Advancing Risk Capability in 2015: MACRA and 2016 Medicare Proposed Rule
Center For Industry Transformation
The DHG Healthcare Center for Industry
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
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
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).
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
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
Fee-for-Service-Payment/AcuteInpatientPPS/FY2016-IPPS-Proposed-Rule-Home-Payment Rates
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% FY 16 IPPS Proposed Operating Payment - Full Update
Payment Rates
FY 16 IPPS Proposed Payment: Full UpdateFY 2015
Final
FY 2016
Proposed Change
National Adjusted Operating Standardized Amount (Full Update) $5,437.85 $5,479.03 $47.18 FY 2015 Final FY 2016 Proposed Change
Capital Standard Federal
Payment Rates
Full Update
(1.9% increase) 5,479.03
Hospital Did NOT Submit Quality Data
(.425% increase) 5,442.74
Hospital is NOT a Meaningful EHR User
(-.25% decrease) 5,406,44
Hospital Did NOT Submit Quality Data and is NOT a Meaningful EHR User
(-.925% decrease) 5,370.15
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
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
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:
Polling Question
What is the deadline for submitting
comments on the FY 2016 IPPS Proposed
Rule?
Other Recent Proposed Rules
•
Inpatient Rehab Facilities PPS:
– Published April 23, 2015
– 1.7% payment rate increase – Comments due June 22, 2015
•
Inpatient Psych Facilities PPS:
– Published April 24, 2015
MEDICARE ACCESS
AND CHIP
REAUTHORIZATION
ACT OF 2015
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
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
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
MACRA
•
Revisions to Medicaid DSH Reductions (cont.)
– Changed yet again by MACRA - Delayed one more year
MACRA: Physician Payments
• Payment rates for 2015-2019 will be .5% annually and then frozen 2020-2025 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
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
Road Ahead: VBP Summary
• Definitions out to 2021
• Tightening up and equality on domains
• Expansion of definitions
• Adding new measures
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
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
COPD Mortality
•
COPD is the 3
rdleading 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
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
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
FFY 2019
FFY 2020 and 2021
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 2015.
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)
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
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:
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
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
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.
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
