HHS Launches New Oncology Care Model

The Department of Health and Human Services (HHS) on February 12 announced a new care delivery model to support better care coordination for cancer care called the Oncology Care Model (OCM). This initiative is the second program announced as part of HHS' new "better care, smarter spending, healthier people" approach to healthcare and promotes models of care developed by the Centers for Medicare & Medicaid Innovation (CMMI).

The OCM is a multi-payer model in which practices will enter into payment arrangements that include financial and performance accountability for episodes of care surrounding chemotherapy administration to cancer patients. This model aims to provide higher quality, more highly coordinated oncology care at a lower cost. It is a five-year model that will begin in spring 2016.

The OCM intends to improve health outcomes, produce higher quality care, and lower costs by utilizing aligned financial incentives such as performance-based payments to:

Improve care coordination;

Ensure appropriateness of care; and

Increase access for beneficiaries receiving chemotherapy. The goal of the OCM is to reduce healthcare costs as participating practices more effectively address the complex care needs of the cancer patients, increase use of high value services, and decrease use of unnecessary services.

According to CMS, "The Oncology Care Model encourages participating practices to improve care and lower costs through episode-based, performance-based payments that financially incentivize high-quality, coordinated care. Participating practices will also receive monthly care management payments for each Medicare fee-for-service beneficiary during an episode to support oncology practice transformation, including the provision of comprehensive, coordinated patient care."

Oncology group practices and individual practitioners who provide chemotherapy treatment to cancer patients and are currently enrolled in the Medicare program are eligible to participate in the initiative; however, they must meet the following criteria:

Provide the core functions of patient navigation;

Document a care plan that contains the 13 components in the Institute of Medicine Care Management Plan outlined in the Institute of Medicine report, "Delivering High-Quality Cancer Care: Charting a New Course for a System in Crisis";

Provide 24 hours a day, 7 days a week patient access to an appropriate clinician who has real-time access to practice's medical records;

Treat patients with therapies consistent with nationally recognized clinical guidelines;

Use data to drive continuous quality improvement; and

Use an ONC-certified electronic health record and attest to Stage 2 of meaningful use by the end of the third model performance year.

MARCH 2015

To apply for participation in the OCM, practices and payers must submit Letters of Intent (LOIs) to CMMI. LOIs for interested practices are due by 5:00 pm EDT on April 23, 2015. The names of applicants submitting LOIs will be posted publicly to facilitate cooperation between payers and practices prior to model implementation. Providers that submit timely, complete letters of intent (LOIs) will be eligible to submit applications for OCM participation. All applications must be submitted by 5:00 pm EDT on June 18, 2015.

For OCM application materials and submission deadlines, click here.

To read the CMS press release on the initiative, click here.

To download the CMS Fact Sheet, click here.

President Obama Releases FY2016 Budget Proposal

President Obama released his FY2016 Budget on February 2, which totaled $4 trillion and included more than $400 billion in Medicare cuts. The President's Budget also proposes changes related to the Medicare physician payment system and payment parity reforms for services provided in both the hospital outpatient department and physician office setting.

Regarding these proposals, the Budget specifically states:

Reforming Medicare Physician Payments to Encourage High-Quality, Efficient Care Cost Estimate: $44 billion over 10 years

The Budget adopts the following policies for reforming the way Medicare pays physicians, consistent with recent bipartisan, bicameral legislation:

Terminates the Sustainable Growth Rate formula for updating physician payments;

Provides a period of stability while promoting participation in alternative payment models that encourage high quality, efficient care; and

Streamlines value-based incentives for those physicians remaining outside of alternative payment models. Encourage Efficient Care by Improving Incentives to Provide Care in the Most Appropriate Ambulatory Setting Savings Estimate: $29.5 billion over 10 years The Budget proposes to improve incentives to provide ambulatory care in the most appropriate clinical setting. Evidence suggests that, in recent years, billing of many ambulatory services has been shifting from physicians' offices to the usually higher-paid hospital outpatient department setting, increasing Medicare spending and beneficiary cost-sharing. This proposal helps mitigate the financial implications of this trend by lowering payment for services provided in off-campus hospital outpatient departments under the Outpatient Prospective Payment System to either the Medicare Physician Fee Schedule-based rate or the rate for surgical procedures covered under the Ambulatory Surgical Center payment system. These changes would be phased in over four years beginning in CY 2017, and Secretarial authority would be provided to adjust payments in the event beneficiary access problems arise.

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Other Medicare provisions are included below:

To download the President's Budget Summary Tables, click here.

To download the HHS FY2016 Budget in Brief, click here.

CBO Increases SGR Replacement Cost by $30.5 Billion

The Congressional Budget Office (CBO) released new price estimate for the bipartisan, bicameral proposal to repeal and replace the sustainable growth rate formula, or SGR, on February 5. The new estimates increased the cost by $30.5 billion from the projected costs released last November.

