CMS Actively Courting Private Payors to Join Transition to Pay for Performance Models, JAMA

CMS logoCMS is clearly moving away from direct fee-for-service towards more outcome-oriented, quality based payment models for Medicare, Medicaid and CHIP programs.  Now JAMA reports in a recent article  that CMS is actively engaging other payors to participate in the transition.  Other payors have historically followed CMS with new payment strategies once the benefit was clear.  The transition to the inpatient prospective payment program in 1983 is a good example of private payors waiting, watching and then implementing on their own initiative with little to no impetus from the government.  What appears to be different this time is that now CMS is actively courting private payors to participate in the next generation payment programs.  This effort appears to be in recognition that in order for these new payment programs to be successful, payment systems need to be consistent in order to provide adequate incentive for providers to change their processes and make the investments required to support population management initiatives.  Examples of this new outreach include the Comprehensive Primary Care Initiative where CMS “convened private payors in 7 markets around the nation to make voluntary coordinated investments in approximately 500 primary care practices.”  Also, participants in the Pioneer ACO program are required to have at least 50% of their revenue across all payors based on outcomes-oriented contracts that “link payment to quality and value.”

What is clear is that “CMS aims to move an increasingly large share of total payments to clinicians and organizations from fee-for-service with no link to quality to models that reward quality and efficiency in care delivery and to continue to learn how best to incentivize better health outcomes and lower costs.”

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