Jennifer Mendoza
Research expert covering health, pharma and medtech
Affordable Care Act's payment reforms- Statistics & Facts
The Affordable Care Act, signed into law in 2010, is a major health care reform in the United States. Aside from expanding health care access and coverage, the ACA also contains several provisions to reform the payment and delivery system of the United States. These provisions target the inefficiency and high cost of a predominantly fee-for-service system, and the inconsistent level of care patients receive from different providers or regions. The problem is that for the high amount the U.S. spends on health care – roughly 19 percent of GDP – much higher than comparable high-income countries, Americans are not healthier. In fact, they perform worse on many health outcomes such as maternal mortality and treatable deaths. Americans do not actually use more health services, rather the high health spending in the U.S. is attributed to a multitude of other factors, such as higher health costs, higher physician charges, higher drug prices, and higher health administrative costs. Another area of health cost comes from wasteful health spending, particularly uncoordinated care or overtreatment. One of the ways to address this – to provide better care at lower cost – is to hold providers accountable for the quality and costs of care. Rather than rewarding the delivery of more services regardless of benefit to the patient, such is the trend under fee-for-service payments, the quality of care should instead be rewarded. To this end, the Center for Medicare & Medicaid (CMS) Innovation Center was created under the ACA to introduce and test innovative health care payment models.
