McKinsey: This is what makes APMs successful  

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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