Close to 45% of payments flow through value-based models, with 28.7% in downside risk, according to AHIP survey.
Value-based care continues to account for a substantial share of U.S. healthcare payments, underscoring sustained payer investment in payment models that link reimbursement to quality and cost outcomes.
The findings come from a survey released by AHIP in collaboration with the Centers for Medicare and Medicaid Services.
Danielle Lloyd, M.P.H., AHIP’s senior vice president of private market innovations and quality initiatives for Clinical Affairs, told Healthcare Finance News there are encouraging signs about future growth because of a growing pipeline of participants that extends beyond primary care physicians to organizations, such as nursing homes and Federally Qualified Health Clinics.
“Also, note overall performance within these models remains successful at driving improvements for patients and that their commitment to these models is unwavering,” she said.
Lloyd explained health plans and providers are making strides toward greater data interoperability that will continue.
She noted that being able to more seamlessly share population-level data files from plans to providers and quality measurement information in return will facilitate better care and ease burden on providers.
“Moreover, as we embark on applying AI, we are hopeful that it will dramatically reduce administrative tasks, improve data quality and accessibility, ensure the provision of evidenced-based care and other benefits that will improve the patient experience, health outcomes and care efficiency,” Lloyd said.
A Centers for Medicare and Medicaid Services Interoperability and Prior Authorization Final Rule, released in January 2024, is reshaping how healthcare organizations, especially payers, handle prior authorizations and data exchange.
The AHIP report analyzed commercial, Medicaid, Medicare Advantage and original Medicare payments made to providers in 2024, using the Health Care Payment Learning and Action Network framework. HCPLAN consists of a group of public and private healthcare leaders that support the adoption of alternative payment models (APMs).
The survey, which represents more than 271 million covered lives, found nearly 45% of all healthcare payments across lines of business in 2024 were tied to alternative payment models that hold providers accountable for both quality and cost of care. This is a slight decline from 45.2% in 2023.
APMs aim to improve healthcare quality and lower costs by realigning payment incentives to encourage changes in care delivery expected to result in better quality, more affordable care.
Payments tied to models that include downside financial risk accounted for 28.7% of total payments, up from 28.5% the prior year.
Both original Medicare and Medicare Advantage recorded increases of more than 2 percentage points in the share of payments flowing through downside risk arrangements.
Looking ahead, health plans signaled continued expansion of value-based payment activity. Seventy percent of respondents said they expect alternative payment model participation to increase over the next 24 months, citing provider readiness, health plan engagement and operational capabilities as key drivers.
In addition, the majority (55%) of respondents said they believe the category that will grow the most in the future is 3B – shared-risk/procedure-based episode payments.