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Viewpoint
July 28, 2015

Outlook for Alternative Payment Models in Fee-for-Service Medicare

Author Affiliations
  • 1Duke Clinical Research Institute and Department of Medicine, Duke University School of Medicine, Durham, North Carolina
  • 2Duke University School of Law, Durham, North Carolina
  • 3Department of Emergency Medicine, University of North Carolina School of Medicine, Chapel Hill
JAMA. 2015;314(4):341-342. doi:10.1001/jama.2015.8047

The warnings are now familiar: health care spending for retirees in the United States is unsustainable, the Medicare program is going bankrupt, and the program is in desperate need of reform. The financial burden the Medicare program imposes on the federal budget and the national economy is substantial. Medicare’s total obligations were 3.5% of the gross domestic product in 2013 and are projected to increase to 5.4% by 2035, primarily due to expected growth in enrollment from 52.3 million to 86.8 million beneficiaries, and will substantially strain the economy and the federal budget.1 Alternative payment models (APMs), which are built on the existing fee-for-service foundation but include new payments linked to the effective management of a population or episode of care, have been proposed as potential solutions to restrain costs. In this Viewpoint, we describe the status of the APMs being tested in the Medicare population and the outlook for these models to reduce program expenditures.

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