A Deeper Dive into Primary Care First, Where Hospice Fits

Though new payment models under the auspices of Medicare’s new Primary Care First initiative are designed for primary care providers, hospice and palliative care providers have a role to play.

The U.S. Centers for Medicare & Medicaid Services (CMS) in April announced that they would implement Primary Care First in phases beginning in Jan. 2020, initially in 26 regions throughout the United States. Hospices and palliative care organizations are eligible to participate in the payment models provided they meet the program’s criteria. The program is designed to control costs, reduce avoidable hospitalizations and improve care coordination.

Eligible providers can choose to participate in one or both of two payment options under the program: A general payment option and a Seriously Ill Population payment option designed to serve patients with complex, chronic needs, through which providers focused on caring for that population would receive increased payments.


“CMS wants to strengthen primary care. There is no one move that would create savings more quickly than incentivizing primary care practices to share in more of the responsibility and share in more of the payment for taking care of patients within the practice,” Brad Stuart, M.D., chief medical officer at the Coalition to Transform Advanced Care, told Hospice News. “What they haven’t said out loud yet is that they would love to see primary care do more and not refer every single patient with heart failure to a cardiologist, for instance.”

Hospices and palliative care practitioners will be able to receive payments through Primary Care First’s general payment option if they meet the programs eligibility requirements. They can also participate exclusively in the Seriously Ill Population payment option, either directly as an organization or by partnering with a primary care practice.

Participating health care providers would also receive a bonus for reducing avoidable hospitalizations, an area in which community-based hospice and palliative care providers have a strong track record. A growing body of research indicates that hospice and palliative care reduces hospitalizations as well as hospital readmissions.


Development of the models was informed by research and proposals by a number of health care stakeholders, including the American Academy of Hospice, the Coalition to Transform Advanced Care, and Sacramento, Calif.-based health system Sutter Health, who received a $13 million grant to study clinical and financial systems for serious illness care through a program called the Advanced Illness Management Model (AIM). The three organizations made proposals to CMS’ Center for Medicare & Medicaid Innovation (CMMI) for new payment models.

“[CMMI] was excited about the three proposals and asked that we collaborate and offer advice and recommendations,” Stuart said. “CMMI then behind closed doors devised how they were going to handle the new payments, and they happened to come up under the rubric of Primary Care First.”

Stuart and co-authors outlined the AIM program in a Health Affairs study published earlier this month. Through the program, Sutter Health provided home-based coordinated care to 2,000 patients with advanced illness per day in 19 communities in a mix of urban, suburban and rural locales.

Compared to matched Medicare beneficiaries in similar regions, AIM cut the number of hospital days by 1,361 per 1,000 patients. The number of patients who died in the hospital fell by more than 8% and reduced inpatient costs by $6,127 per patient and overall health care costs by $5,657.

Beneficiaries with advanced illness, defined as late-stage chronic illness that threatens health and the patient’s ability to function, represent 4% of Medicare beneficiaries but account for 25% of its costs, according to the Sutter Health study. These patients, who often reach a point where treatments begin to lose their impact, frequently experience avoidable hospitalizations close to the end of life.

Though stakeholders have expressed optimism about primary care first, a number have expressed concerns about payment amounts.

“The payment is not generous. There is a $325 payment [in the Serious Illness Population Model] for the first visit to support the time and attention needed to do a comprehensive assessment at the beginning,” said Allison Silvers, vice president of payment and policy for the Center to Advance Palliative Care. “After that, there is $275 per member per month. Every time a billable clinician has an encounter with the patient there will be a $50 payment plus the performance adjustment. A detail that is lacking from CMS is what qualifies as an encounter. For example, does it have to be face to face?”

In the Serious Illness Population payment option, the performance adjustment would be a $50 per month adjustment up or down, contingent upon the provider’s performance.

The performance adjustment for the general payment option would include a bonus of as much as 50% of the provider’s total Primary Care First revenues if they hit targets on certain metrics. Providers who do not meet the performance metrics will be penalized 10% of those revenues.  

“I have a lot of friends and colleagues who think those numbers should be higher. I think they could be nudged up a bit and that would be a good step,” Stuart told Hospice News. “But I don’t think that just paying out more dollars is the answer. CMS needs to actively encourage collaboration. Close integration really between various organizations such as hospice and palliative care and primary care practices and hospitals.”

Care coordination, perhaps a first step towards system integration, is one of the stated goals of Primary Care First, according to CMS. This could represent an opportunity for hospice and palliative care providers.

While they have the option of participating in the program directly, hospice and palliative care providers could see success by leveraging their skills and experience in providing interdisciplinary, patient-centered care; reducing hospitalizations; and caring for seriously ill patients to form partnerships with other health care organizations.

“I think one of the most effective models would be one of shared cost savings where a palliative care organization collaborates not only with primary care providers but also with pertinent specialists, in particular oncology,” said Eric Bush, M.D, chief medical officer of Hospice of the Chesapeake. “If you had a payment mechanism where you compare those who are partnering with a palliative care organization versus other providers who may be trying to do the same type of care and show that partnering organizations achieve improved utilization, there should be cost savings that could be distributed to all parties involved. That’s the best win-win scenario.”

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