Alternative Payment Models: What Can Physicians Expect and How Can They Effectively Prepare?

Value-based care delivery models are evolving, and alternative payment models (APMs) have the potential to realign payment incentives and care delivery. The APM track reimburses Medicare providers based on the value of services compared to the volume of services. Approximately 34 percent of all healthcare payments made in 2017 were tied to an APM (with APM spending at approximately $385.5 billion nationally) through shared savings and shared risk models, and CMS predicts that 185,000 to 250,000 clinicians in 2018 will participate in Advanced APMs. Although current physician pay is still largely driven by volume, this is shifting given value-based performance models, and the sooner that program measures are successfully met, the better prepared physicians will be to improve patient outcomes, earn bonus payments, and reduce overall costs.

For APM entities sufficiently participating in an Advanced APM, CMS rewards the entity’s clinicians with an annual incentive (paid 2019 – 2024) equal to 5% of the previous year’s Part B annual payments for covered professional services, and physicians also earn an exemption from MIPS. The net financial gain from participation in an Advanced APM can be greater than 5% if the APM realizes shared savings, so the incentives are for Cooper physicians to benefit, which are based on a patient attribution model. Alternatively, by 2022, the physician Merit-Based Incentive Payment System (MIPS) score will significantly impact Medicare reimbursement from -9% to +27%, with adjustments related to achieving clinical quality measures, which represents a sizeable financial impact.

What are some advanced APM programs that qualify at Cooper?

•Comprehensive Primary Care Plus (CPC+)
•Accountable Care Organization (ACO) Model
•Oncology Care Model (OCM)
•Medicare Shared Savings Program (MSSP)
•Bundled Payments for Care Improvement Advanced Model (BPCI Advanced)

How can Cooper providers prepare for clinical and financial success within alternative payment models?

1. Measure, understand, and benchmark quality and performance measures as CMS typically updates on an annual basis
2. Identify specific opportunities to improve patient care that are likely to result in spending reductions across the patient’s full episode of care, including preventive visits and post-acute care utilization
3. Engage in routine communication on value-based care programs, the cost of care, and continued performance improvement opportunities with Cooper

What else can physicians expect?

In the 2019 proposed role, CMS does not propose significant changes to the APM path, with no new Medicare programs that qualify and the qualifying participant thresholds remaining the same. Historically, we have seen these programs begin as voluntary then transition to mandatory with time for physicians and health systems to plan, prepare, and track. Participation in APMs requires organizational commitment, dedicated resources and experience, advanced analytics, and communication, and Cooper has the intention of continued APM program evaluation and participation growth, engaging and working with physicians on program planning and implementation. Payment models are complex, continually evolve, and now include downside financial risk related to achieving clinical measures so physicians must engage, track, and continuously improve in order to be successful.

Tori Manis

Tori Manis

Assistant Vice President, Strategic Planning & Business Development
Cooper University Health Care

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