Fundamentals of Healthcare Reform
Walter ColemanWV/PA HFMASeptember 25, 2014
How about efficiency?
Waste in the System
Industry Tipping Point
6
Rev
enue
Time
• How do local market conditions impact timing considerations?• Can market-changing events create an urgent paradigm shift?• What is my step-change business model risk?• Do I have the financial tools to adequately analyze relevant states?
Healthcare Performance Program Umbrella
Value Based Purchasing
Readmission Reduction
Program
Hospital A
cquired
Conditions
Bundled Payment
Hospital Inpatient Q
uality
Reporting Program
ACO
Medicare Shared Savings
Program
VALUE BASED PURCHASINGMandatory Element of Reform
Value Based Purchasing Overview
• MANDATORY – we have no choice
VBP Example $33,333,333 Medicare Reimbursement
Amount mandated to pay for participation
VBP Example $33,333,333 Medicare Reimbursement
VBP Example $33,333,333 Medicare Reimbursement
$300,000
VBP Example $33,333,333 Medicare Reimbursement
Amount mandated to pay for participation
VBP Example $33,333,333 Medicare Reimbursement
VBP Example $33,333,333 Medicare Reimbursement
($200,000)
Value Based Purchasing• Outcomes = Income
• Mandatory Pay for Performance Program– 3,500 hospitals are included in this program across the country
• Reimbursement Determine Two Ways:– Achievement
• How we compare to National Top Decile (350 Hospitals)
– Improvement• How we measure against ourselves• Did we do better than a previously measured baseline period
Value Based Purchasing• Percent of Medicare Reimbursement at Risk
• FY 2013 – 1.00%• FY 2014 – 1.25%• FY 2015 – 1.50%• FY 2016 – 1.75%• FY 2017 – 2.00%• FY 2018 – 2.00%• FY 2019 – 2.00%
• FY 20xx – refers to the Federal Fiscal Year (Oct. 1 – Sep. 30) when DRG payments will be affected
NEW MEASURESValue Based Purchasing
VBP FY 2016 – New Measures• Patient Experience
– No Change – Same HCAHPS Measures
• Core Measures– 5 Dropped; 1 New
• Outcomes– 3 New Measures
• Efficiency– No Change
VBP FY 2016 – New Measures• Patient Experience
– No Change – Same HCAHPS Measures
• Core Measures– 5 Dropped; 1 New
• Outcomes– 3 New Measures
• Efficiency– No Change
VBP – FY 2016 – Patient Experience• HCAHPS
– Hospital Consumer Assessment of Healthcare Providers Survey
– An engagement survey CMS has mandated each hospital give to every discharged inpatient
– Consists of 27 questions that lead to the 8 categories assessed for VBP
– Patients score each question on scale of 4
– For answers to count, patients must give hospitals a score of 4 or “Always”
VBP FY 2016 – Patient Experience
• Communication with Nurses
• Communication with Doctors
• Responsiveness of Hospital Staff
• Pain Management
• Communication about Medicines
• Cleanliness and Quietness of Hospital
• Discharge Information
• Overall Rating of Hospital
VBP FY 2016 – New Measures• Patient Experience
– No Change – Same HCAHPS Measures
• Core Measures– 5 Dropped; 1 New
• Outcomes– 3 New Measures
• Efficiency– No Change
VBP FY 2015 – Core Measures
• AMI-7a• AMI-8a• HF-1• PN-3b• PN-6• SCIP-Inf-1
• SCIP-Inf-2• SCIP-Inf-3• SCIP-Inf-4• SCIP-Inf-9• SCIP-Card-2• SCIP-VTE-2
VBP FY 2016 – Core Measures
• AMI-7a
• PN-6
• SCIP-Inf-2
• SCIP-Inf-3
• SCIP-Inf-9
• SCIP-Card-2
• SCIP-VTE-2
• IMM-2
Note: IMM-2 Performance Period is only 6 MONTHS (Two 3 Month Periods)January 1, 2014 – March 31, 2014 AND October 1, 2014 – December 31, 2014
VBP FY 2016 – Core Measures
Measure ID Benchmark
AMI-7a 100%
IMM-2 98.875%
