CMS Primary Cares Initiative: Much Promise/Many Challenges
On April 22, 2019, the Centers for Medicare and Medicaid Services (CMS) announced the Primary Cares Initiative. Administered through the CMS Innovation Center, the CMS Primary Cares Initiative will provide primary care practices and other providers with five new payment model options:
- Primary Care First
- High Need Populations
- Direct Contracting
CMS has touted these new models as an important step in moving toward a value-based system. The agency expects these voluntary models to be adopted by providers caring for more than 25% of all Medicare fee for service beneficiaries, or nearly 11 million patients. The initial reaction of the provider community has been positive, focusing on the reduction in administrative expenses promised by the models’ fixed payments. In addition, the potential bonuses under the Primary Cares Initiatives appear to be far greater than what accountable care organizations can currently achieve under the Medicare Shared Saving Program
Several very important issues, however, have not been addressed. CMS has not provided the level of detail necessary either to fully evaluate the viability of the models or to calculate a participant’s financial risk. CMS’s track record in administering other value-based models is also an issue. Participants have complained of shifting benchmarks, the agency’s failure to furnish data in a timely manner, and unpredictable design changes. Hopefully, more details regarding the Primary Cares Initiatives will be forthcoming soon, and CMS will administer the models in a more provider-friendly manner.
CMS held the first round of webinars on the Primary Care First and Direct Contracting models during the week of April 29. In its May 30 webinar on the Primary Care First model, CMS touted the following benefits for participating practices:
- Less administrative burden and more flexibility;
- Ability to increase revenue with performance-based payments that reward participants for easily understood primary care outcomes;
- Enhanced access to actionable, timely data (CMS will provide data to practices, including data regarding practices’ performance compared to peers);
- Focus on single outcome measure that matters most to patients: acute hospital utilization.
The new primary care payment models are described in more detail below.
Primary Care First
Regions: For the Primary Care First 2020 start date CMS selected 26 regions:
- Alaska (statewide)
- Arkansas (statewide)
- California (statewide)
- Colorado (statewide)
- Delaware (statewide)
- Florida (statewide)
- Greater Buffalo region (New York)
- Greater Kansas City region (Kansas and Missouri)
- Greater Philadelphia region (Pennsylvania)
- Hawaii (statewide)
- Louisiana (statewide)
- Maine (statewide)
- Massachusetts (statewide)
- Michigan (statewide)
- Montana (statewide)
- Nebraska (statewide)
- New Hampshire (statewide)
- New Jersey (statewide)
- North Dakota (statewide)
- North Hudson-Capital region (New York)
- Ohio and Northern Kentucky region (statewide in Ohio and partial state in Kentucky)
- Oklahoma (statewide)
- Oregon (statewide)
- Rhode Island (statewide)
- Tennessee (statewide)
- Virginia (statewide)
Eligibility. Primary care practices located in one of the selected regions and that meet the following requirements are eligible to participate, starting 2020:
- Provide primary care services to at least 125 attributed Medicare beneficiaries at a particular location;
- Have primary care services account for at least 70% of the practices’ collective billing based on revenue;
- Have experience with value-based payment arrangements or payments based on cost, quality and/or utilization performance;
- Use 2015 Edition Certified Electronic Health Record Technology (CEHRT);
- Support data exchange with other providers and health systems via Application Programming Interface;
- Connect to their regional health information exchange (HIE);
- Attest via questions in the Practice Application to a limited set of advanced primary care delivery capabilities, such as 24/7 access to a practitioner or nurse call line; and
- Meet the requirements of the Primary Care First Participation Agreement.
CMS has not yet provided guidance on how applicants will demonstrate a beneficiary is attributed to the practice. However, CMS does state that in its Fact Sheet it “will prioritize patient choice in the assignment of Medicare beneficiaries.”
Practices may limited their participation in Primary Care First to exclusively caring for Seriously Ill Population (SIP) patients. However, such practices must demonstrate in their application materials that they have a network of relationships with other care organizations in the community to ensure that beneficiaries can access the care best suited to their longer-term needs.
