CPAs & ADVISORS experience support // PREPARING FOR RISK-BASED OUTCOMES OF BUNDLED CARE Jackie Nussbaum MHA, CPC, CHFP, FHFMA Director Eric Rogers M.Ed. RT Managing Consultant
THE CHANGING HEALTH CARE MARKET THE CHANGING HEALTH CARE MARKET HHS goal of 30% of traditional FFS Medicare payments through Advanced Payment Models (APMs) by end of 2016 & 50% by end of 2018 100 90 80 70 60 50 40 30 20 10 0 2011 2015 2016 2018 FFS APMs 2 // experience support
THE CHANGING HEALTH CARE MARKET CMMI INNOVATION MODELS Accountable Care BPCI Primary Care Transition Medicaid and CHIP Acceleration Models Speed Adoption of Best Practices ACOs Model 1 Advanced Primary Care Initiative Reduce Avoidable Hospitalizations State Innovation Models Beneficiary Engagement Model Advanced Payment ACOs Model 2 Comprehensive Primary Care Initiative Financial Alignment Incentive for Medicare and Medicaid Frontier Community Health Integration Community Based Care Transitions ACO Investment Model Model 3 FQHC Advanced Primary Care Practice Strong Start for Mothers and Newborns Health Care Innovation Rounds Health Care Action and Learning Network Next Generation ACO Model 4 Graduate Nurse Education Medicaid Prevention of Chronic Diseases Health Plan Innovation Initiative Innovative Advisors Program Pioneer ACO CJR Transforming Clinical Practice Medicaid Emergency Psychiatric Demonstration Million Hearts 3 // experience support
BUNDLED PAYMENT POPULARITY 1000 900 800 700 600 500 400 300 200 100 0 Participants in CMMI Payment Models Source: CMMI Website 4 // experience support
BUNDLED PAYMENT 2013 BPCI Bundled Payments for Care Improvement Model 1 Retrospective acute care hospital stay Model 2 Retrospective acute care hospital stay + post-acute care 48 episodes 2 phases Model 3 Retrospective Post-acute care Model 4 Acute-care hospital stay 5 // experience support
MSA SELECTION 67 MSAs 6 // experience support
OHIO HOSPITALS LOCATED IN SELECTED CJR MSAS Atrium Medical Center Bay Park Community Hospital Bethesda North Crystal Clinic Orthopaedic Center Edwin Shaw Rehab Institute Flower Hospital Fort Hamilton Hughes Memorial Hospital Good Samaritan Hospital Mccullough-Hyde Memorial Hospital Mercy Health West Hospital Mercy Hospital Clermont Mercy Hospital Fairfield Mercy St. Anne Hospital Mercy St. Charles Hospital Mercy St. Vincent Medical Center Robinson Memorial Hospital St. Luke's Hospital Summa Barberton Hospital Summa Health System Hospitals Summa Western Reserve Hospital The Jewish Hospital, LLC Toledo Hospital TriHealth Evendale Hospital University of Cincinnati Medical Center, LLC University of Toledo Medical Center West Chester Hospital, LLC Wood County Hospital 7 // experience support
PREPARING FOR BUNDLED PAYMENTS From 67 MSAs to ALL MSAs From hips & knees to: COPD CHF AMI Pneumonia Oncology 8 // experience support
CJR MAKES CENTS TO CMS $150 $100 $120 $127 $50 $35 $71 In Millions $0 -$50 -$11 Hospital Repayments Medicare Gainsharing Net Medicare Impact -$100 -$150 -$200 2016 2017 2018 2019 2020 9 // experience support
PREPARING FOR BUNDLED PAYMENTS 10 // experience support
42 CFR PART 510 [CMS-5516-P] 60-day public commenting period on proposal ended Sept 8 th Numerous comments Effective April 1, 2016 Key Changes 2% to 3% discount New targets for fractures 67 MSAs 3 month delay Stop loss reduced Quality measures 11 // experience support
EPISODE DEFINITION: GENERAL Episodes are triggered by hospitalizations of eligible Medicare FFS beneficiaries discharged with diagnoses: MS-DRG 469: Major joint replacement or reattachment of lower extremity with major complications or comorbidities MS-DRG 470: Major joint replacement or reattachment of lower extremity without major complications or comorbidities Episodes include: Hospitalization & 90 days post-discharge All Part A & Part B services, with exception of certain excluded services that are clinically unrelated to episode 12 // experience support
EPISODE DEFINITION: SERVICES Included Physician services IP hospitalization (including readmissions) IP Psych Facility LTCH IRF SNF Home Health Hospital OP services Independent OP therapy Clinical lab DME Part B drugs Hospice Excluded Acute clinical conditions not arising from existing episode-related chronic clinical conditions or complications of LEJR surgery Chronic conditions that are generally not affected by LEJR procedure or post-surgical care 13 // experience support
PAYMENT AND PRICING: RISK STRUCTURE Retrospective, two-sided risk model with hospitals bearing financial responsibility Providers & suppliers continue to be paid via Medicare FFS In Year 2, actual episode spending will be compared to episode target prices If in aggregate target prices are greater than spending, hospital may receive reconciliation payment If in aggregate target prices are less than spending, hospitals would be responsible for making payment to Medicare 14 // experience support
PAYMENT AND PRICING: TARGET PRICE CMS intends to establish target prices for each participant hospital prior to start of each performance period Includes 3% discount to serve as Medicare s savings Based on blend of hospital-specific & regional episode data, transitioning to regional pricing. Essentially competing against yourself in the beginning Year Year Year 1 & 2 2/3 hospital 3 1/3 hospital 4 & 5 100% 1/3 regional 2/3 regional regional 15 // experience support
