Medicare’s Value-Based Effort Will Include Specialists

Direct provider contracting will reach beyond primary care in encouraging global capitated payment systems.

Total spending on a patient often involves accounting for more than primary care physician (PCP) services, Joshua M. Liao, MD, and Amol S. Navathe, MD, point out over on the Health Affairs blog this morning. CMS plans to launch a direct provider contracting (DPC) model in January 2020.  

One of the DPC participation paths focuses on capitated payments specifically for enhanced primary care, but two other options are not limited to PCPs, write Liao and Navathe. Specialists may also participate. ACOs (many of which employ global capitated payments) for the most part focus on primary or ambulatory care. This leaves out, for instance, surgery, which can account for up to 30% of the total cost of care for a patient, they write.

Liao is the associate medical director for contracting and value-based care at UW Medicine. Navathe is an assistant professor of health policy and medicine at the University of Pennsylvania.

Liao and Navathe write that “the ability for DPC models to engage more medical and surgical specialists in payment reform—and in turn increase the number of patients receiving care under it—raises the stakes of payment reform. This includes the potential impact of unintended effects under APMs.”

Those unintended effects might include the widening of health care disparities due to providers cherry picking healthier patients who can be managed for less money, and “market consolidation as larger groups of clinicians and organizations join forces under new DPC models, with potential spillovers that affect prices in other market segments (for example, commercial insurance markets).”