Task Force Explores Payment Models to Promote, Sustain Needed Care

June 14, 2016 04:06 pm News Staff

A recently released white paper explores how to ensure that new and emerging payment models within the U.S. health care system make it possible for family physicians and other health care professionals to care for their neediest patients.

[Female doc holding older female patient's hand]

The paper(www.hcttf.org), titled "Payment to Promote Sustainability of Care Management Models for High-Need, High-Cost Patients," was released on June 1 by the Health Care Transformation Task Force(www.hcttf.org), a consortium of patients, payers, providers and purchasers looking to accelerate the pace of health care delivery transformation.

In a June 1 press release(www.hcttf.org), Jeff Micklos, J.D., executive director of the task force, said the recommendations were intended to speed adoption of population-based payment for care management services and help align payment methods across the U.S. health care system.

"Well-designed population-based payment models have the potential to reorient care management to provide better outcomes to those patients who need it most, and thereby increase value," he said.

Story Highlights
  • A white paper recently released by the Health Care Transformation Task Force explores how to ensure that new and emerging payment models will promote and sustain care for high-need, high-cost patients.
  • Statistics from the Agency for Healthcare Research and Quality show that 5 percent of patients nationwide drive 50 percent of total U.S. health care spending.
  • The task force identified high-need, high-cost patients as those who are nearing the end of life, undergoing high-cost health events and/or experiencing multiple chronic illnesses, including behavioral health issues.

That's important, the task force noted, because according to statistics from the Agency for Healthcare Research and Quality, 5 percent of patients drive 50 percent of total U.S. health care spending.

Improving care for high-cost patients is the focus of the specific work group that authored the paper. High-need, high-cost patients considered by the group included individuals who are

  • nearing the end of life,
  • undergoing high-cost health events and/or
  • experiencing multiple chronic illnesses, including behavioral health issues.

Clearly, many patients cared for by America's family physicians fall into those patient groups.

That's why the AAFP, very much involved in the development of new care models aimed at helping family physicians deliver high-quality health care at lower costs, joined the task force in September 2015.

This most recent white paper on payment is the third and final product from the task force's Improving Care for High-Cost Patient Work Group.

To get a full picture of the group's work, read its two previous white papers, titled "Proactively Identifying the High-Cost Population(www.hcttf.org)" and "Developing Care Management Programs to Serve High-Need, High-Cost Populations(www.hcttf.org)."

Key Considerations

Work group members cited several "unique features" to keep in mind when designing payment models to support complex care management initiatives for high-need, high-cost patients:

  • This population of patients is "ever changing," the authors noted. "Models must periodically re-evaluate this population and adjust the provision of care management services accordingly."
  • Health care providers must have an incentive to seek out patients who would most benefit from care management services, but "without inadvertently encouraging 'cherry picking' or creating other problematic incentives," wrote the authors. With proper risk adjustment, population-based payment gives providers incentive to find savings by managing care for those most in need and reallocating those savings to improve care in other areas.
  • Provider incentives must be based on the triple aim of improved care, improved outcomes and lower costs.
  • Health care providers need the protection found in insurance risk adjustment when dealing with high-need, high cost patients.
  • Physicians and other health care providers face financial barriers when looking to make "initial programmatic and infrastructure investments." For instance, they often purchase new health IT systems, develop patient supports for social issues such as housing and expand primary care services in underserved areas. "Payers should recognize the initial investment and ongoing operational costs of such infrastructure," said the work group.
  • The most effective programs engage and partner with patients as they learn to manage their own health care. "Engaging patients, families, caregivers and others as partners in care is the best way to encourage patients to consistently seek care," said the authors. And financial incentives -- such as waiving copayments for face-to-face visits with care coordinators -- can encourage the establishment of strong ties between patients and health care professionals.


Ongoing experimentation -- by both health care professionals and insurers -- with care models designed for high-need, high-cost patients has shown that only some alternative payment models are able to sustain care over time.

The white paper's authors noted that at their core, care models "require upfront investments in outpatient services and care across the continuum" such as face-to-face care coordination, mental health care, social services and home visits.

The end goal is to prevent ER visits and hospitalization.

Therefore, the authors made four recommendations regarding the types of supportive payment models that likely would be most successful.

First, the authors suggested a per-member, per-month care management fee for high-risk patients that is based on triple aim outcomes and provides for shared savings. "Payers are naturally cautious about offering upfront payment alone, without at least some shared risk if savings are not realized," acknowledged the authors.

Secondly, they noted that physicians and other health care professionals with an ongoing care management program in place for their high-need, high-cost patients "prefer full-risk capitation payments." Such payment provides a "cash-flow advantage" for costs attributed, for instance, to care coordinators and the kinds of systems needed to manage such patients across care settings.

Further, the authors noted the downside of traditional fee-for-service payments -- notably, that they do not pay physicians and other providers for care management services.

"Provider systems face painful choices between providing needed services to patients based on their clinical needs, regardless of their plan or benefit design, and the financial sustainability of their organization when they provide care that is not paid for," wrote the authors.

They pointed out that in some cases where care management programs are in place for some patients covered under supportive payment models, provider systems usually accept fee-for-service patients referred by a contracted physician "but do not actively recruit patients."

Lastly, noted the authors, the use of CPT codes to represent fee-for-service care management services "is insufficient to advance adoption of programs for high-need, high-cost patients."

The work group went even further on this issue, saying it supports chronic care management CPT codes to "offset" some cost for care coordination. "However, any strategy that simply adds more fee-for-service codes is misguided," they said.


Work group authors reiterated that a small percentage of patients account for a large chunk of the nation's health care expenditures.

Policymakers have made much progress in both identifying patients in that high-need, high-cost population and outlining the care management services they need.

However, the authors noted, to date there has not been "broad-scale adoption of payment models for care management services that create incentives for accountability for the total cost of care furnished to those patients."

Furthermore, task force payer and provider members pointed out that broad adoption of care management programs across payers and settings was hindered by fee-for-service payment and "the presence of multiple funding streams within a single program."

Therefore, "a transition to population-based payment is imperative to ensure that patients with the highest need and highest costs are offered necessary services, regardless of insurer, and that the programs in which they are enrolled are sustainable over time," concluded the authors.

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