Making CJR Work for You. A Roadmap for Successful Implementation of Medicare Bundles
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- Rosalyn Boyd
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1 December 10, 2015 Making CJR Work for You A Roadmap for Successful Implementation of Medicare Bundles
2 Sheldon Hamburger (248)
3 Key Takeaways You re the payer Executive leadership is essential Opportunity is in post-acute Doing the right thing is most profitable
4 Background HHS goal of 30 percent traditional FFS Medicare payment through alternative payment models by the end of percent by the end of 2018 HHS Press Office
5 Sample Hospital Total Program 100% $113,000,000 Anchor Stay 44% $50,000,000 Post-Acute 56% $63,000,000 Other 2% LTAC 4% IRF 9% SNF 18% Anchor Stay 44% Ambulatory 4% $5,000,000 HHA 5% $6,000,000 Readmissions 13% $15,000,000 IRF 9% $10,000,000 LTAC 4% $5,000,000 Other 2% $2,000,000 SNF 18% $20,000,000 Readmissions Ambulatory 13% 4% HHA 5%
6 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
7 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
8 The Program Comprehensive Care for Joint Replacement MANDATORY Bundled payment for lower extremity joints MS-DRG 469 & 470 w/ & w/o CC/MCC Medicare FFS beneficiaries DRG + 90 days post-discharge All Part A and Part B (some exceptions) Hospitals only
9 The Program Only hospitals in one of 67 MSAs MSA: Metropolitan Statistical Area Census Bureau designation CMS used only for selecting hospitals Target pricing is region-based MSA
10 The Program Included services Physicians' services Inpatient hospitalization (including readmissions) Inpatient Psychiatric Facility (IPF) Long-term care hospital (LTCH) Inpatient rehabilitation facility (IRF) Skilled nursing facility (SNF) Home health agency (HHA) Hospital outpatient services Independent outpatient therapy Clinical laboratory Durable medical equipment (DME) Part B drugs Hospice Excluded services Acute clinical conditions not arising from existing episoderelated chronic clinical conditions or complications of the LEJR surgery Chronic conditions that are generally not affected by the LEJR procedure or post-surgical care
11 The Program Timing Begins April 1, year program 2016 is 9 months (Apr 1 Dec 31) Phase-in of risk, targets, requirements
12 The Program Payment FFS as usual for all parties Retrospective reconciliation (annual) Total episode spend target price =? <0 means you get $ >0 means you owe $
13 The Program Total episode spend over ~90 days CMS totals all claims for: DRG + SNF + HHA + DME + Part B Target price CMS determines/revises 2x/yr Based on history (you and your region)
14 The Program CMS Spend (Claims Paid) Target Price Result
15 The Program CMS Spend (Claims Paid) Target Price Result $18,000 $20,000 CMS pays you $2,000
16 The Program CMS Spend (Claims Paid) Target Price Result $18,000 $20,000 CMS pays you $2,000 $21,000 $20,000 You pay CMS $1,000 Shared Savings Model
17 The Program Target price Variable over the program lifetime Phase-in: 33% -100% on regional spend Based on 3 year historical data Stratified to accommodate fractures Discounted for CMS cut CJR Target Baseline Pricing Jan 12-Dec 14 Jan 12-Dec 14 Jan 14-Dec 16 Jan 14-Dec 16 Jan 16-Dec 18
18 The Program
19 The Program DRG Mountain 469 $ 47, $ 23,734 West North DRG Central 469 $ 46, $ 23,800 East North DRG Central 469 $ 50, $ 25,480 Middle DRG Atlantic 469 $ 52, $ 27,406 New DRG England 469 $ 47, $ 24,858 DRG Pacific 469 $ 48, $ 23,425 West South DRG Central 469 $ 55, $ 27,464 East North DRG Central 469 $ 50, $ 25,480 South DRG Atlantic 469 $ 51, $ 25,989
20 The Program In addition Based on BPCI Model 2 Stop-loss & stop-gain phased in CMS takes up 3% off the top Could be as little as 1.5% based on.. Your achievement of quality metrics
21 The Program CJR Reconciliation Payments Upside cap 20% of target 20% of target 20% of target 20% of target 20% of target
22 The Program CJR Reconciliation Payments Upside cap 20% of target 20% of target 20% of target 20% of target 20% of target Downside * None 10% of target 20% of target 20% of target 20% of target
