S

Expanded Coverage through the Affordable

Care Act: What it Means to You and Your

Business

Integra Users SeminarJanuary 23, 2014

Leigh Davitian, JDBrad Kile, PhD

Disclosures

Brad Kile is an independent consultant and has no financial interest or relationships to disclose.

Leigh Davitian is an independent consultant and has no financial interest or relationships to disclose.

Learning Objectives

List the main implications of the Affordable Care Act (ACA) on health professionals and the patient they serve.

Compare current reimbursement models with new financial incentives for providers under the ACA.

Assess new opportunities presented by the ACA for pharmacists to diversify and expand the services provided to beneficiaries

Explain how the new Health Insurance Exchanges (HIE) impact the demand for medications.

Identify how the Centers for Medicare and Medicaid Services considers the differences between Drug Regimen Review (DRR), Medication Therapy Management (MTM), and Comprehensive Medication Review (CMR) for individuals residing in long-term care settings

Identify the impact on demand for health care services as a result of Medicaid expansion and the availability of coverage through health insurance exchanges.

Presentation Outline

Affordable Care Act Implementation What is Happening Now and Big Picture Timeline and Benchmarks

New Payment Models ACA Provisions Payment for Medications and Medication Reviews

Expanded Coverage Under the ACA Health Insurance Exchanges Medicaid Expansion Key Policies

2014 Federal Agenda

Q & A

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Affordable Care Act Implementation

What is Happening Now

Major work must be done to handle monumental shift in coverage and eligibilityCoverage Health Insurance Exchanges Target is 30 million currently lacking coverage

Eligibility Medicaid extends to 133% federal poverty level Target is 17 million currently not eligible

ACA IMPLEMENTATION

2010-13 2014 2015-2020

Regulate Coverage Restructure

Industry Expansion Care Delivery

- Insurance - Individual - Quality

Reform Mandate ties to Payment

Big Picture on ACA

Expanded coverage through Health Insurance Exchanges and Medicaid Expansion

Impact on Employers

Impact on Individuals

Impact on Health Providers Program Integrity Adapting to Change Payment Models

LINKING CARE ACROSS SETTINGS TYING PAYMENT TO QUALITY

Enforcement Efforts under ACA

Compliance Programs

For over 14 years, the Office of Inspector General (OIG) has been encouraging Medicare and Medicaid providers to “adopt voluntary” compliance programs 

Affordable Care Act (ACA), compliance programs are no longer voluntary for Medicare and Medicaid providers

Specifically, Section 6401 of ACA requires healthcare providers to establish compliance and ethics programs that contain certain “core elements” as a condition of their participation in the federal healthcare programs

 To date, HHS has not defined the “core elements” but should not deter providers from implementing a workable, organic compliance program For now – show a good faith effort

Mandated Compliance Program

ALL Medicare providers MUST have comprehensive compliance program in place by March 23, 2013… 10 months ago!

Vague Elements Identified

Develop and distribution of written policies, procedures and standards of conduct

Designate a chief compliance officer in charge of operating the program

Implement regular education and training program for all “germane” employees

Develop an internal audit system to identify problem areas

Develop a system to report deficiencies and problem areas

Develop a process where employees can come forward without fear of retaliation

Develop a means to quickly remedy problems in a systematic, transparent way

Some Core Elements

Develop Written Policies

Looks like a code of ethics or standards of conduct

Similar to a “mantra” that all good business’ should put into place

Best practices for one’s own company Hiring good, quality employees remains important Criminal background checks especially with those in

middle/higher management

Compliance Officer

Select An Appropriate Compliance Officer

• The designation of a chief compliance officer and other appropriate bodies should a be full-time, longer term employee(s) that understand the business OR has served in this capacity in other businesses/organizations

• Many companies use their HR or office manager as designated officer• Caveat: Be sure officer has a keen understanding for all

aspects of the business• Choose wisely!!!

Compliance Officers Duties

• Compliance Officer SHOULD be very familiar with:• All pertinent CMS regulations governing Medicare providers

conditions of participation and regulations on a state and federal level

• Coordination of Benefits• Primary insurances role• Secondary insurances role• Private payors

• False Claims Act• Anti-kickback regulations• HIPAA regulations• ACA provisions!!

