Catalyst for Payment Reform, Inc.

The prevailing fee-for-service payment system can result in unnecessarily high levels of care, tests, and treatments.

There is a growing consensus that alternative payment methods can reduce health care costs and improve outcomes. While providers and payers across New York State are experimenting with new arrangements to derive more value from care, it is still unclear which methods can most effectively replace fee-for-service models. Additionally, there is no systematic information available about the current payment landscape to set goals and measure progress. In 2013, Catalyst for Payment Reform (CPR) created both a national and a California state scorecard on payment reform. It found that nearly 90% of commercial payments nationwide are still fee-for-service and/or lack quality incentives. To provide insight to payment reform in New York State, NYHealth awarded CPR a grant to support the first-ever New York State scorecard on payment reform.

Under this grant, CPR identified health care expenditures in New York State that are paid using fee-for-service and alternative payment methods (e.g., bundled payments, shared savings, and global payments) to identify potential savings. The scorecard also highlighted differences between fee-for-service spending in the Medicaid and commercial markets. By incorporating Medicaid spending, New York’s scorecard went further than those CPR previously produced to rate payment reform performance. Because this project required substantial data collection to develop comprehensive and accurate information, health plans submitted data through an existing collection tool called eValue8, which was developed by the National Business Coalition on Health. The New York State scorecard built upon eValue8 by adding additional metrics to more precisely benchmark expenditures. CPR and the National Business Coalition on Health leveraged their team of experts and several external partners to conduct data validation, analysis, aggregation, and reporting. CPR disseminated the New York State scorecard results to payers, providers, State policymakers, businesses, the media, and other stakeholders and mad the scorecard materials and methodologies publicly available online.

In August 2014, NYHealth awarded CPR an additional grant of $47,500 to support its work in expanding the scorecard in the wake of new State regulations that required all health plans to participate and submit data directly to the project portal. NYHealth funds paid the costs associated with the health plans’ participation, as they cannot be charged for their participation data under the regulations. The greater number of participating plans also led to a small increase in data processing, cleaning, and analysis fees, which was addressed through this secondary funding.

Read the New York Scorecard on Commercial Payment Reform.

Read the New York Scorecard on Medicaid Payment Reform.