23 The Program CJR Reconciliation Payments Upside cap 20% of target 20% of target 20% of target 20% of target 20% of target Downside * None 10% of target 20% of target 20% of target 20% of target * Exceptions None 3% of target 5% of target 5% of target 5% of target Spend > 2sd from the mean are excluded
24 The Program Quality issues Quality results = $ Composite Quality Score determines discount Higher discount = less $ for you
25 The Program Quality Category CJR Composite Quality Scoring Maximum Points Score Allocation Notes RSCR for THA/TKA (NQF #1550) 10 50% Based on hospital's decile performance nationally
26 The Program Quality Category CJR Composite Quality Scoring Maximum Points Score Allocation Notes RSCR for THA/TKA (NQF #1550) HCAHPS (NQF #0166) 10 50% 8 40% Based on hospital's decile performance nationally Based on hospital's decile performance nationally
27 The Program Quality Category CJR Composite Quality Scoring Maximum Points Score Allocation Notes RSCR for THA/TKA (NQF #1550) HCAHPS (NQF #0166) THA/TKA outcomes 10 50% 8 40% 2 10% Based on hospital's decile performance nationally Based on hospital's decile performance nationally Voluntary yr 1-3, may be mandatory yr 4-5
28 The Program CJR Composite Scoring Performance Percentile (national) THA/TKA Complications HCAHPS Survey >= 90th th th th th th th <30th
29 The Program Composite Quality Score < 4.0 Quality Category Below Acceptable Eligible for Reconciliation Payment CJR Discount Structure Eligible for Quality Incentive Payment Discount for Reconciliation Payment Discount for Repayment Year 1 Discount for Repayment Years 2-3 Discount for Repayment Years 4-5 No No 3.0% N/A 2.0% 3.0%
30 The Program Composite Quality Score Quality Category Eligible for Reconciliation Payment CJR Discount Structure Eligible for Quality Incentive Payment Discount for Reconciliation Payment Discount for Repayment Year 1 Discount for Repayment Years 2-3 Discount for Repayment Years 4-5 < 4.0 Below Acceptable No No 3.0% N/A 2.0% 3.0% Acceptable Yes No 3.0% N/A 2.0% 3.0%
31 The Program Composite Quality Score Quality Category Eligible for Reconciliation Payment CJR Discount Structure Eligible for Quality Incentive Payment Discount for Reconciliation Payment Discount for Repayment Year 1 Discount for Repayment Years 2-3 Discount for Repayment Years 4-5 < 4.0 Below Acceptable No No 3.0% N/A 2.0% 3.0% Acceptable Yes No 3.0% N/A 2.0% 3.0% Good Yes Yes 2.0% N/A 1.0% 2.0%
32 The Program Composite Quality Score Quality Category Eligible for Reconciliation Payment CJR Discount Structure Eligible for Quality Incentive Payment Discount for Reconciliation Payment Discount for Repayment Year 1 Discount for Repayment Years 2-3 Discount for Repayment Years 4-5 < 4.0 Below Acceptable No No 3.0% N/A 2.0% 3.0% Acceptable Yes No 3.0% N/A 2.0% 3.0% Good Yes Yes 2.0% N/A 1.0% 2.0% >13.2 Excellent Yes Yes 1.5% N/A 0.5% 1.5%
33 The Program Data CMS will provide several data sets Aggregated data on target pricing (automatically) Claim level data on target pricing (on request) Monthly (?) updates on performance Process for data request not yet defined Target pricing data available prior to launch Privacy issues and patient opt-out
34 The Program Gainsharing Allowable with CJR collaborators Providers/suppliers supporting the program Care redesign efforts during the episode Portion of reconciliation amount or Internal cost savings Contract in place prior to patient care Upside and downside risk (some limits)
35 The Program Waivers SNF 3-day rule starts in year 2 Home health visits Telehealth CMS & OIG joint statement Protects gainsharing arrangements
36 The Program Other Beneficiary incentives allowable >$25 must be documented Technology must be <= $1,000 Items >$50 returned to the hospital after episode Post-acute care options Must provide a complete list to patient Preferred provider network is not prevented
37 The Program Compared to BPCI Regional target pricing Hospitals only Quality measures required for gainsharing CMS discount as low as 1.5%
38 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
39 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