TrainingRegularly review and update training programs for ALL employees who“touch” Medicare billing, coding, claims, etc

Test employees’ understanding of training topics

Maintain documentation to show which employees received training

Make sure the Board of Directors receive training Starts at the top!

Attend conferences and webinars, subscribe to publications and OIG’s email list

Monitor OIG’s website and other government resources

Some Core Elements

Some Core Elements

Lines of CommunicationHave open lines of communication between you and employees

Maintain an anonymous “ reporting method” to report issues

Retaliation is a serious for not-reporting Enforce a non-retaliation policy for employees who

report potential problems

Use surveys or other tools to get feedback on training and on the compliance program

Use newsletters or internal websites to maintain visibility with employees

Some Core Elements

Internal AuditingCreate an audit plan and re-evaluate it regularly

Identify your organization’s risk areas

Perform proactive reviews in regards to coding, billing, contracting, business associates

Identify REAL value added services that promote quality of care to customers and their end users

Create corrective action plans to fix the problem

Contracting Trends

• How long has your contract been in place?

• When did you last review your contracts?

• When did you last amend your contract?

• Do you even know where your contracts are stored?

• Are they standard template contracts?

• Are they different and customized for each customer?

• Did legal counsel write the contracts?

• Did legal counsel at least review the contracts?

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Contract Due Diligence:Know the Other Party

• Do thorough due diligence

• Have you done business with them before?• Strengths• Weaknesses• Suspicions activities

• Identify any Medicare exclusions

• Have they been in business under another name before?

• Understand your customers current financial position

• Understand your customers residents/beneficiaries current clinical needs

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Contract Due DiligenceClearly Define Services

Set clear expectations for both sides Detailed provisions Short is NOT sweet

Be thorough with your language Entire agreement in single document No side emails or discussions No “hand-shakes” No napkin provisions

Perform services only in agreement Side services can cause conflicts and misunderstandings Could lead to heighten suspicion

Don’t start services until the agreement is fully executed

Amendments need to be IN WRITING

In a Nutshell …

A compliance program must be “effective in detecting and preventing criminal, civil, and administrative violations” and “in promoting quality of care” within your business and as it pertains to Medicare, Medicaid and other government payor programs …

Audits and Investigations: How do you Respond?

Audits

Fact Pattern:

You are a health care provider and on a random Monday a man enters your place of business and introduces himself. He hands your receptionist an “official” piece of paper and insists it be delivered to the person in charge. Appears to be legal documents.

What should the receptionist do?

Who Entered your POB?

• Who is it?• Important to identify what organization person is representing• Should show identification

• Private Organizations under Contract with CMS• Program Safeguard Contractors • Recovery Audit Contractors• Zone Program Integrity Contractors• Medicare Carriers

• Federal Law Enforcement:• HHS-OIG• FBI• DOD• IRS• FDA

What Type of Document?

What type of document is being served/delivered?

• HHS-OIG Subpoena

• Search Warrant

• Request for general documentation

• Request for employee files

• Request for billing or coding information

• Request for patient information

Protocol in Place

• Do all employees know how to respond to such an occurrence?

• Does your employer have a protocol in place?• Covered in the companies compliance program• Written policy distributed to all employees

• Phone tree Owner/Chief Executive Officer Office Manager Compliance Officer General Counsel

• Do you have rights NOT to respond?

In a Nutshell:Protocol in Place

Point of contact person Employee in authority Knows your business operations

Want to limit amount of persons interacting with law enforcement or agency

Want to show “deference” to the process but privileges are in place to protect employees Sixth Amendment – Right to Counsel

Government has a right to talk to your employees NEVER tell employees to NOT talk or interact

Want to put policies in place to control the situation

Can One be Proactive in this “Complicated”

Environment?

Provider Status: Reality or Fiction

Question:

Why are Pharmacists NOT Bona Fide Health care providers?

