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CMS Announces Goals to Increase Value-Based Purchasing

The Department of Health and Human Services (HHS) seeks to move 90 percent of Medicare fee-for-service payments to value-based purchasing models by 2018, according to goals released last week.

Alternative payment models include Accountable Care Organizations, advanced primary care medical home models, new models of bundling payments for episodes of care and integrated care demonstrations for beneficiaries enrolled in Medicare/Medicaid.


HHS has placed CMS payments into four categories:

  • Category 1: fee-for-service with no link of payment to quality
  • Category 2: fee-for-service with a link of payment to quality
  • Category 3: alternative payment models built on fee-for-service architecture
  • Category 4: population-based payment
     

Value-based purchasing applies to payments made in categories 2-4. In 2014, an estimated 20 percent of Medicare reimbursements shifted to these payment models, linking physician reimbursement to patient outcomes.

HHS has set the goal of 30 percent of Medicare payments in categories 3 and 4 by the end of 2016 and 50 percent by the end of 2018. HHS seeks to have 85 percent of Medicare fee-for-service payments in value-based purchasing categories 2 through 4 by 2016 and 90 percent by 2018.

For more information on CMS’s latest announcement, click here.

Learn more about bundled payments in the ORTHOKNOW® article, Pricing Strategy Shifts from Operating Room to Episode of Care.

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