In the News

What’s the news: The AMA is pressing Congress to make key legislative changes that will help facilitate greater physician participation in alternative payment models (APMs), which are intended to accelerate the delivery of high-quality care and generate savings for the Medicare program.

Now a bipartisan group of legislators has introduced H.R. 5013, the Value in Health Care Act. The AMA applauded the bill’s introduction by Reps. Darin LaHood, R-Ill., Suzan DelBene, D-Wash., Brad Wenstrup, R-Ohio, Earl Blumenauer, D-Ore., Larry Bucshon, MD, R-Ind., and Kim Schrier, MD, D-Wash.

“The movement toward value-based care—designing payment models to support quality and coordination of patient care rather than the number of services delivered—is gaining momentum,” said AMA President  Jesse M. Ehrenfeld, MD, MPH.

“We must build on that progress with more investment in these models and ensure that physicians in all specialties can be active participants” in APMs, he added.

“This crucial bipartisan bill will continue the 5% APM incentive payments for two years and freeze the 50% revenue threshold that physicians in value-based care models must meet to qualify for these bonuses over the same time frame,” said Dr. Ehrenfeld, a senior associate dean, tenured professor of anesthesiology and director of the Advancing a Healthier Wisconsin Endowment at the Medical College of Wisconsin.

The bill would give the Health and Human Services (HHS) secretary the authority to further increase the revenue threshold, but at a pace of no more than 5% in any single year.

“These proposed policies would grant HHS the needed flexibility to adjust the financial risk at a pace that enables more physicians to participate in APMs, while building on the tremendous movement toward value-based care,” said the AMA’s president.

Why it’s important: APMs are a key approach to achieving value-based care by providing incentive payments to deliver high-quality and cost-efficient care for a clinical condition, a care episode, or a patient population. To date, however, there are far fewer opportunities for physicians to participate in Medicare APMs than Congress envisioned under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA).

Historically, Congress provided 5% APM bonuses, which are paid two years after the conclusion of a specific performance year, for qualifying providers who earn a certain proportion of their revenue or see certain proportion of their patients from these value-based care models.

The Consolidated Appropriations Act, 2023, however, only provided a 3.5% incentive payment for 12 additional months. Absent congressional intervention, the 3.5% incentive payment expires Jan. 1, 2024, and the APM revenue threshold jumps from 50% to a substantially more challenging 75%.

Other key provisions within the Value in Health Care Act include: 

• Authorizing the Centers for Medicare & Medicaid Services (CMS) to establish lower APM participation thresholds for episode models and other types of APMs that, by definition, involve a lower percentage of a practice’s patient population.
• Eliminating revenue-based distinctions within Medicare’s Accountable Care Organization (ACO) Program, which affects certain rural and safety net providers’ share in the savings they earn and often forces them to accept greater levels of financial risk at a more rapid pace.
• Establishing enhanced transparency to ensure that CMS sets appropriate spending benchmarks that don’t penalize ACOs for their own success.
• Creating a voluntary, full-risk model option for Medicare ACOs.
• Providing additional technical support, including infrastructure investments, from HHS for ACOs, small practices, physicians, or other providers that serve rural or medically underserved populations. 
• Requiring the Government Accountability Office to produce a study evaluating potential parity between APMs and Medicare Advantage payment policies, flexibilities and financial benchmarks.