MedPAC Meeting Highlights
The Medicare Payment Advisory Commission (MedPAC) held a public meeting last week and had a full plate of a variety of topics from Accountable Care Organizations (ACOs) to Medicare Part B drug payment issues.
Some takeaways:
- The Woes with ACOs: MedPAC found that in 2015, the Centers for Medicare & Medicaid Services (CMS) paid Medicare Shared Savings Program (MSSP) providers $625 million. This means that after paying out $429 to providers who generated enough for savings, the agency lost money. One commissioner recommended MedPAC look into organizations that generated savings for CMS in order to better gauge which factors make an ACO succeed. Though true that ACOs are slow to show the progress everyone is hoping for, it is important to note organizations that have been in the program longer are showing more success.
- Quality Measurement: MedPAC once again discussed the possibility of a premium support system to be implemented for Medicare. The conversation focused heavily on the commission’s alternative concept for measuring quality in Medicare as well as finding quality measures that can be used across Medicare Advantage (MA), ACOs, and Fee-for-Service (FFS). MedPAC is becoming increasingly concerned the current quality program relies on too many clinical process measures that do not strongly correlate with health outcomes. Under MedPAC’s proposal, Medicare would use a small set of population-based outcome measures and patient experience to compare quality of care under each of the three payment models in a local area. This was the first of many conversations MedPAC will have on this topic over the next year.
- Imminent Move toward Biosimilars: MedPAC seemed to offer much support in moving forward with the greater use of biosimilars under Part D. The use of biosimilars in Medicare would likely lead to drastic drug program savings, especially for chronic conditions such as diabetes. Solutions thrown around included extending the coverage gap discount to include biosimilars, something that is currently only applied to brand name drugs.
- Part B Drug Payment Policies: Given that Part B drug spending has grown at an average rate of more than 8 percent per year over the lastfive years, the commissioners ran through several proposals on how to address this growth and tackle Part B payments. Options considered included increasing price competition, consolidating billing codes, limiting average sales price (ASP) inflation, modifying the payment formula, improving data, and restructuring the competitive acquisition program (CAP). The discussion did not end with any recommendations other than to continue to work on this matter. Of course, we are all anxiously awaiting CMS’ response to the flood of comments to its Part B Drug Payment Proposal.
- Behavioral Health: It was also suggested MedPAC explore policy solutions to the weaknesses in behavioral health services under Medicare. The commission discussed exploring both weaknesses in inpatient facilities for serious mental health issues as well as care in ambulatory settings. Solutions thrown around included integrating primary care with behavioral health specialists and examining readmissions and emergency room data to determine what kind of readmission measures and penalties could be used to drive better inpatient performance.
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The 2017 Star Ratings are out! Join John Gorman, Gorman Health Group’s Founder & Executive Chairman, and colleagues Melissa Smith, our Vice President of Star Ratings, Lisa Erwin, our Senior Consultant of Pharmacy Solutions, and Daniel Weinrieb, our Senior Vice President of Healthcare Analytics & Risk Adjustment Solutions, on Thursday, October 27, from 1-2 pm ET, for a cross-functional review of the 2017 Star Ratings. Register now >>
Gorman Health Group (GHG) is offering a new capability to connect health plans and providers with social impact investors to obtain capital for clinical innovations of which many plans have only dreamed. Join us on Tuesday, November 1, from 2:30 to 3:30 p.m. ET, to learn how social impact investing can be used to improve health outcomes and Star Ratings and how your organization can benefit. Register now >>
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Hot Takes on Medicare Advantage and Part D in 2017
The Centers for Medicare & Medicaid Services (CMS) released its annual Medicare Advantage (MA) and Part D "landscape files" with data on plans and bids for 2017. It's a picture of programs that are rock-solid and driving insurers' revenues and earnings, offering better supplemental benefits for no increase in price for two-thirds of beneficiaries. Interestingly, CMS appears to be sandbagging its enrollment projections and assumed no growth for MA in 2017. We think we're heading to 4.2-4.5% enrollment growth, continuing a steady, winning drumbeat for the industry.
By the numbers, the landscape files showed the following:
- While the number of contracts with CMS dropped by 8%, the number of Plan Benefit Packages (PBPs) is virtually the same.
