An Update on the Medicare Medical Home Demonstration

The Disease Management Care Blog listened in on today’s ‘CMS Employer Forum,’ conference call, where James Coan, a Project Officer, gave listeners an update on the status of the Medicare Medical Home Demonstration. As DMCB readers may recall, the next step is the selection of the 8 States where the demo will be carried out.

According to Mr. Coan, that selection has been made. All that's needed is the green light from the President’s Office of Management and Budget (OMB). ‘Assuming’ it’s given a ‘go,’ physician-based practices in the 8 States will be notified that the application process is open. Following approval of that first application, practices will then need to apply (with all the necessary documentation) to the NCQA for Medical Home status. Six to nine months (or even a year) later, sites will be notified of their ‘Tier One’ or ‘Tier Two’ status and be given the go-ahead to enroll beneficiaries using a ‘beneficiary agreement’ form. The payment from CMS to Medical Home clinics will be ‘like capitation.’

There was more information from the Q&A:

There is no update on the timeline and in particular, there is no idea when the 8 states are going to be announced. Mr. Coan cautioned this was a lengthy clearance process, involving many moving parts, many stops, many questions, many recommendations and many negotiations.

CMS will reserve the right to conduct periodic audits of medical homes using samples of claims, but it is really counting on the application process to keep fraud to a minimum.

There are no plans at this time to switch from a two tier to a one tier system.

There are no plans for any vendors.

The main purpose of the Medical Home demo is to determine if this approach to care is cost neutral, with particular attention to hospitalization rates, ER claims, medication complications and 'testing' redundancy using the Medicare claims data sets. Practices may (or may not) be asked to submit quality data.

The DMCB’s impressions?

If all CMS wants to do is reduce claims expense, all it needs to do is junk this medical home stuff and open the playbook of the 1990s style HMOs. Saving money is easy, especially if a payment system resembling capitation is used. Saving money and a) maintaining or b) improving quality and satisfaction is what’s difficult. Not having an explicit plan in place (with or without the statutory authority) to assess the quality of care is remarkable.

Given the degree of OMB processing, the DCMB still wonders if the unveiling of the 8 states may be delayed thanks to the Administration’s conundrum of reconciling overall healthcare reform with the Medical Home statute.

While CMS prides itself on being a leader in innovation and promoting transparency, even the perception of delays (thanks to the OMB) and opaqueness (is one tier a possibility or isn’t it?) in the demo has implications for the ‘optics’ of health reform in general. The primary care community will point to the non-physician, over-lawyered technocrats and start quoting Reagan's 'there you go again.'