cpas & advisors · • value-based purchasing • hospital readmissions reduction program ......
TRANSCRIPT
experience support //
CPAs & ADVISORS
SUCCEEDING AT RISK-BASED CARE: EPISODIC VALUATION
Eric. M. Rogers MEd. RT(R)
OBJECTIVES
The Changing Health Care Market
ACOs
Bundled Payment
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-$4
-$14-$21
-$25-$32
-$42
-$53
-$64
-$75
-$86
$467BHospital payment cutsDSH Sequestration
ACA’s Medicare FFS payment cuts (in $ Billions)
2013 2018 2022
The changing health care market
MEDICARE PAYMENT CUTS CHARTING THE COURSE
Source: CBO, “Estimated Impact of Automatic Budget Enforcement Procedures Specified in the Budget Control Act,” September 12, 2011; CBO Emerging Era of Choice ; Advisory Board
OUTCOMES BASED REIMBURSEMENT
6% currently at risk through Pay for
Performance (P4P) FY 2017
• Value-Based Purchasing
• Hospital Readmissions Reduction Program
• HAC Program
MIPS solution to annual SGR repeal will also replace sun setting P4P programs
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Quality30%
Resource Use30%
MU25%
Clinical Practice
Improvement15%
The changing health care market
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0
10
20
30
40
50
60
70
80
90
100
2011 2015 2016 2018
FFS APMs
HHS goal of 30% of traditional FFS Medicare payments through Advanced Payment Models (APMs) by the end of 2016 and 50% by the end of 2018
THE CHANGING HEALTH CARE MARKET
The changing health care market
MEDICARE’S ROAD TO RECOVERY
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Phase 1
FFS with no link to quality
Phase 2
FFS with link to quality
Phase 3
APM built on FFS framework
Phase 4
Risk-based payments
Success requires participating in the right mix of
volume and value
The changing health care market
CMMI INNOVATION MODELS
AccountableCare
BPCI Primary Care Transition
Medicaid and CHIP
Acceleration Models
Speed Adoptionof Best Practices
ACOs Model 1 Advanced Primary Care Initiative
Reduce Avoidable Hospitalizations
State Innovation Models
Beneficiary Engagement Model
Advanced PaymentACOs
Model 2 Comprehensive Primary Care Initiative
Financial Alignment Incentive for Medicare and Medicaid
Frontier Community Health Integration
Community BasedCare Transitions
ACO Investment Model
Model 3 FQHC AdvancedPrimary Care Practice
Strong Start forMothers and Newborns
Health Care Innovation Rounds
Health Care Actionand Learning Network
Next Generation ACO
Model 4 Graduate Nurse Education
MedicaidPrevention of Chronic Diseases
Health PlanInnovation Initiative
Innovative Advisors Program
Pioneer ACO Transforming Clinical Practice
Medicaid Emergency Psychiatric Demonstration
Million Hearts
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The changing health care market
CCJR
MEDICARE ADVANTAGE
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The changing health care market
MEDICARE ADVANTAGE
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The changing health care market
AFFORDABLE CARE ACT
King v BurwellDeclining number of uninsured
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The changing health care market
State Participation in Medicaid Expansion As of February 2015
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The changing health care market
Not ParticipatingParticipating Expansion by Waiver
Source: Kaiser Family Foundation, “Current Status of State Medicaid Expansion Decisions,” January 27, 2015, available at: http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/; CMS, “Medicaid and CHIP image courtesy of Advisory Board
OPTIONS FOR EMPLOYERS
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The changing health care market
3M
9M
19M
30M
40M
2014 2015 2016 2017 2018
Drop Coverage Shift to Private Exchange Self-Fund
Projected private exchange enrollment
49%
54%
59%61%
40%
45%
50%
55%
60%
65%
70%
2000 2005 2010 2014
Percentage of covered workers in self-funded plansSource: Accenture, “Are You Ready? Private Health Insurance Exchanges are Looming;” privatehealthexchange.com; Health Care Advisory Board interviews and analysis.
HEALTH DESIGN PLUS
Centers of Excellence programs for self-funded employers
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The changing health care market
Johns Hopkins
Mercy
Kaiser
Virginia Mason
Source: Walmart, “Walmart, Lowe’s And Pacific Business Group On Health Announce A First Of Its Kind National Employers Centers Of Excellence Network,” October 8, 2013;
“Our goal is to be the number one healthcare provider in the industry.”
