Definitions of Payment Model Terms

The following contains definitions of terms used in the Compendium.

Terms Definition
Attribution Refers to a statistical or administrative methodology that attributes a patient population to a provider for the purposes of calculating health care costs/savings or quality of care scores for that population. "Attributed" patients can include those who choose to enroll in, or do not opt-out-of, an ACO or PCMH.  For the purposes of the Scorecard, Attribution is for Commercial (self-funded and fully-insured) lives only.  It does not include Medicare Advantage or Medicaid beneficiaries.
Bonus payments based on measures of quality and/or efficiency Payments made that reward providers for performance in quality and/or efficiency relative to predetermined benchmarks, such as meeting pre-established performance targets, demonstrating improved performance, or performing better than peers.  This does NOT include payments made under shared savings arrangements that give providers an increased share of the savings based on performance.
Bundled payment Also known as "Episode-based payment" means a single payment to providers or healthcare facilities (or jointly to both) for all services to treat a given condition, or, to provide a given treatment. Providers assume financial risk for the cost of services for a particular treatment or condition as well as costs associated with preventable complications.
Condition-specific capitation A fixed dollar payment to providers for the care that patients may receive for a specific condition (or set of conditions) in a given time period, such as a month or year. Non-specified conditions remain reimbursed under fee-for-service or other payment method.
Dollars paid Claims and incentives that were paid to providers (including individual physicians, IPAs, medical groups, and/or inpatient and outpatient facilities) for services delivered to health plan participants in the past year, during the 12 month reporting period, regardless of the time period when the claim or incentive payment was/is due. (i.e., regardless of when the claim was received or when the service was rendered or period of when performance was measured). For example, incentive payments that were paid in calendar year 2012 for performance in calendar year 2011 should be reported.  Claims for 2012 services that are in adjudication and not yet paid during the reporting period, should not be included in this response
Episode-based payment Also known as “Bundled” Payment, is reimbursement to the provider on the basis of expected costs for clinically defined episodes that may involve several practitioner types, several settings of care and several services or procedures over time.  An example is payment to obstetricians for the ongoing management of pregnancy, delivery and postpartum care.
FFS-based payment Payment model where providers receive a negotiated or payer-specified payment rate for every unit of service they deliver without regard to quality, outcomes or efficiency.
Full capitation with quality (sometimes also referred to as global payment) A fixed dollar payment to providers for the care that patients may receive in a given time period, such as a month or year, with payment adjustments based on measured performance and patient risk. Includes quality of care components with pay-for-performance.   Full capitation plus P4P is considered full capitation with quality.
Full capitation without quality A fixed dollar payment to providers for the care that patients may receive in a given time period, such as a month or year. Payments may or may not be adjusted for patient risk and there are no payment adjustments based on measured performance.
Hospital-physician gainsharing Arrangement in which hospitals and physicians share the cost savings achieved through collaborative efforts resulting in improved quality and/or efficiency.
Maternity services Includes any or all of the following services: prenatal care (such as office visits and screening tests), labor and delivery services (including hospitalization), care resulting from complications related to a pregnancy, and postpartum/postnatal care.
Member support tools Tools (e.g. web-based) that provide transparency including but not limited to quality metrics, quality information about physicians or hospitals, benefit design information, out-of-pocket costs associated with expected treatment or services, average price of service, and account balance information (e.g. deductibles).
Non-FFS-based payment Payment model where providers receive payment not based on the FFS payment system or not tied to a FFS fee schedule.
Non-visit function Includes but is not limited to payment for outreach and care coordination/management; after-hour availability; patient communication enhancements, health IT infrastructure and use. May come in the form of care/case management fees, medical home payments, infrastructure payments, meaningful use payments, and/or per-episode fees for specialists.
Partial capitation A fixed dollar payment to providers for specific services (e.g. payments for carve outs for high-cost items such as specific drugs or medical devices, like prosthetics) that patients may receive in a given time period, such as a month or year. Non-specified services remain reimbursed under fee-for-service.
