Contracting with an ACO Webinar. September 17, :00 pm 1:00 pm. Thank you for joining us. The webinar will begin shortly.

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1 Contracting with an ACO Webinar September 17, :00 pm 1:00 pm Thank you for joining us. The webinar will begin shortly. If you experience technical difficulties at any time, please contact or General Information 1.0 AMA PRA Category 1 Credit Online evaluation and CME certificate PowerPoint slides available for download You will also receive this information in a reminder , following the webinar Questions during the webinar may be submitted to pprc@mms.org Questions will be answered at the end of the presentation For help with technical difficulties, pprc@mms.org 1

2 Faculty Introductions Presenter Presenter J. Mark Waxman, JD Partner, Foley & Lardner LLP Alexis Bortniker, JD Associate, Foley & Lardner LLP Faculty and Planner Disclosures The following CME faculty and program planners have indicated their financial interests and/or relationships with commercial manufacturer(s) (and/or those of their spouse/partner) below. The Department of Continuing Education and Certification (DCEC) of the Massachusetts Medical Society has reviewed the appropriate documentation provided by the individuals who are in a position to control the content of this educational activity. The DCEC has determined that any potential relevant conflict of interest has been resolved. For more information, contact the DCEC at continuingeducation@mms.org. Presenter: J. Mark Waxman, JD N/A Alexis Bortniker, JD N/A Planners: Talia Goldsmith - N/A Kerry Ann Hayon- N/A Elaine Kirshenbaum N/A Linda Masiello - N/A MMS Sponsored Program Committee: Aram V. Chobanian, MD- N/A Larry Culpepper, MD, MPH Consultant: AstraZeneca LP, Forest Labs, Jansen, Lundbeck, Pfizer, Takeda; Consultant & Speaker s Bureau: Merck Eli Freiman Roy A. Johnson, MD N/A Robin Schoenthaler, MD - N/A Deeb N. Salem, MD - N/A Henry Tulgan, MD - N/A James Yeh, MD - N/A 2

3 Contracting with an ACO J. Mark Waxman Alexis F. Bortniker 5 Outline What is an ACO? ACO Agreements with Payers Considerations for Joining an ACO Questions to Ask in Joining an ACO ACO Exclusivity Contractual Terms to Focus On Payment Models and Compensation Terms Defining the Population Other Contractual Terms Stark Law, Anti-Kickback Statutes, and Anti-Trust Risks Clinical Integration 6 3

4 ACO Basics: What is an ACO? An accountable care organization (ACO) is a provider-led organization whose mission is to manage the full continuum of care and be accountable for the overall costs and quality of care for a defined population. The provider composition of an ACO can vary and may include: Integrated delivery systems (including hospitals and health systems) Physician group practices/physician organizations Physician hospital organizations (PHOs) Independent practice associations (IPAs) Virtual physician organizations 7 ACO Basics: What s an ACO? *Graphic credit: MMS Guide to Accountable Care Organizations: What Physicians Need to Know, C. Collins and J. Mark Waxman, Mass. Med. Soc., September

5 ACO Basics: What is an ACO? ACOs can take any legal form permitted by applicable state law, but they are characterized by a care delivery and payment system that ties provider reimbursement to quality metrics and reductions in the total cost of care for a designated population of patients. While state and federal laws govern aspects of Medicare or state-certified ACOs, there are no laws or regulations that define what agreements with private entities may call the resulting delivery system an ACO. The following existing entities may qualify to become ACOs, including integrated delivery systems: Hospitals, physicians, and other providers under common control Providers affiliated through clinical and/or financial integration or a contracting network Large PCP practices or multispecialty physician practices PHOs that are clinically and/or financially integrated Medical foundations Staff model health maintenance organizations (HMOs) Contracted groups of suppliers Joint ventures of two or more of the above-listed entities 9 ACO Contracting Arrangements ACO Agreements with Medicare Pioneer ACO Medicare Shared Savings Program Private Payer Agreements Vary by contract Risk based payment or global payments BCBSMA AQC and Global Payment Arrangements Massachusetts Ch

6 Considerations for Joining an ACO Do you belong to an IPA/PHO that meets your needs? What are the local provider dynamics in the community? What are the local payer dynamics? What is the geographic coverage of your patient base? Are you ready for value-based reimbursement? What sort of integration do you envision? What do your relationships with other providers look like? What stage of your career are you in? Do you have a niche practice? 11 Benefits and Challenges of Joining an ACO *Graphic credit: MMS Guide to Accountable Care Organizations: What Physicians Need to Know, C. Collins and J. Mark Waxman, Mass. Med. Soc., September

