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September 2013 St@teside

Payment Reform Resources

Payment reform is a crucial component of any successful strategy to control costs and deliver high quality care. However, the complexities of payment reform  make any implementation effort a daunting task. With the support of the Robert Wood Johnson Foundation, several key resources are now available to offer guidance on how to address some of the difficult questions inherent in any payment reform effort, including:
  • What is the end goal of the payment reform?
  • What type of reform is appropriate for the market?
  • Who should participate in the payment reform implementation?
  • How can stakeholders work together transparently and legally?
  • What data are needed to inform any reform?
Facilitators and Barriers to Payment Reform: Market-based, Governmental, Organizational, and Design Considerations
Authored by Michael Bailit and Megan Burns of Bailit Health Purchasing, LLC, this issue brief explores four categories of facilitators and barriers to a payment reform effort. As outlined in the brief, these four categories are:
  • Market-based: the composition and qualities of the marketplace, including qualities of key market participants (e.g., payer, provider, and purchaser); 
  • Governmental: the role of the state as a convener of payment reform, a regulator of health care, and/or a purchaser of health care; 
  • Organizational: the characteristics of the organization(s) leading or simply participating in the effort, including their internal structure and external influence; and 
  • Design: the construction of the payment model itself, including its characteristics, relative complexity, and potential impact.
Various aspects of each category are described, and the potential for each facilitator or barrier to respond to policymaker influence is also noted. The information in the issue brief is helpful as communities undertake an initial scan of their current health care payment and delivery systems and decide how/whether to move forward and design a payment reform effort.
Legal Issues in Designing Bundled Payments and Shared Savings Arrangements in the Commercial Payer Context
In many cases, bundled payments are a powerful payment reform that can help move a market towards the goal of delivering high quality, low-cost care. A bundled payment refers to a single payment, or “bundle,” for all of the services related to a single episode of care (for example, paying for all of the pre-surgical workup, surgical procedure, and subsequent rehabilitation for a knee replacement in a single, bundled payment). While it can seem as if bundled payments would be relatively straightforward to structure and implement, there are potential legal barriers – at the state and federal level – that can create difficulty in moving forward. 
This report provides guidance and templates to help organizations work with commercial payors to develop successful and compliant bundled payment and shared savings arrangements.
What Kinds of Data and Analyses Are Needed to Support Successful Payment and Delivery Reform?
On September 13, AcademyHealth hosted a webinar entitled: What Kinds of Data and Analyses Are Needed to Support Successful Payment and Delivery Reform? 
One of the biggest barriers faced by physicians, hospitals, health plans, purchasers, and consumers as they pursue payment and delivery reform efforts is accessing the right types of data and data analyses. During this webinar, attendees learned how to access different types of data (including claims data, clinical data, and patient-reported outcomes, among others), and how to use data effectively to support their payment reform efforts. Regional Health Improvement Collaboratives, Health Information Exchanges, states, and the federal government can play important roles in facilitating the ability of various stakeholders to obtain and use data effectively for payment and delivery reform, but it is important to obtain the right kinds of data and make them available in the right ways. Harold Miller, President and CEO of the Center for Healthcare Quality and Payment Reform and consultant for the Network for Regional Healthcare Improvement, described the key types of information needed during the planning stage of payment reform initiatives, the design/pricing stage, and the implementation stage. He also provided specific examples of how data can be used to support payment and delivery reform efforts.
Jay Want, M.D., advisor to the Network for Regional Healthcare Improvement and President of Want Healthcare LLC., then discussed the importance of trust between the providers and users of data. Dr. Want described how trusted relationships can help ensure that information is used effectively for improvement, and can overcome barriers to transformation. He also detailed concrete examples of how to build trust among stakeholders who are not used to collaborating.
The archive of this event – including slides and audio recording – is now available on AcademyHealth’s website