Four Seasons Consulting

Alternative Payment Model For Serious Illness Care

Posted on Feb 2, 2019 3:10:23 PM

Alternative Payment Model for Serious Illness Care


The transition from a fee for service to a value-based payment healthcare system, will require new tools to help navigate the growing needs of patients with serious illnesses. The current healthcare system is inefficient, with significant fragmentation of care and poor transitions across care settings. In addition, quality outcomes are poor, significant disparities exist, and a high number of people remain uninsured.

The CMS Innovations Center (CMMI), which was created by the Affordable Care Act, was developed to help design, test, and implement new payment models. Innovative models are being developed across the country to help deliver better care that is person and family centric and focused on delivering value (quality/cost) rather than volume. In 2014, Four Seasons was awarded a CMMI grant to demonstrate the value of community-based palliative care with the goals of improving health outcomes, improving patient and family experience of care, improving access to care in rural service areas, reducing total costs of care, and helping to design an alternative payment model for palliative care.




Over the three years of the grant, approximately 5800 patients were enrolled. Many challenges were initially encountered in this demonstration project including how to define eligibility, how to standardize care across geographic areas, how to deliver high quality care to people who lived in remote service areas, and what interdisciplinary model offered the best service delivery. The model was scaled into upstate South Carolina and throughout western North Carolina and included patients in all care settings. Lessons learned included the importance of patient identification, risk stratification, standardized education of providers, and the importance of telehealth in rural service areas.


Community-based palliative care is an important delivery model that will allow people with serious illness to stay in their homes and receive the type of care that aligns with what matters most to them. Palliative care incorporates symptom management, advance care planning, goal-oriented care, and provides families with support from interdisciplinary teams. Telehealth allows for remote patient monitoring and virtual visits to help care for patients with serious illness especially in rural and remote service areas. Medication management with a virtual pharmacist on the team can be an important addition to improve care.




Pharmacists can help with deprescribing and drug -drug interactions which are common in people with multi co-morbidities. These types of services are possible under a capitated or alternative payment model.

In 2018, the American Academy of Hospice and Palliative Care formed a stakeholder group to develop the Patient and Caregiver Support for Serious Illness, or PACSSI model as an Alternative Payment model for palliative care. Data from patients enrolled in Four Seasons CMMI grant was used to help inform the alternative payment model. In March 2018, the model was presented to the Physician Technical Advisory Panel who recommended the model for limited scale testing, stating “the need for palliative care services for Medicare beneficiaries is urgent and that such care can only be provided by changes to the Medicare payment policy.”


In addition, there are new and future changes that affect Medicare Advantage patients, which compose 32% of all Medicare recipients in North Carolina. The first is a reinterpretation of “supplemental benefits” and the second is the Chronic Care Act, both which will increase the ability to supplement services such as palliative care into the home setting.


Under an alternative payment model, reimbursement is not related to evaluation/management codes as it is under a fee for service model. Capitated or monthly payments would allow teams to care for people in the way that best meets their needs. This includes incorporating social workers, behavioral health specialists, pharmacy care, nurse case management, and telehealth as needed. In other words, customizing the care to best align with the needs of the patient and family.


Isn’t that what good care should be about? Providing the right resources at the right time in the right care setting. Under this type of reimbursement, palliative care which is not currently sustainable in the community setting, suddenly becomes a reality and one that can support itself financially.


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The 21st Century is going to bring some of the most daunting challenges that the U.S. healthcare industry has ever faced. Healthcare desperately needs innovation, not just in processes and tools, but in leadership development. We need leaders who can imagine a better future, leaders who remember that the promises we make to our communities and to those we serve, is our reason for being. In that reason, that promise of caring for others, we find our core values that tell us that when we care and invest in our people, our leaders, at all levels of the organization, we make them better than they ever thought possible. When we develop our leaders, healthcare will be better than anyone could have ever imagined, and we will be prepared to climb the mountain of challenges ahead.

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