CMS: Centers for Medicare & Medicare Services, Navigating Innovative Models in 2017
Now that Rep. Tom Price has been confirmed for Health and Human Services (HHS) Secretary, he can halt some of the agency’s mandatory programs, such as the Comprehensive Joint Replacement (CJR) model. However, value-based models will likely remain part of the national strategy moving forward since they are promoted by payers, private insurers, and Medicare.
As the industry spins through a cycle of payment experimentation, providers assume more risk for outcomes and collaboration between health plans, physicians, and hospitals becomes increasingly important.
If, as suspected, states are granted more flexibility to operate their Medicaid programs, methodologies that emphasize population health are likely safest. Under the seven Center for Medicare and Medicaid Innovation (CMMI) categories, healthcare organizations can find attractive options around areas that best exemplify their care models.
There are over 70 CMS payment methodology options for institutions to work through that can have a positive impact on an organization’s clinical and financial performance. Since physicians are tied so closely to the success or failure of hospitals and health systems given the amount of consolidation that has taken place, the decision about which methodologies to adopt could prove crucial. Of the seven categories of the Innovation Center’s Models, those that have the greatest promise for 2017 include:
• Accountable care
• Episode-based Payment Initiatives
• Primary Care Transformation
• Bundled Payment Initiatives
Additionally, models with little or no downside risk are attractive for organizations with limited experience managing risk-based payments.
“When facing an active participation decision, such as selecting among the different ACO models, organizations balance a host of near-term financial and long-term strategic considerations,” said Rob Lazerow, managing director, healthcare advisory board research program of The Advisory Board. “The first thing to keep in mind is that organizations need to make these decisions based on their current experience to date managing risk-based payment, particularly in problematic area populations. We think focusing on two elements, the financial target and the balance of risk and reward, helps organizations figure out what the right models are for them and their experience level.”
Advisory Board surveys over the past year show that those who have participated in value-based care the longest are the most successful—both in financial and clinical outcomes.
“Health care providers are navigating a host of new payment programs from CMS and CMMI,” Lazerow said. “In some cases, organizations don’t have an active choice to make since they could be in one of the markets selected for mandatory orthopedic or cardiac bundles, or they could be in a region that’s not currently eligible for a multi-payer program, such as Comprehensive Primary Care Initiative Plus. I think we’ll continue to see organizations apply for programs, particularly ones like Medicare Shared Savings Track One that don’t have downside risk.”
Chad Mulvany, director, healthcare finance policy, strategy and development, Healthcare Financial Management Association (HFMA), suggests looking for opportunities and models that involve specialists. “For instance, maybe look at what they’re doing in Arkansas with their episodic payment program and their primary care medical programs,” said Mulvany. “In those models, they are pushing some degree of risk down to the physician, and these obviously, by and large, aren’t large practices due to the makeup of the different markets in Arkansas.”
“It can be very market specific as to which model is right for a particular organization,” said Danielle Lloyd, vice-president, policy, and advocacy, Premier Inc. “We do believe for those organizations just embarking on the population health journey that the Medicare Shared Savings Program Track 1 can be beneficial in allowing organizations to build their foundations and prepare for risk-based models in the future.”
Mulvany seconds the importance of taking stock of local employers and the needs of their employees. “I would think about my broader strategy and what I’m trying to do with the commercial sector,” said Mulvany. “How impressive are the employers in your market? We continue to hear from our members and also health plans that they are continuing to move lives into accountable care structures.”