Alternative Payment Models

Within efforts to address health care spending, novel approaches to paying for care are being adopted, but there is much to be learned about how and when they work, and the role of biopharmaceuticals in their success.  

What are alternative payment models?

In response to decades of rising health care expenditures, U.S. health care payers, providers and policymakers have adopted numerous policy interventions to shift the U.S. health care system from volume-based, fee-for-service reimbursement to value-based payment and care delivery. Value-based contracts, accountable care organizations (ACOs), bundled payments and other innovative payment and delivery models are gaining traction all over the country. The National Pharmaceutical Council's research takes a closer look at these alternative payment models and identifies the critical role biopharmaceuticals play in this changing health care environment. 

Learn about value-based payment models for biopharmaceuticals:

Value Based Contracts

Value-Based Contracts

Biopharmaceutical manufacturers, payers and patients can benefit from value-based contracts that link coverage and reimbursement levels to a treatment’s effectiveness.


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Regulatory Barriers and Challenges

Delivering on the promise of value-based contracts requires us to address regulatory barriers imposed by the Medicaid Best Price program and the federal Anti-Kickback Statute. 

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Paying for Cures

Curative treatments and therapies have the potential to transform care and significantly improve a patient’s quality of life. However, by their very nature, they can accelerate costs and impose a significant financial burden on private and public payers. As a result, alternative payment solutions are needed to facilitate access and appropriate payment for curative therapies.

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Value-based Payment Models for Providers: 

Accountable Care Organization and Care Coordination

Accountable Care Organizations (ACOs)

Accountable Care Organizations (ACOs) work to coordinate care for patients and have the potential to improve care delivery and reduce costs, particularly when patient access to necessary treatments and medications is optimized. 

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Bundled Payments

Bundled payments, which link payments for the multiple services beneficiaries receive during an episode of care, are intended to align reimbursement with the health care triple aim of improving the quality of care, improving population health, and reducing total costs of care.

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NQF Quality Measures Booklets

Health Care Quality Measures

Quality measures play an essential role in all value-based payment models and can help payers to reward better care, encourage providers to improve care delivery, and guide patients to make more informed decisions when seeking care. However, because quality measurement influences priorities and care delivery, it is critically important to design and implement quality measurement thoughtfully. 

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