Update on the Medicare and Medicaid Meaningful Use Programs
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1 Update on the Medicare and Medicaid Meaningful Use Programs ACC Quick Hits December 2, 2014 Rick Rifenbark Foley & Lardner LLP Attorney Advertising Prior results do not guarantee a similar outcome Models used are not clients but may be representative of clients 777 East Wisconsin Avenue, Milwaukee, WI
2 1 Medicare/Medicaid EHR MU Programs The American Recovery and Reinvestment Act of 2009 allocates billions of dollars in incentive payments to encourage the adoption of EHR systems Hospitals and eligible professionals (EPs) qualify for incentive payments if they make meaningful use of certified EHR technology (CEHRT) Medicare payment penalty applies if EHR meaningful use is not achieved by certain dates Hospitals may participate in the Medicare and Medicaid EHR programs; EPs must choose one
3 2 Participation and Payments to Date Through September 30, 2014: EP Participation Medicare: 483,167 Medicaid: 194,094 Hospital Participation Medicare: 7,701 Medicaid: 8,176 Total Payments Medicare Program: $16.3 billion Medicaid Program: $8.6 billion
4 3 EHR Adoption Rates Eligible Professionals 2001 = 18% have some form of EHR system 2013 = 78% have some form of EHR system June 2014 = 75% of EPs have received EHR incentive payments Hospitals 2011 = 72% have a certified EHR system 2013 = 94% have a certified EHR system June 2014 = 92% of hospitals have received EHR incentive payments Federally Qualified Health Centers 2012 = 90% have some form of EHR system (ONC Report to Congress, October 2014)
5 4 MU Program: Key Dates Medicare incentive payments are winding down Last year for an EP to begin participation = CY 2014 Last year for hospitals to begin participation = FFY 2015 Medicare payment adjustments are starting October 1, 2014 for Hospitals January 1, 2015 for EPs Hardship waiver requests Medicaid incentive program lasts through 2021 Last year to begin participation is 2016
6 5 Recent Developments/Key Issues CEHRT Flexibility Regulations (September 4, 2014) CY 2014 (EPs) and FFY 2014 (Hospitals) Applies to EPs and Hospitals who did not upgrade to 2014 CEHRT due to delays in 2014 CEHRT availability Examples of acceptable/unacceptable reasons for delay CEHRT flexibility regulations permit those EPs and Hospitals to attest to MU Stage CEHRT required for 2015 Physician Fee Schedule (October 31, 2014) Extended hardship waiver deadline to Nov. 30, 2014
7 6 Recent Developments/Key Issues Extension of Stark and Anti-Kickback Statute EHR Donation Regulations: Regulations extended to December 31, 2021 Exclusion of laboratory companies Modifications to deemed interoperability E-Prescribing capability no longer required Prohibition on data and referral lock-in No additional guidance on covered technology
8 7 Recent Developments/Key Issues Assignment of EHR Incentive Payments by EPs: EPs are permitted to reassign their incentive payments to their employer or to an entity with which they have a contractual arrangement allowing the employer or entity to bill and receive payment for the EP's covered professional services. 42 C.F.R (f)(1) We are taking this opportunity to remind the public that if the EP wishes to reassign his or her incentive payment to the employer or entity with which the EP has a contractual arrangement, the parties should review their existing contract(s) to determine whether the contract(s) currently provides for reassignment of the incentive payments or if the contact(s) needs to be revised. 75 Fed. Reg , (July 28, 2010)
9 8 Recent Developments/Key Issues Meaningful Use Audits: We will review Medicare incentive payments to eligible health care professionals and hospitals for adopting EHRs and the Centers for Medicare & Medicaid Services (CMS) safeguards to prevent erroneous incentive payments. We will review Medicare incentive payment data from 2011 to identify payments to providers that should not have received incentive payments (e.g., those not meeting selected meaningful use criteria). We will also assess CMS s plans to oversee incentive payments for the duration of the program and actions taken to remedy erroneous incentive payments. - OIG Fiscal Year 2015 Work Plan
10 9 Meaningful Use Audits: CMS Process Various audit processes Pre-payment edit checks Pre-payment audits Post-payment audits Pre and post payment audits Conducted by Figliozzi and Company Initial letter Follow up requests Potential on site review CMS reportedly intends to conduct pre- and postpayment audits on 5-10% of attestations
11 10 Meaningful Use Audits: Potential Penalties
12 11 Meaningful Use Audits: Potential Penalties Recoupment Where there is fraud Imprisonment Fines Civil liability Loss of license Exclusion Medicare payment penalties associated with failure to meet MU objectives Examples
13 12 Meaningful Use Audits: Appeals Medicare appeal process set forth on CMS website Process consists of the submission of an appeal request form and relevant materials Pay attention to MU appeal deadlines, which vary based on whether the submission is by an EP or Hospital Information to be submitted depends on reason for MU appeal Certain issues are not appealable Denial of hardship waiver request
