Agenda. Medicare Updates. Who s Who. Alyssa Keefe California Hospital Association. Current Fiscal Environment and the President s Budget

Transcription

1 Medicare Updates Alyssa Keefe California Hospital Association Agenda Current Fiscal Environment and the President s Budget BBA of 2018: Key Provisions for Providers and Medicare Advantage Post-Acute Care Prospective Payment System Proposed Rule: Overview, Key Themes and Hospital Considerations BPCI Advanced Updates Other Topics: Site-Neutral Payments, MedPAC Recommendations and What to Expect on Drug Pricing 35 Who s Who US Congress Passes Legislation The US Department of Health and Human Services, including the Centers for Medicare & Medicaid Services, implements legislation through regulation and subregulatory guidance. Established in 1997, MedPAC is an independent advisory board to Congress, made up of 17 members with health policy and clinical expertise. 36 1

2 Azar Confirmed as HHS Secretary The Senate approved Alex Azar for HHS secretary by a vote of on Jan. 24, Background Served as deputy secretary of HHS under George W. Bush Former president of the pharmaceutical company Eli Lilly Has worked closely with Eric Hargan, current HHS deputy secretary Priorities include: Reducing regulatory burden Reining in drug prices Affordable Care Act Obamacare markets 37 Federal Spending Projections Federal Spending Projected for 2027 $6,621 billion Other mandatory Domestic spending discretionary 10% spending 11% Net interest 12% Agriculture 0.20% Other health programs 2% Defense 12% Social security 25% Medicare 18% Medicaid 10% Source: The Congressional Budget Office, June National Health Care and Medicare Spending Medicare is the largest single purchaser of health care in the United States. Other third-party payers 8% Other health insurance programs 4% Medicaid 18% Out of pocket 13% Medicare 22% Private health insurance 35% Source: June 2017 MedPAC Report 39 2

3 CBO Report: Health-Related Factors That Will Drive Up Federal Spending Factor #1: Aging population Number of people over 65 will grow by one-third Spending on Social Security and major health care programs to rise from 10.2 percent of GDP to 12.6 percent 40 CBO Report: Health-Related Factors That Will Drive Up Federal Spending Factor # 2: Growth in health care costs Health spending to rise faster than rest of economy CBO projects nation will spending $16 trillion on Medicare and Medicaid alone Source: Congressional Budget Office 41 Political Theatre Rand Paul voted for tax bill, but opposed the continuing resolution and technically shut down the government for a few hours. Where was the Freedom Caucus? When they wake up 42 3

4 Total Budget Surplus/Deficit FY Surplus 0.0 Deficit Actual Projection 2017 Tax Cut Dollars, in billions ,000.0 * recession announced by National Bureau of Economic Research -1, ,000.0 * * *** * * * **** Source: Bipartisan Policy Center Year 43 Key Provisions in President s Budget Cut payments to Medicare providers Reduce payments for bad debts Reduce payments for post-acute care providers Consolidate GME payments Expand site-neutral payments to all hospital owned outpatient facilities Number of provisions intended to address high and rising drug prices Several major changes to the 340B Drug Pricing Program 44 President s Budget FFY 2019 Address Excessive Payment for PAC Providers by Establishing a Unified Payment System Based on Patients Clinical Needs Rather than Site of Care For FFY 2019 to FFY 2023, the four primary PAC settings, including SNFs, HHAs, IRFs, and LTCHs, will receive a lower annual Medicare payment update. Beginning in FFY 2024, this proposal implements a unified post-acute care payment system that spans these settings, with payments based on episodes of care and patient characteristics rather than the site of service. Rates for the provider types included in this proposal are updated on a fiscal year basis, including those whose payment systems are currently updated on a calendar year basis. The first year of implementation is required to be budget neutral relative to estimated payments that would otherwise have been paid in FFY 2024 absent this change. 45 4

