Direct-Contracting Entities Figuring Out How to Capitalize on Competitive Advantage

A delay in the Global and Professional Direct Contracting Model by the Biden administration has put the already-accepted direct-contracting entities (DCEs) in a coveted position.

New entrants are no longer being accepted for participation in the model while the Centers for Medicare & Medicaid Services (CMS) and its innovation arm review the details.

That gives 53 chosen organizations a leg up — for now. 


Those DCEs officially kicked off direct contracting with the federal government on April 1, while other eager health care providers continue to wait for further guidance.

Joel Theisen — the CEO of the Minnesota-based holistic senior care company Lifesprk, one of those 53 DCEs — said he feels like he has a “golden ticket.” He’s also generally disappointed with the pause because it could mean a delay in the trend toward value-based care overall.

That won’t stop Lifesprk from reaping the benefits of the position it’s in, however.


“Yeah, it does give us a [competitive advantage], and here’s why: in Minnesota, for instance, if anyone wants to work within direct contracting, they’re going to have to work with us,” Theisen told Home Health Care News. “And so, given that we’re the only one that will have this portal to this program — and this isn’t for sure, we’re still learning — it could be a huge advantage for Lifesprk to be a convener and to help other entities still connect to the program.”

In other words, for now, if any other companies in Minnesota want to get involved with direct contracting while the federal government has put the model on pause, they’ll have to go through the only active DCE in the state: Lifesprk.

As Lifesprk thinks about how it could improve its network, it’ll have opportunities to add to it solely based on the fact it has been accepted to the Global and Professional Direct Contracting Model.

“We’re really big on partnerships already. We believe strongly that isolation is fatal,” Theisen said. “Our whole enterprise is built on what we call a high-performance network, where we bring a lot of these home- and community-based entities together to enhance client experience through these deep relationships … and toward a value-based world.”

Lifesprk’s participation in the program, which was originally announced in 2019 under the Trump administration, now means more than it would have if the CMS Innovation Center continued taking applicants.

“we have a real opportunity here,” Theisen said. “We’re really bullish on this. We just have to make some of the decisions on what we’re going to do exactly with DCE. But on that list of 53, I think maybe there’s only one or two other home- and community-based providers.”

Theisen’s expectations for the benefits of involvement as the model stands today aren’t unfounded.

Tyler Cromer, a principal for the Washington, D.C.-based research and advisory firm ATI Advisory, believes the same. It’s an unintended consequence of a delay that is likely just due to precaution and review — but it’s a consequence nonetheless.

“It’s sort of like those organizations are grandfathered in,” Cromer told HHCN. “And so I do potentially see it being an advantage for those providers.”

This, of course, presumes that CMMI does not open another application period in the near-term. But even if it does, there could be major or minor modifications made to the model.

Either way, home-based care insiders and providers are hoping that this administration does not take a step back and de-emphasize the importance of value-based care solutions.

“I really hope that there’s a very strong option [no matter what happens],” Cromer said. “Especially for the high needs population — I do think that that is a gap in the CMMI portfolio.”

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