Why Pharmacist Profession DID NOT want to be Bona Fide Providers

Lack of confidence to consultant “patients”

Exposure to malpractice Liability for improper information shared with “patient”

Malpractice insurance costs

Lack of time to consultant “patients”

Lack of ability to dispense volume of inventory if time is needed to consult Profession attached to product NOT professional

services

Lack of ability to meet financial demands

That was then; This is NOW

Role of pharmacists has changed over years Academically Clinically

Medication management Patient consultations

Mandated in select health care settings OBRA ’87 Diabetes Education Immunization providers Medication Therapy Management under Part D

So – why do we still not have provider status?

Lack of Status Runs Deep

Understanding the evolved role of pharmacists Legislators Regulators Payors Industry participants

Not merely an intermediary between vendor and consumer

Pennsylvania Supreme Court Case

Lack of Status Runs Deep

Medicare trust fund being threatened by insolvency “Ever-shrinking” pie

Allowing for compensation in a “coster not a saver” Political battle: New spending versus cuts

Ancillary health care groups threatened by inclusion

PHARMACY MUST BECOME and STAY UNITED Remain vigilant, tenacious and persevere

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Expanded Coverage Under the ACA

Health Insurance Exchanges

Health Insurance Exchanges (Marketplaces) Virtual insurance marketplaces for individuals and

employers to shop for coverage Distributors of health care, not deliverers Commercial insurers will manage care within

federal/state requirements Facilitate support/subsidies for individuals based

on need

Health Insurance Exchanges

What has to be covered? Actuarial equivalent calculated for each state Essential Health Benefits

Prescription drugs Ambulatory patient services Emergency services Hospitalization Maternity and newborn care Mental and behavioral health Rehab and Lab services Preventive / wellness care Pediatric care

Health Insurance Exchanges

HIE plan options tiered as “precious metals” Actuarial Value

90%+ Platinum

80%+ Gold

70%+ Silver

60%+ Bronze

HIE – Facilitating Subsidies

Support provided via HIEs, consumer assistance “Navigators” Help determine eligibility for financial assistance

HEIs required to tell consumers if they are eligible for coverage through state Medicaid or CHIP programs

Help for those with incomes between 100% - 400% of FPL Reduced cost sharing < 250%; lower deductibles and copays

Premium tax credits – refundable and advanceable at time of purchase through HIE

Insurance Reform

Incentives for Insurers

Increased demand

Diversity of insurance pools

Financial incentives for covering those with pre-existing conditions

Tighter Regulation of Insurers Premiums can vary only based on: age, tobacco use, family size, and

geography

Medical Loss Ratio – must spend at least 80% of premiums on direct care

Health Insurance Exchanges

Health Insurance Exchanges Virtual insurance marketplaces for individuals and

employers to shop for coverage Distributors of health care, not deliverers Commercial insurers will manage care within

federal/state requirements Facilitate support/subsidies for individuals based on

need

Impact on Businesses

Penalties for Not Providing Affordable Coverage

Small businesses <50 employees NOT required to offer coverage

Businesses >50 employees will pay a penalty $2,000 per employee (excluding the first 30

employees) if they do not offer coverage for employees who average 30 or more hours per week

No penalty for part-time employees

Health Insurance Exchanges

Impact on providers Payment

Care delivery

Competition

Consolidation of contracts

Medicaid in transition

60 million Americans covered by Medicaid (1 in 5)

ACA expands eligibility in 2014; will lead to approximately 16 million more individuals in Medicaid

All states operate some Medicaid Managed Care (MMC), except Alaska, New Hampshire and Wyoming

65% covered by MMC, but payments account for only 20% of Medicaid spend – due to exclusion of high-cost populations

Medicaid in transition

States moving aggressively to place high-cost population into MMC: disabled, elderly, nursing home residents, dual eligible, mental heath

Motivation of States Improve care delivery and payment systems Focus on high-cost/high needs Budget pressures Medicaid expansion under ACA Federal funding incentives:

“Person-centered systems of care” Medicaid “health homes” Demos on integration for dual eligibles

