The big announcement this week from Medicare -- setting forth specific targets for a historic shift away from fee-for-service reimbursement in order to reduce costs and improve quality -- is less than it seems.
Medicare has been talking about value based purchasing for decades now, and thus far has taken baby steps towards implementation. Even the strides taken in recent years, and the targets laid out this week for the future, don't really leave FFS medicine in the dust. ACOs and other MSSP innovations don't entirely move away from FFS reimbursement; they just add cost and quality kickers as part of a retrospective reconciliation.
CMS identified four categories of payment and targets related to each of these categories.
- category 1—fee-for-service with no link of payment to quality
- category 2—fee-for-service with a link of payment to quality
- category 3—alternative payment models built on fee-for-service architecture
- category 4—population-based payment