Value Based Payment Models Update

Value-based care continues to be a focus in the news this week, as the Centers for Medicare and Medicaid Services Administrator Seema Verma penned an op-ed in Modern Healthcare about the Centers’ support for models driven by the Center for Medicare and Medicaid Innovation. These programs have on the whole lost more money than they’ve saved CMS, so the changes ahead are going to be bumpy for current and future participants.

CMS Administrator Seema Verma,

The coming adjustments will at times upset the status quo, but we should remind ourselves Americans deserve a healthcare system that rewards providers for keeping them healthy.

According to Medical Economics, health leaders are pushing back on the initiative by CMS to require participation in Medicare alternative payment models. The Medical Group Management Association ran a stat poll asking healthcare leaders about mandatory participation and a clear majority, 76%, said they would prefer flexibility. From Anders Gilberg, senior vice president of government affairs for MGMA:

It is wrong to assume all group practices across the country can succeed in and benefit from the same payment model. Rather than rely on a government mandate to increase participation in APMs, CMS should focus on broadening the scope of models being tested, providing appropriate incentives, offering sufficient support and leveraging input from physicians and group practices.

Hospices are a notable exception to the rule of group practices mentioned by Gilberg. An article from Hospice News elucidates how hospices struggle to negotiate and demonstrate their value for managed care payers. Hospices will be included in the Medicare Advantage carve-in for 2021, called the Value Based Insurance Design Model Hospice Demonstration.

From Michael Puskiarich, director of advisory services for McBee Associates at a presentation at the National Association for Home Health & Hospice annual conference:

As we transition in our healthcare community away from fee for service into managed care, we’re seeing increasingly thin margins. As Medicare reimbursement continues to go down, we need to pay attention to those contract terms that we in the past have not paid so much attention to… You need to be reflective on what your agency looks like. Are you prepared to make the changes?

Pharmacists and pharmacies will doubtless be integral to the overall success of value based care payment models according to an AJMC article last week. During the Academy of Managed Care Pharmacy Conference this year, the questions of sustainability and bending cost curves away from fee-for-service and towards VBC will be of the utmost importance.

But CMMI is looking forward. In creating the Direct Contracting Model, the Center hopes to create more opportunities for large, diversified provider groups and health organizations. According to Vanessa Kuhn, director of health policy with PatientPing for HIT Consultant, the decision to grow from the accountable care initiative models like Next-Generation ACO or Medicare Advantage means that diverse groups can participate in high risk, high reward models under the Direct Contracting Entities model.

So while the controversy around value-based care payment models wages on, there’s still a lot to look forward to.

Read Administrator Verma in Modern Healthcare.