The CBO estimates that the compromise legislation approved by the Senate Finance, House Energy & Commerce and House Ways & Means Committees last year would cost $174.5 billion from fiscal 2015 to 2025. In November, CBO put the price tag at $144 billion from fiscal 2015 to 2024.

Physicians treating Medicare beneficiaries face an approximate 21 percent payment cut if Congress doesn't act before March 31.

Medicare Providers 10-year cost (or savings) in $ billions

Exclude radiation therapy, advanced imaging, pathology and therapy services from the in-office ancillary services exception unless a practice is clinically integrated and demonstrates cost con-tainment

(6.0)

Repeal the SGR in a manner consistent with the recent bipartisan, bicameral legislation 44

Incentivize care in the most appropriate ambulatory setting (29.5)

Make permanent the Medicare primary care incentive payment; budget neutral ---

Value-based purchasing for ASCs, SNFs, home health, HOPDs, and community mental health centers beginning 2017

---

Reduce bad debt payments (31.1)

Align GME payments with patient care costs (16.3)

Reduce payments for Part B drugs from 106% ASP to 103% (7.4)

Reduce CAH payments from 101% of reasonable costs to 100% (1.7)

Prohibit CAH designation for facilities less than 10 miles from nearest hospital (0.8)

Reduce fraud, waste and abuse (1.8)

Adjust payment updates for certain post-acute care providers (102.1)

Encourage appropriate use of inpatient rehabilitation hospitals (2.2)

Implement bundled post-acute care payments ($9.3)

Extend accountability for hospital-acquired conditions ---

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To view the new CBO estimate, click here.

Republicans Unveil Affordable Care Act Replacement Plan

Senate Finance Chairman Orrin Hatch (R-UT), Senator Richard Burr (R-NC), and House Energy and Commerce Chairman Fred Upton (R-MI) unveiled the Patient Choice, Affordability, Responsibility, and Empowerment (CARE) Act, a legislative plan that repeals the Affordable Care Act (also known as Obamacare) and replaces the President's health care law with alternative reforms, on February 4.

According to a press statement, the plan provides a "legislative roadmap" to repeal the President's health care law and replace it with "common-sense" measures to:

Establish sustainable, patient-focused reforms

Modernize Medicaid to provide better coverage and care to patients

Reduce defensive medicine and rein in frivolous lawsuits

Increase health care price transparency to empower consumers and patients

Reduce distortions in the tax code that drive up health care costs

Empower small businesses and individuals with purchasing power To read the Patient CARE Act Summary, click here. To read a two-page summary, click here. To see a comparison of Patient CARE with the Affordable Care Act, click here.

CMS Approves Coverage for Lung Cancer Screening

On February 5, the Centers for Medicare and Medicaid Services (CMS) announced it has made a final National Coverage Decision (NCD) for lung cancer screening for qualified beneficiaries, including annual screening for lung cancer with low dose computed tomography (LDCT). To be eligible for LDCT screening, beneficiaries must meet all of the following criteria:

Age 55 – 77 years;

Asymptomatic (no signs or symptoms of lung cancer);

Tobacco smoking history of at least 30 pack-years (one pack-year = smoking one pack per day for one year; 1 pack = 20 cigarettes);

Current smoker or one who has quit smoking within the last 15 years; and

Receives a written order for LDCT lung cancer screening from a physician or a qualified non-physician practitioner.

According to the decision summary, coverage will include beneficiary counseling and shared decision-making on the benefits and risks of lung cancer screening. The NCD also requires data collection and includes eligibility criteria for radiologists and radiology imaging centers, consistent with the National Lung Screening Trial, U.S. Preventive Services Task Force recommendations, and other evidence-based guidelines.

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"This is the first time that Medicare has covered lung cancer screening. This is an important new Medicare preventive benefit since lung cancer is the third most common cancer and the leading cause of cancer deaths in the United States," said Dr. Patrick Conway, chief medical officer and deputy administrator for innovation and quality for CMS in a press statement.

To read the CMS decision summary, click here.

CMS Reducing Payments for Physicians Who Failed to Adopt EHRs

On February 10, the Centers for Medicare & Medicaid Services (CMS) announced plans to cut Medicare payments to 256,000 physicians who failed to participate in the Medicare Electronic Health Record (HER) Incentive program in 2015, which will save an estimated $200 million.

Data released by CMS shows 78,000 physicians (31%) will see a payment reduction of at least $2,000, while the remaining doctors will see smaller reductions starting at $250. The 1 percent annual meaningful use penalty, which kicks in when a provider doesn't successfully participate in the EHR program, took effect last month.

According to CMS, it had paid more than $28.13 billion in incentive payments by the end of last year.

In January, CMS also announced its intent to engage in rulemaking to update the Medicare and Medicaid EHR Incentive Programs beginning in 2015. The CMS intends for the changes to help to reduce the reporting burden on providers by addressing provider concerns about software implementation and information exchange readiness.

