Most commercial payments flowing through alternative payment methods, report says

In the commercial sector, most physician and hospital payments are being made through alternative payment methods — but nearly all of those methods are built on fee-for-service functions, according to a report from the nonprofit value-based care organization Catalyst for Payment Reform.

The report, which examined commercial payment data from 2012-17, found 53 percent of commercial payments flowed through alternative payment methods in 2017, up from 10.9 percent in 2012. While pay-for-performance models saw early investment at the beginning of the five-year period, by 2017, shared savings payment agreements were the most common type of alternative payment method. Bundled payments were the least common type, representing only 2 percent of commercial dollars paid in 2017.

Still, 90 percent of value-oriented payments in 2017 came from models built on a fee-for-service foundation. Only 6 percent of provider dollars came from payment models that included downside risk in 2017, the report found.

Click here to read the full report.

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