—Via CMS, WASHINGTON, D.C. (November 11, 2016)—We’ve discussed a number of times how our country’s health care system historically invested far more in treating sickness than maintaining health. This imbalance contributes to more spending on institutions, hospitals and nursing homes, rather than keeping people healthy at home and in their communities.
By better valuing primary care, care coordination and prevention, we help people access the services they need to stay well. In addition to keeping people healthy, health care costs are often lower when people have a primary care provider and team of doctors and clinicians overseeing and coordinating their care. And efforts to reduce documentation burden in care management and coordination, tied in with our strategy of physician and clinician engagement, helps keep the focus on patient care that pays for what works and better supports and engages the medical community.
That’s why Medicare and Medicaid, with invaluable support from the CMS Innovation Center, have implemented policies to sharpen their focuses on individuals and their care. Continuing that work, today, Medicare is finalizing policies that improve how it pays for primary care, care coordination, and mental health care, and expanding an exciting CMS Innovation Center payment and service delivery model that aims to prevent diabetes.
Preventing Diabetes & Protecting the Medicare Trust Fund
About 26 percent of people 65 years or older—more than 11 million people—have diabetes. They face higher risks of debilitating complications such as heart disease, kidney failure, limb amputations and blindness. And the treatment of people with diabetes is expensive. It costs Medicare more to support care for those with diabetes than those without diabetes. In total, we estimate that Medicare will spend $42 billion more in the single year of 2016 on fee-for-service, non-dual eligible, over age 65 beneficiaries with diabetes than it would spend if those beneficiaries did not have diabetes—$20 billion more for Part A, $17 billion more for Part B and $5 billion more for Part D.
On a per-beneficiary basis, this disparity is just as clear. In 2016 alone, Medicare will spend an estimated $1,500 more on Part D prescription drugs, $3,100 more for hospital and facility services and $2,700 more in physician and other clinical services for those with diabetes than those without diabetes. That’s approximately $7,300 or 86 percent more per beneficiary, per year for someone with diabetes. This increased spending reflects only Medicare’s share of costs; diabetic beneficiaries likely experience higher out-of-pocket spending as well. Taking care of people with diabetes is important, which is why Medicare provides quality services and support to those with diabetes.
But what if we could slow—or even reduce—the number of people developing diabetes in the first place? What if by focusing on primary care and prevention, we could help people live healthier lives while reducing the costs to the health system and beneficiaries.
The Diabetes Prevention Program model test set out to test this idea. Participants at high risk for developing diabetes were provided strategies to increase their physical activity, control their weight, and decrease their risk of type 2 diabetes. This model led to approximately 5 percent reduction in weight and saved Medicare an estimated $2,650 for each person enrolled in the Diabetes Prevention Program model test over a 15-month period, more than enough to cover the cost of the program.
The Medicare Diabetes Prevention Program (MDPP) expanded model, set to begin in 2018, hopes to make these services available to all eligible Medicare beneficiaries, improving their health and that of the Medicare program both now and in the future. We know that fewer people with diabetes saves patients and Medicare money because they use fewer expensive prescription drugs and have fewer hospital visits. And most importantly, by preventing diabetes, patients and families across the country can avoid suffering from a debilitating disease. That’s why we are expanding the model to make MDPP services available to all eligible Medicare beneficiaries.
The Medicare Diabetes Prevention Program expanded model is the latest successful effort at the Innovation Center to inform the evolution of the Medicare program over time. Other Innovation Center models have tested new ways for doctors and hospitals to work together to support and coordinate care for their patients and better patient safety. Models are eligible for expansion under Section 1115A(c) of the Social Security Act if they meet the following criteria: First, the Secretary of the Department of Health and Human Services determines that such expansion is expected to improve quality of patient care without increasing spending or reduce spending without reducing quality of patient care. Second, the independent CMS Chief Actuary must certify that the expanded model would reduce or not result in any increase in net program spending. Third, the HHS Secretary determines that such expansion will not deny or limit the coverage or provision of benefits Medicare beneficiaries receive. The Medicare Diabetes Prevention Program expanded model meets these criteria.
Refocusing Medicare on Primary Care and Behavioral Health
Also, Medicare announced an important set of changes that would improve how Medicare pays for primary care, care coordination and mental health care. These changes will result in an estimated $140 million in additional funding in 2017 to physicians and practitioners providing these services. Over time, if the clinicians qualified to provide these services were to fully provide these services to all eligible beneficiaries, the increase could be as much as $4 billion or more in additional support for care coordination and patient-centered care.
Clinicians will additionally be able to bill and be paid more appropriately when they spend more time with their patients, serving their patients’ needs outside of the office visit, and better coordinating care. These changes are designed to improve health outcomes. With today’s final primary care payment policies, Medicare continues to move toward a health care system that encourages teams of clinicians to work together and collaborate in order to provide more personalized care for their patients.
Geriatricians, internists, and family physicians provide core services for the Medicare program, including the kinds of care management and patient-centered care that are described by these new codes. Over time, we estimate that the payment increases attributable to these new codes could be as much as 30 and 37 percent respectively to these specialties.
We are also finalizing new coding and payment for care using the Psychiatric Collaborative Care Model that supports mental and behavioral health through a team-based, coordinated approach involving a psychiatric consultant, a behavioral health care manager, and the primary care clinician and which extends beyond the scope of an office visit. This care model has been shown to improve behavioral health outcomes for patients and save money. Payment for care using this model will help address one of the health system’s major challenges—access for behavioral and mental health care. For anyone who has struggled to gain access to behavioral health care for themselves or a loved one, the importance of these services cannot be overestimated.
Strengthening Primary Care beyond Medicare
As more people age into the Medicare program, we know that access to primary care is an essential tool for their health and wellbeing. We know that effective primary care, care coordination and planning, mental health care, substance use disorder treatment, and care for patients with cognitive and functional impairments can improve outcomes and result in smarter spending. Today’s changes are part of CMS’s broader goal to improve how we pay for care, including through our recently announced Quality Payment Program for Medicare physicians.
We expect to see the impact of these policies far beyond Medicare beneficiaries and hope that they will help strengthen the fabric of primary care throughout the country.
—Andy Slavitt, Acting Administrator, CMS and Patrick Conway, MD, MSc, CMS Acting Principal Deputy Administrator and Chief Medical Officer
Visit cms.gov for more information.