Payment Reform

Problem: 

Fee-for-service health care reimburses providers for the volume of services rather than their value to patients. Reforming payment so it rewards value over volume is fundamental to achieve the three-part aim of better health, better care and lower costs. Incentivizing value makes sense, but nationally, only about 11 percent of payments to hospitals and doctors are tied to quality and efficiency of care. But it’s the direction of the future.  

Specifics of payment reform depend on the dynamics of a particular location and population. That’s why Rocky Mountain Health Plans’ (RMHP) approach is community-based, patient-centered and region-specific. 

Payment reform drives health system redesign; it also requires it. Individual organizations need to adopt process improvement strategies as well as create supportive work environments and cultures of quality and collaboration. That’s why transforming the care delivery system is inseparable from payment reform. 

Our Solutions: 

Colorado’s Accountable Care Community (ACC) initiative, central to Medicaid reform, is designed to shift the state’s fee-for-service population into an accountable care model-- one in which regional care collaborative organizations (RCCOs) invest up front in primary care practices to support effective care management. This allows providers to deliver comprehensive, coordinated care. Primary care providers and RCCOs share incentive payments from the state to improve health outcomes. 

Under the ACC model, the state pays regional collaboratives to build networks of integrated care around primary care medical homes. It contracts with one RCCO in each of seven Colorado regions to create a network of primary care providers. The RCCO funds and supports care management and administration, helps practices coordinate care for Medicaid clients and works to better integrate primary care with behavioral health providers, hospitals, specialists and social services. The RCCOs and Medicaid contract with providers for comprehensive primary care and coordinate Medicaid member health needs across specialties.

In the Medicaid PRIME pilot program for the most vulnerable Medicaid adult enrollees, RMHP will receive comprehensive, global payments structured as follows:

  • Primary Care: RMHP will implement global payments for primary care providers who agree to 1) fulfill rigorous comprehensive primary care model objectives, and 2) accept Medicaid patients. Enhancements beyond Medicaid funding will be applied on a risk-adjusted basis. Additional quality incentives will be made available, independently from utilization and cost objectives.
  • Specialty Care: Specialty care payments will be reformed and enhanced for the Medicaid Prime population. Enhanced funding will be applied to ensure access for this population, and new, non-encounter based payments (e.g., population, case, episode and referral management) will be developed and implemented.
  • Mental Health: Mental health center providers will continue to receive full risk capitation directly from the state under their behavioral health organization agreement. However, they will participate in community interventions, share in gains for positive financial outcomes and will likewise be accountable for cost targets.

Cost trend improvements below the projected community budget will be shared among the state, RMHP, primary and mental health partners.

CPC+ is an advanced primary care medical home model that rewards value and quality by offering an innovative payment structure to support delivery of comprehensive primary care. The model will contribute to the Administration’s goals of having 50 percent of all Medicare fee-for-service payments made via alternative payment models (APMs) by 2018. The model offers two tracks with different care delivery requirements and payment methodologies to meet the diverse needs of primary care practices.

CPC+ practices will receive a risk-adjusted, prospective, monthly care management fee (CMF) for their attributed Medicare fee-for-service patients. Practices will use this enhanced, non-visit-based compensation to augment staffing and training in support of population health management and care coordination.

Both tracks will prospectively pay and retrospectively reconcile a performance-based incentive payment based (PBIP) on how well the practice performs on patient experience measures, clinical quality measures, and utilization measures that drive total cost of care.

Track 2 practices will also continue to bill as usual, but the FFS payment for evaluation and management services will be reduced to account for CMS shifting a portion of Medicare FFS payments into Comprehensive Primary Care Payments (CPCP), which will be paid in a lump sum on a quarterly basis without a claim.