PN-6 100%
SCIP-Inf-2 100%
SCIP-Inf-3 100%
SCIP-Inf-9 100%
SCIP-Card-2 100%
SCIP-VTE-2 100%
VBP FY 2016 – Core Measures
• AMI-7a
• PN-6
• SCIP-Inf-2
• SCIP-Inf-3
• SCIP-Inf-9
• SCIP-Card-2
• SCIP-VTE-2
• IMM-2
VBP FY 2017 – Clinical Care: Process
• AMI-7a
• IMM-2
• PC-01
PC-01 = Elective Delivery Prior to 39 Completed Weeks Gestation
VBP FY 2016 – New Measures• Patient Experience
– No Change – Same HCAHPS Measures
• Core Measures– 5 Dropped; 1 New
• Outcomes– 3 New Measures
• Efficiency– No Change
VBP FY 2015 – Outcomes• 30 Day Mortality – AMI
• 30 Day Mortality – HF
• 30 Day Mortality – PN
• AHRQ – PSI-90
• CLABSI
VBP FY 2016 – Outcomes• 30 Day Mortality – AMI
• 30 Day Mortality – HF
• 30 Day Mortality – PN
• AHRQ – PSI-90
• CLABSI
• CAUTI
• SSI – Colon
• SSI – Abdominal Hysterectomy
VBP FY 2016 – Outcomes
Measure ID Benchmark
CAUTI 0.000
CLABSI 0.000
Surgical Site Infection
Colon 0.000
Abdominal Hysterectomy 0.000
VBP FY 2016 – OutcomesOutcomes• 30 Day Mortality – AMI• 30 Day Mortality – HF• 30 Day Mortality – PN• AHRQ – PSI-90• CLABSI• CAUTI• SSI-Colon• SSI-Abdominal Hyster.
VBP FY 2017 – Clinical Care and SafetyClinical Care- Outcomes• 30 Day Mortality – AMI• 30 Day Mortality – HF• 30 Day Mortality – PN• AHRQ – PSI-90• CLABSI• CAUTI• SSI-Colon• SSI-Abdominal Hyster.
Safety
• MRSA• C. Diff
Outcomes – 30 Day Mortality• Currently in 3 Performance Periods
• FY 2016 ended June 30, 2014
• FY 2019 began July 1, 2014
• 30 Day Mortality Measures
– Assess deaths: AMI, HF, and PN that occur within 30 days after admission; which, depending on the length of stay, may occur post-discharge….
CMS 30 Day Risk-Standardized Mortality Rate Calculation
Facility Predicted Deaths
Facility Expected DeathsX
Measure (AMI, HF, PN) National Crude Rate
=
VBP FY 2016 – New Measures• Patient Experience
– No Change – Same HCAHPS Measures
• Core Measures– 5 Dropped; 1 New
• Outcomes– 3 New Measures
• Efficiency– No Change
VBP FY 2016 - Efficiency• Medicare Spend Per Beneficiary (MSPB)
– Captures total Medicare Spending Per Beneficiary relative to a hospital stay, bundling hospital sources (Part A) with post acute care (Part B)
– Bundles the cost of care delivered to a beneficiary for an episode across the continuum of care:
• 3 Days Prior
• Hospital Inpatient Stay
• 30 Days post Discharge
PROPOSED MSPB Measures
• Additional Efficiency Measures proposed to be added
• Risk Adjusted similarly to MSPB• Proposed to facilitate alignment with the Physician
Value Based Payment Modifier program• Includes Part A and B and 3 days prior to admission
and 30 days post discharge41
Medical Surgical
Kidney/Urinary Tract Infection
Hip replacement/revision
Cellulitis Knee replacement/revision
Gastrointestinal hemorrhage
Lumbar spine fusion/refusion
SOURCE: May 1, 2014 Federal Register
VBP Shifting of Domain Weights
FY 2013 FY 2014 FY 2015 FY 2016
• Core Measures
• Patient Experience • Efficiency (MSPB)
• Outcomes
VBP – FY13 Domain WeightsPerformance Period: July 1, 2011 – March 31, 2012Reimbursement Period: October 1, 2012 – September 30, 2013
Core Measures = 70%
VBP – FY14 Domain WeightsPerformance Period: April 1, 2012 – December 31, 2012Reimbursement Period: October 1, 2013 – September 30, 2014
Core Measures = 45%Outcomes = 25%
VBP – FY15 Domain WeightsPerformance Period: January 1, 2013 – December 31, 2013Reimbursement Period: October 1, 2014 – September 30, 2015
HCAHPS = 30%
Outcomes = 30% MSPB = 20%One Measure!!
