SIMPMO: Value-Based Payment

Value-Based Payment
A key enabler of our transformation will be the shift from purely fee-for-service payment, which rewards providers for delivering a greater volume of services, to value-based payment, which rewards providers for delivering high-quality care and a positive consumer experience, while reducing waste and inefficiency. Value-based payment also reduces healthcare costs or better controls the growth in healthcare spending over time.
Implementing these payment changes across all payers strengthens the business case for providers to invest in advanced practice and performance improvement, while eliminating conflicting payer incentives. Based on the guidance from our workgroups and input from stakeholders, and our steering committee, we defined a strategy for value-based payment that comprises the following components:


Two tracks for value-based payment: In our Glide Path model, most providers who are new to value-based payment will begin in Pay for Performance (P4P) [page 178 of the CT Healthcare Innovation Plan], which introduces rewards for performing well on quality and care experience targets. Eventually, all providers, as they achieve the scale and capabilities, will migrate to a Shared Savings Program (SSP) [page 179 of the CT Healthcare Innovation Plan]. A SSP introduces accountability for the overall cost of care for a panel of patients. A practice can share in savings when it provides more effective and efficient care or losses if care becomes less effective and efficient.


Alignment of payers to adopt similar reward structures tied to a common scorecard: Payers will be encouraged to tie SSP and P4P programs to the same common scorecard for quality, care experience, health equity, and cost. This will reduce complexity for providers, increase the business case for investment in new capabilities, and sharpen providers’ focus on specific measures of success supported by all payers [page 176 of the CT Healthcare Innovation Plan].


Payers and providers will independently negotiate the level of outcomes-based bonus payments made under P4P. Similarly, payers and providers will be free to determine whether they want to share in gains and whether they want to share in losses under a SSP arrangement. Arrangements in which providers share in gains but not losses (“upside” arrangements) meet the minimum requirements of our Innovation Plan. Medicaid will establish an upside only shared savings program, although the timing has not been determined.

Content Last Modified on 8/30/2016 9:04:58 AM