Healio Special Report: Health Care and Politics
Healio Special Report: Health Care and Politics
May 15, 2019
6 min read

Trump administration’s proposed ‘historic’ changes to primary care needed, but uptake might be limited

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Alan Dow 
Alan Dow
Carolyn Engelhard 
Carolyn Long Engelhard

Experts and medical societies recently indicated that the new voluntary CMS Primary Cares initiative announced by HHS Secretary Alex Azar is a step in the right direction.

But along with the positive feedback came concern that breaking from the old fee-for-service model would be difficult for many primary care physicians, thus yielding only limited success.

“There is a clear need to change things, but the learning curve and risk involved with CMS Primary Cares may hinder widespread acceptance of the strategy,” Alan Dow, MD, MSHA, assistant vice president of health sciences for interprofessional education and collaborative care, Virginia Commonwealth University and Healio Primary Care Today board member said in an interview.

Details of CMS Primary Cares

At a press conference last month, Azar said the first model, known as Primary Care First, contains a similarly-named offshoot and another offshoot called High Needs Populations. Both will reward smaller primary care practices with bonuses when their patients stay out of the hospital, but will have to pay a specific share of their practices’ revenue when a patient ends up sicker than expected.

The American Academy of Family Physicians website has also indicated that Primary Care First contains a risk-adjusted, population-based payment, a flat visit fee for each face-to-face visit with a PCP, an upside performance-based payment capped at 50% of revenue and the downside risk maxed at 10% of revenue.

AAFP’s website also indicated that Primary Care First practices can opt into the Seriously Ill Population — patients needing palliative care or hospice practices, having many comorbid conditions, utilization patterns and “the presence of proxies for frailty.”

The second model, Direct Contracting, comes with three choices and is intended for larger practices and is like Primary Care First but also penalizes the entire system when patients do not stay healthy, according to Azar.

AAFP discussed the three offshoots within Direct Contracting on its website:

  • The Professional prong incorporates 50% savings and losses as well as Primary Care Capitation (defined as risk-adjusted monthly payment for enhanced primary care services).
  • The Global prong incorporates 100% savings/losses and Primary Care Capitation or Total Care Capitation (defined as risk-adjusted monthly payments for all services provided by participants and preferred providers with whom they have agreements).
  • The Geographic prong starts off like Global, but also contains responsibility for total cost of care for all Medicare fee-for service beneficiaries in a specific geographic region.

“These models deliver on the vision we’ve laid out for value-based care, four Ps: patients in control as consumers, providers acting as accountable guides through the health care system, payments based on outcomes, and preventing disease before it occurs or progresses,” Azar said at the press conference.

Doctor meeting with couple 
The CMS Primary Cares Initiative "delivers on the vision [the Trump administration] has laid out for value-based care, four Ps: patients in control as consumers, providers acting as accountable guides through the health care system, payments based on outcomes, and preventing disease before it occurs or progresses," an administration official said at a press conference.


He added that CMS Primary Cares seeks to lower Medicare and Medicaid costs, provide better alignment for more than 25% of all Medicare fee-for-service beneficiaries, offer new participation and payment options and opportunities for PCPs and health care providers, and create new coordinated care opportunities for a large portion of the dually eligible Medicare and Medicaid beneficiaries.

Societies, experts offer pros, cons

AMA, AAFP and ACP all voiced various levels of support for CMS Primary Cares within hours of Azar’s announcement, noting how the initiative reflects concerns that they had previously brought to CMS and HHS’ attention.

AMA observed how Azar’s initiative provides multiple payment models, AAFP noted how it allows for high-quality, cost-effective care that move away from the fee-for-service model, and ACP pointed out how the initiative underscores the critical role primary care plays in value-based care delivery. ACP also said that the new models aim to reduce administrative burdens and allow more time with patients, which the AMA, AAFP and ACP have long fought for.

Experts consulted for this story acknowledged that while the fee-for-service model is unsustainable, it is also very familiar to many physicians who may find it easier to stick to the status quo. Thus, these experts expressed cautious optimism about Azar’s initiative.

“CMS Primary Cares appears to be the primary-care centric version of the Accountable Care Organizations that former President Barack Obama’s administration championed at the community level,” Dow said in the interview.

