This week's healthcare 3 things to know in 5 minutes

#1 - Primary Care Flex Model

https://www.managedhealthcareexecutive.com/view/for-rural-acos-new-primary-care-model-from-cms-offers-much-needed-financial-help

The Change Healthcare hack in February served as a stark reminder of the financial vulnerabilities faced by healthcare organizations, emphasizing the need for resilient payment models. To address these challenges, the Centers for Medicare & Medicaid Services (CMS) introduced the ACO Primary Care (PC) Flex Model, set to launch on January 1, 2025, aimed at supporting low-revenue accountable care organizations (ACOs) with advanced payments and ongoing financial assistance. SIGN-UPS are happening now!

Key Points:

• Financial Support for ACOs: The ACO PC Flex Model offers $250,000 in upfront payments and monthly stipends to help low-revenue ACOs manage setup and administrative costs, ensuring a stable revenue stream.
• Promotion of Value-Based Care: By replacing Medicare fee-for-service (FFS) reimbursements with prospective payments, the model encourages efficient, patient-centered care and health equity, especially in underserved rural areas.
• Encouraging Care Coordination: The model aims to improve coordination between primary and specialty care, including behavioral health services, to enhance outcomes for patients with chronic and mental health conditions.

#2 - Site Neutral Payments Front and Center

https://www.healthcaredive.com/news/house-budget-committee-healthcare-consolidation-site-neutral/717025/

The House Budget Committee convened to address the impact of healthcare consolidation on costs, quality, and access. A major point of discussion was standardizing Medicare payments between hospital-owned outpatient sites and independent physician offices, known as site-neutral payments. Lawmakers and witnesses expressed strong bipartisan support for these policies to reduce the incentives for hospital acquisitions of physician practices and curb rising medical costs. Additional reforms suggested included reducing administrative burdens on physicians and stabilizing Medicare payments by tying them to inflation.

Top 3 Key Takeaways:

1. Support for Site-Neutral Payments: There is broad bipartisan support for standardizing Medicare payments across different healthcare sites to eliminate incentives for hospital acquisitions of physician offices. This policy aims to curb rising healthcare costs and reduce the financial burden on patients.
2. Impact of Consolidation on Costs and Access: Healthcare consolidation, particularly when hospitals acquire physician practices, significantly increases costs without improving care quality. This trend threatens the existence of independent physicians and drives up medical expenses for patients.
3. Additional Reform Proposals: Witnesses suggested several reforms to discourage consolidation, including reducing administrative burdens on physicians, stabilizing Medicare payments by linking them to inflation, and possibly revising the 340B drug discount program. Increased transparency in PBM (pharmacy benefit manager) operations was also recommended to help lower drug prices.

#3 - Earnings Calls - Pro Tip

I like to listen in (or at least look at cliff notes of) earnings calls. You frankly learn a lot. A few interesting ones to catch up on include HCA and Community Health Systems (CHS). Both organizations are reporting strong Q1 2024 results.

HCA - https://investor.hcahealthcare.com/news/news-details/2024/HCA-Healthcare-Reports-First-Quarter-2024-Results/default.aspx

Community Health Systems - https://finance.yahoo.com/news/community-health-systems-inc-nyse-125711226.html

Have a great short week!

Best,

Brian Norris MBA, RN, FHIMSS