Alternative Payment Model Valuation for Compliance, Success Under APMs

valapm-headerPYA has released a new white paper that demonstrates the appraiser’s key role in determining fair market value for financial arrangements under alternative payment models, allowing providers to pursue new financial relationships without risk under fraud and abuse laws.

A new white paper from PYA, “Valuation of Alternative Payment Models,” addresses the challenges involved in determining fair market value for financial arrangements between and among alternative payment model (APM) participants.  It explores the intersection of APMs with fraud and abuse laws and sets forth the key principles for valuing APMs.

With improved care and reduced costs in mind, payers have developed APMs to compensate providers based not on the volume of services they provide, but the quality of care provided.  While most guidance related to these new reimbursement models has focused solely on the nuances of APMs, PYA’s white paper addresses challenges for appraisers as well as providers in valuing such arrangements.   As the paper points out, overcoming fraud and abuse concerns by demonstrating fair market value will be critical in the transition from volume-based to value-based reimbursement.

According to the paper, “The health of our economy is tied directly to the success of the transition from volume-based to value-based reimbursement, given these APMs’ potential for driving down healthcare spending. . . .  Although valuation of APMs is less straightforward than valuation of productivity-based compensation models, appraisers can identify and employ reliable standards by which to evaluate fair market value.”

PYA’s professionals have the expertise and experience necessary to assist with the transition to, and valuation of, alternative payment arrangements.  We provide fair market value and commercial reasonableness assessments of provider network revenue distributions to ensure confidence with compliance.  And, through appropriately designed plans that incentivize behavior change, we can help providers reach their population health goals.


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