Join us Thursday for First in New Webinar series: Risk adjustment in the exchanges
On Thursday July 26th at 1pm ET we'll kick off our new webinar series, "Lessons from Medicare Advantage and Part D", a monthly webinar series around what we've learned in Medicare that can be applied to the exchanges and other aspects of health reform. We'll begin with a deep dive on risk adjustment in the exchanges.
Risk adjustment is the defining health care finance issue of the decade, and MA and Part D represent the largest experiments in risk adjustment on the planet. MA and Part D's risk adjustment system is the blueprint for ACOs, the exchanges, and a growing number of state Medicaid programs as well. We'll explore the risk adjustment provisions in the ACA and the final regulation, and apply what we've learned in the last 7 years to the future of health plan payment, with our partner Dr. Jack McCallum, CEO of GHG sister firm CenseoHealth. Bring your CFO, Chief Strategy Officer, CMO,Chief Marketing Officer, and your actuaries for a geektastic discussion on how to follow the money post-2013. In the coming months we'll examine other reform topics where the Medicare, Part D and Medicaid Dual Eligible experience shines a light: In early September: Distribution In and Around the Exchanges: Lessons from MA and Part D. We'll explore how individuals with subsidies and small groups will be sold the "metal" plans, especially in the Exchanges through Navigators and other impartial facilitators, to the deployment of brokers and sales management. Our focus will be on the Federally-Facilitated Exchange, which could operate in as many as 40 states, with updates on specific states as applicable. In late September: we'll explore the Nuts and Bolts of the Federal Exchange: Lessons from MA and Part D. We'll focus on how the Federal Exchange will function from a 10,000-foot level perspective, where the plan interfaces are and the broad strokes of anticipated reporting requirements. In late October: Product Strategy in the Exchanges: Lessons from MA and Part D. How subsidies will work based on income determinations; a landscape view of where states are on accepting ACA Medicaid expansion dollars in the wake of the SCOTUS ruling. For Red States: what the new "near-Medicaid coverage gap" means in those states that refuse the ACA funds. We'll examine how to segment the market for Platinum, Gold, Silver, and Bronze plans, and the allowability of supplemental insurance products (like dental) in the exchanges. What existing commercial and government programs provider networks mean to product pricing and strategy. The imperative for a database of local individual claims to wargame product designs on. More to come. The scars on our collective backsides in Medicare the last 16 years provide some great "teachable moments" for the new world post-ACA. We look forward to the discussion.
Times Are A-Changin'...Get Your Team to the GHG Forum June 12-13
In response to client requests, GHG is holding its first-ever Client Forum June 12-13 in Washington. With so much change in the air in government programs, the Forum is the perfect opportunity to get your team focused on the road ahead.
This isn't a disjointed lineup of vendors selling from the podium like at your usual industry conference: the presenters are all GHG's elite subject-matter experts, and the agenda is designed to be a silo-busting deep dive for government programs executive teams, with downtime built-in to allow you and your team to process and plan ahead. If you want answers, this is your gathering.
Change is a constant in the government programs world, and most of the folks who call us for help are those who are too busy these days to do anything but react. We have a motto at GHG: you can't react your way to excellence. Take two days to join us, bring your team leaders, and learn about how to get ahead of what's coming.
Don't waste your travel budget
We're less than three months from the GHG Forum. This is NOT your usual conference. We've developed a unique educational retreat for management teams working in government programs. I'm thrilled at the presentations our faculty are preparing: we're putting our senior consultants on the stage to deliver case studies, war stories and tales of best practices. But just as importantly, we're building in time for you to react to these sessions with your team--- to develop questions for your track faculty, compare notes, discuss implementing the best practices you've learned about.
We know it's a new concept in an industry that's become accustomed to sales people masquerading as subject matter experts. But we think that's it's badly needed. Many management teams we work with bemoan the lack of time and space to learn, collaborate and plan for success. In this environment, it's easy to simply react. But no one has ever reacted their way to excellence.
No doubt, if you send one to two people they will benefit individually. But isn't the isolation of our departments from each other central to our basic challenge of reforming our plans? We invite you to join other plans (some are sending as many as a dozen attendees) in making the GHG Forum your travel investment for the year. Send a team. We'll show you around.