5 Bipartisan Budget Act of 2018 Lifts the debt ceiling through March 2019 Raises non-defense budget caps by $57 billion Extends mandatory 2 percent Medicare sequestration cut through FY 2027 (2 additional years) Extends CHIP additional 4 years through FFY 2027 (Saves $260 million) Reauthorizes community health centers, the National Health Services Corps, and teaching health centers that operate GME programs through FFY 2019 ( billion) 46 Key Provisions of Bipartisan Budget Act of 2018 Eliminates Medicaid disproportionate share hospital reductions for FFY 2018 and FFY 2019 Adds $6 billion in Medicaid DSH reductions in future years (FFY $4 billion; FFY $8 billion per year) Two-year extension of Medicare-dependent Hospital Program (+890 million) Five-year extension of payment adjustment for low-volume hospitals with modifications (+1.8 billion) Extends current outpatient supervision requirements for Critical Access Hospitals and other rural hospitals for calendar year 2017 (in addition to 2018 and 2019) 47 Key Provisions of Bipartisan Budget Act of 2018 Adds hospice to existing post-acute transfer policy beginning Oct. 1, 2018 Hospitals would be paid less upon transfer to hospice for short hospital stays ( billion) Extends the LTCH current blended rate applied to siteneutral cases for two years, and implements a MB reduction of 4.6% for FFY 2018 thru 2026 Sets the SNF rate update at 2.4% for FFY 2019 Five-year extension for home health rural add-on with modifications to payment targeting (+375 million) Sets the home health increase to 1.4 percent in FFY 2020 (-3.5 billion); requires budget neutral reform of home 48 health payment system beginning Jan. 1,

6 Home Health Payment Reform Requires CMS to undergo rulemaking to propose and finalize revised payment system by Jan. 1, 2020 Reduces the unit of a home health episode from 60 to 30 days Requires revision to current case-mix system and elimination of the use of therapy thresholds Home health payments will be revised to ensure reform is budget neutral 49 Therapy and DME Provisions Permanently repeals outpatient therapy caps beginning on Jan. 1, 2018 (+6.47 billion) Continues to require modifier on claims over the current exception threshold indicating medical necessity; lowers the threshold for targeted manual medical review process to $3,000 Offset includes reduction in payment to Part B therapy services furnished all or in part by a physical and occupational therapy assistant Makes permanent coverage of speech generating devices under routinely purchased durable medical equipment (+12 million) 50 Additional Hospital Provisions Includes CHRONIC Care Act Expands telehealth services for home dialysis patients in Medicare Advantage plans and Accountable Care Organizations; removes geographic restrictions to payment for telestroke services Allows CMS flexibility in applying less stringent meaningful use requirements Give CMS increased flexibility in implementing physician Quality Payment Program 51 6

7 Anticipated Regulatory Action in Post-Acute Care Proposed Rule Updates 53 Operating on Two Tracks: Current and Future Legislative IMPACT Act 2014 BBA 2018 Passed 2/9/18 President s Budget -A Marker- End of the year What is next? Regulatory FFY 2019 Rulemaking April October IPPS/LTCH IRF, SNF CY 2019 Rulemaking July August OPPS, HHA 54 7