Labeed DiabPresident of Health & Wellness, Walmart
Yesterday’s Model
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The changing health care market
Today’s Model
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The changing health care market
OBJECTIVES
The Changing Health Care Market
ACOs
Bundled Payment
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5%
High Risk
35% - 40%
Medium Risk
50%
Low Risk
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ACO
Characteristics
• Super utilizers• Multiple chronic conditions, frail, elderly• Frequent hospitalizations, ER visits• Behavioral health, socioeconomic barriers• 40% - 50% of total cost
• Limited and stable chronic conditions• At risk for procedures• 30% - 40% of total cost
• Healthy• Minor health issues• 10% - 20% of total costs
High-Impact Care Priorities
• Care coordinators• Address behavioral and
socioeconomic barriers• Community resources• Intense transition planning• Frequent one-on-one planning
• Reduce practice variation• Systematic care and evidence-
based medicine• Team-based, coordinated care• Top of license mentality
• Focused coordination and prevention
• Movement toward virtual, mobile, anytime access
• Convenience
• Healthy• Minor health issues• 10% - 20% of total costs
Recipe for Disaster
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ACO
Do It All
Own It All
Buy the Perfect IT Solution
Bring in a New Workforce
OBJECTIVES
The Changing Health Care Market
ACOs
Bundled Payment
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HISTORY
1960 Jerry Solon Delineating Episodes of Medical Care
“To order and cluster these [same] units of care systematically into unities or nodes of medical care addressed to a medical problem or health objective is to bring the meaning and purpose of the services into clear perspective. The concept of medical care episodes is proposed as a new dimension for representing medical service utilization. The delineation of episodes takes into account the following:”
1. The patient’s medical problem or situation
2. The time intervals between services
3. The nature of the medical management
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Bundled Payment
HISTORY
2006 Heart Surgery with a 90-day WarrantyGeisinger Health System
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Bundled Payment
“ProvenCare” model for coronary artery bypass surgery bundled best practices, patient engagement, preoperative, inpatient and postoperative care (rehospitilizations) within 90 days into a packaged fixed price.
HISTORY
2007 PROMETHEUS Provider payment Reform for Outcomes, Margins, Evidence, Transparency,
Hassle-reduction, Excellence, Understandability and Sustainability”
Developed “evidence-informed case rates” for various conditions that are adjusted for severity and complexity of a patient’s illness. Case rates would be used for setting target prices for episodes of care.
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Bundled Payment
HISTORY
2008 ACE Demonstration Medicare Acute Care Episode
CMS develops new project for bundling payment on certain cardiovascular and orthopedic procedures. Bundle includes hospital and physician charges with an automatic 1%-6% discount. Medicare beneficiaries could receive $250- $1,175 in incentives for receiving procedures in participating hospitals.
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Bundled Payment
Senator Max BaucusChair of Senate Finance Committee
November 2008 white paper recommended that the ACE Demonstration be:
Expanded to other sites
Focus on other clinical conditions
Include services that are provided post-discharge
HISTORY
2013 BPCI Bundled Payments for Care Improvement
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Bundled Payment
Model 2
Retrospective acute care
hospital stay + post-acute
care
Model 1
Retrospective acute care
hospital stay
Model 3
Retrospective Post-acute
care
Model 4
Acute-care hospital stay
48 episodes
2 phases
BPCI POPULARITY
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Bundled Payment
Source: CMMI Website
0
1000
2000
3000
4000
5000
6000
7000
Participants in CMMI Payment Models
OVERVIEW
Model 1 Model 2 Model 3 Model 4
Description Retrospective acute care hospital stay
Retrospective acute care hospital stay + post-acute care
Retrospective post-acute care
Acute care hospital stay
Scope Entire hospital Up to 48 episodes Up to 48 episodes Up to 48 episodes
Services All Part A paid as part of DRG payment
All non-hospice Part A & B for IP, PAC and readmissions
All non-hospice Part A & B during PACand readmissions
All non-hospice Part A & B during initial IP stay and readmissions
Payment Retrospective Retrospective Retrospective Prospective
Discount 0.5% and increasing 2% - 3% 3% 3% - 3.5%
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Bundled Payment
FEASIBILITY
Areas Evaluated Sample Impact
Discount ($300,000)
Other program costs ($100,000)
Reducing LOS $500,000
Reducing readmissions $200,000
Reducing supply costs $1,000,000
Gainsharing bonus potential ($600,000)
Net hospital impact $700,000
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Bundled Payment
PRICING THE BUNDLE
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Bundled Payment
Source: CMS CCJR Federal Register Proposal July 14, 206
BPCIspending variation
DRG 470
PRICING THE BUNDLE
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Bundled Payment
Source: Dobson /DaVanzo analysis of research-identifiable 5 percent SAF for all sites of service, 2007-2009, wage index adjusted by setting and geographic region in 2009 dollars.
