• rss
  • facebook
  • twitter
  • linkedin

Medicare Medical Home Demonstration Project

On April 14, 2011, CMS made the following announcement about the status of this demonstration project:

CMS is currently testing the patient-centered medical home model in the Multi-payer Advanced Primary Care Practice Demonstration and the Federally Qualified Health Centers Advanced Primary Care Practice Demonstration. CMS also plans to test the patient-centered medical home model under the Innovation Center created by Section 3021 of the Patient Protection and Affordable Care Act, which provides CMS with an opportunity to test a variety of models and expand their implementation nationwide if they reduce spending without reducing quality or improve quality without increasing spending, and if the CMS Chief Actuary certifies that their expansion would be budget neutral, and if the Secretary determines that such an expansion would not result in denying or limiting coverage or the provision of benefits. Therefore, CMS plans not to pursue implementation of the Medicare Medical Home Demonstration specified in section 204 of the Tax Relief and Health Care Act of 2006 as modified by section 133(a)(2) of the Medicare Improvements for Patients and Providers Act of 2008.

For current information on CMS medical home projects and other initiatives, you can sign up for updates on Innovation Center initiatives on its website, located at: http://innovations.cms.gov/.



The Medicare Medical Home Demonstration project was authorized in Section 204 of the Tax Relief and Health Care Act of 2006 and attempts to redesign the health care delivery system to provide targeted, accessible, continuous and coordinated, family–centered care by a personal physician practicing in a medical home to Medicare beneficiaries with qualifying chronic conditions (see complete list of qualifying chronic conditions).

The 3-year demonstration project will provide reimbursement in the form of a care management fee to physician practices for the services of a “personal physician.” The legislation directed CMS to use the relative values scale update committee (RUC) process to establish the care management fee codes for care management fees. The RUC made its recommendations to CMS for the Medicare Medical Home Demonstration in April 2008.



Demonstration Design

CMS contracted with Mathematica Policy Research (MPR) to prepare option papers pertaining to defining a medical home and patient eligibility, among other topics.

CMS shared those papers with ACP and the American Academy of Family Physicians, the American Academy of Pediatrics, the American Osteopathic Association, the American Medical Association, and others for comment.

These option papers were then used to develop a draft demonstration design paper. The Medicare Medical Home Demonstration design was also presented in a Special Open Door Forum on October 28, 2008.



Physician Eligibility

Physician practices:
  • Including internal medicine, family practice, geriatrics, general practice, specialty and sub-specialty practices (except where specifically excluded).

  • Excluding radiology, pathology, anesthesiology, dermatology, ophthalmology, emergency medicine, chiropractic, psychiatry, and surgery.



Definition of a Medical Home

The CMS Medicare Medical Home Demonstration project has defined a two-tier medical home model with increasing levels of capability:

  • Achieving medical home status at either of the tiers represents an expectation that the practice has the capability and the intention to provide a certain level of care management and coordination services to patients in the demonstration.

  • Six general domains and up to 28 specific core capabilities.

Tier 1 or “typical” medical home must have 17 basic medical home capabilities, such as:

  • Uses health assessment plan
  • Uses integrated care plan
  • Tracks tests and provider follow-up
  • Reviews all medications
  • Tracks referrals

Note: Although the scoring of the PPC-PCMH-CMS is different from the PPC-PCMH being used in the commercial market, Tier 1, as defined by CMS, tracks more closely with level 2 recognition for the commercial PPC-PCMH.

Tier 2 or “enhanced” medical home must meet Tier 1 requirements plus 2 additional capabilities (electronic medical record and coordination of care including follow-up of inpatient and outpatient care), plus three of nine optional capabilities.

Practices will qualify for medical home status on the basis of documentation submitted using the Physicians Practice Connections/Patient-Centered Medical Home instrument (developed and owned by NCQA), modified as necessary for the Medicare demonstration.

  • NCQA has licensed to CMS without cost for use in the demonstration, including instructions for submission.

  • Can be submitted electronically or on paper.

Note: Although the scoring of the PPC-PCMH-CMS is different from the PPC-PCMH being used in the commercial market, Tier 2, as defined by CMS, tracks more closely with level 3 recognition for the commercial PPC-PCMH.

Practices that qualify for Tier 1 may later move up to Tier 2 by submitting documentation of their additional qualifications.