Medicaid Expansion

Targets those individuals at or below 133% of federal poverty level

Federal government will pay 100% of the cost for expansion for 2014, 2015, 2016

Federal share tiers down to 90% for 2020 State participation varies Help for those “left behind’ in states that do

not expand eligibility

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New Payment Models

New Reimbursement MODELS

• Accountable Care Organizations

• Bundled Payment• Hospital Readmissions• Value Based Purchasing

Revisiting the Key Concepts

Typing Payment to Quality

Linking Care Across Settings

Beyond ACOs, these concepts are central to: Part B Reform (replacing the SGR) Bundled Payments Value-based Purchasing

Population Health Management

Evolution of PHM in non-government programs

PHM and the Affordable Care Act

Key Concepts: Typing Payment to Quality Linking Care Across Settings

ACO Basics

ACO: Controlling entity and a related set of providers

that agree jointly to be held accountable for the cost and quality of care delivered to a defined patient population

over time and across all care settings.

Payment Incentives to

Contain Cost and Improve Care

Quality Care Achieved through

Performance Measures

Voluntary Provider

Participation Beneficiaries Assigned, not

Enrolled Local Provider Accountability for Quality and

Efficiency

ACO Incentives and Implications

Coverage

ACOs have financial incentives to focus on therapy selection and adherence as

tools to avoid more costly services. Implications: Increased utilization of

services/products aimed at managing chronic diseases and those with data to

support outcomes.

Access

Value proposition and accessibility are key for any provider seeking access

to ACO patients.Implications: Providers must

communicate value of products/services and understand conditions ACOs

emphasize.

Providers/ACOs

Value through cost-effective care.Cost containment through outcomes-based decisions.

Implications: ACOs driven to risk-based relationships with providers

Consumers

Emphasis on efficiency with less resources impacts customer access to

a provider’s products/services.Implications: Incentives alter utilization.

ACOs: Structural Distinctions from HMOs

Shifts Accountability for Care from Insurers to Providers- Care coordination and financial management at point of care

Beneficiary Participation is “invisible”- Beneficiaries may not be notified of ACO assignment and not required to receive services within the ACO

Flexible Provider Participation- Different payment models may be used: risk-based (bundled payments, full/partial capitation) and fee-for-service

Medicare ACOs

Medicare Shared Savings Program Pioneer ACO Model

Minimum Number of Beneficiaries

5,000 15,000; 5,000 for rural ACOs

Upside/Downside Risk

Track 1: Upside risk only

Track 2: Upside and downside throughout participation

Upside and downside risk

Payment ModelFee-for-service (FFS) + Shared Savings FFS + Shared Savings with transition to

population-based payment

Shared Savings/Losses Potential

Track 1: 50% max shared savings potential; no shared losses

Track 2: 60% max shared savings potential; 40-60% max shared losses based on quality score

Increased percentage of shared savings and losses

Beneficiary Assignment

Quarterly preliminary prospective assignment; annual final retrospective reconciliation

Choice of prospective or retrospective alignment

Medicare ACOs: Quality Measures

MSSP and Pioneer use the same quality measures and MUST MEET QUALITY TARGETS before they are eligible for shared savings.

33 Quality Measures across 4 Domains

1. Patient/caregiver experience (7 measures)

2. Preventive health (8 measures)

3. At-risk population (12 measures)

4. Care coordination (6 measures)

No Medicare ACOs

AK

HI

CA (23)

AZ (8)

NV (3)

OR(2)

MT(1) MN

(5)

NE(2)

SD(1)

ND(1)

ID(1)

WY(1)

OK(2)

KS(1)

CO (2)

UT(1)

TX (17)

NM (3)

SC (4)

FL (32)

GA (13)

AL(2)

MS (3)

LA(2)

AR(2)

MO(4)

IA (7)

VA(7)

NC (8)TN (8)

IN (10)

KY (8)

IL (13)

MI (10)

WI (9)

PA (6)

NY (19)

WV(1)

VT (4)

ME (4)

RI-2

DE - 1MD - 10

NJ

MANH

WA(2)

OH(8)

D.C. - 3

Both MSSP and Pioneer ACOs

MSSP ACOs

8

18

NJ -10

Source: CMS Medicare Shared Savings Program website: http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/index.html?redirect=/sharedsavingsprogram/.