Past year (in definition for dollars paid) Means calendar year 2012 or the most current 12 month period for which Plan can report payment information.  This is the reporting period for which the Plan should report all of its data.  See also definition of "Reporting Period."
Pay-for-performance Provides incentives (typically financial) to providers to achieve improved performance by increasing quality of care and/or reducing costs. Incentives are typically paid on top of fee-for-service payment models.
Payment reform  Refers to a range of health care payment models that use payment to promote or leverage greater value for patients, purchasers, payers, and providers.
Plan members Health plan's enrollees or plan participant.
Primary Care Physicians A primary care physician is a generalist physician who provides care to patients at the point of first contact and takes continuing responsibility for providing the patient's care. Such a physician must have a primary specialty designation of family  medicine, internal medicine, geriatric medicine, or pediatric medicine.  For the purposes of this data collection, PCPs are not specialists.  See definition of "specialists."
Program Sponsor Entity that is the primary owner or administrator of the payment reform program.
Providers Physicians, non-physician clinicians (e.g. nurse practitioner), IPAs, medical groups, and inpatient or outpatient facilities, including ancillary providers.
Quality/Quality Components A payment reform program that incentivizes, requires, or rewards some component of the provision of safe, timely, patient centered, efficient, and/or equitable health care.
Reference pricing Approach to pricing that establishes a health-plan determined covered amount (price) for a drug class, procedure, service or bundle of services, and generally requires that health plan participants pay any allowed charges beyond this amount.
Reporting Period Reporting period refers to the time period for which the Plan should report all of its data.  Unless otherwise specified, reporting period refers to calendar year (CY)  2012.  If sufficient information is not available to complete this RFI based on the calendar year, the Plan may elect to report for the time period October 1, 2011 to September 30, 2012.  If this election is made, ALL answers to this question  should reflect the adjusted reporting period unless otherwise noted e.g., in the payment reform questions. If reporting period is not CY 2012, and  October 1, 2011 to September 30, 2012 was used, Plan should interpret “prior calendar year” in the text and tables to be October 1, 2010 to September 30, 2011.
Shared savings Provides an incentive for providers or provider entities to reduce unnecessary health care spending for a defined population of patients, or for an episode of care, by offering providers a percentage of any realized net savings (e.g. upside risk only). "Savings" can be measured as the difference between expected and actual cost in a given measurement year, for example. Shared-savings programs can be based on a FFS payment system.  Shared Savings can be applied to some or all of the services that are expected to be used by a patient population and may vary based on provider performance.
Shared-risk Refers to arrangements in which providers accept some financial liability for not meeting specified financial or quality targets; examples include loss of bonus; baseline revenue loss; or loss for costs exceeding global or capitation payments; withholds that are retained and adjustments to fee schedules. For the purposes of this data collection, shared-risk programs that include shared-savings should only be included in the shared-risk category (e.g. includes both upside and downside risk).  Shared-risk programs can be based on a FFS payment system.
Specialists Specialist physicians have a recognized expertise in a specific area of medicine.  They have undergone formal residency AND/OR FELLOWSHIP training programs and have passed the specialty board examination in that field.  Examples include oncologists, ENTs, cardiologists, OB-GYNs etc.  For the purposes of this data collection, specialists are not PCPs. See definition of "primary care physicians.”
Unnecessary elective medical intervention during labor and delivery in the past year. Unnecessary intervention includes non-medically indicated (elective) labor induction and cesarean deliveries.   Contracts that provide incentives for adhering to clinical guidelines related to unnecessary elective medical intervention during labor and delivery may include provisions that require hospitals to implement a “hard stop” policy, include a “do not pay” directive, or require prior authorization for elective labor induction and cesarean deliveries prior to 39 weeks.
Value-Pricing Concept in which buyers hold providers of health care accountable for both cost and quality of care by paying providers differentially based on value. "Value" can have a variety of definitions under value-based purchasing, and typically brings together metrics on the quality of health care (such as patient outcomes and health status) with metrics on the dollar outlays going towards health.