Core Measures = 20%
VBP – FY16 Domain WeightsPerformance Period: January 1, 2014 – December 31, 2014Reimbursement Period: October 1, 2015 – September 30, 2016
HCAHPS = 25%
Outcomes = 40%
MSPB = 25%
Core Measures = 10%
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HCAHPS = 25%
Safety = 20%
MSPB = 25%
Clinical Care - Process = 5%
Clinical Care - Outcomes = 25%
VBP – FY17 Domain WeightsPerformance Period: January 1, 2015 – December 31, 2015Reimbursement Period: October 1, 2016 – September 30, 2017
Crosswalk from FY 16 to FY 17
Measure Prior Domain (FY’16) NQS Domain (FY’17)
Core Measures Clinical Process of Care Clinical Care- Process
HCAHPS Patient Experience of Care Patient & Caregiver Centered Experience of Care/Care Coordination
CAUTI/CLABSI/SSI Outcomes Safety
Mortality – 3 diagnoses Outcomes Clinical Care- Outcomes
PSI- 90 Outcomes Safety
Medicare Spend Per Beneficiary Efficiency Efficiency & Cost Reduction
ANALYZING VALUE BASED PURCHASING PERFORMANCE
Fundamentals of Healthcare Reform
• System was penalized $376,003 in FY’15 VBP Program• Must acknowledge the amount UNEARNED• Of the programs dollars made available:
– System did not capitalize on $6,187,541
Earned Back Unearned Available $$ % Earned
CGH $288,853 $540,406 $829,259 34.83%
$288,853
$0 $829,259 Chesapeake General Performance
VBP FY'13 TOTAL PERFORMANCE
Breakeven Point: $451,333
Earned Back Unearned Available $$ % Earned
System $4,925,357 $6,187,541 $11,112,898 44.32%
$0 $11,112,898Overall Performance
VBP FY'15 TOTAL PERFORMANCE
$4,925,357Breakeven Point: $5,301,360
Facility Bonus / (Penalty) Total Score State Average National Average National ΔFacility A $97,593 42.03 41.81933117 41.70169535 0.325577377
Measure Score
Amount Earned by Measure
Amount Unearned by
Measure
% of Measure Earned
Core Measures
AMI-8a 6 32,712$ 21,808$ 60.00%SCIP-Inf-1 9 49,068$ 5,452$ 90.00%SCIP-Inf-2 7 38,164$ 16,356$ 70.00%SCIP-Inf-3 5 27,260$ 27,260$ 50.00%SCIP-Inf-4 9 49,068$ 5,452$ 90.00%SCIP-Inf-9 5 27,260$ 27,260$ 50.00%HF-1 8 43,616$ 10,904$ 80.00%PN-3b 5 27,260$ 27,260$ 50.00%PN-6 8 43,616$ 10,904$ 80.00%SCIP-Card-2 3 16,356$ 38,164$ 30.00%SCIP-VTE-2 5 27,260$ 27,260$ 50.00%
Core Measures TOTAL 381,643$ 218,077$ 63.64%
HCAHPS
Comm. w/ Nurses 2 17,994$ 71,966$ 20.00%Comm. w/ Doctors 1 8,998$ 80,962$ 10.00%Resp. of Hosp. Staff 2 17,994$ 71,966$ 20.00%Pain Management 2 17,994$ 71,966$ 20.00%Comm. Re: Medicines 1 8,998$ 80,962$ 10.00%Clealiness & Quietness 2 17,994$ 71,966$ 20.00%Discharge Information 3 26,990$ 62,970$ 30.00%Overall Rating 1 8,998$ 80,962$ 10.00%
Consistency Score 17 152,933$ 26,987$ 85.00%
HCAHPS TOTAL 278,896$ 620,704$ 31.00%
Outcomes
AMI 10 179,920$ (0)$ 100.00%HF 3 53,980$ 125,940$ 30.00%PN 8 143,934$ 35,986$ 80.00%AHRQ PSI-90 9 161,928$ 17,992$ 90.00%CLABSI 0 0$ 179,920$ 0.00%
Outcomes TOTAL 539,763$ 359,837$ 60.00%
Efficiency
MSPB 1 59,974$ 539,746$ 10.00%
Efficiency TOTAL 59,974$ 539,746$
