Direct Contracting Model
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Centers for Medicare and Medicaid Services
Building on lessons learned from initiatives involving
Medicare Accountable Care Organizations, the Direct
Contracting Model is a set of 3 voluntary payment model
options designed to reduce expenditures and preserve and
enhance quality of care for Medicare fee-for-service
This model provides new opportunities for a variety of
different organizations to participate in value-based
care arrangements in Medicare FFS, including
organizations without significant experience in FFS.
Direct Contracting seeks to improve quality of care and
health outcomes for Medicare beneficiaries through
alignment of financial incentives to promote effective
and appropriate care, emphasis on patient choice, strong
monitoring to ensure that beneficiaries maintain access
to care, and emphasis on care delivery for the complex,
chronically and seriously ill population.
Specific information on model options is available in the
Eligible participants are legal entities that contract
with Direct Contract Participant Providers, including,
but not limited to:
- Physicians and other practitioners in group practice
- Networks of individual practices of physicians and
- Hospitals employing physicians and other
- Federally Qualified Health Centers (FQHCs)
- Rural Health Clinics (RHCs)
- Critical Access Hospitals (CAHs)
Amount of funding
Payment options will be provided to 3 types of Direct
Contracting Entities (DCEs) with different
characteristics and operational parameters.
Standard DCEs - Organizations that
have experience serving Medicare FFS beneficiaries
New Entrant DCEs - Organizations that
have not traditionally provided services to a Medicare
High Needs Population DCEs -
Organizations that serve Medicare FFS beneficiaries
with complex needs
The model will be tested over 6 years.
Access · Accountable Care Organizations · Critical Access Hospitals · Federally Qualified Health Centers · Healthcare facilities · Healthcare quality · Medicare · Reimbursement and payment models · Rural Health Clinics · Service delivery models
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