Value-Based Payment Will Change Practice, Reimbursement

The notion that the American health care system should transition from paying for volume to paying for value has become nearly ubiquitous.

Writing in an online blog recently for the journal Health Affairs, four distinguished health economists noted that value-based payment is no longer a passing trend—it is where the health care system of the future is headed.

“There is a broad consensus that health care providers should be paid more if they deliver higher value care—that is, care that results in substantial health gains per dollar spent,” wrote Nancy Beaulieu, Ph.D., a research associate at the Department of Health Care Policy at Harvard Medical School, and colleagues in the blog post “The Economics of Paying for Value” (March 15).

The movement toward value-based payment began more than 20 years ago, but in recent years it has gathered momentum with a proliferation of value-based payment programs in both the public and private sectors. These changes encompass dramatic reforms in the way physicians participating in Medicare and Medicaid will be paid and the emergence of a variety of new models of care by which physicians can organize themselves to deliver value-based care.

The movement has greatly accelerated since the passage of the Affordable Care Act (ACA) but has also been driven by technological change—especially the growth of electronic health records (EHRs) and payer incentive programs to encourage proliferation of EHRs. And some changes—especially the federal mental health parity law and provisions in the ACA requiring parity coverage of treatment for mental and substance use disorders—are especially relevant to psychiatrists.

The goal of this evolution is summed up in the so-called Triple Aim: better patient experience of care, lower per capita cost of health care, and improved population health. Altogether, this movement toward value-based payment represents a profound sea change in American medicine, requiring physicians to take specific actions and make substantive changes in the way they practice.

In the coming months, Psychiatric News will concisely but comprehensively cover all of the important components of this movement in a series of articles under the theme “Changing Practice/Changing Payment.” Topics will include the following:

• Medicare Access and CHIP Reauthorization Act (MACRA): MACRA represents a major turning point in Medicare payment policy and quality programs. Over 23,000 psychiatrists provided services to Medicare patients in 2013. Several MACRA provisions also impact Medicaid, other federal programs, and potentially some private payers.

• The Merit-Based Incentive Payment System (MIPS): MIPS will replace current programs and penalties. Performance assessment under MIPS is designed to be more flexible than under current programs, with performance thresholds based on the average performance of one’s peers.

• Alternative payment models (APMs): Under MACRA, physicians with sufficient revenue (or patients) tied to “eligible” APMs can earn bonuses and may not have to report under MIPS. Psychiatric News will examine MACRA requirements for APMs and how they may work for physicians and patients.

• Electronic health records: Quality reporting requirements are linked to the adoption of EHRs. Psychiatric News will outline the requirements and how they may affect reimbursement and practice.

• Integrated care: Models of integrated care have become central in the push toward value-based care and are ingrained in many of the federal initiatives that are changing how physicians are paid.

Importantly, the “Changing Practice/Changing Payment” series will outline specific actions that APA members will need to take to stay current with the movement toward value-based care. And it will also highlight the specific ways that APA’s divisions of Policy, Programs, and Partnerships and Government Relations are working on behalf of members to advocate for their best interests as the health care system evolves and to help members meet the requirements of public and private payers.

“All of us today are practicing in a health care system undergoing dramatic transformation,” said APA President Renée Binder, M.D. “While much about the traditional practice of medicine will endure, many other aspects of how we care for our patients and how we get paid for that care are changing. The goal of these changes is better, more comprehensive patient-centered care that contributes to a healthier population at lower cost. For our patients with psychiatric illness, new models of care could prove to be especially advantageous—particularly models of integrated and collaborative care that are better able to meet the general medical as well as psychiatric needs of individuals who often have multiple chronic conditions.

“Some of these changes are occurring very rapidly; others are more incremental,” she said. “APA leadership and staff are closely monitoring these developments and working diligently with legislators and regulatory agencies to ensure that quality patient care, which depends on the doctor-patient relationship, is safeguarded.

“APA members can look forward to the Psychiatric News series ‘Changing Practice/Changing Payment’ as a source of useful information about all of these changes and how APA is helping to shape them to the benefit of members and their patients.” ■