A Path Forward for Alternative Payment. Build a Portfolio Not a Garden.

Although there is a common thread across all APMs (extending payment and accountability across organizations and time), the details vary widely across models. Some, such as the ACO models, are broad, holding participants responsible for total spending and quality. Others, such as episode-based payment (EBP) models, are narrower, holding clinicians and health care systems responsible for the total spending and quality of an episode of care. Within each of these model types, there are many variations of key program parameters, including how spending targets are set, how much risk is imposed, how beneficiaries are assigned to organizations, and how quality is rewarded. Given the lack of consensus on the best APM design, the need to produce evidence on different approaches, and the desire to encourage participation, the health system would be better served by adopting a portfolio paradigm in which a limited number of models are implemented that work together to achieve overarching goals.