Moving to Accountable Care through the ACA & MACRA Jim Whitfill, MD President Lumetis, LLC Clinical Associate Professor, Departments of Internal Medicine and Biomedical Informatics University of Arizona College of Medicine-Phoenix
Introduction Macro trends have come together to drive legislation that incorporates cost and quality as variables in reimbursement from CMS MACRA legislation brings relief from the SGR fee schedule cuts but brings performance standards to fee for service Medicare payments Advanced payment models interact with MACRA and can offer an alternative for very specific groups of physicians 2
Macro Factors Influencing US Healthcare System 3
Federal Costs Rising 4
Employer and Employee Costs Rising Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits 5
Healthcare Costs in the Elderly Drive US Costs http://blogs-images.forbes.com/danmunro/files/2014/04/hccostsbyage.png Hagist; Kotlikoff. Working Paper 11833 National Bureau of Economic Research Dec 2005 Fischbeck, Paul. "US-Europe Comparisons of Health Risk for Specific Gender-Age Groups. Carnegie Mellon University: September 2009 6
Cms.gov 1/2015 7
CMS Pushing for Cost and Quality Transparency to Get More Care for Same or Fewer Dollars Managed Medicare/MA Alternate Payment Methods (ACO/BPI) Choice Quality Cost Fee for Service/MIPS 8
Where Did MACRA Come From? (US physicians missed this cut by hours) 9
Incremental Approach Towards Quality with Medicare in the 2000s Tax Relief and Health Care Act of 2006 began what is Physician Quality Reporting System (PQRS) Health Information Technology for Economic and Clinical Health Act (HITECH) of 2009 added Meaningful Use adoption of EHR technology Affordable Care Act (ACA) of 2010 created the Value Based Modifier to add differential payments to physicians based on cost and quality 10
2014: The Boiling Point Federal macro costs out of control Overlapping quality programs and threats of annual fee schedule cuts from SGR top target for AMA Strong desire at CMS to align cost and quality with payment 11 11
Medicare Access & CHIP Reauthorization Act of 2015 (passed April 2015) Repeals the SGR Formula Ties Part B Fee Schedule to cuts or increases based on cost & quality Combines three quality reporting systems into one (with 3 parts ) Incentivizes providers into Advanced Alternative Payment Models (AAPMs) 12
M a y 3, 2 0 1 6 MIPS brings threats of fee schedule cuts and incentives based on MIPS scores All providers are required to participate in MIPS in 2017, proposed rule First reporting period 1/1/2017 to 12/31/2017 Payments adjusted in 2019 based on performance in the 2017 period MIPS is budget neutral so any incentives are paid for via cuts to other providers However there is a budget exempt $500 million dollars for exceptional performance in the first 5 years The Advisory Board Health Care Cheat Sheet Series MACRA: Educational Briefing for IR Professionals, April 2016
CMS Estimates of MACRA Impacts Solo Providers: 87% will suffer falling reimbursement rates 2-9 Providers: 70% will experience falling reimbursement rates 25-99 Providers: 55% will experience a rise in reimbursement >100 Providers: 81% projected to see a rise in reimbursement https://www.federalregister.gov/articles/2016/05/09/2016-10032/medicare-program-merit-based-incentive-paymentsystem-mips-and-alternative-payment-model-apm 14
Proposed Timeline 15
MIPS Score: First Year Clinical Practice Improvement Activities Category 15% of score in year 1 Cost Category* 10% of score in year 1; replaces the Value Modifier Program, also known as Resource Use) *For clinicians who do not meet these category requirements, CMS proposes reweighting the score to 0 and recalculating the other categories. https://www.cms.gov/medicare/quality-initiatives-patient-assessment-instruments/value-based-programs/macra-mips-and-apms/mips-scoring-methodologyslide-deck.pdf Quality Category 50% of score in year 1; replaces the Physician Quality Reporting System Advancing Care Information Category* 25% of score in year 1; formerly Meaningful Use 16
Quality Metric Consolidation: MIPS: Quality MIPS Quality Score (80-90 points) Clinicians choose either 6 measures to report: 1 must be a crosscutting measure; 1 must be an outcome or other high quality measure OR may choose to report a specialty measure set MIPS will also calculate either 2 or 3 populations measures based on claims data, no additional reporting is needed. For individuals & groups of 2-9, MIPS calculates 2 population measures. For groups of 10+, MIPS calculates 3 population measures. PQRS 6-9 Measures out of 284 Claims, and registries used for submission Value Based Modifier (3) Hospital admissions for ACSC 30 day all cause readmissions
