A new value-based payment model for rural healthcare providers announced by CMS

Doctors

The Centers for Medicare and Medicaid Services has announced a new value-based payment model for rural healthcare providers.

CMS said, the Community Health Access and Rural Transformation (CHART) Model ties payment to value, lowers costs for patients and increases choice.

CHART will give support by way of new seed funding and payment structures, technical and learning support along with operational and regulatory flexibilities.

Those providers who are interested in the CHART Model are given two options for participation: The Accountable Care Organization Transformation Track and the Community Transformation Track.

The investment amount of up to $75 million in seed money is to be made by the Trump Administration to let upto 15 rural communities to participate in the Community Transformation Track. This investment would allow the implementation of care delivery reform, offer operational and regulatory flexibilities and provide predictable capitated payments.

These flexibilities give an opportunity to providers to pursue care transformation such as expanding telehealth to let the beneficiary’s place of residence to be an originating site. It also, waives off particular Medicare hospital conditions of participation to allow a rural outpatient department and emergency room to be paid as if they were considered as a hospital.

Patients and providers can avail to the benefits of telehealth through this program. This model lets participant hospitals to waive cost-sharing for particular Part B services and make available transportation support.

CMS will select upto 15 rural communities in September to participate in this track. Winners will be announced in early 2021 and the model is to begin in the 2021 summer.

An up-front investment is offered by the Accountable Care Organization Transformation Track.

CMS noted that it is built on the success of the ACO Investment Model (AIM), which managed to save $382 million over the span of three years.

Providers who participate in the ACO Transformation Track will enter into two-sided risk arrangements, which is a part of the Medicare Shared Savings Program. They may use all waivers available in the MSSP program.

CMS anticipates to release a request for applications in the spring of 2021 and the selection of up to 20 rural ACOs to participate in this track beginning in January 2022.

CMS notes that Americans living in rural areas face worse health outcomes and higher rates of preventable diseases than over 57 million Americans residing in urban areas.

Practical challenges like transportation, disproportionately impact rural Americans and their access to care. Rural healthcare providers face healthcare workforce shortages and operate on thin margins. Over 126 rural hospitals have closed down since 2010.

The percentage of hospitals who have negative operating margins is between 44% and 52%. Many rural hospitals find it tough to recruit and retain medical professionals.

Thus, rural providers have been slow in adopting national value-based payment models.

CMS Administrator Seema Verma said that the Trump Administration places an unprecedented priority to improve the health of one in five Americans living in rural areas.

The CHART Model is the next opportunity to make investments in order to transform the rural healthcare system, which will allow them to use every lever to support all Americans to get access to high-quality care where they live.