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Chronic Care Management Services Improve Health Outcomes and Reduce Costs for America’s Seniors

The Centers for Medicare and Medicaid Services (CMS) estimates that 68% of Medicare fee-for-service beneficiaries have multiple (two or more) chronic conditions accounting for most of Medicare fee-for-service spending (94%). It’s no surprise that beneficiaries with even more clinical complexity, those who have six or more chronic conditions, account for only 17% of Medicare fee-for-service beneficiaries, but more than half (53%) of Medicare spending. Given these high costs and considering the significant limitations in activities of daily living that many beneficiaries face, it is clear that our nation’s elderly require substantial care coordination and management to optimize health outcomes, reduce preventable health care costs, and improve quality of life.

Value-based health care transformation promises to shift health care away from volume-based reimbursement by introducing alternative payment models. The hope is that payment reforms will allow health care professionals the time and ability to provide optimal care coordination and management services for patients. While these models have been growing in numbers, it will take time before they will be able to usurp fee-for-service reimbursement. In some areas of the country, particularly in rural or frontier areas, it is unclear whether alternative payments models will be viable, at least in the near-term. Given this context, policymakers at CMS decided to create a “bridge” payment for health care professionals to better care for fee-for-service beneficiaries with multiple chronic conditions outside of an office visit. It’s called Chronic Care Management (CCM).

Acknowledging that case management services are critical to the success of caring for patients with complex needs, CMS developed chronic care management codes as part of the physician fee schedule for patients with two or more chronic conditions whose conditions are expected to last at least 12 months. Like many Medicare covered outpatient services, clinical staff may provide CCM services under the direction of a billing practitioner. As with other part B services, patients have a 20 percent copay. Services include the development of a comprehensive care plan and enhanced coordination and communications between a patient’s primary physician and the specialists who are treating them.

An initial evaluation of CCM services by Mathematica Policy Research in 2017 found that beneficiaries reported general satisfaction with these services and providers perceived several positive outcomes for beneficiaries including improved patient satisfaction and adherence to recommended therapies. In addition, the evaluation found that the average rate of growth in estimated Medicare per-beneficiary-per-month (PBPM) expenditures for CCM beneficiaries relative to a comparison group decreased by $28 in the 12-month follow-up period and $74 in the 18-month follow-up period. It was thought that this was due to decreases in facility expenditures of inpatient hospital services, skilled nursing facility services, and outpatient services.

Unfortunately, the evaluation also showed that only 684,000 beneficiaries received CCM services in the first two years, less than 5% of Medicare patients eligible for these services. There are several reasons for the underutilization of this benefit, including the lack of personnel to develop a care plan, extensive documentation requirements, the need for beneficiary written consent to perform CCM services, collection of the part B copayment for a benefit not performed during an office visit, and inadequate payment rates. In 2019, CMS addressed many of these issues as part of the 2019 physician payment rule. Commenters to the rule suggested that CMS eliminate the copay, since patients don’t fully see or appreciate the value of the benefit, but CMS noted that the elimination of the copayment would require congressional action.

As part of BPC’s July 2019 report, Next Steps in Chronic Care, we recommended building on the Bipartisan Budget Act’s chronic care provisions to improve the availability of services in Medicare fee-for-service for individuals with chronic conditions who receive services through alternative payment models. These models include accountable care organizations and the comprehensive primary care model. Recognizing the potential for limited access to these models in some areas, the report recommended expanding services for those receiving care management services under Medicare’s CCM benefit. Among those recommendations, BPC proposed eliminating the beneficiary copay for CCM services, since the benefits covers provider-to-provider communications outside an office visit, and unseen by beneficiaries.

Removing patient cost-sharing for a service that improves patient satisfaction and potentially reduces Medicare expenditures is consistent with the principles of value-based insurance design (VBID). VBID argues that financial barriers should be removed for services of high value to patients. It is a concept that has already been introduced in Medicare Advantage through new models as well as for preventive services in Medicare. It is time to extend this concept to chronic care management services.

That is why we applaud Representatives Suzan DelBene (D-WA), Jeff Duncan (R-SC), and Peter Welch (D-VT) for introducing the Chronic Care Management Improvement Act, H.R. 3436. This bipartisan legislation would eliminate Medicare beneficiary cost sharing for chronic care management, improving the coordination of care for Medicare beneficiaries with multiple chronic conditions. It’s simple step that would improve health outcomes and reduce costs for America’s seniors.

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