PRICING THE BUNDLE
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Bundled Payment
Source: Dobson /DaVanzo analysis of research-identifiable 5 percent SAF for all sites of service, 2007-2009, wage index adjusted by setting and geographic region in 2009 dollars.
MANAGING THE BUNDLE
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Bundled Payment
Source: Dobson /DaVanzo analysis of research-identifiable 5 percent SAF for all sites of service, 2007-2009, wage index adjusted by setting and geographic region in 2009 dollars.
MANAGING THE BUNDLE
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Bundled Payment
Source: Dobson /DaVanzo analysis of research-identifiable 5 percent SAF for all sites of service, 2007-2009, wage index adjusted by setting and geographic region in 2009 dollars.
COMPREHENSIVE CARE FOR JOINT REPLACEMENT (CCJR)
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The changing health care market
July 9th 2015: CMS proposed mandatory joint replacement bundle
effectiveJanuary 2016
Hospitals at risk financially
90 day responsibility post discharge
Bottom line depends on quality
Gainsharing and waivers
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Lower Extremity Joint Replacement
42 CFR PART 510 [CMS-5516-P]
• 60-day public commenting period on proposal ended Sept 8th
• Effective January 1, 2016
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Better Care
Smarter Spending
Healthier People and Communities
WHAT IS THE CCJR MODEL DESIGNED TO DO FOR PATIENTS AND THE HEALTH SYSTEM?
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• Inpatient Prospective Payment System (IPPS) Hospitals
• Located in selected Metropolitan Statistical Areas (MSAs) performing at least 400 LEJR cases in a 1 year period.
PARTICIPANTS
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MSA SELECTION
75MSAs
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Texas Hospitals located in selected CCJR MSAs
ARISE AUSTIN MEDICAL CENTER
BAPTIST BEAUMONT HOSPITAL
CARE REGIONAL MEDICAL CENTER
CEDAR PARK REGIONAL MEDICAL CENTER
CENTRAL TEXAS MEDICAL CENTER
CHRISTUS HOSPITAL
CHRISTUS SPOHN HOSPITAL CORPUS CHRISTI
CORPUS CHRISTI MEDICAL CENTER,THE
COVENANT MEDICAL CENTER
EAST TEXAS MEDICAL CENTER
GRACE MEDICAL CENTER
LAKEWAY REGIONAL MEDICAL CENTER, LLC
LUBBOCK HEART HOSPITAL LP
MEMORIAL HERMANN BAPTIST ORANGE HOSPITAL
METROPLEX HOSPITAL
MOTHER FRANCES HOSPITAL
NORTH AUSTIN MEDICAL CENTER
NORTHWEST HILLS SURGICAL HOSPITAL
ROUND ROCK MEDICAL CENTER
SCOTT & WHITE HOSPITAL-ROUND ROCK
SCOTT & WHITE MEMORIAL HOSPITAL
SETON MEDICAL CENTER AUSTIN
SETON MEDICAL CENTER HARKER HEIGHTS
SETON MEDICAL CENTER HAYS
SETON MEDICAL CENTER WILLIAMSON
SETON NORTHWEST HOSPITAL
SETON SMITHVILLE REGIONAL HOSPITAL
SETON SOUTHWEST HOSPITAL
SOUTH TEXAS SURGICAL HOSPITAL
ST DAVID'S MEDICAL CENTER
ST DAVID'S SOUTH AUSTIN MEDICAL CENTER
TEXAS SPINE AND JOINT HOSPITAL
THE HOSPITAL AT WESTLAKE MEDICAL CENTER
THE MEDICAL CENTER OF SOUTHEAST TEXAS
TRUSTPOINT HOSPITAL
UNIVERSITY MEDICAL CENTER
UNIVERSITY MEDICAL CENTER AT BRACKENRIDGE
UNIVERSITY OF TEXAS HEALTH SCIENCE CENTER AT TYLER
• Episodes are triggered by hospitalizations of eligible Medicare FFS beneficiaries discharged with diagnoses: MS-DRG 469: Major joint replacement or reattachment of lower
extremity with major complications or comorbidities
MS-DRG 470: Major joint replacement or reattachment of lower extremity without major complications or comorbidities
• Episodes include: Hospitalization and 90 days post-discharge
All Part A and Part B services, with the exception of certain excluded services that are clinically unrelated to the episode
EPISODE DEFINITION: GENERAL
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• Enrolled in Medicare Part A and Part B throughout the duration of the episode
• Not eligible for Medicare on the basis of ESRD
• Not enrolled in a managed care plan
• Not covered under United Mine Workers of America health plan
EPISODE DEFINITION: BENEFICIARIES
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EPISODE DEFINITION: SERVICESIncluded
• Physician services• IP hospitalization (including
readmissions)• IP Psych Facility• LTCH• IRF• SNF• Home Health • Hospital OP services• Independent OP therapy• Clinical lab• DME• Part B drugs• Hospice
Excluded• Acute clinical conditions not arising
from existing episode-related chronic clinical conditions or complications of the LEJR surgery
• Chronic conditions that are generally not affected by the LEJR procedure or post-surgical care
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• Retrospective, two-sided risk model with hospitals bearing financial responsibility
Providers and suppliers continue to be paid via Medicare FFS
In Year 2, actual episode spending will be compared to episode target prices
• If in aggregate target prices are greater than spending, hospital may receive reconciliation payment
• If in aggregate target prices are less than spending, hospitals would be responsible for making a payment to Medicare
PAYMENT AND PRICING: RISK STRUCTURE
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• Target prices
CMS intends to establish target prices for each participant hospital prior to start of each performance period
Includes 2% discount to serve as Medicare’s savings
Based on blend of hospital-specific and regional episode data, transitioning to regional pricing.
