The AHA is looking for details on the geographic PBP option under the Primary Care Initiative’s direct contracting track, including payment and benchmarking strategies.
CMS’ request for information on a new direct contracting model presents a unique opportunity for financial risk in healthcare, but the “lack of detail makes it difficult for providers to conduct well-informed analyses in response to the questions,” the American Hospital Association recently commented.
Specifically, the AHA raised concerns about the payment model proposed under the Geographic Population-Based Payment option of the Primary Cares Initiative. The hospital group urged CMS “to ensure the PBP amount in this model option is sufficient to provide participants with adequate resources to address both the medical and non-medical needs of community members.”
The Geographic PBP option is a direct contracting opportunity still under consideration by CMS. The agency announced the potential payment option as part of the direct contracting track of the Primary Cares Initiative, a voluntary value-based care program for primary care providers that also includes Primary Care First.
The direct contracting track currently has two capitated, risk-adjusted monthly payment options: professional and global PBPs. But CMS hopes to add a geography-based payment option to the mix.
The geographic PBM would make direct contracting entities responsible for the total cost of care for all Medicare fee-for-service beneficiaries in a defined target region. Direct contracting entities would establish relationships with Medicare providers and suppliers in the target region and pay them directly or have CMS continue reimbursing claims and reconciling payments.
Subject to responses from the request for information, CMS intends to initiate the application process for the geographic PBM option in the fall of 2019.
However, the AHA is calling for more details on the third direct contracting opportunity for primary care.
“Accordingly, we urge CMS to develop the model as transparently as possible so that potential applicants can make fully-informed decisions about applying for participation. More specifically, we recommend CMS consider our stakeholder feedback and continue to release additional information about its plans for the Geographic PBP model option,” the association said in response to the request for information.
As part of their stakeholder feedback, the AHA emphasized the role social determinants of health should play in the geographic PBP option.
In the request for information, CMS asked stakeholders to comment on how direct contracting entities should address SDOH. The factors can account for up to 90 percent of a patient’s outcomes, including total cost of care.
But if CMS wishes to encourage entities to address SDOH, then the agency needs to ensure geographic PBPs are based on more than historical spending data, AHA stated.
“Because many providers and other entities do not currently have the resources or ability to address SDOH with their own funds, or are restricted from doing so due to legal and regulatory barriers, spending on SDOH may not be reflected in the historical TCOC,” the association explained. “Therefore, if CMS wishes to encourage DCEs to address SDOH, it should, at least initially, provide a PBP that may exceed DCEs’ historical spending.”
“CMS also should ensure, through the use of waivers or otherwise, that there are clear legal and regulatory bases for DCEs to provide services that address SDOH,” the association added.
DCEs should receive physician self-referral law and Anti-Kickback Statute waivers to enable them to form financial relationships with provider and community organizations that can not only address SDOH, but also treat patients in a coordinated fashion, the AHA explained.
CMS should also waive Medicare program regulations that hinder care coordination, the association added. On their list of regulations needing a waiver were the skilled nursing facility three-day rule, inpatient rehabilitation facility (IRF) 60% rule, IRF three-hour rule, and the home health homebound rule, as well as certain hospital discharge planning and telehealth requirements.
“These waivers would provide participants with valuable tools to increase quality and reduce unnecessary costs, commensurate with the level of risk and accountability that CMS is asking them to assume through this and other models as it shifts the burden of risk further away from the Medicare program onto providers,” the letter stated.
The AHA also recommended several payment changes for the geographic PBP option, including setting benchmarks using a national/historical or a regional/historical blended methodology.
“CMS explains in the RFI that it would calculate DCEs’ benchmarks based on the historical Medicare Parts A and B per capita spending in a given target region. While we understand why CMS would look only to a target region’s TCOC spending to determine the benchmark for that region, we are concerned that such an approach will be untenable for low-cost regions,” the association wrote. “In areas where DCE applicants already have achieved significant cost savings for Medicare, finding ways to save even more would be extremely difficult if such applicants are compared only to their own past performance.”
The association recommended that the benchmarking methodology also include annual updates and a three percent maximum discount.
Additionally, CMS should “apply a robust risk adjustment methodology to DCEs’ benchmarks to ensure this model option does not inappropriately penalize participants treating the sickest, most complicated and most vulnerable patients,” the AHA advised.
Date: June 03, 2019