Scorecard: Less Than Half of Medicare Payments Tied to Value

scorecard on Medicare payment reform released this week shows progress in transforming Medicare into a results-oriented payer of health services, but there is much ground left to cover, according to the report.

Some 42% of the $360 billion in Medicare fee for service provider payments in 2013 were tied to improving value. Comparatively, 58% of dollars paid to providers that year had no quality or value component at all, according to the Catalyst for Payment Reform, a San Francisco-based not-for-profit, which produced the scorecard.

Using 2013 data from the Centers for Medicare and Medicaid Services, the scorecard showed a breakdown of value-based payments: 

  • Medicare pay-for-performance programs represented 32.8% of value dollars paid;
  • Shared savings programs represented 11.8% of value dollars paid; and
  • Pioneer accountable care organizations, or “shared risk” programs, represented less than 2% of value dollars paid, according to the scorecard.

The report did not include Medicare Advantage plans.

In California, 32 Medicare shared savings programs are under way, while three groups are participating in Medicare’s Pioneer ACO program.

“We are really in an era of experimentation at this point,” said Suzanne Delbanco, executive director of Catalyst for Payment Reform.

Comparatively, a prior report by the group on private payer value programs found that 40% of commercial insurance payments in 2013 were based on value — about on par with Medicare.

The federal government has set a goal of tying 50% of traditional fee-for-service Medicare payments to quality or value by 2018.

Niall Brennan, chief data officer of the CMS, which provided the data for the scorecard, said the agency has made progress in recent years to tie value to provider payments.

“We are always pushing the envelope in numerous and different ways around cost transparencies,” Brennan said, adding that this includes further projects on medical homes and episode-based payments.

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