40 What It Means Game changer Responsibilities extend beyond discharge New business/care models Synergies with other value-based models Competitors as collaborators
41 What It Means Mandatory No opt-out for you Need to respond now (not tomorrow)! Risky to interpret year 1 as ramp-up April 1, 2016 is sooner than you think
42 What It Means Extended care 90 days post-discharge Care settings are unfamiliar Creating partnerships will be a challenge Following patients is hard
43 What It Means Financial implications Risk management Measuring exposure Skill sets; e.g., analytics Managing new resources and requirements
44 What It Means Care reengineering Pathways, protocols, alignment Working with post-acute partners Ongoing education challenge Care navigator role
45 What It Means Data/analytics Challenge to existing capabilities Likely require outside products/services Merging with internal data warehouse/systems Deployment of data to users (real time)
46 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
47 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
48 What To Do Right Now Top to-do s Planning Gainsharing arrangements Post-acute network
49 What To Do Right Now Planning Hire/contract/appoint/conscript a leader Acquire industry knowledge/lessons learned Establish a working team Get an analytics partner
50 What To Do Right Now Tactical planning
51 What To Do Right Now Tactical planning Organizational alignment
52 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation
53 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation Care process reengineering
54 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation Care process reengineering Contracting
55 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation Care process reengineering Contracting Post-acute care network
56 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation Care process reengineering Contracting Post-acute care network Performance metrics
57 What To Do Right Now Tactical planning Organizational alignment Bundle evaluation Care process reengineering Contracting Post-acute care network Performance metrics
58 What To Do Right Now Gainsharing arrangements Identify partners (surgeons) Begin discussions Establish terms Draft/execute contracts
59 What To Do Right Now Gainsharing contract considerations Oversight, gainsharing, quality issues Payments must be quality based Negotiate quality measures and thresholds Providers may be in other programs Co management, professional service arrangements, medical directorships
60 What To Do Right Now Gainsharing contract considerations What happens to unallocated $ Payments off the top Who owns the data?
61 What To Do Right Now Post-acute network Identify key partners (SNF, HHA) Review historical usage patterns Establish formal selection/integration process Determine selection criteria/metrics
62 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
63 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
64 Understanding The Data Key drivers for your strategy Availability of data - Internal and payer systems - Experiential It s all about post-acute spend Ability to drive positive change Volume creates leverage
65 Understanding The Data
66 Understanding The Data Pays for ~3% here ~3% Savings here
67 Understanding The Data
68 Understanding The Data
69 Understanding The Data
70 Understanding The Data
71 Understanding The Data
72 Understanding The Data
73 Understanding The Data SNF # Episodes Total Average Readmissions Readmission Payment Payment Rate SNF 1 80 $785,461 $9, % SNF 2 25 $301,225 $12, % SNF 3 25 $187,522 $7, % SNF 4 23 $354,001 $15, % SNF 5 17 $196,222 $11, % SNF 6 12 $164,526 $13, % SNF 7 11 $255,124 $23, % SNF 8 11 $91,230 $8, % SNF 9 10 $115,235 $11, % SNF 10 8 $152,134 $19, % SNF 11 7 $48,256 $6, % SNF 12 6 $44,120 $7, % SNF 13 4 $56,125 $14, % SNF 14 3 $14,597 $4, % SNF 15 4 $39,256 $9, % SNF 16 3 $13,021 $4, %
74 Understanding The Data HHA # Episodes Total Payment Average Payment Readmissions Readmission Rate Our own HHA 132 $422,123 $3, % Competitor 22 $93,213 $4, % Competitor 15 $87,456 $5, % Competitor 12 $48,213 $4, % Competitor 10 $35,124 $3, % Competitor 9 $15,784 $1, % Competitor 8 $23,549 $2, % Competitor 7 $22,056 $3, % Competitor 7 $18,452 $2, % Competitor 7 $18,547 $2, % Competitor 6 $18,213 $3, % Competitor 6 $24,153 $4, % Competitor 5 $17,918 $3, % Competitor 4 $72,123 $18, %
