Objectives. Background. Active Learning Question. Facts Concerning ACO s: Where Pharmacy Fits in this Vital Component of.

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1 The Pharmacist's Expanded Role: Need to Know Updates in Accountable-Care Organizations Disclosures The program chair and presenters for this continuing pharmacy education activity report no relevant financial relationships. Tuesday, December 6, :00 AM 11:00 AM Objectives Facts Concerning ACO s: Where Pharmacy Fits in this Vital Component of Health lthcare Reform Rf Kevin Colgan, MA, FASHP Corporate Director of Pharmacy Provide an overview of the proposed rules for implementing the ACO program Review a number of interesting dynamics associated with the ACO program Identify opportunities for the pharmacy profession in the ACO program Background Affordable Care Act authorizes CMS to a) Establish a Medicare Shared Savings Program b) Allow a new form of provider, the Accountable Care Organization March 31 st, 2011 CMS released a notice of proposed rules for implementing the program Comment period closed June 6, 2011 Program begins January 1, 2012 What are the Triple Aim Goals of the Accountable Care Organization Program? A. Evidence based medicine, prevention & reducing hospitalization B. Focus on better care, better health for populations & lower per capita cost C. Care coordination, medication adherence & reduction in medical errors Page 1 of 5

2 Overarching Principles Don Berwick, Commissioner CMS comments October 5, 2010 OIG, Federal Trade Commission, and the Centers for Medicare & Medicaid Services Workshop on Accountable Care Organizations and Implications Regarding Antitrust, Physician Self Referral, Anti Kickback, and Civil Monetary Penalty Laws Triple Aim goals: 1. to focus on better care; 2. better health for populations; and 3. lower cost per capita 1. Legal entity (corporation, partnership, LLC, foundation) recognized and authorized under applicable state law and composed of certified Medicare providers and suppliers. Eligible providers include: a) Professionals in group practice arrangements b) Networks of individual practices c) Joint venture arrangements between hospitals and professionals d) Hospitals employing professionals 2. Must have a tax ID number that will become the basis for identifying all ACO participants 3. Governing body must have 75% control by providers & include beneficiaries served by the ACO and community stakeholders 4. Management of ACO operations by an executive 5. Clinical management by a senior level medical director 6. Meaningful commitment for clinical integration 7. An ongoing QA & PI program overseen by a physician directed committee 8. A technology infrastructure that enables it to collect data and provide feedback to providers 9. Enough primary care physicians (general practice, family practice, internal medicine, geriatric medicine) sufficient for at least 5000 FFS Medicare beneficiaries Application must include a description of plans to 1. Promote evidence based medicine (EBM) (Rx) 2. Promote beneficiary engagement (Rx) 3. Report tinternally on quality & cost metrics ti (Rx) 4. Coordinate care (Rx) Applications must also exhibit a strong element of patient centeredness (e.g. individualized care plans, transitions of care) (Rx) Rx Note: All of these are opportunities for pharmacists and pharmacy services participating in an ACO What are the opportunities for pharmacists working in an ACO? A. Identifying high risk patients and developing individualized care plans B. Promoting evidence based medicine C. Care coordination D. All of the above Page 2 of 5

3 Must have a beneficiary experience survey (Consumer Assessment of Healthcare Providers CAHPS Survey) systems to identify high risk individuals & develop individualized care plans for targeted patient populations. (Rx) a mechanism for coordinating care (Rx) Patient engagement a means for communicating clinical knowledge and EBM to beneficiaries (Rx) Process for measuring clinical & service performance by physicians across practices Must have a compliance plan A conflict of interest policy Must agree to participate for 3 years Must submit tax ID # and National Provider # for each participating provider Annual assignment period Potential for regulation changes over the 3 years 60 day notice for discontinuing participation Patient Assignment Methodology ACO provides Tax ID # & National Provider # to CMS Patients will only be assigned to primary care physicians (PCP) PCPs must be exclusive to one ACO Shared Savings Program specialists can participate in multiple ACO s ACO participants post signs in their facilities indicating that they participate in a Shared Savings Program Facilities must provide written notification to patients Facilities receive cost and utilization data for beneficiaries that would have been assigned over the previous 3 years Domain Category Measures (Total) Total Points 1. Patient/Caregiver Experience 1 7 (7 measures) Care Coordination 8 23 (16 measures) Patient Safety (2 Measures) 4 4. Preventative Health (9 Measures) At Risk Population/Frail Elderly Diabetes (31 measures) 62 Health Heart Failure CMS-1345-P NCQA, 2011 Coronary Artery Disease Hypertension COPD Frail Elderly TOTAL 130 ACO receives a single score for each domain. Average score of the 5 domains will be the overall score & determine percentage of shared savings the ACO will receive. Measures Pharmacy Can Impact 1. Patient/Caregiver Experience 1 7 (7 measures) Health Promotion and Education---CAHPS Survey 2. Care Coordination 8 23 (16 measures) Medication Reconciliation after discharge from an inpatient facility (within 60 days) Care Transition Measure medication management Disease specific (e.g. diabetes) ambulatory admissions 3. Patient Safety (2 Measures) Health Care Acquired Conditions---Fall and Trauma (medications) 4. Preventative Health (9 Measures) Influenza & pneumococcal vaccination Cholesterol management, Tobacco cessation CMS-1345-P NCQA, 2011 Sixty five total performance measures Measure specific benchmarks will be made known by CMS prior to the performance year Medicare FFS, Medicare Advantage, and ACO performance will serve as the basis for benchmarks All measures are sliding scale except for diabetes and coronary artery disease (all ornothing measures) Page 3 of 5

