Expanded Non-Claims Payments Framework
HCAI is undertaking four coordinated efforts to collect and understand non-claims payment data, each with a distinct purpose and use case.
- Collect data on non-claims payments to quantify these payments as part of total health care expenditures
- Categorize payments to identify the purpose of the spending
Primary Care and Behavioral Health Spend
- Quantify the non-claims payments supporting primary care and behavioral health services
- Gain a better understanding of the payment structures supporting primary care and behavioral health
Alternative Payment Models (APMs)
- Identify the number of members receiving health care services through APMs
- Quantify the amount of health care spending flowing through APMs
- Understand the structure of alternative payments models in California
Health Care Payments Database (HPD)
- Collect more granular non-claims spending information to support greater health care cost transparency and inform policy decisions regarding the provision of quality health care
To facilitate consistent non-claims data collection across these use cases, HCAI developed a new framework to categorize and collect non-claims payment data, the Expanded Non-Claims Payments Framework (or Expanded Framework). This framework aims to reduce the reporting burden on data submitters while increasing comparability across HCAI initiatives. In collaboration with Freedman HealthCare and other stakeholders, HCAI developed the Expanded Framework building upon two models for categorizing alternative payment models and measuring non-claims spending – the Milbank Memorial Fund-Bailit framework and Health Care Payment Learning & Action Network (HCP-LAN) framework. The Expanded Framework payment categories better capture California’s unique care delivery and payment structures, such as the prevalence of professional capitation.
For more background information on how HCAI developed the Expanded Framework, please visit the Milbank Memorial Fund blogpost, “A New Standard for Categorizing and Collecting Non-Claims Payment Data.”
- Expanded Non-Claims Payments Framework
- Expanded Non-Claims Payments Framework Descriptions
- Summary of Changes to the Expanded Framework
Expanded Non-Claims Payments Framework
| Framework Category | Corresponding HCP-LAN Category | |
|---|---|---|
| A | Population Health and Practice Infrastructure Payments | |
| A1 | Care management/care coordination/population health/medication reconciliation | 2A |
| A2 | Primary care and behavioral health integration | 2A |
| A3 | Social care integration | 2A |
| A4 | Practice transformation payments | 2A |
| A5 | EHR/HIT infrastructure and other data analytics payments | 2A |
| B | Performance Payments | |
| B1 | Retrospective/prospective incentive payments: pay-for-reporting | 2B |
| B2 | Retrospective/prospective incentive payments: pay-for-performance | 2C |
| C | Shared Savings Payments and Recoupments | |
| C1 | Procedure-related, episode-based payments with shared savings | 3A, 3N |
| C2 | Procedure-related, episode-based payments with risk of recoupments | 3B, 3N |
| C3 | Condition-related, episode-based payments with shared savings | 3A, 3N |
| C4 | Condition-related, episode-based payments with risk of recoupments | 3B, 3N |
| C5 | Risk for total cost of care (e.g., ACO) with shared savings | 3A, 3N |
| C6 | Risk for total cost of care (e.g., ACO) with risk of recoupments | 3B, 3N |
| D | Capitation and Full Risk Payments | |
| D1 | Primary Care capitation | 4A, 4N |
| D2 | Professional capitation | 4A, 4N |
| D3 | Facility capitation | 4A, 4N |
| D4 | Behavioral Health capitation | 4A, 4N |
| D5 | Global capitation | 4B, 4N |
| D6 | Payments to Integrated, Comprehensive Payment and Delivery Systems | 4C, 4N |
| E | Other Non-Claims Payments | |
| F | Pharmacy Rebates | |
*Descriptions of the corresponding HCP-LAN categories:
2A Foundational Payments for Infrastructure and Operations: Care coordination fees, payments for HIT investments
2B Pay for Reporting: Bonuses for reporting data or penalties for not reporting data
2C Pay for Performance: Bonuses for quality performance
3A Shared Savings: Shared savings with upside risk only
3B Shared Savings and Downside Risk: Episode-based payments for procedures and comprehensive payments with upside and downside risk
3N Risk Based Payments NOT Linked to Quality
4A Condition-specific Population-based Payment: Per member per month payments, payments for specialty services, such as oncology or mental health
4B Comprehensive Population-based Payment: Global budgets or full/percent of premium payments
4C Integrated Finance and Delivery Systems: Global budgets or full/percent of premium payments in integrated systems
4N Capitated Payments NOT Linked to Quality
Expanded Non-claims Payments Framework Descriptions
| Non-claims-based Payment Categories and Subcategories | Description | Corresponding HCP-LAN Category | |
|---|---|---|---|
| A | Population Health and Infrastructure Payments | Prospective, non-claims payments paid to healthcare providers or organizations to support specific care delivery goals; not tied to performance metrics. Does not include costs associated with payer personnel, payer information technology systems or other internal payer expenses. | |
| A1 | Care management/care coordination/population health/medication reconciliation | Prospective, non-claims payments paid to healthcare providers or organizations to fund a care manager, care coordinator, or other traditionally non-billing practice team member (e.g., practice coach, patient educator, patient navigator, pharmacist, or nurse care manager) who helps providers organize clinics to function better and helps patients take charge of their health. | 2A |
