A large survey of most commercial plans has found that 23 percent of their spending is through advanced APMs.


Oct. 25—Medicare announced new measures this week to expand payer and provider participation in advanced alternative payment models (APMs) in 2017 and 2018.

The Centers for Medicare & Medicaid Services (CMS) will reopen applications for new practices and payers in the Comprehensive Primary Care Plus (CPC+) model and for new participants in the Next Generation Accountable Care Organization (ACO) model for the 2018 performance year.

Additionally, clinicians in the Oncology Care Model (OCM) with two-sided risk in 2017 will qualify as participants in an advanced APM under the Medicare and CHIP Reauthorization Act of 2015 (MACRA); the two-sided risk track previously was not scheduled to be available until 2018.

CMS launched the OCM in July with nearly 200 physician group practices and 17 payers joining the five-year pilot, which provides financial incentives for practices to improve care coordination and reduce the total cost of chemotherapy treatment episodes.

Under MACRA, clinicians can earn a 5 percent incentive payment if they sufficiently participate in an advanced APM.

After the latest tweak to MACRA, clinicians will be able to earn the APM bonus—while avoiding quality-reporting requirements otherwise required by MACRA’s Quality Improvement Program (QIP)—if they join the following models for 2017:

  • Comprehensive ESRD Care Model (Large Dialysis Organization [LDO] arrangement)
  • Comprehensive ESRD Care Model (non-LDO arrangement)
  • CPC+
  • Medicare Shared Savings Program (MSSP) Track 2
  • MSSP Track 3
  • Next Generation ACO Model
  • OCM with two-sided risk

Qualifying APMs will expand by 2018 to include these models:

  • MSSP ACO Track 1+
  • New voluntary bundled payment model
  • Comprehensive Care for Joint Replacement payment model (Certified Electronic Health Record Technology [CEHRT] track)
  • Advancing Care Coordination Through Episode Payment Models Track 1 (CEHRT track)

The lists of qualifying APMs is expected to continue to grow, CMS said in a release. Up to 120,000 clinicians were expected to qualify for the advanced APM track in 2017, with that total increasing to “more than” 125,000 in 2018, according to CMS.

“This means that by 2018 clinicians will have a total of 10 models from the [CMS] Innovation Center to choose from as they transition” from the QIP to the APM track, U.S. Department of Health and Human Services (HHS) Secretary Sylvia Mathews Burwell said when announcing the APM expansion.

Burwell noted the healthcare industry has reached her goal of tying 30 percent of payments to APMs by the end of 2016. HHS is now working toward shifting at least 50 percent of payments into APMs by the end of 2018.

Medicaid Model

The announced expansion of the APM program came amid concern that the final MACRA rules excluded most Medicaid medical home model as a qualifying advanced APM. In the earlier proposed rule for MACRA, CMS said it was considering including those models.

Some health policy experts said CMS may reconsider that decision in the future.

“They might revisit, or there might be some further refinements as we learn what’s working in the medical home models, regarding how they are implemented, and with the effect of more [clinicians] qualifying for the bonus payment,” said Mark McClellan, a former CMS administrator and currently a director with the Brookings Institution.

McClellan noted that medical homes vary widely as care delivery models and can include a range of design features that make participating providers either more or less accountable. And CMS is pressing for medical homes to add more advanced elements, such as making providers responsible for the delivery of a range of primary care services.

“With the work that has gone on so far and the work that is continuing, there will be more and more opportunities for Medicaid payment models and commercial payment models to qualify for that advanced APM status,” McClellan said in an interview. “It’s a journey.”

The significance of MACRA‘s omission of such medical home models as designated APMs largely depends on how Medicaid physicians are organized, said Mark Smith, clinical professor of Medicine at the University of California at San Francisco and co-chair of the Health Care Payment Learning & Action Network’s (LAN’s) Guiding Committee. The decision could mean a lot more in locales where higher numbers of Medicaid outpatient providers are in small practices, compared to those where most are employed through federally qualified health centers.

“I suspect if it turns out to be problematic, it may turn out to be one of the things that has to be addressed” by CMS, Smith said in an interview. “I’m not sure we know yet.”

Commercial Efforts

The announced expansion of APM options through MACRA came on the same day commercial payers in LAN, a public-private partnership that aims to expand the use of APMs, revealed the extent of such expansion efforts. Seventy commercial payers and two Medicaid plans in LAN, which cover 67 percent of the nation’s 208 million commercially insured beneficiaries, revealed that 23 percent of their total spending was through APMs as of January. In comparison, 62 percent of spending was through straight fee-for-service (FFS) and 15 percent was FFS with some kind of link to quality or value.

“My sense is that we’re steadily increasing if not accelerating [the use of APMs], but it’s really hard to know because there hasn’t been a baseline,” said McClellan, the other co-chair of the LAN Guiding Committee. “That’s why this was such an important, unprecedented survey.”

Burwell noted that beginning in 2019, MACRA will give providers credit for participating in Medicaid and commercial APMs.

“We now appreciate that many of you will be the first to offer clinicians the opportunity to participate in advanced APMs in Medicaid and the commercial market,” Burwell said at a LAN event.

The commercial plan release followed recent concerns raised by a prominent organization of not-for-profit health plans that CMS might make advanced APMs so stringent under MACRA that they limit provider participation in private payment reforms.

Among plans surveyed, Medicare Advantage (MA) plans showed the most widespread adoption of APMs, according to an LAN report. Specifically, 41 percent of MA plan spending was in either APMs built on an FFS structure or population health models, compared with only 22 percent of commercial health plan spending and 18 percent of Medicaid healthcare spending.

“Over the longer term, one of the main goals of this effort is to get more alignment between what is happening in Medicare, Medicaid, and commercial payment,” McClellan said. “One of the things that will come out of this effort is a clear understanding of how those different models are being adopted and what forms really are leading to improvements in outcomes and reductions in cost.”


Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Tuesday, October 25, 2016