National Readmissions Summit: Health Policy and Its Impact on Transitions of Care September 2015
Why PAC Reform? 43 23 >8 One in five Beneficiaries are hospitalized at least once/year The percentage of Medicare patients utilizing PAC services following hospitalization PAC: 73% Acute: 27% Diagnostic Tests: 14% Procedures: 14% Drugs: 9% The percentage of total medical spend that PAC represents The rate at which Medicare spending on PAC grew annually from 2001-2012 If regional variation in PAC spend did not exist, Medicare spending variation would fall by 73%* HHA: of 37.4% 38.2% use more SNF: of 41.1% 59% use additional services IRF: of 10.3% 87.7% use more Outpatient Therapy: of 9.1% 34.4% use more LTCH: of 2.0% 74.9% use more Source: Gage et al. (2009). Examining post-acute care relationships in an integrated hospital system, ASPE. *Variation in Health Care Spending, Target Decision Making, Not Geography (2013). MedPAC and IOM
PAC Policy Reform Momentum Building Continued momentum and legislative initiatives to transform Medicare FFS reimbursement system, and incentivize more efficiently managed PAC CMS FFS Shifts Focus to Managing Care 2013: Bi-Partisan Bundling Legislation introduced in House 2012: Hospital Readmission Penalties instituted; up to 3% by 2015 across 5 conditions** 2012: ACOs go live; now over 350 Medicare ACOs 2010: ACA passed 2009: CMS ACE Demonstration 2005: DRA establishes PAC PRD 2014: Sen Wyden introduces Better Care, Lower Cost Act 2013: CBO Re-Scores Bundled Payments; White House & MedPAC join conversation 2014: CMS releases 2 Bundling RFI s 2014: BPCI programs rollout 2014: Rep McKinley introduces Bundling Legislation in House 2015: CMS BPCI expansion IMPACT Act becomes Law President s budget includes PAC bundling* 2017: Medicare FFS PAC Bundle??? IPPS NPRM Includes Bundling Expansion CCJR NPRM Released Other activity of historical relevance to the discussion includes the SNF Value Based Purchasing demonstration, Home Health Value Based Purchasing demonstration and the National Quality Strategy. *2016 President s budget included Implementing Bundled Payment for PAC Providers, beginning in 2020 accounting for $9.3 billion in proposed budget (2016-2025) ** 5 conditions for Readmission penalties include heart failure, heart attack, pneumonia, chronic lung problems and elective knee and hip replacements.
Hospital Readmission Penalties Hospitals can lose as much as 3% of their Medicare payments due to the 30-day hospital readmission penalty across 5 baseline conditions: 1. Heart Failure 2. Heart Attack 3. Pneumonia 4. Chronic Lung Problems 5. Elective Hip and Knee Replacements For penalized hospitals, CMS will reduce each payment for a patient stay from October 2014 through September 2015, which is the federal fiscal year. These penalties apply to patients admitted for any condition, not just the five conditions that were used to determine if a hospital had too many readmissions. Thus, if Medicare would normally pay a hospital $15,000 for a kidney failure patient, with a 1.5 percent penalty Medicare would deduct $225 and pay $14,775. Case Management
HHS: Volume to Value 90% Value-Based Payment by 2018 HHS Launches Payment and Learning Network on March 25 Source: CMS Press Release, January 26, 2015
CMS Payment Framework Category Description of Category FFS No Link to Quality 1 2 3 4 Traditional FFS with no link to quality or efficiency FFS Link to Quality At least a portion of payment varies based upon quality or efficiency Model FFS Hospital valuebased purchasing Hospital readmission reduction program Hospital-acquired conditions program Alternative Payment Model Built Around FFS Some payment linked to population delivery but payment still triggered by service delivery ACOs Medical Homes Bundles Comprehensive Primary Care Initiative Comprehensive ESRD Financial Alignment Demo FFS Model Source: http://www.cms.gov/newsroom/mediareleasedatabase/fact-sheets/2015-fact-sheets-items/2015-01-26-3.html Population Based Payment Model Payment not linked to service delivery and responsible for a longer period (e.g., greater than one year) Pioneer ACO (Years 3-5) Next Generation ACO
CMMI Activity: Covering the Nation with Innovation
