VERMONTALLPAYERMODELPROJECTUPDATE
ELEMENTSOFTHEPROPOSEDTERMSHEETGMCBANALYTICALMODELING
JANUARY28,2016
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Agenda
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Time AgendaItems
9:15–9:209:20–9:50
9:50–11:30
IntroducJonPartI:All-PayerModelProjectUpdate• BriefHistory• StatusofNego9a9onswithCMSPartII:ElementsoftheTermSheet
11:30–12:00 PublicComment
12:00–2:30 BREAK
2:30–3:40 PartIII:GMCBAnalyJcalModeling• UseofModeltoDate• Presenta9onofFinancialModel
4:00–5:00 PublicComment
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PartI:All-PayerModelProjectUpdate
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• BriefHistory• StatusofNego9a9onswithCMS
Act 54 of 2015
TheSecretaryofAdministra8onordesigneeandtheGreenMountainCareBoardshalljointlyexploreanall-payermodel,whichmaybeachievedthroughawaiverfromtheCentersforMedicareandMedicaidServices.
-EnactedJune5,2015
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All-Payer Model
• Anall-payermodelisanagreementbetweentheStateandtheCenterforMedicareandMedicaidServices(CMS)thatallowsVermonttoexplorenewwaysoffinancinganddeliveringhealthcare.
• Theall-payermodelenablesthethreemainpayersofhealthcareinVermont–Medicaid,Medicare,andcommercialinsurance,topayforhealthcaredifferentlythanthroughfee-for-servicereimbursement.
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Goals of a Transformative All-Payer Model
• Improveexperienceofcareforpa9ents• Improveaccesstoprimary,preven9veservices
• Rewardhighvaluecare• Constructahighlyintegratedsystem
• Empowerprovider-ledhealthcaredeliverychange
• Controltherateofgrowthintotalhealthcareexpenditures• Alignmeasuresofhealthcarequalityandefficiencyacrosshealthcaresystem
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Why Pay Differently Than Fee-for-Service?
• Healthcarecostgrowthisnotsustainable.
• Healthcareneedshaveevolvedsincethefee-for-servicesystemwasestablishedmorethanfi\yyearsago.
• Morepeoplearelivingtodaywithmul9plechroniccondi9ons.• CDCreportsthattrea9ngchroniccondi9onsaccountsfor86%of
ourhealthcarecosts.
• Fee-for-servicereimbursementisabarrierforproviderstryingtocoordinatepa9entcareandtopromotehealth.
• Carecoordina9onandhealthpromo9onac9vi9esarenotrewardedbyfee-for-servicecompensa9onstructure.
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Foundation for an All-Payer Model
• Vermonthasall-payerreformsinplacetoday
– SharedSavingsProgram(SSP)forAccountableCareOrganiza9ons(ACOs)• MedicareoffersaSSPforACOs• CommercialSSPStandards• MedicaidSSPStandards
– TheBlueprintforHealth• Medicarepar9cipatesthroughademonstra9onwaiver• Commercialpar9cipa9on• Medicaidpar9cipa9on
• Fee-For-Serviceiss9lltheunderlyingpaymentmechanisminthesemodels
Next Generation of Accountable Care
• ThefederalgovernmenthascreatedprogramsthatencouragetheuseofAccountableCareOrganizaJons(ACOs).
• ThefederalNextGeneraJonACOprogramallowsACOstobepaidanall-inclusivepopula9on-basedpaymentforeachMedicarebeneficiaryacributedtotheACO.CMSwillallowACOssomeflexibilityincertainpaymentrulesinexchangeforaccep9ngthisnewtypeofpayment.
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Leveraging Federal and State Payment Reform Efforts
• Vermont’sproposalisforallpayerstoapproachhealthcarepaymenttoACOsinacommonway.– New,all-inclusivepopula9on-basedmodelofreimbursementrewards
healthcareprofessionalsthatareadap9ngtothechangingneedsofthepopula9on;leverageNextGenera9onmodel.
– Allpayersgivedoctorsandotherhealthcareprofessionalstheflexibilitytheyneedtoleadhealthcaredeliverychange.
• Healthcareproviders’par9cipa9oninACOsisvoluntary;theACOmustbeacrac9vetoprovidersandofferanalterna9vehealthcaredeliverymodelthatisappealingenoughtojoin.
