From the Desk of the CEO

Primary Care First is a set of payment model options that aims to financially incentivize value and quality of care for Medicare beneficiaries seen in the primary care setting, especially those with complex medical conditions.¹ The principles of this model are similar to those of current Comprehensive Primary Care Plus (CPC+) models, especially in terms of prioritizing the primary care provider–patient relationship, financially rewarding improvement in health outcomes, and reducing administrative burden.

According to the American College of Physicians,“ capitation is a fixed amount of money per patient per unit of time paid in advance to the physician [or health care provider] for the delivery of health care services.”¹ The amount of money actually paid depends on the range of services provided, how many patients are involved, and the duration of time in which the services are provided.¹ The capitation rate is often set at PMPM (per member, per month) or PMPY (per member, per year). The rates used in capitation are determined using the local costs and average utilization of services; as a result, rates can differ from one part of the country to the other. Before a capitation agreement is made, a list of specific services that must be provided to patients is included in the contract.

Bundled payment is an alternative reimbursement model that is designed to help move from the traditional fee-for-service (FFS) payment to value-based care. With bundled payments, all providers and/or health care facilities associated with a patient undergoing a specific episode of care, or “clinical episode,” are paid a single fixed amount or “target price.” All providers and health care facilities share in the financial risks and outcomes associated with the episode of care.

Accountable Care Organizations (ACOs) are groups of health care providers and hospitals who partner together to provide high-quality, coordinated care and decrease overall costs for a defined population, with the goal of sharing these cost savings.¹ The first Medicare ACOs were approved as part of the Affordable Care Act in 2009.

According to the Agency for Healthcare Research and Quality (AHRQ), a PCMH is a model of the organization of primary care that delivers the core functions of primary health care.¹ They are also often called medical homes, primary care medical homes, medical neighborhoods, advanced primary care practices, and patient-centered health care homes. In adopting the PCMH model, primary care practices transform their practice to integrate the following functions.