The Centers for Medicare and Medicaid Services (CMS) have set ambitions goals for the adoption of value-based alternative payment models (APM) by providers treating the beneficiaries of the Medicare and Medicaid programs. By 2030, Medicare seeks to have 100% of payments tied to quality and value through the adoption of two-sided risk APMs. Success in hitting this target in contingent upon Medicare developing reimbursement models that practices of all sizes and markets can adopt.
Given the potential opportunity to reduce costly utilization and improve the health of a broad range of patients, primary care has been the focus of many initial forays into APMs. To date, many of the value-based reimbursement models developed by Medicare and its Center for Medicare & Medicaid Innovation (CMMI) have required sophisticated infrastructure for the purpose of maximizing at-risk reimbursement. For primary care organizations that treat patients of all ages, the investment and infrastructure needed for these models may not apply to their patients covered by commercial and other governmental insurers.
In recognition of Medicare’s ambitious goals for APMs and the lessons learned from prior value-based primary care models (e.g., Comprehensive Primary Care Plus and Primary Care First), CMMI has developed the Making Care Primary model (MCP). MCP attempts to synthesize the strongest components of prior primary care innovation models, while allowing participation from primary care practices, regardless of their degree of sophistication with value-based care. The primary goals of the MCP are comprehensive primary care that advances health equity, coordinated care that facilitates care transitions and specialist consultation, and a flexible value-based reimbursement structure designed to assist practices in transitioning to capitation. Furthermore, MCP seeks to achieve multi-payer alignment through collaboration with state Medicaid agencies and commercial payors. As a result, the model is accepting applicants from only 8 states: Colorado, Massachusetts, Minnesota, New Mexico, New Jersey, New York, North Carolina, and Washington.
This article summarizes the financial model that MCP will use to on-ramp primary care organizations to succeed in value-based care and APMs, while highlighting the types of organizations that stand to benefit most from the model.
Financing the On-Ramp to Value-Based Care
MCP promotes an on-ramp to value-based care by gradually transitioning primary care organizations from fee-for-service (FFS) to capitated per beneficiary per month (PBPM) reimbursement for professional services. Concurrently, MCP provides primary care organizations with front-loaded support payments to finance the infrastructure needed for coordinated population health management; organizations are incentivized to make the best use of these investments through increasing levels of upside-only, at-risk quality bonuses. MCP’s reimbursement model is driven by three “Tracks,” corresponding to increasing degrees of at-risk reimbursement. Primary care organizations are able to enter the MCP model at any of the tracks based on their degree of readiness for risk-based reimbursement. Each organization will advance to the next Track after a few years, up to Track 3.
The bulk of reimbursement under the model pertains to the primary care professional services rendered by the participating clinicians. Roughly speaking, primary care organizations retain traditional fee-for-service (FFS) reimbursement in Track 1. Only organizations with low revenue, limited telehealth capabilities, and no experience in Medicare risk-based reimbursement models are eligible for Track 1. Starting with Track 2, organizations are reimbursed a Prospective Primary Care Payment (PPCP) that is based on a defined PBPM payment per attributed patient. In Track 2, roughly half of the professional services are reimbursed on a FFS basis, with the other half being comprised of the PPCP PBPM reimbursement. In Track 3, roughly all professional services will be reimbursed through the PPCP PBPM funds. The PPCP PBPM reimbursement amount will be based on an organization’s historical spending level.
Beyond increasing degrees of at-risk reimbursement for professional services, MCP introduces two additional types of payment: the Enhanced Services Payment (ESP) and Performance Incentive Payment (PIP). The ESP is intended to fund care management, patient navigation, connection to behavioral health, and other enhanced care coordination. It is a supplemental payment paid on a PBPM basis and is determined based on the clinical risk (using CMS-HCC) and social risk (using the Area Deprivation Index) scoring of each attributed beneficiary. It is important to note that fee-for service reimbursement for chronic care management services will be replaced by the ESP for MCP participants. The amount of the ESP decreases as organizations move up the Tracks to reflect the integration of new care management, patient navigation, behavioral health, and care coordination resources.
The table below, reproduced from the initial webinar presentation of the MCP model by CMMI, presents how the amount of the ESP PBPM is calculated by Track:
While the ESP decreases with each Track increase, primary care organizations become eligible for increasing upside-only, at-risk payments in the form of the PIP. The PIP is a quality incentive bonus calculated as a percentage of the sum of FFS and PPCP reimbursement amounts for attributed beneficiaries. To earn the bonus, primary care organization will need to exceed targets established for metrics across the following domains: managing chronic conditions, wellness and prevention, person-centered care, behavioral health, equity, and cost/utilization. The PIP maximum bonus starts at 3% of FFS revenue in Track 1, increases to 45% of FFS and PPCP reimbursement in Track 2, and caps out at 60% of PPCP reimbursement in Track 3.
