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  • HHS Announces Timelines for Transitions Away From Fee-for-Service Models

    The US Department of Health and Human Services (HHS) has released its first definitive set of timelines for a transition away from fee-for-service payment models in Medicare, and toward delivery and payment systems that APTA is helping its members understand and prepare for.

    This week HHS officially announced that it will establish milestones in its efforts to create payment systems based on outcomes rather than services provided: by 2016, it plans to tie 30% of Medicare payments to alternative payment models, and increase that level to 50% by the end of 2018. At the same time, the department plans to link 85% of remaining fee-for-service payments to some outcome measures by the end of 2016 and bump that to 90% 2 years later.

    While the HHS move toward outcome-based payment models has been well-known since the establishment of the Patient Protection and Affordable Care Act (ACA), this is the first time HHS has attached definitive timelines to what it believes are measurable goals.

    "Although we have much to celebrate regarding increased access and quality, and reduced cost growth, much of the hard work of improving our health care system lies ahead of us," HHS Secretary Sylvia Burwell wrote in an article announcing the timelines published in the New England Journal of Medicine.

    The alternative payment arrangements targeted in the shift will include accountable care organizations (ACOs), bundled payment arrangements, and patient-centered medical homes. Currently, about 20% of Medicare payments are made through alternative arrangements such as these.

    The concepts being endorsed by HHS through the new timelines won't likely be news to APTA members, who have been learning about the new models—and investigating the ways physical therapists (PTs) and physical therapist assistants (PTAs) could work in these systems—since before the implementation of the ACA.

    "Physical therapy stands to play a very important role in these new payment models," said Gayle Lee, JD, APTA senior director of health care finance and quality. "PTs are in a position to reduce readmissions, increase independence, and improve quality of life, all of which are central goals of the alternative systems. We are confident that PTs and PTAs are integral to bringing about an important transformation in health care delivery."

    APTA has been helping its members position themselves for the future through its online resources on collaborative care and innovations in practice (including the latest information on the association's "Innovation 2.0" initiative). Additionally, members can access up-to-date information on the Physician Quality Reporting System (PQRS) generally, as well as specific resources on the value-based modifier system.

    And as HHS prepares for a health care future with increased attention to outcomes, APTA is making that future a reality for physical therapy through the establishment of the Physical Therapy Outcomes Registry, a far-reaching project that seeks to build a database that will demonstrate how physical therapist services change lives.

    The APTA initiatives resonate with several of the HHS plans. In her NEJM article, Burwell identified some of the targets for more immediate changes, including the testing of new payment models for specialty care, beginning with oncology, and "payments to providers for care coordination for patients with chronic conditions." These efforts will join current HHS programs to reduce hospital readmissions by encouraging hospitals to "improve transitional care and coordinate more effectively with ambulatory care providers," she wrote.

    "Whether you are a patient, a provider, a business, a health plan, or a taxpayer, it is in our common interest to build a health care system that delivers better care, spends health care dollars more wisely and results in healthier people," Burwell said in an HHS press release. "We believe these goals can drive transformative change, help us manage and track progress, and create accountability for measurable improvement."

    Other news sources and perspectives on the HHS announcement:

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