8 Post-Acute Proposed Rule Updates Payment Setting Rate Update Setting-Specific Payment Adjustments Pay-For-Reporting Programs Other Notables LTCH (proposed rule) IPF (proposed rule) Transition blended PMT rate +0.16% over after FY2019; Proposal [2.7% MB PPT to eliminate the 25% PMT ACA] threshold, and to apply BN Proposal to remove 2 * WI BN adjustment to the LTCH PPS measures in FY2020 and 1 * BN as a result std fed PMT rate. 4.6% measure in FFY of elimination of 25% reduction to IPPS Threshold comparable amount for SN until FFY 2026 Proposal to remove 8 factors in FFY Considering Soliciting proposing measures re comments about +1.4% administration of a the differences in [2.8% MB PPT ACA] standardized depression the IPF labor mix, * WI BN instrument, and assesses patient mix and in change in pt reported function provision of drugs based on the standardized and laboratory depression instrument between services. admission and discharge. 55 Payment Setting SNF (proposed rule) IRF (proposed rule) Post-Acute Proposed Rule Updates (cont d) Rate Update +2.4% [2.7% MB- 0.8 PPT ACA] * -0.49% (1% cap) * WI BN +1.15% [2.9% MB PPT ACA] *1.0 WI BN * case mix BN Setting-Specific Payment Adjustments Significant proposed case mix adjustment change from RUGS-IV to PDPM model. Pay-For-Reporting Programs VBP beg FFY 2019 providing incentive payments to SNFs w/ > levels of performance and penalties of up to 2% w/ <performance on readmissions; CMS proposed that low-volume SNFs be assigned a break-even performance score in SNF VBP; For SNF QRP, proposal to increase data from 1 to 2 years for MSPB calculation and D/C to community. Proposal to remove 1 measure in FFY 2020 and 1 in FFY Proposal to publically display 4 assessment-based measures. Other Notables Proposed interrupted stay policy. Proposed removal of the FIM instrument and associated function modifier from the IRF-PAI. In order to reduce burden, proposals that the post-admission MD evaluation may count as 1 of the 3 face-to-face mtgs, that rehab MDs may lead the team mtgs remotely w/o any add l documentation, and remove the requirement to have admission order documentation. Soliciting comments re coverage requirements. 56 Proposed IRF Coverage Changes: Rehabilitation Physician Role Proposed change to physician supervision requirement Allows post-admission physician evaluation to count as one of the three face-to-face physician visits required per week CMS seeks comments on additional changes to physician supervision requirement and use of non-physician practitioners: Could rehabilitation physicians remotely access both medical and functional needs of an IRF patient? Would remote access affect the quality or intensity of the physician visit? What type of clinician should be present in the room with the patient during a remote physician evaluation? Should CMS expand the use of non-physician practitioners, such as physician assistants and nurse practitioners, in IRFs? 57 8

9 Proposed IRF Coverage Changes: Rehabilitation Physician Role (cont d) Proposed change to the interdisciplinary team meeting requirement Allows rehabilitation physicians to participate in weekly meetings of the interdisciplinary team via video and telephone conference Regulatory Relief 58 Proposed Changes: Co-located Hospitals Proposed reduction of Separateness & Control requirements Satellites in an IPPS-excluded hospital would also be exempted from S&C requirements Proposed new co-location arrangement Excluded hospitals could host a co-located IPF or IRF unit or satellite, which would be exempt from S&C requirements 59 Key Themes PAC PPS: Delayed any additions to the patient assessment items, but quality measurement development continues Removal of quality measures that were duplicative across all PPSs Significant changes proposed for SNF and IRF PPS for FFY 2020 Likely to coincide in future years with additional patient assessment items Likely creating operational challenges, but positions agency to more alignment on unified PAC PPS Lack of transparency from agency about release of data 60 9

10 Post-Acute Care PPS: Timeline Considerations FFY 2019 (Oct 1, 2018) Complete SPADE Beta Test Summer 2018 April 2019 (FFY 2020 Proposed Rules) FFY 2020 (Oct 1,2019) Likely new SPADE items, potential new PPS for IRF and SNF April 2020 (FFY 2021 Proposed Rules) CMS GOAL: Unified Post- Acute Care PPS FFY FFY (Oct 1, (October 2020) Likely 2023) SPADE items and/or new PPS for IRF and SNF 61 Walk & Chew Gum at the Same Time Quality measure refinement Add items to assessment tools Continued refinement and rebasing Tinker with update factors for cost savings Unified PPS Congress and CMS continue to ask providers to lower costs, increase efficiencies, and transform care delivery. Do more with less. 62 Hospital Considerations Future PAC PPS changes will have significant upstream implications in future years if implemented Changes in admission criteria by PAC providers Disruption in target pricing for Advance Payment Models in out years Significant CoP changes in process for SNFs Engage and prepare, understand what is happening outside the hospital that will impact hospital operations 63 10

