Current and Emerging Payment Models

The Center for Medicare & Medicaid Services has set a goal of increasingly tying Medicare payment to value. For example, CMS estimated that, as of January 1, 2016, nearly a third of Medicare payments were attributed to alternative payment models. Thus, for now, hospitals and health systems must exist in both the fee-for-service and value-based worlds. Specifically, they need to continue to serve and operate under the traditional, siloed payment systems, such as Medicare's inpatient and outpatient prospective payment systems.

However, they also must begin to determine how they will take financial accountability for the quality and costs of an entire episode of care or attributed population, such as under the Comprehensive Care for Joint Replacement bundled payment or Accountable Care Organization programs.