In response to proposals for new payment models, HHS declines to advance any for future testing

On June 13, 2018, the Department of Health and Human Services (HHS) released responses by Department of Health and Human Services Secretary Alex Azar to the comments and recommendations of the Physician-Focused Payment Model Technical Advisory Committee (PTAC) on a dozen proposals for physician-focused payment models (PFPMs) reviewed by the committee, and sent to HHS between October 2017 and May 2018. HHS did not accept any of the proposals for broader implementation.

PTAC was created under the Medicare Access and CHIP Reauthorization Act (MACRA) as a platform for health care stakeholders to propose new PFPMs for consideration as pilots or demonstration projects by the Centers for Medicare and Medicaid Services (CMS).

While HHS accepted none of the recommended proposals for even limited-scale testing, the Secretary’s responses provide some insight into areas of particular interest to the department for future payment models. In a letter accompanying the responses, Secretary Azar highlighted three key considerations for stakeholders to take into account as they develop proposals for submission to PTAC:

  1. HHS seeks models that demonstrate potential for significant impact on the Medicare population in ways where the agency can conduct a robust evaluation.
  2. Use of proprietary tools or tools that are not already developed in a proposed APM is an obstacle to HHS’ testing of the model.
  3. Providing care in accord with current standards of practice or accelerating adoption of emerging standards of care do not require an APM.

A review of the Secretary’s responses to the individual proposals also found concerns about patient attribution and risk adjustment; broad scalability across providers and payers; availability of appropriate quality measures; misalignment of incentives; and the prospect for proposed new payment methodologies to yield savings for the Medicare program.

In addition, the Secretary’s responses expressed an interest in models proposed by the Coalition to Transform Advanced Care (C-TAC) and the American Academy of Hospice and Palliative Medicine (AAHPM) that outlined potential variations in Medicare payment policy to facilitate more comprehensive delivery of palliative care to Medicare beneficiaries with serious illnesses. The Secretary’s responses indicate that HHS will take into account the “input and insights” of C-TAC and AAHPM as HHS “contemplates further model design in this area.”

The next PTAC meeting is scheduled for September 6-7, 2018, in Washington, D.C.


Anne Phelps
Principal | Deloitte Risk and Financial Advisory
US Health Care Regulatory Leader
Deloitte & Touche LLP
Latest conversations from Anne Phelps on Twitter

Daniel Esquibel
Senior Manager | Deloitte Risk and Financial Advisory
Deloitte & Touche LLP

Ethan Joselow
Manager | Deloitte Risk and Financial Advisory
Deloitte & Touche LLP

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