Delivering Value for Patients and Payers Context Day 1 Morning Michael J. Deegan, M.D., D.M. Macro-Trends as Drivers of Change US health care costs not sustainable Changing demographics Changing consumer expectations Advances in science & technology Ubiquity of communications technology 2 Old & New Healthcare Paradigms OLD NEW Locus of control Provider Person Emphasis Disease Health Access By Appointment 24 / 7 Data collection Episodic Real time; continuous Analytic tools Limited Many Information Limited; highly Ubiquitous controlled Peer connectivity No Yes ________________________________________________ Adapted from Terini P: Fitting Together Videogames & Health; Robert Wood Johnson Foundation Financial Drivers: Current vs. Future Current Volume Based low accountability for cost of care population defined as patients who seek care infrastructure limits culture rewards more care Future Risk-Based high accountability for cost of care population defined as every patient in panel infrastructure supports full panel management culture rewards value AMGA ACOs & Population Health Management 4 CMS HHS National Quality Strategy THREE AIMS Better Care: improve the overall quality of care by making healthcare more person- centered, reliable, accessible and safe Healthier People, Healthier Communities: improve the health of Americans by supporting proven interventions to address behavioral, social and environmental determinants of health and deliver higher-quality care Smarter Spending: reduce the cost of quality healthcare for individuals, government and communities 5 CMS National Quality Priorities 1.Make care safer by reducing harm caused in the delivery of care 2.Strengthen person and family engagement as partners in their care 3.Promote effective communication and coordination of care 4.Promote effective prevention and treatment of chronic disease 5.Work with communities to promote best practices of healthy living 6. Make care affordable 6 Program Overview DAY 1 DAY 2 DAY 3 DAY 4 AM Overview & Context Data & Metrics Priority 1 to 6 [ Deegan ] Patient Engagement - Experience Priority #2 + 1, 3, 4, 5 & 6 [ Berry Hochhalter ] Patient Safety Priority #1, 3, 4 & 6 [ Schwab ] Transforming Ambulatory Care Priority #4 + 1, 2,3, 5 & 6 [ Fullerton ] PM PI Tools & Tactics Priority 1, 2, 3, 4, & 6 [ Convery ] Patient Safety Priority #1 + 3, 4 & 6 [ Schwab ] Transforming Ambulatory Care Priority #4 + 1, 2, 3, 5 & 6 [ Fullerton ] Resident & Student Education [ Rayburn ] Integration [ Deegan / Convery ] 7 VALUE Defined: Achieving good patient outcomes as efficiently as possible OR Healthcare outcomes achieved per dollar spent 8 Value for Patients & Payers The Right Goal is Value not Cost. 9 Dimensions of Quality QUALITY = Outcomes+ Safety + Experience Clinical Functional Freedom from injury / complications Access Listen Respect Empathy 10 V = Q C V = Q C V = Q C Q C 11 Measuring Value in Health Care* Initial Patient Condition(s) Processes Indicators (Health) Outcomes Structure Patient Reported Patient Experience Patient Compliance *Porter ME: N Engl J Med 363:2477, 2010 suppl 12 Clinical Value Compass* Functional - Physical - Mental - Risk status Clinical -Prevention -Screening -Diagnosis -Rx Monitoring -Morbidity -Mortality -Complications -Adverse events Patient Experience - Services -Overall satisfaction -Access - Health benefit(s) Cost to Patient - Direct medical - Indirect personal - social modified from Nelson EC, et al. Measuring Outcomes & Costs: The Clinical Value Compass in Practice-Based Learning & Improvement, 2007, JCAHO. clinical record billing-claims data patient self report 13 Doctors Leading Improvement to Create Value Lee (2010) Articulate a new vision & values Organize for performance around patient needs Develop a measurement system Build effective teams Dismantle cultural barriers Improve processes Bohmer (2013) Establish a shared, collective purpose Ensure care processes will achieve goals Monitor system performance Improve performance 14 VALUE BASED PURCHASING 15 The Reimbursement Tsunami ACO MSSP MACRA MIPS VBP Narrow Networks APMs EOC Bundles VM MU FFS VALUE 16 17 VBP Conceptual Framework VBP Options Design Features Provider Responses Short Term Effects Long Term Outcomes Provider & Practice Features External Factors P4P SS ACO Bundle Goals Metrics Incentives Risks Patients Q / PI EHR Reorg Gaming QOC Popn Health Costs Spillover effects Unintended Consequences adapted from Measuring Success in Health Care Value-Based Purchasing Programs; Rand, Provider Risk Under Alternate Payment Systems* Cost # Conditions # EOC # / Type Services # Processes Cost = X X X X Person Person Condition EOC Service Process FEE FOR SERVICE EPISODE OF CARE PAYMENT CONDITION SPECIFIC CAPITATION or RSK ADJUSTED GLOBAL FEES PERFORMANCE RISK INSURANCE RISK For Acute Conditions For Chronic Disease *NRHI / RWJF: Better Ways to Pay for Health Care, Jan Early Experience with the Medicare Hospital VBP Plan* % IPPS Payment Retained Dollars Retained # Hospitals Loss > 0.2% # Hospitals Bonus > 0.2% FY 2013 B FY 2014 B TBD FY 2013: Oct 2012 Sept 2013; FY 2014: Oct 2014 Sept 2015; FY 2015: Oct 2015 Sept * CMS 2015 IPPS Proposed Rule; 1 May Early Experience with the Medicare Hospital Readmission Reduction Program % Penalty $ Lost (Est) Conditions FY ?AMI, HF, CAP FY $422M Above + HAK, COPD 21 CMS: Hospital Value Based Purchasing* Domain FY 2013 (Oct 12) FY 2014 FY 2015 FY 2016FY 2017 Clinical Care Processes 70% 45% 20% 10% 5% Patient Experience (HCAHPS) 30% 25% Outcomes NA 25% 30% 40% 25% Efficiency NA 20% 25% Patient Safety 20% Penalty / Reward 1.0% 1.25% 1.50% 1.75% 2.0% *CMS Bulletin March 2013; updated 30 Day Post-discharge mortality for AMI, HF, PN + Composite PSI bundle (2015) + CLABSI (2015) + CAUTI + SSI (2016) Medicare Spending per Beneficiary ( includes Parts A & B from 3 days PTA to 30 days post-discharge) PSI 90 Composite + CLABS, CAUTI, SSI(colon)/AbdomHysterectomy, C. dif, MRSA includes elective delivery prior to 39 weeks gestation 22 Core Measures circa 2013 AMI 1 PCI within 90 minutes - GONE aspirin at discharge - GONE statin at discharge - GONE HF LVS functional level - GONE ACEI / ARB at discharge - GONE discharge instructions - GONE CAP BC in ED pre-Abx - GONE initial Abx in IC patient - RETAINED 23 Outcome Measures Readmissions: AMI, HF, CAP (all cause; 30 days) Mortality Rates: AMI, HF, CAP (all cause; 30 days) Patient Experience HCAHPS Survey: 2016 8 HCAHPS measures 24 Patient Safety Indicators PSI-90 Bundle: pressure ulcer; pneumothorax; infection 2 medical care; postop hip fx, PE-DVT, sepsis, wound dehiscence; accidental puncture or laceration Healthcare Acquired Infections CLABSI rate 2015 CAUTI, SSI [colon + abdom hyst] 2016 MRSA, C. difficile Medicare Spending Ratio 25 Looking Ahead: Medicares Quality-Based Payment Initiatives Impact on Hospitals % REPORTING HOSPITAL QUALITY DATA FOR ANNUAL PAYMENT UPDATE 2% VALUE-BASED PURCHASING 2% READMISSIONS 3% HOSPITAL ACQUIRED CONDITIONS 1% MEANINGFUL USE* 1% *Medicare payments reduced 1% starting in 2015 with an additional percentage point each year up to 5% in PQRI (2007) PQRS (2010) Physician Quality Reporting System Medicare Individual & group Eligible Providers 1; 2 24; 25 99; 100+ PQRS Metrics 2013 259 individual measures 22 measure groups: ex. preventive care Program Transition: Bonus Penalty 2013, 2014 % 2015. -1.5% [2013 baseline] 2016. -2.0% 27 2015 Physician Group VM Experience* 1, Eligible Groups > 100 EPs Did not register -1% Did not meet minimum reporting requirement -1% Did not elect quality tiering 0% Insufficient data 0% Downward adjustment -1% No payment adjustment 0% Upward Adjustment +1% Groups with sufficient data Groups electing quality tiering Meet minimum reporting requirement PQRS GPRO registration in VM based on 2013 results *CMS report, June 16, 2015 Additional 268 eligible groups excluded for ACO participation No PCPs in Upward Adjustment group 28 MACRA & MIPS 29 What is MACRA? The Medicare Access and CHIP Reauthorization Act What Does MACRA Do? Repeals the Sustainable Growth Rate Formula Changes the way Medicare rewards clinicians for Value over Volume Streamlines multiple quality programs thru MIPS Provides bonus payments for participation in eligible Alternative Payment Models [APMs] 30 2016 HHS Goals 2018 All Medicare ffs payments Medicare ffs payments linked to quality - value Medicare payment to APMs linked to quality - value Medicare payment to advanced APMs under MACRA 85% 90% 30% 50% Invite private payers to match or exceed HHS goals 31 MIPS Changes How Medicare Links Performance to Payment PQRS Physician Quality Reporting System Value-Based Payment Modifier MU Medicare EHR Incentive Program MIPS Merit-based Incentive Payment System Currently 3 Medicare Quality & Value programs for Physicians 32 MIPS Provider Scoring Quality Initiatives Resource Utilization Clinical Practice Improvement Efforts Meaningful Use MIPS Composite Performance Score 33 Annual MIPS Adjustments + 4% - 4% + 5% - 5% + 7% - 7% + 9% - 9% onward Program is: -budget neutral -provider composite score may result in positive, neutral, negative change in Medicare part B base rate 34 Alternative Payment Models APMs are new Medicare payment options to incentivize quality and value [ MACRA authorized ] CMS Innovation Center model MSSP [Medicare Shared Savings Program] Health Care Quality Demonstration program Demonstration authorized under federal law 35 How Will MACRA Impact Me? YES NO YES NO YESNO Am I in an APM? Am I in an eligible APM? Do I have enough patients or payments thru my APM? Is this my first year in Medicare Or am I below the low-volume threshold? Not subject to MIPS Subject to MIPS Subject to MIPS Favorable MIPS scoring APM-specific rewards Qualifying APM Participant 5% lump sum bonus Higher fee schedule updates APM-specific rewards Excluded from MIPS 36 2015 VM Quality Cost Tiers & Content Domains QUALITY LOW AVERAGE HIGH COST LOW 0.0% +1.0 x AF* +2.0 x AF* AVERAGE -0.5% 0.0% +1.0 x AF* HIGH -1.0% -0.5% 0.0% Quality Domains Clinical process / effectiveness Patient - family engagement Population - public health Patient safety Care coordination Efficient resource use Cost Domains Per capita cost all attributed beneficiaries Per capita cost for beneficiaries with specific conditions *2015 Adjustment Factor = 4.89% if in top 25% beneficiary risk scores 37 VM: Ambulatory Care Sensitive Condition Composite Acute Conditions Bacterial Pneumonia Urinary Tract Infection Dehydration Chronic Conditions Diabetes - ST complications - LT complications - Uncontrolled - Lower extremity amp COPD Heart failure 38 CMS Ambulatory Quality Performance Programs VOLUNTARY INCENTIVE PENALTY Surgery Center Quality Reporting 2% APU Meaningful Use of EHR MU 1% eRx eRx 1 2% Medicare Shared Savings ACO (MSSP) PQRS PQRS 1.5 2% Physician Value Modifier 1 - 2% What Will the Commercial Insurers Add to this? 39 Path to Value, CMS, QUESTIONS COMMENTS 41