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Status of Negotiation with CMS
• GMCBandAOAhavejointlyexploredanall-payermodelthroughdialogueandnego9a9onwithCMS.
• Theresultofthisdialogue,andconsulta9onwithstakeholdersandconsultants,isatermsheetproposedbytheStateofVermonttoCMS– Proposedtermsheetdescribesthebasicpolicyframeworkthatwould
allowVermont’shealthcareproviders,payers,andthegovernmenttooperateanall-payermodel.
– Theproposedtermsheetdoesnotbindthestateorfederalgovernments.
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Next Steps
• PublicPar9cipa9onandComment– Thetermsheetisavailabletothepublicthroughdistribu9ontothe
mediaandpos9ngontheAgencyofAdministra9onandGreenMountainCareBoard’swebsites.
– ThetermsheethasbeendistributedtoLegislators.– TheGreenMountainCareBoardwillholdopen,publicmee9ngsto
discussandevaluatethetermsheet.
– Aformalpubliccommentperiodonthetermsheetwillbeini9atedbytheGreenMountainCareBoard.
– TheAgencyofAdministra9onwillacceptpubliccommentsathcp://hcr.vermont.gov/home.
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Next Steps
• AssessandEvaluateAll-PayerModelProposal– Takingallpointsofviewintoconsidera9on,theGreenMountainCare
BoardandtheAgencyofAdministra9onmustindependentlyassessthepoten9aloftheall-payermodeltobuildasystemthatofferstherightincen9vesandrewardsprovidersfordeliveringonthepromiseofintegrated,coordinated,highqualitycare.
– Attheconclusionofthisevalua9on,theGreenMountainCareBoardandtheAgencyofAdministra9onwilldeterminewhetherandhowtheall-payermodelproposalshouldbeadjustedtoreflectstakeholderinput.
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Next Steps
• Basedonevalua9onoftermsheet,– Con9nuenego9a9onswithCMSonAll-PayerModel
– IfVermontdecidesthefinalagreementisnotbecerthantoday’ssystem,itcanendthenego9a9onwithCMS.
– Similarly,ifCMSisnotsa9sfiedthattheoverallproposalmeetsitspolicyandfinancialgoals,itcandeclinetoenterintotheagreement.
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Steps Toward an Improved Vermont Health Care System
DevelopAll-PayerModelandFinancialTargets
CreateStandardsforAccountableCareOrganiza9onProgram
ExerciseGMCBRateandRegulatoryAuthority
AcainQualityImprovementandCostControl
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PartII:ElementsoftheTermSheet
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Vermont’s Proposed Term Sheet
• Thetermsheetincludesallofthebasiclegal,policy,andenforcementprovisionsthatwouldbeinaModelAgreement.
• Insomecases,termsrefertoappendiceswhichwillhavegreatertechnicaldetailortoprocessesthatwilloccurduring2016.
Term
1. LegalAuthority2. PerformancePeriod3. MedicareBeneficiaryProtec9ons4. MedicareBasicPaymentWaivers5. MedicareInnova9onWaivers6. InfrastructurePaymentWaivers7. FraudandAbuseWaivers8. RequestforAddi9onalWaivers9. Revoca9onofWaivers10. All-PayerRateSenngSystem11. ProviderPar9cipa9oninAlterna9vePayment12. RegulatedServices13. FinancialTargets14. QualityMonitoringandRepor9ng15. DataSharing16. AllPayerModelEvalua9on17. Modifica9on18. Termina9onandCorrec9veAc9onTriggers
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Term #1: Legal Authority
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Medicareauthority,throughtheInnovaJonCenter(CMMI):SecJon1115(A)oftheSocialSecurityAct
MedicaidauthorityaddressesexisJngMedicaidlawsinrelaJontothemodel.• SpecifiesthatVermontwillensurethatthestate-federalagreementsinplace(intheformofstateplans
or1115demonstra9onwaivers)willbemodifiedtoaccommodatetheall-payermodel.
Vermontauthority,acJngthroughGMCB,addressesthreeregulatoryfuncJons:• AuthoritytoenterintotheagreementwithCMMI
• GMCBhasauthorityto“[o]verseethedevelopmentandimplementa9on,andevaluatetheeffec9veness,ofhealthcarepaymentanddeliverysystemreformsdesignedtocontroltherateofgrowthinhealthcarecostsandmaintainhealthcarequalityinVermont.”18V.S.A.§9375(b)(1)
• Authoritytosetratesforprovidersandrequirepayerstocomplywiththoserates• GMCBhasauthorityto“setreasonableratesforhealthcareprofessionals,healthcareprovider
bargaininggroupscreatedpursuanttosec9on9409ofthis9tle,manufacturersofprescribedproducts,medicalsupplycompanies,andothercompaniesprovidinghealthservicesorhealthsuppliesbasedonmethodologiespursuanttosec9on9375ofthis9tle,inordertohaveaconsistentreimbursementamountacceptedbythesepersons.”18V.S.A.§9376(b)(1).
• AuthoritytoregulateanACOandothercomponentsofthehealthcaresystem• Referstotheauthori9escitedaboveandGMCBauthoritytosethospitalbudgets,regulateinsurance
ratechanges,andregulatecapitalexpendituresofhealthcarefacili9es.
StatementsaffirmingtheauthorityofMedicare,Medicaid,andVermont(throughtheGMCB)toenterintotheAll-PayerModelagreement
Term #2: Performance Period
• Five-yearperformanceperiodfrom2017to2021
• Uponsigningamodelagreement,Vermontentersan“opera9onalcapacitybuilding”periodun9limplementa9ononJanuary1,2017
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Setsthe9meframeforimplemen9ngtheall-payermodel
Term #3: Medicare Beneficiary Protections
• ThistermstatestheprinciplethataccesstocareandprovidersforMedicarebeneficiarieswillnotbelimited– Medicarebeneficiarieswillhavefullfreedomofchoiceofproviders– Allexis9ngbeneficiaryrightsandprotec9ons(likeappealrights)will
beprotected
– Medicareundertheall-payermodelwillincludeallthesameservicesandcoverageasoriginalMedicare
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Provisionstoenshrineallexis9ngprotec9onsforMedicarebeneficiariesinVermontundertheall-payermodel
Term #4: Medicare Basic Payment Waivers
• BasicpaymentwaiversrelatetolawsthatgovernratessetforMedicareregulatedservices– Currentlythissec9ondocumentsthelawsthatcreatetheinpa9ent
prospec9vepaymentsystem(IPPS)andtheoutpa9entprospec9vepaymentsystem(OPPS)forhospitals.
– Ul9matelyanagreementwouldneedtoincludethelawsthatgovernreimbursementforallregulatedservices,includingphysicianservices,homehealthservicesandothers.
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ThetermSheetcontains4separatetypesofwaiversofMedicarelaws
Term #5: Medicare Innovation Waivers
• MedicareinnovaJonwaiversremoverestric9onsonservicesorauthorizeexpandedservicesforbeneficiaries– Eliminaterequirementfora3-dayhospitalstaybeforeadmissiontoa
nursinghome
– Authorizetelehealthservicesforallbeneficiaries– Enablehomevisitswithoutphysiciansupervisiontoallowother
licensedclinicians
• LanguageallowsVermonttoseekaddi9onalwaiversunderconsidera9ontoenhanceMedicareservices– ExpandingNursePrac99onerscopeofprac9cerules– Enhancingtheavailabilityofhomecareandhospiceservices
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ThetermSheetcontains4separatetypesofwaiversofMedicarelaws
Term #6: Infrastructure Payment Waivers
• InfrastructurepaymentwaiversallowMedicaretopar9cipatefullyintheBlueprintforHealth– Con9nua9onofCHTpayments– ExpansionofSASHpayments
• ThistermalsoincludeswaiversnecessarytosupporttheHub&SpokeProgram– Paymentformedica9on-assistedtherapiesatspecialtyopioid
treatmentcenters
– Infrastructuresupportfor“Hubs”
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ThetermSheetcontains4separatetypesofwaiversofMedicarelaws
Term #7: Fraud and Abuse Waivers
• Fraudandabusewaiversprotectproviderspar9cipa9nginanACO– Thesearethesamewaiversgrantedtopar9cipantsinMedicare’s
exis9ngACOprograms–authorizereferralsandsharingofsavingsacrossproviders
– Fivecategoriesofwaivers– ACOPre-Par9cipa9onWaiver
– ACOPar9cipa9onWaiver
– SharedSavingWaiver
– CompliancewithPhysicianSelf-ReferralWaiver– Pa9entIncen9vesWaiver
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Thetermsheetcontains4separatetypesofwaiversofMedicarelaws
Term #8: Request for Additional Waivers
• Addi9onalwaiversmaybesubmicedbyVermontalongwithara9onaleforthewaiveratany9me– ThesearegrantedonlyifCMSagrees– IfCMSdeniesarequestandVermontdeterminesthatthewaiveris
necessarytoachievethegoalsofthemodelagreement,Vermontmayterminatetheagreement
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SpecifieshowVermontmayrequestaddi9onalwaiverstocarryouttheall-payermodel
Term #9: Revocation of Waivers
• CMSmayrevokewaiversorterminatetheagreementifVermontdoesnotcomplywithcondi9onsassociatedwiththewaiver.– Anywaivercondi9onswillbemadeexplicitinthefinalmodel
agreement
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AuthorizesCMStorevokewaiversorterminatetheagreement
Term #10: All-Payer Rate Setting System
• Vermontwillmaintainanallpayerratesenngsystemforallregulatedservices
• Medicarerateswillbeestablishedinoneoftwoways– ThroughanACO-basedreimbursementmethod
– UsingtheMedicarefeescheduleasareference
• LanguagecontemplatesVermontandCMSworkingtogethertodesignaclaimsprocessingandpaymentapproachforACOservicesandpaymentsthatconformstoVermont’splanandCMSopera9onalrequirements
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Describesingeneraltermstheopera9onoftheall-payersystem
Term #11: Provider Participation in Alternative Payment Models
Beginningin2019,anewfederallaw–theMedicareAccessandCHIPReauthorizaJonActof2015(MACRA)–willgovernMedicarephysicianpayments• MACRAcreatesanewframeworkforexis9ngqualityrepor9ngprogramsand
encouragesphysicianstopar9cipateinalterna9vepaymentmodels
• Alterna9vepaymentmodelsincludeACOs,pa9ent-Centeredmedicalhomes,andbundledpaymentmodels
• Providerswhoqualifycanreceiveincen9vepaymentsunderMACRA
ThetermsheetspecifiesthatprovidersparJcipaJngintheACOinVermont’sall-payermodelwillqualifyfortheMACRAincenJvepayments
• Willreceivelumpsumbonuspaymentsof5%ofaphysician’stotalMedicarepayments
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StatesthatVermontwillu9lizeanACOmodelundertheall-payermodel
EnsuresthatVermontwillbenefitfromanewMedicarephysicianpaymentlawthatencouragesproviderstopar9cipateinalterna9vepaymentmodels
Inessence,RegulatedServicesarethosecoveredbytheModelAgreement
• InMaryland,themodelagreementonlyregulateshospitalpayments.InVermont,regulatedservicesaremoreexpansive
• DerivedfromcurrentfederalandstateSSPs
• ForMedicare:PartsAandBServices
• ForMedicaidandCommercial:TheclosestanaloguetothoseMedicareservices
• Definedbycategoriesofservice
RegulatedRevenuecanbedifferentfromtheservicesforwhichtheACOisatrisk.
• TermsheetindicatesaninterestinpursuingpharmacyasanACO-coveredservice
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RegulatedServices:SpendingcategoriessubjecttotheallpayerceilingandfromwhichMedicaresavingsarederived
Term #12: Regulated Services
All Payer Baseline
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Medicare Services Parts A-B = 87.7% Part D = 12.3%
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Commercial Services Covered = 71.4% Non-covered = 28.6%
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Medicaid Services Covered = 34.3% Non-covered = 65.7%
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Regulated Services in Relation to the Overall Delivery System
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ThegoalofalloftheworkVermontisdoingandwilldoistocreateanintegratedsystem.Vermontiscommifedtopaymentanddeliveryreformacrossallservices,whetherinsideoroutsideoftheall-payermodel.
Underthislanguage,VermontmayphaseinaddiJonalservicesintotheregulatedenvironmentandincludemorehealthcarespendingover9mebasedonmutualagreementwithCMMI/CMS
Vermontcandefineapathwayforassessingreadinesstoconsiderinclusionoftheseservicesintheall-payermodel.Vermontwillevaluate
• Payerandproviderreadiness
• Healthinforma9oninfrastructure
• Evalua9onreadiness• Federalreadiness
Term #13: Financial Targets: All-Payer Ceiling
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• All-PayerCeiling:adefinedupperlimitonpercapitaspendinggrowth
• All-PayerTarget:adefinedtargetforpercapitaspendinggrowtho TheAll-PayerTargetisVermont’sgoalforspendinggrowth
o TheAll-PayerCeilingisVermont’sobliga9onundertheModelAgreement
Measure Growth
15-YearEconomicGrowth(GrossStateProduct)
3.3%
All-PayerTarget 3.5%
All-PayerCeiling 4.3%
FailuretomeetceilingorMedicaresavingsisa“triggeringevent”–canleadtoa“correcJveacJonplan”
– Requiresawricenresponseandanactualplan
– Couldincludeprogramma9cchanges,modelchanges,orrateadjustments
– Termsheetspellsoutwhatcons9tutesa“triggeringevent”
Term #13: Financial Targets: Medicare Savings
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• MedicareSavings–minimumsavingsrequiredundertheagreement• Separatelycalculatedandbenchmarkedtona9onalpercapitagrowth
• BenchmarkFloor–proposesafloortoguardagainstlowna9onalMedicaregrowth
Savingsarecalculatedoverthe5-yeartermoftheagreement• Thisprovidesconsiderableflexibility,butplacesemphasisonstrongperformancein
theearlyyearsoftheagreement
Thebenchmarkfloorisanovelideathatcouldbeverycontroversial• CMSunderstandsVermont’sconcernsandwilltrytoaddressthem
• ToguardagainstbeingputinadeficitinYear1• TorecognizethatVermontisaverylow-coststate
MedicareSavingsTarget 0.2%belowna9onalpercapitagrowth
BenchmarkFloorPerformanceYear1:3.5%
PerformanceYears2-5:2.0%
Medicare Savings with an Aging Population
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ThetermsheetaddressesthechallengethatVermontfacesbyhavingalargershareof85+yearoldMedicareenrolleesthanthenaJonalaverage.• Contemplatesanage-adjustedMedicaresavingscalcula9ontoadjustforrela9ve
differencesbetweenthena9onalandVermontpopula9on
Term #14: Quality Monitoring and Reporting
POPULATIONHEALTH• Establishedgoalsandpopula9onhealth
measureswillallowthestateandCMStomonitorprogressonthehealthofthepopula9oninpriorityareas
1. Increasingaccesstoprimarycare
2. Reducingtheprevalenceofandimprovingthemanagementofchronicdiseases
3. Addressingthesubstanceabuseepidemic
• Statewidemeasureswillbecollectedusingstatewidetools(BRFSS,surveillancedata,deathdata)
ALL-PAYERMODELQUALITYTARGETS• Establishedtargetswillmeasureclinical
interven9onsthatleadtohealthimprovementsrelatedtothepopula9onhealthpriorityareas
• Thesemeasuresarecurrentlycollectedandreflectprovenclinicalinterven9ons
• Establishingqualitytargetsdirectlyrelatedtopopula9onhealthgoalswillensurethattheclinicaldeliverysystemisalignedwithstatepriori9es
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VermontisproposingtoestablishpopulaJonhealthgoalsandmeasurestobemonitoredandwillsetall-payermodelqualitytargetsrelatedtothosegoalsBothsetsofmeasureswillbeestablishedtogetherwithCMMIbyJune1,2016
All-Payer Model Quality Framework
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PopulaJonHealth
Measures
All-PayerWaiverQuality
MeasuresACOQualityMeasures
ProviderQualityMeasures
CMMI GMCB
GMCB ACO
ACO Providers
ReporJngandMonitoringMeasures• Necessaryoverallprioritymeasuresforrepor9ng
successofthemodel• MayoverlapwithACOandprovider-specific
qualitymeasures• DerivedfromStatePriorityGoals• Repor9ngcategories:ACO,non-ACO
SetGoalsandMonitor
CMMI VDH/GMCBPrevalenceandAccessMeasuresforStatePriorityGoals1. Increasingaccesstoprimarycare2. Reducingtheprevalenceofandimprovingthe
managementofchronicdiseases3. Addressingthesubstanceabuseepidemic
SetTargetsforAll-PayerModelAgreement
AdjustACOPayments
AdjustProviderPayments
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Term #15: Data Sharing
• Vermontsuppliesall-payerclaimsfromVHCURESonaquarterlybasis
• CMSwillacceptdatarequestsfromVermonttofurtherthepurposesofthemodel,andwillapprove,denyormodifywithin30daysofanyrequest,subjecttoprivacyandsecuritylaws
• ProposesthatCMSwillsharewithVermontdatanecessarytodetermineproviderperformance,andauthorizesVermonttodisclosesuchperformancedata
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Describesexpecta9onsaboutdatasharingandtheprocessfordatarequests
Term #16: All-Payer Model Evaluation
• CMSwillevaluatethemodelinaccordancewithSec9on1115(a)(b)(4)– Thisisasubstan9alevalua9onandwillcompareVermonttona9onal
Medicareandtootherstates
• VermontwillsubmitanannualreporttoCMSconcerningitsperformanceonthefinancialandqualityrequirementsofthemodelagreement– Thiswillincludeperformanceontheall-payerceiling,and
performanceonqualitymeasuresestablishedunderTerm#14.
• Containstechnicallanguageaboutmaintenanceofrecords
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DescribeseffortsbyVermontandCMStoevaluatetheimplementa9onoftheall-payermodel
Term #17: Modification
• Bothpar9esmayamendtheagreementatany9mebymutualconsent
• CMSmayamendtheagreementforgoodcauseorifnecessarytocomplywithfederalorstatelaworregula9on– CMSprovides30daysno9ce
– IfVermontdisagreeswiththemodifica9on,orcannotadoptitbecauseitiscontrarytostatelaw,CMSorthestatemayterminatetheagreement
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Specifiestheprocessforeitherpartytosuggestamendmentstothemodelagreement
Term #18: Termination and Corrective Action Triggers
• Enforcementofthemodelisdrivenbytheoccurrenceofspecified“triggeringevents”
• AmaterialbreachoftheModelAgreement• Adetermina9onbyCMSthatVermonthasnotproducedagreed-uponMedicare
savingsfor2consecu9vePerformanceYears• Adetermina9onbyCMSthatVermonthasexceededtheall-payerpercapitagrowth
ceilingby1.0percentagepointormorefor2consecu9vePerformanceYears• Adetermina9onbyCMSthatthequalityofcareprovidedtoMedicare,Medicaidor
CHIPbeneficiarieshasdeteriorated• Adetermina9onbyCMSthattheStateand/orACOhavetakenac9onsthat
compromisetheintegrityoftheModelortheMedicaretrustfunds
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Specifiestheprocessfortermina9onofthemodelagreement
Describestheenforcementoftheagreement,intheformofcorrec9veac9onplansbasedondefinedtriggeringevents
Term #18: Termination and Corrective Action Triggers (continued)
• Ifatriggeringeventoccurs,CMSprovidesawarningno9cewithin6monthsoftheendofaperformanceyear
• Vermonthas90daystorespondtotheno9ce,andwithin90daysofitsresponseCMScanrequireVermonttoproduceacorrec9veac9onplan(CAP)
• Vermonthas1yeartosuccessfullyimplementtheCAP
• IftheCAPisnotimplemented,CMScanrescindpartoftheagreementorterminateit
• Ingeneral,thestatemayterminatetheagreementforanyreasonwith180dayswricenno9ce
• Upontermina9on,Vermonthas2yearstotransi9onbacktothena9onalMedicareprogram
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PartIII:GMCBAnalyJcalModeling
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The GMCB All-Payer Analytical Model
1.UseoftheModeltoInformtheNegoJaJons
2.PresentaJonoftheModel• All-PayerSummaryProjec9ons• RegulatedRevenue• CategoriesofService• Representa9veUsesoftheModel• Projec9onModel• TheModelasaToolforGMCB
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