The Health Care Payment Learning and Action Network (HCP LAN) is committed to shifting the health system from volume, pay to services, to alternative payment methods (APM). While there are many different types of APMs, to a large extent, all of them transfer a significant financial risk to providers and link back to quality care. Instead, the HCP LAN aims to have 100% Medicare and Medicare Advantage returns fall under the risk of two-part APMs and 50% retail sales with Medicaid falling under a two-party APMs risk by 2025.
HCP LAN defines APMs if they fall under four categories:
In their 2020-2021 report called APM Measurement: Progress of Alternative Payment Models, HCP LAN uses data from 2019 and 2020 to see if APM is gaining market share. From 2019 to 2020, we see another shift to more APM and full-time payments, but FFS payments stabilized at 39.3% of the return. It should come as no surprise that the refunds have not changed much since 2020 was the length of the COVID-19 epidemic.
Prices for using APM also vary on payment types. Traditional Medicare had the highest use of APMs (for example, reimbursement in HCP LAN 2, 3 or 4 groups), and commercial insurance was very low (see photo below). Note that global revenues were unusual for high payers (3% -6%) with the exception of Medicare Advantage whereas 21.8% of payments were made through a global brand.
HCP LAN also surveyed payers and found that 87% believed that APM services would increase in the future. The main interest rate was on the combined income (47%) and the amount shared (21%) of APM types. Apparently, about half (44%) of those surveyed believed that APMs had facilitated the integration of support.
While payers are happy with the financial assurance that APMs can bring, providers are concerned. The top three challenges in setting up APMs were:
- The donor’s willingness to take financial risk
- The agent can use APM
- Interest in giving / preparing
APM has a number of visuals, as well as complex ones. Clearly, reconciling returns to quality of care with value is a desirable goal. However, price comparisons are much easier in a fixed position where the expected results and costs are determined by the appropriate certainty. As a result of COVID-19, there was significant uncertainty over pricing due to the direct cost of COVID-19 and its impact on the treatment of certain diseases. It is not to say that global epidemics make implementing APMs difficult. Similarly, as new therapies enter the market, behavior may improve but may be costly; as medical care changes value perceptions – and related APMs – may need to change over time.