EPtalk by Dr. Jayne 12/22/16

There has been a lot of information coming out of CMS over the last couple of weeks, and I’m sure some organizations are missing it in the holiday rush. I know I missed some of the announcements when they came out last week. Sometimes I’m not sure whether subscribing to multiple news feeds and aggregators helps me or adds to the issue.

Some of the hottest debate is around changes to the CMS bundled payment programs, including two new mandatory programs for heart attack care and bypass surgery. The other changes are to the hip and knee replacement program. The new programs will qualify as Advanced Alternative Payment Models for the purposes of MACRA. Within the Acute Myocardial Infarction Model and the Coronary Artery Bypass Graft Model, flat fee payments will occur instead of line-item payments for procedure-related services.

These models will launch on July 1, 2017 and run through December 31, 2021. Hospitals from 98 metropolitan areas were selected for participation, which again is mandatory. Any savings during the first two performance years can be kept by the facilities, but starting in the third year, hospitals will be required to repay a portion of the extra costs with a gradual increase in that repayment portion. Bonuses for demonstration of defined quality metrics will be available, starting at 5 percent in the first three years and moving up to 20 percent in the fifth year.

There is also an incentive for providers to refer heart attack patients for rehabilitation under the Cardiac Rehabilitation Incentive Payment Model. Hospitals will receive $25 per service provided to patients post-MI or bypass for up to 11 services per patient. After that, the payment goes up to $175 per service. Cardiac rehabilitation has proven value in the clinical realm, so it’s nice to see CMS putting money in play to incent desired behaviors.

Bundled payments under the Comprehensive Care for Joint Replacement Model are also expanding, adding hip and femur fracture care. The Surgical Hip and Femur Fracture Treatment Model will also count as an Advanced APM under MACRA. CMS webinars are forthcoming and will detail the new payment programs and the hoops that providers must jump through to qualify for bonuses. As is usual for new CMS programs, there will be a flurry of fact sheets and open forums where providers and organizations can ask their questions. Response to the announcement has been mixed, with the American Medical Association in support and the American Hospital Association against, largely due to the fact that participation is mandatory.

Hospitals in the impacted regions have a little over six months to prepare, which isn’t a lot of time when you’re talking about the need to analyze current state and apply interventions to support a new paradigm. Those of us in the consulting space would encourage everyone to start thinking about this, even if you’re not in one of the mandated performance areas, to start making changes as well. It’s highly likely that these programs will expanded and the sooner you prepare, the easier the transition will be.

CMS also announced two new Accountable Care Organizations, one of which is tantalizingly named “Track 1+.” It has less downside risk than the existing tracks in the Medicare Shared Savings Program and is designed to bring smaller practices into the risk-assumption fold. It is set to launch in 2018 and the hope is to bring up to 70,000 providers on board. Smaller or rural hospitals could have less risk than their larger counterparts, which could be attractive to those organizations who are on the fence about being an ACO. Interested groups can submit an intent to apply as soon as May 2017. Whether they’re admitted to the track or not, there is good reason to start preparing now.

The second one, the Medicare-Medicaid ACO Model is designed to address the needs of dual-eligible beneficiaries who are covered under both programs. Although these patients could previously participate in Medicare ACOs, there was no financial accountability for the Medicaid spending for these patients. The new ACO allows for management of both sets of costs. States can submit letters of intent to work with CMS to design the state-specific requirements. Up to six states will be selected with priority given to states with lower Medicare ACO participation. Once states are identified, applications will be released to ACOs and providers.

Regardless of the proliferation of new models, some analysts have suggested that they may not be fully rolled out or may be significantly changed after new leadership hits HHS after the inauguration. That’s exactly the same kind of thinking we’ve seen intermittently over the last decade, where providers wait to take action because they think there’s a chance of change. For some, that has caused a lot of angst when they realized that their watch-and-wait attitude only served to cause a flurry of activity later. I sympathize with their hope that a new administration will come in and wipe the slate clean, but given the continued escalation in healthcare costs and the political pressure to drive them down, it’s not entirely realistic. I still would love to see regulation in the health insurance space but that’s not entirely realistic either.

As of early 2016, nearly 30 percent of Medicare payments were tied to quality and value and the next milestone is to try to tie 50 percent of payments to those parameters by 2018. We’re going to continue to see a proliferation of new programs that can be confusing and maddening. I hope those in the trenches are considering New Years’ Resolutions that promote serenity and relaxation, because it’s going to continue to be a slog.

Have you started thinking about your resolutions yet? Email me.

Email Dr. Jayne.