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274 Healthcare Industry Organizations Advise CMS to Add Medicare Advantage Advanced APMs

Posted on Thursday, March 9, 2017 5:05 PM

CAPG and 274 healthcare industry groups recently advised CMS to implement financial incentives comparable to those in the Quality Payment Program’s Advanced Alternative Payment Model (APM) track for providers who assume financial risk under Medicare Advantage plans.

“For too long, policymakers have focused solely on improving care delivery in traditional Medicare only,” Donald Crane, CAPG President and CEO, stated in a press release. “It’s time to bring the same focus and the same encouragement to care delivery in Medicare Advantage.”

In a letter to CMS Acting Administrator Patrick Conway, the 274 organizations pointed out the lack of incentives available to providers in risk-based Medicare Advantage contracts.

Some providers still remain under fee-for-service with the Medicare Advantage plans, however others have already moved to alternative payment models to receive Medicare Advantage revenue.

Recent research revealed the following about providers in risk-based Medicare Advantage contracts:
• Better patient outcomes than providers in fee-for-service-based Medicare Advantage arrangements
• Patients treated by the provider group had a 6 percent better survival rate than patients in the fee-for-service provider group
• Researchers reported that the providers in risk-based Medicare Advantage contracts saved over $2.07 million per 1,000 enrollees

“This striking delta is the result of a model that aligns incentives toward better quality care and higher patient satisfaction,” wrote CAPG and the other organizations. “The payment model from MA [Medicare Advantage] plan to MA provider is a driver of this quality difference.”

In order to move forward with the value-based care transition, the organizations encouraged CMS to incentivize risk-bearing Medicare Advantage contracts.

“Today, nearly a third of Medicare beneficiaries are enrolled in MA,” the letter stated. “In some counties, more than half of seniors are enrolled in an MA plan. Overlooking the delivery system in MA is an oversight that thwarts the goals of a reformed delivery system as MA constitutes a growing share of Medicare.”

In addition, CMS should implement more plans and providers to take on risk-based Medicare Advantage contracts.

Only 20 percent of Medicare Advantage plan provider compensation arrangements include more than nominal financial risk, reported Healthcare Payment Learning & Action Network in October 2016.

“Given the striking quality difference in MA APMs, we see this as a substantial opportunity to improve the delivery system and quality of care for seniors,” the organizations wrote.

To develop financial rewards for providers assuming risk under Medicare Advantage contracts, the organizations offered CMS the following recommendations:
• Include Medicare Advantage risk between the plans and providers as part of the Advanced APM track’s participation requirements
• Create an Advanced APM specifically for Medicare Advantage

“This structure should be the same as MACRA in that once a physician group and health plan take enough risk to exceed predetermined thresholds, CMS should make Part C incentive payments to plans and physician groups to encourage greater risk-sharing and higher quality care over time,” wrote the organizations.

CMS plans to release the final rule on April 3.

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