7 Choosing the Right ACO Know your role and fit within the ACO Understand your data Know what value you bring to the ACO Be willing to make clinical and operational transformation a priority Understand the Physician and Values Understand the necessary infrastructure required for a successful relationship 13 Exclusive Participation in an ACO Under federal regulations regarding Medicare ACOs, every ACO participant with a tax identification number (TIN) that bills for primary care services must be exclusive to a single Medicare ACO. The exclusivity provision applies to each TIN. Aside from the regulatory exclusivity requirements, certain agreements with ACO may have separate exclusivity requirements, which should largely be avoided. Agreements should clearly specify whether participation shall apply to Medicare/Medicaid plans only, or in other Payer arrangements as well. 14 7

8 Contractual Terms: Payments Models Bundled or Capitated Payments Shared Savings Payments Risk Arrangements Fee for Service Payments Payment for Administrative Services 15 Contractual Terms: Compensation How is the ACO being compensated? The ACO may have flexibility in compensating providers, no matter how it is compensated. How will the provider be compensated for services provided? To the extent that physicians will be receiving capitated rates on a per patient basis, the process for assigning patients should be clearly detailed. If a physician is receiving payments for capitated services, or bundled payments intended to cover a diagnosis or procedure, what services are included and what needs to be carved out should also be specified. 16 8

9 Contractual Terms: Compensation Performance-based payments Measures for payment should be clearly established What payments will be made and when Earned but unpaid bonuses to be paid on termination Bonus Payments Timing of Payments: Cash Flow Issues 17 Contractual Terms: Defining the Population How will members be allocated to the physician or group? Will the group have any control over the care provided? What happens if a member is incorrectly allocated? What happens if a member is disenrolled in the middle of the month? 18 9

10 Contractual Terms: Claims Submission and Payment As with any payer contract, claim submission and payment terms should be clearly outlined. Reasonable filing deadlines Opportunity to appeal a denied claim Payment within days Limited audit rights Appeal process available to physicians 19 Contractual Terms Term and Termination Record Ownership Rights Audit Rights Indemnification Restrictive Covenants 20 10

11 Stark Law Risks Stark law prohibits physicians from having any financial relationship with an entity that furnishes Medicare- covered designated health services and from referring patients to that entity. It prohibits the entity from billing the Medicare program for any services performed as a result of such referrals. Implicated by compensation and ownership arrangements Strict Liability Statute Must meet an exception Risk Sharing Personal Services Agreements FMV Arrangements Employment Agreements 21 Anti-Kickback Statute Risks AKS prohibits someone from knowingly and willfully giving (or offering to give) remuneration to another person if such payment is intended to induce referrals for the furnishing of health services or to induce the purchase, order, lease, or recommendation of items covered by Medicare. Intent-based statute Applicable Safe Harbors 22 11

12 Anti-Trust Risk The Federal Trade Commission and the Antitrust Division of the Department of Justice recognize that in certain markets, ACOs could reduce competition and hurt consumers by raising prices and/or offering lowerquality care. Clinical Integration as a solution to joint contracting 23 Clinical Integration Required for anti-trust protection and ACO success Essential Elements *Graphic credit: MMS Guide to Accountable Care Organizations: What Physicians Need to Know, C. Collins and J. Mark Waxman, Mass. Med. Soc., September

13 Clinical Integration: Care Delivery Transformation Disease Management Care Coordination Patient Engagement 25 Clinical Integration: Performance Management and Analytics Need to be able to gather and monitor data regarding organizational and provider performance Need to manage and analyze data for efficient and effective operation of ACO Requires appropriate IT infrastructure 26 13

14 Approaching an ACO 1) Know your readiness level 2) Determine which ACOs to approach 3) Formulate Questions 4) Initiate Contact *Graphic credit: MMS Guide to Accountable Care Organizations: What Physicians Need to Know, C. Collins and J. Mark Waxman, Mass. Med. Soc., September Questions? Presenter Presenter J. Mark Waxman, JD Partner, Foley & Lardner LLP Alexis Bortniker, JD Associate, Foley & Lardner LLP Submit your questions by ing 14

15 Evaluation, CME Credit & Resource Information To complete your evaluation, please visit: After completing the evaluation, you will be directed to the MMS CME Certificate portal. Enter the CME Activity Code: CONT91713 Enter your FIRST and LAST name. To access today s presentation and other resources, visit Questions regarding CME certificates and/or presentations, contact MMS Continuing Education at , x7306 or mmscmecertification@mms.org 15