Facility TOTAL 1,260,277$ 1,738,363$ 42.03%
Earned Back Unearned Measure Value % Earned
Facility $381,643 $218,077 $599,720 63.64%
$381,643
$0 $599,720
Earned Back Unearned Measure Value % Earned
Facility $278,896 $620,704 $899,600 31.00%
$278,896
$0 $899,600
Core Measures
HCAHPS
Breakeven Point: $232,525
Breakeven Point: $348,788
Earned Back Unearned Measure Value % Earned
Facility $539,763 $359,837 $899,600 60.00%
$539,763
$0 $899,600
Earned Back Unearned Measure Value % Earned
Facility $59,974 $539,746 $599,720 10.00%
$59,974
$0 $599,720
Outcomes
Efficiency
Breakeven Point: $348,788
Breakeven Point: $232,535
READMISSION REDUCTION PROGRAM
Mandatory Element of Reform
Readmission Reduction Program• 9% of Current and Future Medicare Reimbursement at Risk
– 3% penalty of Medicare Reimbursement at risk each program year– Measured Populations 30 days from DISCHARGE
• AMI, HF, PN, COPD, THA & TKA
• August 2014: CABG Added to FY 2017• Performance Periods: 3 Year Rolling Program
– FY’15: July 1, 2010 – June 30, 2013 – 3%– FY’16: July 1, 2011 – June 30, 2014 – 3%– FY’17: July 1, 2012 – June 30, 2015 – 3% – FY’18: July 1, 2013 – June 30, 2016 – 3%– FY’19: July 1, 2014 – June 30, 2017 – 3%
Currently participating in 3 performance periods simultaneously
How are Readmissions Measured?• Scoring Index based at 1.0• Calculate Excess Readmission Ratio
• Excess Readmission Ratio > 1 = BAD• Excess Readmission Ratio < 1 = GOOD
Facility Predicted Value
Facility Expected Value
HOSPITAL ACQUIRED CONDITIONS
Mandatory Element of Reform
Hospital Acquired Conditions (1% at Risk*)• 12 Hospital Acquired Conditions Identified
– Divided in to 2 Domains
• If a hospital is in the BOTTOM QUARTILE (worst performing 25% in the country), it will be penalized a FULL 1% of Medicare Reimbursement
• Penalties will begin FY’15 (beginning October 1, 2014)
*1% After DSH, Uncompensated Care, and IME
Hospital Acquired Conditions: FY 2015
First Domain: PSIsPerformance Period: 7/1/11-6/30/13
Second Domain: CDCPerformance Period: CY 2012 & 2013
Pressure Ulcer Rate CLABSI
Iatrogenic Pneumothorax Rate CAUTI
Central Venous Catheter-Related Bloodstream Infections
Postoperative Hip Fracture
Postoperative Pulmonary Embolism and Deep Vein Thrombosis Rate
Postoperative Sepsis
Postoperative Wound Dehiscence
CLABSI 32.5%
CAUTI 32.5%
Pressure Ulcer 5.0%
Postop. Sepsis 5.0%
HAC Domain Weightings: FY’15
DOMAIN 1: 35% DOMAIN 2: 65%
Hospital Acquired Conditions: FY 2016
First Domain: PSIs25%
Second Domain: CDC75%
Pressure Ulcer Rate CLABSI
Iatrogenic Pneumothorax Rate CAUTI
Central Venous Catheter-Related Bloodstream Infections
SSI Following Colon Surgery (FY 2016)
Postoperative Hip Fracture SSI Following Abdominal Hysterectomy (FY 2016)
Postoperative Pulmonary Embolism and Deep Vein Thrombosis Rate
Postoperative Sepsis
Postoperative Wound Dehiscence
CLABSI 25.0%
CAUTI 25.0%SSI 25.0%
Pressure Ulcer 3.6%
3.6%Postop. Sepsis
HAC Domain Weightings: FY’15
DOMAIN 1: 25% DOMAIN 2: 75%
Hospital Acquired Conditions: FY 2017
First Domain: PSIs25%
Second Domain: CDC75%
Pressure Ulcer Rate CLABSI
Iatrogenic Pneumothorax Rate CAUTI
Central Venous Catheter-Related Bloodstream Infections
SSI Following Colon Surgery (FY 2016)
Postoperative Hip Fracture SSI Following Abdominal Hysterectomy (FY 2016)
Postoperative Pulmonary Embolism and Deep Vein Thrombosis Rate
Methicillin-Resistant Staphylococcus Aureus (MRSA) Bacteremia (FY 2017)
Postoperative Sepsis Clostridium Difficile (FY 2017)
Postoperative Wound Dehiscence
Duplicate Measures
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VBP - Outcomes HACIndividual Measure
CLABSI CLABSICAUTI CAUTISSI - Colon SSI - Colon
SSI - Abdominal Hysterctomy SSI - Abdominal Hysterectomy
AHRQ: PSI-90
Pressure Ulcer Rate Pressure Ulcer Rate
Iatrogenic Pneumothorax Rate Iatrogenic Pneumothorax RatePostoperative Pulmonary Embolism and DVT Rate
Postoperative Pulmonary Embolism and DVT Rate
Accidental Puncture and Laceration Rate
Accidental Puncture and Laceration Rate
VBP - Outcomes HACIndividual Measure
CLABSI CLABSICAUTI CAUTISSI - Colon SSI - Colon
SSI - Abdominal Hysterctomy SSI - Abdominal Hysterectomy
AHRQ: PSI-90
Pressure Ulcer Rate Pressure Ulcer Rate
Iatrogenic Pneumothorax Rate Iatrogenic Pneumothorax RatePostoperative Pulmonary Embolism and DVT Rate
Postoperative Pulmonary Embolism and DVT Rate
Accidental Puncture and Laceration Rate
Accidental Puncture and Laceration Rate
SAMPL IPPS Reimbursement LetterPPS EFFECTIVE 10/1/2014 DRG Weight 1.00
Facility CMI 1.54OPERATING INFORMATION
Federal National Standardized Labor Rate 3,329.57Wage Index 0.8994Labor Rate x Wage Index 2,994.62Federal National Standardized Non-Labor Rate 2,040.71PPS Blended Rate 5,035.33FY 2015 Hospital Readmissions Reduction (HRR) Adjustment Factor 0.9994 5,032.30 ($3.02) RRP ReductionFY 2015 Value-Based Purchasing (VBP) Adjustment Factor 0.994348 5,003.86 ($28.44) VBP Reduction
($31.46) Per DRG Reduction
($31.46) x 1.54
($48.45)VBP & RRP Per DRG Red. CMI Adj
Disproportionate Share Adjustment (Operating) (Empirically Justified Amount 25%) 0.0691 0.02 5,090.43Disproportionate Share Adjustment (Operating) (Uncompensated Care Amount) 507.71 5,598.14Fully Loaded Operating Rate adjusted for CMI 8,346.97
FY 2015 Hospital Acquired Condition (HAC) Adjustment Factor 0.99 8,263.50($83.47)
HAC Per DRG CMI Adjusted
($131.92)Total Per DRG Reduction
Penalties & Your DRG Payment
CURRENT DOLLARS AT RISK
SAMPLE $50,000,000 FACILITY
Mandatory Elements of Reform
Domain Weight At Risk On the Table
Medicare Spend Per Beneficiary 25% 745,471$ 1,562,507$
Outcomes 40% 1,192,753$ 2,500,011$ Patient Experience 25% 745,471$ 1,562,507$ Core Measures 10% 298,188$ 625,003$
TOTAL 100% 2,981,883$ 6,250,028$
VBP FY 2016
VBP FY 2016 – Sample Current $$ at Risk
Domain Weight At Risk On the Table
FY 2016
