A McKinsey & Co. white paper details seven tips for designing an alternative payment model that works.
Here are the key takeaways:
1. McKinsey & Co. advises ensuring that not only a large enough group of patients is attributed to the APM, but also a significantly large portion of a provider's book of business. This helps reduce variation that can leave savings up to chance.
2. Physician-led APMs tend to create more savings since the hospital-led ones often find these savings at odds with revenue creation. Because of this, hospitals should start by focusing on finding efficiencies in the post-acute setting or in their areas of expertise where they can increase market share.
3. McKinsey recommends providers take on financial risk and not exclude high-risk patient populations, as the care delivered to those populations has the most potential for improving efficiency.
4. Quality metrics should include patient-reported outcomes and the rate of potentially avoidable complications.
5. The key to striking the balance between seemingly incompatible payer and provider goals is focusing on risk-adjustment, benchmarking and patient attribution.
6. Financial incentives should be linked to professional motivation and attainable goals.
7. It is essential to think about APMS from a consumer point of view. Consumer incentives should align with the goals of the APM.
Read the full paper here.
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