Medicare sets goals for value-based reimbursement

Federal officials have set an ambitious timeline to speed up adoption of Medicare reimbursement models based on value, instead of strictly volume of services.

The U.S. Department of Health and Human Services (HHS) announced Monday a goal of having at least 85 percent of all traditional, fee-for-service Medicare payments tied to some sort of quality component by the end of 2016 and 90 percent by the end of 2018. As part of that effort, it aims to have at least 30 percent of all Medicare payments tied to quality or value through alternative payment models, such as accountable care organizations or bundled payment arrangements, by the end of 2016 and 50 percent by the end of 2018.

This is the first time HHS has set distinct targets for value-based payment models, which were included in the Affordable Care Act but not tied to specific goals. Proponents say changing from the current fee-for-service model will cut costs and encourage physicians to take greater responsibility for patient outcomes. HHS officials say about 20 percent of Medicare payments are now tied to alternative payment models, compared with none in 2011. Medicare fee-for-service payments last year totaled $362 billion.

HHS Secretary Sylvia Burwell announced the new goals after meeting with a group representing physicians, insurers, large corporations, and consumers. She also announced the creation of the Health Care Payment Learning and Action Network, which will work with all of these groups, plus individual states and Medicaid programs, to develop and encourage new alternative payment models.

For more information, Medicare has provided a fact sheet.