CMS Takes Aim at Medicare Costs With CPC+

September 3, 2019

Since 2008, the Centers for Medicare & Medicaid Services (CMS) has introduced no fewer than thirteen major initiatives to wean the U.S. healthcare system off fee-for-service (FFS) payments to value-based payment models (VBP). FFS compensates hospitals and doctors for each uncoordinated episode of care, ranging from blood and imaging tests to surgery. In effect, the more care providers give, the more they get paid.

The FFS model has long been cited as one of the reasons the U.S. has the most expensive per capita healthcare costs in the developed world. These costs tallied $3.65 trillion in 2018 – or about $11,212 per person and about 18 percent of GDP. This represented a 4.4 percent increase in just one year between 2017 to 2018. Such cost increases are unsustainable.

Healthcare delivery reform has historically come through CMS initiatives, ranging from the 30-day readmission program to bundled payments for orthopedic surgery. As the largest payer for healthcare in the U.S., CMS mission to lower costs (tax dollars) and improve outcomes makes sense. Also, as private insurance often adopts such delivery changes, any success by CMS to reduce costs and improve outcomes has significant ripple effects.

The most recent effort launched by CMS is the latest rendition of its delivery and payment model known as the Comprehensive Primary Care Initiative, or CPC+, in lowering Medicare costs. In short, CMS wants to pay primary care physicians a monthly fee to take care of as many as 25 million Medicare patients. CMS intends to further build on an earlier version of the CPC+ model to strengthen the use of and reliance of primary care physicians to coordinate whole-person care medical delivery as a way to control costs and improve results.

The earlier version of the model, often referred to as CPI, was rolled out in seven geographic regions at nearly 500 clinical sites. CPI did achieve some promising, but not overwhelming results between the rollout of 2012 through 2017. These included: reducing hospitalization and emergency room visits for Medicare beneficiaries; a savings in Medicare member expenditures for health services; and satisfaction by physicians/staff with the delivery model (key to avoiding doctor burnout) to improve care. However, CPI had little impact on patients’ experience of care or claims-based quality-of-care outcomes measurements.

Despite the limited result, the CPC+ Initiative will move ahead to improve upon the CPI results – and with good reason. Despite the efforts of CMS to move away from FFS over the past decade-plus, it’s estimated that between 68 percent and 95 percent of healthcare is still delivered under the costly FFS model. Under CPC+, the original seven same geographic regions can build on their CPI success by:

1: Focusing on care for patients with high care needs. Patients with serious or multiple medical conditions need more support to ensure they are getting the medical care and medications they need. Participating primary care practices will deliver intensive care management for these patients with high needs.

2: Providing 24-hour primary physician access and care beyond office hours. Part of this standard also includes primary care physicians having access to patient information around the clock.

3: Delivering preventive care. Primary care practices will be able to proactively assess their patients to determine their needs and provide appropriate and timely preventive care.

4: Engaging Patients and Caregivers. Primary care practices will have the ability to engage patients and their families in active participation in their care.

5: Coordinate Care Across the Medical Neighborhood. Under this initiative, primary care doctors and nurses will work together and with a patient’s other health care providers and the patient to make decisions as a team.

Early indicators are that CMS will look to adopt 25 CPC+ quality outcomes measures at the geographic market regions, rather than individual primary care physicians’ practices. According to Dr. Andrei Gonzales, AVP Product Management for Value-Based Payments, CPC+ is promising in advancing the whole person care concept to achieve CMS goals.

“This initiative is a very strong move forward in the progression to value-based care from fee-for-service or fee-for-volume system,” said Gonzales. “As we look at value-based care, it’s important to really understand how to ensure value-based care, not just from a payment perspective but really from a clinical transformation point-of-view. These models start to put primary care back in the driver’s seat for really the creation of health for all of us as patients.”

Of course, as with any new initiative, there are possible challenges and pitfalls. While most practices found that CPI did improve quality of care, many practices found meeting the care delivery, financial reporting, and health IT requirements burdensome. Also, the willingness of practices to sign up for CPC+ in the seven regions remains unknown. And CPC+, unlike other CMS outcomes programs, is not paying for results per other CMS alternative payment models. CPC+ will pay providers based on how much they save Medicare under the accepted principle that better coordinated care does reduce healthcare costs. As such, the majority of dollars – less some prospective performance compensation – is guaranteed to primary care physician participants.

According to Dr. Gonzales, CPC+ allows primary care providers the opportunity to oversee all the Medicare patients in their region. This includes considering solutions to Social Determinants of Health (SDOH), such as providing air conditioning and carpet cleaning to Medicare patients who suffer from pulmonary illnesses. He thinks CPI+ has much to offer.

“At this point the program has…cautious enthusiasm from the association of AFP, the Family Practitioners Association, from the American Medical Association. These organizations are looking at the programs and recognizing some of the significant changes that Medicare is making in terms of how they are paid for care and some of the administrative requirements,” said Gonzales. “So, just that alone should reduce the overall cost of care for Medicare patients.”