The Medicare Behemoth Finally Smiles on Primary Care

Kenneth W. Lin, MD, MPH


July 14, 2023

Hi, everyone. I'm Dr Kenny Lin. I am a family physician and associate director of the Lancaster General Hospital Family Medicine Residency, and I blog at Common Sense Family Doctor.

Kenneth W. Lin, MD, MPH

Four years ago, I wrote a Medscape commentary about new payment models piloted by the Centers for Medicare & Medicaid Services (CMS) Innovation Center, including the Primary Care First model. Primary Care First provides practices with quarterly upfront per-patient payments, flat office visit fees, and a performance-adjusted increase or decrease in total payment based on acute hospitalizations or total cost of care and selected quality measures. To further enhance revenue flow and reduce documentation burdens, CMS encouraged state Medicaid agencies and commercial insurers with patients at Primary Care First practices to also provide prospective, rather than fee-for-service, payments.

When it launched in 2021, a total of 846 practices participated in Primary Care First, and more than 3000 practices participated in 2022. An initial evaluation of the program by Mathematica found that most practices met quality benchmarks for diabetes, hypertension control, and screening for colorectal cancer. Practices implemented care management protocols to reduce hospitalizations and readmissions for patients with chronic conditions. Prospective payments allowed many practices to enhance access (eg, via telehealth) and provide onsite behavioral health services or tighter integration with community providers.

The COVID-19 pandemic made it clear that redesigning the US healthcare system to prioritize primary care financing is essential to improve population health and eliminate health disparities. Although the 2021 CMS payment increase for evaluation and management services was intended to reduce the disparity between primary care and specialist payments, an analysis estimated that the gap shrank by a mere 2% during the first year, or just over $800. Last year, past and current presidents of the American Academy of Family Physicians called on Congress to "step up" for primary care by increasing the Medicare Physician Fee Schedule conversion factor (which is otherwise automatically reduced due to budget neutrality rules) and fix the onerous prior authorization process for Medicare Advantage plans.

In the meantime, CMS has proposed streamlining quality measures across its value-based payment programs, announcing a Universal Foundation of measures with strong supporting evidence for improved patient outcomes in common conditions. Leaders of the national primary care practice network Aledade urged CMS to focus on measures that can be reliably reported and are a high priority for population health. They advised limiting quality assessment to a core set, rather than treating the Universal Foundation as a "building block" to which additional measures could be added, increasing the burden on clinicians.

In this context, CMS is rolling out a new primary care payment model, Making Care Primary, targeted to independent rural practices, federally qualified health centers, and Indian Health Service clinics in eight states. The pilot will run from July 2024 to December 2034. It consists of three progressive tracks based on practices' prior experience with value-based payment arrangements. Like Primary Care First, Making Care Primary will provide prospective per-patient payments to help practices integrate care and address community-specific needs, and its quality measures will align with the Universal Foundation. In a recent blog post, CMS Innovation Center officials discussed their top priorities for primary care: strengthen financing, advance equity, and make practice transformation sustainable by facilitating long-term commitments to value-based payment arrangements across all payers.

With the Making Care Primary model, CMS is signaling that it recognizes that there is no "one size fits all" approach to primary care financing that supplants fee-for-service. This flexible new pilot program, along with the ongoing Primary Care First demonstration, should provide the data we need to decisively shift the $1 trillion–per-year Medicare behemoth onto a path that will provide stable revenue flows for family physician–led practices and compensate primary care teams appropriately for keeping our patients and populations healthy.

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