4 Proposed Sliding Scale ACO Performance Level Quality Points 90 + percentile/percent of benchmark percentile/percent of benchmark percentile/percent of benchmark percentile/percent of benchmark percentile/percent of benchmark percentile/percent of benchmark percentile/percent of benchmark 1.10 <30 + percentile/percent of benchmark No Points Expenditure Baseline Baseline will be developed from beneficiaries that would have been assigned to the ACO in the last 3 years 60% most recent year 30% middle year 10% earliest year Catastrophically large claims will be truncated at the 99 th percentile Hierarchical Condition Categories will be utilized to adjust for variation in beneficiary status Minimum Savings Rate Risk Models ACA mandated that CMS include a MSR to help insure that fluctuations below the benchmark stem from improved performance vs. random chance Varies base on number of assigned beneficiaries Number of Beneficiaries MSR (low end) MSR (high end) 5,000 5, % 3.6% 9,000 9, % 3.0% 10,000 14, % 2.7% 20,000 49, % 2.2% 50,000 59, % 2.0% 60, % 2.0% One Sided Risk Model Shared savings in year 1 Shared risk in year 3 50% of shared savings Up to 2.5% additional for FQHP or RHC MSR = % Shared savings net of 2% threshold Two Sided Risk Model Shared savings in year 1 Shared risk in year 1 60% of shared savings Up to 5.0% additional for FQHP or RHC MSR = 2% Shared savings on first $ basis once MSR exceeded Determine Population & Actual Cost of Care Shared Savings Overview Shared Savings Calculation Determine Scores of all 65 measures Calculate Benchmark(Projected Cost of Care) Measures Calculation Compare to benchmark and assign points INTERVENTION of ACO Calculate new actual cost of care >2% below benchmark Receive savings 50% of amount below the benchmark adjusted for measure scores Create percentages for each domain Apply percentages to calculated share savings Waivers Stark Law & Kickback Statues Deals with the improper steering of patients that is motivated by financial interest Civil Money Penalty Law Prohibits hospitals from payingphysiciansto physicians reduce or limit services to hospitalized patients Waivers Required Distribution of shared savings to providers For activities necessary for and related to the ACO Caveat Payments are not made to limit medically necessary treatments Page 4 of 5

5 Are the federal incentives great enough for forming an ACO? A. Yes B. No C. Unsure 1. IRS indicates that benefits or losses must be proportionate to the provider/participant ACO contribution or ownership. Where is the savings going to come from? Answer: Hospital If the hospital is going to lose all of the revenue & savings is going to the physicians, how will this equitably work? Potential hospital strategy buy physician practices to get a piece of the shared savings or prevent this from occurring altogether 2. The basis of the ACO program is to achieve both financial integration and clinical integration. 79% of physician groups have 9 or fewer physicians. How do you get physicians who don t want to be integrated to participate in an ACO? What s the timeline for true clinical integration? Can it be achieved in 2 years? What s the hub of the model, PCPs or the hospital? Covenant Health Partners spent $2 M to form an ACO and develop participant agreements for 170 physicians from the Covenant Medical Group & 140 independents 3. Size can create an organization that is better able to manage quality and risk. Size is also a powerful advantage for pricing in the private sector. With less competition prices increase. What s the right number of patients for an ACO? Will merger and joint venture activity increase? What effect will this have on the private sector? 4. Medication reconciliation is a clinical process measure for both ACOs and Joint Commission. It also directly affects value base purchasing measures. How will eligible organizations utilize 340B savings to meet financial requirements and performance objectives? Will this create more MTM opportunities for pharmacists? What about increasing medication adherence utilizing the 340B program? Summary ACO s offer the promise of increased quality, improved care of populations, & reduced cost. Pharmacy can play a major role, but most of the focus is on physicians and hospitals Criticisms: (a) () retrospective assignment of patients; ;(b) number of quality metrics; and (c) shared savings rate Will hospitals & physicians participate? US News & World Report & Fidelity Investments Survey 33.2% of hospital executives said it is extremely likely their hospital will become part of an ACO 6.8% believe ACOs can improve quality & efficiency Page 5 of 5