Healthcare Groups Plead with HHS’ Becerra to Retain Direct Contracting Model
A large group of 222 healthcare organizations, both national healthcare associations and provider organizations, including accountable care organizations (ACOs), sent a letter on Monday, February 14, to Health and Human Services Secretary Xavier Becerra, urging him not to cancel the Global and Professional Direct Contracting (GPDC) model, but instead make adjustments to it. Among the 222 organizations were the Los Angeles-based America’s Physician Groups (APG) and the Washington, D.C.-based NAACOS, the National Association of ACOs.
APG’s press release on the subject began thus: “America’s Physician Groups (APG) today, along with hundreds of other groups, urged HHS Secretary Xavier Becerra not to cancel the Global and Professional Direct Contracting (GPDC) model and instead make adjustments to the program. Killing the GPDC model would especially hurt underserved populations where the program has disproportionately more providers caring for patients.” And it quoted Don Crane, APG’s president and CEO, as stating that “The direct contracting program is good for patients, it’s good for providers, and it strengthens the Medicare program. Killing the direct contracting program at this stage is just bad policy,” Crane said. “It would not only hurt Medicare beneficiaries, it would undermine the important work of the CMS Innovation Center. In particular, many of the physicians in this model are now able to provide care to historically underserved communities where there are deep health disparities…why would we hurt this progress?”
NAACO’s press release began with the statement that, “In a letter delivered today, 222 organizations asked Health and Human Services Secretary Xavier Becerra to “fix, don’t end” the Direct Contracting Model. Supporters include prominent trade groups, like the National Association of ACOs, health systems, medical practices, Direct Contracting Entities (DCEs), ACOs, and others. The National Association of ACOs (NAACOS) understands Becerra and the White House are weighing the future of Direct Contracting, including the possibility of cancelling the program. Instead, policymakers should make necessary refinements to improve the model in support of patients and providers. Direct Contracting is currently the premier accountable care model from the CMS Innovation Center and seeks to build on the successful Next Generation ACO Model, while redesigning healthcare delivery and payment. Like other ACO models, participants have incentives to assure preventative services, manage complex chronic diseases, and coordinate care across multiple providers.”
“Cancelling Direct Contracting would additionally undermine the work of the Center for Medicare and Medicaid Innovation (Innovation Center) and the Centers for Medicare & Medicaid Services (CMS),” the letter states. “Rather than cancelling Direct Contracting, a better option is to adjust the model, which the CMS Innovation Center can quickly do. Fix, don’t end, the Direct Contracting Model.”
The NAACOS press release notes that “Fixes could include a rebranding and name change would also help communicate how this model is part of the evolution to accountable care, additional constraints on participation and enhanced patient protections. CMS could also make clear that the Geographic Direct Contracting Model, which is being confused with the very different Global and Professional options, is stopped entirely. Should Global and Professional Direct Contracting be abruptly ended, healthcare providers would be terminated from value-based payment participation without warning, making them far less likely to invest and participate in future CMS payment models.”
The letter from the 222 organizations to Secretary Becerra begins, “Dear Secretary Becerra:
The undersigned organizations write to urge you to not cancel the Global and Professional Direct Contracting Model (GPDC) and instead make necessary refinements to improve the model in support of patients and providers. Direct Contracting is an accountable care model for traditional Medicare. Stopping Direct Contracting is bad policy and would undermine our health system’s move to value-based payment models, which is sorely needed to achieve the triple aim of better patient satisfaction, higher quality care, and more affordable care. Traditional Medicare patients’ care would be worse off without the benefits and quality of care provided by Direct Contracting Entities (DCEs).”
What’s more, the 222 organizations state, “Canceling Direct Contracting would additionally undermine the work of the Center for Medicare and Medicaid Innovation (Innovation Center) and the Centers for Medicare & Medicaid Services (CMS). The Innovation Center was a critical part of the Affordable Care Act and is an instrument to test value-based payment models that make care more affordable while also improving quality of care. Much has been learned over its first decade of work. Should this model be abruptly ended, health care providers would be terminated from value-based payment participation without warning, making them far less likely to invest and participate in future CMS payment models. This would be particularly unfair for the dozens of Accountable Care Organizations (ACOs) that moved into Direct Contracting after the December 2021 conclusion of the Next Generation ACO Model, a successful provider-led payment model launched under then President Obama’s administration. The Innovation Center work and the shift to value-based care has been bipartisan and should remain that way.”
