MedPAC: streamlining alternative payment models

As hospices explore greater participation in alternative payment models, the Medicare Payment Advisory Commission (MedPAC) is urging Congress to scale back and restructure these programs.

Palliative care providers are eyeing the emergence of APM for the Center for Medicare & Medicaid Innovation (CMMI). These models represent an entry point to value-based reimbursement, as well as a means to support additional lines of business such as palliative care, PACE and other services.

MedPAC originally called on Congress and the CMMI to streamline these models in its June 2021 report. This year, the commission has describe specific strategies to execute its recommendation.

“APMs typically give healthcare provider organizations a financial incentive to provide a more efficient mix of services and improve the care they deliver,” the new report says. “The presence of multiple APMs operating simultaneously can create unnecessary complexity and can dilute incentives when Medicare beneficiaries are assigned to more than one model simultaneously and/or when providers participate in more than one APM at the same time.”

A wide range of healthcare payment and delivery systems can fall under the APM designation. A common principle is the concept of population-based reimbursement.

In this approach, a health care provider agrees to accept responsibility for a group of patients in exchange for a predetermined amount, usually with incentives to reduce costs and improve quality.

Examples of APM or related demonstrations include the Value-Based Insurance Design Demonstration (VBID), the ACO Realizing Equity, Access, and Community Health (REACH) model, the Medicare Shared Savings program, and the Medicare Care model choices.

MedPAC recommends reducing the number of ACO model leads, of which seven currently exist. The remaining leads could be redirected around providers of various sizes and involving different levels of financial risk.

“It is important to ensure that providers have a strong incentive to participate in CPAs. Recognizing that not all providers are able to bear financial risk under population-based payment models, the Commission does not see a rapid transition to mandatory participation in ACOs as a practice,” MedPAC wrote in its report. . “However, we encourage CMS to explore ways to strengthen incentives to participate in population-based payment models, particularly for large provider organizations.”

The commission’s recommendations included a number of provisions for ACO agreements, including the abandonment of periodic rebasing of spending benchmarks informed by the actual spending of these organizations. Instead, the commission proposed using a specific growth factor to rebase the payouts.

This would ensure that ACOs that are successful in reducing their spending are not penalized in subsequent years by seeing their benchmarks “lowered”. MedPAC also recommended a nationwide, Medicare-operated payment-per-episode model that would be mandatory for some providers.

While the US Centers for Medicare & Medicaid Services (CMS) has yet to comment on the report, the CMMI has already expressed interest in streamlining its models.

CMMI announced last October a “strategy update” that would guide the development of its future payment models.

The center indicated in a document outlining its new strategy that the complexity of payment policies and the overlap between payment models can sometimes result in conflicting or opposing incentives for healthcare providers.

One of the objectives is to stimulate the expansion of responsible care and increase the number of beneficiaries in relation to these entities.

These could include physician group practices, Medicare Advantage plans, Accountable Care Organizations (ACOs), or PACE programs, among many others. In 2020, 67% of Medicare beneficiaries enrolled in Parts A and B were in MA plans or were assigned to an ACO, according to the CMMI.

“Accountable care is about giving all participating providers the incentives and tools to provide high-quality, coordinated, team-based care that promotes health, thereby reducing fragmentation and costs to people and the system. healthcare,” the CMMI said in the document.

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