Show Us the Merit Alternative payment models are the way of the future. Here’s what you need to know. Bottom Line
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Bottom Line  |   December 01, 2016
Show Us the Merit
Author Notes
  • Daneen Grooms, MHSA, is director of ASHA health reform analysis and advocacy. dgrooms@asha.org
    Daneen Grooms, MHSA, is director of ASHA health reform analysis and advocacy. dgrooms@asha.org×
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Speech, Voice & Prosodic Disorders / Hearing Disorders / Healthcare Settings / Practice Management / Bottom Line
Bottom Line   |   December 01, 2016
Show Us the Merit
The ASHA Leader, December 2016, Vol. 21, 30-31. doi:10.1044/leader.BML.21122016.30
The ASHA Leader, December 2016, Vol. 21, 30-31. doi:10.1044/leader.BML.21122016.30
One of the most talked-about aspects of health care reform is alternative payment models, a catch-all phrase that covers just about any reimbursement method that factors in quality of care and lower costs.
But what, exactly, are alternative payment models (APMs)?
APMs are alternatives to traditional fee-for-service reimbursement. In APMs, providers receive reimbursement from third-party payers (health insurers, Medicare and Medicaid, for example) based on the quality and/or efficiency of the services they deliver to patients. Fee-for-service plans provide reimbursement based on the volume of services. Public and private health insurers are moving toward APMs in an effort to reduce costs and improve the quality of patient care. Under APMs, all health care providers—including audiologists and speech-language pathologists—are held accountable for the increased quality and lower costs of the care they provide.
The trend by Medicare, Medicaid and other insurers to promote APMs underscores the need to link interventions to meaningful functional goals—not just to help patients, but also to demonstrate the value of the services to payers. It is essential for audiology and speech-language pathology to ensure measurable treatment outcomes are available and included in determinations of value in health care delivery and payment reform.
Although third-party payers have mostly focused on physician services, APMs may also include the services of audiologists and SLPs.

It is essential for audiology and speech-language pathology to ensure measurable treatment outcomes are available and included in determinations of value in health care delivery and payment reform.

Types of APMs
Examples of APMs include:
Accountable care organizations (ACOs). Providers form a network that assumes accountability for the entire cost and quality of care for its patients. ACOs manage all the patient’s health care needs by coordinating the services its providers deliver in various settings. The network receives reimbursement based on targeted cost and quality metrics.
Bundled payments. Health insurers pay a provider—a hospital, for example—a single fixed payment for an “episode of care.” An episode of care refers to all the services provided to a patient with an identified condition (stroke, for example) within a specific time period across a continuum of care.
Patient-centered medical homes (PCMHs). This model uses a traditional care-delivery model, enhanced by care coordination and communication between the primary care physician and other treating providers, to improve the patient’s health outcomes. The goal is to minimize fragmentation of information among providers. According to information from the National Academy for State Health Policy, Medicaid programs in 24 states use the PCMH model.
Medicare: Comprehensive Care for Joint Replacement (CJR) Bundled Payment
Medicare recently began testing a bundled payment that measures quality for an “episode of care” associated with hip and knee replacements. This demonstration project runs in 67 geographic areas from April 1, 2016, through Dec. 31, 2020. The “episode of care” begins when an eligible Medicare beneficiary is admitted to an acute-care hospital with either of two diagnosis codes (major joint replacement or reattachment of lower extremity, with or without complications) and ends 90 days after discharge from that hospital. Participation is mandatory and providers cannot opt out.
In this model, the hospital assumes all of the financial risk associated with providing all needed services to the patient, from surgery to post-hospitalization rehabilitation. The goal is to encourage hospitals, post-acute-care facilities and other providers to work together to improve the quality and coordination of the patient’s care. SLPs working in skilled nursing facilities (SNFs) in Asheville, North Carolina, are participating in the CJR bundled payment model, providing any communication-, cognition- and swallowing-related speech-language treatment associated with complications of the procedure or with chronic conditions that may be affected by the procedure.
In this model, hospitals may more carefully scrutinize audiology and speech-language pathology services. To operate successfully, the hospital’s discharge planner must communicate to the SNF’s rehabilitation department when a patient is covered by the CJR bundle. This information ensures that the patient is evaluated on the first day of facility admission so that treatment can begin promptly.
Given the increased financial pressure, SLPs in Asheville report that the discharging hospital is asking them to shorten the lengths of stay for these patients when clinically appropriate.
For more information on the CJR model and the list of the 67 geographic areas, visit the Centers for Medicare and Medicaid Services’ (CMS) website.
Medicare: Proposed bundles
Medicare has proposed bundled payment demonstration projects for episodes of acute myocardial infarction, coronary artery bypass graft, and surgical hip/femur fracture to begin in July 2017 in selected geographic areas. Similar to the CJR bundle, these episodes of care will be triggered by a Medicare beneficiary’s admission to an acute-care hospital with one of the specific diagnosis codes and will end 90 days after discharge from that hospital. Speech-language treatment is specifically included in the proposed rule, and audiology services are expected to be included as well.
For more information on the proposed bundles, visit the CMS website.
Arkansas: Medicaid and BlueCross BlueShield’s Patient-Centered Medical Home Initiative
In Arkansas, the PCMH initiative by the state’s Medicaid and Arkansas BlueCross BlueShield programs modifies several therapy and behavior health processes in participating pediatric clinics. The PCMH focuses on care coordination among providers and patient engagement; participating pediatricians have adopted a “checks and balances” approach for patients ensuring, for example, that evaluations for speech-language services and physical and occupational therapy are independent of subsequent treatment services.
Specifically, the pediatric clinics require children newly referred for treatment to choose one provider for their initial evaluation and a different provider for treatment. After the initial evaluation, the pediatrician discusses the findings with the patient and family prior to approving a referral for treatment.
Ongoing and open communication between the physician and speech-language pathologist or audiologist is key to successful participation in a PCMH, so that physician and therapy providers can fully understand the patient’s care needs as well as how they can help one another meet those needs efficiently and effectively.
For more information on the Arkansas PCMH Initiative, visit the Health Care Payment Improvement Initiative’s website.
Vermont: All-Payer Accountable Care Organization
Vermont passed legislation in May 2016 to implement a demonstration project for an all-payer model. Under this value-based arrangement, effective Jan. 1, 2017, through Dec. 31, 2022, Medicare, Medicaid and private insurance will pay health care providers participating in the statewide ACO the same rate for certain services. Payment arrangements under consideration include population-based payments and global capitation. Fee-for-service payments would be scrapped. This model encourages integration of health care providers across settings, including hospitals, private practices and post-acute-care facilities and supports coordination of patient care and care transitions. Audiology and speech-language pathology services are eligible services in the ACO, as are home health and skilled nursing facility care.
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December 2016
Volume 21, Issue 12