CMMI Test: BPCI Basics Episode Services included in the bundle Model 1 Model 2 Model 3 Model 4 All acute patients, all DRGs All Part A services paid as part of the MS- DRG payment Selected DRGs, hospital plus post-acute period All non-hospice Part A and B services during the initial inpatient stay, post-acute period and readmissions Selected DRGs, post-acute period only All non-hospice Part A and B services during the post-acute period and readmissions Selected DRGs, hospital plus readmissions All nonhospice Part A and B services (including the hospital and physician) during initial inpatient stay and readmissions Payment Retrospective Retrospective Retrospective Prospective Intended to: Support and encourage providers to achieve better health, better care, and lower costs through continuous improvement Create a positive cycle that leads to decreasing the cost of an acute episode of care and the associated post-acute care while fostering quality improvement Develop and test payment models that create accountability Shorten the cycle time for adoption of evidence-based care Create environments that stimulate development of evidence-based knowledge
Bundling Poised for Major Growth in 2015 Model 2 Model 3 2,077 individual episode initiators 4,558 individual episode initiators Precedence rules will determine market impact; ACOs and bundles can co-exist
Selection of Episodes for Model 2 (out of 48) Diagnostic Families (aka Clinical Episodes) Percentage of At-Risk Model 2 Bundlers Major joint replacement of the lower extremity 86% Congestive heart failure 34% Chronic obstructive pulmonary disease, bronchitis, asthma 25% Simple pneumonia and respiratory infections 21% Hip and femur procedures except major joint 18% Revision of the hip or knee 16% Coronary artery bypass graft 15% Acute myocardial infarction 15% Lower extremity and humerus procedure except hip, foot, femur 13% Double joint replacement of the lower extremity 12% Removal of orthopedic devices 12% Stroke 12% Sepsis 12% These DRG families and percentages will likely change as more bundlers move to risk in 2015
Year One BPCI Evaluation Model 2-4 The three CMS evaluation and monitoring questions establish the framework for annual report: 1. What are the characteristics of the program and participants at baseline and how have they changed during the course of the initiative? 2. What is the impact of the BPCI initiative on the costs of episodes, the Medicare program and the quality of care for Medicare beneficiaries? 3. What program, provider, beneficiary, and environmental factors contributed to the various results of the BPCI initiative? Model 2 Model 3 Model 4 8 active awardees 9 hospital episode initiators Participating in 34 of the 48 episodes 6 active awardees 9 episode initiators Participating in 6 of the 48 episodes 1 active awardee Participating in 1 of the 48 episodes Released February 27Results as of Q4 2013
Will CMMI release another Initiative? CMMI released an RFI in February 2014, with comments due in April 2014 CMS Signals Interest in Complex Chronic Care and Outpatient Bundled Payments
CMMI Released NPRM on Mandatory Joint Bundles Comprehensive Care for Joint Replacement (CCJR) Payment Model for Acute Care Hospitals Furnishing Lower Extremity Joint Replacement Services Purpose Test Propose the creation and testing of a new model, Comprehensive Care for Joint Replacement (CCJR) Model under the CMMI Authority. Proposed model would REQUIRE the participation of hospitals in multiple geographic areas that might not otherwise participate in the testing of bundled payments for lower-extremity joint replacement (LEJR) procedures. Whether bundled payments to acute care hospitals for LEJR episodes of care will reduce Medicare expenditures while preserving or enhancing the quality of care for Medicare beneficiaries. Duration of Test 5 year performance period, beginning January 1, 2016 and ending December 31, 2020. MS-DRGs Included: 1. MS-DRG 469: Major joint replacement or reattachment of lower extremity with Major Complications or Comorbidities (MCC) 2. MS-DRG 470: Major joint replacement or reattachment of lower extremity without MCC Scope of Episode Episode would be initiated with an admission to an acute care hospital for an LEJR procedure that is assigned to MS-DRG 469 or 470 and paid under IPPS. Episode would end 90 days after date of discharge from the acute care hospital. Episode would include: LEJR Procedure, Inpatient stay, and all related care covered under Medicare Parts A and B within 90 days after discharge, including hospital care, post-acute care, and physician services. Participants Participant hospitals in the selected 75 MSA markets would be episode initiators and bear financial risk. Beneficiaries would be automatically included in the model. Retrospective reconciliation against a target price, with no downside risk for hospitals for performance year 1 that exceed their target price for year 1. Overlap with Ongoing CMS Models Overlap with Ongoing CMS Models Exclude certain hospitals participating in risk-bearing phase of BPCI Models 1, 2 and 4 for LEJR episodes. Beneficiaries will not be excluded in CCJR model episodes from being included in other CMMI initiatives- MSSP, etc.. There will be a method to account for overlap.
