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Modern Relationships Between Physicians, Hospitals, and Long-Term Care Providers in a Time of Risk-Based Contracting

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PYA, P.C.
PYA, P.C.

PYA Consulting Manager Aaron Elias co-presented “Modern Relationships Between Physicians, Hospitals, and Long-Term Care Providers in a Time of Risk-Based Contracting,” along with Jeanna Palmer Gunville, a shareholder at Polsinelli.

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Modern Relationships Between Physicians, Hospitals, and Long-Term Care Providers in a Time of Risk-Based Contracting Aaron Elias PYA PC Jeanna Palmer Gunville Polsinelli PC
Jeanna Gunville, Shareholder, Polsinelli PC – Outside general counsel for regulatory and transactional matters – Alignment strategies between hospitals and health systems and post-acute care providers including clinically integrated networks, accountable care organizations, and joint ventures – Pay-for-performance initiatives, shared savings programs, and bundled payments Presenter Introduction
Aaron Elias, Manager, PYA PC – Healthcare consultant for value-based payment and delivery models – Selection and implementation of alternative payment models, including pay-for-performance initiatives, shared savings programs, and bundled payments – Population health management initiatives, including ambulatory care management programs Presenter Introduction
Overarching Goals • Understand the changing reimbursement landscape for healthcare providers. • Understand the spectrum of options to advance value-based care (alternative payment models). • Review network formation and strategic partnerships as a means to thrive in new payment models.
Let’s talk about… • Key considerations when supporting initiatives between acute and post-acute care providers for success in risk-based contracts. – Factors driving a higher degree of partnership among providers – Recent regulatory changes impacting compensation and data sharing – Example relationships between acute and post-acute care providers (e.g., existing APMs like BPCI Advanced or ACOs) – Legal/valuation aspects and things to consider
Let’s talk about… • Practical steps to move your organization forward. • How can long-term care providers make economic and clinical value arguments that appeal to consumers, payors, employers, and others that could engage them in value-based payment models? • Timing and deadlines for governmental APMs and development of plans for clinical integration across providers.
VALUE-BASED PAYMENT FUNDAMENTALS
Value-Based Payment Fundamentals • “Value-based” healthcare: – Healthcare delivery and payment models involving financial and other incentives to ensure patients receive appropriate, high-quality care to increase the overall “value” of that care – Care delivery and financial incentives linking fee-for- service payments to care quality and “value” – Examples: • Pay-for-performance • Episodes of care and population health • Shared savings and risk • Linkage to “quality” • Hospital Value-Based Payment Program • Physician Quality Payment Program/MACRA
Value-Based Payment Models • Fee-for-Service • Pay-for-Coordination • Pay-for-Performance • Upside Shared Savings • Downside Shared Savings • Bundled Payment (Episode Based) • Partial/Full Capitation • Global Budget FinancialRiskto Providers/ParticipantsLeast Most
Alternative Payment Models A public-private partnership established to accelerate transition in the healthcare system from a fee-for-service (FFS) payment model to ones that pays providers for quality care, improved health, and lower costs.
