CMS: Primary Care First payments higher than expected

Year one of Primary Care First (PCF) value-based care saw higher than expected payments to participants who largely met quality benchmarks.

By admin

Dec 20, 2022, 10:32 AM

First-year participants in a voluntary value-based care model developed by the Centers for Medicare & Medicaid Services (CMS) received payments deemed “adequate if not higher than expected,” according to a study report released by the CMS Innovation Center. The program continues efforts by CMS to enhance primary care while moving practices away from fee-for-service (FFS) toward value-based payment.

The Primary Care First (PCF) model, launched in 2021, requires participating primary care practices to take on upside and downside financial risk for the most common care services delivered to their attributed Medicare FFS population. The intent is to reward quality and value while reducing administrative burden.

PCF participants agree to forego reimbursement based on Medicare’s physician fee schedule for a defined set of primary care services. Instead, PCF practices receive a flat visit fee plus quarterly population-based payment (PBP). Performance adjustments, calculated after the first year of PCF participation, can increase payment by up to 50% or decrease it by up to 10% based on practices’ performance on acute hospitalizations, total cost of care, and quality measures such as patients’ experience of care and documentation of an advance care plan.

First-year Primary Care First

Cohort 1 practices (i.e., those covered in the Year 1 report) said they joined Primary Care First to be at the forefront of care transformation and to improve quality of care. They also appreciated the predictability of revenue from PBPs, according to CMS, which paid more than $190 million in 2021 to PCF Cohort 1 practices. Median annual PBPs ranged from $144,000 to $767,000, depending on risk groups. Annual flat visit fee payments averaged roughly $60,000 among practices in all risk groups.

Simulations performed by the program’s evaluation team suggest that total payments in PCF are about 20% higher than expected Medicare FFS payments if practices had not joined the model. Performance adjustments began in April 2022. About one-fifth of practices received a negative performance-based adjustment (averaging $6,813 per practice), while more than one-third of practices received a positive adjustment (averaging $14,266 per practice).

CMS acknowledged that participating practices entered the PCF model with advanced care capabilities and that care delivery changes in 2021 were largely enhancements of existing activities. Nonetheless, Cohort 1 practices expressed confidence in improving PCF-targeted outcomes. Most practices met quality benchmarks related to control of diabetes and high blood pressure, as well as measures for colorectal cancer screening. They plan to use care management strategies to reduce hospital readmissions through improved post-discharge follow-up. They’ll also strive for fewer preventable hospitalizations among patient subgroups with complex conditions.

Frank Irving is a Philadelphia-based content writer and communications consultant specializing in healthcare and technology.