Overcoming the Barriers to Value-Based Payment in Primary Care

February 05, 2024 - Primary care is arguably the most critical component of our healthcare system. Primary care and preventive medicine can help avert and manage chronic diseases and prevent long-term complications.

However, efforts to improve primary care delivery, such as value-based payment models, are lacking. That’s not to say that the industry doesn’t understand the importance of value-based care when it comes to primary care, though.

Prioritizing primary care can not only help improve patients’ overall well-being, but it can also redirect spending away from expensive specialty care that can be avoided when preventive visits are a regular occurrence. When these preventive visits are delivered under a value-based payment model, patients are more likely to experience quality care at lower costs.

Although stakeholders are pressuring payers and providers alike to transition from fee-for-service to value-based models, it’s easier said than done. A lack of infrastructure, insufficient staff, and confusing quality metrics are some of the barriers keeping providers from participating in value-based care. However, external support and, more importantly, upfront costs could solve these challenges.

The importance of value-based payment for primary care 

Comprehensive primary care often requires additional resources, including brief virtual or over-the-phone check-ins. But the standard fee-for-service model generally will not reimburse physicians for these services that do not require in-person visits.

“When we have these value-based payment models that are paying for episodes of care and chronic disease management, we can utilize additional resources in our offices and technologies to help make those strides with the patients and still have the resources to do that because we’re getting a payment model that focuses on outcomes and not just on face-to-face visits,” Sarah Sams, MD, FAAFP, a family physician and a member of the American Academy of Family Physician’s (AAFP) Board of Directors, told RevCycleIntelligence.

Value-based payment models incentivize providers to improve patient outcomes, including better chronic care management and equitable care across different populations.

“I think of it as avoiding unnecessary and expensive specialists and hospital visits to enhance affordability for patients,” Ann Greiner, CEO of the Primary Care Collaborative (PCC), shared. “If we were incenting for those outcomes, as opposed to incenting for volume, primary care is in the catbird seat, and primary care delivers those outcomes.”

“That’s why Medicare Advantage plans and primary care-led accountable care organizations put primary care at the center—because they are incented to deliver on those outcomes.”

Although primary care is key to holistic health, the healthcare industry does not spend nearly enough on these services.

“Access to primary care is associated with improved patient outcomes, increased equity, and lower mortality/higher life expectancy at similar or lower total costs,” a CMS spokesperson told RevCycleIntelligence. “Despite these well-documented benefits, primary care spending remains low as a proportion of total health care spending, gaps in payment between primary care and specialist care persist, and fewer people report a regular source of primary care, particularly among underserved populations.”

According to Greiner, total healthcare spending on primary care is less than 5 percent. Primary care physicians are being told to address mental health needs and substance use disorders, improve maternal care, and manage chronic conditions, all for less than five cents on the dollar.

What’s preventing value-based primary care 

Value-based primary care models cannot deliver cost and quality outcomes if practices do not participate. Implementing or joining a value-based payment model requires substantial resources and infrastructure—things not all primary care practices can shoulder financially.

“A lot of [practices] can’t afford to implement the technology or hire the additional staff that it takes to monitor the metrics and do the upfront work to get the outcomes we’re looking for in value-based care,” Sams said. “If it is a cost-sharing model, they don’t see those benefits until after they’ve put the work in, and to put the work in, they have to have the staff or the technology or both.”

In addition, value-based metrics proposed by health plans can be confusing for physicians or may differ across plans. Providers may run into administrative hurdles when trying to implement strategies to address different measures for each patient depending on their health plan, Sams explained.

A lack of value-based primary care models to choose from also does not help boost participation.

“There’s not enough of these kinds of models for primary care [practices] to participate in,” Greiner said. “In the commercial sector, it’s very hard. There aren’t a lot that are being offered by health plans for those providing employer-sponsored healthcare. That’s more than half of the population right there. There are a few Medicare models, but not enough. And the same is true for Medicaid. We need more models.”

Models from the CMS Innovation Center that focus on primary care include the Primary Care First Model, Making Care Primary (MCP) Model, Advancing All-Payer Health Equity Approaches and Development (AHEAD) Model, and ACO Realizing Equity, Access, and Community Health (ACO REACH) Model.

The Primary Care First Model is a five-year payment model that builds on the principles of the Comprehensive Primary Care Plus (CPC+) model and focuses on five comprehensive primary care functions: access and continuity, care management, comprehensiveness and coordination, patient and caregiver engagement, and planned care and population health.

CMS launched the five-year CPC+ model in 2017. Like all value-based care models, CPC+ aimed to lower costs and improve the quality of primary care delivery. However, a study found that the model was not associated with reduced Medicare expenditures. In addition, the model was not tied to any significant changes in readmissions, unplanned acute care, use of low-value services, or comprehensiveness of primary care.

The model was associated with reduced emergency department visits, acute hospitalizations, and acute inpatient expenditures, though.

“All CMS models are evaluated for their ability to reduce spending while maintaining the quality of care, or improve the quality of care without increasing spending, and must not deny or limit the coverage or provision of any benefits and can be extended by the Secretary of Health & Human Services (HHS),” the CMS spokesperson stated.

“Every model that has been tested has yielded important policy and operational insights, helping to address not only continued challenges with health costs and quality of care but also the impacts of inequity and health disparities.”

Boosting participation in value-based models

Upfront costs would go a long way in improving how value-based care models operate and increasing provider participation.

“If we don’t provide the kind of upfront support that primary care practices need to successfully participate, we’re not going to make it possible for large swaths of the American public to be in these models that provide superior care,” Greiner indicated.

Upfront costs can also ensure practices have the adequate infrastructure and staff to successfully implement value-based payment models.

For example, Sams teaches at a residency program in Columbus, Ohio, that participated in the CPC+ model. Part of the CPC+ payments the program received helped them hire a full-time pharmacist who helps manage diabetic patients by conducting visits between physician visits.

Emphasizing the importance of value-based care is a little different for Sams in the residency program than it may be for physicians in primary care practices.

“Since we’re in a residency program, we need to try and make a case for why value-based payment is an important model for our residents to see so they’ll want to go out and look for opportunities for those cost savings and better patient outcomes in the practices that they join,” she explained.

“We also need to work with our physician employers to make sure that they are passing along cost savings or shared benefits with the physicians and not just paying them on an RVU basis because then the physician themselves is not incentivized to work through the value-based payment model to get those better outcomes.”

Because of the lack of standardization across providers and payers when it comes to value-based care models, it is essential for practices to base their strategies on their needs. Practices should use real-time data to understand how they’re doing compared to other organizations and identify which patients would benefit from outreach.

The future is value-based 

Shared savings models and hybrid payment models are two possible routes to success for primary care practices delivering value-based care.

According to Greiner, PCC members have seen positive outcomes by participating in the primary care-driven Medicare Shared Savings Program (MSSP) tracks, Medicare Advantage models, and direct primary care models.

PCC also founded the Better Health NOW campaign, which includes policies focusing on hybrid payment for primary care and more investment through those kinds of models.

AAFP is committed to creating stability within payment models so participants can see long-term benefits instead of just on a one-year basis.

“You don’t see the return on investment in a physician practice when the payments are limited to just a short period of time. You need to be able to see this improvement over time and we need to reduce those administrative burdens,” Sams said.

The shift from fee-for-service to value-based care is a significant transition, but the payoff will be worth it with the right models.

“Once primary care practices get a taste of [value-based care], they generally love it because you’re not on this rigid face-to-face visit that is very constrained in terms of the amount of time you can spend,” Greiner concluded. “You have a payment to manage a population and you can be more flexible with how you’re using your time.”