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Tuesday Apr 30, 2019

CMS Heeds AAFP Advice on New Payment Models

"It's a bold strategy, Cotton. Let's see if it pays off for 'em."
-- Jason Bateman as Pepper Brooks in
Dodgeball: A True Underdog Story

[headshot of Russell Kohl, M.D. and Seema Verma]

AAFP Vice Speaker Russell Kohl, M.D., poses with CMS Administrator Seema Verma, M.P.H. Kohl spoke April 22 at the launch of the CMS Primary Cares Initiative.

Last week, CMS and the Center for Medicare and Medicaid Innovation held a public event to unveil the CMS Primary Cares Initiative.(innovation.cms.gov)  

The event featured the top three health care officials in the federal government: HHS Secretary Alex Azar, CMS Administrator Seema Verma, M.P.H., and CMMI Director Adam Boehler. Among the federal government's health care leadership stood a representative from one physician organization -- the AAFP.

It is hard for me to articulate the impact of this announcement, but I would suggest to you that having the three top health care officials in the U.S. government speak publicly and forcefully about the importance of greater investment in primary care was a moment of significance. Having those same officials each comment on the importance of the AAFP's collaboration on the new models was also noteworthy. Most important, however, was the creation and pending implementation of new delivery and payment models that afford family physicians an alternative to the legacy fee-for-service system.

CMS announced five new payment models under two paths:

  • Primary Care First
  • Direct Contracting

The announcement of the CMS Primary Cares Initiative brings to a close nearly three years of work on the part of the AAFP to develop and implement a primary care alternative payment model. It is worth noting that the Primary Care First path strongly resembles and reflects the core elements of the AAFP's Advanced Primary Care Alternative Payment Model.(38 page PDF)  

In his prepared comments (starting at 34:30 in this video(youtu.be)), AAFP Vice Speaker Russell Kohl, M.D., of Stilwell, Kan., highlighted the AAFP's years of work to create and implement new primary care delivery and payment models and the significance of the CMS Primary Cares Initiative.

"The AAFP and our primary care colleagues have embarked on a quest to create a delivery system that reflects the core values of primary care and facilitates innovation in primary care delivery that rewards comprehensive and continuous patient-centered care, and not simply episodes of care or services," Kohl said. "For too long, we have approached delivery system reform as identifying delivery systems that neatly conformed with our payment system -- primarily fee-for-service. The AAFP, like so many, grew to understand that fee-for-service is largely incongruent with the best practices of advanced, patient-centered family medicine.

"To truly unleash the power of primary care, we must do two things: Unhinge it from the episodic-based incentives of fee-for-service, and eliminate the administrative complexity of practice that distracts family physicians from patient care. In short, it has become clear that we must create payment models that support our desired delivery models."

There are reasons to be optimistic about these new models, especially the Primary Care First program. To help you better understand these new models, we have prepared high-level summaries of the Primary Care First and Direct Contracting paths and the five participation options available to family physicians and other primary care physicians.

Primary Care First

The Primary Care First path establishes two payment model options: one general and one for high-need populations.

The Primary Care First general model includes a risk-adjusted, population-based payment, plus a flat visit fee for each face-to-face encounter with the primary care physician. This model includes an upside performance-based payment that is as much as 50% of revenue. Downside risk is capped at 10% of revenue.

The Primary Care First High-need Populations model allows participating practices to opt in to the Seriously Ill Population portion of the model. These populations are identified through claims data and are defined as having multiple comorbid conditions, defined utilization patterns and the presence of proxies for frailty. Palliative care and hospice practices can apply to participate in just the Seriously Ill Population portion of the PCF model.

Primary Care First aims to test whether the delivery of advanced primary care can reduce total cost of care. The model allows practices to assume financial risk in exchange for reduced administrative burden and prospective population-based payments. The program also includes a model for high-need, seriously ill beneficiaries who lack coordinated primary care. Practices that participate only in the Seriously Ill Population portion receive a higher monthly payment per patient and are ineligible for population- and performance-based payments. Primary Care First practices that choose to participate in the Seriously Ill Population program also will receive the higher monthly payment for each attributed, eligible patient.

Primary Care First is open to physicians -- as well as nonphysicians, such as clinical nurse specialists, nurse practitioners and physician assistants -- in primary care specialties, defined as family medicine, internal medicine, general medicine, geriatric medicine, and hospice and palliative medicine, who meet certain criteria.

Specifically, participants must

  • have 125 attributed Medicare beneficiaries, attest to advanced primary care functions (such as 24/7 access and empanelment) and have 70% of practice revenue generated from primary care services;
  • have experience with value-based payment arrangements and payments based on cost, quality, and/or utilization performance;
  • use 2015 Edition Certified Electronic Health Record Technology, support data exchange with other providers and health systems via Application Programming Interface, and connect to their regional health information exchange;
  • practice in Comprehensive Primary Care Plus states/regions(innovation.cms.gov) or in Alaska, California, Delaware, Florida, Massachusetts, Maine, New Hampshire or Virginia.

Direct Contracting

The Direct Contracting path establishes three options: Professional Population-based Payment, Global PBP and Geographic PBP.

The professional option incorporates Primary Care Capitation -- risk-adjusted monthly payment for enhanced primary care services -- as well as 50% savings/losses.

The global option incorporates Primary Care Capitation or Total Care Capitation -- risk-adjusted monthly payments for all services provided by participants and preferred providers with whom they have agreements -- as well as 100% savings/losses (i.e., full-risk capitation).

The professional and global options are aimed at organizations operating in the Medicare Advantage program and Medicaid Managed Care Organizations that provide Medicaid benefits for full-benefit, dually eligible beneficiaries.

The geographic option is similar to Global PBP, but it includes responsibility for total cost of care for all Medicare fee-for-service beneficiaries in a defined geographic region.

As currently written, the geographic option would encourage participation from innovative organizations such as health plans and health care technology companies that want to contract with physicians and suppliers and take risk for a Medicare fee-for-service population in a defined geographic region.

Medicare accountable care organizations will be eligible to participate in all three Direct Contracting options.

Built on the Next Generation ACO model,(innovation.cms.gov) the Direct Contracting model offers new forms of payments, enhanced cash flow options and an enhanced level of flexibility to allow practices the ability to meet beneficiaries' medical and social needs. The Direct Contracting model aims to reduce cost and improve the quality of care for beneficiaries in Medicare fee-for-service.

There are no geographic limitations on this model. To participate, practices must have a minimum of 5,000 attributed Medicare patients for the professional or global options, or at least 75,000 beneficiaries for the region option. They also must sign a nonbinding letter of intent.

In addition to this summary, I would point you toward an excellent story from AAFP News and the following CMS resources:

I understand that this proposal is not perfect. There are gaps. The most notable gap is that the model isn't available to all family physicians. Although we understand that the states and regions were chosen to enable CMS to roll out the program rapidly, we have already expressed our desire to see the opportunities to participate expanded to more states starting in 2021. Expanding the number of participating states will be a priority for the AAFP moving forward.

Although these concerns will drive our next steps, we are mindful that these new models represent the most significant advancement of primary care-focused delivery and payment models.

Posted at 09:19AM Apr 30, 2019 by Shawn Martin

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Shawn Martin, AAFP Senior Vice President of Advocacy, Practice Advancement and Policy.

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