CMMI Released NPRM on Mandatory Joint Bundles Comprehensive Care for Joint Replacement (CCJR) Payment Model for Acute Care Hospitals Furnishing Lower Extremity Joint Replacement Services Quality Measures and Reporting Requirements Proposing three hospital-level quality of care measures for CCJR model: 1. Complication Measure 2. Readmission Measure 3. Patient Experience Survey Measure Data Sharing Hospitals would receive raw claims-level data and claims summary data by service line. CMS to provide hospitals with up to 3 years of retrospective claims data that will be used to develop their target price. Beneficiary Protections Financial Arrangements and Program Policy Waivers Beneficiaries retain right to obtain care from any qualified Medicare Provider. Beneficiaries cannot opt out of the CCJR. Hospitals will be required to supply written information to beneficiaries. Participant hospitals will be financially responsible for CCJR LEJR episodes as participants. Several waivers related to SNFs and physicians will be available. 3 day stay waiver, home visit waiver, telehealth waiver and gainshare waiver Economic Effects Expect proposed model to result in savings to Medicare of $153 million over the duration of the model (5 yrs.): Year 1: Cost Medicare $23 million given no downside risk, Year 2: Medicare Savings of $29 million, Year 3: Medicare Savings of $43 million, and Year 4 and 5: Move from target pricing based on hospital s experience to regional experience, Medicare Savings of $50 million and $53 million, respectively. Along with additional savings, based on performance. Comments Due September 8, 2015 Discount % included in target price/reconciliation payment eligibility Successfully submits THA/TKA voluntary data Does not successfully submit THA/TKA voluntary data Meets thresholds for all 3 required quality measures 1.7% and eligible 2.0% and eligible Does NOT meet thresholds for one or more of 3 required quality measures 1.7% and ineligible 2.0% and ineligible
PAC Reform Legislation Bundling and Coordinating Post-Acute Care (BACPAC) Act Re-introduced March 19 th in the 114 th Congress by Representative McKinley (R-WV)- 2015 Hearing Held by Energy and Commerce Subcommittee on Health, Medicare Post Acute Care (PAC) Delivery and Options to Improve It on April 16 witnesses included: Mark Miller, Executive Director of the Medicare Payment Advisory Commission (MedPAC); Steven Landers, M.D., M.P.H., President and CEO, Visiting Nurse Association Health Group; Samuel Hammerman, M.D., M.M.M., F.C.C.P., Chief Medical Officer, LTACH Hospital Division, Select Medical Corporation; Melissa Morley, Ph.D., Program Manager, Health Care Financing and Payment, RTI International; and Leonard Russ, Principal Partner, Bayberry Health Care, Chairman of American Health Care Association (AHCA). Comprehensive Care Payment Innovation Representatives Introduced in the 113 th Congress by Representative Black(R-TN) and Neal (D-MA)- 2014 15
The IMPACT Act National Association for the Support of Long Term Care Improving Medicare Post-Acute Care Transformation Act Signed into Law on October 6, 2014 16
Post-Acute Care Patterns of Use High variation impacts mean episode payment and length of stay Episode Pattern 1 Count (5% Sample) Percent of PAC Users (N=109,236) Cumulative Percent Mean Episode Payment Mean Episode Length of Stay AH 25,238 23.1 23.1 $ 12,696 48.9 AS 18,714 17.1 40.2 $ 17,930 44.2 ASH 8,474 7.8 48.0 $ 22,208 76.4 AO 6,533 6.0 54.0 $ 8,165 40.0 AHA 4,909 4.5 58.5 $ 25,035 57.2 AIH 3,066 2.8 61.3 $ 30,915 69.3 AHO 2,941 2.7 64.0 $ 14,250 88.0 ASAS 2,934 2.7 66.7 $ 33,346 81.7 ASA 2,092 1.9 68.6 $ 28,106 47.2 ASO 1,993 1.8 70.4 $ 18,805 87.1 AHAH 1,635 1.5 71.9 $ 26,956 171.5 AIO 1,467 1.3 73.2 $ 27,270 79.1 AI 1,382 1.3 74.5 $ 25,330 17.4 1. A=Acute Hospital; H=HHA; I=IRF; L=LTCH; O=Outpatient Therapy; S=SNF/ Source: Gage et al. (2009). Examining post-acute care relationships in an integrated hospital system, ASPE 17
Today, Tools Utilized Depend on Setting Acute Hospitals no standard tool, varies by hospital Long-Term Care Hospitals no standard tool, varies Inpatient Rehabilitation Facilities IRF-PAI Skilled Nursing Facilities MDS Home Health Agencies OASIS Comparison of Current Instruments Similarities Medical complexity Motor Functional status Cognitive status Social support and environmental factors Differences Individual items that measure each concept Rating scales used to measure items Look-back or assessment periods IRF- PAI-The Inpatient Rehabilitation Facility Patient Assessment Instrument MDS- Long Term Care Minimum Data Set OASIS- The Outcome and Assessment Information Set CARE- The Continuity Assessment Record and Evaluation 18
