WASHINGTON – Only about 11% of health plan payments to physicians and hospitals are tied to performance or efficiency – meaning that almost 90% of payments are still fee for service, according to a report released March 26 by Catalyst for Payment Reform.
Alicia Ault/IMNG Medical Media
Members of the Catalyst for Payment Reform
The San Francisco–based nonprofit is a collaborative of employers and health plans that advocates the overhaul of the nation’s health care payment infrastructure by encouraging more value-based payment.
Using data provided by commercial health plans, the group determined that 11% of hospital payments, 6% of outpatient specialist payments, and 6% of primary care physician payments are "value oriented."
Of those payment arrangements, 57% involve provider risk such as bundled payment, capitation, and shared risk payment. The remaining 43% provide incentives, such as shared savings or pay for performance.
The main goal of Catalyst for Payment Reform (CPR) is to raise the volume of value-based commercial payments to health care providers to 20% by 2020. Coalition members said that they saw reason for both pessimism and optimism in the report’s findings.
"Obviously, these results are pretty disappointing," said Dr. Robert Galvin, chief executive officer of Equity Healthcare, which buys health care coverage for private equity companies. Even so, the report itself represents "the triumph of transparency," he said at the press briefing. "It is just simply good to know."
Susan Delbanco, executive director of CPR, noted that in 2010, 1%-3% of provider payments were tied to performance. Given the latest information, "it looks to me like we are on a fast track and that we may get there before 2020,"she said.
The group's research also found that about 2% of health plan enrollees are enrolled in an accountable care organization or a patient-centered medical home.
Most health plan payments (about 75%) are still made to specialists, while 25% go to primary care physicians, according to their analysis. Non–fee-for-service payments are still not entirely rewarding or providing incentives to improve the quality of care. Only 35% of those value-based payments have quality of care as a factor.
Dr. Richard Gilfillan, director of the Center for Medicare and Medicaid Innovation at the Centers for Medicare and Medicaid Services, said that the agency was "thrilled" with the report, noting that it showed that private payers were helping encourage a transformation in payment.
"We’re not discouraged – we think that change is happening, it’s underway," Dr. Gilfillan said at the press briefing.
The growing number of physicians participating in new payment models reflects a cultural shift, said Dr. Mark Smith, president and chief executive officer of the California HealthCare Foundation. "I think we have turned the corner on providers recognizing the feasibility, the desirability, and in fact, the inevitability of the kinds of payment reforms that you’ve heard about."
The California HealthCare Foundation and the Commonwealth Fund provided the funding for the National Scorecard on Payment Reform, and a sister effort, the National Compendium on Payment Reform.
The scorecard tabulated data that 57 health plans provided to the National Business Coalition on Health. Participation is voluntary, and not all 57 plans answered all questions posed. The plans represent 104 million people in the commercial group market, or about two-thirds of the total commercially insured population in the United States. Respondents were primarily large health plans, which means the results may not necessarily reflect the entire group market.
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