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The Center for Medicare and Medicaid Innovation (CMMI) announced its new strategy in response to United States Secretary of Health and Human Services Robert F. Kennedy Jr.’s call to “Make America Healthy Again” on Tuesday.
The announcement was light on details but appears favorable in terms of prioritizing more at-home care. However, federal officials also indicated that providers will have fewer options for participating in payment and care models without taking on financial risk. And with the spectre of other major changes related to the federal budget that is working its way through Congress, the CMMI announcement adds another layer of uncertainty for at-home care providers as they try to strategize for the future.
When asked on the webinar when stakeholders can expect details regarding new and existing models, CMMI’s director, Abe Sutton, said to “stay tuned” over the coming months.
Still, I feel confident that at-home care providers can expect to have a strong place in CMS Administrator Dr. Mehmet Oz’s new vision for CMMI. Oz spoke specifically about provider care for older adults in his brief opening remarks on the webinar.
“Great societies protect their most vulnerable, and we’re a great people, so we’re going to do just that,” Oz said. “Alongside partners like you, [the Centers for Medicare & Medicaid Services] (CMS) is going to provide Americans access to excellent care, especially those who need our help the most: disadvantaged youth, those with disabilities and our seniors.”
Sutton spoke several times about increasing patients’ time at home and allowing them to choose their care site. The power of choice was a regular refrain in the materials released about CMMI’s new strategy, and that, coupled with Kennedy’s focus on preventing chronic disease and lowering costs, will put in-home care at the center of this new era of government-reimbursed health care.
In this week’s exclusive, members-only HHCN+ Update, I review what we know about the CMMI’s new approach and how it could impact the home-based care community, and I offer analysis and key takeaways, including:
– Why CMMI’s emphasis on choice is heartening for the in-home care industry
– That risk for home-based care providers engaging in CMMI models may increase
Increasing site of care flexibility
The HHS’ focus on driving personal choice (as seen in how Kennedy discusses vaccines) and lowering costs lends itself directly to what home-based care providers have been saying for decades, that in-home care is affordable and the general preference of aging people.
The new CMMI strategy repeatedly mentions increasing flexibility for patients to receive care in the setting of their choice, including “virtual, digital in nature, at an office, or provided in the home.”
To achieve this aim, models can require site-neutral payments across settings, which CMMI officials said would reduce costs and reinvest hospital capacity into outpatient and community-based care, facilitated through changes to certificate of need requirements.
To give patients more options for care, Sutton said CMMI would engage independent and rural practices to participate in CMMI models and enable home-based care. This would drive competition, according to the Innovation Center, and drive down costs.
“We will give patients more options for care and more opportunities to benefit from a health care system that incentivizes high-quality care,” Sutton said. “This involves engaging new provider types that have not traditionally stepped forward to participate in our models, such as independent and rural practices, to participate in innovation center models and enable home-based care.”
The focus on expanding innovation models, specifically with a focus on rural provider participation, could potentially help meet the growing demand for services in these areas where home health growth has been particularly robust in recent years.
The number of people aged 65 and older in non-metro counties grew from 7.4 million in 2010 to 9.7 million in 2023, according to a study published by the U.S. Department of Agriculture’s (USDA) Economic Research Service (ERS). Meanwhile, the number of home health organizations serving these areas also has grown, with 36% more organizations active in Q3 2023 compared to Q1 2010.
However, as HHCN’s Audrie Martin recently reported, there are a slew of challenges in providing high-quality and consistently accessible care to rural populations. Expanding value-based care models in these markets could be a way to address these challenges, notably by incentivizing and enabling more whole-person care, Dr. Binoy Singh, chief medical officer at Gentiva, told Home Health Care News.
In particular, Singh noted the importance of addressing patients’ social determinants of health, some of which can be of particular concern in rural areas. For instance, transportation options are not as plentiful as in metropolitan areas, and people living in rural areas often have to travel significant distances to receive care. To the extent that value-based care models often prioritize social determinants of health and offer pathways to meeting these needs, the expansion of such models in rural areas could be a boon.
Yet, I can’t see how other huge challenges in rural markets – notably acute health care worker shortages – will be meaningfully addressed through the implementation of more CMMI models. However, I hope that the CMMI push to address these areas might compel Congress or CMS to marshal additional resources and launch new initiatives that would help address the ever-deepening workforce crisis.
In light of the lean rural workforce (and the transportation challenges in these areas), telehealth is an especially crucial tool for providers in these markets. I hope and believe that the CMMI strategy adds even more pressure for a permanent expansion of telehealth flexibilities, versus the temporary extensions of the Covid-era waivers that – while welcome – make it difficult for providers to invest deeply and confidently in this type of technology, given the uncertainty about future telehealth policy.