PAYMENT AND PRICING: TARGET PRICE
2/3 hospital
1/3 regional
Year 1 & 2 1/3 hospital
2/3 regional
Year 3 100%
regional
Year 4 & 5
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$47,928
$52,028 $50,954
$46,189
$51,239 $50,328
$55,448
$47,925 $48,874
$24,858 $27,406
$25,480$23,800
$25,989 $26,345 $27,464
$23,734 $23,425
New England Middle Atlantic East NorthCentral
West NorthCentral
South Atlantic East SouthCentral
West SouthCentral
Mountain Pacific
DRG 469 DRG 470
REGIONAL HISTORICAL AVG CCJR PAYMENTS
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2013 HISTORICAL REIMBURSEMENT AVERAGES
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$25,600
$26,800
$27,464
Hospital X MSA Regional
DRG 470
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
Inpatient Outpatient Readmissions Home Health Skilled Nursing Physician
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LONGITUDINAL VIEW OF PROVIDER PAYMENTS
Home Health71%
Skilled Nursing17%
Other10%
Hospice2%
Hospital X DRG 470Post Acute Utilization
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LONGITUDINAL VIEW OF PROVIDER PAYMENTS
$15,226
$9,213
$2,787
$6,020 $4,517
$26,955
$8,796
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
SNF A SNF B SNF C SNF D
Avg Payments by SNF
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LONGITUDINAL VIEW OF PROVIDER PAYMENTS: SNF
Average SNF payment for
SE Health patients
$9,213
• Episode calculations capped at 2 standard deviations above regional mean
• Reconciliation payments capped at 20% of target prices (stop-gain)
• Hospital responsibility to repay Medicare phased-in and capped (stop-loss):
Year 1: No responsibility to repay Medicare
Year 2: Capped at 10% of target prices
Years 3-5: Capped at 20% of target prices
• Additional protection for rural, sole community (SCH), Medicare dependent (MDH), and rural referral center (RRC) hospitals
PAYMENT AND PRICING: RISK LIMITS AND ADJUSTMENTS
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UPSIDE AND DOWNSIDE FINANCIAL MODELING
10% Stop Loss
20% Stop Gain
$9,330,051 Reconciliation Target *$7,344,781
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9To
tal E
pis
od
es
$63,460
$53,516 (2X SD)
$21,338
Patient: 86 y/o white femaleDOS: September 15, 2013CC: Femur fractureDx: HTN,DM, Gout, LeukocytosisS/P: IP Rehabilitation (x3), Skilled Nursing services (x2), Home health services, OP services.
Episode # 324 of 359
SPENDING BY AGE AT HOSPITAL X
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$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
0-60 61-65 66-70 71-75 76-80 81-85 85-90 91-95
USING DATA TO REDESIGN CARE
DRG 470: TOTAL HIP VS PARTIAL HIP
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USING DATA TO REDESIGN CARE
DRG 470: TOTAL HIP VS PARTIAL HIP
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$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
Total Partial
USING DATA TO REDESIGN CARE
• Minimum threshold for 3 quality metrics
1. Hospital Level Risk Standardized Complication Rate (RSCR)
2. Hospital Level 30 day, All Cause Risk Standardized Readmission Rate (RSRR)
3. HCAHPS
• Thresholds for performance would increase over the lifetime of the model to incentivize continuous improvement
PAYMENT AND PRICING: LINK TO QUALITY
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• Hospitals in BPCI Model 1 or Phase II of BPCI Models 2 or 4 for lower joint replacement would remain in BPCI and not be required to participate in CCJR. However, if they drop out of BPCI Phase II they would be required to participate in CCJR.