Advancing Care Information (ACI) (max 100 points) BASE SCORE: 50 points, 6 measures PERFORMANCE SCORE: up to 80 points Max combined score = 100 Clinicians must use certified EHR technology No longer all-or-nothing reporting If the measures are not applicable for a clinician, CMS may reweight the whole category to zero and adjust the weighting of the remaining categories 18
Clinical Practice Improvement Activities Weighted: some are 20 points, others are 10 Clinicians who are not patient-facing (for example, pathologists or radiologists) will only need to report on one activity. Clinicians will receive credit toward scores for participating in APMs (50%) and Patient- Centered Medical Homes (100%) Max Total Points: 60 There are 90+ activities in the following categories: 19
Resource Use/Cost MIPS calculates cost category scores based on Medicare claims, no additional reporting is required Uses 40+ episode-specific measures to account for differences among specialties Must see a sufficient # of patients, generally a min 20-patient sample is required If the clinician does not have enough patient volume, CMS may reweight the whole category to zero and adjust the weighting of the remaining categories Excluded for APM participants Reported in 2017 but does not count towards MIPS in year 1 20
MIPS Participant Exemptions Are newly enrolled in Medicare; Have < $30,000 in Medicare charges AND have < 100 Medicare patients; Are significantly participating in an AAPM. 21
Medicare Shared Savings Program Track 1-Upside Risk only (2012 -) Sharing Rate: % of total savings to the MSSP Retrospective attribution Max sharing rate 50% Payment limit 10% MSR: 2-4% Track 2- Upside and Downside Risk (2012-) Retrospective attribution Max sharing rate 60% Payment limit 15% Lower MSR and now with choice in MSR/MLR levels Loss limit 5% 7.5% 10% Track 3 (2015- ) Upside and Downside Risk Prospective Attribution Max sharing rate 75% Payment limit 20% More waivers Loss limit 15% MSR: Minimum Savings Rate. Threshold to receive $$ MLR: Maximum Loss Rate: Threshold to pay $$ Payment Limit: Maximum limit on savings $$ Loss Limit: Maximum limit of $$ paid for losses 22
ACO Arizona Medicare ACO s Start Date Ownership/Structure Service Area PCP's Attributed members/ #Beneficiaries Banner Health Network* 1/1/2012 Arizona Care Network 1/1/2012 Yavapai Accountable Care 1/1/2012 Commonwealth PCACO 1/1/2012 Arizona Connected Care 4/1/2012 JC Lincoln ACO 7/1/2012 Premier 1/1/2014 Scottsdale Health Partners 1/1/2014 ASPA-Connected Care 1/1/2015 North Central AZ Accountable Care 1/1/2015 Abacus ACO 1/1/2016 Optum ACO** 1/1/2016 BH, BPHO, BMG, AIP Maricopa and Pinal Counties Dignity Abrazo Arizona Independent Physicians Yavapai and Coconino Counties Independent PCP's Arizona, New Mexico Community Providers, TMC Southern Arizona JC Lincoln Health Phoenix Metro Independent Physicians Lakewood CA SHC & SPO Maricopa Counties Independent Physicians Arizona, New Mexico YRMC, NAH, Affiliates Yavapai & Coconino Counties Independent Physicians Southern Arizona Optum Medical Network Maricopa County 200 63,000 331 29,000 NR 5,000 100 16,000 195 5,600 140 14,800 NR 5,000 100 18,000 30 5887 54 10,800 NR NR 203 37,000
CMS Fast Facts About ACOs (Jan 2017) PROGRAM SIZE 480 Shared Savings Program ACOs 9 million assigned beneficiaries in 50 states plus Washington, DC and Puerto Rico PAYMENT CHARACTERISTICS Track 1 (one-sided) 438 ACOs (91%) Track 2 (two-sided) 6 ACOs (1%) Track 3 (two-sided/prospective) 36 ACOs (8%) Advance Payment (CMMI Initiative) 45 ACOs ( 9%) https://www.cms.gov/medicare/medicare-fee-for-service-payment/sharedsavingsprogram/downloads/all-starts-mssp-aco.pdf 24
MSSP Results to Date 2012 2013 2014 2015 Earned Shared Savings 29 55 92 120 Achieved Savings below MSR 25 60 89 83 Increased Spending 60 88 223 230 Increased Spending and Owed Money 0 1 0 0 Total # MSSP 114 204 404 433 25
New Payment Mechanism in Next Gen Model Goals of payment mechanisms: Offer ACOs the opportunity for stable and predictable cash flow Facilitate investment in infrastructure and care coordination. Alternative payment flows do not affect beneficiary out-of-pocket expenses or net CMS expenditures. 26
