Blog | Value-Based Payment

Evolving approach to federal value-based payment models will emphasize equity, affordability

Blog | Value-Based Payment

Evolving approach to federal value-based payment models will emphasize equity, affordability

The Center for Medicare & Medicaid Innovation plans to help providers better prepare to take on downside risk.

Leaders with CMS and the Center for Medicare & Medicaid Innovation (CMMI) have published a rough blueprint of the future of value-based payment (VBP) at the federal level.

As published in Health Affairs, a blog post written by CMS Administrator Chiquita Brooks-LaSure, CMMI Director Elizabeth Fowler and two colleagues lays out a 10-year plan for healthcare policy innovation in broad strokes.

“After launching more than 50 alternative payment models that reward healthcare providers for delivering high-quality and cost-efficient care, the Innovation Center [CMMI] has learned a great deal and is ready to build a stronger and more sustainable path forward,” the authors wrote.

Health equity is a pillar of the new vision, the authors wrote. Whereas previous federal VBP models were evaluated based on whether they lowered costs while maintaining or improving quality — or improved quality while not raising costs — assessments going forward also will examine whether a particular model advances equity.

“Models to date have been largely Medicare-oriented, and voluntary models have primarily drawn only those healthcare providers and organizations with resources and capital to apply and participate, resulting in limited attention to Medicaid and safety net providers,” the authors wrote.

“From here on, the Innovation Center will embed equity in every aspect of its models by seeking to include more providers serving low- and modest-income, racially diverse and/or rural populations; the Innovation Center will aim to ensure everyone has access to providers at the leading edge of transformation.”

Among the approaches to closing gaps will be efforts in areas such as behavioral health, social determinants of health and other facets of whole-person care delivery.

Enhancing affordability for beneficiaries, not just for programs

There also will be more of a focus on using VBP models to address the affordability of care, the authors wrote. Previously, based on the statutory mandate for CMMI, the goal has been to reduce spending for Medicare, Medicaid and the Children’s Health Insurance Program.

Models that strive to make care more affordable for beneficiaries could include features such as cost-sharing waivers for high-value services, the authors wrote, or steps to curb drug prices. Emphasis also could be placed on reducing “low-value care and sources of waste that drive up patient costs.”

To date, affordability has been a primary focus of only a few federal VBP models. Rare examples include the Part D Payment Modernization Model and the Part D Senior Savings Model, the latter of which offers predictable copays for insulin.

Technical changes are in store

Among other lessons learned since CMMI’s 2010 launch, the authors wrote, is the need to streamline the portfolio of federal VBP models and to emphasize mandatory models. CMMI also will focus on improving benchmarking and risk adjustment.

The authors noted the importance of supporting model participants in transitioning to downside risk through steps such as:

  • Developing and investing in tools and care delivery approaches to help providers succeed in delivering person-centered care
  • Providing more real-time data to support care decisions
  • Creating payment rule waivers to increase flexibility
  • Developing approaches to improving outcomes for specific populations or interventions to close quality gaps

The concept of accountable care should measure outcomes “that matter to patients,” the authors wrote, citing functional status and patient-reported outcomes as examples. Beneficiary and patient input on models will be solicited more directly throughout the process of implementing and evaluating VBP models.

About the Author

Nick Hut

is a senior editor with HFMA, Westchester, Ill. (

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