Dow also said he liked that the models allow participation by PCPs, clinical nurse specialists, nurse practitioners and physician assistants within family medicine, internal medicine, general medicine, geriatric medicine, and hospice and palliative medicine who meet certain criteria.

“This allows a level of creativity and empowerment that many PCPs have not seen before,” he told Healio Primary Care Today.

“CMS Primary Cares is logical and needed. As we move forward in population-based care may help balance the explosion of health care costs projected over the next 20 years,” he added.


Carolyn Long Engelhard, MPA, an associate professor and health policy analyst at the University of Virginia School of Medicine, explained other areas where she thought Azar’s initiative would have a positive impact on health care.

“CMS Primary Cares shifts the financial incentives in Medicare reimbursement from service utilization to rewarding primary care physicians for care coordination and disease management, which is a positive. The hope is that by managing the overall care continuum for seniors — particularly those with complex, chronic conditions — in Medicare or Medicare and Medicaid, there will be less need for expensive hospital care as patients' conditions are better managed in the ambulatory setting,” she said in an interview.

“Azar’s initiative also allows for risk adjustment payments for the care of seriously ill patients, which may mitigate the temptation for providers to select ‘healthier’ patients in order to maximize the reimbursement, which is another positive,” Engelhard continued.

“In addition, by shifting to a capitated model, the incentives totally change for physicians and health systems. Capitation treats traditionally nonreimbursable services like cognitive services/evaluation and management just like traditional reimbursable ones like ordering a test or performing a procedure. A finite prepayment model incentivizes providers to keep patients' medical status stable and avoid hospitalizations. About 75% of all health care spending in the U.S. goes toward chronic conditions and so rewarding physicians for managing chronic conditions well should provide better care and cost savings,” she added.

However, Engelhard also noted that CMS Primary Cares needs a lot of support to come to fruition, and she was not sure that support exists for the strategy as proposed, would do so.

“For Azar’s plan to work, 26 geographic regions participating in the model and from state Medicaid agencies who participate in paying for the care of dually eligible seniors have to buy-in. Keep in mind that the 11 to 12 million patients who are dually eligible for Medicare and Medicaid are the most expensive Medicare patients because they are frailer and more complex and often live in skilled nursing facilities. Managing the two revenue streams for this dually eligible population has been challenging for states in the past,” she said.

“CMS will have to provide flexibility to participants with regard to the administrative and reporting burdens in order to get providers to participate,” Engelhard continued.

Dow said change to primary care systems and payment methods is necessary, but most PCPs will be reluctant to change their way of doing those tasks.

Doctor And Another Doctor Talking 
A Healio Primary Care Today board member said while change to primary care systems and payment methods is necessary, most PCPs will be reluctant to change their way of doing those tasks.


“My biggest criticism of this plan is that we don’t have a lot of details, and hence, I am not sure our workforce is prepared and ready to move into a model of taking on risk without more education,” he said.

“We have trained PCPs in this fee-for-service model, and so a real tipping point will be when they change their perspective on how they treat primary care in a population-based way where it is not about seeing another patient and generating another charge, but about how we better care for the population,” Dow added.

Azar acknowledged that implementation will take time.

“We won’t fix this overnight,” he said at the press conference. “Much more work still lies ahead, but we know where we’re going. [But] I believe we’ll look back at what we’re announcing today as a historic turning point in American health care.”

Primary Care First is slated to start in January 2020, while the Direct Contracting is expected to begin in January 2021, according to an HHS press release. – by Janel Miller

For more information:

More information on the Primary Care First payment model is available at:




ACPonline.org. “Internists encouraged by CMS Announcement of new payment and delivery models to support primary care.” https://www.acponline.org/acp-newsroom/internists-encouraged-by-cms-announcement-of-new-payment-and-delivery-models-to-support-primary-care. Accessed May 13, 2019.

AAFP.org. “CMS heeds AAFP advice on new payment models." https://www.aafp.org/news/blogs/inthetrenches/entry/20190430itt-primarycares.html. Accessed May 13, 2019.

AMA-Assn.org. “Physician proposals inspire new HHS pay models for primary care.” https://www.ama-assn.org/practice-management/payment-delivery-models/physician-proposals-inspire-new-hhs-pay-models-primary. Accessed May 13, 2019.

Disclosures: Neither Dow nor Engelhard report any relevant financial disclosures.