Trends in APM Adoption Medicare APM Participants
Value-Based Payment Fundamentals • Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). SSA Section 1848(q) – Enacted April 2015 (bi-partisan support) – Final rule published November 4, 2016 • MACRA’s Major Changes: – Repealed Sustainable Growth Rate – Modifies/consolidates Medicare quality programs (Meaningful Use, PQRS, Value Based Modifier) – Continues fee-for-service payments, but with potential payment adjustments via: • “Merit-Based Incentive System” (MIPS) • “Alternative Payment Models” (APMs)
Trends in APM Adoption Medicare APM Participants Source: Health Affairs. Recent Progress In The Value Journey: Growth Of ACOs And Value-Based Payment Models In 2018
Value-Based Payment Fundamentals • CIN = Clinically Integrated Network • ACO = Accountable Care Organization • Often used interchangeably, but may differ in scope depending on the purpose of the network. • Both are a means to participate in alternative payment systems (both commercial and CMS). • Examples: MSSP, Pioneer ACO, Next Generation ACO, also commercial bundled payment programs
A Snapshot of the Provider Transition to Value-Based Care Need reliable and timely data on cost, quality, clinical decision support, etc. Must make investments in health management infrastructure (e.g., IT, clinical teams) Compensation must align with payments Manage pace of transition Know your patient population Engage patients as consumers Find the right partner(s) Manage multiple payors The list goes on…
RECENT REGULATORY CHANGES
Recent Regulatory Changes • Medicare Shared Savings Program (MSSP) authorized by Affordable Care Act in 2010 • Authorized Medicare “Accountable Care Organizations” and CMS Innovation Center • 2012 first performance year for SSP ACOs • Jan. 2018 – 561 ACOs, serving 10.5M Medicare beneficiaries: – Track 1 – Shared savings upside only 460 ACOs – Track 1+ – Shared losses 55 ACOs – Track 2 – Shared losses 8 ACOs – Track 3 – Shared losses 38 ACOs • CMS observations/perceptions: – Some Track 1 models increased costs to Medicare – Tracks 2 and 3 have shown savings to Medicare and are improving quality – “Low revenue” ACOs (typically physician practices and rural hospitals) outperform High revenue ACOs (typically involving hospitals with more than 100 beds) – Mixed historical results; need to migrate to risk
Recent Regulatory Changes Major Changes in the MSSP Final Rule - 83 Fed. Reg. 67816 (Dec. 31, 2018) • 5 year participation agreement; July 1, 2019, or Jan. 1 start dates • “Basic” and “Enhanced” Tracks • Shared savings opportunity (linked to quality) and loss obligations • Election/mandatory migration to higher level and risk • Low Revenue, High Revenue, Initial, Re-entering, and Experienced ACOs • Beneficiary assignment methodology – annual choice • Payment system waivers – Telehealth and 3 day SNF waivers • Beneficiary incentives
MSSP ACO Participation Tracks
Recent Regulatory Changes BPCI-Advanced Program • Additional voluntary Advanced APMs • Hospital or physician group practice initiates the bundle • All providers get Medicare FFS rates • Participants will likely seek to achieve savings by changing PAC patterns, and by controlling claims made to Medicare (i.e., shortening SNF days, but balancing against risk of hospital readmission) • The BPCI-A entity (hospital or physician group practice) receives a check from CMS for the savings
Recent Regulatory Changes BPCI-Advanced Program • Participants can waive the 3-day inpatient stay requirement to access skilled nursing facility care • Final gain share is contingent on quality performance; therefore, there is caution to discharge patients to a home setting (e.g., assisted living or other long-term services and supports setting) if there is any concern that the person will be readmitted to the hospital • Performance on hospital readmissions plus 6 other measures determines how much of any savings participants keep
Recent Regulatory Changes BPCI-Advanced Program • Impact on PAC service delivery: – Care substitutions to reduce cost of care for an episode, such as bypassing skilled nursing facilities and sending patients directly from the hospital to the home, with or without home health care – BPCI-A participants will choose to send patients to SNFs that can demonstrate shorter lengths of stay and reduced hospital readmissions – New care transition and care management protocols – Better access to providers at the SNF or assisted living facility, or to support home health providers in order to avoid unnecessary hospitalizations
Growth in Medicare Advantage • Medicare Advantage – Plans are offered by private companies approved by Medicare – More than 20 million Medicare beneficiaries (34%) are enrolled in Medicare Advantage plans in 2018 – Share of Medicare beneficiaries enrolled varies by state from 1%-40% – Full capitation – Transparency with data is key – Opportunities for non-skilled in-home care – Post-acute providers need to move quickly into this space
Recent Regulatory Changes • SNF Quality Reporting Program – Requires SNFs to submit patient assessment data (MDS 3.0) – Failure to submit = 2% cut to Annual Payment Update • SNF Value-Based Purchasing Program – SNF 30-Day All-Cause Readmission Measure – 2% withhold re-distributed based on performance • Nursing Home Compare • Patient Driven Payment Model – October 1, 2019 – Shift from therapy services volume to reimbursement based on patient’s condition (primary diagnosis) at admission and successive care needs
Recent Regulatory Changes New CMS Decisions Have a Dramatic Impact on Post- Acute and SNF Reimbursement • Cannot be APMs on a stand alone • Cannot be Primary Risk Takers • Can partner with Hospital APMs and Physician Group APMs to help those entities manage risk • This will lead to expansion of Episode of Care Deals
Healthcare in 2019 Looking ahead . . . • HHS Secretary Alex Azar has reaffirmed the role of the Innovation Center, and opened the door to future mandatory programs. – “I believe that we need to be able to test hypotheses… if to test a hypothesis there around changing our healthcare system, if it needs to be mandatory as opposed to voluntary to get adequate data, then so be it.” • CMS Administrator Seema Verma – Recent emphasis on patient centric solutions, access to records, and pricing transparency.
