HHS launches five new primary care payment models

April 23, 2019

Known as the CMS Primary Cares Initiative, these models are intended to transform primary care to deliver better value for patients throughout the healthcare system.

The U.S. Department of Health and Human Services (HHS) announced five new payment models for primary care, known as the CMS Primary Cares Initiative. The initiative is intended to transform primary care to deliver better value for patients throughout the healthcare system, according to HHS Secretary Alex Azar.

“For years, policymakers have talked about building an American healthcare system that focuses on primary care, pays for value, and places the patient at the center,” Azar said in a news release. “These new models represent the biggest step ever taken toward that vision.” He added that the new models test paying for health and outcomes rather than procedures on a much larger scale than ever before. 

The five payment models are:

  • Primary Care First

  • Primary Care First – High Need Populations

  • Direct Contracting – Global

  • Direct Contracting – Professional

  • Direct Contracting – Geographic

The Primary Care First (PCF) models test whether financial risk and performance-based payments that reward primary care practitioners for easily understood, actionable outcomes will reduce Medicare expenditures, preserve or enhance quality of care, and improve health outcomes. 

The PCF models will provide payment to practices through a total monthly payment. There is also an option for practices that specialize in care for high need patients, including those with complex chronic conditions or seriously ill populations.

Both PCF models incentivize providers to reduce hospital utilization and total cost of care by rewarding doctors through performance-based payment adjustments. Key clinical measures will include controlling high blood pressure, managing diabetes mellitus, and screening for colorectal cancer. This model will be tested for five years and is scheduled to begin in January 2020.

The Direct Contracting (DC) payment model options also focus on transforming primary care. While PCF models focus on individual primary care sites, the DC payment models aim to engage a wider variety of organizations that have experience with financial risk, such as Accountable Care Organizations, Medicare Advantage plans, and Medicaid managed care organizations. The model participant receives a fixed monthly payment that can range from a portion of anticipated primary care costs to the total cost of care. Those in the global payment option bear full financial risk, while those in the professional option share risk with CMS. The DC models begin in January 2020.

In addition, CMS is seeking public comment on the DC Geographic option, which is expected to launch in January 2021. This model is designed to offer organizations the opportunity to assume responsibility for the total cost of care needs of a population in a defined region.

“Providing adequate financial support for high quality primary care must be an essential element of any strategy to improve the quality and affordability of our country’s healthcare system,” said Gerald E. Harmon, MD, immediate past chairman of the American Medical Association Board of Trustees. “Many primary care physicians have been struggling to deliver the care their patients need and to financially sustain their practices under current Medicare payments. The new primary care payment models will provide practices with more resources and flexibility to deliver the highest-quality care to their patients.”

All five payment models focus on supporting care for patients who have chronic conditions and serious illnesses. Through the PCF options, high-need patients with serious illness who do not have a primary care physician or care coordination and indicate an interest in receiving care from a practice participating in the model will be assigned to a model participant. Participating practices that choose to care for seriously ill population patients will be required to provide care to clinically stabilize the patient. 

For more information on PCF options: https://innovation.cms.gov/initiatives/primary-care-first-model-options/

For more information on DC options: https://innovation.cms.gov/initiatives/direct-contracting-model-options/