Guide to Value-Based Reimbursement: Profiting from Payment Bundling, PHO Shared Savings, and Pay for Performance (PDF)

September 2013 PDF (60 pages)

Healthcare Intelligence Network

In healthcare's post-reform volume-to-value world, payor reimbursement strategies are tipping in favor of providers who can deliver the clinical and financial goods. In the mix are bundled payments, shared savings, pay for performance and bonuses — with some going so far as to restructure organizations for maximum gain. The Guide to Value-Based Reimbursement: Profiting from Payment Bundling, PHO Shared Savings, and Pay for Performance explores emerging models of episode-based payments, physician-hospital organizations and physician bonus structures.


Highlights from the guide include:

  • Jay Sultan, associate vice president and chief product portfolio architect for TriZetto®, provides perspectives on payment bundling, including definitions of key elements, advice for payors and providers, what's ahead in bundled payments for primary care, and examples of the payment model at work in one organization. An advisor to participants in CMS's Acute Care Episode (ACE) demonstration, an earlier test of episodic payments, Sultan also describes a bundled payment collaboration between two surgical groups that has not only reengineered every aspect of care but also generated significant savings for the groups.

  • Next, deconstructing the physician-hospital organization (PHO) model are Healthcare Strategy Group thought leaders Travis Ansel, MBA, manager of strategic services, and Greg Mertz, MBA, FACMPE, director of consulting operations, Healthcare Strategy Group. The two guide healthcare executives through the seven critical areas of PHO development, from defining the PHO mission to creating a data environment conducive to registry use, analytics and active patient management. Also described are the changing payor environment and incentives available to providers, offering practical considerations for creating a culture of collaboration with the PHO and engaging both providers and employers in this emerging model.
  • On the subject of physician pay-for-performance and realistic bonus structures, Julie Hobson, RN, BSN, manager of provider engagement, performance and partnership at Highmark Inc., describes the evolution of Highmark's program to meet today's healthcare market realities. Highmark's 6,300 enrolled primary care physicians can earn bonus payments across six measure sets — a broad spectrum of measures from clinical and quality measures to prescribing habits, access to care and level of technology use. In addition, practices can also qualify for a bonus payment based on development or improvement of a Best Practice evidence-based quality improvement project.

  • Q&A section answers 35 queries on the reimbursement strategies presented in this resource
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Table of Contents

  • Moving Forward with Payment Bundling
    • Why Bundled Payments?
    • The Trend of Episodic Payments
    • Bundled Payment Success Stories
    • Impact of Bundled Payments on Patients
    • Prospective Versus Retrospective Payments
    • Challenges for Payors
    • Advice for Payors Considering Bundled Payments
    • Challenges for Providers
    • Legal Considerations and Risk Sharing
  • Physician Hospital Organizations: Developing a Collaborative Structure for PHO Shared Savings Agreements
    • Defining Shared Savings
    • Moving to a PHO Shared Savings Model
    • Differentiating the PHO from the ACO
    • PHO Structure
    • Legal Considerations for PHOs
    • The Right Physicians for PHOs
    • Population Health Management in the PHO
    • Creating a Culture of Collaboration in the PHO
  • Physician Pay for Performance: Refining the Bonus Structure To Meet Market Realities
    • PFP Participation Requirements
    • Program Metrics
    • 6 Elements of Best Practices Project
    • Restructuring for Meaningful Use
  • Q&A: Ask the Experts
    • Statistical Variation in Setting Performance Goals
    • Bundled Payments for Primary and Specialty Care
    • Risk Stratification within an Episode of Care
    • Trialing the Bundled Payment Model
    • Defining the Bundles
    • Administration of Provider Payments
    • Obtaining Reliable PHO Data
    • Value-Based Compensation Models
    • Example of Early Shared Savings Adoptors
    • Potential Purchasers of PHO Packages
    • Engaging Physicans in Value-Based Models
    • Minimizing PHO Complexity
    • Cost Reduction Strategies
    • Demonstrating PHO Performance
    • Performance Measurement Tools
    • Shared Savings at Highmark
    • Methodology for Bonus Distribution
    • Timeline for Pay for Performance Deployment
    • Evaluating HEDIS Benchmarks
    • Sharing Performance Data with Highmark Physicians
    • The Risk of Non-Compliant Patients
    • Consistency of Physician Practice Measures
    • PFP Versus FFS Reimbursement
    • Highmark's Best Practice Case Studies
    • Support for Participating Practices
    • Feedback from Highmark Physicians
    • Highmark Network Benchmarks
    • Measuring Meaningful Use Improvement
    • Engagement in Program Rollout
    • Highmark Incentives
    • Obtaining Highmark Practice Data
    • Reducing Fall Risk for Seniors
    • Future Outcomes Measures
    • Future Highmark PFP Improvements
    • PFP Best Practices and Success Metrics
  • Glossary
  • For More Information
  • About the Speakers