Healthcare in 2019 • Recent Health and Human Services and CMS Requests for Information regarding removing barriers to value-based care in various laws • Industry players submitted comments – Fraud and abuse waivers for value-based arrangements similar to those used in the Medicare Shared Savings Program (MSSP) – Changes to FMV requirements and Advisory Opinion process – Creation of value-based exceptions – Ability to share technology/infrastructure • Part of Agency’s “regulatory sprint” to coordinated care
Healthcare in 2019 • What might the future hold? – ACO Improvements Act – 116th Congress – CMMI Direct Provider Contracting models on horizon – Medicare Advantage benefits – Regulatory alignment and consistency at state level – Shared savings offerings in commercial plan design and TPA support – Provider incentives – Capital, innovation and infrastructure (i.e., Private Equity; super MSO) – Transparency and beneficiary incentives – Will employers go directly to providers?
Healthcare in 2019 • Continued growth in commercial value-based payment programs – Tend to mirror CMS programs, especially BPCI, and concentrate on high cost procedures – Humana recently expanded an orthopedic bundled payment model for hip and knee replacements to a total of 13 states (to Alabama, Florida, Georgia, Illinois, Louisiana, Mississippi, and Texas from Ohio, Tennessee, Indiana, Kentucky, North Carolina, and Virginia) • Payors as providers? – The lines between payor and provider continue to blur
RELATIONSHIP OPTIONS IN VALUE- BASED PAYMENT MODELS
All Over the Headlines
Relationship Options in Value-Based Payment Models • Medicare-patient continuum – Hospital  SNF  Home/community (with or without HHA) – Hospital  SNF  Home with HHA  Home – Hospital  Home with HHA  Home – Hospital  Assisted Living with HHA  Home
Relationship Options in Value-Based Payment Models • ACO transformation of Post-Acute Care • PAC providers like SNFs, ALFs, and Home Health Care will need to determine how they want to engage with acute, ACO, or physician partners • Examine the model or program • Understand the payor incentives under the program • Pressure to become a preferred provider
Relationship Options in Value-Based Payment Models • SNF Roles in this Environment 1. Efficient downstream provider; provide high quality services but at an arm’s length to hospitals (past) 2. Preferred collaborator; favored partner for risk- taking hospitals (now) 3. Risk partner; SNF shares in payment risk with hospital and takes an active role in risk management for patients ((near) future)
Relationship Options in Value-Based Payment Models • Traditionally SNFs have served the entire community and whole spectrum of short-term/high acuity to long-term/low acuity and of Medicare, private, and Medicaid payors • Some SNFs shifting to focus on short-term/high acuity and Medicare/private pay only • Reasons: – Patient choice – Baby Boomers want “spa” experience for rehab – Specializing in high acuity care may be necessary to attract hospital partners (including ACO participation) – Medicare is far more lucrative, but will need high volume of short- term admissions
LEGAL CONSIDERATIONS AFFECTING ALIGNMENT STRUCTURES AND CINS
Legal Considerations • Physician Self-Referral Law (“Stark” Law) – Prohibits physician referrals for designated health services (“DHS”) to entities with which the physician has a financial relationship, unless an exception applies. • Anti-Kickback Statute • Prohibits offering, soliciting, providing, or receiving remuneration in exchange for referral of Federal health care program business. • Civil Monetary Penalties Law – Prohibits offering or providing remuneration to Federal health care program beneficiaries that is likely to influence beneficiary’s choice of provider. – Prohibits hospital from knowingly making (or physician from knowingly receiving) a payment to a physician to reduce or limit medically necessary services for Federal health care program beneficiaries. Implicated by physician financial and referral relationships, hospital incentives/payments to reduce care, and beneficiary inducement
Legal Considerations • Antitrust – Market Concentration and Integration Implicated by impact on competition by too many providers/exclusivity in the market or joint action by competitors without integration • Tax Exempt Organizations Implicated by use of charitable assets for private inurement, private benefit; excess benefit transactions • Health Insurance Portability & Accountability Act – Restricts use of protected health information without patient consent, except in limited circumstances Implicated by sharing of patient information and restricted records
Legal Considerations Other Legal Issues • State fraud and abuse laws and fee splitting prohibitions • Corporate practice of medicine, licensure, and liability concerns (choice of entity and entity activities) • Business of insurance and insurance risk • Peer review and protections • State/local tax exemption requirements
Legal Considerations • “Traditional” Medicare compliance concerns (e.g., False Claims Act, attestation, fraud, and abuse, etc.) – Ensure that bonuses or performance incentives tied to quality metrics stay within FMV • APM Participation: – Broad waivers available for MSSP participants, and narrow program specific waivers for Innovation Center programs (like BPCI) – Commercial APMs: Not well defined how enforcement will occur – Multiple Stark exceptions may apply: Professional Service/FMV compensation; Risk share exception
Legal Considerations • Structure participating provider agreements are consistent with regulations/CMS awardee contract. • Waivers are available if guidance is strictly followed. • Distribution of savings to participating providers implicates fraud and abuse laws and regulations.
