CMS Unveils New Geographic Direct Contracting Model
On Dec. 3, officials at the federal Centers for Medicare & Medicaid Services (CMS) unveiled a new model for direct contracting called the “Geographic Direct Contracting Model. A press release published to the agency’s website on Thursday morning, began thus: “Today, the Centers for Medicare & Medicaid Services announced a new and transformative voluntary payment model that builds on CMS’ focus to deliver Medicare beneficiaries value through better care and improved quality. The Geographic Direct Contracting Model (the “Model”) will test an approach to improving health outcomes and reducing the cost of care for Medicare beneficiaries in multiple regions and communities across the country. Through the model, participants will take responsibility for beneficiaries’ health outcomes, giving participants a direct incentive to improve care across entire geographic regions. Within each region, organizations with experience in risk-sharing arrangements and population health will partner with health care providers and community organizations to better coordinate care.”
The press release noted that “Beneficiaries in the model will maintain all of their existing Original Medicare benefits, including the ability to see any provider they choose. Beneficiaries may also receive enhanced benefits, including additional telehealth services, easier access to home care, access to skilled nursing care without having to stay in a hospital for three days, and concurrent hospice and curative care. Participants will also have the ability to reduce beneficiary cost sharing for Medicare Part A and Part B services as well as offer beneficiaries a Part B premium subsidy. Lower out-of-pocket costs will allow participants to encourage beneficiaries to seek high-value care while maintaining the freedom and choice beneficiaries have in the Original Medicare program. While providers and participants may choose to voluntarily enter into value-based arrangements, the Model will not change how Medicare-enrolled providers care for beneficiaries in Original Medicare today.”
The press release quoted CMS Administrator Seema Verma as stating that “The need to strengthen the Medicare program by moving to a system that aligns financial incentives to pay for keeping people healthy has long been a priority. This model allows participating entities to build integrated relationships with healthcare providers and invest in population health in a region to better coordinate care, improve quality, and lower the cost of care for Medicare beneficiaries in a community.”
And, the press release noted, “Participants will work within defined geographic regions to maintain and improve care coordination, leveraging beneficiaries’ existing provider relationships as well as developing innovative care delivery solutions that take into account a region’s unique, local needs. Specifically, Model participants will coordinate care and clinical management for beneficiaries in Original Medicare in their region. This coordination may include care management services, telemedicine, as well as help for beneficiaries to understand which providers have a history of delivering better results and lower costs over the long-term. Beneficiaries in the model will remain in Original Medicare and maintain all of their benefits and coverage rights.”
What’s more, “Beneficiaries will also keep all of the protections of Original Medicare, including access to all Medicare providers and suppliers, the freedom to choose and change providers at any time, and a strong appeals and Ombudsman system. To help with delivering improved outcomes, participants may create a network of preferred providers, armed with the Model’s enhanced flexibilities to provide the right care for beneficiaries at a lower cost. Participants and preferred providers may choose to enter into alternative payment arrangements, including prospective capitation and other value-based arrangements. Participants will also work to augment Medicare’s current program integrity efforts, reducing fraud, waste, and abuse in their region and decreasing costs for beneficiaries and taxpayers.”
Brad Smith, Director of the Center for Medicare & Medicaid Innovation (CMMI), said in a statement contained in the press release that “The Geographic Direct Contracting Model is part of the Innovation Center’s suite of Direct Contracting models and is one of the Center’s largest bets to date on value-based care,” said CMMI Director Brad Smith. “The model offers participants enhanced flexibilities and tools to improve care for Medicare beneficiaries across an entire region while giving beneficiaries enhanced benefits and the possibility of lower out-of-pocket costs. By initially testing the model in a small number of geographies, we will be able to thoughtfully learn how these flexibilities are able to impact quality and costs.”
The Request for Applications will be made available in January 2021, and Applications will be due on April 2, 2021. Model Participants will be selected by June 30, 2021. The first three-year performance period will run from January 1, 2022 through December 31, 2024. A second three-year performance period will run from January 1, 2025 through December 31, 2027.
The fact sheet on the program can be found here.
The Los Angeles-based America’s Physician Groups (APG) issued a statement on Thursday praising the creation of the new program. “The America’s Physician Groups (APG) applauds the Centers for Medicare & Medicaid Innovation Center (CMMI) today for initiating the Geographic Direct Contracting Model (Geo),” the statement said. And it quoted Don Crane, APG president and CEO, as stating that “The value-based care community welcomes this new payment and care delivery model. Models of care that are focused on systems of reimbursement such as capitation and holding physicians accountable for cost, coordination, and quality are integral to moving away from the fee-for-service model and toward more transformative models of care that reward value while accounting for improved population health, quality, and the patient experience.”
Further, the APG statement said, “This new model is reflective of the shared goals between CMMI and APG as our member organizations have dedicated substantial investments and planning in preparation for the transformation of the nation’s healthcare system from focusing on volume toward value-based care. Geo ensures that moving forward, more models will account for quality of care for patients while encouraging providers and organizations to take on risk.”
