HHS reaches goal of tying 30 percent of Medicare payments to quality ahead of schedule

A major milestone in the effort to improve quality and pay providers for what works.

Thanks to tools provided by the Affordable Care Act, an estimated 30 percent of Medicare payments are now tied to alternative payment models that reward the quality of care over quantity of services provided to beneficiaries, HHS announced today. Today’s announcement means that over 10 million Medicare patients are getting improved quality of care by having more time with their doctors and better coordinated care – nearly a year ahead of schedule.

The Affordable Care Act established tools such as the Medicare Shared Savings Program and the Center for Medicare and Medicaid Innovation, which tests a number of alternative payment models for achieving better care, smarter spending and healthier people. Alternative payment models are ways for Medicare to reimburse providers based on the health of the patient and quality of care rather than the number of services provided. Examples include accountable care organizations (ACOs), advanced primary care medical homes, and new models that bundle payments for episodes of care.

In January 2015, the Administration announced clear goals and a timeline for shifting Medicare reimbursements from quantity to quality, setting a goal of 30 percent of Medicare payments through alternative payment models by the end of 2016. With the January 2016 announcement of 121 new ACOs as well as greater provider participation in other models, HHS today estimates that it has achieved that goal well ahead of schedule.

“Improving the quality and affordability of care for all Americans has always been a pillar of the Affordable Care Act, alongside expanding access to health care,” said HHS Secretary Sylvia M. Burwell.
“The law gives us the tools to put patients at the center of their care, improve quality and help make care more affordable over the long term.”

Previously, any patient who had multiple doctors experienced the frustration of fragmented care: lost or unavailable medical charts; duplicated conversations, medical procedures and tests; difficulty scheduling appointments. Thanks to the Affordable Care Act, Medicare beneficiaries in alternative payment models, such as ACOs, have better control over their health care, and providers have better information about their patients’ medical history and better relationships with their patients’ other providers. Doctors and other clinicians can focus on care coordination to ensure patients, especially those with chronic conditions, get the right care at the right time while avoiding medical errors and duplication. Under alternative payment models, providers have an incentive to coordinate care inside and outside the doctor’s office, by helping patients with their medications, communicating about upcoming appointments and expectations, and talking with the other members of the patient’s care team.

Today, there are 477 Medicare ACOs participating in the Shared Savings Program and the Pioneer ACO Model combined. In 2014, these programs generated a total net savings of $411 million.

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