14 13 Meaningful Use Audits: Recommendations Work with the person who will be attesting for your organization (e.g., practice manager, IT personnel, finance dept. personnel) Maintain documentation relevant to MU attestation Source documents Documentation for non-percentage-based objectives Other relevant documents (e.g., ONC EHR certification) Pay attention to document retention periods 6 years for MU objectives and clinical quality measures Payment calculation data (e.g., cost reports) should follow current documentation retention processes States may require longer periods for Medicaid Conduct self audits Consider development of MU policies
15 The Changing Provider Landscape: An Update on the Adoption of Electronic Health Records Meaningful Use Program and Value Based Payment Models December 2, 2014
16 Disclaimer Any views or opinions presented in this presenta1on are solely those of the author and do not necessarily represent those of Pa1entPoint, LLC, its subsidiaries, or affiliates (collec1vely Pa1entPoint ). Pa1entPoint accepts no liability for the content of this presenta1on or for the consequences of any ac1ons taken on the basis of the informa1on provided whether in oral, wriden, or electronic format. 15
17 ONC is focused on interoperability, big data, and privacy/ security amongst other initiatives The increased adoption of Health IT via ARRA and broader market forces has highlighted the need for in-house counsel to prepare for the legal challenges relating to the accumulation of large electronic data sets (big data), the exchange of data between non-affiliated parties (interoperability), and the protection of those data from unauthorized use or disclosure (privacy and security) The Office of the National Coordinator (ONC), a primary regulator for the MU program, has assigned its Health IT Policy Committee to make recommendations on a policy framework for the development and adoption of a nationwide health information infrastructure, including standards for the exchange of patient medical information. In 2014, ONC reorganized its IT Policy Committees to focus on the following: Advanced Health Models and Meaningful Use Consumer Health IT Implementation, Usability and Safety Health IT Strategy and Innovation Interoperability and Health Information Exchange Governance Subgroup JASON Task Force Privacy and Security 16
18 Interoperability demand will significantly increase in the near and long term Why does interoperability matter? A meaningful exchange of information, electronic or otherwise, can take place between two parties only when the data are expressed in a mutually comprehensible format and include the information that both parties deem important. While these requirements are obvious, they have been major obstacles to the practical exchange of health care information and the resulting benefits (e.g. increased patient safety, reducing waste) What is driving market demand? MU2 interoperability requirements Increase in value based contracting and ACOs (public and private) Rising consumer expectations of accessibility of medical records Practical implications Significant increase, perhaps via mandate, to share certain information or make it available in a standard format requires complex, yet flexible, commercial arrangements between multiple participants (i.e. providers, payers, numerous technology vendors, consultants) Numerous technology vendors are setting up vendor supported APIs and app stores creating ecosystems centered around their respective technologies The ONC and FTC are promoting healthy competition in Health IT by examining high switching costs, data lock-in, misguided standard setting, and other factors 17
19 Complexity of the proposed public API (via JASON) suggests the continued involvement of multiple players and technologies 18
20 The proliferation of big data will highlight known areas of concern What is Big Data?... Big data refers to things one can do at a large scale that cannot be done at a smaller one, to extract insights or create new forms of value, in ways that change markets, organizations, the relationship between citizens and governments, and more. (Viktor Mayer-Schoenberger and Kenneth Cukier, Big Data: A Revolution that will Transform How we Live, Work, and Think, Houghton Mifflin Harcourt Publishing, 2013) What is driving the trend? Big data introduces new opportunities to advance medicine and science, improve health care, and support better public health White House Open Government Partnership ( intends to use big data to support greater openness and accountability while ensuring privacy protection for big data analyses in health. Practical Implications Managing multiple records retention requirements in large consolidated data sets may require metadata or tagging projects to enable automation Tracking/granting consumer preferences/authorizations tied to specific fields or records will enable appropriate uses across temporal restrictions Notice and consent mechanisms may be outdated De-identification may be considered insufficient to protect privacy in big data analytics 19
21 Primary data pools The big-data revolution in US health care: Accelerating value and innovation 20
