Medicare innovation can spur the next round of payment reform

The economic imperative for better health care at a lower cost has never been more urgent. Changing the way that health care providers are paid is at the core of solving the problem. Bipartisan support has formed around the idea of flexibility and innovation in how care is delivered in conjunction with more accountability for results. But the journey toward implementing these new models of care and payment is a difficult one.

Success in these reforms means moving away from relying only or primarily on fee-for-service payments. The Centers for Medicare and Medicaid Services and, by extension, private payers rely on a highly complex system of fee-for-service prices. More than 47,000 different prices are listed for covered health care services, while many services and interventions that could lower costs and improve care — such as team-based approaches to care, , and digital health