The CMS Innovation Center’s massive Comprehensive Primary Care initiative appeared to break even its first year, but there is concern that a planned reduction in its care-management fee this year could impede the fragile momentum it has built.
The program was launched in October 2012 with 502 participating practices supported by Medicare and 31 other insurance plans based in seven regional areas.
An evaluation of the initiative's first year (PDF) found practices received $141.3 million from per-member per-month care-management fees, and that—as of December 2013—492 practices were still engaged in the effort as were 29 of the original payers. The initiative, which runs through 2017, seeks to test the clinical benefits and financial sustainability of medical-home practices that provide enhanced patient access and continuity of care, planned chronic and preventive care, risk-stratified care management, patient and caregiver engagement, and coordination of care across a “medical neighborhood.”
Approximately 2.5 million patients were cared for in the program’s first year, with Medicare contributing $90.5 million in care-management fees toward the effort. Early calculations suggest a 2% monthly savings in Part A and Part B fee-for-service expenditures, according to the report, which was written by a team from Princeton, N.J.-based Mathematica Policy Research and Group Health Research Institute in Seattle.
“While CPC is not a medical home-certification initiative, it shares many of the goals of improving primary-care performance,” the Mathematica researchers wrote, adding that 23 of the 29 participating health plans had experience implementing medical home initiatives.
The CMS selected the seven participating regions in April 2012 based on payer interest and geographic diversity. Those chosen were four states (Arkansas, Colorado, New Jersey and Oregon) and portions of four others (New York’s Capital District-Hudson Valley region, Ohio and Kentucky’s Cincinnati-Dayton region and Oklahoma’s Greater Tulsa region).
Medicare paid practices a monthly risk-adjusted per-patient management fee of $8, $11, $21 or $40. The bulk went toward managing the care of high-risk patients. In all, it paid $45 million in fees for high-risk patients, $23 million for those considered medium-high risk, $14 million for medium-low risk patients, and $8 million for low-risk patients.
Only nine private plans were risk-adjusting their fees and their payments were “generally substantially less than what Medicare provides,” according to the reports. But the covered patients were generally younger and lower risk. Susan Stuard, executive director of New York’s Taconic Health Information Network and Community (THINC), said the management fees paid by private companies could not be publicly disseminated because of antitrust issues.
Early results suggested that the 2% savings were derived from a 2% decrease in hospitalizations and a 3% decrease in emergency utilization. The report downplayed these findings and stated that “the few statistically significant findings showed no clear pattern.”
The modest savings appeared to be driven mainly by significant early success in Oklahoma, which—after accounting for the care-management fee—registered monthly savings of 5% or $41 a month per patient. But Tulsa practices also had early declines in quality measures such as administering all of four diabetes-related exams to patients and providing a follow-up visit within 14 days after a hospitalization.
“Results should be interpreted cautiously as effects are emerging earlier than anticipated, and additional research is needed to assess how the initiative affects cost and quality of care, beyond the first year,” Dr. Patrick Conway, CMS chief medical officer and deputy administrator for innovation and quality, wrote in a blog post. “Because the effects of the CPC program are likely to be larger in subsequent years, these early results are consistent with the possibility that the model will eventually break-even or generate savings.”
Dr. Robert Wergin, president of the American Academy of Family Physicians, said it’s been the experience of his organization that it usually takes 18 to 24 months before the transition to the medical home practice model shows tangible benefits.
“It takes a while to get the infrastructure set up,” Wergin said. He added, however, that he was pleased to see practices using the care-management fee to cover those infrastructure expenses.
The median total in care-management fees participating practices received was $227,849. The Cincinnati-Dayton region was at the high end, with practices getting a median $377,000 from Medicare and about $113,000 per “clinician,” a term that included doctors, nurse practitioners and physician assistants. On the low end, Tulsa practices received a median amount of $176,000 and Oregon clinicians received a median total of $35,000. (There were 2,158 clinicians participating as of December 2013.)
From these fees, practices reported spending $28 million to pay for care managers, $20.6 million on population health-management resources, $15.97 million on health information technology, $13.95 million on building their interdisciplinary care team, and $7.48 million on staff training.
“These payments represent a substantial infusion of revenue,” the report stated. Starting this year, however, Medicare management fees would be reduced down to an average of $15. A shared savings element will be added but the report noted concern from some practices “about their ability to sustain practice change” when the monthly fees decrease.
About 1,000 practices applied to participate, including many who already belonged to THINC, which includes the Taconic Independent Practice Association and other regional stakeholders seeking to improve healthcare quality and lower costs in the Hudson Valley region.
In New York, Stuard said, “Practice A will not know how Practice B is doing on performance and utilization measures,” but shared savings are being calculated on a market level rather than a practice level. So practices are concerned that they are getting a smaller fee and that the size of their possible shared-savings payment will be based on factors beyond their control.
The report also included candid evaluations of how the CMS was faring in its dual role as both a convener of the CPC participants and as a participant itself. Health plans “generally valued CMS participation,” but many characterized their relationship with the agency as “bumpy.” Frustrations included surprise at “top-down directives,” bureaucratic or contract limitations that were not in the control of CMS staff involved in the project, CMS staff turnover, and having CMS staff attend meetings by telephone rather than being physically present.
The report also stated that “data aggregation has proven challenging” among plans.
“The great majority of measures being used to determine shared savings come directly out of the electronic health record,” Stuard said. “I think it’s been challenging for some practices and EHR vendors to stay up with and meet all of the needs CPC has for utilization of the EHR data.”
Wergin, however, said he was involved in am independent practice association with six practices in rural Nebraska in which all six had different EHRs “that didn’t talk to each other.” They were able to find a common vendor able to provide data extraction service for four of the six. “You have to be innovative,” he said.
Wergin added that he recently visited participating practices in Arkansas and Colorado and the family doctors there were generally upbeat about the CPC program.
“I heard a sense of optimism,” Wergin said. “In general, they thought this would work.”
Follow Andis Robeznieks on Twitter: @MHARobeznieks