CMS relaxing more value-based model requirements in wake of pandemic

Dive Brief:

  • CMS said Wednesday it is decreasing the risk requirements and pushing back some deadlines for value-based payment models in the wake of the COVID-19 pandemic.
  • The changes are aimed at minimizing reporting burden and increasing flexibilities for providers as they continue to face great financial and logistical challenges from the novel coronavirus.
  • In the Comprehensive Care for Joint Replacement Model, for example, CMS is removing downside risk by capping actual episode payment at the target price for care during the public health emergency, extending the appeals timeline for the third and fourth performance years and extending the fifth performance year through March 2021.

Dive Insight:

As the pandemic has upended healthcare delivery in the United States, one less urgent but still prominent concern has been the toll the upheaval will take on the decades-long shift to value-based payment reform. 

CMS has attempted to keep the models from its Center for Medicare and Medicaid Innovation arm operational but flexible so that providers aren’t forced to drop out as they experience the financial toll from pausing elective procedures in March and April. 

“Of course, when it comes to a pandemic of the proportion we’re now experiencing, as part of ensuring that value-based payments are sustainable, the models must be adjustable to address the uniqueness of the current situation,” CMS Administrator Seema Verma wrote in a Health Affairs blog post about the changes.

The changes announced Wednesday add to adjustments made in late March to the Medicare Shared Savings Program, Hospital Readmission Reduction Program, Merit-Based Incentive Payment System and other models in an effort to cut red tape.

Provider organizations have lobbied for the moves as patient surges have caused equipment shortfalls and overworked staff in numerous parts of the country. Last month, several accountable care organizations asked for further leniency from CMS to keep value-based programs stable and participants from dropping out.

Group purchasing organization Premier found in a recent survey that more than half of participants in two-sided risk models feared incurring losses due to the pandemic.

Other changes CMS laid out in a chart published Wednesday include removing some shared losses in the Next Generation ACO model, removing episodes of care for treatment of COVID-19, canceling the 2019 quality audit and extending the model through December 2021.

In a statement Wednesday, the National Association of Accountable Care Organizations applauded the extension as well as the decision to accept a second round of applications for the Direct Contracting Model, but said more details on risk adjustment and patient populations in that model still need to be released.

The Bundled Payments for Care Improvement – Advanced model, which tests bundled payments for 90-day clinical episodes of care, will add an option for participants to exclude clinical episodes from the third model year. And the start of the Emergency Treat, Triage, and Transport model, which aims to lower ambulance costs in Medicare, will be delayed from this month to fall of this year.