22 Privacy and security issues remain an important regulatory priority Greater enforcement by healthcare regulators focused on privacy/security obligations OIG Work Plan: (FY 2015). We will perform audits of various covered entities receiving EHR incentive payments from CMS and their business associates, such as EHR cloud service providers, to determine whether they adequately protect electronic health information created or maintained by certified EHR technology, the work plan indicates.. Furthermore, business associates that transmit, process, and store EHRs for Medicare and Medicaid providers are playing a larger role in the protection of electronic health information, OIG continues. Therefore, audits of cloud service providers and other downstream service providers are necessary to ensure compliance with regulatory requirements and contractual agreements. OCR Pilot Privacy, Security, and Breach Notification Audit Program ( Increased focus by cybercriminals Healthcare entities are increasingly targeted by sophisticated criminal enterprises as the value of a medical record could reach 10x that of financial information Practical Considerations Maintain an ongoing and pro-active risk identification and remediation program Monitor downstream vendors aggressively Integrate with your data quality and product management departments early and often 21
23 Update On Value Based Purchasing Models ACC Quick Hits December 2, 2014 C. Frederick Geilfuss Foley & Lardner LLP Attorney Advertising Prior results do not guarantee a similar outcome Models used are not clients but may be representative of clients 777 East Wisconsin Avenue, Milwaukee, WI
24 Value Based Purchasing Affordable Care Act: Implementing the Triple Aim ACA Programs Focused on Value - Medicare Shared Savings Program Pioneer ACO Program Bundled Payment Program Medical Homes Value-Based Purchasing Hospital Readmission/Hospital Acquired Conditions Medicare Advantage Star Ratings Medical Loss Ratio Limits for Health Plans 23
25 ACO PARTICIPATION Initially, 32 Pioneer ACOs; now MSSP ACOs Serving more than 5.6 million Medicare beneficiaries Number of commercial ACOs estimated at 250 and growing Over 18.2 million people in ACOs 24
26 ACO Results Pioneer ACOs 2nd Year Results for 23 ACOs Total Savings $96 million Shared Saving Payments $68 million Savings to Medicare $41 million 11 Pioneer ACOs earned savings 3 Pioneer ACOs generated losses Per Capita Medicare growth slowed to 1.4% Quality improvements continue Quality score increased 19.8% Improvement on 28 of 33 measures Patient caregiver experiences improved 25
27 ACO Results MSSP ACOs 1st Year Results (204 ACOs) 58 ACOs earned savings of $315 million (spending $705 million below benchmark) 60 ACOs reduced costs but did not earn share of savings Total net savings to Medicare Program of $383 million One Track 2 ACO required to repay $4 million Quality improvement on 30 of 33 quality measures Commercial ACOs No true measure of results Variations in structure 26
28 Analyzing Results From whose perspective? CMS celebrates results Some critics less optimistic WSJ Editorial ObamaCare s Failing Cost Control Oct. 20, 2014, p. A The law s accountable care experiment is a bust so far. American Hospital Association - - April 17, 2014 Letter Providers - - Unclear What are goals? What are investments? Participation is continuing Commercial payers Medicare beneficiaries 27
29 How Do ACOs Work? 28
30 How Do ACOs Work? MSSP design is an influential example MSSP framework Medicare fee-for-service beneficiaries Free choice of providers by beneficiaries No limited network; No steerage Beneficiary attribution No beneficiary sign-up No lock-in Retroactive attribution based on plurality of primary care services All reimbursable services are included as costs (not just those by ACO providers) Generally, ACO s only payment from federal government is shared savings, if any Significant infrastructure costs 29
31 How Do ACOs work? (cont.) MSSP framework (cont.) Initial 3-year term: No downside risk On renewal, must take downside risk Cost benchmark set based on historic Medicare spending, with medical cost trend Paid up to 50% of cost savings (reduced Medicare revenues) after minimum savings Percentage paid depends on meeting quality standards Fraud and abuse waivers 30
32 ACOs: What Is Happening In Market? Still a buzz ACO Investment Model (Oct. 2014) Agreements with post-acute providers Agreements with ancillary providers -- example, ambulance companies ACOs reshaping to avoid taking downside risk Value of waivers 31
33 Is the Medicare MSSP ACO Sustainable? Cost savings mean less revenue Downside risk on renewal Reset cost benchmarks will be harder to beat All Medicare providers included, not just those participating No incentives for beneficiaries to utilize ACO participants Better and more timely data needed Paying for infrastructure But, providers have commitment Expectation of MSSP revisions in early
34 Commercial ACOs Used more by big payers as issues understood Use of shared savings against a benchmark Narrow/defined networks Steerage to network providers Quality indicators Moving to providers taking risk ACO waivers do not apply Antitrust issues With self-funded plans, insurance issues 33
35 LEGAL CHALLENGES Fraud and abuse laws MSSP waivers are broad Commercial ACOs more challenges Antitrust Joint contracting is the key issue Safe harbors for MSSP ACOs 34
36 CONCLUSION Value-based models are popular MSSP/Pioneer programs will need revisions/refinements Providers moving toward more risk More commercial ACO structures 35
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