| A2 | Primary care and behavioral health integration | Prospective, non-claims payments paid to healthcare providers or organizations to fund integration of primary care and behavioral health and related services that are not typically reimbursed through claims (e.g., funding behavioral health services not traditionally covered with a fee-for-service payment when provided in a primary care setting). Examples of these services include a) substance use disorder or depression screening, b) performing assessment, referral, and warm hand-off to a behavioral health clinician, c) supporting health behavior change, such as diet and exercise for managing pre-diabetes risk, d) brief interventions with a social worker or other behavioral health clinician not reimbursed via claims. | 2A |
| A3 | Social care integration | Prospective, non-claims payments paid to healthcare providers or organizations to support screening for health-related social needs, connections to social services and other interventions to address patients’ social needs, such as housing or food insecurity, that are not typically reimbursed through claims. | 2A |
| A4 | Practice transformation payments | Prospective, non-claims payments paid to healthcare providers or organizations to support practice transformation which may include care team members not typically reimbursed by claims, technical assistance and training, and analytics. | 2A |
| A5 | EHR/HIT infrastructure and other data analytics payments | Prospective, non-claims payments paid to healthcare providers or organizations to support providers in adopting and utilizing health information technology, such as electronic medical records and health information exchanges, software that enables practices to analyze quality and/or costs, and/or the cost of a data analyst to support practices. | 2A |
| B | Performance Payments | Non-claims bonus payments paid to healthcare providers or organizations for reporting data or achieving specific goals for quality, cost reduction, equity, or another performance achievement domain. | |
| B1 | Pay-for-reporting payment | Non-claims bonus payments paid to healthcare providers or organizations for reporting data related to quality, cost reduction, equity, or another performance achievement domain. | 2B |
| B2 | Pay-for-performance payments | Non-claims bonus payments paid to healthcare providers or organizations for achieving specific, predefined goals for quality, cost reduction, equity, or another performance achievement domain. | 2C |
| C | Shared Savings Payments and Recoupments | Non-claims payments to healthcare providers or organizations (or recouped from healthcare providers or organizations) based on performance relative to a defined spending target. Shared savings payments and recoupments can be associated with different types of budgets, including but not limited to episode of care and total cost of care. Dollars reported in this category should reflect only the non-claims shared savings payment or recoupment, not the fee-for-service component. Recouped dollars should be reported as a negative value. Payments in this category may be considered “linked to quality” if the shared savings payment or any other component of the provider’s payment was adjusted based on specific predefined goals for quality. For example, if the provider received a performance payment in recognition of quality performance in addition to the shared savings payment, then the shared savings payment would be considered “linked to quality.” Payments in this category may not be “linked to quality”. | |
| C1 | Procedure-related, episode-based payments with shared savings | Non-claims payments to healthcare providers or organizations for a procedure-based episode (e.g., joint replacement). Under these payments, a provider may earn shared savings based on performance relative to a defined spending target for the episode. Under this type of payment, there is no risk of the payer recouping a portion of the initial fee-for-service payment if the defined spending target is not met. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. | 3A, 3N |
| C2 | Procedure-related, episode-based payments with risk of recoupments | Non-claims payments to healthcare providers or organizations (or recouped from healthcare providers or organizations) for a procedure-based episode (e.g., joint replacement). Under these payments, a provider may earn shared savings based on performance relative to a defined spending target for the episode. If the defined spending target is not met, the payer may recoup a portion of the initial fee-for-service payment. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. | 3B, 3N |
| C3 | Condition-related, episode-based payments with shared savings | Non-claims payments to healthcare providers or organizations for a condition-based episode (e.g., diabetes). Under these payments, a provider may earn shared savings based on performance relative to a defined spending target for the episode. Under this type of payment, there is no risk of the payer recouping a portion of the initial fee-for-service payment if the defined spending target is not met. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. | 3A, 3N |
| C4 | Condition-related, episode-based payments with risk of recoupments | Non-claims payments to healthcare providers or organizations (or recouped from healthcare providers or organizations) for a condition-based episode (e.g., diabetes). Under these payments, a provider may earn shared savings based on performance relative to a defined spending target for the episode. If the defined spending target is not met, the payer may recoup a portion of the initial fee-for-service payment. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. | 3B, 3N |
