Value-based Payments

Background and Existing CAQH CORE Efforts 

Value-based payment models (VBP) are a transformative force in healthcare, seeking to shift a system that incentivizes volume to one that rewards high quality care. In 2020, approximately 41% of all healthcare payments flowed through a VBP model, touching approximately 80% of the covered U.S. population (HCP LAN). Though adoption has exhibited steady growth and is expected to continue its ascent over the next decade, barriers to implementation remain persistent.

CAQH CORE has been an active participant in reducing inefficiencies and barriers to entry in VBP. The 2018 report All Together Now: Applying the Lessons of Fee-for-Service to Streamline Adoption of Value-Based Payments identifies 5 operational areas that, if addressed, could minimize variation and aid implementation of VBP models (see figure 1). As a result of this research, CAQH CORE Participants developed and approved a set of operating rules to standardize data exchange to support patient attribution, a key component of many value-based care arrangements. These operating rules outline procedures for payers to send attributed patient rosters for a given a VBP contract and to indicate single patient attribution to a VBP contract using the eligibility transaction. 

Figure 1: Value-based Payment Opportunity Areas

Current State of VBP and Future Directions from CAQH CORE

The healthcare industry has reached an inflection point with VBP. Results of demonstrations to-date published by the Centers for Medicare and Medicaid Innovation (CMMI) have shown only modest success at limiting healthcare spend, leading to a re-evaluation of the goals and applications of VBP beyond cost reduction. Greater emphasis is now being placed on using VBP to combat health inequities by directly addressing social risk factors in program design. Though reducing spend will remain a principal measure of success for VBP, going forward, models will also be evaluated based on how they impact health inequities. In the future, a successful pilot may be one that impacts expenditures, health inequity, or both.

CAQH CORE is encouraged by the expanding scope of VBP. Success, however, is still predicated on traversing the persistent barriers that threaten adoption. These barriers include known issues, such as limited data availability and standardization, as well as emerging issues, like increasing program complexity that complicates program management.  CAQH CORE is seeking to better understand the current evolution of VBP and the remaining barriers to adoption by undertaking a comprehensive environmental scan in 2022. This is a first step in maintaining existing attribution operating rules and evaluating the industry need for additional operating rules or recommendations that support the uptake and growth of VBP models.

CAQH Program