Medicare's Chronic Care Payment System: Who Will Benefit?

Larry Hand

November 27, 2014

Medicare chronic care management (CCM) payments, scheduled to start next year, may contribute to the development of value-oriented healthcare, but questions linger as to who will and will not benefit, according to a perspective article published in the November 26 issue of the New England Journal of Medicine.

And that key question applies to both patients and providers, write Samuel T. Edwards, MD, MPH, from the Veterans Affairs Boston (Massachusetts) Healthcare System and Harvard Medical School, and Bruce E. Landon, MD, MBA, from Beth Israel Medical Center and Harvard Medical School, Boston, Massachusetts.

They describe the CCM system, which will bring in a non-visit-based payment for CCM, as "the most important broadly applicable change [Medicare] has made to primary care payment to date."

The CCM payment will be available to medical practices that provide care to beneficiaries who have two or more chronic conditions expected to last a year or longer and who are at risk for death or functional decline. The payments would amount to $40 per month per patient, which, the authors write, would total about $100,000 a year for a practice with 200 such patients.

Practices would be required to use a certified electronic health record (EHR), provide 24-hour access to staff, appoint a designated clinician for each patient, and coordinate care among hospitals, specialists, and other providers. The provider would have to spend at least 20 minutes per month providing coordination of care for each patient.

The primary requirement will be to develop and maintain a comprehensive care plan in collaboration with the patient. Such a plan would include a list of health issues, medication-management instructions, and records of social and community services involved in the care.

In addition, Medicare beneficiaries would have to provide informed consent yearly for clinicians to be able to bill for the fee, and the patient would be required to pay a 20% copayment, or $8.00 a month.

Yet key issues remain to be resolved, Dr Edwards and Dr Landon write, including:

  • poor patients may not be able to make the copayment, and others may balk at the payment for services they were getting for free before;

  • small practices without EHRs would have a substantial burden to meet the requirements;

  • it is unclear where in current EHRs a care plan would reside;

  • the plan is not limited to primary care, but specialists who often are the principal providers for patients within their specialty may not want to take on coordination efforts; and

  • the CCM payment provides no incentive to improving quality or reducing costs, which could lead some practices to continue to use fee-for-service to fill clinical schedules in addition to CCM.

The new payment expands Medicare's efforts to promote coordinated higher-value care, the authors write. "It thus represents a critical step forward in recognizing that the essential features of primary care — continuity, whole-person focus, comprehensiveness, serving as patients' first contact for new health issues, and coordination — are not optimally supported by the fee-for-service model."

A Step in the Right Direction

"This policy is a small step forward, but a step in the right direction," Meredith B. Rosenthal, PhD, professor of health economics and policy at Harvard School of Public Health in Boston, and a member of the New England Journal of Medicine perspective advisory board, told Medscape Medical News.

"It, by itself, will not necessarily yield better coordination, but it's building the foundation to that. In the way that the payment is structured, with expectations of a minimum amount of non-visit-based time in the service of patient care, it does provide some incentive to slow down the hamster wheel."

The copayment may be a concern, she added, but "unfortunately, it's just the structure of Medicare. I think it might require an act of Congress to not require the cost sharing."

However, she thinks it probably will not affect care that much. "Physicians tend to treat all their patients similarly, even if one has a certain benefit and another doesn't, so I'm less worried that physicians would somehow ignore those patients who hadn't paid the additional fee."

Whether the $40 fee payment will be profitable for clinicians depends on individual practices, she said. "If a practice has none of these capabilities and was doing none of this before, it might be a question whether or not it's really break-even. But if a practice has already met meaningful use standards, has already developed some capabilities as a patient-centered medical home, which increasingly many practices have, then I think the incremental effort would easily make it worthwhile to participate."

Opportunity to Reward Collaboration

K. Eric De Jonge, MD, director of geriatrics at MedStar Washington Hospital Center in Washington, DC, fits into that latter category. The CCM payment will be "an opportunity to reward direct collaboration between providers and the patient and the families. I think this will allow us to really reward for the right kind of care being provided," he told Medscape Medical News.

He does not think informed consent and copayments will be large barriers for his practice. "For the kind of chronic care coordination that patients are receiving, that's a fairly inexpensive price."

But the list of requirements clinicians have to meet could be a barrier, he said. "There are a lot of order to bill for 40 bucks a month.... Some of these are new requirements."

He considers the step a halfway point to best payment reform, rewarding physicians for results, patient and family satisfaction, cost reductions, and good clinical outcomes.

Bigger Picture

Dr Rosenthal also sees a bigger picture: "In addition to being about coordination of care, I think this is about the primary care workforce. Will these additional payments provide some relief to primary care physicians who have not experienced as much income growth over the years because of the fee-for-service system? I wonder if this kind of payment model might in some way rebalance the incentives for physicians to go into primary care vs some specialty procedure-based care."

Dr Landon reports receiving personal fees from Activate Networks, Navigenics, the Massachusetts Medical Society, United Biosource, and the Research Triangle Institute outside the submitted work. In addition, Dr Landon reports a patent entitled, "Activate Networks/Method for Using Physician Social Networks to Predict Cost and Intensity of Care in Hospital." Dr Edwards, Dr Rosenthal, and Dr De Jonge have disclosed no relevant financial relationships.

N Engl J Med. 2014;371:2049-2051. Full text


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