Oregon Leads the Way on End-of-Life Planning
Kaiser Health News is out with a terrific story today on Oregon's progress with end-of-life planning for its seniors. The secret to its success has been a simpler-than-expected solution that a number of states have already adopted or are considering, and it's one of the most encouraging signs of progress in the field since the dark days of "Death Panels" during the 2008 campaign.
Oregon has been in the forefront of trying to make sure a person has as much control over the end of his or her life as possible. The state pioneered a form known as a POLST, for Physician Orders for Life-Sustaining Treatment, that has been adopted by 14 states and is being considered in 20 more. The form offers many more detailed options than a simple "do not resuscitate" directive.
The Oregon legislature set up a database several years ago to deal with the problem of inaccessible POLST forms.Now EMTs and doctors can access the state database to see if someone wants to be resuscitated. That database is beginning to generate some interesting facts about the medical interventions people want as they die, according to Dr. Susan Tolle of the Oregon Center for Ethics in Health Care. "We have really learned that this is not a black and white process," Tolle says. "Less than 10 percent of people wanted to refuse all treatment. A majority want some things and not other things." Tolle avoids the topic of whether these detailed end-of-life instructions save money; she is wary of starting another "death panels" debate. But the database has allowed the state to quantify the policy by some measures.
"What we found was that if people marked 'comfort measures only' and 'do not resuscitate' and did not want to go back to the hospital...there was a 67 percent reduction in life sustaining treatments, primarily hospitalization and emergency room visits," says Tolle.
As we've long said, there can be no hope of long-term Medicare solvency without more rational policy and assistance to seniors as they decide how they want to die -- not when Medicare spends 1 in 4 dollars today on care in the last 6 months of life. The POLST solution -- a standardized document with physician support and an accessible database -- is cheap, effective, and should be encouraged by CMS and the Administration. And it's heartening that Senator Ron Wyden is from Oregon and deeply enmeshed in these issues -- Oregon's approach should be embodied in his work with Rep. Paul Ryan on Medicare reform next year.
New CMS HSD Guidance Issued - What's New?
In case you haven't studied the recent CMS HSD Guidance memo, let me save you some time (and pain). This is the first of my blogs on the new CMS changes that will impact all MA Plans filing this year for a 2013 product launch. Here's what caught my attention:
• County Designations Changed - This change could move a county from Major Metro to Metro; or the reverse. These changes may have an immediate impact on your network requirements. You may even want to revisit the counties you pulled last season and see if they now meet CMS standards. One Plan who examined the new standards found some of their CMS "Failed" counties now "Pass".
• Providers Dropped - CMS dropped Laboratory and Intestinal Transplant from the network requirements. Let's hope this trend continues next year. I'm sure, like me, you have a couple of specialties you'd like to see dropped.
• Physician's Assistants and Nurse Practitioners — Something is going on with CMS' view of these providers. In the guidance they now call contracting with these providers a "rare" occurrence and seem to narrow their use to rural areas where they can practice independently. We'll follow-up on this change for clarification.
• Geriatrics — CMS has clarified the specialty to those providers that have special knowledge and interest. No mention of a board specialty requirement.
• Cardiac and Thoracic Surgeons — CMS now appears to acknowledge that these specialties are governed by a single board academy. However both specialties continue to be required on the HSD Provider Table. I'm hoping what CMS has separated can be reunited next year.
• Hospital Based Providers — MA Plans are now officially relieved of contracting with Radiology, Anesthesiology, Pathology and Emergency Medicine providers. Plans must now only assure that members seeing these providers pay in-network co-pays.
We at Gorman are staying on top of these changes in CMS Network requirements so that we can assist you in making strategic decisions for MA expansion. Our Network development team is keeping abreast of specific market changes to maintain our edge on our market intel and give folks who work with us the latest impact knowledge.
The Doc Fix Returns
The collapse of the Congressional Deficit "Not-So-Super-Committee" ushered in the return of the "doc fix". With only days left in the Congressional session, lawmakers will be scurrying to address several key healthcare issues, including the imminent 27% physician cut to Medicare FFS rates to physicians, and also the 2013 sequestration across the board cuts to Medicare of 2%. 2012 is an election year. The last thing the President and Members of Congress want is 600,000 members of the American Medical Association declaring war on January 2.