Legal Considerations Compliance Considerations • With the high volume of data that will be produced to the government for payment, expect increased scrutiny of that data for accuracy. • Providers can expect contractors to monitor and test quality data. • All metrics should be clear and benchmarked against actual performance. Beware overlapping payments. • False certification claims can be based upon attestations to accuracy of data. • Focus on the accuracy of diagnosis coding and documentation which is used to risk adjust capitated payments.
PRACTICAL STEPS FORWARD
Practical Steps Forward • Value Based Contracting is the future – all lines of business • Uncertainty in the market – ACA, payment reform, and payment cuts • New healthcare delivery methods for new payment models = new compliance risks
Practical Steps Forward • Self-assessment for market and aims • Identify key partners • Determine where to focus resources • Know your data • Engage in smaller initiatives and scale up • Get to know fellow long term care providers in your area • Consider engagement in a network
Demonstrate Economic and Clinical Value
Demonstrate Economic and Clinical Value Data Points to Monitor: • Overall budget to actual comparisons • Actual to expected comparisons for utilization and unit cost • Evaluation of progress toward goals for specific initiatives • Achievement of quality measure targets • Detailed analysis by primary care physician • Patient satisfaction • Provider recruitment
Demonstrate Economic and Clinical Value • Include home health services, telehealth, or a lower cost outpatient setting as part of your care model. • Facilitate patient engagement that improves the care experience. • Encourage and track wellness and prevention. • Use a well-defined clinical care model with standardized care paths. • Form decisions using data-driven analytics and evidence-based medicine. • Use health information technology for clinical decision support, clinical integration, and information exchange. • Provide a dedicated care coordinator for the network. • Provide transparent feedback loops on all management initiatives.
Practical Steps Forward • Evaluate supply chain and back office expenses. • Learn about SNFs in the area community. • Assess post-acute partners using several quality metrics, such as nurse staffing ratios and star ratings. • Utilize long term care provider networks to band together. • Consider affiliations for shared services.
Practical Steps Forward If APM participation is your goal: • Cooperate with risk-bearing entities during application process. – Engage with hospital or convener entities • Determine strategy for collaborating with awardees. – Sharing upside and/or downside risk – Determine areas of cost savings and care coordination to “market” to awardees – Offer cost savings initiatives to include in care redesign to include in Implementation Protocol of CMS contract
Practical Steps Forward • Keys to Successful Provider Contracting & Compliance – Infrastructure – Data collection and data analysis – Case management/care coordination • Keys to Successful Affiliations – Communication – Governance and management – Input from all stakeholders – Effective conflict resolution – Revisiting goals and definitions of success as goals are achieved
A LOOK AHEAD
Key Dates in 2019 Date Milestone Spring Next round of BPCI-A applications, for second cohort to start Model Year 3 on January 1, 2020 Summer Application cycle for Medicare Shared Savings Program start date January 1, 2020 Also possible for 2019… Updates to Stark law Updates to Anti-Kickback Statute Announcement of new APMs, including new (mandatory?) bundled payment model
Questions? Aaron Elias aelias@pyapc.com 800-270-9629 PYA PC Jeanna Palmer Gunville jgunville@polsinelli.com 312-873-2950 Polsinelli PC

More Related Content

Modern Relationships Between Physicians, Hospitals, and Long-Term Care Providers in a Time of Risk-Based Contracting

  • 1. Modern Relationships Between Physicians, Hospitals, and Long-Term Care Providers in a Time of Risk-Based Contracting Aaron Elias PYA PC Jeanna Palmer Gunville Polsinelli PC
  • 2. Jeanna Gunville, Shareholder, Polsinelli PC – Outside general counsel for regulatory and transactional matters – Alignment strategies between hospitals and health systems and post-acute care providers including clinically integrated networks, accountable care organizations, and joint ventures – Pay-for-performance initiatives, shared savings programs, and bundled payments Presenter Introduction
  • 3. Aaron Elias, Manager, PYA PC – Healthcare consultant for value-based payment and delivery models – Selection and implementation of alternative payment models, including pay-for-performance initiatives, shared savings programs, and bundled payments – Population health management initiatives, including ambulatory care management programs Presenter Introduction
  • 4. Overarching Goals • Understand the changing reimbursement landscape for healthcare providers. • Understand the spectrum of options to advance value-based care (alternative payment models). • Review network formation and strategic partnerships as a means to thrive in new payment models.
