Accountable Care Organizations

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1 Building a Healthy ACO Compliance Program HCCA 2014 Compliance Institute Mary C. Malone, Esq. Hancock, Daniel, Johnson & Nagle, P.C. Disclaimer: The content of this presentation does not constitute legal advice. 1 Accountable Care Organizations In CMS s words: ACOs are voluntary groups of physicians, hospitals, and other health care providers that are willing to assume responsibility for the care of a clearly defined population of Medicare beneficiaries attributed to them on the basis of patients use of primary care services. Donald Berwick, Administrator of CMS New England Journal of Medicine Making Good on ACOs Promise 2 Accountable Care Organizations Private Payer Model: Insurance carriers have a history of offering ACO-type models of care to private insurance markets Medicare Model: Pioneer The first experimental model that placed participants at higher financial risk if Medicare savings goals were not realized. MSSP Reduces the amount of financial risk for ACOs. Many providers that started in the Pioneer program are switching to the MSSP. Advanced Payment Selected MSSP ACOs can apply for this special payment program that pays ACOs for projected savings to help with fixed and variable start-up costs. 1

2 3 The MSSP The Centers for Medicare & Medicaid Services (CMS) established the Medicare Shared Savings Program to facilitate coordination and cooperation among providers to improve the quality of care for Medicare Fee-For-Service (FFS) beneficiaries and reduce unnecessary costs. The Shared Savings Program will reward ACOs that lower their growth in health care costs while meeting performance standards on quality of care and putting patients first by sharing a portion of the savings. Legal Backdrop MSSP Accountable Care Organizations Affordable Care Act Section Enacts Section 1899 of the Social Security Act establishing the Medicare Shared Savings Program. 4 Code of Federal Regulations - Part 425 outlines the regulations implementing the requirements for ACOs participating in the Medicare Shared Savings Program. Other Laws Applicable to ACOs - Anti-Trust Statutes; - Anti-Kickback Statute; - Stark Law; - Civil Monetary Penalties; - False Claims Act; and - State Specific Laws. See Attachment 1:Checklist of MSSP ACO Requirements 5 The Triple Aim Lower Growth of Expenditures Better Health for Populations Better Care to Individuals Successful ACOs will be rewarded with a slice of the shared savings pie. 2

3 6 ACO Program Integrity Although not specifically required by the ACA, CMS enacted several program integrity requirements for MSSP ACOs. For example: ACO must have a compliance plan and official. ACO must maintain ultimate responsibility for compliance with the ACO agreement. All contracts or arrangements between or among the ACO and its participants must require compliance with the ACO s participation agreement as well as other laws. 7 ACO Program Integrity ACO governing body must adopt a conflicts of interest policy that applies to members of the governing body. ACOs must adopt screening procedures for participants (program integrity history, sanctions, affiliations with excluded individuals, etc.). This is consistent with current Medicare regulations prohibiting payment to individuals excluded from federal health programs. 8 Mandatory Compliance Plans Along with other program integrity requirements, CMS finalized regulations for Mandatory ACO Compliance Plans (42 C.F.R (a)). Generally, the elements required for ACO compliance plans are similar to the elements outlined by the OIG for other individual provider types (i.e., hospitals, nursing facilities, small physician groups, home health and ambulance suppliers). 3

4 9 Mandatory Compliance Plans ACOs can use existing guidance to anticipate CMS s and the OIG s expectations. Compliance guidance documents are available on the OIG s Website: ACOs can also refer to the Final Rule for CMS s comments on the elements of an effective ACO compliance plan. 10 Mandatory Compliance Plans Over the years, the government has used the terms compliance plan and compliance program interchangeably. The term compliance plan seems to describe the document that sets forth the general framework of a compliance program; whereas, the compliance program is the operationalized compliance plan (i.e., a living, breathing part of the organization). CMS requires ACOs to have a compliance plan, although more likely, the expectation is that the ACO have a fully implemented, operational, dynamic, and effective compliance program 11 ACO Compliance Plan Does your ACO Compliance Plan contain all of the elements? There is one question on the ACO Application about compliance plans. When completing the ACO MSSP Application, an ACO must attest that it has a compliance plan in place that meets the minimum requirements. See Attachment 2: Sample ACO Compliance Plan 4

5 12 ACO Compliance Plan Here is what the attestation looks like on the ACO application. NOTE that ACOs are not required to submit a copy of the compliance plan with the application, but must make it available to CMS upon request. Image captured from 2013 MSSP Application 13 The Elements of an Effective ACO Compliance Plan (42 C.F.R (a)) 1. Designated compliance official who is not legal counsel to the ACO and reports directly to the ACO s governing body Legal counsel to the ACO and the compliance officer must be different individuals, in order to ensure independent and objective legal reviews of financial analyses of the organization s compliance efforts and activities by the compliance officer. ACOs may use their current compliance officer provided that the compliance officer is not legal counsel to the existing organization. 14 The Elements of an Effective ACO Compliance Plan (42 C.F.R (a)) 2. Mechanisms for identifying and addressing compliance problems related to the ACO s operations and performance ACO compliance officials must ensure that policies and procedures adequately define how ACO participants can report potential compliance and quality issues so that the compliance officer can take steps to investigate or audit ACO activities. This also includes collecting and reporting on various quality measures. There are currently 33 such measures. 5

6 15 The Elements of an Effective ACO Compliance Plan (42 C.F.R (a)) 3. A method for employees or contractors of the ACO, ACO participants, ACO providers/suppliers, and other individuals or entities performing functions or services related to ACO activities to anonymously report suspected problems related to the ACO to the compliance officer Compliance plans on their own do not stop fraud and abuse; however, compliance programs provide a resource for: Increased likelihood of identifying and preventing unlawful and unethical conduct; Providing a centralized source for distributing information on health care statutes, regulations, and other program directives related to fraud and abuse; and Creating an environment that encourages employees and others to anonymously report potential problems. 16 The Elements of an Effective ACO Compliance Plan (42 C.F.R (a)) 4. Compliance training for ACO, ACO participants and the ACO providers/suppliers. Requiring compliance training for the ACO and all of its ACO participants and ACO providers/suppliers helps to ensure that every ACO participant, ACO provider/supplier, and contractor understands their legal obligations with respect to the ACO s operations and performance, as well as the requirements of the compliance program and the manner in which their ACO is implementing such requirements. 17 The Elements of an Effective ACO Compliance Plan (42 C.F.R (a)) 5. A requirement for the ACO to report probable violations of law to an appropriate law enforcement agency. The OIG has outlined industry best practices for compliance programs as well as a description of the risks of fraud and abuse that various providers may face. CMS suggests that providers without experience developing compliance programs review the various resources that are available from the OIG s web site to help determine the risk of fraud and abuse in the ACO and when an activity may rise to the level of a violation that may need to be reported. CMS encourages the use of the OIG Self-Disclosure Protocol to determine which activities amount to a probable violation. 6

7 18 ACO Pre-Participation Waiver Protections against the AKS, Stark and Gainsharing CMP. ACO Participation Waiver Protections against the AKS, Stark and Gainsharing CMP. Shared Savings Distribution Waiver Protections against the AKS, Stark and Gainsharing CMP. Compliance With Stark Exception Waiver Protections against the AKS and Gainsharing CMP. Patient Incentives Waiver Protections against the AKS and Beneficiary Inducement CMP. 19 Pre-Participation Waiver Protections begin in the year preceding the ACO s target year of Participation. Only one party to the financial arrangement must be an ACO or ACO participant. However, the party cannot be a DME Drug/Device, or Home Health Supplier The ACO Governing Body must make a bona fide determination that the financial arrangement is reasonably related to the MSSP s triple-aim. Parties must maintain adequate documentation for the financial arrangement including the diligent steps toward becoming an ACO by the selected target year. See Attachment 3A: Pre-Participation Flow Chart 20 Participation Waiver Protections are available to ACOs that are in good standing under an ACO participation agreement. Only one party to the financial arrangement must be an ACO or ACO participant. The ACO Governing Body must make a bona fide determination that the financial arrangement is reasonably related to the MSSP s triple-aim. Parties must maintain adequate documentation for the financial arrangement. See Attachment 3B: Participation Waiver Flow Chart 7

8 21 Shared Savings Distribution Waiver Protections are available to ACOs that are in good standing under an ACO participation agreement. Protects financial disbursements of earned shared savings. Disbursements can be made at any time as long as the savings were earned during the term of the ACO s participation agreement Disbursements can be made to: Current ACO participants, providers and suppliers; Individuals or entities that were ACO participants, providers or suppliers during the year that the shared savings were earned by the ACO; or To other parties if their activities are reasonably related to the MSSPs triple-aim. Disbursements from hospitals cannot be intended to prevent physicians from referring patients for medically necessary services. See Attachment 3C: Shared Savings Distribution Waiver Flow Chart 22 Compliance with Physician Self-Referral Waiver Protections are available to ACOs that are in good standing under an ACO participation agreement. The financial arrangement must be reasonably related to the MSSP s triple-aim. The financial arrangement must fit into one of the Stark Law s current exceptions (42 C.F.R through ). See Attachment 3D: Compliance With Physician Self-Referral Flow Chart 23 Patient Incentives Waiver Protections are available to ACOs that are in good standing under an ACO participation agreement. ACOs and ACO participants, providers and suppliers may offer items or services for free or below market value to Medicare beneficiaries. Items and services must be in-kind. NO CASH INCENTIVES Items and services must be meant to promote preventative care or the advancement of patient care goals. See Attachment 3E: Patient Incentives Waiver Flow Chart 8

9 24 ACOs can enjoy broad applicability of Waivers to financial arrangements with non-aco participants. Activities Reasonably Related to the MSSP s Triple-Aim can qualify for Waiver protections. Only one party to most agreements must be an ACO or ACO participant. In many cases, Waiver protections will not be triggered because the arrangement fits within an existing exception or safe harbor. 25 CMS has indicated that it is willing to consider additional Waivers as ACOs begin to offer services to beneficiaries. May include ability to offer cash incentives for beneficiary participating in preventative health screenings. Waivers may need to be expanded to pre-empt applicable state fraud and abuse laws. However, there is no guarantee that the CMS or the OIG will not tighten the Waiver requirements as time goes on. 26 Conflict of Interest for ACOs MSSP requires 75% of the ACO s Board to be ACO Participants. This means that board members will also have financial interests in the operation of the ACO. MSSP requires disclosure of Conflicts of Interest. Conflict of interest policy must: Provide for disclosure of financial interests; Create procedure for identifying and addressing conflicts; and Establish remedies for violation of policy. See Attachment 4: Sample Conflict of Interest Policy 9

10 27 Other ACO Compliance Functions Adhering to Marketing Limitations 42 C.F.R Complying with Patient Engagement Requirements 42 C.F.R Ensuring Freedom of Choice 42 C.F.R (c) Proper Record Management and Retention 42 C.F.R Protecting Privacy of Patient Data (HIPAA) 42 C.F.R et seq. Appropriate Billing and Coding 42 C.F.R (b) The ACO must agree, and must require its ACO participants, ACO providers/suppliers, and other individuals or entities performing functions or services related to the ACO's activities to agree, or to comply with all applicable laws. 28 CMS Monitoring of ACOs ACO compliance plans should include policies and procedures for proactive internal audits to ensure that all 5 elements of the compliance plan are effective. This means that compliance officials should have access to all patient charts and medical records to confirm quality and utilization information. Consider the use of integrated EHR and other centralized electronic communications systems for consistent data collection. Compliance Officers must be able to identify and correct deficient practices before issues become sanctionable non-compliance. 29 CMS Monitoring of ACOs WHEN not IF CMS has indicated that ACOs will be audited through: Analysis of financial and quality measurement data reported by ACO; Site visits; Beneficiary and provider complaints; and Claims analysis, chart reviews, beneficiary surveys, and coding audits. Because CMS will be auditing ACO activity, it is important that ACOs implement their compliance plans early, self-audit often, and revise policies periodically. 10

11 30 If an ACO is comprised of participants that have never operated under a compliance plan, compliance program development should start with a Readiness Assessment. If an ACO is able to leverage an ACO participant s existing compliance program, compliance program development should start with a Gap Analysis. 31 Compliance Program Readiness Assessment A Readiness Assessment should focus on the ACO s and ACO participants infrastructure to ensure that all ACO participants start on equal footing in the compliance program. Factors to consider: Teamwork; participant buy-in; and current business cultures Technologies; EHR compatibility; and communication systems Costs and charges 32 Compliance Program Gap Analysis should focus on the ACOs current compliance needs and resources and how they compare to the best practice. Best practice may be difficult to assess at this early stage but, some factors to consider include: Quality Assurance Data Collection Practice Billing and Coding Compliance Clinical Integration Patient Engagement Efforts Reporting Obligations (public reporting and CMS reporting) 11

12 33 Create an Action Plan For each item that is identified as a shortcoming during the Readiness Assessment or Gap Analysis, create an Action Plan. Start with 5 to 10 shortcomings that need to be addressed. Create step by step goals and dates to implement a procedure to correct each shortcoming. Monitor and track the goals to ensure that the tasks are accomplished. Share accomplishments or deficiencies during regular compliance meetings. Once all goals on the Action Plan have been complete, replace the task with another shortcoming from the Readiness Assessment or Gap Analysis until all shortcomings have been addressed. 34 The Importance and Role of the Compliance Officer Create a Culture of Compliance Actively develop an organizational structure that supports compliance activities Individuals should be comfortable participating with compliance activities, including reporting potentially non-compliant activities without fear of retaliation from the governing body 35 The Importance and Role of the Compliance Officer Integrate Care and Communication Open communication among all ACO participants, management and governing body allows the compliance officer to manage potential risks in real time, which is essential to preventing systemic compliance deficiencies. 12

13 36 The Importance and Role of the Compliance Officer Develop Training and Education Programs The importance of training and education programs cannot be stressed enough. Experience shows that ACO compliance officers can use training to gauge whether the ACO is accomplishing its compliance goals. For MSSP ACOs, training and education programs are required as conditions of participating in the MSSP. ACOs that fail to educate all levels of the ACO organization, including the governing body, will likely see the compliance program s efficacy diminish over time. 37 Collaboration with Risk Managers and ACO Executives In some organizations compliance officers are incorporated into the overall management hierarchy and are highly integrated with the governing body. In other organizations the compliance officer is almost completely isolated from the governing body but more in touch with ACO staff and participants. The goal is to strike the right balance. Participants need to trust the compliance officer, but the compliance officer must also maintain support from the governing body. 38 Participant Buy-In When approaching an independent physician group, the group must understand what the benefits are of giving up their autonomy and buying in to ACO compliance oversight. Those benefits are: Assuring that care is medically necessary; Removing obstacles/distractions to the provision of care; and Assuring that coding is accurate for purposes of fully and accurately representing the care that was delivered. Buying into the ACO compliance program must also make good cents. The ACO must demonstrate to all participants, including clinicians, the benefits of being a participant in a larger organization compliance program. Increased billing and coding efficiency; Decreased claims denials; Faster payments; Reduced fraud and abuse liability exposure for improper billing; and Increased trust and confidence in the patient community. 13

14 39 Predictions for the Future of ACO Compliance Plans Litigation Issues Because of the loose language used in many of the ACO regulations (i.e., reasonably related, bona fide determination, etc.), there is ample opportunity for CMS and the OIG to interpret and reinterpret how ACO s should operate. Litigation may include: Waiver applicability; Participation Agreement obligations; and Individual provider fraud and abuse liability. 40 Predictions for the Future of ACO Compliance Plans Waiver Evolution CMS will evaluate the need to reduce or expand Waiver protections as ACOs and the MSSP program evolves. One definite hurdle for the near future is the fact that the Waivers do not operate to pre-empt applicable state fraud and abuse laws. For example, compliance with the federal ACO Participation Waiver rules does not automatically assuage an ACO s obligations to comply with state physician anti-kickback statutes (i.e., Virginia False Claims Act (Va. Code et. seq.) and Antikickback Statute (Va. Code )). 41 Predictions for the Future of ACO Compliance Plans How much will Compliance Cost? It is likely that many providers entering into compliance plans for the first time will have to devote a great amount of resources to aligning themselves with partners that can provide compliance program training and tools. Will shared savings be enough to make the expenses worth it? Audits of the ACO will likely cause greater scrutiny on individual providers. What will the cost be for those participants when audits reveal compliance deficiencies for time periods predating the ACO participation agreement and compliance plan implementation? 14

15 42 We are in this together. ACOs are all in the same boat trying to figure out how to operationalize an effective compliance program. This is also new territory for CMS. By using the existing guidance and CMS s comments in the final rules, ACOs can at least anticipate CMS s compliance expectation and begin to adopt policies and practices that minimize ACO compliance risks. 43 Questions Mary C. Malone, Esq., Shareholder Hancock, Daniel, Johnson & Nagle, P.C 15

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