Specifically, CMS is proposing to:

Realign hospital EHR reporting periods to the calendar year to allow eligible hospitals more time to incorporate 2014 Edition software into their workflows and to better align with other CMS quality programs.

Modify other aspects of the program to match long-term goals, reduce complexity, and lessen providers' reporting burdens.

Shorten the EHR reporting period in 2015 to 90 days to accommodate these changes. To read more about the forthcoming EHR rule, click here.

ICD-10 Implementation

House Energy & Commerce Committee Hearing Examines ICD-10 Transition

On February 11, the House Energy & Commerce Committee hosted "Examining ICD-10 Implementation," a hearing during which lawmakers and a panel of witnesses discussed the preparedness of both providers and payers to transition to an updated ICD-10 system from the existing ICD-9. The transition has been delayed several times by both the Centers for Medicare and Medicaid Services (CMS) and Congress due to stakeholder concerns and is currently set for October 1, 2015.

Providers and payers are preparing to switch operations under the International Classification of Diseases, 9th Revision (ICD-9) code set, which has about 13,000 diagnostic codes, to the greatly expanded ICD, 10th Revision (ICD-10) code set, which has 68,000 diagnostic codes and 87,000 procedural codes. The transition is expected to modernize the coding system used by providers for reimbursement.

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In his opening statement, Subcommittee on Health Chairman Joe Pitts (R-PA) stated, "The United States currently lags behind most of the rest of the world, which already uses the updated ICD-10. ICD-9 is more than thirty years old and does not capture the data needed to track changes in modern medical practice and healthcare delivery."

Witnesses at the hearing included:

Edwin M. Burke, MD, Beyer Medical Group: Burke discussed the unique challenges and lack of resources for treating patients in rural areas, but voiced strong support for the transition, which he said is a better communication tool that will support better patient care.

Rich Averill, Director of Public Policy, 3M Health Information Systems: Averill said ICD-10 transition is needed and that the system is ready. On behalf of the Coalition for ICD-10, he expressed strong opposition to any further delays.

Sue Bowman, Senior Director, Coding Policy and Compliance, American Health Information Management Association: Bowman urged Congress not to further delay the transition. She stated that providers have had adequate time to ready for the transition.

Kristi A. Matus, Chief Financial and Administrative Officer, Athena Health: Matus said that ICD-10 is not a silver bullet, but that in the series of healthcare system improvements that are needed, this is a simple one that should take affect as scheduled.

William Jefferson Terry, MD, Mobile Urology Group: Terry, the only witness who outright opposed implementation in 2015, expressed concern regarding costs and warned that the transition will lead to lost physician productivity.

Carmella Bocchino, Executive Vice President of Clinical Affairs and Strategic Planning, America's Health Insurance Plans: Bocchino said health plans are highly committed to a smooth ICD-10 transition and stressed the value of the ICD-10 system to health plans and providers and the role it will play in supporting quality improvement activities to advance health outcomes for consumers.

Dr. John Hughes, Professor of Medicine, Yale University: Hughes expressed frustration with the ICD-9 coding system, which he said fails to provide the level of detail needed about patient complications. He spoke in favor of ICD-10 transition because of its capacity to track and assess important patient information.

To watch the E&C hearing, click here.

CMS Testing Detects Few Problems with Updated ICD-10 Billing Code System

Between January 26 and February 3, CMS ran its first end-to-end tests of ICD-10, which included 661 providers, billing agencies and equipment supplies, during which nearly 15,000 claims were submitted through the new billing code system. According to CMS, 81 percent of claims were accepted, which the agency lauded as a success.

Following the first round of end-to-end testing, CMS released a fact sheet detailing the reasons the agency plans to proceed with movement to ICD-10 as currently scheduled, including:

ICD-9 is out of date.

ICD-10 codes will provide better support for patient care, and improve management, quality measurement, and analytics.

Physicians and physician specialty groups in the U. S. provided extensive input into the development and timing of implementation of ICD-10-CM to the Centers for Disease Control and Prevention.

Stopping or delaying the ICD-10 transition date would be costly to providers and all health care sectors.

CMS has conducted extensive ICD-10 outreach, education, and testing, including use of social media, webinars, on-site training, educational articles, and national provider calls to help providers learn about ICD-10 and prepare for the transition.

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Despite CMS' enthusiasm following the testing, lawmakers and stakeholders alike remain concerned that the healthcare community is not properly prepared for an October 1 transition, including Congressmen Tom Price (R-Ga.) and Andy Harris (R-Md.), who have both recommended a hybrid system to allow physicians to submit claims under both ICD-9 and ICD-10 during the transition process. CMS plans to hold its next end-to-end testing session April 27 through May 1.

To view the CMS Fact Sheet, "Transitioning to ICD-10," click here.

To download CMS ICD-10 implementation guides and tools, click here.

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and all responsibility for decisions made or actions taken based on the information contained in this newsletter.

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