The American Hospital Association (AHA) recently submitted a letter to federal health leaders urging critical reforms to make it easier for hospitals, health systems, and physicians to participate in value-based care models. Read the full letter here.

Representing nearly 5,000 hospitals and over 270,000 physicians, the AHA outlined key changes needed to accelerate the shift to population-based total cost of care (PB-TCOC) models. Recommendations include adopting principles like strong risk adjustment, voluntary participation, transparency in program design, longer model durations, and upfront investment support for providers.

The AHA also called for removing revenue-based barriers that currently prevent many hospitals and physician groups—especially those in rural and underserved areas—from accessing funding and participating fully in alternative payment models (APMs). They highlighted research showing no significant performance difference between high- and low-revenue organizations.

In addition, the AHA urged an extension of incentive payments tied to advanced APMs, helping providers invest in care improvements like care coordination, digital tools, and patient support programs.

Finally, the AHA pushed back against misconceptions around hospital-driven physician practice acquisitions, citing data that private equity firms and insurers account for the vast majority of recent acquisitions—not hospitals.

These reforms, the AHA emphasized, are crucial to building a fairer, more sustainable healthcare system centered around better outcomes and lower costs.