Chronic diseases are long-lasting conditions like Alzheimer’s disease, asthma, cancer, diabetes and hypertension that can be controlled but not cured. The Centers for Disease Control and Prevention says chronic diseases lead to seven of ten deaths each year and account for 86% of America’s healthcare costs.1 Care for people with multiple (two or more) chronic conditions represents about 71% of total U.S. healthcare spending and 93% of total Medicare spending.2

Chronic care management is defined by the Centers for Medicare & Medicaid Services (CMS) as non-face-to-face services provided to Medicare beneficiaries who have multiple significant chronic conditions.3 In January 2015, CMS began reimbursing clinicians for providing non-face-to-face care coordination services to Medicare’s sickest beneficiaries under CPT code 99490. This move offered hospitals and physician practices an unprecedented opportunity to improve care, better manage populations and ultimately boost the bottom line, yet only 13% of participants in a recent study have actually filed a 99490 claim and been paid.4 Is the chronic care management opportunity real? If so, why aren’t more providers getting on board?

The chronic care management market is big and growing

To qualify for the approximate $40 per month reimbursement, Medicare patients must have two or more chronic conditions and have a 20 minute non face-to-face monthly visit. If every single patient with two or more conditions, which totals to 36 million beneficiaries, enrolled in a chronic care management program this would equate to a chronic care management market valued $17.2 billion annually. And with private payers now starting to also pay for 99490, the market could swell to $51 billion annually.6

More realistically, if you do the math, if just 30% of the 36 million eligible patients participate in chronic care management programs, multiply that number by the approximate $40 per member per month reimbursement, then the market could easily surpass $5 billion per year. When you consider CMS’ prediction that the number of people with multiple chronic conditions will reach almost 80 million by 2030, the potential opportunity for providers is extraordinary.7

Obstacles to opportunity

Although the chronic care management program launched last year, CMS only paid qualifying physicians just $12 million through CPT code 99490 in 2015. This means 275,000 patients received services an average three times a year, well below the estimated 35 million eligible Medicare beneficiaries.8 There are a number of reasons for the slow start, including:

  • Providers confuse the CMS chronic care management program with accountable care organizations, multipurpose senior service programs, patient-centered medical homes and other programs to improve care management.
  • Providers see chronic care management as a complicated program that adds to their burden rather than easing it.
  • Healthcare practices are not set up for non-face-to-face care coordination.
  • Doctors have to get patients’ permission to put them in the program and patients are responsible for a 20% copay every time their provider bills for chronic care management services.
  • Providers haven’t adequately been educated on chronic care management billing rules.
  • Providers don’t have the technology or resources to automate the process of identifying and notifying qualified patients, managing the care team workflow and billing CMS.
How to move forward with chronic care management

Chronic care management is valuable to hospitals and practices, as a way to improve patient care and rein in chronic care costs. It is also a low-risk way to gain experience and proficiency with population management and value-based reimbursement, essential since CMS has announced a goal to convert at least 50% of Medicare payments to value-based reimbursement models by 2018.9

Providers who decide to seek reimbursement for CPT code 99490 need to think carefully about how to handle the duties of managing eligible populations. The time demands, for example, are significant. At the center of the 99490 program is a 20-minute minimum per patient per month consultation via telephone, Internet or other telemedicine setup. A practice consulting with 200 patients monthly would require 60+ hours of staff time, or more than three hours a day.

How to accommodate the technology demands of code compliance is another consideration. Providers must fulfill CMS requirements like meaningful use and the Physician Quality Reporting System and meet the day-to-day obligations of clinical documentation, coding and revenue cycle management. For physician groups already at capacity juggling regulatory and administrative responsibilities, chronic care management can be unmanageable.

The decision to have an in-house chronic care management program boils down to two questions:

  1. Can the hospital or practice consistently and appropriately meet all compliance requirements?
  2. Will it be profitable?

If the answer to either question is unclear, providers should give serious thought to outsourcing their chronic care management program. Outsourcing to a qualified, experienced vendor can assist with most of the intermediate and ongoing steps to satisfy chronic care management requirements. Significantly, this includes the 20-minute per patient per month consults. A skilled vendor can also offer a full spectrum of services, some of which must be conducted or provided by trained clinicians.

Learn more about how to implement chronic care management to help improve your bottom line and put you on the path to value-based care.

1Chronic Disease Prevention and Health Promotion, Centers for Disease Control and Prevention, Aug. 16, 2016.
2Multiple Chronic Conditions, Centers for Disease Control and Prevention, last updated Jan. 20, 2016.
3Chronic Care Management Tool Kit, American College of Physicians, 2015.
4“Chronic care management: Is the $50 billion market more hype than reality?” Tom Sullivan, April 26, 2016.
5 Ibid.
6 Ibid.
7 Ibid.
8 “Medicare’s CCM Telehealth Program Gets a Bit of Good News,” Eric Wicklund, July 25, 2016.
9“Better Care. Smarter Spending. Healthier People: Paying Providers for Value, Not Volume,” Centers for Medicare & Medicaid Services fact sheet, Jan. 26, 2015. 

Bill Sillar

About the author

Bill Sillar is National Channel Manager for McKesson Business Performance Services, supporting McKesson’s value-based care services. Sillar has been with McKesson for 10+ years and has played a pivotal role in helping healthcare organizations bridge the gap as they transition from a fee-for-service to a value-based reimbursement payment model.