CT- 10

States with Medicare ACOs

PR

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Medicare ACOs by County

CMS Resources

Key Dates for 2014

January 1, 2014, 123 new ACOS provide services to 1.5 million more Medicare beneficiaries >half are physician-led and serve fewer than 10,000 beneficiaries 1 in 5 ACOs include community health centers, rural health

clinics, and critical access hospitals that serve low-income and rural communities.

Milestone: 360 ACOs have been established, serving over 5.3 million Americans with Medicare

Summer of 2014, opportunities announced for new ACOs to begin January 2015.

Commercial Market Implications

# 1 Entities currently running Medicare ACOs are re-structuring their care models for non-Medicare patients.

Implication: ACO influence spans well beyond Medicare

# 2 Commercial payers partnering with providers to form and support ACOs across the country

Implication: Commercial players engaging opportunities

# 3 Commercial ACOs will use multiple models Providers with access to ACOs now will have distinct

advantage as ACOs spread

Bundled Payments

Affordable Care Act Medicare: By 1/1/13 national, voluntary for 8 patient conditions Medicaid: By 10/1/12 demonstration program in up to 8 states NOT IMPLEMENTED (YET)

Happening Now

Testing 4 models through CMS Innovation Center Model 1: Retrospective Acute Care Hospital Stay Only Model 2: Retrospective Acute Care Hospital Stay plus Post-

Acute Care Model 3: Retrospective Post-Acute Care Only Model 4: Prospective Acute Care Hospital Stay Only

Bundled Payments

• January 2013, CMS announced the 450+ health care organizations selected to participate in the Bundled Payments for Care Improvement (BPCI) initiative.

• Four models tested • Organizations choose up to 48 clinical episodes of

care to test.

• Organizations enter into payment arrangements that include financial and performance accountability for episodes of care.

Innovation.cms.gov/initiatives/Bundled-Payments/

Hospital Readmissions

Hospital Readmissions Reduction Program

Adjusts hospital payments based on the $ value of each hospital’s % of potentially preventable Medicare readmissions

Started Oct 1, 2012: three conditions: heart failure, heart attack and pneumonia

Oct 1, 2015: COPD, coronary artery bypass graft, percutaneous transluminal coronary angioplasty, vascular surgery and others as determined by HHS

HHS calculates and make publicly available information on all patient hospital readmission rates

Hospital Value Based Purchasing

For discharges occurring on or after Oct 1, 2012, hospital are now measured

Two Domains: Clinical Process of Care: comprised of 12 clinical process measures Patient Experience of Care: Hospital Consumer Assessment of Healthcare Providers

and Systems (HCAHPS)

For 2014, measures expanded to include: 3 Mortality outcome measures; 8 hospital acquired Condition measures; 2 Agency

for Healthcare Research and Quality (AHRQ) composite measures

ACA calls for VBP in nursing homes, hospice and ambulatory surgical centers

Short Cycle Dispensing

14-day-or-less dispensing requirement for Part D enrollees residing in LTC facility began January 1, 2013

Brand-name oral solid medications only

Definition of “dispensing fee” modified to include costs associated with the acquisition and maintenance of technology to maintain reasonable pharmacy costs

Use of automated dispensing is not mandated

Short Cycle Dispensing

The facility selects the dispensing methodology or methodologies to be used in concert with their contracted LTC pharmacy

The Part D sponsor cannot choose or mandate any particular dispensing methodology

Uniform with respect to each LTC facility and will apply to all Part D sponsors and pharmacies dispensing to enrollees in that facility

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Medication Management

LTC and Medication Management

Medication Therapy Choice

Prescriber

Formularies and Utilization

Management Tools:

Part D, Medicaid, Pharmacy, Facility

Monthly DRR by Consultant

Pharmacists

Medication Therapy

Management by ? for Part D Surveyor

Oversight for Compliance

Medication Reviews and utilization

Drug Regimen Review Antipsychotic Medication Use Independence of Consultant

Pharmacists Potential Conflicts of Interest Effectiveness Impact on Patients Cost to government

Difference between MTM and DRR

January 2012 CMS Memo:

“We believe that there is potential overlap in these reviews that could possibly result in conflicting reviews and recommendations for prescribers and facility staff, as well as excess costs in the health care sector.”