CMS will also encourage other payers (Medicare Advantage plans, Medicaid managed care plans, commercial health insurers, and state Medicaid agencies) to align payment, quality measurement and data sharing with CMS in support of Primary Care First Practices.
Additional eligibility details will be available in the forthcoming Primary Care First Request for Applications (RFA) and Solicitation for Payer Partnership.
Application Process and Timeline. CMS will release to practices a request for Application in spring 2019. In summer 2019, practice applications will be due and solicitation of payers will take place. In fall and winter 2019, practices and payers will be selected. In January 2020, the Primary Care First model will launch and payments will begin in April 2020.
Payment Methodology. CMS’s goals with the Primary Care First payment model are to promote patient access to advanced primary care, transition primary care from fee-for-service (FFS) payments to value-driven, population-based payments, and reward high-quality, patient-focused care that reduces preventable hospitalizations. Primary Care First payments will include professional population-based payments, flat primary care visit fees and performance-based adjustments up to 50% revenue and a 10% downside based on key performance measures, including acute hospital utilization.
- Professional Population-Based Payment. Practices will be assigned a risk and placed in a corresponding practice risk group. Payments to the practices will be made per beneficiary, per month, based on the practice’s risk assignment.
|Practice Risk Group||Payment|
|Group 1 (lowest risk)||$24|
Payments will be adjusted to account for beneficiaries seeking services outside the practice. However, CMS has not specified the scope of services for which Primary Care First-participating practices will be financially responsible.
2. Flat Primary Care Visit Fee. Practices will be paid a flat $50 per face-to-face patient encounter.
3. Performance-Based Payment Adjustments. In Year 1, adjustments will be determined based on acute hospital utilization (AHU) alone. In Years 2-5, adjustments will be based on whether the practice exceeded the Quality Gateway. If the practice did not exceed it, there will be a negative 10% adjustment to total primary care payment for next applicable year. If the practice exceeded it, there will be adjustments of up to 50% of total primary care payment determined by comparing performance to three different benchmarks: national adjustment, cohort adjustments, and continuous improvement adjustment.
The national adjustment is based on the lowest quartile of acute hospital utilization performers in a national reference group.
The cohort adjustment will be based on a comparison of practice performance against other Primary Care First participants. The bottom 50% of Primary Care First practices based on performance will receive a 0% adjustment. The top 50% of Primary Care First practices based on performance will receive the following adjustments:
|Performance Level||Adjustment to Total
Primary Care Payment
|Top 20% of eligible practices||34%|
|Top 21-40% of eligible practices||27%|
|Top 41-60% of eligible practices||20%|
|Top 61-80% of eligible practices||13%|
|Top 81-100% of eligible practices||6.5%|
The continuous improvement bonus will be awarded to practices that achieve their improvement target. Potential improvement bonuses will be awarded as follows:
|Performance Level||Potential Improvement Bonus|
|Top 20% of performance-based adjustment (PBA)-eligible practices||16% of Total Primary Care Payment|
|Top 21-40% of PBA-eligible practices||13% of Total Primary Care Payment|
|Top 41-60% of PBA-eligible practices||10% of Total Primary Care Payment|
|Top 61-80% of PBA-eligible practices||7% of Total Primary Care Payment|
|Top 81-100% of PBA-eligible practices||3.5% of Total Primary Care Payment|
|Practices performing above nationwide benchmark, but below top 50% of practices||3.5% of Total Primary Care Payment|
|Practices performing at or below nationwide minimum benchmark||3.5% of Total Primary Care Payment|
4. High Need Population Payment Model Option. For the first 12 months, payments for practices serving seriously ill populations will include:
- One-time payment for first visit with SIP patient: $325 per beneficiary
- Monthly SIP payments for up to 12 months: $275 per beneficiary per month
- Flat visit fees: $50
- Quality payment: up to $50
5. Quality Gateway. Starting in Year 2, performance-based adjustments will be based on whether the practice exceeded the Quality Gateway. There are 5 discrete measures in the Quality Gateway, and the Merit-Based Inceptive Payment System (MIPS) will serve as the benchmarks for the measures. The measures are:
- CPC+ Patient Experience of Care Survey
- Diabetes: Hemoglobin A1c and Poor Control
- Controlling High Blood Pressure
- Care Plan
- Colorectal Cancer Screening
The Quality Gateway for practices serving SIP patients will be developed during the model.
