2013 Health Care Regulatory Update. January 8, 2013

Size: px

Start display at page:

Download "2013 Health Care Regulatory Update. January 8, 2013"

Lee McLaughlin
6 years ago
Views:

1 2013 Health Care Regulatory Update January 8, 2013

2 Quality-Based Payment Reform, ACOs and Clinical Integration Bruce Johnson and Tom Donohoe

3 Overview Quality-based payment reform programs Major programs Timing of implementation and changes Penalties Obligations ACOs and clinical integration Medicare Accountable Care Organization (ACO) update Trends with Medicare and commercial programs 3

4 Payment Reform Programs Overview Affordable Care Act and predecessor payment reform legislation have instituted numerous payment reform programs Some programs penalize; others incentivize through additional payments Objective: Incentivize providers to improve quality (to reduce costs) Impact: Non-compliance generally results in reduction of payment 4

5 Payment Reform Programs Significant payment reform programs currently in effect that directly affect payments Hospital Inpatient and Outpatient Quality Reporting Programs (IQR and OQR) Hospital Acquired Conditions Program (HAC) Hospital Readmissions Program Value Based Purchasing Program (VBP) Physician Value Based Payment Modifier (VBPM) 5

6 Hospital IQR and OQR Background Hospital IQR Initially established as the Reporting Hospital Quality Data Annual Payment Updated under the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) Penalty MMA instituted 0.4% reduction on the IPPS market basket update, which was increased to 2% under the Deficit Reduction Act of 2005 Current penalty is 2% reduction in IPPS market basket update and 2% reduction in annual update to OPPS Obligation IQR: 57 measures in FY 2013, 55 measures in FY 2014, 59 measures in FY 2015 and 60 measures in FY OQR: 26 measures (some suspended/inactive); 5 proposed for future years Public Reporting Hospital Compare 6

7 Hospital Acquired Conditions Program Background Deficit Reduction Act of 2005 required HHS to gather information on HACs; IPPS Final Rule for FY 2009 instituted payment penalty Currently 11 HAC categories Applies only to IPPS hospitals Penalty For discharges after October 1, 2008, no higher DRG payment if a HAC occurs during hospitalization and was not present upon admission Starting in FY 2015, hospitals in the top quartile relative to national average of HACs will receive 1% reduction in payment in all DRGs Developments For FY 2013, CMS added two new categories (1) Iatrogenic pneumothorax with venous catheterization, and (2) surgical site infection after a cardiac implantable electronic device procedures 7

8 Hospital Readmissions Program Background Established under the ACA; began on October 1, 2012 Penalty CMS will reduce base operating DRG payments by an adjustment factor that accounts for excess readmissions up to 1% in FY 2013, 2% in FY 2014 and 3% in FY 2015 and beyond. Measurements for FY 2013 Acute myocardial infarction, heart failure and pneumonia 30 day measures Methodology Comparison of excess readmission ratio for each of three measures Excess readmission ratio calculated using data for discharges from 7/1/2008 to June 30, 2011 Hospital must have a minimum of 25 discharges for each of three measures for the program to apply 8

9 Value Based Purchasing Program Background Established by ACA; effective for FY 2013 through FY 2017 for now Eliminate or reduce adverse events, facilitate evidence-based care to improve outcomes and re-engineer processes to improve patient care experience Subsection (d) hospitals (excluding hospitals with IQR reductions) Penalty/incentive DRG payments reduced by 1% with an opportunity to earn back this amount and more based on performance; grows to 2% by FY 2017 Methodology FY 2013 domains Clinical Process of Care Domain (70%) and Patient Experience of Care Domain (30%) Baseline period compared to performance period TPS scores will be used to determine effect on DRG payments Total Perform Scores (TPS) based on improvement from baseline, threshold (median of all hospitals) and benchmark data (top 10% of all hospitals during baseline) data, and weighted for domain 9

10 2012 Developments and 2013 Upcoming Dates - There will be an additional Outcomes domain for FY CMS added two additional measures to this domain for FY 2015 a PSI 90 (AHRQ Patient Safety Indicator composite measure) and the Central Line-Associated Blood Stream Infection measure - CMS added an Efficiency domain for FY 2015 that includes a Medicare Spending per Beneficiary measure - CMS created an appeals process - Performance periods for FY 2015 in effect in CY

11 Value Based Purchasing Modifier Program Background ACA mandate that CMS begin applying a value modifier under the Medicare Physician Fee Schedule (MPFS) by 2015 Eligibility groups of 100 or more eligible professionals Penalty up to 3.5% in FY 2015 Measurement First performance period is in CY 2013 Domains Quality of care including potentially preventable hospital admissions for heart failure, COPD and diabetes Cost includes evaluation of physician total per capita costs for beneficiaries with COPD, heart failure, coronary artery disease and diabetes Quality Tiering model to compare both domains Quality/Cost Low Cost Av. Cost High Cost High quality +2.0x^ +1.0x^ +0.0% Average quality +1.0x^ +0.0% -0.5% Low quality +0.0% -0.5% -1.0% 11

12 Payment Reform and Accountable Care Accountable Care Organizations - population health management Medicare initiatives Medicare Shared Savings Program (MSSP) Centers for Medicare & Medicaid Innovation (CMMI) Pioneer and Advance Payment Models Other programs Bundled Payments, etc. Commercial initiatives Patient Centered Medical Home Pay for Performance Shared Savings Program 12

13 CMMI and MSSP ACOs CMMI = 32 Pioneer; 20 Advance Payment MSSP = 27 April July

14 Blue Cross Blue Shield Models Pay 4 Performance (Orange) - 46 States PCMH models (Green) - 39 States Episode-Based Payment (Blue) 32 States Source: Blue Cross Blue Shield Association, Forum on Innovation in Healthcare, Dallas, Texas May 20,

15 Takeaways Significant financial impact of payment reform today and in future Health care provider awareness of measurements for each program and implement strategies to maximize outcomes for each measure Alignment strategies Internal monitoring, reporting, policies and practices Reporting to Quality or other Board-level committees to increase awareness and facilitate improvement Strategic considerations near and long term Alignment Clinical integration Disease specific and population health management 15

16 Resources QualityNet - CMS Website VBP Assessment-Instruments/hospital-value-based-purchasing/index.html HACS Payment/HospitalAcqCond/index.html Readmissions Payment/AcuteInpatientPPS/Readmissions-Reduction-Program.html Hospital IQR Assessment-Instruments/HospitalQualityInits/HospitalRHQDAPU.html Hospital OQR Assessment- Instruments/HospitalQualityInits/HospitalOutpatientQualityReportingProgr am.html 16

17 2013 Health Care Regulatory Update Polsinelli Shughart PC January 8, 2013 PS v1

P4P Programs 9/13/2013. Medicare P4P Programs. Medicaid P4P Programs

P4P Programs 9/13/2013. Medicare P4P Programs. Medicaid P4P Programs P4P Programs Medicare P4P Programs Hospital Quality Reporting Programs (IQR and OQR) Hospital Value-Based Purchasing (VBP) Program Hospital Readmissions Reduction Program (HRRP) Hospital-Acquired Conditions