Q&A: Dr. Grace Terrell Predicts CMS Primary Care Initiatives’ Industry Impact


CMS is changing the primary care payment system. Physicians must prioritize patient-centered, value-based care to keep up.

Grace Terrell, MD

4 min read

Paying less for better health and better outcomes may soon be reality. The U.S. Department of Health and Human Services (HHS) and The Centers for Medicare & Medicaid Services (CMS) recently announced a new collection of voluntary payment models called the CMS Primary Cares Initiatives. These models, administered through the CMS Innovation Center and based on stakeholder advice, offer five payment options for primary care practices and providers to help improve care for patients with chronic conditions and severe illnesses and deliver better value for patients across the greater healthcare spectrum.

To learn more, we sat down with Grace E. Terrell, MD, MMM, Chief Executive Officer of Envision Genomics, Inc. Grace, a member of the Physician-Focused Payment Model Technical Advisory Committee, carefully examined and provided critical feedback on various stakeholders’ proposals – valuable analysis that the Primary Cares Initiatives are built on.

Q: Tell us about this new program and its potential impact on providers and patients.

Grace: Although the models’ details have not been released yet, the preliminary information about them is compelling regarding the breadth of medical practice types that may be impacted.

There are five models described under two separate paths: two that are Primary Care First (one including high needs populations) and three that are Direct Contracting (global, professional, and geographic). According to a presentation last Monday by senior HHS officials, the Primary Care First models are designed with independent primary care practices in mind.

In both the Primary Care First and Primary Care First – High Need Populations models, a monthly capitation fee is provided, along with a single-priced office visit fee, and performance-based adjustments based on reducing hospital utilization and the total cost of care. The TPCP's performance-based adjustment will provide an upside of up to 50 percent of revenue as well as a 10 percent downside, and will have a five-year test period scheduled to begin in January of 2020.

"Coupling physician-led design work with an openness to new partnerships, low-cost sites of service, telemedicine, improved access, investment in information integration, and community outreach should be in everybody’s tactical toolbox."

The other three models fall into three different Direct Contracting categories: Global, Professional, and Geographic. These models have more integrated systems of care in mind, including Accountable Care Organizations, multispecialty medical groups, integrated delivery systems, and Medicare Advantage Plans. Like primary care physicians, these models will also be designed to drive down cost and utilization. They are expected to launch in January of 2021. CMS is seeking input from stakeholders for the Geographical model, where CMS would offer entities an opportunity to assume the total cost of care for Medicare Fee-for-Service beneficiaries in a defined target region.

The goals of these payment models are ambitious: up to 25 percent of Medicare payment to primary care physician moving to these payment models within a few years.

Q: Where will the biggest long-term impact of this program be on the broader healthcare market?

Grace: I believe the concept of primary care, as we currently think about it, will evolve very rapidly after successful adoption of the new payment models. Primary care will move from a transactional low-intensity service model to one based on a coordination function organized around specified patient populations. Redesigned models of care will necessarily rely on integrated sources of data and will be home, community, and outpatient-centric rather than facility based. Healthcare organizations should be placing investment bets on home health, telemedicine, and integrated analytic platforms.

Q: What will keep these models from succeeding?

Grace: The Relative Value Units-based payment system has taken a big toll on the primary care workforce over the past thirty years. This workforce is under-resourced and has a much-constrained scope of practice compared to when I first practiced internal medicine 30 years ago. New mindsets, skills, and people are all necessary for a successful transition to the payment-system based upon a population health framework. Health information systems are poorly organized for a non-transactional based health system delivery system and will have to evolve rapidly. And, capital markets will need to organize sources of capital for primary care physicians taking on risk in ways they’re not yet familiar with.

Q: As the former founder and leader of Cornerstone Health Care – the first practice in North Carolina to achieve NCQA level 3 Physician Practice Connection recognition – what advice would you give organizations embarking on a value-based journey?

Grace: Well, Cornerstone Health Care reduced total cost of care and greatly improved the quality of the care we provided in a 13-month timeframe by focusing on redesigning care models based upon how our physicians thought patients could be better cared for. We focused on access across the board, internally transparent performance measures, and specific patient populations we thought would have the biggest impact, like patients with congestive heart failure, chronic obstructive pulmonary disease, cancer, the frail and elderly, the dually eligible Medicaid/Medicare, those with five or more chronic diseases, and integrated behavioral health. This redesign work energized physicians. We lowered the cost of care for these patients by between 13 and 20 percent. We were early to the market with value-based care and we made mistakes along the way. But our clinical results are undisputable.

CMS is now moving much of the primary care payment system to methods that can encourage value-based care. This provides physicians with an opportunity to help redesign more patient-centered models of care. This idea should be front and foremost in the strategy of every type of healthcare delivery system. Coupling physician-led design work with an openness to new partnerships, low-cost sites of service, telemedicine, improved access, investment in information integration, and community outreach should be in everybody’s tactical toolbox.

  • Grace Terrell, MD