- Professional Population-Based Payment (PBP). Lower risk-sharing (50% savings/losses) and includes Primary Care Capitation, a capitated, risk-adjusted monthly payment for enhanced primary care services.
- Global PBP. Highest risk sharing (100% savings/losses) and provides two payment options: Primary Care Capitation or Total Care Capitation, capitated risk-adjusted monthly payment for all services provided by DC participants and preferred providers with whom the DC Entity (DCE) has an arrangement.
- Geographic PBP. CMS is seeking public input on this option through a Request for Information (RFI).
Regions. The DC track is open to providers in all regions.
Eligibility. To be eligible to be DCEs, entities generally will need to have at least 5,000 aligned Medicare FFS beneficiaries. However, there will be an “on ramp” option for organizations new to Medicare FFS. There will also be flexibility for organizations serving dually eligible, chronically ill populations. Current Medicare ACOs are eligible to participate in all three payment model options.
The Geographic PBP option would be open to provider and supplier organizations and “innovative organizations” such as health plans, health care technology companies, and other entities interested in entering into contractual relationships with providers and suppliers and taking on risk for a Medicare FFS beneficiary population in a defined geographic target region.
Additional details on eligibility requirements and selection criteria will be available in the forthcoming Request for Applications (RFA).
Application Process and Timeline. Payment model options will start in January 2020. Performance periods will begin January 2021 and will be five years in duration.
CMS will request a Letter of Intent (LOI) from organizations interested in either the Professional PBP or Global PBP options. The LOI for Global and Professional PBP models will be available May 2, 2019, on the DC website. While submitting a LOI is a prerequisite to applying, an LOI will not bind the organization. The LOI must be received by Friday, August 2, 2019, at 11:59 AM EDT.
Following the LOI process, CMS will subsequently release a RFA. The RFA will describe the eligibility requirements, payment methodology, available benefit enhancements and selection criteria. DCEs selected for participation will be notified in fall or winter 2019, with the performance year starting January 1, 2020. Payments will begin January 1, 2021.
CMS has posted an RFI to gather additional input from the public about their perspectives on design parameters for the Geographic PBP option. The RFI is available online at: https://innovation.cms.gov/Files/x/dc-geographicpbp-rfi.pdf. Responses to the RFI are now being accepted and will be received through May 23, 2019. CMS expects to post the RFA for the Geographic PBP option in the fall of 2019.
Payment Methodology. For participants in the Professional PBP option, CMS will offer Primary Care Capitation equal to 7% of the total cost of care for enhanced primary care services, along with 50% shared savings/shared losses with CMS.
For participants in the Global PBP option, CMS will offer the choice of Primary Care Capitation or Total Care Capitation, in addition to 100% shared savings/losses.
The aggregate amount of shared savings or losses that DCEs will be eligible to receive will be determined through payment reconciliation.
The benchmarking methodology for the Professional and Global PBP options will incorporate a blend of historical spending and adjusted Medicare Advantage (MA) regional expenditures. Benchmarks will be adjusted to reflect factors (such as the risk of the population) and payments will be subject to quality performance.
For financial protections, risk corridors and stop loss will be offered to Global and Professional PBP DCEs.
CMS will offer DCEs a provisional reconciliation option. Under this provisional reconciliation, CMS will distribute interim shared losses/savings, with a final reconciliation taking place once full data are available.
The RFA will further describe payment methodology and available benefit enhancements. Future webinar topics include payment methodology, alignment and overlap, benefit enhancements and payment rule waivers, and special needs population and Medicaid MCOs.