A Look at the Progression of Value-Based Payment Models

By | March 30, 2022

For those in the value-based world, we have been on this journey for years. And we have witnessed and participated in CMS and CMMI creating and implementing various models.  Undoubtedly, some have been more successful than others, and there has been an ongoing debate concerning the impact on value-based payment models.

Two of the major concerns that have been of great consternation are, will CMS stay the course, and, how they will coordinate all the different population and episode-based payment models. Furthermore, we have struggled with the overlap of various models and have been frustrated by the lack of coordination. These frustrations have often felt like “throwing spaghetti on the wall to see what sticks,” is the prevailing ideal.

Recently, CMS announced a strategy to achieve near-universal participation in value-based payment models by 2030. This is an incredibly bold statement and gives clear direction concerning their purpose. This ideal also signals that the days of voluntary participation are likely over. The core of this principle is that every beneficiary should be in a clinical care relationship accountable for the quality and total cost of care, i.e., affordability. Additionally, there is a great deal of focus on health equity regarding implementing these models.

Though these ideals sound laudable, there are numerous barriers. And many are concerned that members will lose a level of choice if the only available options are models, they might view as limiting services and clinician networks. Moreover, there are presently 20 ongoing value-based payment programs and models that overlap. This complexity leads to confusion and difficulty in implementing programs. Up until this point, the majority have been voluntary, so individual organizations have been able to decide which program fits best for them or choose to sit on the side lines.

There is also a debate on whether the best value-based payment models are population-based, episode-based, or population health care management versus the bundled-payment model. Of course, they are not necessarily in direct opposition, and they may both work together. A bundled-payment program can work within a population-based payment model. We can even think of a “bundle of bundles” that leads to a population-level approach. It behooves us to recognize that one size will not accommodate all situations. Additionally, it’s essential to evaluate a fee-for-value model that pays on a per-unit basis but on a unit of value for a unit of service.

Regardless of the approach, coordination will be critical. How do we manage bundled payments for specialty and facility-based care in a population chosen to be part of an accountable care organization? How do we manage the payment to specialists in a primary care-driven population health program? There are many creative ways to accomplish our goals. However, we must create a hierarchical approach, and work in harmony to reduce the number of programs currently in play. Innovation needs to continue but within a set of guideposts created based on our learnings over the past few decades.