After 10 Years, How Is the CMS Innovation Center Doing?

The Center for Medicare and Medicaid Innovation (CMMI), also known as the CMS Innovation Center, just celebrated its tenth birthday last year.  Tasked to address growing concerns about rising costs, quality of care, and inefficient spending, CMMI is a powerful tool for innovation in the US health care system.  After a decade, is CMMI delivering on its promise to innovate health care, or does the young agency still have much to accomplish?

All About CMMI

Created upon enactment of the Affordable Care Act (ACA) in 2010, CMMI is statutorily mandated to design, implement, and test new health care payment and delivery models for Medicare and Medicaid.  Managed by the Centers for Medicare and Medicaid Services (CMS), CMMI has launched over 40 new payment models since its inception, including accountable care organizations, medical homes models, and bundled payment models.  CMMI separately awards grants to state agencies, researchers, and other organizations for projects to design and implement new payment models with the same goals of improving care and lowering costs, and some of CMMI’s work includes multi-payer alignment models that impact patients with commercial insurance. 

2020 Report to Congress

Released on August 4, the 2020 Report to Congress provides an in-depth look at the performance of CMMI models and serves as a key indicator of how the center is doing in its effort to address rising costs and boost quality.  While the report focuses on CMMI’s activities from October 1, 2018, to September 30, 2020, it also highlights some actions taken from September 30 to December 31, 2020. 

In the 2020 Report, CMS estimated that over 27.8 million Medicare and Medicaid beneficiaries plus enrollees in commercial insurance plans have received care from over 500,000 health care providers or plans participating in alternative payment models under CMMI.  The 2020 Report analyzed a total of 38 active models within CMMI, including 11 new models announced since the 2018 Report and 27 active models that were launched prior to October 2018.

Summary of Findings

Unfortunately, only a handful of CMMI models met either goal of reducing costs or improving quality.   Furthermore, only the five following models delivered “statistically significant savings” to the Medicare Trust Fund according to the report:

Additionally, a few models led to improvements in quality but did not yield any noteworthy savings, including the Comprehensive End-Stage Renal Disease (ESRD) Care (CEC) Model and the Comprehensive Care for Joint Replacement (CJR) Model.

Saving money and raising quality aren’t the only metrics for a model’s success.  For CMS to consider permanently expanding a model for the federal health care entitlement programs, models must meet several additional criteria, including assurance from the CMS Office of the Actuary that a model’s expansion would not deny or limit coverage or provision of benefits under Medicare, Medicaid, and CHIP.   According to the report, only three models met the criteria:

How Can CMMI Improve?

While the 2020 Report to Congress does not explicitly offer recommendations on how to improve model performance, it does identify four issues that contributed to lower-than-expected model performance:

  • Selection bias created by voluntary models.
  • Benchmark inaccuracy.
  • Quality measure misalignment.
  • The need for greater data transparency.

These four issues identified in the report suggest a few ways CMMI models could produce better quality and provide for lower costs, mainly through mandatory model participation and more data transparency.  The idea of making more payment models mandatory is not a new idea.  In a July 2021 interview with Health Affairs, CMMI Director Liz Fowler explained that a shift towards mandatory models, which had already begun during the previous administration, will continue under the Biden administration and are likely to play a greater role in CMMI’s future.

The fact that CMMI models are underperforming is not lost on CMS leadership.  In a recent Health Affairs blog post, a few top agency officials including CMS Administrator Chiquita Brooks-LaSure and Fowler acknowledged only a handful of models have incurred savings and met the requirements to be expanded.  In addition to recounting a few recommendations from outside experts, such as MedPAC’s endorsement for streamlining and harmonizing models, Brooks-LaSure and Fowler offered several takeaways to inform how model performance could be improved.

  • CMMI needs to reevaluate how it designs financial incentives in order to boost meaningful provider participation.
  • Challenges in setting financial benchmarks have undermined models’ effectiveness, underscoring a need to ensure models are not resulting in overpayment and explore ways to improve or replace the current risk adjustment methodology. 
  • Since providers find it hard to accept downside risk if they lack the tools to change care delivery, CMMI should help ensure providers have options for managing risk, such as support in transforming care, waivers, and data. 

Despite dozens of underperforming models, CMS recognizes that the Innovation Center has room for improvement, and the agency’s leaders are keen on delivering a strategy that works.  Hopefully, through streamlining current models, implementing more mandatory models, boosting participation in voluntary models, improving financial incentives, and ensuring model participants have the tools they need to succeed, CMMI models could hopefully be in a better position to  both reduce costs and improve quality in time for the center’s 20th anniversary.

What Happened, What You Missed: July 12-16

CMS Proposes to Extend Some Telehealth Services through 2023

In its physician fee schedule for 2022, the Center for Medicare and Medicaid Services (CMS) proposed extending coverage for some Medicare telehealth services through the end of 2023.  Under the rule, CMS is proposing to remove certain statutory restrictions to allow patients in any geographic location and in their homes access to telehealth services for diagnosis, evaluation, and treatment of mental health disorders and allow for coverage of audio-only telehealth services to apply to counseling and therapy for opioid treatment.  The release of the proposed rule comes just one day after a group of bipartisan House Energy and Commerce Committee members sent a letter to Health and Human Services (HHS) Secretary Xavier Becerra urging the Department to make Medicare coverage for some telehealth services added under the public health emergency permanent.  Comments on the proposed rule are due on September 13. 

