Providers Need to Engage in Payment Reform to Prevent Payment Reductions

KANSAS CITY, MO., February 21, 2019 - Caravan Health and Margaret Mary Health recently published a whitepaper exploring the effect of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) on community hospitals. Health providers could face serious reductions in Medicare payment rates unless they engage in delivery system and payment reform efforts. Providers must make a plan to understand these new rules and avoid financial distress.

Our health care system is in a transition from fee-for-service to fee-for-value payment. In 2015, this transition took a big step forward with the passage of the Medicare Access and CHIP Reauthorization Act, which repealed the Sustainable Growth Rate formula for physician payment and established the Quality Payment Program (QPP). The QPP allows providers to participate in an alternative payment model (APM) which pays incentives for high quality and cost-ecient care. In short, APM participation maximizes Medicare reimbursement. More than half of providers nationwide are now participating in APM programs.

The new whitepaper explains that Medicare Shared Savings Program accountable care organizations (ACOs) are a prudent option for community health systems seeking to avoid payment reductions while maintaining quality of care. These ACOs are the most common type of APM, counting about one-third of fee-for-service patients, providers and hospitals in 2018. ACO participation works especially well for hospitals because they employ many of the nation’s physicians as well as nurses that can implement population health measures that have been shown to improve care quality.

“Caravan Health has found the key to, not just surviving, but thriving in this new world of value-based payment,” said Lynn Barr, Caravan Health CEO and Founder. “A Caravan Health Collaborative ACO brings independent health systems together to introduce new population health measures that lead to better patient care and financial success. An ACO with more covered lives leads to more predictable and sustainable results.”

“As part of a Caravan Health ACO, we are reaching the promise of value-based payment,” said Tim Putnam, President and CEO of Margaret Mary Health, a critical access hospital in Batesville, IN. “Since implementing new population health measures, the change in approach has been evident for our clinicians and patients. I truly believe it helps our patients lead more healthy lives.”

Download the whitepaper to learn more.
Caravan Health will also hold an interactive webinar to discuss options for community health systems. Join the discussion on February 28 at 10am PT/12pm CT/1pm ET. 

Register here

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