June 14, 2024: Medicare Payment Reform Advocacy Update

In a comment letter (PDF) responding to the 2025 Hospital Inpatient Prospective Payment System for Acute Care Hospitals (IPPS) proposed rule, the AMA: 

• Recognizes the efforts of the Centers for Medicare & Medicaid Services (CMS) in advancing health care technology through the Promoting Interoperability program. However, the AMA expresses concerns regarding the proposed changes to the certified electronic health record technology definitions and recommends that CMS delay these changes until after the finalization of the related Disincentives Rule, ensuring that physicians are not unfairly penalized and have adequate time to adapt to new requirements. 
• Supports the inclusion of new quality measures that enhance patient care and safety. However, the AMA cautions against the rapid implementation of these measures without robust evidence linking them to improved patient outcomes and recommends a phased approach that allows for comprehensive evaluation and adjustment based on real-world data. This method ensures that the measures enhance rather than complicate the care process, avoiding unnecessary increases in administrative burdens. 
• Applauds the administration for its commitment to reducing maternal health disparities and improving maternal health outcomes during pregnancy, childbirth and in the postpartum period. In response to two requests for information, the AMA makes several recommendations to improve maternal health, including promoting home monitoring of hypertension during the postpartum period and removing all barriers to treatment for opioid use disorder. However, the AMA urges CMS not to move forward with proposing a condition of participation related to labor and delivery in the forthcoming 2025 hospital outpatient proposed rule due to the potential unintended consequences of additional closures of labor and delivery units.  
• Supports the allocation of graduate medical education slots to be strategically targeted to address the most pressing needs within the health care system, including the shortage of psychiatrists. The AMA urges CMS to adopt a distribution framework that considers the specific needs of communities and the capacity of institutions to provide high-quality education and training to residents. 

As part of its recent inpatient hospital proposed rule, CMS is proposing the Transforming Episode Accountability Model (TEAM), a bundled episode model that would apply to five types of surgical procedures and would be mandatory for hospitals in about 100 metropolitan and 135 micropolitan areas. In a comment letter (PDF) on the proposal, the AMA identified several major problems with the current TEAM design and urged CMS not to finalize the TEAM program as proposed. 

The AMA is concerned that, if implemented as proposed, TEAM could lead to patient harms and exacerbate health inequities while failing to support improvements in care delivery. For example, participating hospitals could face financial penalties for discharging patients to post-acute care settings that can best address their rehabilitation needs. In addition, hospitals could try to reduce their average post-acute care expenditures under TEAM by avoiding patients with higher-than-average needs for post-acute care or higher-than-average risks for post-surgical complications or hospital readmission. The TEAM proposal also would not exempt small rural and safety net hospitals from this mandatory model, despite evidence that these kinds of hospitals have been disproportionately penalized in other CMS pay-for-performance and risk-based payment programs. 

AMA comments also addressed one voluntary element of the proposal, the collection and submission of data to CMS on greenhouse gas emissions, for which CMS would provide technical assistance to help hospitals transition to lower-emission approaches. The AMA reinforced its support for CMS efforts to promote decarbonization but recommends that CMS support decarbonization initiatives at all hospitals, not just those participating in TEAM. Comments also noted that the AMA does not support modifying hospital or physician quality scores based on whether they report greenhouse gas emission information, particularly as the quality measurement system proposed for TEAM is already inadequate to protect patients in the face of significant downside financial risk. 

On May 30, CMS released the request for applications (RFA) (PDF) for its new ACO Primary Care FLEX Model, which is a voluntary five-year model that will operate within the Medicare Shared Savings Program (MSSP) and provide a one-time advanced shared savings payment of $250,000 along with monthly prospective primary care population-based payments. Applicants must first apply to the MSSP by June 17 then submit a supplemental ACO PC Flex application questionnaire by Aug. 1, 2024. CMS will accept up to 130 ACOs classified as “low-revenue” into the model. For more information and to apply, visit the ACO PC FLEX Model webpage.   

CMS also announced it will accept a second cohort of applicants for a revamped Enhancing Oncology Model featuring several notable changes, including a higher monthly payment for enhanced services and higher spending threshold for recoupment. These changes will go into effect Jan. 1, 2024, for all participants, including those already enrolled in the model. Applications will open July 1 and end Sept. 16, 2024. More information can be found in the RFA (PDF). 

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