- The number of PBPs with $0 premium is virtually the same. Although the number of $0 premium Preferred Provider Organizations (PPOs) with prescription drugs has increased by 21 PBPs, the number of Health Maintenance Organizations (HMOs) with drugs has decreased.
- The number of PBPs with a $0 drug deductible has decreased 11% from last year.
- Approximately two-thirds of all beneficiaries on an enrollment-weighted basis will see no premium increase, and most will see additional supplemental benefits in 2017, such as vision, hearing, and dental care. The average enrollment-weighted premium is actually $1.19 less than 2016.
- Humana will offer the cheapest Prescription Drug Plan (PDP) in 22 of 34 regions. EnvisionRx, which was acquired by RiteAid last year, is the lowest bidder in 11 regions.
- WellCare and United showed improvement in Part D bidding and are now eligible for low-income auto-assigns in 8 and 27 regions, respectively.
- MA enrollment is up almost 60% since the passage of the Affordable Care Act (ACA) in 2010, smashing expectations of an exodus.
- Strangely, CMS implied in its announcement that MA growth would be flat in 2017. We're projecting year-over-year growth of 4.2-4.5% in 2017.
- Centene (which acquired Health Net), United, and Aetna expanded their service areas in several states.
By every measure, 2017 should be another good year for Medicare plans. Let's hope whoever wins this Presidential election doesn't screw it up.
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MACRA Flexibility Proposal
As we enter the last stretch of the year, many questions remain on what to expect from the Quality Payment Program as required by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) come January 1, 2017. With the final rule due in November, much of the industry is quick to point out the difficulty in preparing for a brand new reporting program in just a month. Reporting in 2017 will affect payments in 2019.
The Centers for Medicare & Medicaid Services (CMS) recently attempted to alleviate these concerns with a new flexibility proposal, effectively allowing those who choose to do so to put off fully jumping into the Quality Payment Program for the first year. There are four options under the proposal:
- Quality Program "Testing" — Practices can submit some data to the Quality Payment Program, including data from after January 1, 2017, in order to avoid a negative payment adjustment. CMS is providing this as a way to test that systems are working to allow for successful participation in 2018 and 2019.
- Partial Year Participation — This option allows for participation for a reduced number of days. Because practices would submit quality measures, technology use, and improvement activities, they could potentially qualify for a small positive payment adjustment under this option.
- Full Year Participation — Practices whose systems are ready on January 1 can jump in fully in order to reap a bigger positive payment adjustment than Option 2.
Advanced Alternative Payment Model (APM) — Practices can, of course, still choose to participate in the Quality Payment Program through an APM such as Shared Savings Track Program 2 or 3. This option would qualify for a 5 percent incentive payment in 2019.
This new flexibility proposal gives some leeway and buys time for practices that are not prepared to fully comply with the Quality Payment Program, however, there is still a lot of work to be done before now, January 1st, and during the first reporting year.
This new flexibility announcement affirms CMS expects to move forward January 1, 2017. It also means we should all brace for a steep learning curve and speed bumps the first year and will likely see much more guidance and interim regulations as both the industry and CMS come across these. Despite these new flexibility options, the need to prepare for the new payment model is pressing, and those who prepare the soonest will see the greatest success under MACRA.
Gorman Health Group's experienced team is currently working with the provider, health system, and health plan communities in determining the best approach to influence more efficient care delivery models that support clinicians and hospitals as they change the way they practice medicine and adapt to new payment and risk arrangements.
Our experts can review current operations to identify risks and opportunities, increase integration within clinical and pharmacy programs, design well-coordinated activities across multiple healthcare programs, and ensure your organization's infrastructure and tools are prepared for MACRA's impact on your bottom-line. From in-depth analytics and tactical support to strategic planning and implementation. We can help >>
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An "October Surprise" in Medicare Advantage Star Ratings
Each year, one of the most anticipated announcements in the Medicare Advantage (MA) industry is the Star Ratings and program technical guidance for the coming year from the Centers for Medicare & Medicaid Services (CMS). This year's includes an "October Surprise:" a little-known methodological change that could force dozens of 4- to 5-Star-rated plans to lose their hard-fought bonuses and rebates.
Roughly 370 MA plans are currently scored under the Star Ratings system, which we all know by now is graded on a curve. Plans above 4 Stars get substantial bonus payments and bid rebates from CMS and above 5 Stars can market and sell their products year-round. In this sense, plans below 4 Stars are circling the toilet bowl as there is only so long they can compete against the better benefits of 4+ Star plans. The Star Ratings for 2017 will likely knock many 4+ Star plans off their pedestals. Here's why: for 2017, for the first time, 188 new plans could be scored under Star Ratings.
- 64 of the 188 are Medicare-Medicaid Plans (MMPs), which CMS announced in June will be moved into their own separate Star Ratings program this fall. This is a bit of bad news for most MA plans, since their inclusion in the MA Star Ratings program would likely have helped fill the lowest end of the curve.
- The 124 that are left still represent enough mathematical volume that their performance will shift the bell curve. Most will likely earn an overall rating of 3 or 3.5 stars, which will cause rating dilution for those at 4+ Stars. If those plans have the same level of performance as the previous year, they will likely dip below 4 Stars. This is a looming disaster for those companies because they've already booked the bonus money and predicated their benefit designs and 2017 campaigns on receiving the rebate.
- Regarding the 6 "dead men walking" plans below 3 Stars for 3+ years and slated for termination: a "hospital improvement" bill, which passed the House and is still in the Senate, includes a provision to delay CMS' authority to terminate MA contracts based on poor Star Ratings for 3 years. It's possible these 6 plans may continue to fill the very lowest end of the Star Ratings bell curve, thus helping other low-performing plans by padding the lowest end of the bell curve.
Many plans are going to get a nasty shock when they dig into CMS' latest news. It's another stark reminder Star Ratings management is a constant campaign, and plans cannot afford to get comfortable when it comes to their quality performance.
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CMS recently notified plans of the first preview period for the 2017 initial Star Ratings data. It is critical for plans to begin the annual re-evaluation of Star Ratings performance now to pinpoint new problem areas, implement tactical actions, and identify improvement opportunities to raise ratings. Read full analysis >>
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CMS Announces Expansion of the Medicare Advantage Value-Based Insurance Design Model
The Centers for Medicare & Medicaid Services (CMS) announced plans to expand the Medicare Advantage (MA) Value-Based Insurance Design (VBID) model to more states and more conditions in 2018 without the experience of the first year's launch, which begins in January 2017. The schedule underlines the Administration's goal of rapidly expanding the use of innovative payment and delivery models that emphasize quality and good outcomes rather than volume of services. VBID models have been used in the private sector to better manage the costs and care of persons with high healthcare needs and the Medicare population, which has the largest number of persons with chronic care conditions, and offers the potential to see even better results for more people.
Under the demonstration, the requirement that the MA benefit package be uniform for all enrollees will be waived. The uniformity provision was adopted many years ago to ensure health plans did not use benefit design to exclude persons with conditions and disabilities requiring the use of many services and prescription drugs. Fortunately, over time, policymakers and plans have seen the value of programs that better manage the conditions of persons with chronic conditions, such as disease management programs, although participation has been lower than expected. The VBID model will allow MA plans to lower cost sharing, add services, and target providers considered "high value" for the selected chronic condition. MA and Part D plans will still be required to offer uniform benefits under the new model for all plan members with the target condition. As a beneficiary protection, participants in the VBID program can never pay more than other MA enrollees for their services or receive fewer benefits.
For 2018, the new states eligible to participate will include Texas, Michigan, and Alabama. Seven states and seven chronic conditions were selected for the first year of the demonstration. Participating plans will be announced in September 2016. The additional chronic conditions that will be available for VBID participants include rheumatoid arthritis and dementia. The second year model test program will allow MA organizations with at least one plan or a parent organization with one plan with 2,000 or more enrollees to offer VBID enrollment to other Plan Benefit Packages (PBPs) with at least 500 enrollees, thus expanding the number of participating plans and VBID participants.
CMS will conduct a webinar of the second year changes on August 24, 2016, at 2:00 pm EST. Participants may register at https://innovation.cms.gov/resources/vbid-2018changes.html.
CMS plans to issue a Request for Applications for the second year VBID model test program in the fall of 2016. Information on how to apply can be found at http://innovation.cms.gov/initiatives/VBID.
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From ACO-type incentives to bundled payments and contract capitation, to full professional and global capitation — where the potential is promising, we can help design and implement these arrangements. Contact us today to get started >>
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Medicare Advantage Pays Hospitals Less than Medicare
Researchers at Stanford University conducted a study of hospital payments by Medicare Advantage (MA) plans, Fee-for-Service (FFS) Medicare, and commercial insurers in 2009 and 2012 and found MA plans pay lower prices than FFS for most (but not all) types of admissions and in most (but not all) geographic areas. The study found:
- MA plans paid 8 percent less than FFS after adjusting for diagnostic-related group (DRG) and geographic area differences between MA and FFS.
- If differences in hospital networks are also taken into account, MA plans paid 5.6 percent less than traditional Medicare. Thus, about one-third of the 8 percent difference in MA and FFS prices is attributable to narrower MA networks.
- MA plans in areas with the highest FFS spending paid lower hospital prices than MA plans in areas with the lowest FFS spending.
- MA plans with the highest enrollment penetration rates paid lower hospital prices compared with MA plans in areas with lower MA penetration rates.
- MA plans pay less for admissions with short lengths of stay.
Commercial insurer rates were much higher than either MA or Medicare FFS rates. Commercial plans pay higher prices than FFS for almost all types of admissions in almost all geographic areas. Higher FFS spending was associated with lower commercial prices.
The researchers (Laurence C. Baker, M. Kate Bundorf, M. Devlin, and Daniel P. Kessler) undertook the study because the literature provides no systematic analysis of the unit prices MA plans pay relative to FFS payments and whether lower MA costs are due to lower quantities of services per patient, lower prices per treatment, or both. According to the researchers, the conventional wisdom is MA plans save costs by lowering the quantity of services, and MA plans pay more to providers because they lack the FFS monopsony purchasing power. The study concludes at least part of the cost advantage of MA plans is due to lower prices and not lower quantities than FFS.
The researchers recommended Medicare consider the market environment more broadly than the level of FFS spending when setting MA payments. The researchers also recommended FFS payments to hospitals be adjusted across geographic differences and DRGs to better reflect the market.
The study used the Centers for Medicare & Medicaid Services (CMS) FFS data on all hospital payments and claims data for patients from the Health Care Cost Institute (HCCI), which represents 27 percent of the non-elderly population and 31 percent of the elderly MA population. The actual hospital prices negotiated with plans were not available since they are considered proprietary.
The study methodology used the average price per admission across metropolitan areas adjusted for differences in hospital networks, geographic areas, and case mix. To account for case mix, the researchers used only the DRG pairs that were common to MA and FFS. The researchers noted several limitations to their study findings, for example, HCCI claims data are not identical to the national distribution of MA and commercial enrollees and do not capture unobserved differences in patient severity across insurers, e.g., MA and commercial hospital admissions may be more severe than FFS admissions due to prior admission and prescreening.
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Risky Business. Are You Ready for MACRA?
It turns out Uncle Sam has a plan. He tried mightily to bend that stiff cost curve. He threw everything he had at it — fixed prices, automatic reductions, sophisticated relative value schemes. He could not do it. Turns out the pen (or mouse) is mightier than the sword because almost all of the Medicare benefit spend flows with the ink (or electrons) that is released by the physician's hand. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) is a game changer like prospective payment system (PPS).
Humans are inherently risk-averse. Doctors are humans. This new Part B payment scheme is going to make them uncomfortable. The Medicare Merit-Based Incentive Payment System (MIPS) puts a percentage of Part B reimbursement at risk — a modest 43% initially, but it climbs quickly. The Centers for Medicare & Medicaid Services (CMS) estimates 88% of eligible practitioners will be feeling that in 2019. This year more than 200,000 doctors (roughly two in five) were penalized for failure to achieve meaningful use of electronic health records in performance year 2014. Many have decided to just accept the reductions like the person who collects parking tickets because it's just too much trouble to park in a lot.
Changes in the law can have unintended consequences. Prospective payment led to premature discharges from hospitals. The introduction of the physician fee schedule and sustainable growth rate targets led to an increase in the volume and intensity of services (or claims maybe). What will the consequences of MACRA be? Will the money at risk motivate physicians to be more efficient? Or will it lead them to shun traditional Medicare patients?
Yesterday, during a U.S. Senate Committee on Finance hearing on MACRA, CMS seemed to acknowledge the challenges of releasing the final rule for MACRA in November 2016, then measuring physicians immediately after that in January 2017 for 2019 payment basis. Clients and prospective clients should be aware that the potential delay recently discussed by the CMS Acting Administrator is not a delay of MACRA implementation. He referred to possibly delaying the start of the 'performance year' that will be used to adjust payments in 2019. The need to prepare for value based Part B payment is pressing, and those that prepare soonest can turn MACRA into an opportunity.
