Background
People who have access to high-quality primary care are more likely to receive preventive health services and screenings and to experience improved health outcomes related to mortality, disease progression, and chronic condition management. Yet, in the United States, primary care providers face workforce shortages and other challenges that highlight a need for increased funding. ACOs play a key part in addressing these challenges but have been hampered in their ability to pay for advanced primary care because of the way incentives are structured in the traditional fee-for-service system.
Aims
The ACO PC Flex Model aims to:
- Expand access to high-quality, accountable care and improve the patient experience for people with Medicare.
- Enhance primary care payment and spur innovative approaches to care delivery — such as team-based care that is proactive and person-centered and drives quality improvement.
- Reduce program expenditures while preserving or enhancing the quality of care for people with Medicare.
- Strengthen participation incentives for new and low revenue ACOs in the Shared Savings Program.
Innovation
The ACO PC Flex model is based on a National Academies of Sciences, Engineering and Medicine report (Implementing High-Quality Primary Care: Rebuilding the Foundation of Health Care) which recommended funds flow to primary care through ACOs to better support team-based care and provider infrastructure.
The model’s Prospective Primary Care (PPC) Payment option shifts payment for primary care away from fee-for-service, visit-based payment to a flexible, predictable revenue stream.
The model also includes a one-time Advanced Shared Savings Payment to help cover costs associated with forming an ACO and administrative costs for model activities. Recent Shared Savings Program results continue to underscore the importance of high-quality primary care to the program’s success.
Design
The ACO PC Flex Model advances payment arrangements within the Shared Savings Program through:
- A regionally consistent rate for primary care spending. The Prospective Primary Care (PPC) Payment is a monthly payment made up of two parts: the County Base Rate and Payment Enhancements, where relevant.
- The PPC Payment County Base Rate will not be based on the historical experience of the ACO, but on a county’s average primary care spending.
- PPC Payment Enhancements — which are intended to provide additional resources to ACOs to support increased access to primary care, provision of care, and care coordination — will not be put at risk, meaning they will not be recouped by CMS. This will increase the long-term predictability and stability of primary care resources.
- Specific policies to ensure PPC Payment funds are used to support primary care.
- A one-time Advanced Shared Savings Payment to help cover costs associated with forming an ACO and administrative costs for model activities.
The design of the PPC Payment as a flexible, predictable revenue stream that can exceed existing payment levels is expected to appeal to many low revenue ACOs and make it an attractive option. These components include basing an ACO’s PPC Payment rate on its average county primary care spending rather than on its historical spending. This enables the model to pay an ACO the same rate for a given person in a region thereby increasing payment for providers that have entrenched patterns of inappropriately low spending. The ACO PC Flex Model aims to improve outcomes by:
- Increasing access to higher-quality primary care, which can include unique services such as proactive care management, patient navigation, and behavioral health integration.
- Aligning more people with Medicare to ACOs by incentivizing the formation of new ACOs.
- Providing primary care practices with flexible funding necessary to improve care coordination and identify and address people’s unmet health-related social needs.
