LTC Division Webinar Accountable Care Organizations and LTC Pharmacy - The New Era in Health Care Delivery

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1 LTC Division Webinar Accountable Care Organizations and LTC Pharmacy - The New Era in Health Care Delivery 1

2 The Pioneer ACO Model James Vasquenza Jr. Vice President, Preferred Provider Network, Innovatix John Jordan Senior Director, Long Term Care Pharmacy Services Innovatix What s an ACO? The Affordable Care Act (ACA) incorporated a concept that some health reform proponents have advocated for several years: an Accountable Care Organization (ACO). An ACO is a group of health care providers, such as physicians and hospitals, that work together to manage and coordinate care for a group of patients across the entire spectrum of care for those patients and accept responsibility for the quality and cost of that care. The goal of coordinated care is to ensure that patients, especially the chronically ill, get the right care at the right time, while avoiding unnecessary duplication of services, controlling costs and preventing medical errors. When an ACO succeeds in both delivering high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the Medicare program. 2

3 A Few Facts Quality Care Achieved through Performance Measures Voluntary Provider Participation Beneficiaries Assigned, not Enrolled Payment Incentives to Contain Cost and Improve Care ACO: Controlling entity and a related set of providers that agree jointly to be held accountable for the cost and quality of care delivered to a defined patient population over time and across all care settings. Local Provider Accountability for Quality and Efficiency ACO Incentives and Implications Coverage Access Providers/ ACOs ACOs have financial incentives to focus on therapy selection and adherence as tools to avoid more costly services. Implications: Increased utilization of services/products aimed at managing chronic diseases and those with data to support outcomes. Value proposition and accessibility are key for any provider seeking access to ACO patients. Implications: Providers must communicate value of products/services and understand conditions ACOs emphasize. Value through cost-effective care. Cost containment through outcomes-based decisions. Implications: ACOs driven to risk-based relationships with providers. Consumers Emphasis on efficiency with less resources impacts customer access to a provider s products/services. Implications: Incentives alter utilization. 3

4 What is the Pioneer ACO Model? The Pioneer ACO Model was designed specifically for organizations with experience offering coordinated, patient-centered care, and operating in ACO-like arrangements. The selected 32 organizations were chosen for their significant experience offering this type of quality care to their patients along with other criteria required by CMS. These organizations were selected through an open and competitive process from a large applicant pool that included many qualified organizations. What is the Pioneer ACO Model? (cont.) Duration : In the Pioneer Program, providers must commit to three oneyear performance periods, although they may be given an extension of two years if they meet certain savings and quality criteria. Assignment: In the Pioneer Program, an ACO can choose either prospective or retrospective assignment. For benchmarking purposes, A prospective assignment would be based on the prior three years of claims weighted at 60 percent (most recent), 30 percent, and 10 percent. Quality measures: Both programs have 33 quality measures in four categories: patient/caregiver experience, care coordination/patient safety, preventive health, and at-risk populations. 4

5 What is the Pioneer ACO Models goal? Show how particular ACO payment arrangements can best improve care and generate savings for Medicare. Test alternative program designs to inform future rule making for the Medicare Shared Savings Program. The Pioneer Model will provide ACOs successful in achieving shared savings in the first two years the opportunity to move into a population-based payment in year three. The Pioneer Model will also require participating ACOs to engage in similar arrangements with commercial and other payers. States with Pioneer ACOs CA (6) NV CO MN (3) IA WI IL IN MI (3) NY PA ME VT NH MA 5 AZ NM No Medicare ACOs AK TX (2) FL Pioneer ACOs HI PR Source: CMS Medicare Shared Savings Program website: Payment/sharedsavingsprogram/index.html?redirect=/sharedsavingsprogram/. 5

6 More Medicare ACO Facts Minimum Number of Beneficiaries 15,000; 5,000 for rural ACOs Upside/Downside Risk Upside and downside risk Payment Model FFS + Shared Savings with transition to population-based payment Shared Savings/Losses Potential Increased percentage of shared savings and losses Beneficiary Assignment Choice of prospective or retrospective alignment How could this affect LTC Pharmacies? New ways of sharing and tracking electronic patient information. ACOs will eventually create their own formularies. High probability that reimbursement may change to a non fee for service methodology such as capitation, per diem or case rates. ACOs will want to use pharmacies that have the infrastructure to share information as well as demonstrate high quality of management and cost savings. 6

7 ACO Information and Contact List for-service- Payment/sharedsavingsprogram/Downloads/A CO-Contact-List.pdf Questions 7

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