Monitoring Maryland Performance Financial Data. Year to Date thru April 2015
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1 Monitoring Maryland Performance Financial Data Year to Date thru April
2 Gross All Payer Revenue Growth Year to Date (thru April 2015) Compared to Same Period in Prior Year 4.00% 3.00% 2.00% 1.00% 0.00% 1.50% All Revenue 2.01% In State 1.03% All Revenue 1.48% In State FY 2015 CY % -2.00% Out of State Out of State -3.00% -4.00% -3.60% -3.67% -5.00% 2
3 Gross Medicare Fee-for-Service Revenue Growth Year to Date (thru April 2015) Compared to Same Period in Prior Year 6.00% 4.00% 2.00% 0.00% 2.36% All Revenue 3.23% In State 2.98% All Revenue 4.00% In State FY 2015 CY % -4.00% Out of State Out of State -6.00% -8.00% % -6.91% -8.28% 3
4 Per Capita Growth Rates Fiscal Year 2015 and Calendar Year % 4.00% 2.00% 0.00% 1.36% 0.92% 0.54% -0.02% All-Payer In-State Fiscal Year YTD Medicare FFS In-State FY YTD All-Payer In-State Calendar Year YTD Medicare FFS In-State CY YTD Fiscal Calendar -2.00% -4.00% Calendar and Fiscal Year trends to date are below All-Payer Model Guardrail for per capita growth. 4 Population Data from Estimates Prepared by Maryland Department of Planning FFS = Fee-for-Service
5 Per Capita Growth Actual and Underlying Growth CY 2015 Year to Date Compared to Same Period in Base Year (2013) 4.00% 3.00% 2.00% 2.10% 3.18% 1.00% 0.00% -1.00% -2.00% -3.00% Per Capita - All Payer Net Growth Per Capita - Medicare -0.97% -1.99% Growth Before FY 15 UCC/MHIP Adjustments Per capita growth rates distorted by the availability of only two months of CY 2015 data. Underlying growth reflects adjustment for FY 15 revenue decreases that were budget neutral for hospitals. 1.09% revenue decrease offset by reduction in MHIP assessment and hospital bad debts. 5
6 Operating Profits: Fiscal 2015 Year to Date (July-April) Compared to Same Period in FY % 7.00% 6.82% 6.00% 5.97% 5.69% 5.00% 4.00% 3.85% 4.01% 3.00% 2.00% 2.15% 3.13% 1.78% 2.79% 1.00% 0.00% 0.49% All Operating 25th Percentile Median 75th Percentile Rate Regulated Only FY 2014 YTD FY 2015 YTD Year-to-Date FY 2015 hospital operating profits improved compared to the same period in FY
7 Operating Profits by Hospital Fiscal Year to Date (July April) 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% % % % % 7
8 Purpose of Monitoring Maryland Performance Evaluate Maryland s performance against All-Payer Model requirements: All-Payer total hospital per capita revenue growth ceiling for Maryland residents tied to long term state economic growth (GSP) per capita 3.58% annual growth rate Medicare payment savings for Maryland beneficiaries compared to dynamic national trend. Minimum of $330 million in savings over 5years Patient and population centered-measures and targets to promote population health improvement Medicare readmission reductions to national average 30% reduction in preventable conditions under Maryland s Hospital Acquired Condition program (MHAC) over a 5 year period Many other quality improvement targets 8
9 Data Caveats Data revisions are expected. For financial data if residency is unknown, hospitals report this as a Maryland resident. As more data becomes available, there may be shifts from Maryland to out-of-state. Many hospitals are converting revenue systems along with implementation of Electronic Health Records. This may cause some instability in the accuracy of reported data. As a result, HSCRC staff will monitor total revenue as well as the split of in state and out of state revenues. All-payer per capita calculations for Calendar Year 2015 and Fiscal 2015 rely on Maryland Department of Planning projections of population growth of.64% for FY 15 and.56% for CY 15. Medicare per capita calculations use actual trends in Maryland Medicare beneficiary counts as reported monthly to the HSCRC by CMMI. 9
10 Monitoring Maryland Performance Quality Data June 2015 Commission Meeting Update 10
