The transition to value-based payment has accelerated rapidly over the past two years, and payers and providers predict even more dramatic changes.
That’s according to a new survey of 115 payer organizations and 350 hospitals conducted by ORC International and commissioned by McKesson.
The survey, which was also implemented in 2014 on a smaller scale, highlights how the movement toward value-based payment has shifted over the past two years.
Here are three takeaways:
#1. Value-based reimbursement has reached a tipping point
In the survey, respondents had to rate their organization on a value-based reimbursement “continuum.” Fee-for-service only was on one side of a continuum, and value-based reimbursement was on the other.
On average, payers reported that they are 58% along the continuum toward full value-based reimbursement. That’s a 10% increase over the progress payers reported in 2014.
Hospitals are also moving along the continuum. On average, hospital respondents reported that they are at 50% along the value continuum, up 4% since 2014.
When it comes to specific types of value models, payer respondents who said they are currently exploring at least one type of value-based payment model predicted that in five years:
Bundled payments will account for 17% of medical payment (up from the 11% they reported bundles account for currently);
Capitation or global payments will account for 23% of medical payment (up from the 18% they reported capitation or global payments account for currently); and
Pay-for-performance payments will account for 19% of medical payment (up from the 15% they reported these payments account for currently).
Andrei Gonzales, MD, McKesson’s director of value-based reimbursement solutions, says there are several reasons bundled payments are projected to grow faster than other value-based reimbursement models.
“The first is that bundles are a good way to incent value with specialty care,” he says “Other models like shared savings are good at incenting value with primary care. A bundled payment for a well-defined episode of care like a hip replacement or a pregnancy and delivery is an effective way to incent providers to coordinate care across the continuum of the episode.”
In addition, government programs like the Comprehensive Care for Joint Replacement Model, and state programs in Arkansas, Tennessee, Ohio and New York are increasing adoption of bundled payments, says Gonzales.
“As providers and payers become more familiar with the processes needed to manage bundled payments and the benefits through the government programs, more commercial programs will follow,” he says.