REGIONAL HISTORICAL CJR PAYMENTS DRG 469 DRG 470 $55,448 $47,928 $52,028 $50,954 $46,189 $51,239 $50,328 $47,925 $48,874 $24,858 $27,406 $25,480 $23,800 $25,989 $26,345 $27,464 $23,734 $23,425 New England Middle Atlantic East North Central West North Central South Atlantic East South Central West South Central Mountain Pacific 16 // experience support
TARGET PRICE CALCULATION: DRG 470 $26,000 $25,000 Wage Index DSH IME $24,000 $23,000 $25,480 $22,456 +/-? $ Target $22,000 $21,000 1/3 2/3 $20,000 Regional Average Sample Hospital Target Year 1 & 2 17 // experience support
UPSIDE AND DOWNSIDE FINANCIAL MODELING 0-20% Stop Loss $7,344,781 $9,330,051 Example Reconciliation Target 5-20% Stop Gain 359 Total Episodes Episode # 324 of 359 $63,460 $53,516 (2X SD) $25,480 18 // experience support
PAYMENT AND PRICING: LINK TO QUALITY Minimum threshold for two quality metrics Hospital Level Risk Standardized Complication Rate following elective hip & knee arthroplasty HCAHP 3 decile improvement Voluntary THA/TKA data submission of patient reported outcomes 19 // experience support
QUALITY POINTS THA/TKA Complications 90 th 10.00 8.00 80 th and < 90 th 9.25 7.40 70 th and < 80 th 8.50 6.80 60 th and < 70 th 7.75 6.20 50 th and < 60 th 7.00 5.60 40 th and < 50 th 6.25 5.00 30 th and < 40 th 5.50 4.40 <30 th 0.00 0.00 3 Decile Improvement 1.00 0.80 Yes 2.00 No 0.00 HCAHPS Survey THA/TKA Voluntary PRO and Limited Risk Variable Data Total Points 14.1 Poor: < 6.0 3% discount Good: 6.0 13.2 2% discount Excellent: > 13.2 1.5% discount 20 // experience support
FINANCIAL ARRANGEMENTS: GAINSHARING Consistent with applicable law, participating hospitals might have certain financial arrangements with Collaborators to support their efforts to improve quality & reduce costs Collaborators may include: Physician & non-physician practitioners Home health agencies SNF LTCH Physician group practices IRF Inpatient & Outpatient PTs & OTs 21 // experience support
FINANCIAL ARRANGEMENTS: GAINSHARING CJR Collaborators may share in both upside & downside risk associated with participating in program CJR requires signed written agreements with Collaborators & (if applicable) also agents of CJR Collaborators Collaborator Agreement Distribution Agreement CJR regulations set forth number of regulatory requirements be mindful of these requirements when establishing program & drafting documents/agreements Compliance with program requirements is necessary to be afforded protection under fraud & abuse waivers 22 // experience support
ALIGNMENT PAYMENTS Participant Hospitals may include following in sharing arrangement (& nothing else): Reconciliation Payments: payment from CMS to CJR hospital when hospital realizes positive Net Payment Reconciliation Amount (NPRA) Internal Cost Savings: measurable verifiable cost savings realized through care redesign activities associated with services furnished to beneficiaries during CJR episode Alignment Payments: payment from CJR Collaborator to Participant Hospital whereby Participant Hospital shares downside risk with CJR Collaborators 23 // experience support
CJR SELECTION CRITERIA Develop written selection criteria for CJR Collaborators Selection criteria for CJR Collaborators must relate to quality of care to be delivered (it can be prospective or retrospective) Examples from CMS include: Prior complication rates Attending weekly care coordination meeting Following specified clinical pathways Contacting CJR beneficiaries frequently Selection criteria cannot be based, directly or indirectly, on volume or value of referrals 24 // experience support
FINANCIAL ARRANGEMENTS: RISK SHARING Participant hospitals may assign various percentages of two-sided risk to collaborators CMS would continue to make reconciliation payments & recoupments solely with hospital Hospital would be responsible for paying/recouping from its collaborators CMS will limit hospital s sharing of risk to 50% of total repayment amount to CMS. Hospitals can t share more than 25% of risk with any one CJR Collaborator 25 // experience support
REQUIREMENTS Establish Board or other Governing Body oversight of CJR Update Compliance Plan to include oversight of CJR Maintain current & historical list of CJR Collaborators published on participant hospital s website Issue required Beneficiary Notifications (CMS to issue forms) Satisfy documentation requirements, e.g. Contemporaneous documentation of gainsharing payments Compliance requirements 10 year record retention Set-up process for EFT payments 26 // experience support