11 BPCI Advanced Quick Update 64 BPCI Advanced Model Overview Voluntary bundled payment model Single payment and risk track with a 90-day episode period 29 Inpatient Clinical Episodes 3 Outpatient Clinical Episodes Qualifies as Advanced Alternative Payment Model (Advanced APM) Payment is tied to performance on quality measures Preliminary Target Prices provided prospectively 65 3 BPCI Advanced Timeline 66 11

12 Who Can Participate? Convener Participant: Entities that are either Medicareenrolled or not Medicare-enrolled providers or suppliers Brings together downstream Episode Initiators (EIs) Facilitates coordination Bears and apportions financial risks Non-Convener Participant: Physician Group Practices & Acute Care Hospitals Is the Episode Initiator (EIs) Bears financial risk only for itself Does not bear risk on behalf of downstream EIs 67 Key Differences: BPCI vs. BPCI Advanced BPCI BPCI Advanced 48 Inpatient (IP) Clinical Episodes 29 IP and 3 OP Clinical Episodes Not an Advanced APM since lacking CEHRT requirement and quality not tied to Model is an Advanced APM payment No quality measures required for payment purposes Excludes cost of care associated with services according to 13 unique exclusion listings of unrelated care Model 3 includes PAC providers triggering episodes in the post-discharge period Risk corridor of 20% of spending above the upper limit of the selected risk track Target Prices provided at reconciliation Quality measures are reportable and performance on these measures will be tied to payment Limited exclusions; Excludes the Part A & B costs associated with ACH readmissions qualifying based on a limited set of MS-DRGs No equivalent for Model 3; design is similar to Model 2 with PGPs and ACHs as EIs; PAC Providers, and other Medicare-enrolled, as well as non-medicare-enrolled entities can participate as Convener Participants One risk track Risk is capped at +/-20% Preliminary Target Prices provided prospectively, before the start of each Model Year 68 Resources Comparison Table of Bundled Payment Models Frequently Asked Questions CHA s Alternative Payment Models Resource Page 69 12

13 Quick Hits: Site-Neutral in OPPS and MedPAC Recommendations 70 BBA of 2015 Amended by 21 st Century Cures, Signed December 3, 2016 CMS has specified February 13, 2017 as the 60 days after enactment 71 Slide 18 Section 603: Off-Campus HOPD PBD Site-Neutral Policy 2017 Final Rule Payment: Allows non-excepted HOPDs to bill Medicare and be paid directly for services at 50% of OPPS level 2018 Final Rule Payment: Reduces payment for non-excepted HOPDs to bill Medicare and be paid directly for services at 40% of the OPPS level Extraordinary Circumstance Relocation Exception Guidance for an Off- Campus Provider-Based Department CMS Region IX has granted seismic relocation requests for provider-based hospital outpatient departments in California. CHA is unaware of any hospital that has requested or been granted an exception for any other circumstance as described in the final rule. If you require an exception and relocation, please contact CHA

14 MedPAC Commission s Recommendations on Unified PAC PPS Unified PAC PPS could establish accurate and unbiased payments Recommendation in 2016: PPS design features PAC PPS could be implemented sooner than contemplated in IMPACT Act Recommendation in 2017: Begin implementation in 2021 Aggregate level of Medicare payments for PAC is high Recommendation in 2017: Lower payments by 5% Increase the equity of PAC payments before PAC PPS is implemented Recommendation in 2018: Blend the current setting-specific relative weights and PAC PPS relative weights to correct biases in current payment systems 73 Growing Emergency Department Use Medicare outpatient ED use grew faster than nationwide ED use and Medicare physician visits 2 highest-paying levels of ED visits (levels 4 and 5) growing as a share of all Medicare ED visits Medicare outpatient ED payments increased 72% per beneficiary ( ) 74 Medicare Payment for ED and Urgent Care Services (2018) *PFS payment rates for services delivered in hospital EDs reflect level 4 physician ED services; payment rates for services delivered in urgent care centers and physician offices reflect level 4 evaluation and management codes for new patients Source: MedPAC Public Meeting - March 1,

15 Stand-Alone EDs Emerging trend: stand-alone EDs Approximately stand-alone EDs operating in several states Approximately 2/3 are hospital-owned off-campus EDs (OCEDs) that can bill Medicare Most opened since 2010 Stand-alone Emergency Departments are not allowed under current CA state licensing regulations Previous legislation to amend state law has failed 76 MedPAC Chairman s Draft Recommendations: EDs Urban draft recommendation: Align payments to urban OCEDs with the cost of care Congress should reduce Type A emergency department payment rates by 30% for off-campus, stand-alone EDs that are within 6 miles of OCED Rural draft recommendation: Preserve access to rural ED services Congress should allow rural-stand alone EDs to bill standard OPPS facility fees and provide such EDs with annual payments to assist with fixed costs (standby costs, emergency services, physician recruitment) 77 Quick Hits: Federal Audit Updates, Regulations on Drug Pricing and Regulatory Relief 78 15

16 Noridian Targeted Probe and Educate (TPE) Bulletin issued September 2017: Targeted Probe and Educate Pilot (Rolling out nationwide) Noridian Targeted Probe and Educate (TPE) Pilot TPE Q&A s Applies to all medical review The TPE review process includes three rounds of a prepayment probe review with education. If there are continued high denials after the first three rounds, Noridian will refer the provider and results to CMS. CMS Central Office will determine additional action, which may include extrapolation, referral to the Zone Program Integrity Contractor, referral to Recovery Auditor Contractor, etc. 79 TPE Continued Noridian is targeting CERT errors Example: Hip and Knee replacements IRF Medical Necessity, Outpatient Claims Providers should always comply with provider education provided and make it an organizational priority Everyone should participate in education! Avoid referrals to other contractors, there is no process articulated for coming back to regular TPE processes! 80 Other Medicare Contractors Recovery Audits Contractors (RAC) Supplemental Medical Review Specialty Contractor (SMRC) Zone Program Integrity Contractor (ZPIC) Quality Improvement Organization (QIO) Identifies improper Medicaid payments made on healthcare claims California Region 4 HMS Federal Conducts medical reviews as directed by CMS Strategic Health Solutions Investigates instances of suspected fraud, waste and abuse Reviews appeals and complaints about health care for Medicare recipients; short stay reviews Livanta Program Overview Program Overview Program Overview Program Overview 81 16

17 What Comes Next in Drug Pricing? American Patients First Trump Administration Blueprint to Lower Drug Prices Four major goals Address the increase in list prices of drugs Maximize the potential of government programs and private payers to leverage negotiating power Tackle high out-of-pocket costs Ensure the practices of foreign markets are not disadvantaging American innovation Actions and proposals include: Requiring safety net hospitals paid under Medicare Part B to use their 340B drug discounts to provide care to more low-income and vulnerable patients 82 CMS Initiative CMS Goals Reduce unnecessary burden Increase efficiencies Improve the beneficiary experience Patients Over Paperwork Site CMS Noted Achievements Meaningful Measures Exempting docs from QPP TPE initiative Documentation review simplification Send CHA your ideas to reduce regulation, administrative paperwork and the annoying policies that divert resources from patient care!

18 85 CHA Resources CHA IMPACT Act Resource Page 86 CHA Resources CHA Regulatory Tracker 87 18

19 Questions? Thank you Alyssa Keefe Vice President, Federal Regulatory Affairs California Hospital Association 89 19