We have been talking to clients and friends around the industry. We are seeing a lot of interest in the alternatives to MIPS, that is the Alternative Payment Model (APM) approach. Those programs like Pioneer Accountable Care Organizations (ACOs) that take meaningful downside risk clearly have the potential for growth and profit, but they are not for the faint of heart. We believe for group practices and hospitals that bill for physician services, the middle road shows great promise. That alternative is to develop a Medicare Shared Savings Program (MSSP) ACO that avoids downside risk initially. This is a "Track One" ACO — it lets providers have less exposure to complex MIPS reporting and the opportunity to get ready for a potential launch into a higher risk approach later.
On July 7, 2016, CMS further solidified their commitment to MACRA (alternatively the Quality Payment Program (QPP) with the announcement of the proposed rule updating payment policies, payment rates, and quality provisions for services furnished under the Medicare Physician Fee Schedule (PFS) starting January 1, 2017. CMS is proposing modifications to the MSSP to update the quality measures set to align with the proposed measures for the QPP, changes to take beneficiary preferences for ACO assignment into consideration, and changes that would improve beneficiary protections when ACOs are approved to use the skilled nursing facility (SNF) three-day waiver rule. The writing is on the wall — CMS will continue to move towards standardization of government-sponsored health plans via clinical and financial policy to ensure dollars spent meet the goals of improved beneficiary health, better population health management, and a trend of cost containment.
Every organization in the healthcare industry will be impacted by MACRA; some will be directly impacted, others impacted indirectly, and some will be affected by unintended downstream consequences of the legislation. Regardless of whether you are a health plan, a provider organization or a vendor that supports providers or health plans, we can help.
Our experts can review operations to identify risks and opportunities, increase integration within clinical and pharmacy programs, design well-coordinated activities across multiple healthcare programs, and ensure that your organization's infrastructure and tools are prepared for MACRA's impact on the industry. From in-depth analytics and tactical support to thought leadership and strategic planning, we can help. Contact our team today >>
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Navigating the path to value. Elena Martin, GHG's Senior Director of Provider Innovations, outlines the MACRA quality payment program. Read now >>
Health Plans Need to Start Talking About Disparities in Care
On the heels of a recent groundbreaking RAND report on racial disparities in Medicare Advantage (MA), the US Department of Health & Human Services' Office of Civil Rights (OCR) issued a regulation that requires serious attention in health plans participating in MA, Part D, Medicaid, and ObamaCare. It's a game-changer in advancing health equity and reducing disparities.
The new regs, implementing Section 1557 (the nondiscrimination provision) of the Affordable Care Act, prohibit discrimination, marketing practices, or benefit designs that discriminate on the basis of race, color, national origin, sex, age, or disability. This will escalate disparities from simply being a "quality improvement need" to being a huge compliance issue. It goes without saying that an investigation of your plan by the civil rights cops splashed across local news would be devastating. As the Centers for Medicare & Medicaid Services (CMS) has begun more aggressively using their data to identify these disparities, health plans certainly should begin doing the same.
The final rule prohibits sex discrimination in healthcare, including by:
- Individuals cannot be denied healthcare or health coverage based on their sex, including their gender identity and sex stereotyping. These last two items are of particular importance given transgender policy enforcement is relatively new. OCR has prosecuted cases recently where transgender patients were discriminated against in hospital admissions and room assignments, denying mammograms to transgender females, denial of gender reassignment surgery as "cosmetic," and harassment by medical transport drivers.
- Women must be treated equally with men in the healthcare they receive and the insurance they obtain. OCR has prosecuted several cases recently where hospitals assigned male guarantors when a wife obtained services but not the other way around.
- Categorical coverage exclusions or limitations for all healthcare services related to gender transition are discriminatory.
- Individuals must be treated consistent with their gender identity, including in access to facilities.
- Sex-specific health programs or activities are permissible only if the entity can demonstrate an exceedingly persuasive justification.
The regs also include important protections for individuals with disabilities and those with limited English proficiency by:
- Requiring covered entities to take appropriate steps to ensure communications with individuals with disabilities are as effective as communication with others.
- Covered entities must post a notice of individuals' rights, providing information about communication assistance, among other information.
