Gary Swartz, JD, MPA Associate Executive Director American Academy of Home Care Medicine ©AAHCM Value Based Purchasing

 Context and history  VBP and risk adjustment (RA) defined  VBP w RA embedded across public and private models  Academy advocacy to assure accurate risk adjustment for your HBPC population; request for your help  VBP with RA provides HBPC professional services and organizational leadership opportunities ©AAHCM

 Siloed care has been supported by 1960’s Medicare “insurance program”  Fragmented care, payment and professional silos and communication barriers  Medical care/Medicare cost increases  Legislative; Patient Protection and Affordable Care Act and BBA (1997) for Medicare Advantage  Risk adjustment and value based purchasing ©AAHCM

Type of Value-Based Purchasing Program VBPP and SettingTimeline Hospital Value-Based Purchasing ProgramOctober 1, 2012 (current program) Physicians (or groups of physicians) under Physician Value- Based Payment Modifier January 1, 2015, for a subset of physicians January 1, 2018, for all physicians (program to be implemented) Inpatient critical access hospitalsNo later than 2 years after date of act (May 1, demo.) Hospitals excluded from HVBP due to insufficient numbersNo later than 2 years after date of act (May 1, 2010) – demo.) Long-term care hospitalsNo later than January 1, 2016 (pilot program) Hospice programsNo later than January 1, 2016 (pilot program) Psychiatric hospitalsNo later than January 1, 2016 (pilot program) Rehabilitation hospitalsNo later than January 1, 2016 (pilot program) PPS-exempt cancer hospitalsNo later than January 1, 2016 (pilot program) Ambulatory surgical centers Submit plan to Congressno later than January 1, 2011 (plan for program) Home health agencies Submit plan to Congressno later than October 1, 2011 (plan for program) Skilled nursing facilities Submit plan to Congressno later than October 1, 2011 (plan for program) Shared Savings ACOsno later than January 1, 2012 (current program) Bundled Payment Hospital/physicians/post-acute careno later than January 1, 2012(demonstration program)

 MD, NP, PA and others  Hospitals  Ambulatory settings  CMS Innovation Center (ACOs, Shared savings)  Post Acute ◦ IMPACT Act ◦ BACPAC (proposed) ©AAHCM

 Mix of payment method and model change  Measures based data development for payment and reporting  Public reporting/transparency – Compare programs; “Stars Ratings” ©AAHCM

Value = Quality ÷ Cost ©AAHCM

Agency for Healthcare Research and Quality (AHRQ) Business Group on Health Buyers hold providers accountable for cost and quality Demand side strategy to measure, report, and reward excellence in health care delivery. Information on quality, outcomes, health status (measure development) Actions of coalitions, employer purchasers, public sector purchasers, health plans, and individual consumers in making decisions that take into consideration access, price, quality, efficiency, and alignment of incentives. Reduce inappropriate care Identify and reward best performers Effective health care services and high performing are rewarded with improved reputations through public reporting, enhanced payments and increased market share

Standardized Exchange Plans State Managed Care/Duals Medicare Advantage Medicare Fee Schedule - MIPS Alternative Payment Models/ACOS Hospitals Post Acute Impact Act Part A Part B SGR Repeal Private Non Medicare Pact C ©AAHCM

Value based payment Risk adjustment Diagnostic coding ©AAHCM

 Provides for differential payment to a physician or group of physicians under the Medicare Physician Fee Schedule (PFS)  based upon the quality of care furnished compared to the cost of care during a performance period  Value Modifier is an adjustment made on a per claim basis to Medicare payments for items and services under the Medicare PFS. ©AAHCM

 TINs treating a large number of beneficiaries with multiple chronic conditions  could perform worse on certain quality and cost measures than TINs with relatively healthy beneficiaries  due, at least in part, to differences in their beneficiary populations. ©AAHCM

Risk adjustment facilitates more accurate comparisons by accounting for differences in beneficiary case mix across TINs ©AAHCM

 A process of adjusting: health plan payments, or health care provider payments, or premiums  to reflect the health status of beneficiaries or plan members ©AAHCM

 Definition varies by the application across Medicare payment models  Risk score of 1.0 corresponds to average expected expenditure; higher risk scores are associated with higher expected expenditures  The right risk adjuster is critical ©AAHCM

YearMedicare Fee Schedule % increase each year rates plus ability to receive additional payment through Merit-Based Incentive Payment System (MIPS) % bonus for those participation in qualified alternative payment models

©AAHCM Consolidates 3 Current Programs Beginning 2019 Merit-based incentive payment system The Physician Quality Reporting System (PQRS) that incentivizes professionals to report on quality of care measures; The Value-Based Modifier (VBM) that adjusts payment based on quality and resource use in a budget- neutral manner; and Meaningful use of EHRs (MU) that entails meeting certain requirements in the use of certified EHR systems. Payments to professionals will be adjusted based on performance in the unified MIPS starting in Applies to:MDs, NPs, PAs and others What is the harmonization that occurs through the "merit-based incentive payment system" (MIPS)?

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Quality 30 percent Measures used in the existing quality performance programs (PQRS, VBM, EHR MU), Secretary to solicit recommended measures Measures used by qualified clinical data registries Resource Use 30 percent Measures used in the current VBPM program Additional process to report specific role in treating the beneficiary Research on how to improve risk adjustment to ensure professionals are not penalized for serving sicker or more costly patients Meaningful Use 15 percent Current EHR Meaningful Use requirements, demonstrated by use of a certified system Professionals who report quality measures through certified EHR systems for the MIPS quality category are deemed to meet the meaningful use clinical quality measure component Clinical Practice Improvement Activities 25 percent Professionals will be assessed on their effort to engage in clinical practice improvement activities. Activities must be applicable to all specialties and attainable for small practices and professionals in rural and underserved areas ©AAHCM

YearPotential reduction 2019minus 4 percent 2020minus 5 percent 2021minus 7 percent 2022 and afterminus 9 percent ©AAHCM

 Academy is conducting analysis using 2012 Medicare data to document the inadequacies of current risk adjustment and to present to CMS  Practice TINs and NPIs are required to associate claims data to document the inadequacies of current risk adjustment models; in the absence of improvement to the risk adjustment practices will appear less cost effective and be penalized  Send your TINs and NPIs to Gary Swartz  Results of analysis will be presented to CMS to modify risk adjustment  Protects your revenue in the future under VBPM and MIPS  Protects access to care for your patients and practice revenue under APMs/ACOs/bundles – application to private health plans  Contributes to the development of payment policy for the frail elderly ©AAHCM

Medicare Fee ScheduleAlternative Payment Models Post Acute Services/ Bundles Management Managed Care Population Health Management ACO/Health system/Hybrid Population Health Management ©AAHCM