CMS announces model for value-based care

Dec. 4, 2020

The Centers for Medicare & Medicaid Services (CMS) announced a new voluntary payment model that involves a geographic-based approach to value-based care, according to a fact sheet from the agency.

The Geographic Direct Contracting Model, or Geo, will test whether a geographic-based approach to value-based care can improve quality of care and reduce costs for Medicare beneficiaries across an entire geographic region.

CMS said the model will enable Direct Contracting Entities (DCEs) to build integrated relationships with healthcare providers and community organizations in a region to better coordinate care and address the clinical and social needs of Medicare beneficiaries.

DCEs – may include sophisticated Accountable Care Organizations (ACOs), health systems, healthcare provider groups, and health plan – will take responsibility for the total cost of care for Medicare Fee for Service (FFS) beneficiaries in a specific region.

CMS said the model builds on lessons the CMS Innovation Center has learned from prior Medicare initiatives involving accountable care organizations (ACOs), including the Medicare Shared Savings Program and the Next Generation ACO Model, as well as approaches from Medicare Advantage, Medicaid Managed Care, and risk-sharing arrangements at commercial health plans. The model requires participants to take full risk with 100 percent shared savings and shared losses for Medicare Parts A and B services for aligned Medicare FFS beneficiaries in a defined target region.

CMS said the model will be tested over a six-year period in four to 10 regions and will include two three-year performance periods, the first of which starts on January 1, 2022, and the second of which starts on January 1, 2025.

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