Senate Democrats Reach Agreement on $3.5 Trillion Infrastructure Package

On July 13, Senate Majority Leader Chuck Schumer (D-NY) announced an agreement on a $3.5 trillion “human infrastructure” package after a meeting with Democrats on the Senate Budget Committee.  Major proposals include subsidized child care, national paid family leave, free community college, a host of climate change initiatives, and expanding Medicare coverage for vision, dental, and hearing services.  Democrats are hoping to pass the legislation through budget reconciliation, which would allow the bill to advance in the evenly split Senate with a simple majority.  However, it remains to be seen if the White House and Democratic leadership can count on all Senate Democrats to support the package, including moderate Democrats like Sen. Joe Manchin (D-VW), who is concerned about how the legislation will be paid for.

Drug Overdose Deaths Hit New Record in 2020

According to data from the Centers for Disease Control and Prevention, drug overdose deaths increased nearly 30% from 2019 to hit a record high of over 93,000 in 2020.  A contributing factor is the widespread use of fentanyl, which can halt breathing even if a small amount is ingested. Additionally, the pandemic played a significant role in the increase of deaths, strained health care resources, and made addiction treatment more difficult to obtain.   

CMS Studying How Much Medicare Should Pay for New Alzheimer’s Drug

On July 12, CMS launched a National Coverage Determination analysis to determine whether and under what circumstances Medicare should cover Biogen’s recently approved Alzheimer’s drug Aduhelm. Aduhelm has attracted controversy for its high price tag of $56,000 and inconsistent efficacy in clinical trials. Furthermore, on July 15, a group assembled by the Institute for Clinical and Economic Review unanimously agreed that Aduhelm does not work better than existing Alzheimer’s treatments. However, CMS will propose a decision within six months and then allow stakeholders to comment within a 30-day period with CMS making a final decision three months later. Until then, Medicare Administrative contractors will be left to make coverage determinations for the Alzheimer’s drug. 

ICMYI: Library of Congress Reopens to the Public

On July 15, the Library of Congress reopened to the public, marking a major step in reopening the US Capitol complex.  Visitors are required to get tickets online for a timed entry on Thursday, Friday, or Saturday, and face masks are required for all visitors regardless of vaccination status.  The library’s Thomas Jefferson building is considered an architectural gem and was modeled after the Pantheon in Rome.  However, it’s unclear when the Capitol itself will reopen to the public. 

CMS Puts Geo Model on Hold

On March 1, the Center for Medicare and Medicaid Services (CMS) announced its Geographic Direct Contracting Model is “currently under review” until further notice.   While CMS has yet to provide a reason for the pause, criticism from industry stakeholders and the new Center for Medicare and Medicaid Innovation (CMM) Director may explain the pause.

Announced in December 2020, the Geographic Direct Contracting Model, or the “Geo Model,” envisions using direct contracting entities (DCEs) to build integrated relationships with health care providers and coordinate care for Medicare beneficiaries in designated geographic regions.  The model, which had been under development for two years, builds on lessons learned from the Next Generation ACO model, Medicare Advantage, and other initiatives.

However, the Geo Model is the only CMMI model that has been paused by the new Administration so far.   In the absence of an official justification from CMS, one of the reasons why the model may have been put on hold was criticism from health care stakeholders.  In a December 2020 letter to then-CMMI Director Brad Smith, the National Association of ACOs warned the model could generate confusion among beneficiaries over who is compelled to participate.  Additionally, the Center for Medicare Advocacy urged the then-Biden Transition Team in a December 2020 letter to halt the Geo Model due to uncertainty over how the model would work with other forms of insurance such as Medigap.

The move to suspend the Geo Model is not entirely without precedent.  The Biden Administration paused or withdrew numerous actions by the previous Administration since assuming power, which is typical for new presidential administrations.  For instance, CMS has withdrawn proposed rules on oversight for accrediting organizations, revisions to dialysis coverage requirements, and changes to Medicare Part A enrollment requirements since January 20. 

It should be noted that not all stakeholders oppose the Geo Model.  In a March 4 letter, America’s Physician Groups urged CMMI to restart the model as soon as possible due to “extensive financial investments” participating providers have already made in preparation for the model’s launch, as well as a genuine belief that the model represents a meaningful shift away from the fee-for-service model.

In addition to external criticism, pressure to put the Geo Model on hold may have come from within CMMI itself.  Recently, the Biden Administration tapped Liz Fowler to serve as CMMI Director.  Prior to her new leadership role at CMS, Fowler served as Executive Vice President for Programs at the Commonwealth Fund, where she co-authored a December 2020 blog post about the Geo Model.  While the blog post largely served as an explainer for the model, it raised several questions, including how CMS would be able to produce savings CMS had projected and whether CMS is adequately tracking beneficiaries’ use of services under the model.

Thus, pressures from both inside and outside CMS have likely led to the Administration’s decision to suspend the model for the time being.  That said, while not knowing yet where CMMI may take the geographic-based care and payment model, it certainly seems possible that the Administration could choose to pause other CMMI models in the future.