HHS Declares Value-Based Purchasing Goals: Implications for the Health Care Industry

BNA Insights: Health Law Resource Center

Bob Atlas, President of EBG Advisors, Inc., authored an article in BNA Insights: Health Law Resource Center, titled “HHS Declares Value-Based Purchasing Goals: Implications for the Health Care Industry.”

Following is an excerpt (see below to download the full article):

On January 26, 2015, Secretary of Health and Human Services (HHS) Sylvia M. Burwell announced time-specific quantitative goals for Medicare to pay providers based on “quality, rather than the quantity of care they give patients.” The announcement presented no new payment concepts, but it did articulate definitive goals as to the percentage of Medicare fee-for-service payments that will be made under value-based models such as accountable care organizations (ACOs) and bundled payments.

In 2014, Medicare fee-for-service payments totaled $362 billion or about 12 percent of all U.S. national health expenditures. With that much weight held by one payer, the Secretary is betting that, as Medicare goes, so will go much of the health care industry.

Indeed, in coordination with the HHS announcement, a newly formed coalition comprised of 20 health systems and payers and calling itself the Health Care Transformation Task Force released a vision to change payment to “incentivize and hold providers accountable for the total cost, patient experience and quality of care for a population of patients, either across an entire population over the course of a year or during a defined episode that spans multiple sites of care.” One shared aim of HHS and the private sector groups is to adopt uniform models and metrics so as to minimize the burden on providers as new payment models are deployed.