Along with seeking to provide patients with more flexibility when determining their preferred care pathway, the new strategy could also offer providers increased flexibility through new waivers.
One example of a new waiver is reduced cost-sharing for high-value or preventative services and payments to caregivers to better support those experiencing cognitive or functional decline. This example could be meaningful for home-based care providers offering specialized dementia care.
Already, some at-home care providers have engaged in the Guiding an Improved Dementia Experience (GUIDE) model, which aims to incentivize more integrated services. Earlier this month, we reported on early success stories with this model. Clearly, this population is one that remains of particular concern to CMMI, which makes sense given the high costs that dementia care incurs on the health system. Amid all the current uncertainty, a focus on developing programs that specifically serve the needs of people who have Alzheimer’s or another cognitive condition appears to be a safe, smart move for at-home care providers.
And that goes for all types of at-home care providers, including Medicare-certified agencies, Medicaid-certified personal care companies, and even agencies that primarily offer private-pay home care services. This is because CMMI is pledging to cast a wide net with its efforts, and programs like GUIDE already are encouraging the involvement of community health providers that may not be under the official umbrella of Medicare and Medicaid.
“We plan to update existing and design new Original Medicare models to leverage payments and regulatory flexibilities such as waivers and beneficiary enhancements for incentives,” Sutton said. “We’re going to expand our work to test improvements in Medicare Advantage and Medicaid.”
Increasing standards to prove cost effectiveness
Not surprisingly under an administration known for its chainsaw-like approach to cutting costs, the CMMI’s new strategy includes a focus on saving taxpayer dollars.
In pursuit of shifting financial risk from taxpayers, CMMI indicated that it may require providers to put more skin in the CMMI game.
“Aligning to our statutory mandate, [we will] work to ensure that our model tests reduce costs and have a pathway to scale into permanent Medicare, Medicaid and CHIP programs,” Sutton said. “We will accomplish this, for instance, by strengthening model design, requiring downside risk, prioritizing high-value care services and reducing low-value care.”
Specifically, reviews of existing and new models could require that all alternative payment models involve downside risk and require an increasing number of Medicare and Medicaid beneficiaries be in global downside risk arrangements. They could also require that providers bear some financial risk, that conveners not bear all financial risk, and downplay the government’s hand in rate-setting.
Taking on risk can drive substantial benefits, including margin expansion, for home-based care providers that are sophisticated enough to meet the demands of these models. However, CMMI’s move to require downside risk seems to me to be at odds with the agency’s focus on enabling more rural and independent provider participation in new payment models. These providers are more likely to lack the technology, operational sophistication and financial flexibility that can enable successful participation in risk-based models. With this in mind, I’m eager to see what moves CMMI makes first in trying to achieve this financial risk goal, and curious just how much risk providers will be asked to bear.
The effort certainly could be helped by CMMI’s strategy to support independent providers and new entrants in the health care space and make model participation “less burdensome.” To do so, CMMI models might expand the use of advanced shared savings and prospective payments, according to the Innovation Center.
It remains to be seen whether CMMI’s changes would lower providers’ burden to participate in its models. And the devil certainly will be in the as-yet uncertain details – at-home care providers may face additional competition from the Innovation Center’s aforementioned plans to promote choice. I’ll be watching closely to see if the risk/benefit analysis works out for in-home care providers, and which types of providers can benefit.
While I imagine large providers currently operating under some value-based care agreements will be well-positioned to benefit from downside risk arrangements, smaller players may struggle to make the necessary up-front investments to navigate the waters of downside risk safely.
Existing programs
Significant changes to CMMI brought to mind questions about successful CMMI models that have the most benefit for home-based care providers.
Namely, the Home Health Value-Based Purchasing (HHVBP) Model, which CMS reports has an average annual savings of $141 million. The program also benefits home health agencies. Changing such a cost-saving program would be shocking in the face of CMS’ stated plan to save taxpayer dollars – but I was curious if the program would get caught up in the agency’s plans for change.
HHVBP is unlikely to go anywhere soon. Fred Bentley, managing director in ATI Advisory’s care continuum strategy and solutions practice, previously told HHCN.
CMMI’s new strategy could implicate other programs, however.
“Will they make the hospital-at-home demonstration program permanent?” Bentley said. “That’s still up in the air. That also requires legislation, but CMMI can still push on hospital-at-home. There has been interest in creating a [skilled nursing facility] (SNF) at home model. I don’t want to overstate that, all of a sudden, that of SNF business is going to leave the skilled nursing facility and go to … home-based care settings. But, there could be an experiment there and a push on that.”
Bentley’s question also supports the idea that opportunities for home-based care could increase under the “Make America Healthy Again” strategy. I hope that CMMI’s focus on choice, competition and increasing standards results in better access to high-quality, in-home care, but I’ll also be anxious to see which providers thrive under the new regime.
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