- Covered entities are required to make all programs and activities provided through electronic and information technology accessible to individuals with disabilities, unless doing so would impose undue financial or administrative burdens.
- Covered entities cannot use marketing practices or benefit designs that discriminate on the basis of disability.
- Covered entities must make reasonable changes to policies, practices, and procedures, where necessary, to provide equal access for individuals with disabilities.
- Requiring covered entities to make electronic information and newly constructed or altered facilities accessible to individuals with disabilities and to provide appropriate auxiliary aids and services for individuals with disabilities.
- Requiring covered entities to take reasonable steps to provide meaningful access to individuals with limited English proficiency. Covered entities are also encouraged to develop language access plans.
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CMS recently announced the release of the 2017 Medicare Marketing Guidelines for Medicare Advantage Organizations and Part D Sponsors, which include added language, clarifications, and new requirements. Join Regan Pennypacker, GHG's Senior Vice President of Compliance Solutions, and Carrie Barker-Settles, Director of Sales and Marketing Services, on Tuesday, June 28, from 1-2 pm ET, to discuss what provisions in the final guidelines will have the greatest impact on your organization and how plan sponsors can prepare for the upcoming changes. Register now >>
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The Path to Value: The MACRA Quality Payment Program
To quote Yogi Berra, "If you come to a fork in the road, take it." Great, but exactly which fork do I take when faced with multiple options? That is the question many provider-led organizations are asking today.
On April 27, 2016, the Centers for Medicare & Medicaid Services (CMS) unveiled key provisions of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), a bipartisan legislation that replaced the Sustainable Growth Rate (SGR) formula with a new approach to paying clinicians for the value and quality of care they provide. The proposed rule would implement these changes through a unified framework called the Quality Payment Program (QPP), which includes two paths.
To the left, we have the Merit-Based Incentive Payment System (MIPS), and to the right, Advanced Alternative Payment Models (APMs). So what is a doctor or medical group to do at these crossroads?
The MIPS path leads to a world where a percentage of Fee-for-Service (FFS) Medicare payments are at risk based on performance in quality measures in four areas: Quality, Use of Information Technology, Clinical Practice Improvement, and Cost. Measurement would begin in 2017, and the rubber hits the road in 2019. By 2022, the portion of reimbursement at risk will be at 9% and could go beyond that. "MIPS is going to be the "new norm" for providers," said David Sayen, Senior Vice President of Client Relations at Gorman Health Group. "There will be no more hand wringing about draconian cuts to physician payments and, per Kerry Weems' clever quip, no regularly scheduled annual hostage taking."
However, it is important to keep in mind this is a zero sum game. To pay off the winners, there have to be losers, and nobody wants to be a loser. So we head to the other fork, which appears to have sunny skies and bluebirds just over the first hill. First, there is a hill. Moreover, for those providers who are starting to round the corner and take their initial steps into value-based risk sharing arrangements, it is never too early to start thinking about the right path for you and your organization.
For those providers who have taken a few steps or even large strides down the value-based fork and have a good understanding of their quality/cost compared metrics, have tightened their belts, and have a good understanding of contracting and negotiating risk sharing arrangements with payers, to get over the hill, you have to get onboard the APM train. Through future rulemaking, CMS will determine which APMs are acceptable as alternatives to MIPS and will be looking for models that have risk components as equally robust as MIPS.
We now know the Medicare Shared Savings Program (MSSP) Tracks 2 and 3 have been identified as APMs and would be exempt from MIPS payment adjustments. Additionally, they would qualify for a 5% Medicare Part B incentive payment. To qualify for incentives, clinicians would have to receive enough of their payments or see enough of their patients through Advanced APMs. Currently, only 5% of the 433 MSSP Accountable Care Organizations (ACOs) are participating in Tracks 2 and 3. However, the other 95% are gaining the experience they need to make actionable decisions on which fork their organization needs to move towards to prepare for the changes.
For organizations interested in taking the step towards forming a Medicare ACO, and potentially having the opportunity to participate in the QPP as an MSSP Track 2 or 3 via the Advanced APMs, the time for action is now. Your MSSP Notice of Intent to Apply is due May 31, 2016. Gorman Health Group (GHG) is available to help you understand the current MSSP requirements and your organization's readiness level. With the proposed changes to resetting the benchmark to incorporate factors based on regional FFS expenditures to establishing and updating the ACO's rebased historical benchmark, including an adjustment to the benchmark based on regional spending that is phased in over several agreement periods, GHG can assist in identifying health cost trends that vary in communities by using regional spending growth trends. As your organization makes the cultural shift towards a value-based model and establishment of essential ACO functions, we can assist in identifying priorities and goals for each functional area and developing a plan that is actionable, from the first step in applying to be an MSSP through implementation.
MSSP applications are due no later than July 29, 2016, at 5:00 p.m. EST. Please feel free to reach out to GHG for assistance in navigating the application. Alternatively, if you are a provider organization that would like to talk through key questions to ask prior to entering into a risk contract, we can help there, too.
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We've assisted scores of organizations through every step of the application process, from gathering the right data, completing the application, submitting, and responding to follow-up questions. Don't let the application process get in the way of your day-to-day operations. Contact us today to ensure a smooth, compliant process >>
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Why are the Dual Eligible Demos Such a Hot Mess?
There's no avoiding the steady stream of bad news facing the Centers for Medicare & Medicaid Services (CMS) financial alignment demonstrations for dually eligible beneficiaries. Enrollment is declining, beneficiaries are opting out at epic rates, and leading states like California are slowing their efforts despite crushing budget realities. Dozens of health plans have invested millions to participate in what's become a hot mess. Where do we go from here?
An early priority of the Affordable Care Act was to give states great flexibility in transitioning dual eligibles into health plans. Back in October 2013, over 60 participating health plans began enrolling dual eligibles through three-way capitated contracts with 13 states (VA, MA, IL, OH, CA, TX, SC, MI, NY, MN, CO, WA, RI) and CMS, representing a $40 billion annual revenue opportunity. After a strong start through the first half of 2015, the pilot programs for the most vulnerable patients in the U.S. health system started hemorrhaging. Net enrollment has declined for the last 4 months. Overall, only 30% of eligible beneficiaries are enrolled — way below expectations. The demos have been plagued by beneficiary opt-outs over 70% in some states, scared off by anti-managed care providers and advocacy groups. In some states, over one-third of eligibles "simply can't be found."
Some of these issues, like difficulty in locating dual eligibles given their widespread transiency, come with the territory and call for a much more aggressive community-based outreach and education campaign by state officials prior to the launch of these demonstrations. High rates of opt-outs show that outreach also must include providers and advocacy groups, especially those for the disabled, who "defined the terms of the debate" with beneficiaries and talked them out of participating before launch. One advocate noted, "Seniors have many doctors because they have multiple chronic conditions. Even the thought of losing a physician … is enough not to sign up."
Last year, CMS conducted an independent analysis of the state demos, which found that states didn't realize how much it would cost to implement, especially in IT infrastructure. They found huge issues with enrollment, despite a phased approach, and found health plans had a hard time keeping up with basic reconciliation, coverage and payment transactions. With this came the issue of trying to find beneficiaries to complete their initial health assessments and to educate them on the benefits of the demo in the first 90 days of enrollment. Large-scale demos, such as in Los Angeles County, were plagued with problems, whereas less ambitious launches went more smoothly. This argues for more 1915(c) home and community-based services waivers on a smaller scale and less monster 1115 waiver projects.
But the fundamental issue remains — the enrollment process —and here is where policy must change. Focus groups show that more than 40% of opt-outs were unaware they had done so — this in a state where 89% of enrollees are satisfied with the program once they are in it. This argues that voluntary enrollment is counterproductive to the goal of enrolling dual eligibles in coordinated care. Massive community-level outreach to beneficiaries, advocates, and providers must be required and paid for, followed by passive and/or facilitated enrollment processes that automatically enroll beneficiaries into plans unless they affirmatively choose otherwise. Anything less only results in pilot projects that fail to thrive.
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Join us on Thursday, May 26, from 1-2 pm ET, for an in-depth webinar analysis of the key changes finalized in the new Medicaid regulation, how these changes will affect states and managed care plans, as well as how to adapt. Register now >>
More than 200 health plan clients and an additional broad range of other industry participants each year trust Gorman Health Group's team of professionals to deliver expert counsel and tools to help them meet their goals. We pride ourselves on having both day-to-day alignment with the latest CMS guidance and the long-term strategic vision to keep it all in perspective. Contact us today >>
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