New Payment and Delivery Models
Private and public payers test new ways of paying for health care and delivering health care services. The new payment and delivery models are designed to limit costs and improve quality of care. They are often based on traditional fee–for–service payments but use incentives to make providers more responsible for costs of care they deliver by shifting financial risks onto physicians. To learn more about each model please click on headings below.
Bundled Payments (Episode Payments)
A single payment for all services needed during a defined episode of care. A bundled payment is a single fee shared among all of the providers who rendered services during a defined episode of care.
Read more about bundled payments.
Comprehensive and Global payments
A single payment for all services needed by a patient during a specific period of time. In contrast to bundled payments, comprehensive payments spread across many episodes of care.
Read more about comprehensive payments.
Shared SavingsA form of financial incentive, where providers can share among themselves savings they achieve if the actual total cost of care they provided is lower than targeted total cost of care.
Read more about shared savings.
Pay for Performance
A payment tied to physicians’ performance on a defined set of quality measures. Usually, pay for performance is an additional payment on top of traditional fee–for–service.
Read more about pay for performance.
Pay for Reporting (Incentive Programs)
An incentive payment for reporting with Medicare electronic prescribing program (eRx), and reporting on a set of quality measures with Physician Quality Reporting System (PQRS), or for demonstrating meaningful use of Electronic Health Records (EHR).
Read more about pay for reporting and Incentive Programs.
Accountable Care Organizations
Accountable care organizations (ACOs) are composed of a network of providers – e.g. physicians, hospitals, and nurses – that agree to be accountable for the quality and costs of care delivered to a defined population of patients.
Read more about Accountable Care Organizations.
Patient Centered Medical HomeAn enhanced coordinated care delivery model designed to meet the needs of patients with chronic conditions. This model is tailored mostly to primary care but recently has been extended to include some specialty care as well.
Read more about Patient Centered Medical Homes.
- AMA Accountable Care Organizations Resources
- Centers for Medicare and Medicaid Innovation website
- AMA Evaluating and Negotiating Emerging Payment Options
- Harold D. Miller: Pathways for Physician Success Under Healthcare Payment and Delivery Reforms
- Mark McClellan—Reforming Payments to Healthcare Providers: The Key to Slowing Healthcare Cost Growth While Improving Quality?
- CMS Innovation Center Launches $1 Billion Initiative to Fund New Delivery/Payment Models
- AAN Weighs in on Physician Payment Reform (August 2012)
- Funding Available by CMS to Test Care Transition Models in Medicare (July 2012)
- Over One Hundred Accountable Care Organizations (ACOs) (July 2012)
- Neurology Projects Receive Innovation Funding (May 2012)