Physician Payment and Reimbursement

PTAC Recommends New Models Amid HHS Promises

September 11, 2018 9:00 am

One physician-focused model was recommended for full implementation, two for limited testing, and one for “attention.”

Sept. 10—Amid Medicare promises to soon introduce new physician-focused payment models, its leading advisory panel recently approved new models for consideration.

The Physician-Focused Payment Model Technical Advisory Committee (PTAC) met Sept. 6-7 and voted to recommend at least partial implementation of three physician-focused models to the U.S. Department of Health and Human Services (HHS). Those recommendations followed previous PTAC recommendations that HHS either implement or test on a limited scale 10 of 18 models that the committee has considered over nearly two years.

The 11-member panel recommended full implementation of the Acute Unscheduled Care Model (AUCM). The bundled payment model aims to “improve quality and reduce costs in Medicare by allowing emergency physicians to accept some financial risk for the decisions they make around discharges for certain episodes of acute unscheduled care,” wrote Paul Kivela, MD, president of the American College of Emergency Physicians (ACEP), which sponsored the model.

Following the committee’s approval, Kivela said in a written statement, “While this is a major step in the model’s development, we still have a long way to go before it’s operational. Today’s recommendation does not mean the model is approved by the Centers for Medicare & Medicaid Services [CMS]. ACEP looks forward to continue working with HHS to improve emergency patient care through the implementation of this model.”

The cautious optimism reflected the lack of implementation of any of the 10 models that PTAC previously recommended. HHS issued a response in June to those previously recommended models that essentially said “thank you very much, but no,” said Len Nichols, PhD, a PTAC member and a professor of Health Policy at George Mason University.

The lack of action prompted growing concerns from physician advocates that Medicare advanced alternative payment models (APMs) were unavailable to most physicians.

“It’s unambiguously true that stakeholders will give up on this avenue as a process” if no model is implemented soon, Nichols said in an interview.

The lack of options also is noteworthy because physicians are nearing the end of the second year in a five-year window to garner APM bonuses under Medicare’s revamped physician payment scheme.

Trump administration leaders recently have made a concerted effort to assure PTAC members and physician advocates that they will implement more such models—as soon as this calendar year.

“A number of the models advanced by PTAC have significantly influenced models we have in the works, but working with all of you, we want to go much further,” Alex Azar, secretary of HHS, said at PTAC’s Sept. 6 meeting.

The comments drew an optimistic response from PTAC members.

“We fear that stakeholders will not continue to participate in the PTAC process unless rapid progress is made in implementing the models they have proposed and we have recommended,” PTAC members said in a written statement. “Based on the comments made yesterday, we foresee hearing from both stakeholders and CMMI [the Center for Medicare & Medicaid Innovation] over the next several months that they are actively working together to finalize the designs of these models and that a plan for implementation of one or more models will be announced by the end of 2018.

Jeffrey Davis, director of regulatory affairs for ACEP, said his organization thinks PTAC’s recommendation of the AUCM “comes at the perfect time—when HHS’s new leadership has made it abundantly clear that models recommended by the PTAC will be strongly considered for adoption. We look forward to working with HHS and CMMI on the operational details of the AUCM.”

Other Recommendations

In addition, PTAC recommended limited-scale testing for a capitation model that uses patient-reported outcomes to improve primary care and a model for complex chronically ill patients who are frequently hospitalized.

The first model, from a small-practice primary care physician in Maine, aimed to provide a much more simplified option for practices than a modelfrom the American Academy of Family Physicians that PTAC previously approved. The second recently approved model, from the University of Chicago Medicine, aimed to expand a model that already had been funded by CMMI as a single-site pilot.

Some industry observers said they were surprised PTAC recommended testing those two models because they lacked support in preliminary reviews.

“There are some models that need much more development but can only be done by putting the model in place, but you want to do it on a small scale because you don’t have all of the details worked out,” Harold Miller, a PTAC member, said about the two models. “You could sit and analyze claims data until you are blue in the face, but you would never be able to figure out the information you need to be able to do these models.”

A fourth model, for home hemodialysis in skilled nursing facilities, was granted a new designation of “recommended for attention.”

The goal of the model, sponsored by Dialyze Direct, was “fundamentally desirable” but was not a particularly physician-focused payment model, said Miller, president and CEO of the Center for Healthcare Quality and Payment Reform. The model aimed to fund dialysis in nursing facilities rather than transporting patients by ambulance to dialysis centers.

“We didn’t think the particular approach to physician payment that they were proposing made any sense, but we thought the thing they were trying to accomplish needed to be helped,” Miller said in an interview.

Outlook for New Models

The primary challenge for the physician-focused models involves the logistics of implementing them and enrolling physicians—even if implementation decisions come quickly.

“Some of the ones that were implemented in the past took a long time even after they were officially announced to actually get money to flow to the people who were actually participating in them,” Miller said.

The five-year time limit on APM bonuses was established by statute, meaning the Trump administration cannot extend it through administrative action. But such bonuses are not the only reason physicians are interested in APM participation. In Miller’s view, the bonuses also serve to help practices cover the start-up costs of APM participation.

One administrative option that could provide additional financial assistance to APM participants is authorization for CMMI to exceed budget neutrality in payments to participants during a model’s early phase. Previous use of that authority produced the Accountable Care Organization Investment Model, which provided a repayable grant for start-up costs.

“The more different the model is, if you’re really expecting it’s going to change the way people practice, then the more time it’s going to take somebody to shift around that,” Miller said.  

Implementation of PTAC models could be spurred by reallocating CMMI funds from existing models that have not saved money or improved quality, Nichols said. A CMMI leader recently cited the lack of resources as a key limitation on new models.

“If you look at [the Comprehensive Primary Care Initiative], the results are at best disappointing; they didn’t save any money at all, they barely moved the quality metrics,” Nichols said. “For [Comprehensive Primary Care Plus], they basically took total cost of care out of the objective function and moved on. So that to me is declaring defeat and moving on.”

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


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