11 Monthly Risk-Adjusted Readmission Rates 18% All-Payer 17% Medicare FFS 16% Linear (All-Payer) 15% 14% 13% 12% 11% 10% Risk Adjusted Readmission Rate All-Payer Medicare Jan.-Feb. 13 YTD 13.65% 14.35% Jan.-Feb. 14 YTD 13.59% 14.79% Jan.-Feb. 15 YTD 12.94% 13.86% Percent Change % -3.42% Note: Based on final data for January December 2014, and preliminary data through March
12 Change in All-Payer Risk-Adjusted Readmission Rates by Hospital 25% 20% Change Calculation compares Jan-Feb. CY 2013 compared to Jan-Feb. CY % 10% 5% 0% -5% -10% -15% Goal of 9.3% Cumulative Reduction 10 Hospitals are on Track for Achieving Goal -20% -25% Note: Based on final data for January December 2014, and preliminary data through March
13 Final Recommendations for Balanced Update June 10, 2015
14 Balanced Update Summary Revenue Per Capita Adjustments Adjustments Revenue Adjustments Linked to Hospital Cost Drivers/Performance Inflation A 2.40% Volume (population growth) B 0.57% Medicaid Expansion - Ongoing Utilization Growth C 0.38% Infrastructure (includes up to 0.25% for competitive grants) D 0.59% Opening of Holy Cross Germantown Hospital E 0.21% Shared Savings (net adjustment) F -0.20% Quality Incentive Payments G 0.15% Planned Revenue Increase for Hospitals H= Sum: A thru G 4.10% 3.51% Reserve for Unforeseen Adjustments I 0.50% Revenue Increase for Hospitals if All Reserves are Allocated J = H + I 4.60% 4.00% Adjustments with Neutral Impact on Hospital Financial Statements MHIP Assessment: Funds removed from rates; hospitals relieved from paying assessment K -0.57% Uncompensated Care: Amount in rates reduced; decline in rates offset by Medicaid payments for previously uninsured/underinsured patients L -0.84% Total Allowed Revenue Growth M = J + K + L 3.19% 2.61% 2
15 Update Maintains Compliance with Waiver Tests All-Payer Test Maximum allowable growth thru FY 2016 is 9.21% Estimated growth through FY 2016 with update is 5.24% Estimated growth thru FY 2016 would be 7.80% if not for declines in uncompensated care and MHIP assessment in FY 2015 and FY Medicare Savings Goal Maryland per beneficiary fee-forservice costs grow 0.5% slower than nation Maximum All-Payer revenue growth for FY 2016 that achieves Medicare savings goal is estimated at 3.45%. Proposed All-Payer revenue growth for FY 2016 is 3.19%, 3
16 Infrastructure Funding - Oversight and Accountability Payers have expressed concern about oversight and accountability Staff Approach Continue annual infrastructure reporting Require all hospitals to submit multi-year plans for improving care coordination, chronic care, and provider alignment by December 1, 2015 Engage consultants to review and evaluate the strategic plans, develop a learning collaborative, and as necessary provide technical assistance to hospitals Require each hospital to identify process and quality measures for inclusion in their annual infrastructure report. Collect data and monitor performance on outcome and process measures that pertain to all hospitals Seek returns on investment for payers and patients in future updates by enhancing the shared savings program. Evaluate the benefits of converting the annual infrastructure report to a biannual report 4
17 Summary of Recommendations Base Update 2.4% for revenues under global budgets 1.6% for revenues subject to waiver but excluded from global budgets 1.9% for psychiatric hospitals and Mt. Washington Pediatric Hospital Infrastructure 0.40% adjustment to GBR budgets 0.30% adjustment for specialty hospitals to reduce potentially avoidable utilization Upto an additional 0.25% available through competitive awards to hospitals implementing or expanding innovative care coordination, physician alignment, and population health strategies. Require all hospitals to submit multi-year plans for improving care coordination, chronic care, and provider alignment by December 1, 2015 Require specialty hospitals to begin submitting admission and discharge data to CRISP by April 1, 2016 to facilitate tracking of readmissions. Medicaid Deficit Assessment Calculate for FY 2016 at same total amount as FY 2015 and apportion it between hospital funded and rate funded in same total amounts as FY
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