DEVELOPMENT OF CJR COLLABORATOR AGREEMENTS 1 2 3 4 Internal Cost Savings Strategy Engaging Collaborators Process Goal: Determine entities to approach as collaborators Understand Collaborator Agreements Satisfy written selection criteria requirements Identify specific collaboration goals Analyze available information & data to identify & select Collaborators Identify basic financial sharing methodologies Goal: Determine specific ICS parameters in Sharing Arrangements Identify incentive goals implant cost savings, OR efficiency, etc. Analyze available data for each goal Decision Support, EHR Develop internal cost savings methodologies in compliance with CJR Select Quality Performance Metrics & analyze potential outcomes Goal: Approach potential Collaborators & finalized arrangement parameters CJR Rule Education, Collaborator Agreements & Parameters of Agreements Provide scenario analyses based on levels of success Get collaborators comfortable with data & process Negotiate terms & parameters of Agreements (Financial & Quality) Identify related alignment opportunities Document sharing arrangements with negotiated parameters Ongoing Support Goal: Develop reporting mechanisms & monitor compliance of calculation Determine specific procedures to perform related to calculation Monitor performance of procedures Identify data anomalies Share progress with Collaborators Develop & implement control procedures for calculations 27 // experience support
PROGRAM WAIVERS Skilled Nursing Facility CJR would waive SNF 3-day rule for coverage of SNF stay following anchor hospitalization beginning in Year 2 Patients must be transferred to SNFs rated 3-stars or higher Beneficiaries must not be discharged prematurely to SNFs Home Visits CJR would waive incident to rule for physician services Allows licensed clinical staff of physician to furnish home visit in patient s home Permitted only for patients who do not qualify for Medicare coverage of home health services Maximum of nine visits using new HCPCS code Telehealth Waives geographic site requirement & originating site requirement to permit visits originating in patient s home or place of residence Cannot be substitute for in-person home health services Must be furnished in accordance with all other Medicare coverage & payment criteria 28 // experience support
DATA SHARING Data will be shared to evaluate practice patterns, redesign care delivery pathways & improve care coordination Hospitals can request to obtain beneficiary-level Part A & B claims for duration of episode in summary format, raw claims line feeds or both Data would be available for hospital s baseline period & on quarterly basis during performance period Aggregate regional claims data for MS-DRG 469 & 470 would also be shared Hospitals must request data in order to receive it 29 // experience support
OTHER ITEMS Beneficiary protection Providers & suppliers would be required to notify patients of payment model Patient s access to care would not be impacted by CJR model Copays would not change Patient provider relationships would be maintained Patients retain entitlement to Medicare covered services Monitoring CMS will monitor compliance with model requirements CMS will monitor potential risks Increasing profitability by delaying care Decreasing costs by avoiding medically indicated care Avoiding high cost patients Compromised quality or outcomes 30 // experience support
CASE STUDY 31 // experience support
GOVERNANCE AND OVERSIGHT Prehab Finance Acute Steering Committee IT Transitions PAC 1 32 // experience support
DATA ANALYTICS 1 2 33 // experience support
DATA ANALYTICS Patients Physicians Post-Acute Providers Risk Stratification 1 2 34 // experience support
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CARE PATHWAY VALUATION DRG 470 Post Acute Utilization $15,226 Home Health 71% Skilled Nursing 17% $9,213 Hospice 2% Other 10% $2,787 41 // experience support
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SPENDING BY AGE $40,000 160 $35,000 140 Medicare s Episode Payments $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 120 100 80 60 40 20 Patient Volume by Age $0 0-60 61-65 66-70 71-75 76-80 81-85 85-90 91-95 0 45 // experience support
USING DATA TO REDESIGN CARE DRG 470: TOTAL HIP VS. PARTIAL HIP 46 // experience support
PATIENTS PROCEDURE DISTRIBUTION: DRG 470 Partial Hip Total Hip Total Knee $31,934 13% $17,266 $16,777 20% 67% 47 // experience support
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MONITORING PROGRESS Monthly progress reports Key metrics dashboard Data Custodian Target price calculation Reconciliation 1 2 3 4 5 50 // experience support
PROJECT MANAGEMENT Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sept Oct Kick-off Work Groups Data Review Collaborator Update Progress Report Gainshare Review Outcomes Compass Data Analysis and Review Data Analytics Review: Outcomes Compass Collaborator Identification Gainshare Model Development Physician Workshop Post-Acute Workshop Value Stream Mapping Work Group Team Meeting Acute, Transitions, IT Work Group Team Meeting Post Acute Care Pathway Redesign Care Delivery Enhancement Care Coordination 1Q Reporting 2Q Reporting 3Q Reporting 4Q Reporting 51 // experience support
THANK YOU FOR MORE INFORMATION // For a complete list of our offices and subsidiaries, visit bkd.com or contact: Jackie Nussbaum MHA, CPC, CHFP, FHFMA // Director jnussbaum@bkd.com // 513.621.8300 Eric M. Rogers M.Ed. RT // Managing Consultant erogers@bkd.com // 417.865.8701 52 // experience support