CMMI Flexing New Primary Care Model

As the CMS Center for Medicare and Medicaid Innovation (CMMI) works towards achieving its goal of all Medicare beneficiaries in an accountable care relationship by 2030, we’re seeing a flurry of new payment models to incentivize the ~50% of providers currently on the value-based care sidelines. One of these new payment models (available to ACOs also within Medicare Shared Savings Program; MSSP) is the Accountable Care Organization Primary Care Flex Model, or ACO PC Flex Model which is further shortened to ACO FLEX.

What is ACO FLEX?

The ACO FLEX model is aimed at primary care, specifically trying to increase access to coordinated care for all Medicare beneficiaries, particularly underserved populations. Navigating the healthcare system is increasingly fragmented and complex for our older population. Comprehensive primary care results in fewer complications, more days at home instead of a hospital, and lower mortality rates. According to CareJourney data, in the last few years the proportion of the Traditional Medicare population receiving no primary care has grown. Additionally, this segment is largely minorities and beneficiaries in distressed areas. For these patients, often, primary care practices simply do not have the resources to provide the needed comprehensive primary care.

ACO FLEX intends to combat this challenge. The model features monthly primary care payments to ACOs, as well as an up-front $250,000 advance on shared savings, arming practices with an influx of capital at the beginning of a performance year to support their patients’ primary care needs. This program will begin operation on January 1, 2025 and run through December 31, 2029.

As CMS looks to include all Medicare beneficiaries in an accountable care relationship, one strategy is to induce the providers who care for these beneficiaries to participate in a value based program. Commonly, providers are not participating in value based programs due to:

• The high cost to establish an ACO
• The lengthy period of time between performance and financial savings after reconciliation

The $250,000 advance on shared savings alleviates those concerns – hoping to draw more providers.

Additionally, ACO FLEX’s monthly primary care payments incentivize primary care providers with a stable income to provide more cohesive primary care. This approach has been previously tested with Primary Care First (PCF), a popular model also providing monthly payments for primary care. Providers we have spoken with value those monthly payments over a potentially greater shared savings payment due to their certainty and timeliness. By adding this feature into MSSP (which offers greater shared savings than PCF), CMS is broadening the reach of the MSSP program by enticing those previously reluctant to join. CMS is hopeful that these regular payments to practices will cover not only primary care, but enhanced primary care with a higher level of integrated care.

Who is Eligible for ACO FLEX?

The requirements for ACO FLEX include four criteria. Specifically, the ACO must:

• Participate in MSSP, either as a new entrant, renewal, or current participant that signs a new participation agreement;
• Qualify as a low revenue ACO with the sum of the ACO’s Part A and Part B fee for service revenue less than 35% of the total Part A and Part B expenditures for that ACO’s aligned population;
• Utilize prospective beneficiary alignment;
• Not receive Advance Investment Payments.

For 2024, there are 276 low revenue MSSP ACOs, representing 57.5% of all ACOs. These low revenue ACOs tend to be physician-led, made up mainly of practitioners. Very few of the low revenue organizations contain large hospitals, although some may contain smaller hospitals, FQHCs, and rural health clinics. In total, CMS has indicated they expect to accept approximately 130 ACOs into ACO FLEX, and encourage new ACOs.

How is the Financial Model Structured?

While CMS has not published the comprehensive details, they describe the model elements. As mentioned above, each FLEX ACO will receive two types of payments:

One time advanced shared savings payment: This $250,000 one-time payment is an advance payment against future shared savings. It can be used to offset start-up costs for the ACO and to mitigate the expenses associated with additional reporting requirements. Participants will repay this advancement, although the timing on the repayment has not been disclosed (at the time of publication).

Monthly prospective primary care payments (PPCP): These monthly payments are comprised of two parts:

• An amount based upon the county average amount spent per beneficiary on eligible primary care services (“County Base Rate”); and,
• An additional amount designed to cover enhanced primary care services.

This County Base Rate is not based on the ACO’s historical claims, but rather all aligned Medicare beneficiaries within that county – a difference from other CMMI models intended to increase the amount that ACOs spend on primary care. The County Base Rate is not “at-risk” – meaning ACOs submit claims to CMS for primary care services, but there is no reconciliation process for the County Base Rate at the end of the performance year. Additionally, the County Base Rate will be adjusted for counties that have historically low spend on primary care.

Similarly, the enhanced primary care services portion of the PPCP will not be recouped by CMS. CMS has indicated that the PPCP may be subject to additional adjustments, based on policy objectives, likely the Health Equity Benchmark Adjustment found in ACO REACH adjusting for social and economic variables.

Additionally, monthly payments will also be increased for beneficiaries who receive a plurality of their care from a Federally Qualified Health Center (FQHC) or a Rural Health Clinic (RHC).

Shared Savings: Beyond these payments, since the FLEX ACO is a participant in MSSP, the ACO will still earn (or owe) shared savings based upon the MSSP methodology. The PPCPs won’t affect the ACOs benchmark in the current agreement period, but in subsequent agreement periods those payments would be included in the benchmark calculations.

How is Quality Incorporated Into the Model?

Like all other MSSP ACOs, ACO FLEX organizations must report quality measures as required. The ACO FLEX program incorporates an additional quality measure called the Person Centered Primary Care Measure (PCPCM). The PCPCM measures the improvement of primary care services by FLEX ACOs via a survey financed and administered by CMS. This new PCPCM measure will not impact shared savings.

What Comes Next?

As we await the Request for Applications (RFA) from CMS containing more details, we know that many providers are curious about whether this model is right for them.

We are hopeful this model “flexes” the right incentives to increase participation in value-based programs, as we believe the move to value is critical for our health system.

In considering your path forward, we would love to support your journey. Our analytics, product suite, and services team are here to help.

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