Many practices participating in the Centers for Medicare & Medicaid Services’ Primary Care First model reported that capitated payments provided greater flexibility for practitioners, with some also reporting that capitated payments provided more stability and reliability than fee-for-service payments, according to the Year 2 evaluation study recently released by Mathematica.
Launched in 2021, Primary Care First is testing a voluntary, alternative payment model that aims to improve care for Medicare beneficiaries and lower costs by strengthening primary care delivery. The model offers capitated payments and a flat visit fee, and the opportunity for substantial performance-based adjustments if practices meet quality and cost targets. The second year of the model began the performance-based adjustments and payment accuracy adjustments, which were designed to prevent CMS from paying twice for primary care services provided outside of participating practices.
Practices received on average $235,523 in capitated payments and about $100 in flat visit fees per beneficiary in 2022—a combined amount estimated to be greater than what they would have received under Medicare fee-for-service, even after accounting for the payment accuracy adjustment. However, in interviews conducted as part of the evaluation, practices said that model payments were inadequate to support care delivery transformation.
About 15 percent of practices have left Primary Care First since its launch, primarily due to the opportunity to join the ACO REACH Model and concerns with the payment accuracy adjustments. Despite concerns, most practices did not plan to make changes to improve their payment accuracy adjustments.
Among other key findings, Mathematica found that, as expected this early in the model, Primary Care First had minimal effects on hospitalizations and Medicare expenditures over the first two performance years. Acute hospitalizations did not change, and Medicare Part A and B expenditures grew by an estimated 1.5 percent relative to a comparison group.
In Year 2, participating practices continued to make changes that they believed would strengthen primary care and reduce hospitalizations. These changes mostly focused on care management, comprehensiveness, and coordination. They also made changes related to integrating behavioral health, addressing health-related social needs, and coordinating care with medical specialists.
Many of the practices had prior experience with primary care transformation and chose to make changes to existing activities. In addition, most practices (83 percent) were affiliated with larger health care organizations that influenced decisions about care delivery changes.
Learn more about Mathematica’s evaluation of Primary Care First and explore the findings in the full report and the Findings at a Glance summary.
Contact
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Christal Stone Valenzano
cstone@mathematica-mpr.com
202-250-3520