Comparison of Tools: Functional Status Tools No. of Functional Items Rating Scale Levels Assessment Periods IRF PAI 18 7 Past 3 days MDS 3.0 11 2 codes (6 &5) Past 7 days OASIS 8 Varies Assessment day CARE 25 6 2-3 day period Variation in Tool Utilization Driving the Need for Standardization IRF- PAI-The Inpatient Rehabilitation Facility Patient Assessment Instrument MDS- Long Term Care Minimum Data Set OASIS- The Outcome and Assessment Information Set CARE- The Continuity Assessment Record and Evaluation 19
Continuity Assessment Record and Evaluation (CARE) Development Based on review of existing assessment tools in Medicare program (MDS, OASIS, IRFPAI), hospital assessments + extensive input from each of the providers/research communities (hospitals, SNFs, HHAs providers/ accreditors/consumers) Reliability Tests Pilot Tests Public Comment CARE Development Association meetings and presentations Open Door Forums Technical Expert Panels
WHY NOW? What about the political environment combined with the payment and delivery transformation efforts underway made now the time to construct and pass legislation for Post-Acute Care?
The IMPACT Act: What does it do? Paves the way for standardizing post-acute care assessment data for quality, payment, and discharge planning, and for other purposes. All PAC providers including HH, SNF, IRF and LTCH s included Standardized collection on functional status, cognitive function, medical needs and conditions, impairments and other categories deemed necessary by Secretary Some data are already submitted by each PAC provider, but varies by type of provider, Act calls for replacing duplicative data collection Resource use data also collected to estimate per beneficiary spend Includes payment refinement provisions via report from MedPAC to Congress in 2016 based on PAC PRD data and report from CMS
Timeline of Activity: Home Health Agencies January 1, 2017 Reporting Quality Measures for skin integrity Reporting Quality Measures for medication reconciliation Reporting Resource Use and Other Measures January 1, 2019 Reporting Quality Measures for cognitive function and functional status Reporting Quality Measures for occurrence of major falls Reporting Quality Measures for the ability of a PAC provider to relay health information, and care preferences of an individual Reporting Alignment of Claims Data with Standardized Patient Assessment Data
Timeline of Activity: Skilled Nursing Facilities October 1, 2016 Reporting Quality Measures for cognitive function and functional status Reporting Quality Measures for skin integrity Reporting Quality Measures for occurrence of major falls Reporting Resource Use and Other Measures October 1, 2018 Reporting Quality Measures for medication reconciliation Reporting Quality Measures for the ability of a PAC provider to relay health information, and care preferences of an individual Reporting Alignment of Claims Data with Standardized Patient Assessment Data
Timeline of Activity: Inpatient Rehabilitation Facilities October 1, 2016 Reporting Quality Measures for cognitive function and functional status Reporting Quality Measures for skin integrity Reporting Quality Measures for occurrence of major falls Reporting Resource Use and Other Measures October 1, 2018 Reporting Quality Measures for medication reconciliation Reporting Quality Measures for the ability of a PAC provider to relay health information, and care preferences of an individual Reporting Alignment of Claims Data with Standardized Patient Assessment Data
Timeline of Activity: Long-Term Care Hospitals October 1, 2016 Reporting Quality Measures for skin integrity Reporting Quality Measures for occurrence of major falls Reporting Resource Use and Other Measures October 1, 2018 Reporting Quality Measures for cognitive function and functional status Reporting Quality Measures for medication reconciliation Reporting Quality Measures for the ability of a PAC provider to relay health information, and care preferences of an individual Reporting Alignment of Claims Data with Standardized Patient Assessment Data
How Will This Be Implemented? Setting-Agnostic Quality Measures The CMS Center for Clinical Standards and Quality will develop quality metrics that can measure patient s medical, functional, and cognitive status. Refined PAC Payment Approaches The CMS Center for Medicare will develop standardized payment methods for: Chronically Critically Ill populations Skilled Nursing Facility populations Inpatient Rehabilitation Facility populations Home Health populations 4
Where do we go from here? For the Next 19 Years, 10,000 People Will Turn 65 Years Old Everyday! 28
Questions AND Answers