  • 5. Let’s talk about… • Key considerations when supporting initiatives between acute and post-acute care providers for success in risk-based contracts. – Factors driving a higher degree of partnership among providers – Recent regulatory changes impacting compensation and data sharing – Example relationships between acute and post-acute care providers (e.g., existing APMs like BPCI Advanced or ACOs) – Legal/valuation aspects and things to consider
  • 6. Let’s talk about… • Practical steps to move your organization forward. • How can long-term care providers make economic and clinical value arguments that appeal to consumers, payors, employers, and others that could engage them in value-based payment models? • Timing and deadlines for governmental APMs and development of plans for clinical integration across providers.
  • 8. Value-Based Payment Fundamentals • “Value-based” healthcare: – Healthcare delivery and payment models involving financial and other incentives to ensure patients receive appropriate, high-quality care to increase the overall “value” of that care – Care delivery and financial incentives linking fee-for- service payments to care quality and “value” – Examples: • Pay-for-performance • Episodes of care and population health • Shared savings and risk • Linkage to “quality” • Hospital Value-Based Payment Program • Physician Quality Payment Program/MACRA
  • 9. Value-Based Payment Models • Fee-for-Service • Pay-for-Coordination • Pay-for-Performance • Upside Shared Savings • Downside Shared Savings • Bundled Payment (Episode Based) • Partial/Full Capitation • Global Budget FinancialRiskto Providers/ParticipantsLeast Most
  • 10. Alternative Payment Models A public-private partnership established to accelerate transition in the healthcare system from a fee-for-service (FFS) payment model to ones that pays providers for quality care, improved health, and lower costs.
  • 11. Trends in APM Adoption Medicare APM Participants
  • 12. Value-Based Payment Fundamentals • Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). SSA Section 1848(q) – Enacted April 2015 (bi-partisan support) – Final rule published November 4, 2016 • MACRA’s Major Changes: – Repealed Sustainable Growth Rate – Modifies/consolidates Medicare quality programs (Meaningful Use, PQRS, Value Based Modifier) – Continues fee-for-service payments, but with potential payment adjustments via: • “Merit-Based Incentive System” (MIPS) • “Alternative Payment Models” (APMs)
  • 13. Trends in APM Adoption Medicare APM Participants Source: Health Affairs. Recent Progress In The Value Journey: Growth Of ACOs And Value-Based Payment Models In 2018
  • 14. Value-Based Payment Fundamentals • CIN = Clinically Integrated Network • ACO = Accountable Care Organization • Often used interchangeably, but may differ in scope depending on the purpose of the network. • Both are a means to participate in alternative payment systems (both commercial and CMS). • Examples: MSSP, Pioneer ACO, Next Generation ACO, also commercial bundled payment programs
  • 15. A Snapshot of the Provider Transition to Value-Based Care Need reliable and timely data on cost, quality, clinical decision support, etc. Must make investments in health management infrastructure (e.g., IT, clinical teams) Compensation must align with payments Manage pace of transition Know your patient population Engage patients as consumers Find the right partner(s) Manage multiple payors The list goes on…
  • 17. Recent Regulatory Changes • Medicare Shared Savings Program (MSSP) authorized by Affordable Care Act in 2010 • Authorized Medicare “Accountable Care Organizations” and CMS Innovation Center • 2012 first performance year for SSP ACOs • Jan. 2018 – 561 ACOs, serving 10.5M Medicare beneficiaries: – Track 1 – Shared savings upside only 460 ACOs – Track 1+ – Shared losses 55 ACOs – Track 2 – Shared losses 8 ACOs – Track 3 – Shared losses 38 ACOs • CMS observations/perceptions: – Some Track 1 models increased costs to Medicare – Tracks 2 and 3 have shown savings to Medicare and are improving quality – “Low revenue” ACOs (typically physician practices and rural hospitals) outperform High revenue ACOs (typically involving hospitals with more than 100 beds) – Mixed historical results; need to migrate to risk