The most time-sensitive remains the doc-fix, as the 27% cut goes into effect on December 31, 2011, if lawmakers do not offset it. Every year since 2002, Congress has "kicked the can" a year or two down the road with temporary fixes. A permanent fix holds a price tag of almost $300 billion, and the hope was the "Supers" would get to it. They didn't, and a permanent fix is WAY out of reach now.
What seems likely is another retroactive adjustment early next year. Lawmakers are considering a 1- or 2-year fix costing $20.6 billion and $38.6 billion, respectively, with possible offsets including reductions to other providers. I'd expect another string attached will be that docs that don't hit their quality measures will take the cut, while high-performing providers will get the fix. This is an important issue way beyond physicians: if Congress doesn't get a fix done, Medicare Advantage rates will get hit in 2013 by as much as 1-2%.
While the doc fix will be addressed as soon as this week, don't expect any "holiday surprise" of a grand bargain on the sequestration cuts or deficit reduction given the political chasm between the parties and the upcoming election. Congress will do the bare minimum to avoid a "white-coat insurrection" but will punt the broader debate on austerity measures for Medicare and Medicaid to the voters next year.
Get Ready for Network Shock
Have you submitted an application to CMS to expand your provider network lately? If not, you may be in for a big surprise. Inadequate provider networks have always been the number one reason CMS rejects Medicare Advantage (MA) applications. But in recent years CMS has raised the bar even higher.
So what's so new at CMS? Here are just a few of the significant changes for networks:
• CMS has created totally new and rigid network adequacy standards for all MA Plans wanting to build or expand;
• Provider access time and distance standards now exist for every MA eligible county;
• CMS now defines the required contracted provider counts for every physician and facility specialty for each County;
• Minimum bed counts are now also required for hospitals and related services;
• MA Plans must contract with 35 physician specialties and 25 hospital and ancillary types to demonstrate adequacy to CMS;
• Ninety percent (90%) of the all Medicare beneficiaries in the county must be able to access every required physician and facility specialties using the time and distance standards;
• CMS commissioned new analytic software they use to calculate MA Plan's network adequacy;
• The new software objectively determines if your network passes or fails. If you don't own or have access to this software you are at an extreme disadvantage;
• The applications from Plans failing to attain ninety percent (90%) adequacy in each of the 60 required provider specialties are now routinely denied;
• Your Application will be in jeopardy if even one physician or ancillary specialty fails to meet the new rigorous CMS standards.
Are your networks ready for CMS scrutiny? If not, let GHG's Provider Network team help you prepare. We can analyze your network with Quest Analytics, the same software CMS uses. Over the past decade, Gorman has assisted numerous health plans build CMS compliant networks. We can meet your needs whether it is a full turn-key development or simply filling gaps in your existing network.
We invite you to contact us if you'd like to learn more about how Gorman can assist building a successful CMS compliant Network.
Medicare ACO Regs Out While Private Sector Surges
CMS released the final Medicare ACO Shared Savings Program regulations yesterday after taking a beating in over 1,200 industry comments on the draft. Let's hope they made some big changes, as Medicare is in danger of being left in the dust as ACOs surge forward in the commercial sector.
Aetna has created a company-wide organization whose entire focus is on integrating ACOs into all products and services . The HealthPartners Total Cost of Care system is now applied to two-thirds of its members, Wellpoint's multi-payer Medical Home model is expanding beyond California and New York with emerging evidence of its success, and Blues plans in Massachusetts, New Jersey and Maryland are moving forward with their own commercial ACO initiatives. Ten large national and regional health plans gave an update on how fast the ACO concept is exploding.
By contrast, the Medicare ACO program has been quiet as CMS toiled away on a rewrite of the regs, with the final rules out yesterday but relatively little interest emerging beyond the Pioneer ACO Demonstration finalists -- and many of them are still tentative pending review of the new final rule. All 7 of Gorman Health Group's applicants for Pioneer were selected -- but they're not necessarily in yet. CMS's recalcitrance on considering partial and global capitation models for Pioneers is tamping down our clients' enthusiasm as we're told capitation isn't operationally feasible for CMS until Year 3 of the demo. If the final reg isn't a dramatic improvement over the "fart in church" draft regulation in March, I worry that CMS will be left at the altar as payers and providers seek less burdensome opportunities in the commercial and Medicaid markets.
Watch this page for our take on the final regs.
Should Medicare premium information be shared with PPO providers?