Indeed, the leaders of the 222 organizations write, “Rather than canceling Direct Contracting, a better option is to adjust the model, which the CMS Innovation Center can quickly do. Fix, don't end, the Direct Contracting Model. For example, CMS can limit participation to certain types of DCEs, such as provider-led DCEs, and place additional guardrails and add more beneficiary protections. A rebranding and name change would also help communicate how this model is part of the evolution to accountable care. There's still time to make these adjustments this year. The Innovation Center would also benefit from a public announcement that the Geographic Direct Contracting Model, which is being confused with the very different Global and Professional options, is stopped entirely. Many of the recent criticisms against the model are misleading and flat out false. Traditional Medicare patients maintain their freedom of choice to see any willing provider. They keep all of their rights and protections, and in fact, get more benefits and lower cost care through the model. There are no networks or prior authorization. DCEs must inform patients of their assignment to a DCE. This is not the end of traditional Medicare, as advocates have falsely claimed, but is a way to provide additional beneficiary and provider tools as part of a whole-person care approach,” the letter states.
“Furthermore,” it notes, “Direct Contracting is part of the CMS Innovation Center’s efforts to help underserved populations, a focus which should be built upon through program modifications. CMS officials have stated that DCEs have proportionately more providers in communities with high numbers of low-income and minority patients. The model in fact incentivizes care for sicker, high-needs patients. Lessons learned from the model could be applied to other payment models. Canceling Direct Contracting would hurt our health system’s efforts to address health disparities.”
And, as the NAACOS press release states, “The Next Generation ACO Model, on which Direct Contracting is based, has improved care and generated $1.7 billion in gross savings and $836 million in net savings to CMS between 2016 and 2020. ACOs overall have saved Medicare $13.3 billion in gross savings and $4.7 in net savings since 2012. Importantly, data show these ACOs continued to provide high-quality care and yield satisfied patients. Today, ACOs care for nearly 20 percent of all Medicare patients and nearly a third of traditional Medicare patients.”
The letter from the 222 healthcare groups came in response to a letter sent to Xavier Becerra and to CMS Administrator Chiquita Brooks-LaSure on January 5, by 54 members of Congress, under the signature of Pramila Jayapal (D.-Wash.), who serves as chair of the Congressional Progressive Caucus.
That letter began thus: “Thank you for your leadership in strengthening and protecting Medicare, our country’s crucial health plan for seniors. We appreciate that you have begun doing this by pausing the Geographic Direct Contracting Model for further review and that you have stopped accepting applications for the Global and Professional Direct Contracting Model for 2022. We write to ask that you take a step further by permanently ending the programs and coordinating the transition of traditional Medicare beneficiaries currently in these programs back into the traditional Medicare model by July 1, 2022. As you know, the previous administration started Direct Contracting Entities (DCEs), which are privately owned and controlled coverage networks in which for-profit companies are paid monthly to cover beneficiaries’ healthcare. Any funds left over after it covers care are kept as profits creating a perverse motive to decrease the quality and volume of seniors’ care. These models ultimately aim to privatize traditional Medicare by funneling beneficiaries, without their knowledge, into a DCE. Unfortunately for patients in these entities, DCEs are incentivized to funnel patients to providers within their networks to maximize profits which can limit patients’ care options. These models transform the care of a traditional Medicare beneficiary to care typically seen in a private Medicare Advantage (MA) plan despite the fact that the patient chose not to enroll in an MA plan.”
Further, the 54 members of Congress, both from the Senate and House of Representatives, contended that “DCEs pose a threat to patient care and outcomes due to the encroachment of profit-driven organizations on their care. In fact, a majority of the 53 current DCEs are investor owned and controlled. Owners of DCEs include private equity firms and large private health insurance companies. This model disrupts the sanctity of traditionally public Medicare benefits by giving control of beneficiary care to private interests. In fact, in the original request for proposals for potential DCE contractors, the previous administration mentioned that they specifically wanted ‘organizations currently operating exclusively in the MA program’ to take part in this model. Further, these models remove some of the protections for beneficiaries under traditional Medicare and according to CMS “include a reduced set of quality measures.”3 Seniors are one of the most vulnerable populations served in healthcare and they need more protections, not less.” The signatory members of Congress had concluded their letter by writing that, “In order to protect Medicare solvency and Medicare beneficiaries, we respectfully request a meeting with you to discuss how to stop the expansion of these Direct Contracting Models and oversee the sunsetting of these programs. This is a critical step to ensure Medicare continues to be a public benefit that offers the highest quality care to seniors. We stand ready to work with you to achieve a safe end to Direct Contracting programs in Medicare.”
That letter coming under Rep. Jayapal’s signature, was co-signed by several prominent members of Congress, including Rep. Rosa DeLauro (D.-Conn.), chair of the House Appropriations Committee and hair of the Labor, Health & Human Services, and Education Appropriations Subcommittee; and Rep. John Yarmuth (D.-Ky.), chairman of the House Budget Committee.
Among the signatories of Monday’s letter, signed by 222 organizations, were, along with APG and NAACOS, the AMGA (American Medical Group Association), the Association of American Medical Colleges (AAMC), Premier healthcare alliance, Atrium Health Wake Forest Baptist, Banner Health, Essentia Health, Mount Sinai Health System, MultiCare Health System, Ochsner Health, Providence Health and Services, Summit Health, Sutter Health, Trinity Health, and UnityPoint Accountable Care.