  • 18. Recent Regulatory Changes Major Changes in the MSSP Final Rule - 83 Fed. Reg. 67816 (Dec. 31, 2018) • 5 year participation agreement; July 1, 2019, or Jan. 1 start dates • “Basic” and “Enhanced” Tracks • Shared savings opportunity (linked to quality) and loss obligations • Election/mandatory migration to higher level and risk • Low Revenue, High Revenue, Initial, Re-entering, and Experienced ACOs • Beneficiary assignment methodology – annual choice • Payment system waivers – Telehealth and 3 day SNF waivers • Beneficiary incentives
  • 20. Recent Regulatory Changes BPCI-Advanced Program • Additional voluntary Advanced APMs • Hospital or physician group practice initiates the bundle • All providers get Medicare FFS rates • Participants will likely seek to achieve savings by changing PAC patterns, and by controlling claims made to Medicare (i.e., shortening SNF days, but balancing against risk of hospital readmission) • The BPCI-A entity (hospital or physician group practice) receives a check from CMS for the savings
  • 21. Recent Regulatory Changes BPCI-Advanced Program • Participants can waive the 3-day inpatient stay requirement to access skilled nursing facility care • Final gain share is contingent on quality performance; therefore, there is caution to discharge patients to a home setting (e.g., assisted living or other long-term services and supports setting) if there is any concern that the person will be readmitted to the hospital • Performance on hospital readmissions plus 6 other measures determines how much of any savings participants keep
  • 22. Recent Regulatory Changes BPCI-Advanced Program • Impact on PAC service delivery: – Care substitutions to reduce cost of care for an episode, such as bypassing skilled nursing facilities and sending patients directly from the hospital to the home, with or without home health care – BPCI-A participants will choose to send patients to SNFs that can demonstrate shorter lengths of stay and reduced hospital readmissions – New care transition and care management protocols – Better access to providers at the SNF or assisted living facility, or to support home health providers in order to avoid unnecessary hospitalizations
  • 23. Growth in Medicare Advantage • Medicare Advantage – Plans are offered by private companies approved by Medicare – More than 20 million Medicare beneficiaries (34%) are enrolled in Medicare Advantage plans in 2018 – Share of Medicare beneficiaries enrolled varies by state from 1%-40% – Full capitation – Transparency with data is key – Opportunities for non-skilled in-home care – Post-acute providers need to move quickly into this space
  • 24. Recent Regulatory Changes • SNF Quality Reporting Program – Requires SNFs to submit patient assessment data (MDS 3.0) – Failure to submit = 2% cut to Annual Payment Update • SNF Value-Based Purchasing Program – SNF 30-Day All-Cause Readmission Measure – 2% withhold re-distributed based on performance • Nursing Home Compare • Patient Driven Payment Model – October 1, 2019 – Shift from therapy services volume to reimbursement based on patient’s condition (primary diagnosis) at admission and successive care needs
  • 25. Recent Regulatory Changes New CMS Decisions Have a Dramatic Impact on Post- Acute and SNF Reimbursement • Cannot be APMs on a stand alone • Cannot be Primary Risk Takers • Can partner with Hospital APMs and Physician Group APMs to help those entities manage risk • This will lead to expansion of Episode of Care Deals
  • 26. Healthcare in 2019 Looking ahead . . . • HHS Secretary Alex Azar has reaffirmed the role of the Innovation Center, and opened the door to future mandatory programs. – “I believe that we need to be able to test hypotheses… if to test a hypothesis there around changing our healthcare system, if it needs to be mandatory as opposed to voluntary to get adequate data, then so be it.” • CMS Administrator Seema Verma – Recent emphasis on patient centric solutions, access to records, and pricing transparency.