CMS and the Center for Medicare and Medicaid Innovation (CMMI), in an effort to provide a more coordinated and satisfactory patient experience when it comes to the delivery of healthcare services, has placed much focus on improving Medicare program transparency around access to services, provider quality measures, clinical outcomes and fair pricing.
It is fair to ask whether or not providers - who are responsible for the delivery of clinical diagnosis and treatment to Medicare beneficiaries - should have knowledge about the beneficiaries' benefit plan and premium costs, including copayments and coinsurance. There is reasonable argument on both sides of this issue regarding patient privacy, the right to know or not know, as well as the opinion that a provider or supplier does not need to know a beneficiary's premium payments to price the service or item provided.
Those in favor of providing provider and suppliers with premium information might suggest that the information helps the provider find less expensive treatment alternatives when the benefit plan and related financial requirements would otherwise prove problematic. Others would opine that the provider's number one concern should be the patient's needs and hoped-for outcome.
There is, however, another reason that it might make sense to share premium information with providers and suppliers: Providers, like the patient, usually do not appreciate the financial relationship between the monthly dollar amount assigned to each patient for provision of medical care and the actual cost charged for providing that medical care. Knowing that relationship may have the desired effect of providers, suppliers and the patient agreeing on a treatment approach that is more judicious regarding the ordering of procedures, tests and supplies that may not be necessary in every case for the desired treatment outcomes.
At the end of the day there is a limit to the financial resources available for the funding of medical services. If everyone involved in the provison of medical services and supplies understands those limitations, then decisions on how those resources are expended may beome more measured without sacrificing service quality or treatment outcomes.
Pioneers Move Forward, But Medicare May Still Be Left Behind on ACOs
A CMS official announced Tuesday that final regulations for the Medicare Accountable Care Organization (ACO) Shared Savings Program are now expected mid-October. It looks like ACA's requirement that the SSP launch January 1 is now out of reach, and there's scuttlebutt here in DC that the launch date will be pushed to June or July 2012. These regs can't come fast enough -- and must be dramatically redrafted from the disastrous April draft -- or Medicare could be left behind as the ACO revolution surges just about everywhere else.
Sure, the Pioneer ACO Demonstration was some progress, especially on the beneficiary alignment provisions and the apparent willingness of CMS to consider our partial capitation proposals. All 6 of GHG's applicants for Pioneer made it to the finals this week, advancing both partial (Part B only) and global (Parts A and B capitated, excluding transplants and ESRD) capitation models. CMS intends to pick 25-30 Pioneer ACOs to launch on January 1 -- these are the advanced "already ACOs" that are ready to go given their significant integration and deep experience in Medicare Advantage -- and they'll give CMS some early wins to tout to a skeptical Congress. We are thrilled all of our Pioneers are moving forward -- with no arrows in their backs yet.
But it's the Shared Savings Program with its applicability to a much broader swath of providers that's significant here -- and that messy draft reg from last spring was like a cold shower from Medicare for most providers that might consider it. The irony is the draft regs forced many sophisticated provider systems and medical groups to recommit themselves to Medicare Advantage. CMS got over 1,200 comments on the NPRM and we're hopeful next month's final reg gets it right.
The ACO train is leaving the station in both the Medicaid and commercial markets, and Medicare must be on it if there's to be any hope of significant delivery system reform. Take for example the following initiatives being undertaken by the major payers:
- United Health Group has 1 ACO in Tucson and expects to expand to 9-13 this year
- Aetna is in more than 100 conversations about building ACOs and is actively marketing ACO back end operations functions to providers
- Centura is developing a strategy to market ACO development and operations support functions and is pursuing several ACO pilots in the commercial market
- Cigna has ACO experiments in 12 markets expanding to 30 by year end
- Humana is in discussions to develop ACOs in several of its markets, especially FL and AZ
- Wellpoint is partnering with major medical groups to establish ACOs
- Coventry is creating ACO models and may roll them out first in support of its Medicaid diversification strategy
- HealthSpring has committed to a major ACO development initiative with its major provider groups and clinics its acquired in the Bravo transaction
We're crossing our fingers that our friends in the CMS Innovation Center took those 1,200 comments to heart and that we'll see a viable final reg on ACOs next month. Broad participation in Medicare by ACOs would be another tremendous achievement to add to the legacy of Dr. Berwick.