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CMS considering direct payor contracting payment model



May 29, 2018
Area(s) of Interest: Payor Contracting Payor Issues and Reimbursement Practice Management 

The Center for Medicare and Medicaid Innovation (CMMI) recently requested comments on a potential alternative payment model that would allow direct payor contracting within the Medicare fee-for-service program, Medicare Advantage program and Medicaid.


Under the proposal, the Centers for Medicare and Medicaid Services would directly contract with participating provider practices and pay a fixed per-beneficiary, per-month payment to cover various services, such as office visits, certain office-based procedures and time spent managing care for a patient. Practices would also be able to earn performance-based bonus payments if they hit cost and quality goals.


The current models approved by CMMI are extremely limited and there are significant barriers to participation. The California Medical Association (CMA) submitted comments on this issue, urging CMMI to expand the types of alternative payment models without the current financial risk and administrative barriers. Models should work for specialists, as well as primary care physicians and small, independent practices.


CMA also urged CMMI not to require physicians to accept downside financial risk or hold them accountable for the total cost of care—since there are many costs that physicians cannot reasonably influence.


Physician-focused alternative payment models have significant potential to enable physicians to improve the quality of their patients’ care, and CMA strongly urges CMMI to greatly increase the number of available alternative payment models in order to make them a viable option for most physicians and have a meaningful impact on spending and quality of care for patients.

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