Alternative Payment Models


Change is hard, it takes resilience, ingenuity, innovation and persistence…

These are all words associated with healthcare in general and primary care specifically, and no more relevant during the pandemic of 2020-2021. This is a great time to reflect on the strengths of primary care that made it the center of payment reform and care delivery change in the US. The strengths of resilience, ingenuity, innovation, persistence and ability to change coupled with the commitment to ensure high quality, high value person-centered care make primary care the most powerful and yet most undervalued component of healthcare in our current care delivery system. 

The implementation of APMs as part of a larger Quality Payment Program (QPP) is advancing payment toward value. Changing how we pay for healthcare and establishing an optimal care delivery structure is at the foundation of all APMs. Harnessing resilience, ingenuity, innovation and persistence, when the only constant is change is foundational to success in primary care in 2021. 


APMs have evolved over the years in response to the realization that the fee for service (FFS) methods of payment created many problems for patients and caregivers. FFS is seen as pay or reward for volume, with little requirement of value and is considered a key driver in the poor performance of the U.S. healthcare system as compared to 10 other developed countries. The U.S. has the costliest healthcare system and performs the worst on life expectancy, suicide rates, presence of chronic conditions and hospitalizations for preventable causes. i APMs are defined by CMS as “a payment approach that gives added incentive payments to provide high-quality and cost-efficient care. APMs can apply to a specific clinical condition, a care episode or a population” and are seen as a vehicle to transition from FFS to promotion of value in care delivery. ii Primary care is necessary to make this transition to a person-focused, high value healthcare system. APM success is also a great opportunity to validate the role (and value) of primary care in the healthcare system. 

As we review APM evolution, it is a great time to reflect on the strength of primary care’s resilience, ingenuity, innovation and persistence, with a focus on high quality, high value care for patient and families. It is also important to focus on the common characteristics, that when done well, lead to success in any variation of APM payment. The Primary Care Collaborative characterizes these primary care attributes defined by Shared Principles of Primary Care iii as follows:

As an advocate for an empaneled patient population, primary care teams continue to have great opportunity to understand and implement these shared principles in a way that meets the needs of patients and families. One example is taking a population-based approach to understanding the concept of continuous care and trusted relationship with their primary care clinical team. This relationship, when done well, is known to reduce unnecessary utilization, improve activation and improve quality of care. In addition, comprehensive and equitable care reflects an understanding of all that influences patients’ health decisions (especially the complex patient) by assessing social determinants (or influencers) of health (SDoH / SIoH) in a manner that informs risk and support needs. Again, emphasizing the opportunity to validate (with data) what primary care does to ensure high quality, high value care that improves the of quality of life for patients. 

Emphasis on the common characteristics that drive APM success for primary care is important to counter the challenges of dealing with a wide variety in APMs, each with differing measures, benchmarks, care delivery, utilization and reporting expectations. An additional challenge is the need to have a majority of the practice population involved to support and sustain care delivery change. Reaching this ‘majority of population’ impact takes participation in many models for most healthcare markets. While there are several tests of multi-payer APM initiatives, there is still much opportunity to integrate and simplify value-based payment. In the current environment, it is particularly important to focus on common care delivery characteristics that contribute to success across APMs and can be adapted based on population (and payment) priorities. Primary care participation and ‘voice’ is foundational to inform APM models across populations that lead to sustainable change.   

In the current environment, it is particularly important to focus on common care delivery characteristics that contribute to success across APMs and can be adapted based on population (and payment) priorities. Primary care participation and ‘voice’ is foundational to inform APM models across populations that lead to sustainable change.   

The Medicare transition to performance-based payment continues with a focus on two key QPP participation tracks. These two QPP tracks are the Merit Based Incentive Payment System (MIPS) or the Alternative Payment Model (APM) track. To provide a brief summary of APMs in 2021 is not a simple task, and review of current APM work is a reminder of the rapid change occurring in payment.

CMS APMs iv v with an emphasis on primary care include:

Other Payer APMs vi are growing, including:

Note: Other Payer APM’s must meet specific criteria that include use of CEHRT, payment based on quality and presence of a financial risk component to the payment model.

Each of these APMs is an opportunity to expand our collective learning on how payment drives and sustains care delivery changes in primary care and to validate necessary components to ensure high value care. Each new model, track or option is developed based on learnings from previous APM models. All newer APM efforts are required to include an increasing focus on assuming risk. Shared financial risk is seen as a key component of all value-based models for the future. For additional detail on the APM details, please review information on the CMS APM site: or the Health Care Payment Learning and Action Network (HCP-LAN) site   

While the complexity of payment models and the rate of change in how payment is calculated are only increasing, it is important to focus on the commonalities that can provide stability for primary care. Those components of advance primary care that are constant across all payment model success, with necessary adaptation based on the population served, should be the focus of primary care. Learning to expand access to streamlined data for effective population-based initiatives is key to supporting primary care on their quest to ensure person-centered, high quality, high value care. APMs provide this opportunity but we know it is a work in progress. Primary care participation and success in this work ensures that there will be a patient focused voice to create a sustainable model. I frequently recall comments from a primary care team reflecting on struggles with ongoing change ‘we have to persist to ensure care is driven by primary care establishing the standards of quality for their patients, not on care driven by payer requirements.’ Achieving a healthcare system where primary care sets the standards of care will go far in ensuring a high quality, high value healthcare system. 


Written by Diane Cardwell, MPA, NP, PA-C, Practice Facilitator, HealthTeamWorks


i Tikkanen, R and Abrams, M.K. (2020). U.S. Health Care from a Global Perspective, 2019: Higher Spending, Worse Outcomes? The Commonwealth Fund.

ii Centers for Medicare & Medicaid Services. (n.d.) APMs Overview.

iii Primary Care Collaborative. (2020). Shared Principles of Primary Care.

iv Centers for Medicare & Medicaid Services. (n.d.) MIPS Alternative Payment Models (APMs).

v Centers for Medicare & Medicaid Services. (n.d.) Advanced Alternative Payment Models (APMs).

vi Centers for Medicare & Medicaid Services. (n.d.) All-Payer Advanced Alternative Payment Models (APMs) Option.