Cancellation of bundled-payment models reflects White House's stance on value-based care

The Trump administration's moves to cancel two mandatory bundled-payment models and scale back on another means the CMS has to work hard to push providers into value-based care, experts say.

On Tuesday, the CMS cut the number of locations mandated to participate in the Comprehensive Care for Joint Replacement, or CJR, model from 67 to 34. It also canceled Episode Payment Models and the Cardiac Rehabilitation incentive payment models that were supposed to begin on Jan. 1, 2018.

The agency said the rules were too burdensome to providers. But some experts worry that might give off the wrong impression.

"There are going to be a lot of physicians out there who think they are getting a pass," said Dr. John Bulger, chief medical officer for Geisinger Health Plan, which concentrates on value-based care. Bulger wonders if enough providers will be attracted to voluntary models to create a "tipping point" that moves Medicare away from fee-for service.

Robert Seehausen Jr, senior vice president of business development and sales at Novant Health, a multi-state health system with 15 hospitals said he was skeptical that voluntary models will move the needle enough. He says he's seen the benefit that the mandatory CJR model has had in bettering patient experience.

Sabra Rosener, vice president and government relations officer at UnityPoint Health, a multi-health system with 32 hospitals had mixed feelings about Tuesday's announcement. Her system wasn't quite ready to launch the new cardiac models, she said.

"But then we thought what does this mean for value-based payments especially now that Patrick Conway is gone," Rosener said. Conway was the director of the CMS' Center for Medicare and Medicaid Innovation, which creates and pilots new payment models. The center has been in the crosshairs of HHS Secretary Tom Price, who slammed the mandatory aspect of models introduced during the Obama administration.

Conway, who was a major advocate of value-based care, last week announced he was exiting the agency to become CEO of Blue Cross and Blue Shield of North Carolina.

The CMS' decision to cancel EPM and CR models without offering even voluntary alternatives to replace them could be viewed as preference for fee-for service, according to Blair Childs, senior vice president of public affairs at consulting firm Premier.

Over the past few months, the CMS has insisted it was scaling back CJR and canceling the cardiac pay models with the aim of attracting more providers to participate.

Remedy Partners, a company that helps hospitals and physicians with bundled-payment programs doesn't view the rule as a warning that value-based pay will go away given that there's too much evidence that voluntary models like ACOs are starting to generate savings.

Doctors working under fee-for-service models often bill for many expensive but unnecessary services that don't necessarily result in better care.

Eventually even without mandatory pay models, providers will still move to value-based care eventually as patients attracted to hospitals that offer the highest quality of care, according to Christopher Garcia, CEO of Remedy Partners.

The CMS now needs to work to ensure there are adequate incentives to get enough providers on board with voluntary models. One way to do this is to ensure that the models will count as participating under MACRA, Bulger said.

The structure of pay models can also be administratively burdensome and they can be streamlined to make them easier to roll out. Each model often comes with rules that are hundreds of pages long.

"They are so administratively complex that you end up with more paper cuts than actually driving better care outcomes," said Elizabeth Kissick, vice president of payor relations and network development at University of Colorado Medicine, a multi-specialty academic practice with 2,400 providers.

The CMS should also put more focus on creating multi-payer models like Comprehensive Primary Care Plus, or CPC+, according to Trudi Matthews, Senior Policy Advisor at UK HealthCare, a multi-site system in Kentucky.

Under that model, the aim is to improve health outcomes and lower costs not only for Medicare beneficiaries but for consumers enrolled in commercial plans and other coverage options, such as insurer-managed Medicaid plans.

"If we're going to invest heavily in value base care we need to be paid differently by all our payors," Matthews said. "Otherwise you'll always have one foot in fee-for service."

The federal government has continue to see its Medicare costs rise. In 2016, Medicare covered 56.8 million people and expenditures were $678.7 billion up from $647.6 billion and 55.3 million beneficiaries in 2015. The Medicare Trust Fund is on track to run out of money in 2029.

An​ edited​ version​ of​ this​ story​ can​ also​ be​ found​ in​ Modern​ Healthcare's​ Aug.​ 21​ print​ edition.