Earlier this year, the Center for Medicare and Medicaid (CMS) announced five new payment models designed to transform primary care by paying providers for outcomes rather than services. Direct Contracting and Primary Care First are two of these models announced by CMS to help encourage providers and other eligible professionals to shift from FFS to value-based payments. HHS Secretary Alex Azar calls the new payment models “the biggest step ever taken toward” value-based payments in primary care. Azar states the models will test out paying for health and outcomes rather than procedures on a much larger scale and is designed to encourage state Medicaid programs and commercial payers to adopt similar approaches.
Although these models are considered voluntary and therefore experimental, this is not the first and most certainly not the last we’ve seen of these core concepts. These primary care models build on some of the recent changes to Medicare Shared Savings Program (MSSP) and the new “Pathways to Success” program. While the “Pathways to Success” program is focused on specific groups in a risk-sharing arrangement, Direct Contracting is CMS’s attempt at re-engaging those providers and organizations who are no longer in the MSSP Program as well as expanding the reach to allow other providers to take on downside risk.