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CMS unveils two-tier medical home care management fee

CMS unveils two-tier medical home care management fee

Second tier is technology-focused

The Centers for Medicare & Medicaid Services (CMS) has provided a blueprint for the Medicare Medical Home Demonstration (MMHD) that is planned to launch in 2010.

In its demonstration project, CMS is defining the medical home as practices that score above the National Committee for Quality Assurance’s Physician Practice Connections—Patient-Centered Medical Home thresholds in continuity of care, clinical information system, delivery system design, decision support, patient/family engagement, coordination of care across providers and settings, and improved access to care.

CMS believes the demonstration will attract practices because of care management fees, sharing of project savings, better quality of care, and improved practice work flow and job satisfaction.

CMS’ MMHD project will include a two-tier structure that is based on the practice’s capabilities. The practices that are qualified to take part must develop and implement care plans, use evidence-based medicine and decision support tools, utilize health information technology (IT) to monitor and track health status, and encourage patient self-management.

The two-tier system is:

  • Tier 1: Basic medical home services, basic care management fee
  • Tier 2: Advanced medical home services, full care management fee

The first tier is an entry-level step into the medical home. It includes integrated care plans, patient education and support, and written standards for patient access. The second tier builds on that foundation with technology such as electronic health records (EHR) that capture clinical information, including blood pressure and lab results; a systematic approach to coordinate facility-based and outpatient care; and additional capabilities, including e-prescribing. (See “Definition of the medical home tiers” on pp. 15–17 of the PDF for the full list.)

Vince Kuraitis, JD, MBA, principal and founder of Better Health Technologies, LLC, in Boise, ID, says the demonstration design shows that CMS believes technology is necessary to implement the medical home.

“It’s a carrot to incentivize physicians to be able to develop electronic health records with the belief that, ultimately, they are going to be necessary,” says Kuraitis. “I think there is a broader public policy objective being woven in around health information technology, and in my opinion, that’s a good thing and in the right direction.”

Bruce Bagley, MD, medical director for quality improvement at the American Academy of Family Physicians in Leawood, KS, says primary care physicians are already on the path to EHRs. Bagley says half of his organization’s membership has EHRs and another one-quarter are shopping for the technology.

Who is eligible?

CMS plans to reveal the eight geographic sites that will take part in the project by the end of 2008, which will include urban, rural, and medically underserved sites. (See Figure 12 on p. 13 of the PDF.)

Eligible physician practices for the CMS project include general internists, family practices, and geriatrics. Radiologists, pathologists, anesthesiologists, dermatologists, and psychiatrists are some of those not eligible to take part.

CMS has limited the requirements for beneficiaries to participate. Patients eligible to take part in the MMHD are Medicare fee-for-service beneficiaries with at least one eligible chronic condition who are not living in a hospice or nursing home, receiving treatment for end-stage renal disease, or enrolled in Medicare Advantage. Eighty-six percent of Medicare beneficiaries fit those criteria, according to CMS.

Kuraitis says opening the project to so many Medicare beneficiaries should attract physicians, who will see the demonstration includes healthier seniors, as well as those with comorbidities. The limited requirements also move the demonstration from a chronic disease project to one that deals with prevention and wellness. The legislation that created the demonstration did not allow for such a wide population, but Kuraitis says the change is a positive.

Care management fee

CMS will pay a per-member per-month care management fee depending on the practice’s medical home tier and the chronic disease burden in the patient population. The fee will be based on the AMA/Specialty Society RVS Update Committee (RUC) physician work relative value units, practice expenses, and insurance, and is risk-adjusted depending on the Hierarchical Condition Categories score of the patient.

In April, the RUC recommended a payment structure that was praised by some, but criticized by those who believed the care management fees would not pay physicians enough to take part.

Bagley says he believes the latest care management fee will be enough to care for the Medicare beneficiaries in the demonstration. Kuraitis, who questioned the previous care management fees, likes the new payment proposal. A practice in Tier 2 will receive about $100 per member per month for the more at-risk patients. Spread that money out among a couple hundred Medicare beneficiaries, some of whom have only one chronic illness, and physicians should take part in the project, he says. (See Figure 13 on p. 14 of the PDF.)

To interest physicians, Kuraitis says CMS should err on the side of paying too much. “You can always ramp it down. If you don’t pay them enough and they’re not interested, the project is dead in the water and you will have alienated them,” he says.

Practices will also get to share in the project’s savings. The first 2% of savings are not shared with practices, but 80% of the savings above that 2% figure will be shared with practices. CMS will allocate the money based on members-months of enrolled patients.

Population health

CMS’ MMHD is an opportunity for population health/disease management (DM) companies, according to those in the industry.

Some DM programs that could become part of practices are 24/7 nurse lines, chronic illness registries, patient self-management support, care coordination services, IT support, predictive modeling, remote monitoring, and health coaching.

Tracey Moorhead, president and CEO of DMAA: The Care Continuum Alliance in Washington, DC, says many members of her organization are looking at how they could offer services to help physician practices involved in the medical home, adding that DM companies don’t view the medical home negatively. “I don’t think we have ever seen [the medical home] as competition. I think it’s a very important opportunity to learn from previous models,” says Moorhead.

Moorhead says population health has the opportunity to supplement physician practices. After a decade of work in DM and population health, companies have the knowledge and programs to help physicians take advantage of their services within the medical home, she says.

Bagley says DM companies will offer the same kinds of programs in the medical home, but they will contract with practices rather than health insurance companies. “It’s just a shift in how they do their business,” he says.

In fact, Bagley thinks working with practices will work better for DM and population health companies.

“I think traditional disease management didn’t work because it tried to identify people with a condition, contact them directly, and then hope to engage the primary care physician—and it was financed outside any medical reimbursement. In the new model, the way we see it, the same kind of resources should flow to the primary care physician’s office,” he says.

Kuraitis says he is unsure whether physicians will welcome DM and population health organizations into their practices because of past problems between the groups. Physicians may instead initially work with EHR vendors.

“DM companies will try to be doc-friendly. I would be surprised if the docs really connect with the DM companies,” he says.

Not final yet

The demonstration design is not final and is being reviewed by CMS and the U.S. Department of Health and Human Services before heading to the Office of Management and Budget.

The MMHD’s ultimate evaluation will focus on how practices provided medical home services and the effects on Medicare cost and utilization; quality-of-care and health outcomes; physician and practice work flow, costs, and satisfaction; and experience of care for patients and families.

Bagley says he hopes CMS will look beyond cost savings. “I would hate to hang my hat on system cost savings alone. There are so many other drivers that are unrelated to the medical home that will not necessarily be brought under control by care management,” he says.

DM and medical home supporters are eager to get started. “My advice would be to get this puppy on the road and get going. You can design around the edges, but basically the fundamentals are there. Get this thing done so we know what works, what doesn’t work, so we can design even better systems of care by the time [President-elect Barack] Obama is getting out of office,” says Jaan Sidorov, MD, MHSA, FACP, own-er and operator of Sidorov Health Solutions in Harrisburg, PA.