Life Science Compliance Update

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June 13, 2016

Better Patient Care Doesn’t Necessarily Equal Patient Savings

In October 2012, the Centers for Medicare and Medicaid Services launched the Comprehensive Primary Care Initiative, in collaboration with thirty-nine private and public payers. Primary care practices that participated in the Initiative were required to make changes in care delivery that would build their capability in five functional areas: (1) access to and continuity of care; (2) planned care for preventive and chronic needs; (3) risk-stratified care management; (4) engagement of patients and their caregivers; and (5) coordination of care with patients' other care providers.

The Initiative supports the efforts of the participating practices by offering enhanced payment, data feedback, and learning support, as well as presenting an opportunity to evaluate a new multipayer model of payment and primary care delivery, in a large and diverse set of practices.

A group of doctors and researchers recently published a study in the New England Journal of Medicine that assessed the effects the Initiative had on Medicare expenditures, the use of services, selected measures of the quality of care, and patient experiences during the first two years of the Initiative.

During the first two years of the Initiative, practices received a mean of $131,000 per clinician in care-management fees and reported improvements in approaches to the delivery of primary care in areas such as management of the care of high-risk patients and enhanced access to care. This amount did vary according to the practice and region, depending on the number of participating payers, the number of patients attributed to practices by each participating payer, and each payer's payment amount. Interestingly, however, changes in average monthly Medicare expenditures per beneficiary did not significantly differ between initiative and comparison practices.

The effects on Medicare expenditures varied quite a bit across Initiative regions. Initiative practices had significant reductions in expenditures when fees were not included in two regions: New Jersey and Tulsa. Significant increases in net expenditures were found when fees were included in Cincinnati-Dayton.

The number of hospitalizations also did not change significantly for Initiative practices over the two year period. The only significant difference that the researchers found were a 3% reduction in primary care visits for Initiative practices compared to comparison practices and small changes in two of the six patient experience domains: discussion of decisions regarding medication with patients and the provision of support for patients taking care of their own health.

The researchers concluded that while practices that are participating in the Initiative have reported progress in transforming the delivery of primary care, these practices have not yet shown savings in expenditures for Medicare Parts A and B after accounting for care management fees, nor have they shown an appreciable improvement in the quality of care or patient experience.


The study did suggest that Initiative practices are transforming care delivery; however, they have not yet generated savings in Medicare Part A and B expenditures that are sufficient to cover care-management fees. The 3% reduction in primary care visits suggests the non-billable calls, emails, and interactions related to care management may have reduced, or even supplanted, the need for office visits.

The study also provided some possible reasons as to why the results were not more favorable. One such reason was that practices may need more time to fully implement changes in care delivery that translate to improved outcomes. It is also possible that practices will reduce expenditures enough to offset a lower fee; that CMS will reduce its average fee to $15 per beneficiary per month in the last two years of the Initiative, reducing not only the gross savings required to reach cost neutrality, but also the resources available to achieve those savings.

The study had several limitations, one of which was that practice participation in the Initiative is voluntary, and the analysis was limited to their attributed fee-for-service Medicare beneficiaries. The fact that patient experience was not measure prior to the start of the Initiative also makes it difficult, since there may have been preexisting differential trends between Initiative and comparison practices.

As CMS continues to pay for health care through alternative payment models that reward quality and value, the Initiative may help inform future policies guiding models for primary care delivery in the United States.

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