• BPCI Model 2 and Model 3 LEJR episodes initiated by participating physician group practices or post-acute care facilities would take precedence over CCJR episodes.
• Hospitals selected to participate in CCJR may also participate in an ACO or other model.
OVERLAP WITH BPCI & ACO
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• Consistent with applicable law, participating hospitals might have certain financial arrangements with Collaborators to support their efforts to improve quality and reduce costs.
• Collaborators may include: Physician and non-physician practitioners
Home health agencies
SNF
LTCH
Physician group practices
IRF
Inpatient and Outpatient PTs and OTs
FINANCIAL ARRANGEMENTS: GAINSHARING
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COLLABORATORS AND GAINSHARING
Post Acute Providers
Physicians
Hospital
Finding high-value collaborators
$-
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
Doc A Doc B Doc C Doc D
Physicians
Gainsharing
• Participant hospitals can share in:
Reconciliation payments in the form of a performance-based payments
Internal cost savings realized through care redesign activities associated with CCJR services
• Collaborators would be required to engage with the hospital in its care redesign strategies and to furnish services during a CCJR episode in order to be eligible for such payments.
FINANCIAL ARRANGEMENTS: INCENTIVE PAYMENTS
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• Participant hospitals may assign various percentages of two-sided risk to collaborators.
CMS would continue to make reconciliation payments and recoupments solely with the hospital.
The hospital would be responsible for paying/recoupingfrom its collaborators.
• CMS proposed to limit the hospital’s sharing of risk to 50% of the total repayment amount to CMS.
FINANCIAL ARRANGEMENTS: RISK SHARING
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• Hospitals might offer certain items or services to beneficiaries during a CCJR episode (consistent with applicable law)
Be provided during a CCJR episode of care
Be closely related to the provision of high quality care during the episode
Not be more valuable than necessary
Not serve as an inducement
BENEFICIARY INCENTIVES
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• Some financial arrangements may implicate the federal fraud and abuse laws, however, CMS may consider whether waivers are necessary to test the CCJR model
Any waivers would be given separately by the OIG and CMS
FINANCIAL ARRANGEMENTS: WAIVERS
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• Skilled Nursing Facility
CCJR would waive the SNF 3-day rule for coverage of a SNF stay following the anchor hospitalization beginning in Year 2
Patients must be transferred to SNFs rated 3-stars or higher
Beneficiaries must not be discharged prematurely to SNFs
• Home Visits
CCJR would waive the “incident to” rule for physician services
Allows the licensed clinical staff of a physician to furnish a home visit in the patient’s home
Permitted only for patients who do not qualify for Medicare coverage of home health services
Maximum of 9 visits using a new HCPCS code
• Telehealth
Waives the geographic site requirement and the originating site requirement to permit visits originating in the patient’s home or place of residence
Cannot be a substitute for in-person home health services
Must be furnished in accordance with all other Medicare coverage and payment criteria
PROGRAM WAIVERS
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• Specifications Data will be shared to evaluate practice patterns, redesign care delivery
pathways and improve care coordination.
Hospitals can request to obtain beneficiary-level Part A and B claims for the duration of the episode in summary format, raw claims line feeds, or both.
Data would be available for the hospital’s baseline period and on a quarterly basis during the performance period.
Aggregate regional claims data for MS-DRG 469 and 470 would also be shared
• Privacy Data sharing would fully comply with laws and regulations pertaining to
security
Patients would be notifies and afforded the opportunity to decline havign their data shared with a hospital
DATA SHARING
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• Patient’s access to care would not be impacted by the CCCJR model. Copays would not change
Patient provider relationships would be maintained
Patients retain entitlement to Medicare covered services
ACCESS TO CARE
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• Beneficiary protection Providers and suppliers would be required to notify patients of the
payment model.
• Monitoring CMS will monitor compliance with the model requirements
CMS will monitor potential risks
• Increasing profitability by delaying care
• Decreasing costs by avoiding medically indicated care
• Avoiding high cost patients
• Compromised quality or outcomes
OTHER ITEMS
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Governance and Oversight
Data AnalyticsCollaborators
and Gainsharing
Care Redesign
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PROJECT PLAN AND DELIVERABLES
THANK YOU
FOR MORE INFORMATION // For a complete list of our offices
and subsidiaries, visit bkd.com or contact:
Eric M. Rogers M.Ed. RT(R) // Managing [email protected] // 417.865.8701
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