam Nussbaum, Executive Vice President and Chief Medical Officer of insurer WellPoint, Inc., followed up with his perspective on how focusing on the health care delivery system is key to addressing cost and quality issues and expanding access and coverage.  He noted that 1% of Wellpoint’s membership drives 28% of the company’s health care costs.  Using this statistic, Mr. Nussbaum highlighted the need to better coordinate health care services to treat those with chronic conditions, as well as address other educational and economic factors to help prevent the onset of chronic illness.

Following the opening presentations, four panels of speakers discussed their own experiences with evaluating various payment reform alternatives and innovations to better coordinate care for patients.  Multiple panelists made the following observations in summarizing lessons learned:   

  • No single payment reform approach provides a one-size-fits-all solution;
  • Actual care coordination improvements at the provider level must complement any approach to payment reform;
  • Achieving lasting payment reform, improvements in health care quality, and health care delivery coordination requires collaboration between public and commercial payors and health care providers;  
  • Payment reform efforts should help beneficiaries realize that higher quality of care need not come at a higher cost; and
  • Data-sharing among providers and payors is integral to achieving and measuring results, but requires all parties to address significant legal and logistical implementation issues.  

The panelists also debated the government’s role in achieving payment reform.  For example, the speakers discussed whether government must structure payment reform initiatives to force providers to quickly abandon fee-for-service payments or continue its gradual approach to reforming payment mechanisms.    

Overall, the briefing provided a forum for multiple health care stakeholders to discuss payment reforms currently underway and debate further changes needed to address the cost-versus-quality challenge facing the American health care system.  The progress of these payment reform initiatives and their ultimate ability to promote higher quality, more cost-efficient health care will continue to generate debate for the foreseeable future.