Promoting Value Rather Than Volume: ACHP Health Plans Establish Physician Payment Models

September 17, 2013

CONTACT: Rachel Schwartz
202-251-8881 (cell)
202-785-2247 (office)

WASHINGTON, D.C. — For Alliance of Community Health Plans (ACHP) member organizations, changing the way we pay physicians means a greater focus on patients, on their health and on lowering costs. Community-based health plans are providing a practical guide to payment reform, charted in a report released today by the Alliance of Community Health Plans (ACHP).

“In many communities around the country, ACHP member organizations have changed the way they pay physicians to ensure that payment is focused on efficient and effective care, focusing on the needs of patients.  They have piloted strategies that work,” said ACHP President and CEO Patricia Smith. “We believe that this report offers real solutions that can help inform the discussions happening right now on Capitol Hill on how to change the way Medicare pays for physician services.”

Key elements of proposals for physician payment reform include changing the current fee-for-service payment to incorporate criteria for quality, value, primary care and care coordination.  Medicare Advantage, which now serves over 28 percent of Medicare beneficiaries, already includes these criteria.  The ACHP brief outlines methods used in plans around the country that could be incorporated into a reformed Medicare fee-for-service payment system.

In his testimony before the U.S. House Energy & Commerce Committee on physician payment reform in June 2013, Tom Foels, M.D., chief medical officer of Independent Health in Buffalo, New York, described Independent’s success implementing alternative payment systems and said, “We believe there are valuable components of our quality, efficiency and effectiveness programs that are potentially scalable and transferrable to other communities beyond our own.”

Patrick T. Courneya, M.D., (health plan) medical director of HealthPartners in Minneapolis, Minnesota, declared in his May 2013 testimony before the U.S. House Ways and Means Committee that value-based payment systems, “if built thoughtfully and properly – can be not only workable but desirable for physicians and an accelerant of improved health, better experiences and improved affordability for patients.”

“Moving Beyond Fee-for-Service: A Path to Payment Reform from Community Health Plans” profiles the specific approaches seven ACHP member plans undertook to build the capacity, trust and incentives for reform. The report is meant to serve as an illustrative guide for policy makers and others looking to implement physician payment reform.

The report highlights payment reforms currently in place at seven ACHP member organizations:

  • Capital District Physicians’ Health Plan (Albany, New York)
  • Geisinger Health Plan (Danville, Pennsylvania)
  • HealthPartners (Minneapolis, Minnesota)
  • Independent Health (Buffalo, New York)
  • Priority Health (Grand Rapids, Michigan)
  • Tufts Health Plan (Watertown, Massachusetts)
  • UPMC Health Plan (Pittsburgh, Pennsylvania)

Visit for more information, including the complete report, and details on ACHP’s member plans.

About ACHP

The Alliance of Community Health Plans (ACHP) is a national leadership organization bringing together innovative health plans and provider groups that are among America’s best at delivering affordable, high-quality coverage and care. The community-based and regional health plans and provider organizations from across the country that make up ACHP’s membership provide coverage and care for approximately 16 million Americans. These 22 organizations focus on improving the health of the communities they serve and are on the leading edge of innovations in affordability and the quality of care, including patient care coordination, patient-centered medical homes, accountable health care delivery and use of information technology. For more information, visit