Resources for Further Information on the CMS Medical Home Definition:



Patient Eligibility

Coverage eligibility:
  • Medicare Part A & B, fee-for-service
  • Medicare as primary coverage
Disease eligibility:
Other eligibility:
  • Patients who enter nursing home while participating in demonstration (as long as the patient continues to receive primary care services from the medical home)
  • Patients who “recover” from a qualifying chronic condition while participating in medical home
  • Enrolled in a Medicare Advantage Plan
  • Current hospice patients
  • Current nursing home patients
  • Participating in other Medicare demonstrations



Monthly Medical Home Fees

Proposed Medical Home Demonstration Per Patient Per Month Payment Rates, Overall and By Patient Heirarchal Condition Code (HCC) Score

Medical Home Tier Per Member Per Month Payments Patients with HCC Score < 1.6 Patients with HCC Score = 1.6
Tier 1 $40.40 $27.12 $80.25
Tier 2 $51.70 $35.48 $100.35


  • Fees are adjusted using the Hierarchal Condition Code (HCC) scores to reflect severity and burden to the physician.
  • HCC scores < 1.6 represent beneficiaries who are less ill and require less physician effort to manage. Those with scores > 1.6 are considered more ill and require more physician effort to manage the patient.

The monthly medical home fees listed above are based on recommendations made by the Relative Value Scale Update Committee (RUC).



Payment Process

CMS has contracted with Palmetto Government Benefits Administrator (Palmetto GBA) to make monthly payments for each eligible, enrolled beneficiary to the Medical Home practice that they have agreed to provide their Medical Home care. This payment is made automatically each month in addition to any covered Medicare services the beneficiary receives during that time.

Palmetto GBA will verify beneficiary eligibility each month prior to making payments. Beneficiaries who choose not to participate, or become ineligible due to changes in coverage or death will be deleted from their Medical Home’s patient roster. Adjustments will be made for all monthly payments made to practices while the beneficiary was not eligible.



Site Selection

CMS expects to announce site selection in 2009 and anticipates the demonstration will be implemented in all or parts of 8 States. More detailed site selection criteria are listed below.

Site Selection Criteria:
  • Section 204 of the Tax Relief and Health Care Act of 2006 specifies that the Medical Home Demonstration will be conducted in no more than 8 states. Locations are to include urban, rural and underserved areas.

  • CMS anticipates soliciting 50 practices in each of 8 sites for a total of 400 practices.

  • CMS will choose sites that will provide good geographic distribution across the country and do not have other CMS demonstration projects in which contamination of comparison groups could occur.

  • Sites must have a sufficiently large Medicare fee-for-service population with both Part A and Part B coverage and not enrolled in Medicare Advantage.

  • Sites must provide a sufficient physician-based practice pool from which to recruit 400 practices.

  • CMS expects to include 2,000 physicians from all practices participating in the demonstration.

  • CMS would prefer sites that are high Medicare cost areas because there is greater potential for better care management of chronically ill beneficiaries to produce savings.

  • CMS would prefer sites that have private payer Medical Home demonstrations occurring as it is expected to help in recruiting physician practices.



Implementation Schedule (as of January 2009)

  • CMS has contracted with Thomson/Reuters (Healthcare) Inc. to assist in implementing the recruitment, application, qualification, and patient enrollment activities.

  • CMS will begin soliciting practices to participate in the demonstration immediately following approval to conduct the demonstration.

  • Applications from interested practices will be accepted for at least a 3-month period.

  • Eligible practices will be notified to submit their qualification (recognition) survey and documentation and be evaluated as Medical Homes by NCQA. Applicants will be notified of their evaluation status immediately following the Medical Home qualification review.

  • Practices can begin enrolling qualified beneficiaries and submit Acceptance/Agreement forms immediately upon being qualified as a Medical Home.

  • Payment of the monthly Medical Home fee to qualified practices will begin January 2010 and continue through December 2012.



Additional Information and Resources


[PDF] Acrobat PDF format. Download Acrobat Reader software for free from Adobe. Problems with PDFs?

Do You Need Help Becoming a Patient Centered Medical Home?

Learn about how this product can help.

What's New

New Study: Total Cost of Care Lower among Medicare Fee-for-Service Beneficiaries Receiving Care from Patient-Centered Medical Homes

August 9, 2014: A new, independent research study, conducted by RTI International and published in the Health Services Research journal, adds to the evidence that accredited patient-centered medical homes (PCMHs) deliver lower cost and drive more appropriate health care utilization. The study focused on participants in the Medicare Fee-for-Service (FFS) program, comparing 308 PCMHs recognized by the National Committee for Quality Assurance (NCQA) with a sample of nearly 2,000 non-accredited PCMHs across three years, beginning in July of 2008.

Recognized PCMH Practices


Website: www.ncqa.org/

Internal Medicine Meeting 2015 Digital Presentations

Internal Medicine Meeting 2015 Digital Presentations

Choose from over 170 recorded Scientific Program Sessions and Pre-Courses. Available in a variety of packages and formats so you can choose the combination that works best for you.

See all available packages or preview sessions.

Medical Student Text

IM Essentials Now Available in Print or Online
IM Essentials Now Available in Print or Online

Check out sample pages from IM Essentials Text and IM Essentials Questions.