  • 27. Healthcare in 2019 • Recent Health and Human Services and CMS Requests for Information regarding removing barriers to value-based care in various laws • Industry players submitted comments – Fraud and abuse waivers for value-based arrangements similar to those used in the Medicare Shared Savings Program (MSSP) – Changes to FMV requirements and Advisory Opinion process – Creation of value-based exceptions – Ability to share technology/infrastructure • Part of Agency’s “regulatory sprint” to coordinated care
  • 28. Healthcare in 2019 • What might the future hold? – ACO Improvements Act – 116th Congress – CMMI Direct Provider Contracting models on horizon – Medicare Advantage benefits – Regulatory alignment and consistency at state level – Shared savings offerings in commercial plan design and TPA support – Provider incentives – Capital, innovation and infrastructure (i.e., Private Equity; super MSO) – Transparency and beneficiary incentives – Will employers go directly to providers?
  • 29. Healthcare in 2019 • Continued growth in commercial value-based payment programs – Tend to mirror CMS programs, especially BPCI, and concentrate on high cost procedures – Humana recently expanded an orthopedic bundled payment model for hip and knee replacements to a total of 13 states (to Alabama, Florida, Georgia, Illinois, Louisiana, Mississippi, and Texas from Ohio, Tennessee, Indiana, Kentucky, North Carolina, and Virginia) • Payors as providers? – The lines between payor and provider continue to blur
  • 30. RELATIONSHIP OPTIONS IN VALUE- BASED PAYMENT MODELS
  • 31. All Over the Headlines
  • 32. Relationship Options in Value-Based Payment Models • Medicare-patient continuum – Hospital  SNF  Home/community (with or without HHA) – Hospital  SNF  Home with HHA  Home – Hospital  Home with HHA  Home – Hospital  Assisted Living with HHA  Home
  • 33. Relationship Options in Value-Based Payment Models • ACO transformation of Post-Acute Care • PAC providers like SNFs, ALFs, and Home Health Care will need to determine how they want to engage with acute, ACO, or physician partners • Examine the model or program • Understand the payor incentives under the program • Pressure to become a preferred provider
  • 34. Relationship Options in Value-Based Payment Models • SNF Roles in this Environment 1. Efficient downstream provider; provide high quality services but at an arm’s length to hospitals (past) 2. Preferred collaborator; favored partner for risk- taking hospitals (now) 3. Risk partner; SNF shares in payment risk with hospital and takes an active role in risk management for patients ((near) future)
  • 35. Relationship Options in Value-Based Payment Models • Traditionally SNFs have served the entire community and whole spectrum of short-term/high acuity to long-term/low acuity and of Medicare, private, and Medicaid payors • Some SNFs shifting to focus on short-term/high acuity and Medicare/private pay only • Reasons: – Patient choice – Baby Boomers want “spa” experience for rehab – Specializing in high acuity care may be necessary to attract hospital partners (including ACO participation) – Medicare is far more lucrative, but will need high volume of short- term admissions
  • 37. Legal Considerations • Physician Self-Referral Law (“Stark” Law) – Prohibits physician referrals for designated health services (“DHS”) to entities with which the physician has a financial relationship, unless an exception applies. • Anti-Kickback Statute • Prohibits offering, soliciting, providing, or receiving remuneration in exchange for referral of Federal health care program business. • Civil Monetary Penalties Law – Prohibits offering or providing remuneration to Federal health care program beneficiaries that is likely to influence beneficiary’s choice of provider. – Prohibits hospital from knowingly making (or physician from knowingly receiving) a payment to a physician to reduce or limit medically necessary services for Federal health care program beneficiaries. Implicated by physician financial and referral relationships, hospital incentives/payments to reduce care, and beneficiary inducement
  • 38. Legal Considerations • Antitrust – Market Concentration and Integration Implicated by impact on competition by too many providers/exclusivity in the market or joint action by competitors without integration • Tax Exempt Organizations Implicated by use of charitable assets for private inurement, private benefit; excess benefit transactions • Health Insurance Portability & Accountability Act – Restricts use of protected health information without patient consent, except in limited circumstances Implicated by sharing of patient information and restricted records
  • 39. Legal Considerations Other Legal Issues • State fraud and abuse laws and fee splitting prohibitions • Corporate practice of medicine, licensure, and liability concerns (choice of entity and entity activities) • Business of insurance and insurance risk • Peer review and protections • State/local tax exemption requirements
  • 40. Legal Considerations • “Traditional” Medicare compliance concerns (e.g., False Claims Act, attestation, fraud, and abuse, etc.) – Ensure that bonuses or performance incentives tied to quality metrics stay within FMV • APM Participation: – Broad waivers available for MSSP participants, and narrow program specific waivers for Innovation Center programs (like BPCI) – Commercial APMs: Not well defined how enforcement will occur – Multiple Stark exceptions may apply: Professional Service/FMV compensation; Risk share exception
  • 41. Legal Considerations • Structure participating provider agreements are consistent with regulations/CMS awardee contract. • Waivers are available if guidance is strictly followed. • Distribution of savings to participating providers implicates fraud and abuse laws and regulations.
