Hospital Impact: A look at two MACRA payment models dreamed up by doctors

Kent Bottles

No matter what happens to the Affordable Care Act, most believe that the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) will continue to change the way that Medicare pays physicians.

MACRA is a separate law from the ACA, and both the overwhelming support for MACRA in the House and the Senate and the lack of political will to revisit the Sustainable Growth Rate problem make it highly unlikely that Congress will repeal it. 

A little-discussed part of MACRA created the Physician Focused Payment Model Technical Advisory Committee (PTAC) to encourage the development of Physician Focused Payment Models (PFPM). Congress envisioned PFPMs would enable a "bottom-up" approach in which physicians could design payment models that support high-quality, low-cost care that is also patient-centered. 

The MACRA final rule published on Nov. 4, 2016, established criteria for PFPMs. These criteria include value over volume, flexibility, quality and cost, scope, ability to be evaluated, integration and care coordination, and use of health information technology.

For the first time, PTAC has recommended to Department of Health and Human Services Secretary Tom Price that two new PFPMs should be tested in Medicare. The two proposals are Project Sonar and the ACS-Brandeis Alternative Payment Model. 

Project Sonar (PDF), a pilot project designed by Dr. Lawrence Kosinski and tested by Blue Cross Blue Shield of Illinois, has shown that inflammatory bowel disease patients can receive better care at a lower cost by using a PFPM. Project Sonar:

  • Received its name because the doctors “ping” patients with proactive contacts to identify problems that could lead to costly hospitalizations
  • Provides a payment mechanism not available in fee-for-service systems so that physicians can be compensated for proactive contacts with patients
  • Uses evidence-based guidelines embedded in the electronic medical record
  • Uses a team-based approach
  • Employs patient risk assessment by a set of biopsychosocial measures

The ACS-Brandeis Alternative Payment Model (PDF) does not focus on one disease; rather, it concentrates on episodes of care: This model:

  • Identifies teams of physicians called Clinical Affinity Groups
  • Ties payment to patients’ clinical outcomes
  • Describes how payment will be divided between physicians who manage the disease and physicians who perform procedures like surgery
  • Uses detailed risk contracts with CMS for specific disease entities

Project Sonar and the ACS-Brandeis Alternative Payment Model are the first PFPMs evaluated by the PTAC and recommended for adoption by the Centers for Medicare & Medicaid Services. There are many other proposals being studied by the PTAC, and the public can participate in the process by commenting to the committee.

More information about PTAC and copies of all of the proposals and letters of intent that have been submitted to date are available on the PTAC website. Plus, anyone can also receive email updates on the PTAC work through the PTAC email listserve, and PTAC is on Twitter @PFPMTAC.

Many in the hospital and physician community have criticized MACRA as unworkable and onerous for providers. But the PTAC process of evaluating PFPMs provides a mechanism for the provider community to propose better ways for CMS to pay physicians.

It will also be interesting to see how supportive Price is of these innovative, “bottom-up” approaches to compensating physicians for value-based care. 

Kent Bottles, M.D., is a lecturer at the Thomas Jefferson University School of Population Health and chief medical officer of PYA Analytics.