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Episode-based performance measurement and payment: making it a reality.

Peter S Hussey1, Melony E Sorbero, Ateev Mehrotra

  • 1RAND, Arlington, Virginia, USA. peter_hussey@rand.org

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Episodes of care offer a new payment model, but require more research. Analyzing Medicare data reveals key issues in defining episodes and provider accountability for improved implementation.

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Area of Science:

  • Health Services Research
  • Healthcare Economics
  • Medical Payment Models

Background:

  • Episode-based payment and performance measurement concepts are under development.
  • Limited empirical evidence exists to guide the practical design of these models.
  • Existing healthcare payment structures require refinement for value-based care.

Purpose of the Study:

  • To identify critical considerations for designing episode-based payment and performance measurement systems.
  • To analyze Medicare data to inform the definition of care episodes and provider accountability.
  • To propose applied studies and demonstrations to accelerate the adoption of episode-based approaches.

Main Methods:

  • Analysis of large-scale Medicare administrative and claims data.
  • Identification of key variables and criteria for defining episodes of care.
  • Evaluation of methodologies for assigning provider accountability within defined episodes.

Main Results:

  • Key challenges in defining episode boundaries and selecting appropriate outcome measures were identified.
  • Methods for attributing episodes to specific providers, considering multi-provider involvement, were explored.
  • Data-driven insights highlight the complexity of implementing standardized episode definitions.

Conclusions:

  • Further applied research and demonstrations are crucial for refining episode-based payment models.
  • Clearer definitions and accountability frameworks are needed for successful implementation.
  • Evidence-based approaches are essential to transition from conceptual to practical application in healthcare payment.