Performance Incentives and Payment Policies: Are we Addressing the Right Issues?

Don Casey MD, MPH, MBA Don Casey MD, MPH, MBA
Chief of Clinical Affairs

This three-part blog series covers topics of importance to population health initiatives in the U.S. today and shows examples of organizations that are successfully incorporating these efforts to improve value-based care. Read our first post here, covering the importance of better price transparency and the second post here, discussing value-based population healthcare and social determinants of health.

Part 3: Performance Incentives and Payment Policies: Are we Addressing the Right Issues?

By Don Casey, MD, MPH, MBA, Senior Vice President and Chief of Clinical Affairs, Medecision

As the American health system continues to expand value-based care initiatives, performance-based payment policies are becoming better aligned to achieve the “Quadruple Aim”—improving the health of populations, enhancing the patient experience, decreasing the cost of care, and achieving joy and well-being among care teams—for local communities across the nation.

According to the Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma, CMS intends to soon release a new round of value-based payment models, which will include four key components. Based on the “Four P’s,” these components include:


  1. Patients as empowered consumers

Engaging healthcare consumers continues to be both the greatest opportunity and challenge for health systems focused on achieving better health status at lower cost. To be successful, it is critically important for multidisciplinary care management teams to develop and implement individualized, patient-centered care plans through shared decision making. Such efforts can also be highly effective in reducing out of network referral patterns and subsequent “surprise medical bills,” thereby assuring a great patient experience. Additionally, the international healthcare industry is now in a new phase of discovering how digital health tools such as those capturing biometric and financial information that is transmittable to patients and their providers in real time, can further empower consumers.


  1. Physicians, nurses and other health professionals as accountable patient navigators

The most successful value-based population health models take the non-value added burdens away from expert clinical teams, whose primary focus is stellar, comprehensive care coordination—regardless of the delivery setting. As previously discussed in part 2 of this blog series, paying close attention to non-medical issues such as social determinant of health can also make a big difference in these efforts. Enabling digital technologies that “make the right thing to do the easy thing to do” will also reduce the likelihood of clinician “burnout.”


  1. Payment for outcomes

Population health strategies often focus on closing gaps in care and/or on interventions to reduce the risk of avoidable hospitalizations and other “overuse” patterns. Henceforth, health systems must also show a significant impact on health status measures in the community, such as improved health status, reductions in the risk of serious illnesses, and top performance for patient-reported outcomes, such as functional status and quality of life. Analytic systems that rely on retrospective “look-back” algorithms often imprecisely quantify these future risks for many individual patients. Instead, deploying more state-of-the-art data, and science driven algorithms and expertise with a focus on causation will be essential for future population health success.


  1. Prevention of disease before it occurs

Administrator Verma’s fourth “P” is often identified as the most important in truly achieving the Quadruple Aim. But “Prevention” has many dimensions, making this the most complex area to impact. Primary and secondary prevention guidelines constitute a large and growing body of scientific evidence in terms of what works and what doesn’t work. One only has to review the current list of recommendations put forth by the United States Preventive Services Task Force (USPSTF) and the Centers for Disease Control (CDC) to understand the magnitude of this last challenge. However, we must not forget the need to also promote tertiary and quaternary prevention (the latter being health activities that mitigate or avoid the consequences of unnecessary or excessive intervention of the health system).

Today’s value-based programs must truly reward providers with incentive payments for the quality care they provide. Incorporating a population health management (PHM) program that enables and facilitates real solutions for CMS’s “4 P’s” can push organizations across the board closer to addressing the right issues—and improve the health status in the communities they serve.

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