Medicare Spend Per Beneficiary 25% 745,471$ 1,562,507$ Outcomes 40% 1,192,753$ 2,500,011$ Patient Experience 25% 745,471$ 1,562,507$ Core Measures 10% 298,188$ 625,003$
FY 2017
Outcomes - 30 Day Mortality 25% 851,967$ 1,785,722$ Outcomes - AHRQ 3.75% 127,795$ 267,858$
FY 2018**
Outcomes - 30 Day Mortality 25% 851,967$ 1,785,722$
Outcomes - AHRQ 3.75% 127,795$ 267,858$
FY 2019**
Outcomes - 30 Day Mortality 25% 851,967$ 1,785,722$
TOTAL 5,793,374$ 12,142,911$
VBP Current Dollars At Risk (Active Performance Periods)
VBP – Sample Total Current $$ at Risk
All Reform – Sample Total Current $$ at Risk
Domain On the Table
FY 2016
Value Based Purchasing 6,250,028$ Readmissions COMPLETEHospital Acquired Conditions 1,703,933$ FY 2017
Value Based Purchasing 2,053,581$
Readmissions 5,111,800$ Hospital Acquired Conditions 1,703,933$
FY 2018**
Value Based Purchasing 2,053,581$
Readmissions 5,111,800$
FY 2019**
Value Based Purchasing** 1,785,722$
Readmissions 5,111,800$
TOTAL 30,886,178$
All Active Mandatory Reform
OPPORTUNITIESMandatory Elements of Reform
New NQS Based Domains for FY 2017
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HCAHPS = 25%
Safety = 20%
MSPB = 25%
Clinical Care - Process = 5%
Clinical Care - Outcomes = 25%
50% of VBP is Mortality and MSPB
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Clinical Care - Outcomes = 25%
Opportunities – VBP: Outcomes
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FY14 ∆ FY14 ∆ FY14 ∆Performance 87.40% Performance 83.81% Performance 85.21%
Baseline 89.58% -2.18% Baseline 84.76% -0.95% Baseline 88.94% -3.73%Threshold 88.18% -0.78% Threshold 84.77% -0.96% Threshold 88.61% -3.40%
Benchmark 90.21% -2.81% Benchmark 86.73% -2.92% Benchmark 90.42% -5.21%Score 0 Score 0 Score 0
Improvement Dollar Value Score Improvement Dollar Value Score Improvement Dollar Value Score+1% 13,209$ 1 +1% 13,209$ 1 +1% -$ 0
+1.5% 52,836$ 4 +1.5% 39,627$ 3 +1.5% -$ 0+2.5% 105,673$ 8 +2.5% 105,673$ 8 +2.5% -$ 0+3.5% 132,091$ 10 +3.5% 132,091$ 10 +3.5% 13,209$ 1+4.5% 132,091$ 10 +4.5% 132,091$ 10 +4.5% 79,254$ 6+5.5% 132,091$ 10 +5.5% 132,091$ 10 +5.5% 132,091$ 10+6.5% 132,091$ 10 +6.5% 132,091$ 10 +6.5% 132,091$ 10+7.5% 132,091$ 10 +7.5% 132,091$ 10 +7.5% 132,091$ 10+8.5% 132,091$ 10 +8.5% 132,091$ 10 +8.5% 132,091$ 10
1 2 330 Day Mortality Rate - AMI 30 Day Mortality Rate - HF30 Day Mortality Rate - PN
Top 50th = Δ1 Patient
Top 10th = Δ3 Patient
Top 50th = Δ1 Patient Top 50th = Δ8 Patients
Top 10th = Δ11 PatientsTop 10th = Δ3 Patient
VBP – CMS Proposed Future Measures
• FY 2018 Program (Performance Period: CY 2016)– Patient Experience: Care Transition
• FY 2019 Program (Performance Period: CY 2017)– Surgical Complication: Total Hip and Total Knee Arthroplasty
VBP – Other Possible Metrics to Follow
• Emergency Department Care• Preventative Care
– Pneumonia Vaccine
• Children’s Asthma Care• Stroke Care
– Blood Clot Prevention Care– Preventative Care
FY 19 New Measure• Added THA/TKA for 30 month performance period.
