HHS on Monday announced an initiative intended to shift primary care providers and other eligible professionals from fee-for-service (FFS) payments to value-based payments using five new voluntary payment models.
HHS Secretary Alex Azar unveiled the initiative, called CMS Primary Cares, during a press conference at the American Medical Association's headquarters. Azar said the initiative's new payment models "represent the biggest step ever taken toward" implanting value-based payments in primary care.
CMS said the new payment models could result in better care coordination for more than 25% of all Medicare FFS beneficiaries. HHS expects the models to create new opportunities for providers to coordinate care for a large share of the nearly 12 million beneficiaries who are dually eligible for Medicare and Medicaid, particularly for beneficiaries enrolled in Medicaid managed care and Medicare FFS plans.
The five new payment models—which were developed and will be implemented by CMS' Center for Medicare and Medicaid Innovation—are designed to examine whether performance-based payments paired with providers taking on financial risk will reduce health care costs and maintain or improve health outcomes and quality of care.
CMS in a fact sheet said the five payment models are divided into two paths:
The PCF path is specifically designed for primary care practices and includes two voluntary, five-year payment models:
Under both PCF payment models, participating practices will receive a simplified, total monthly payment, which CMS said will allow clinicians to focus on patient care rather than unpredictable revenue. Practices participating in a PCF payment model will receive payment adjustments based on how they perform on certain clinical quality measures, including controlling high blood pressure, managing diabetes, and screening for colorectal cancer. Practices that specialize in care for patients with complex, chronic, or severe conditions will receive higher monthly payments.
CMS said it plans to begin accepting applications to participate in the PCF payment models in spring 2019. The agency plans to launch the payment models in 26 regions throughout the United States beginning in 2020. CMS plans to accept a second round of applications for the payment models in January 2020.
The DC path is targeted at a wider range of organizations and builds on lessons learned from the Next Generation ACO model and Medicare Advantage. It includes three payment models:
CMS said the DC payment models are intended to create a competitive delivery system environment and are designed for a broader range of providers, including accountable care organizations, Medicare Advantage plans, Medicaid managed care organizations, and others with experience taking on financial risk. CMS under the DC payment models will reward participants that offer greater efficiencies and quality of care with a fixed monthly payment that can range from a share of anticipated primary care costs to the total cost of care.
CMS in a fact sheet said it plans to launch the DC–Global and DC–Professional payment models in January 2020, with performance years beginning January 2021. The models will last for five years, CMS said.
CMS issued a Request for Information seeking public comments on the DC—Geographic payment model, which the agency said "is designed to offer innovative organizations the opportunity to assume responsibility for the total cost of care and health needs of a population in a defined target region." CMS said it is seeking input on the model because of its "novelty," but plans to launch the model with a performance period beginning January 2021.
Azar said the new payment models, which "[b]uil[d] on the experience of previous models and ideas of past administrations, … will test out paying for health and outcomes rather than procedures on a much larger scale than ever before," and are "specifically designed to encourage state Medicaid programs and commercial payers to adopt similar approaches."
CMS Administrator Seema Verma said, "As we seek to unleash innovation in our health care system, we recognize that the road to value must have as many lanes as possible. Our Primary Cares Initiative is designed to give clinicians different options that advance our goal to deliver better care at a lower cost while allowing clinicians to focus on what they do best: treating patients" (HHS release, 4/22; Morse, Healthcare Finance News, 4/22; Luthi, "Transformation Hub," Modern Healthcare, 4/22; Truong, MedCity News, 4/22; Owens, "Vitals," Axios, 4/23; CMS PCF one-pager, accessed 4/23; CMS, "Primary Care First Model Options," accessed 4/23; CMS, "DC Contracting Model Options," accessed 4/23 CMS DC fact sheet, 4/22).
Yulan Egan, Practice Manager, Health Care Advisory Board
Here are my four main takeaways from CMS' announcement of these new models:
To learn more about CMS' previous overhaul of the ACO program, the "Pathways to Success" program, view our on-demand webconference and download the slides from 'Pathways to Success': What Medicare's ACO overhaul means for your risk strategy.
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