At the Center for Consumer Engagement in Health Innovation, we’ve long been champions of the important role primary care plays in improving health outcomes, lowering health care costs and achieving health equity. This is especially true for patients with complex health needs, who benefit greatly from the longitudinal relationship and care coordination that primary care professionals often provide. We’ve made improving primary care a top priority of the Center’s 2019-2020 policy agenda, releasing a report on state- and federal-level policy opportunities to improve primary care, and actively engaging with partnerswho promote primary care as the cornerstone of the health care system.

So, we were excited last month when the Center for Medicare and Medicaid Innovation announced they were pursuing new innovative primary care payment and delivery models in Medicare. I was on hand, along with Center Director Ann Hwang, for the big roll out at the American Medical Association late last month where we learned more details about these new models. Primary Care First builds on earlier models that focused on helping primary care practices provide more comprehensive and advanced primary care services such as care coordination, integrated behavioral health care, and attention to patients’ social needs. These earlier models provided practices with small monthly payments for each patient in their practice to account for the extra resources needed to provide comprehensive care and allowed some more advanced practices to reduce their reliance on fee-for-service payments. The Primary Care First model takes this concept further, by increasing the amount of “per patient” payments (payments based on the number and acuity of patients cared for by the practice) and decreasing the component due to “per visit” payments. The total amount of payment to practices will also be adjusted based on their ability to meet certain quality measures and reduce patient hospitalization (this is called a performance-based payment). This model also includes a “seriously ill patients” track that pays practices to provide care coordination to patients with complex health needs who are currently without a primary care provider.

The Direct Contracting model is a bit more complicated and is meant to build on lessons learned from Medicare Accountable Care Organization (ACO) models such as the Medicare Shared Savings Program and Next Generation ACOs. This model will offer three different voluntary risk sharing options, where health organizations (such as physician-managed organizations) known as Direct Contracting Entities (DCEs) receive set payment amounts to cover the anticipated cost of their patients’ care. If their patients’ costs are higher than the payment amount, the provider may lose money, but if their patients’ costs are lower than the payment amount, the provider may earn money. The idea behind these kinds of arrangements is that providers would have incentives to deliver care more efficiently, and have the flexibility to provide the types of services, such as care coordination and addressing a patient’s social needs, that aren’t captured in a fee for service payment system.

The direct contracting model has three different options that differ in the degree that the DCEs share in the potential savings or losses, which health care services are included in the capitated payment, and what populations the DCEs are responsible for. One option, which would allow DCEs to take on risk for an entire geographic region, isn’t yet finalized and CMS is seeking public input on how this option would work. Hidden in the announcement as well was an initiative that affects dual-eligible enrollees – people who are enrolled in Medicaid and Medicare. For dual-eligibles receiving Medicaid benefits through a Medicaid managed care plan, that managed care plan can now be paid by Medicare to provide care coordination and to meet quality and payment incentives.

You can read about the proposed models in more detail here. While we’re excited about the general direction CMMI is heading, we do have some concerns about how the models will be implemented and will be paying special attention to how the models deal with:

  • Preserving beneficiaries’ choice of providers and plans
  • Preserving important beneficiary protections, including access to services and rights to grievances and appeals
  • Calculating payments to ensure there is not an incentive to stint on care and that patients with complex health and social needs are not disadvantaged by the models
  • Educating beneficiaries about their choices and ensuring they understand what participation in one of the new models means
  • Defining the attributes of advanced primary care to ensure practices participating in the new models are able to meet patients’ needs

These models represent a major shift in how health care will be paid for going forward and signal the important role primary care practices play in this shift. CMS expects that approximately a quarter of primary care practices in the country will be a part of one of these new models. That’s why we will be following the progress and implementation closely. We will be responding to the request for information related to the direct contracting model that is due on May 23 and having ongoing conversations with policy makers and advocacy partners to ensure these new models are implemented in patient centered ways that fully harness the power of primary care to improve health outcomes.