| C5 | Risk for total cost of care (e.g., ACO) with shared savings | Payment models in which the provider may earn a non-claims payment, often referred to as shared savings, based on performance relative to a defined total cost of care spending target. Under this type of payment, there is no risk of the payer recouping a portion of the initial fee-for-service payment if the defined spending target is not met. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. These models must offer providers a minimum of 40% shared savings if quality performance and other terms are met. Models offering a lessor percentage of shared savings are classified as “Performance Payments.” Providers that would be classified by CMS as “low revenue” may be eligible for shared savings at a lower rate of 20% if they do not meet minimum savings requirements. | 3A, 3N |
| C6 | Risk for total cost of care (e.g., ACO) with risk of recoupments | Payment models in which the provider may earn a non-claims payment, often referred to as shared savings, based on performance relative to a defined total cost of care spending target. If the defined spending target is not met, the payer may recoup a portion of the initial fee-for-service payment. Payment models in this subcategory should be based on a fee-for-service architecture. Payment models paid predominantly via capitation should be classified under the appropriate “Capitation and Full Risk Payment” subcategory. These models must offer providers a minimum of 50% shared savings if quality performance and other terms are met. Models offering a lessor percentage of shared savings are classified as “Performance Payments.” Providers that would be classified by CMS as “low revenue” may be eligible for shared savings at a lower rate of 25% if they do not meet minimum shared savings requirements. These models also must put providers at risk for at least 30% of losses. Models offering less than this degree of risk are classified as “Risk for total cost of care with shared savings.” | 3B, 3N |
| D | Capitation and Full Risk Payments | Per capita, non-claims payments paid to healthcare providers or organizations to provide a defined set of services to a designated population of patients over a defined period of time. Payments in this category may be considered “linked to quality” if the capitation payment or any other component of the provider’s payment was adjusted based on specific, pre-defined goals for quality. For example, if the provider received a performance payment in recognition of quality performance in addition to the capitation payment, then the capitation payment would be considered “linked to quality.” Payments in this category may not be “linked to quality”. | |
| D1 | Primary Care Capitation | Per capita, non-claims payments paid to healthcare organizations or providers to provide primary care services to a designated patient population over a defined period of time. Services are restricted to primary care services performed by primary care teams. | 4A, 4N |
| D2 | Professional Capitation | Per capita, non-claims payments paid to healthcare organizations or providers to provide professional services to a designated patient population over a defined period of time. Services typically include primary care clinician, specialty care physician services, and other professional and ancillary services. | 4A, 4N |
| D3 | Facility Capitation | Per capita, non-claims payments paid to healthcare organizations or providers to provide inpatient and outpatient facility services to a designated patient population over a defined period of time. | 4A, 4N |
| D4 | Behavioral Health Capitation | Per capita, non-claims payments paid to healthcare organizations or providers to provide behavioral health services to a designated patient population over a defined period of time. May include professional, facility, and/or residential services. | 4A, 4N |
| D5 | Global Capitation | Per capita, non-claims payments paid to healthcare organizations or providers to provide comprehensive set of services to a designated patient population over a defined period of time. Services typically include primary care, specialty care, other professional and ancillary, inpatient hospital, and outpatient hospital at a minimum. Certain services such as behavioral health or pharmacy may be carved out. | 4B, 4N |
| D6 | Payments to Integrated, Comprehensive Payment and Delivery Systems | Per capita, non-claims payments paid to healthcare organizations and providers to provide a comprehensive set of services to a designated patient population over a defined period of time. Services typically include primary care, specialty care, other professional and ancillary, inpatient hospital and outpatient hospital at a minimum. Certain services such as behavioral health or pharmacy may be carved out. This category differs from the global capitation category because the provider organization and the payer organization are a single, integrated entity. | 4C, 4N |
| E | Other Non-Claims Payments | Any other payments to a healthcare provider or organization not made on the basis of a claim for health care benefits and/or services that cannot be properly classified elsewhere. This may include retroactive denials, overpayments, and payments made as the result of an audit. | |
| F | Pharmacy Rebates | Payments, regardless of how categorized, paid by the pharmaceutical manufacturer or pharmacy benefits manager (PBM) to a payer or fully integrated delivery system. |
Summary of Changes to the Expanded Framework
| Date | Summary of Changes |
|---|---|
| November 2023 | Draft presented at the Health Care Affordability Advisory Committee meeting on November 30, 2023. |
| October 2024 | · Added 3N to Corresponding HCP-LAN Category for payment subcategories C1-C6 |
| · Added 4N to Corresponding HCP-LAN Category for payment subcategories D1-D6 | |
| · Updated description of Other Non-Claims Payments to remove governmental payer grants and shortfall payments to providers. |