75 Understanding The Data Sample Readiness KPIs / Data Sets Average annual CJR volume by year, location, DRG (past 5 years)
76 Understanding The Data Sample Readiness KPIs / Data Sets Average Annual CJR volume by year, location, DRG (past 5 years) Average internal cost data / DRG
77 Understanding The Data Sample Readiness KPIs / Data Sets Average annual CJR volume by year, location, DRG (past 5 years) Average internal cost data / DRG List of orthopedic practices, ownership, relationship, quality ratings
78 Understanding The Data Sample Readiness KPIs / Data Sets Average annual CJR volume by year, location, DRG (past 5 years) Average internal cost data / DRG List of orthopedic practices, ownership, relationship, quality ratings List of SNFs, HHAs, others, discharges patterns, quality ratings, readmission rates, LOS
79 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
80 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
81 Post-Acute Networks Bundles are about post-acute spend This is the source of your profit Efforts should be focused here Strategy is in optimizing that spend - Direct post-acute care utilization - Readmissions
82 Post-Acute Networks Total Program 100% $113,000,000 Anchor Stay 44% $50,000,000 Post-Acute 56% $63,000,000 Other 2% LTAC 4% IRF 9% SNF 18% Anchor Stay 44% Ambulatory 4% $5,000,000 HHA 5% $6,000,000 Readmissions 13% $15,000,000 IRF 9% $10,000,000 LTAC 4% $5,000,000 Other 2% $2,000,000 SNF 18% $20,000,000 Readmissions Ambulatory 13% 4% HHA 5%
83 Post-Acute Networks Key post-acute partners SNF, HHA, IRF Your own ED (and other EDs) Community resources Partner s effect is bundle specific Optimizing utilization is the goal
84 Post-Acute Care Network SNF # Episodes Total Average Readmissions Readmission Payment Payment Rate SNF 1 80 $785,461 $9, % SNF 2 25 $301,225 $12, % SNF 3 25 $187,522 $7, % SNF 4 23 $354,001 $15, % SNF 5 17 $196,222 $11, % SNF 6 12 $164,526 $13, % SNF 7 11 $255,124 $23, % SNF 8 11 $91,230 $8, % SNF 9 10 $115,235 $11, % SNF 10 8 $152,134 $19, % SNF 11 7 $48,256 $6, % SNF 12 6 $44,120 $7, % SNF 13 4 $56,125 $14, % SNF 14 3 $14,597 $4, % SNF 15 4 $39,256 $9, % SNF 16 3 $13,021 $4, %
85 Post-Acute Networks SNF Referrals SNF 1 SNF 5 SNF 9 SNF 13 SNF 17 SNF 21 SNF 25 SNF 29 SNF 33 SNF 37 SNF 41 SNF 45 SNF 49 SNF 53 SNF 57 SNF 61 SNF 65 SNF 69 SNF 73
86 Post-Acute Care Network HHA # Episodes Total Payment Average Payment Readmissions Readmission Rate Our own HHA 132 $422,123 $3, % Competitor 22 $93,213 $4, % Competitor 15 $87,456 $5, % Competitor 12 $48,213 $4, % Competitor 10 $35,124 $3, % Competitor 9 $15,784 $1, % Competitor 8 $23,549 $2, % Competitor 7 $22,056 $3, % Competitor 7 $18,452 $2, % Competitor 7 $18,547 $2, % Competitor 6 $18,213 $3, % Competitor 6 $24,153 $4, % Competitor 5 $17,918 $3, % Competitor 4 $72,123 $18, %
87 Post-Acute Networks Why a post-acute network? Ensures best quality/performance Creates standardized/compliant care Develops competition toward improvement How to create the network? Formal selection process Internal input to performance metrics Open to everyone
88 Post-Acute Networks Challenges Timeframe Internal pushback External pushback Sample performance criteria Reduction in LOS Reduction in readmissions Adherence to our protocols/pathways
89 Post-Acute Networks Special considerations Understanding of PAC drivers Limitations and capabilities Hospital support of PAC needs Integration; e.g., your staff in their facility
90 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
91 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
92 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
93 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
94 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
95 Agenda The CJR program What it means to you What to do right now Understanding the data Post-acute networks
96 Questions? Sheldon Hamburger (248)
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