Interactions between MIPS and Track 1 MSSP No MSSP providers need to report additional quality measures outside MSSP reporting MSSP TINs will still need to report ACI measures MSSP providers will receive 100% credit in the CPIA category in 2017 MSSP not scored on cost under MIPS 27
APM Scoring Standard 28
APM Scoring Standard 29
2015 & Earlier MACRA Timeline 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 & Beyond TRACK 1 TRACK 2 PQRS MU Value Modifier Physician Payment Updates +0.5% +0.5% +0.5% +0.5% Qualifying participants in an APM are exempt from MIPS (+/-) 4% 0 0 0 0 0 0 MIPS Payment Adjustment (+/-) 5% (+/-) 7% (+/-) 9% (+/-) 9% (+/-) 9% APM Bonus +5% annual bonus (+/-) 9% +0.25% +0.75%
Qualifying Advanced APMs for 2017 Advanced Alternative Payment Models vs Alternative Payment Models : only the former will count for incentives and MIPS exemption Comprehensive ESRD Care (CEC) - Two-Sided Risk Comprehensive Primary Care Plus (CPC+) Next Generation ACO Model Shared Savings Program - Track 2 Shared Savings Program - Track 3 Oncology Care Model (OCM) - Two-Sided Risk Comprehensive Care for Joint Replacement (CJR) Payment Model (Track 1- CEHRT) Vermont Medicare ACO Initiative (as part of the Vermont All- Payer ACO Model) 31
AAPM Incentive Payments 32
Advanced APM Requirements Can Be Financial or Patient Volume Based In 2019-2020: requirements are for Medicare payments and patients only. In 2021: non-medicare payers and patients may count towards participation requirements 33
Qualifying APM % of Claims Volume* Needed Through APM Medicare Only Option All-Payer Option 80% 80% 70% 70% 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 2019 2020 2021 2022 2023 2024+ 0% 2019 2020 2021 2022 2023 2024+ APM % Medicare APM% Total APM% * Alternatively, patient count thresholds would also be measured
CMS Expects Most Providers to Be Subject To MIPS 35
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Macro Economics in a Trump Administration Have Not Changed CBO 2015 Infographic 38
Unravelling the ACA: A Three Front War Executive Orders - Broad guidance to reduce regulation and increase discretion to blunt effects from the ACA - Could eliminate mandate (IRS already not flagging returns) - Could expand Medicaid waivers - Opens door for intrastate insurance markets - Could undo some ACA taxes Reconciliation - Simple majority in Senate - Limited to spending and tax changes - Taxes and subsidies could be repealed - Byrd rule prevents use if no impact on budget New Legislation - Need 60 votes in the Senate to proceed 39
Obamacare Penalties (tax) for not having insurance Subsidies to Insurers for premium and co-pay support Expand Medicaid with 90-100% Federal funding Mandatory coverage of many conditions No lifetime limits and no preexisting conditions Trumpcare Premiums increase without continuous coverage HSAs and tax credits for individuals Reform Medicaid to be a defined contribution program Relax coverage requirements to allow more access * Use high risk pools to insure the most costly patients * https://www.nytimes.com/2017/02/16/us/politics/affordable-care-act-congress.html?_r=0
Employer Provided Insurance, Medicare, & Medicaid Likely to Follow Patterns from Employer Provided Retirement Plans 41
High Risk Pools: State level 1976-2013 Estimated need for HRP in 2011: 4 Million First pools offered by MN and CT in 1976 35 states had risk pools in 2012 pre ACA and covered 212,000 people Medically eligible HIPAA eligible (covers those who had but lost group benefits) HCTC eligible Medicare Eligible Pools vary but always have Elevated premiums at 150-200% of market Pre-exisiting condition exclusions for 6-12 months Lifetime limits of 1-2$ million (some as low as $3,000 per year) Deductibles generally $1000-$2500 All pools lost money 2011 $1.2 Billion/$5500 per enrollee Paid by state via assessments on non-group private insurance and other state sources J Gen Intern Med. 2011 Jan; 26(1): 91 94 http://kff.org/health-reform/issue-brief/high-risk-pools-for-uninsurable-individuals/ 42
Selling Health Insurance Across State Lines RI, WY, GA, KT, ME each have laws to allow selling insurance across state lines AZ legislature passed a bill in 2012 but it was vetoed No state has had success in attracting out of state insurers National bills have not been endorsed by insurance lobbying groups when entered in Congress Large employers already self insured and not subject to state regulation Barrier to entry: regulatory vs network development http://www.rwjf.org/content/dam/farm/reports/issue_briefs/2012/rwjf401409 44
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