Medicare Is Sticking With Mandatory Demonstration Models for Now

WASHINGTON — Medicare is going to continue using mandatory payment models for physicians, said Elizabeth Fowler, director of the Center for Medicare & Medicaid Innovation (CMMI), at an event Tuesday sponsored by the Alliance for Health Policy and the APCO Worldwide public relations firm.

“We have two mandatory models making their way through the regulatory process — the comprehensive joint replacement model, which we’ve proposed to become mandatory … and then the radiation oncology model,” Fowler noted. “With a lot of the voluntary models, we have seen risk selection for various reasons — the people that come into our models, the people that stay in our models till the end, are those that are more likely to succeed, or those who are more likely to have the resources to participate, and so we’re not capturing, I think, a certain segment of the provider community.”

“So I think we should look down the mandatory model line, but — and I have said this in other settings — we need to move away from having a model for every episode, and every specialty. I think doing so perpetuates some of the fragmentation in the healthcare system, so if we do mandatory models they need to be brought up very carefully in the context of the rest of our strategy,” she continued. “We need to be looking down the ‘total cost of care’ road, but some of those advanced primary care practices could benefit from innovation in paying for episodes of care. So where can we make sure that those are aligned, and that the models are harmonized in a way that maybe we haven’t thought about before?”


Although the agency appreciates the concerns about its mandatory radiation oncology demonstration model, “I also think that the model is a solid one and it hopefully will lead to positive results for patients,” said Elizabeth Fowler, director of the Center for Medicare & Medicaid Innovation. (Photo courtesy of the Alliance for Health Policy livestream)

Fowler said she has been hearing from stakeholders that “Gee, we’re in an ACO [accountable care organization], and then we’re also in these bundled payment models, and then when it comes time to [calculate] savings, where do the savings go?”

“So we need to have better answers to those questions and think about making sure that these models are coordinated with each other,” she added. “So, looking down the road of episodes, where are those very-high-cost, low-volume [services] where having a model might be of greatest benefit and greatest impact to a ‘total cost of care’-type approach?”

The radiation oncology model has been stirring controversy among radiation oncologists precisely because it is becoming mandatory. “Mandatory models, by definition, violate the spirit of CMMI, which we totally support as a great concept,” Ted Okon, MBA, executive director of the Community Oncology Alliance, which represents office-based oncology practices, told MedPage Today. Instead of instituting a mandatory model, CMMI should be hewing to its original concept as outlined in the Affordable Care Act and “piloting [voluntary] phase one models, then turning them into broader phase two models, which should be done in collaboration with stakeholders,” said Okon. “Mandatory models are like castor oil — they’re shoved down your throat.”

Under the radiation oncology payment model, Medicare will “make prospective, modality agnostic, episode-based payments in a site-neutral manner for 16 different cancer types,” according to CMS, which also said the model “is expected to improve the beneficiary experience by rewarding high-quality, patient-centered care and incentivizes high-value radiation therapy that results in better patient outcomes.” During a question-and-answer session with reporters, Fowler said she knows there are concerns about the model but that CMMI is sticking with it.

“We’re hearing from those who feel like they stand to lose, and I appreciate and understand those concerns,” she noted. “In some cases they may see an increase but that’s not who we’re necessarily hearing from. I have done many meetings on that issue and I understand where they’re coming from and their concerns, but I also think that the model is a solid one and it hopefully will lead to positive results for patients.”

Fowler was also asked about a recent Health Affairs article that discussed the way some Medicare Advantage plans are trying to show that they take on more risk — and therefore deserve higher payments — using what the authors called “risk-score gaming” when submitting reimbursement codes. The authors wrote that although the codes submitted “are, presumably, accurate,” they result in overpayments because of the way CMS adjusts for risk.

“On many of the issues that the authors raised about gaming that’s happening on the coding side, I couldn’t agree more,” Fowler said. “The current risk adjustment methodology should be either improved or replaced, and we are thinking about that at CMMI, so we do have a role in that … Medicare should be ensuring that plans caring for sicker patients are not disadvantaged, rather than rewarding those who are investing in the best technology” to figure out the best codes to use.

Reducing administration hassles is also on Fowler’s agenda. “I think we need to do a better job on that front … These areas of friction that either inhibit participation or just make it exceedingly difficult — those are things that we need to think about,” she told MedPage Today, adding that it’s also on the radar screen of CMS’s Center for Medicare director Meena Seshamani, MD, PhD. “Her team and my team have been thinking about doing a better job of coordinating the options that are available, and making sure that we’re all on the same page going forward. How can we do a better job of aligning the Medicare Shared Savings Program [ACO] and the ACO programs that we [at CMMI] lead, so we’re making sure that we do what we can in terms of how providers are aligned, and patients are aligned, and that we think more carefully about these issues that providers are rightly raising?”

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    Joyce Frieden oversees MedPage Today’s Washington coverage, including stories about Congress, the White House, the Supreme Court, healthcare trade associations, and federal agencies. She has 35 years of experience covering health policy. Follow

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