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On January 26, 2015, the US Department of Health and Human Services (HHS) announced measurable goals and a timeline to move the Medicare program and the American health care system at large toward a "better, smarter, healthier" system in which payment to providers would be based on the quality, rather than the quantity, of care provided to patients.1  

A report published by the Health Care Payment Learning & Action Network (LAN) in October 20182 showed that, in 2017, 34% of US health care payments across all payer types—representing nearly 226.3 million people, or 77% of the covered US population—were tied to alternative payment models (APMs) based on value. Although that number constituted a "steady" increase from 23% 2 years earlier, it seemed clear that HHS's goal of 50% APMs by the end of 2018 would not be met.

Why is it that even though 90% of payers expect APM adoption to accelerate, according to the LAN report, progress to date has lagged? The report cited the following as the top 3 challenges to APM adoption: willingness to take on financial risk, ability to operationalize these models, and interest or readiness of providers.

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  1. US Department of Health and Human Services. "Better, Smarter, Healthier: In Historic Announcement, HHS Sets Clear Goals and Timeline for Shifting Medicare Reimbursements from Volume to Value." (Press release.) https://wayback.archive-it.org/3926/20170127185400/https://www.hhs.gov/about/news/2015/01/26/better-smarter-healthier-in-historic-announcement-hhs-sets-clear-goals-and-timeline-for-shifting-medicare-reimbursements-from-volume-to-value.html. Accessed July 23, 2019.
  2. Health Care Payment Learning & Action Network. Measuring Progress: Adoption of Alternative Payment Models in Commercial, Medicaid, Medicare Advantage, and Fee-for-Service Medicare Programs. https://hcp-lan.org/2018-apm-measurement/. Accessed July 23, 2019.
  3. American Physical Therapy Association. Health Value-Based Care Survey. http://www.apta.org/PaymentReform/StatusQuiz/. Accessed July 23, 2019.
  4. Warren M, Smith HL. Exploration of functional limitation codes for outpatient physical therapy in the Medicare population: a retrospective cohort study. Phys Ther. 2018;98(12):980-989.
  5. Center for Effectiveness Research in Orthopaedics. Evaluation of Legacy Patient-Reported Outcome Measures As Performance Measures in Rehabilitation. https://www.aptqi.com/wp-content/uploads/2019/07/Evaluation-of-Legacy-Patient-Reported-Outcome-Measures-as-Performance-Me....pdf. Accessed July 23, 2019.

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