“We believe that better care coordination and cost efficiencies would result from arrangements that include the LTC consultant pharmacist in the conduct of Part D MTM services for beneficiaries in the long term care setting.”

LTC and Medication Management

Three Major Trends

Integration of Reviews DRR is facility requirement; MTM and CMR are Part D

requirements.

Conflicts of Interest (potential or real)

Reviews influenced by financial implications of medications? Should reviewers be independent?

Class-Specific Scrutiny Government focus on different classes of medications over time. Currently: antipsychotic medications and hydrocodone products.

Reimbursement for Pharmaceuticals

Many polices with a single goal…

Replacing the “fundamentally flawed nature of AWP-based reimbursement” and the “inflated published prices” that cause the government to “pay too much for certain drugs” - Office of the Inspector General

Reimbursement

Medicaid – Average Manufacturer Price (AMP) ACA modified the Federal Upper Limit (FUL) for Medicaid multiple

source drugs

Effective October 1, 2010, FUL as no less than 175 percent of the weighted average (determined on the basis of utilization) of the most recently reported monthly average AMP

CMS issuing draft AMP-based FUL reimbursement files for review and comment only for multiple source drugs weighted average of monthly AMPs in a FUL group not posting monthly AMPs for individual drugs

Average Manufacturer Price

Applies to Medicaid Reimbursement, Broader Implications 2012 Proposed Rule CMS proposes to define “retail community pharmacy” for

manufacturer AMP calculations. “an independent pharmacy, a chain pharmacy, a supermarket

pharmacy, and a mass merchandiser pharmacy that is licensed as a pharmacy by the State and that dispenses medications to the general public at retail prices.”

Excludes from AMP sales to PBMs, LTC pharmacies, mail order pharmacies, and others.

CMS notice in Fall 2013, says Final Rule will be issued in January 2014

Reimbursement

Medicaid – developing alternate benchmarks CMS contracts with Myers & Stauffer, LC, to perform surveys

Part I - Retail Community Pharmacy Consumer Prices National Average Retail Prices (NARP) for Medicaid Covered Outpatient Drugs 

PART II - Drug Acquisition Costs Paid By Retail Community Pharmacies

National Drug Acquisition Cost (NADAC)

Reimbursement

Dispensing Fees If reimbursement is actual acquisition cost, what would

the dispensing fee need to be to providers?

What is the cost to dispense?

What are the differences for different setting like LTC?

Beyond Medicare and Medicaid, what are the implications for other payors?

Reimbursement

Medicare Part B – Average Sales Price (ASP)

3-6 month lag time is problematic OIG Feb 2013 report calls for

competitive bidding of DME infused medications

CAP option for physicians is not an option

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2014 Federal Agenda

Part B Sustainable Growth Rate

House Energy and Commerce Committee bill Replaces SGR with a system that incentivizes quality and

efficiency starting in 2019. 5 years of stable Medicare payments starting next year, with

reimbursements growing 0.5% for each year between then and 2018.

Starting in 2019, the "Update Incentive Program" would place at risk a certain amount of fee-for-service payments and base those reimbursements on quality measures.

Controlled Substances

Federal Action“Food and Drug Administration Safety and Innovation Act”

Draft provision NOT in the final bill was reclassification of all hydrocodone-containing products to Schedule II

Final bill requires FDA hold public meeting January, 2013 Panel recommends changing classification

DEA Proposed Rule

Proposed Dec. 2012; comments due Feb. 19, 2013.

Proposes to allow authorized manufacturers, distributors, reverse distributors, and retail pharmacies to voluntarily administer mail-back programs and maintain collection receptacles.

Expand the authority of authorized retail pharmacies to voluntarily maintain collection receptacles at long term care facilities (LTCF).

No manufacturer, distributor, reverse distributor, or retail pharmacy is required to be a collector under the proposal.

DEA Proposed Rule

Key provisions related to LTC include: LTCFs would be permitted to dispose of controlled

substances on behalf of an ultimate user who resides or has resided at the LTCF.