  • 42. Legal Considerations Compliance Considerations • With the high volume of data that will be produced to the government for payment, expect increased scrutiny of that data for accuracy. • Providers can expect contractors to monitor and test quality data. • All metrics should be clear and benchmarked against actual performance. Beware overlapping payments. • False certification claims can be based upon attestations to accuracy of data. • Focus on the accuracy of diagnosis coding and documentation which is used to risk adjust capitated payments.
  • 44. Practical Steps Forward • Value Based Contracting is the future – all lines of business • Uncertainty in the market – ACA, payment reform, and payment cuts • New healthcare delivery methods for new payment models = new compliance risks
  • 45. Practical Steps Forward • Self-assessment for market and aims • Identify key partners • Determine where to focus resources • Know your data • Engage in smaller initiatives and scale up • Get to know fellow long term care providers in your area • Consider engagement in a network
  • 46. Demonstrate Economic and Clinical Value
  • 47. Demonstrate Economic and Clinical Value Data Points to Monitor: • Overall budget to actual comparisons • Actual to expected comparisons for utilization and unit cost • Evaluation of progress toward goals for specific initiatives • Achievement of quality measure targets • Detailed analysis by primary care physician • Patient satisfaction • Provider recruitment
  • 48. Demonstrate Economic and Clinical Value • Include home health services, telehealth, or a lower cost outpatient setting as part of your care model. • Facilitate patient engagement that improves the care experience. • Encourage and track wellness and prevention. • Use a well-defined clinical care model with standardized care paths. • Form decisions using data-driven analytics and evidence-based medicine. • Use health information technology for clinical decision support, clinical integration, and information exchange. • Provide a dedicated care coordinator for the network. • Provide transparent feedback loops on all management initiatives.
  • 49. Practical Steps Forward • Evaluate supply chain and back office expenses. • Learn about SNFs in the area community. • Assess post-acute partners using several quality metrics, such as nurse staffing ratios and star ratings. • Utilize long term care provider networks to band together. • Consider affiliations for shared services.
  • 50. Practical Steps Forward If APM participation is your goal: • Cooperate with risk-bearing entities during application process. – Engage with hospital or convener entities • Determine strategy for collaborating with awardees. – Sharing upside and/or downside risk – Determine areas of cost savings and care coordination to “market” to awardees – Offer cost savings initiatives to include in care redesign to include in Implementation Protocol of CMS contract
  • 51. Practical Steps Forward • Keys to Successful Provider Contracting & Compliance – Infrastructure – Data collection and data analysis – Case management/care coordination • Keys to Successful Affiliations – Communication – Governance and management – Input from all stakeholders – Effective conflict resolution – Revisiting goals and definitions of success as goals are achieved
  • 53. Key Dates in 2019 Date Milestone Spring Next round of BPCI-A applications, for second cohort to start Model Year 3 on January 1, 2020 Summer Application cycle for Medicare Shared Savings Program start date January 1, 2020 Also possible for 2019… Updates to Stark law Updates to Anti-Kickback Statute Announcement of new APMs, including new (mandatory?) bundled payment model
  • 54. Questions? Aaron Elias aelias@pyapc.com 800-270-9629 PYA PC Jeanna Palmer Gunville jgunville@polsinelli.com 312-873-2950 Polsinelli PC