Healthcare Alert

Last fall, the Centers for Medicare & Medicaid Services (CMS) announced a new direction for its Center for Medicare & Medicaid Innovation, CMS’s platform for testing innovative models for delivering high-quality care at lower costs. Following the announcement, CMS issued a request for information (RFI) to collect input from industry participants and stakeholders on how CMS should achieve its desired “shift away from a fee-for-service system that reimburses only on volume and move toward a system that holds providers accountable for outcomes and allows them to innovate.” The RFI provided eight guiding principles that focused on increasing competition and choice, as well as transparency and patient-centered care.

On April 23, 2018, CMS released a follow-up alert to the RFI, in which the agency announced that it had published all of the comments it received in order to further discussions on shaping new models of care and improving existing models. The comments, which came from a wide variety of industry stakeholders and totaled over 1,000, focused on areas relevant to decreasing costs and enhancing quality of care, such as improving patient choice, providing incentives to increase patient-centered care, broadening transparency, increasing physician accountability for patient outcomes, and care of chronically ill patients. CMS describes the comments as reflecting broad support for “reducing burdensome requirements and unnecessary regulations.”

In addition to releasing stakeholder comments, CMS issued a new RFI soliciting information on direct provider contracting (DPC) models that would operate within the Medicare fee-for-service system. Informed by the new direction RFI feedback and guided by new Secretary of Health and Human Services Alex Azar’s focus on using experimental models to drive quality and value, CMS is requesting data to “potentially design and release” a DPC model.

CMS’s stated goal for DPC models is to enhance quality of care, while reducing expenditures and eliminating unnecessary costs, by increasing access to physician services, decreasing administrative burdens related to billing, and affording providers a revenue stream with flexibility on how and where to care for patients. For example, under a primary care-focused DPC model, CMS could pay participating practices a fixed per beneficiary per month (PBPM) payment that would cover services the practice is expected to furnish under the model, such as office visits, certain office-based procedures, and other non-visit-based services covered under the Physician Fee Schedule, while allowing flexibility in how other billable services are delivered. In addition to the PBPM payments, practices could also earn performance-based incentives for total cost of care and achievement of quality targets.

CMS is particularly interested in feedback from stakeholders regarding any gaps that potential DPC models could fill and those that would strengthen current CMS initiatives. CMS is also interested in models that show how states may include DPC arrangements in their respective Medicaid programs. The deadline for comments is May 25, 2018.