LTCFs would be required to transfer controlled substances in Schedules II through V into collection receptacles immediately, but no longer than three business days after it is determined that the ultimate user no longer needs or wants, or should discontinue use of the controlled substance.

If the LTCF does not have access to an on-site collection receptacle, they are not otherwise permitted to dispose of a controlled substance on behalf of an ultimate user.

Federal Oversight

FDA of Drug Quality and Security Act:

Compounding response to the meningitis outbreak

Track and Trace administered by FDA to track a drug from its

origination, through the manufacturing process, to the point of sale

DMEPOS Competitive Bidding

Round 2 Starts July 1 8 product categories 91 Competitive Bid Areas 13,126 contracts awarded to 799 suppliers 45% savings

National Diabetic Testing Supplies 52 locations for mail-order/home delivery Retail payment to = mail-order 72% savings

Round 1 Recompete Underway

Unused Medications in LTC

Current Reality

No uniform approach due to lack of clarity on rules

The Drug Enforcement Administration (DEA)

Environmental Protection Agency (EPA)

Centers for Medicare and Medicaid Services (CMS)

Food and Drug Administration (FDA)

DEA Proposed Rule

Proposed Dec. 2012; No action after.

Proposes to allow authorized manufacturers, distributors, reverse distributors, and retail pharmacies to voluntarily administer mail-back programs and maintain collection receptacles.

Expand the authority of authorized retail pharmacies to voluntarily maintain collection receptacles at long term care facilities (LTCF).

No manufacturer, distributor, reverse distributor, or retail pharmacy is required to be a collector under the proposal.

DEA Proposed Rule

Key provisions related to LTC include: LTCFs would be permitted to dispose of controlled

substances on behalf of an ultimate user who resides or has resided at the LTCF.

LTCFs required to transfer Schedules II through V into collection receptacles immediately, but no longer than three business days after it is determined that the ultimate user no longer needs or wants, or should discontinue use of the controlled substance.

If the LTCF does not have access to an on-site collection receptacle, they are not otherwise permitted to dispose of a controlled substance on behalf of an ultimate user.

Controlled Substances

Reclassification of all hydrocodone-containing products to Schedule II

FDA hold public meeting Panel recommends changing classification

Legislation introduced in Congress

Change not definite, but could come at any time after Rulemaking process

Commission on LTC Recommendations

Report to Congress – Sept 30, 2013 Framework for Reform

SERVICE DELIVERY A more responsive, integrated, person-centered, and fiscally sustainable

LTSS delivery system that ensures people can access quality services in settings they choose.

FINANCE A sustainable balance of public and private financing for long-term

services and supports (LTSS) that enables individuals with functional limitations to remain in the workforce or in appropriate care settings of their choice.

Part B Drugs and Biologics

Average Sales Price (ASP) + 6% 2011 and 2012 legislative threat - reduce to ASP + 3% June 2013 House Hearing, discussion looks at reform

H.R. 800, would exclude customary prompt pay discounts extended by manufacturers to wholesalers from ASP calculation.

H.R. 1428, the Comprehensive Immunosuppressive Drug Coverage for Kidney Transplant Patients Act – ESRD.

H.R. 1416, the Cancer Patient Protection Act, would exempt Medicare Part B drug payments from sequestration.

ACA: Major Shift

LINKING CARE ACROSS SETTINGS Breaking down care silos through payment incentives

Rehospitalizations

Bundled Payments Program

Accountable Care Organizations (ACOs)

ACA: Major Shift

TYING PAYMENT TO QUALITY Sweeping change in approach to payments

Quality outcomes replace utilization as payment drivers

Value-based Purchasing

Bundled Payments Program

Accountable Care Organizations (ACOs)

Existing Quality Programs Minimum Data Set 3.0 Nursing Home Compare Data

Tying it All Together

Expanded coverage leads to increase in demand for health services

Know the payment incentives to know your customers

Understand who is who when it comes to medication reviews

Prepare for changes from Federal oversight

Thank You!

Leigh Davitiansldavitian@dumbartonassociates.com

Brad Kile, PhDbkile@dumbartonassociates.com