Alternative Payment Models Made Clear

Alternative Payment Models Made Clear

By the billing experts at Main Street Medical Consulting

We’ve been talking quite a bit about the impending MACRA changes on the Main Street Medical Consulting Blog.  You can see an overview of these changes here, and learn more about the Merit-Based Incentive Payment System (MIPS) here.  In this post we are going to take a look at the Advanced Alternative Payment Models or APMs created by MACRA.

Advanced Alternative Payment Models deviate from the traditional medical billing services model for doctors and clinicians serving patients enrolled in Medicare.  In the previous system, the reimbursement payments were issued based on the number of patients treated, rather than the quality of care provided.  This lead to a result of a higher volume of patients being treated quickly, rather than in the highest quality of care, in the most cost effective manner.

What are Alternative Payment Models?

Alternative Payment Models or APMs are groups of healthcare providers that join together around a certain set of rules for their reimbursement payments.  All of the providers in each of these groups strive to offer the best quality care, at the lowest cost to both the healthcare provider and the patient, and then shares their achievements with the group so that every organization within the group benefits.  Collectively the group adheres to a certain set of rules that help each physician and clinician achieve this goal.  Collectively these APMs are working to lower the cost of care for patients enrolled in Medicare and Medicaid.

Types of APMs:

  • Medicare Shared Savings Programs
  • Innovation Center Models
  • Demonstration Under the Health Care Quality Demonstration Program
  • Demonstration Under Federal Law
  • Physician Focused Payment Model

What are Advanced Alternative Payment Models?

These groups assume more risk, but offer a higher potential reward.  CMS has stated that there is a potential for organizations enrolled in these programs to receive an additional 5% payment. These are APMs that require members or participants to utilize certified Electronic Health Record or EHR technologies.  These Advanced APMs use a composite score system similar to the one we discussed in the MIPS blog post.

Types of Advanced APMs:

  • Comprehensive Primary Care Plus
  • Next Generation ACO Model
  • Shared Savings Program Track 2
  • Shared Savings Program Track 3

For more types and information on each of these APMs Click Here.

How Do you Know Which APM is Right for Your Health Care Practice?

The Centers for Medicare and Medicaid has established an Innovation Center to help assist healthcare providers determine in which Alternative Payment Model or Advanced Alternative Payment Model to enroll, among a list of other services and information.

Additional Resources:

APM Methodology Fact Sheet – published by CMS to fulfill their promise of providing predictive methodologies, based on previous health care performance data and scoring.

Quality Payment Program Website – a resource for understanding and participating in the Quality Payment Program, created and maintained by CMS.