– January 1, 2015-June 30, 2017– Baseline of July 1, 2010-June 30, 2013
• Risk standardized measure for complications after Total Hips and Knees surgeries for up to 90 days post surgery– One of eight complications: AMI, pneumonia, sepsis, SSI, PE, death,
mechanical complication or periprosthetic joint infection/wound infection.– Each has a defined time frame– Each is a ‘Yes’ or ‘No– Risk adjusted for patient age, sex and comorbidities
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SOURCE: August 2014 Proposed Rules Federal Register
Readmissions – Proposed Future Measures
• Percutaneous Coronary Intervention (PCI)
• Stroke
Opportunities – HAC
• SSI Following Colon Surgery (FY’16)
• SSI Following Abdominal Hysterectomy (FY’16)
• MRSA (FY’17)
• C Diff (FY’17)
BPCIBUNDLED PAYMENTS
Description of Models 1 - 4
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Medical Homes
Acute Care Bundling
Acute Care Episode with Post Acute Care Bundling
Post Acute Care Bundling
©2010 Kaufman Hall & American Hospital Association.81
Bundled Payments
Advantages of Participation
• Improved quality of care for patients– Reduced complications, readmissions, and cost
• Improved ability to work with hospitals, physicians, nursing homes, home health, rehab centers, and other providers to improve overall care quality and service
• Potential competitive advantage within market with physicians and post-acute care
• Opportunity to receive payment aligned with these goals and based on outcomes
82
http://innovation.cms.gov/initiatives/bundled-payments/
83
MEDICARE: Cohort 1 COMMERCIAL as of July 2014
Where are the Bundled Payments?
Early Results of BPCI Cohort 2• Tremendous increase in the
number of applications in the most recent open enrollment in April 2014: Nearly Triple!
• Models 2,3,4 were open for enrollment
• Currently in the Phase 1 period which is the non risk, decision making period. Phase 2 is when the Episode Initiator starts to accept risk
Changes In the Cohort 2 Timeline: 7/31/14
Event Original Date Revised Date
Historical Claims & Target Pricing
Late Summer 2014 October 2014
Go/No Go Decision to Participate
November 1, 2014 January 1, 2015
Go Live with Risk January 1, 2015 April 1, 2015
Other significant changes: ADDITION OF EPISODES: You can now add episodes in July
2015 and October 2015: only 1 episode is required for April 1, 2015. Phase 1 ends in October 2015
B-CARE: B-CARE quality data wont be collected until Spring 2015
Option for Delayed Reconciliation: Will offer a 4 quarter timeline for reconciliation.
MD• Home Health• SNF• IRF• Outpt. Rehab
Readmission
Home
$3,207 $10,129 $8,965 $616+ + + = $22,927
x 98%
$22,468
DRG Inpatient and PACS Fee for Service Model
$22,468
Bundled Episodic Model
DRG 470 Total Joint Replacement w/out CCModel 2
Note: any CMI aggregate charges lower than $22,468 can be shared with providers via gain sharing model
Episodic period for model 2: 3 days prior to admission to 90 days post discharge from hospital
BPCI Multiple Bonus Payments: Physicians• 2 opportunities for Physicians to be awarded Bonuses
1. Internal Cost Savings Pool
2. Bundled Payment Savings Pool
• Both have required Quality Metrics and Cost Savings to be met
• Cost Savings MUST be directly attributed to Quality Improvement and Care Redesign
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BPCI Multiple Bonus Payments: Physicians• 2 opportunities for Physicians to be awarded Bonuses
1. Internal Cost Savings Pool
2. Bundled Payment Savings Pool
• Both have required Quality Metrics and Cost Savings to be met
• Cost Savings MUST be directly attributed to Quality Improvement and Care Redesign
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Internal Cost Savings• DHG Healthcare has one of very few, if not the only, Internal
Cost Savings Gainshare models to have been submitted and approved by CMS at this time
APPROVED
In February 2014, CMMI issued a Request for Information on a new bundled payment program to expand to outpatient.
Focus is Specialty Physicians and on
(1) Procedures and (2) complex chronic care
• Highlighted colonoscopy, cataract surgery, & radiation therapy for procedural options.