The table below, reproduced from the initial webinar presentation of the MCP model by CMMI, presents the various quality performance measures that will be incorporated with the PIP:
To help smaller organizations with little to no experience in value-based reimbursement models, Track 1 participants that meet a low revenue threshold and that do not have an e-consult platform can receive Upfront Infrastructure Payments of $145,000 (spread in two equal installments over two years) to fund support staff, tools to address health-related social risks, and enhancements to electronic health / telemedicine capabilities.
CMS has identified coordination between primary care providers and specialists as a key area of weakness in existing reimbursement models. To encourage integration between these groups, participants will be eligible to receive the MCP E-Consult (MEC) payment starting in Track 2. The MEC payment is $40 and made to the MCP primary care provider for each electronic consultation held with a specialist in addressing a beneficiary’s health needs (CMMI is prioritizing consults with cardiology, pulmonology, and orthopedic specialists). Upon reaching Track 3, the historical utilization of this service will be incorporated into the revenue formula for the PPCP.
To facilitate specialist participation, MCP encourages participating organizations to enter into collaborative care agreements with specialists. Specialists in a collaborative care agreement with Track 3 MCP participants are eligible to receive an Ambulatory Co-Management (ACM) payment to support short-term specialized care to stabilize an exacerbated chronic condition. The ACM payment is $50 PBPM to the specialist for a time-limited period during which their services are needed to effectively manage the chronic condition.
Directing the Flow of Traffic to the On-Ramp: Ideal MCP Participants
As noted above, only primary care organizations in eight states are eligible to participate in the MCP model. Furthermore, rural health clinics, concierge medicine practices, grandfathered Tribal FQHCs and primary care organizations that were participating in CMMI’s models focused on primary care (e.g., ACO REACH and Primary Care First) as of May 31, 2023 are not eligible to participate in MCP. In addition, organizations currently participating in Medicare’s Shared Savings Program (MSSP) must opt-out that program if they wish to participate in MCP and receive the associated reimbursement. Despite this eligibility criteria, many organizations can stand to benefit greatly from participating in MCP. The figure below summarizes examples of ideal MCP participants, which are discussed in further detail in the remainder of this section.
First, organizations that meet the Track 1 criteria (low revenue, limited telehealth capabilities, and no prior value-based reimbursement experience) are able to gain access to $145,000 ($72,500 per year) in funding in the first two years to finance some of the resources needed to succeed in value-based care. The UIP provides a springboard for practices that historically could not afford the resources necessary for effective value-based care (e.g., sophisticated data reporting modules in electronic health records systems).
Aside from practices with limited resources for infrastructure investments, the ESP PBPM amount increases based on the clinical risk of attributed beneficiaries. The ESP amount doubles when comparing patients in the lowest clinical risk quartile versus those in the highest. As a result, primary practices with a high proportion of patients with chronic and other acute illnesses stand to benefit from the added financial support from the ESP. Further enhancing the ESP PBPM amount is the social risk score of attributed beneficiaries. For patients in both the top quartile of clinical risk AND top quartile of social risk (as measured through the Area Deprivation Index), organizations receive a fixed payment of $25 PBPM, in all Tracks (all other ESP PMPM amounts decrease as organizations increase Tracks). Therefore, primary care organizations located in service areas that have sick patients with severe social needs will see additional supplemental funds to assist in patient care.
The PPCP PMPM amount is determined based on the historical cost of care for attributed Medicare beneficiaries (note that the MCP model will rebase cost levels over time and will eventually account for geographic variations in the cost of care). To the extent actual costs fall below historical levels, Track 2 and Track 3 organizations stand to realize 100% of savings, though they are at risk if cost exceeds benchmarks. As a result, primary care organizations with above-benchmark cost levels for treatment of their patient population stand to gain by improving the cost-efficiency of care.
Finally, the supplemental payments for specialist consultations and ongoing specialist co-management of patients benefit primary care organizations that have fostered deep relationships with community specialists. The providers of many primary care organizations already collaborate with community specialists; the prerequisite collaborative care agreements with the specialists are a low barrier to entry to facilitate payment to both primary care providers and specialists.
