A report issued by the Health Care Payment Learning & Action Network (LAN) suggests that health care spending is leaning away from legacy fee-for-service (FFS) payments, and toward alternative payment models (APMs).
The report notes that 29% of total US health care spending was tied to APMs in 2016, compared to 23% in 2015.
Results from the report highlight a shift away from FFS payments, which tend to reimburse only on volume, and toward APMs that are more patient-centered. This shift could be the result of the recognition that APMs show promising results in terms of improved quality and cost outcomes, according to a media release from Health Care Payment Learning & Action Network.
In the report, actual 2016 health care spending data from more than 80 participants—accounting for nearly 245.4 million people, or 84% of the covered US population—was collected, from four sources: the LAN, America’s Health Insurance Plans (AHIP), the Blue Cross Blue Shield Association (BCBSA), and the Centers for Medicare and Medicaid Services across commercial, Medicaid, Medicare Advantage, and fee-for-service (FFS) Medicare market segments.
The data was then categorized according to the four categories of the original LAN APM Framework, according to a media release from LAN.
According to the report, 43% of health care dollars were spent in Category 1 (eg, traditional FFS or other legacy payments not linked to quality); 28% of health care dollars were spent in Category 2 (eg, pay-for-performance or care coordination fees); and 29% of health care dollars were spent in a composite of Categories 3 and 4 (eg, shared savings, shared risk, bundled payments, or population-based payments), the release continues.
The report analysis notes a shift away from legacy FFS payments and a marked growth in Category 2, where payments are tied to value. It also notes a six-percentage-point increase in alternative payment model payments (Category 3 and 4), bringing total APM spending to approximately $354.5 billion dollars nationally.
“As health care expenditures and capabilities have continued to rise, it’s vital that we find ways to significantly reduce the cost burden for both consumers and the health care system,” says Mark McClellan, co-chair, LAN Guiding Committee; Director, Robert J. Margolis Center for Health Policy.
“We are encouraged by these results and the great progress being made towards APM adoption,” states Trent Haywood, chief medical officer at the Blue Cross and Blue Shield Association, per the release. “These findings underscore the importance of the public and private sectors working in concert supporting providers towards APM adoption.”
[Source(s): Health Care Payment Learning & Action Network, PR Newswire]