• Regarding the chronic care, “CMS is considering development of a model that would incentivize specialists to more efficiently manage the care provided to beneficiaries with complex or chronic medical conditions over the period of time that corresponds to the specialty practitioner’s long term involvement with managing the beneficiary’s care.”
• Was seeking responses until March 13
Outpatient Bundling…coming soon?
Outpatient Bundling• Referred to by CMS as: “Comprehensive Ambulatory
Payment Classification (APC)”
• Finalized in the CY 2014 OPPS/ASC Final Rule
• Affect payments to 4,000 hospitals and 5,300 ASC’s
• Delayed implementation to January 1, 2015 instead of the traditional outpatient October 1 implementation date
– Extra time allowed the Agency, hospitals, and physicians more time to evaluate and comment on the policy
Outpatient Bundling – Comprehensive APC’s• Single Medicare payment rather than individual APC payments
throughout the episode
• 28 Bundled Outpatient Procedures
• Proposed Payment could include all hospital services reported on the claim covered under Medicare Part B for up to a proposed 6 Month Period
– Few exceptions resulting in a single beneficiary copayment per claim
Outpatient Bundling – Proposed Procedures
No.Clinical Family
Proposed CY 2015 APC
APC Title
Proposed CY 2015 APC Geometric Mean Cost
1 AICDP 0090 Level II Pacemaker and Similar Procedures $ 6,961.45 2 AICDP 0089 Level III Pacemaker and Similar Procedures $ 9,923.94 3 AICDP 0655 Level IV Pacemaker and Similar Procedures $ 17,313.08 4 AICDP 0107 Level I ICD and Similar Procedures $ 24,167.80 5 AICDP 0108 Level II ICD and Similar Procedures $ 32,085.90 6 BREAS 0648 Level IV Breast and Skin Surgery $ 7,674.20 7 CATHX 0427 Level II Tube or Catheter Changes or Repositioning $ 1,522.15 8 CATHX 0652 Insertion of Intraperitoneal and Pleural Catheters $ 2,764.85 9 ENTXX 0259 Level VII ENT Procedures $ 31,273.34
10 EPHYS 0084 Level I Eletrophysiologic Procedures $ 922.84 11 EPHYS 0085 Level II Eletrophysiologic Procedures $ 4,807.69 12 EPHYS 0086 Level III Eletrophysiologic Procedures $ 14,835.04 13 EYEXX 0293 Level IV Intraocular Procedures $ 9,049.66 14 EYEXX 0351 Level V Intraocular Procedures $ 21,056.40 15 GIXXX 0384 GI Procedures with Stents $ 3,307.90 16 NSTIM 0061 Level II Neurostimulator & Related Procedures $ 5,582.10 17 NSTIM 0039 Level III Neurostimulator & Related Procedures $ 17,697.46 18 NSTIM 0318 Level IV Neurostimulator & Related Procedures $ 27,283.10 19 ORTHO 0425 Level V Musculoskeletal Procedures Except Hand and Foot $ 10,846.49 20 PUMPS 0227 Implantation of Drug Infusion Device $ 16,419.95 21 RADTX 0067 Single Session Cranial Stereotactic Radiosurgery $ 10,227.12 22 UROGN 0202 Level V Female Reproductive Procedures $ 4,571.06 23 UROGN 0385 Level I Urogenital Procedures $ 8,019.38 24 UROGN 0386 Level II Urogenital Procedures $ 14,549.04 25 VASCX 0083 Level I Endovascular Procedures $ 4,537.95 26 VASCX 0229 Level II Endovascular Procedures $ 9,997.53 27 VASCX 0319 Level III Endovascular Procedures $ 15,452.77 28 VASCX 0622 Level II Vascular Access Procedures $ 2,635.35
Outpatient Bundling – Summary• Comprehensive APC is another step towards CMS establishing
a Prospective Payment Model for OPPS
• Goal: eliminate avoidable costs and increase shared decision making
• Healthcare stakeholders who have been on the sidelines for recent CMS pilots and existing programs will not have this luxury as CMS expands their delivery and payment reform portfolio in the upcoming calendar year
Thank you!
Contact Information:
Walter Coleman
(804) 474-1248
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