67% of commercial insurer payments in Virginia tied to value, analysis finds

Many commercial and Medicaid contracts in Virginia now include value-oriented incentives, according to an analysis from the Catalyst for Payment Reform, the Virginia Center for Health Innovation and the Virginia Association of Health Plans. 

The analysis — which is based on examination of data from commercial and Medicaid managed care plans insuring 4.6 million Virginians — found 67 percent of healthcare payments to Virginia physicians and hospitals by commercial insurers in 2016 were tied to value. That same year, 37 percent of payments from Medicaid managed care organizations were tied to value.

The analysis "provide[s] useful baseline information for the Commonwealth and shows that Virginia is on its way toward a healthcare marketplace that financially rewards value, and not just volume of services provided," said Beth Bortz, president and CEO of the Virginia Center for Health Innovation.

Four other findings:

1. Eighty percent of value-oriented commercial insurer payments were in hospital contracts. Forty-seven percent went to primary care providers, and 45 percent to specialists.

2. Forty-one percent of value-oriented Medicaid managed care payments were in primary care. Twelve percent went to hospitals, and 8 percent to specialists.

3. The most common value-oriented commercial insurer payment was shared savings (33.7 percent), which incentivizes providers to decrease expenses for a specific patient population.  

4. The most common value-oriented Medicaid managed care payment was performance-based pay (20 percent), which rewards providers if they meet quality and efficiency targets.

Access the full findings here


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