CMS Official: Logistical Limits Restricting New Payment Models

HHS Secretary Alex Azar appears to have rejected all 10 physician-focused payment models that PTAC has recommended.

Aug. 8—Medicare has not approved more alternative payment models—despite calls by many hospitals and physicians for more of them—due to limits in time, staff, and funding, a Medicare executive said.

In response to a question at a physician payment model discussion in Washington, D.C., an executive helping lead the development of new payment models at the Centers for Medicare & Medicaid Services (CMS) said the need for more research on effectiveness is a leading challenge.

“The other barrier or challenge we have is limited resources,” Arrah Tabe-Bedward, deputy director of the Center for Medicare and Medicaid Innovation (CMMI) at CMS, said during an event conducted by the Patient-Centered Primary Care Collaborative (PCPCC). “There are a lot of things that we would love to be able to test.”

The Affordable are Act (ACA), which created CMMI, appropriated the office $10 billion per year to test new payment models.

“Beyond the funds required to do those models, there are other resources—FTEs—that are limited,” Tabe-Bedward said. “And so we have to be thoughtful, we have to be selective about those things that we choose to test.”

Hospital and physician advocates have increasingly urged CMMI to add to the models operated by CMS—which has implemented between 30 and 40 initiatives in recent years—to expand the opportunities for different types of providers in different locations.

For instance, specialty physicians said none of the existing models are focused on them, and they have urged CMS to begin testing models as recommended by the Physician-Focused Payment Model Technical Advisory Committee (PTAC). That panel was created by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), but Alex Azar, secretary of the Department of Health and Human Services (HHS), appeared to some to reject all 10 payment models that PTAC has recommended in his June letter.

“We need more experimentation here and we need more investment,” Ann Greiner, CEO and president of PCPCC, said in an interview, referring to new Medicare physician-focused models.

However, Greiner cautioned against shifting CMMI resources from the Comprehensive Primary Care Plus (CPC+) model, which focuses on primary care, to specialist-focused models.

Tabe-Bedward said in an interview that she was not specifically referring to PTAC models when she blamed resource constraints for not moving forward on more alternative payment models (APMs).

A CMS spokesman said in an email that the agency is continuing to coordinate its development of new models with PTAC and values the input from providers on the frontlines. He encouraged the public to provide feedback on an overhaul of some PTAC processes, the comment period for which closes Sept. 7.

“We are very consciously trying to add to that target-rich environment with a number of different options for clinicians—so recognizing that not all clinicians are at the same place and don’t have the same capacity for taking on risk, and haven’t moved as far along on the transformation line as their counterparts may have,” Tabe-Bedward said.

CMS is looking at additional payment model options for specialties, providers with varying “appetites for risk,” small providers, and rural providers, she said

PCMH Findings

The key role of physicians, especially primary care physicians who operate as patient-centered medical homes (PCMHs), in helping APMs succeed was underscored in a PCPCC analysis released this week. The quantitative analysis concluded that Medicare accountable care organizations (ACOs) with a higher proportion of PCMH primary care physicians were more likely to generate savings and obtain higher quality scores.

ACOs with more PCMH primary care physicians averaged savings of 1.2 percent to 1.9 percent, the analysis found, compared with 0.6 percent for all ACOs studied.

The researchers’ literature review also found ACOs with a primary care orientation generally had better cost outcomes and greater quality improvements. However, such ACOs had mixed results in their efforts to reduce emergency department usage and inpatient hospitalization while increasing primary care visits, the review found.

Industry executives noted that keys to ACO success also include elements common in hospital-led models, such as large financial resources—for instance, to fund community-based care coordinators—and close relationships with hospitals to provide primary care physicians with notice of their patients’ admissions or ED use.

“I guess you could say that if you are part of a big hospital system you are more likely to have those financial resources,” said Yalda Jabbarpour, MD, an author of the PCPCC analysis. “What I and others were pointing to is we need to change that.”

APM resources need to be shifted away from hospitals because their financial success is still tightly linked to higher volumes of patient admissions, Jabbarpour said in an interview.

Her research analysis also found that among health systems that had the most ACO success—which included both physician-led and hospital-led systems—there was “a very good relationship” between the organization’s hospitals and primary care physicians, and they agreed on the same clinical and financial goals.

“It’s hard to separate them completely,” Jabbarpour said, referring to hospitals and primary care physicians. “I don’t think it’s a black-and-white picture.”

Insurer Response

At least one private insurer is planning to elevate providers that take on such value-based overhauls above providers that do not.

The PCPCC analysis showed that “not all providers are the same, and they shouldn’t be treated the same—because if you treat them all the same, then the people who went out on a limb and did the hard capital investments and political investments to do this work early and well, why would they stay engaged?” said Mai Pham, MD, MPH, vice president of provider alignment solutions for Anthem.

Anthem plans an effort to reward higher-value providers by steering more patients to them, improving payments, and ending prior authorization for them, she said.

“It is time that we inject more competition into the provider market by differentiating those who are truly higher-value and have demonstrated that,” Pham said.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare