Advancing Risk Capability in 2015: MACRA and 2016 Medicare Proposed Rule. May 26, 2015 // 12:00 P.M. 1:00 P.M. EST

Transcription

1 Advancing Risk Capability in 2015: MACRA and 2016 Medicare Proposed Rule May 26, 2015 // 12:00 P.M. 1:00 P.M. EST

2 Center For Industry Transformation The DHG Healthcare Center for Industry Transformation exists to provide industry leaders with intelligence to serve and advance the delivery of healthcare in the United States and across the world. Our 2015 Webinar Series is a demonstration of our commitment to our clients to provide distinctive industry commentary on the most critical reform elements impacting healthcare providers in 2015 and beyond. 2

3 Today s Presenters Trent Messick Partner, DHG Healthcare Leads the DHG Healthcare Reimbursement team serving clients in the areas of cost reports and related reimbursement engagements, appeals, feasibility studies and reimbursement analysis 20 years of experience in the healthcare industry working with hospitals, long-term care facilities, home health agencies, rehabilitation agencies and other healthcare entities Previous presenter at HFMA s Annual National Institute Melinda Hancock Partner, DHG Healthcare Responsibility for development of services pointed to the mandatory elements of payment reform (value-based purchasing, readmissions, hospital-acquired conditions), shared savings models, governmental and commercial bundled payments, and the Medicare innovation model More than 22 years of healthcare experience in the public and industry sectors A member of HFMA since 1994, Melinda s involvement has been at the National and Chapter levels in a variety of leadership positions and she is currently the National Chair-Elect 3

4 Session Goals And Objectives This session will provide an update on changes in Medicare hospital reimbursement. It will focus on the recently published FY 2016 Inpatient PPS Proposed Rule and the recently enacted Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). We will discuss changes to a variety of critical payment factors as well as what hospital leaders must do to prepare. 4

5 Agenda FY 2016 IPPS PROPOSED RULE Payment Rates Medicare DSH OTHER RECENT PROPOSED RULES MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT OF 2015 (MACRA) REFORM ELEMENTS Value Based Purchasing Readmission Reduction Penalty Hospital Acquired Conditions IQR Changes Bundled Payment for Care Improvement 5

6 FY 2016 INPATIENT PPS PROPOSED RULE 6

7 FY 2016 IPPS Proposed Rule Display copy published April 17, 2015 Published in Federal Register April 30, 2015 Incorrectly stated comments are due by June 29, 2015 Correction notice published by CMS on May 5, 2015 revised comment deadline to June 16, 2015 Final Rule expected around August 1, 2015 Effective for discharges on or after October 1, 2015 CMS FY 2016 IPPS Proposed Rule Home Page: Fee-for-Service-Payment/AcuteInpatientPPS/FY2016-IPPS-Proposed-Rule-Home- Page.html 7

8 Payment Rates FY 16 IPPS Proposed Operating Payment - Full Update Market Basket Update 2.7% Market Basket Adjustment (PPACA) -0.2% Productivity Adjustment (PPACA) -0.6% Documentation and Coding Effect (ATRA)** -0.8% 1.1% ** As part of the American Taxpayer Relief Act of 2012 Congress stipulated CMS must recoup additional $11 billion from FY FY 16 impact projected to be $3 billion. CMS expects to recoup entire $11 billion by adding.8% reduction each year will be cumulative 3.2% reduction by FY 17. CMS intended to reverse in FY 2018 and return standardized amount to pre-reduction level, but MACRA requires phase-in through

9 Payment Rates FY 16 IPPS Proposed Payment: FY 2015 Full Update Final FY 2016 Proposed Change National Adjusted Operating Standardized Amount (Full Update) $5, $5, $47.18 FY 2015 Final FY 2016 Proposed Change Capital Standard Federal Payment Rate $ $ $

10 Payment Rates FY 16 IPPS Proposed Operating Standardized Amount: Full Update 5, (1.9% increase) Hospital Did NOT Submit Quality Data 5, (.425% increase) Hospital is NOT a Meaningful EHR User 5,406,44 (-.25% decrease) Hospital Did NOT Submit Quality Data and is NOT a Meaningful EHR User 5, (-.925% decrease) 10

11 Medicare DSH No change in methodology or UCC proxy Empirical DSH is 25% UCC DSH is 75% of what would otherwise be made without ACA UCC DSH is reduced by the decrease in uninsured and then allocated to all qualifying hospitals UCC DSH proposed FFY 2016 = $6.371B (Total UCC DSH for FFY 2015 was $7.647B) UCC DSH allocation continues to be based on Medicaid days plus SSI days 11

12 Medicare DSH UCC DSH allocation data source 2012/2013 cost reports and 2012 SSI days. Proposed rule holds the data source time period from 2015 due to comments from industry Table published with Medicaid days and SSI days for every provider. Comment on any changes or short period cost reports Merged hospitals 2015 policy continued: List of proposed mergers published on CMS web site. Providers should notify CMS if list is incorrect within 60 days Mergers that occur after January 2014 will be treated as new hospitals and allocation of UCC will be recalibrated based on cost report 12

13 Medicare DSH Medicare published FY 2013 SSI file subsequent to proposed rule final FY 2016 UCC DSH amounts will be updated to reflect new SSI days per 2013 file. ACCESS THE FILE AT: Payment/AcuteInpatientPPS/Downloads/DSH-Adjustment-and File.zip 13

14 Polling Question What is the deadline for submitting comments on the FY 2016 IPPS Proposed Rule? A. June 16, 2015 B. June 29, 2015 C. August 1, 2015 D. October 1,

15 Other Recent Proposed Rules Inpatient Rehab Facilities PPS: Published April 23, % payment rate increase Comments due June 22, 2015 Inpatient Psych Facilities PPS: Published April 24, % payment rate increase Comments due June 23,

16 MEDICARE ACCESS AND CHIP REAUTHORIZATION ACT OF 2015 (MACRA) 16

17 MACRA Signed into law April 16, 2015 Not reflected in FY 2016 IPPS proposed rule Although primary focus was the elimination of the Sustainable Growth Rate (SGR) formula for physicians, several provisions impact hospitals 17

18 MACRA Extends Low Volume Payment Adjustment and Medicare Dependent Hospital (MDH) status through FY 2017, both retroactive to April 1, 2015 when they had expired Recent extensions have been tied to SGR patch legislation could be problematic now that SGR is gone? Prevents CMS from implementing expected 3.2% payment increase in FY 18 instead can only increase.5% per year from 2018 through 2023 Extends two-midnight rule provision of probe and educate program and prohibition of RAC post-payment audits through September 30,

19 MACRA Revisions to Medicaid DSH Reductions: Implemented with ACA. Due to declining uninsured rates, less DSH should be required to offset uncompensated care ACA reductions were set to begin in FFY 2014 at $500M but were delayed to FFY 2016 with Bipartisan Budget Act of 2013 Total ACA reductions $18.1B, revised to $17.6B with Bipartisan Budget Act of 2013 Protecting Access to Medicare Act of 2014 revised again. Total of $35.1B of reductions to begin in FFY 2017 and end in FFY

20 MACRA Revisions to Medicaid DSH Reductions (cont.) Changed yet again by MACRA - Delayed one more year to FFY Total reductions of $43B Reductions by year: FFY 2018 $2B FFY 2019 $3B FFY 2020 $4B FFY 2021 $5B FFY 2022 $6B FFY 2023 $7B FFY 2024 $8B FFY 2025 $8B 20

21 MACRA: Physician Payments Payment rates for will be.5% annually and then frozen and thereafter tiered.25% (MIPS participants) or.75% (APM participants). Creates MIPS: Merit-Based Incentive Payment System Starts 2019 & combines EHR incentive program, PQRS and VBPM Develops 4 categories of measures Quality, Resource Use, Clinical Improvement, & EHR Use Range of payment adjustments In 2019: -4% to +12% In 2027: -9% to +27% Program is budget neutral Allows providers in Alternative Payment Models (APMs) to opt out of MIPS and can be eligible to receive 5% lump sum bonus

22 REFORM ELEMENTS 22

23 Timeline of Performance Periods 23

24 Current State: VBP 24

25 Polling Question Value Based Purchasing is challenging to manage as an organization because: A. Domains/related metrics have changed each year B. You are in multiple performance periods at the same time C. Future years are not fully defined yet D. All of the above 25

26 Road Ahead: VBP Summary Definitions out to 2021 Tightening up and equality on domains Expansion of definitions Adding new measures Seeking input on the efficiency measure for expansion 26

27 VBP Details Amount available for FY 2016: $1,489,095 (1.75%) Two new measures introduced HCAHPS: CTM-3 for 2018 COPD Mortality for 2021 Dropping two measures and dropping the subdomain and moving the one remaining measure of PC 01 to Safety. AMI 7a is not widely reported and collection is burdensome IMM 2 is topped out Fully defined 2018 and partially defined through 2021 Changing the standard population data used for outcome metrics Expansion of infection definitions to include non-icu locations starting with This includes Medical/Surgical units. Baseline is CY 2015 and Performance Year is CY

28 CTM-3 Three questions form a composite score: 1. During this hospital stay, staff took my preferences and those of my family or caregiver into account in deciding what my health care needs would be when I left 2. When I left the hospital, I had a good understanding of the things I was responsible for in managing my health 3. When I left the hospital, I clearly understood the purpose for taking each of my medications Possible answers range from Strongly Disagree to Strongly Agree 28

29 COPD Mortality COPD is the 3 rd leading cause of death in the US and is one of the top 20 conditions contributing to Medicare costs Adopting within IQR so will be on Hospital Compare for 1 year prior to the start of the performance period as required Added to the 2021 Clinical Care Domain Performance period will be 7/1/16-6/30/19 and Baseline period will 7/1/11-6/30/14 29

30 Expansion of Efficiency Measure Invites comments on expansion of this measure with more condition and/or treatment specific episode measures Related metrics already in Hospital IQR AMI Payment, HF Payment, PN Payment Proposed related metrics already in Hospital IQR Kidney/UTI, Cellulitis, Gastrointestinal Hemorrhage and Lumbar Spine Fusion/Refusion 30

31 2018 Complete Picture 31

32 Polling Question The proposed rules have what impact on the 2018 Value Based Purchasing Program: A. All domains have equal weight B. Only one core measure left - now included in safety domain C. There is a new patient experience metric D. All of the above 32

33 FFY

34 FFY 2019 NOTE: NOT FULLY DEFINED 34

35 FFY 2020 and 2021 NOTE: NOT COMPLETELY DEFINED 35

36 HAC Summary Potential addition of three metrics to PSI-90 composite through the NQF review process: Perioperative hemorrhage rate, Perioperative physiologic metabolic derangement rate and Post-operative respiratory failure rates. Would engage in additional rule-making if so Finalization of time periods for FY 2017: Domain 1= 24 month period ending 6/30/15 and Domain 2= CY 2014 and Weights are: Domain 1=15% and Domain 2= 85% Narrative on scoring if data is not reported and a waiver is not obtained- a score of 10 will be assigned Refinements in measurements for CLABSI and CAUTI to include Non-ICU locations starting in 2018 (CY 2015 and 2016 performance periods) Exception policy/waiver for hospitals that experience disasters or other extraordinary circumstances 36

37 Hospital IQR: Removal STK-01 Venous Thromboembolism Prophylaxis* STK-06 Discharged on Statin Medication*# STK-08 Stroke Education*# VTE-1 Venous Thromboembolism Prophylaxis*# VTE-2 ICU Venous Thromboembolism Prophylaxis*# VTE-3 Venous Thromboembolism Patients with Anticoagulation Overlap Therapy*# IMM-1 Pneumococcal Immunization AMI-7a Fibrinolytic Therapy Received Within 30 Minutes of Hospital Arrival SCIP-Inf-4 Cardiac Surgery Patients with Controlled Postoperative Blood Glucose *Topped Out # Topped Out but Retaining in Electronic Form 37

38 Expansion of Pneumonia Expansion to include principal diagnosis of aspiration pneumonia, sepsis and respiratory failure with a secondary diagnosis of pneumonia present on admission Retrospective analysis on FY 2015 Mortality shows: Expansion would include an additional 686,605 patients bringing the total to 1,663,195 patients An additional 86 hospitals would meet the min case requirement 41% of the cohort would consist of these expanded definitions Retrospective analysis on 2015 Readmissions shows: An additional 670,491 patients for a total of 1,765,450 patients An additional 67 hospitals would meet the min case requirement 38% of the cohort would consist of these expanded definitions 38

39 Hospital IQR: Additions Hospital Survey on Patient Safety Culture (structural) Kidney/UTI clinical episode payment Cellulitis clinical episode payment Gastrointestinal Hemorrhage clinical episode payment Lumbar Spine Fusion/Re-Fusion clinical episode payment Hospital-Level, Risk Standardized Payment Associated with an Episode of Care for Primary Elective THA/TKA Excess Days in Acute Care after hospitalization for AMI Excess Days in Acute care after hospitalization for HF 39

40 Polling Question Which of these statements are true about the hospital mandatory elements of reform: A. All programs expand the population included in programs B. VBP only has proposed metrics in play through 2018 C. Opt out reporting infections for HAC without repercussion D. A and C 40

41 Expansion of BPCI Solicited comments for expansion of the program in defined categories. The Secretary has the authority to expand through rulemaking if the program is found to either: (1) reduce Medicare spending without reducing quality OR (2) improve quality of patient care without increasing spending. This evaluation is implied to be underway and therefore CMS is seeking input on the expansion if the criteria are met. 41

42 Comments on BPCI They are seeking comments specifically on: Breadth and Scope of an expansion Episode Definitions Models for Expansion Roles of an organization and relationships necessary or beneficial to care transformation Setting bundled payment amounts Mitigating risk of high cost cases Administering bundled payments Data needs Use of health information technology Quality measurement and payment for value 42

43 Contact Us Craig Anderson, Sr. Principal DHG Healthcare Hudson, OH P: Trent Messick Partner DHG Healthcare Winston-Salem, NC P: Melinda Hancock Partner DHG Healthcare Richmond, VA P: