Just before the holidays, the Centers of Medicare & Medicaid Services (CMS), led by Administrator Seema Verma, released the latest evolution of the in Medicare Shared Savings Program – Pathways to Success in the continuing effort to measure the value of value-based care. What follows is a high-level summary of the key changes in the final rule. With the uncertainty behind us, we can now all take the next step towards an outcome based future.

Basic and Enhanced Tracks
Since the beginning of the program, CMS has recognized that one size does not fit all and has used “tracks” in MSSP. In Pathways to Success, CMS replaced the current Track 1, Track 2, Track 3 and Track 1+ models with two tracks: Basic and Enhanced. Basic is a 5-year glide path from the old Track 1 to the old Track 1+. Enhanced is essentially Track 3. Every ACO will move from current tracks to this Basic/Enhanced framework over time. Basic E and Enhanced qualify as advanced alternative payment models.

CMS will allow “low-revenue” ACOs to continue with no downside for an extra year, which means they can spend two years in Basic B and then skip to Basic D.1 Previously an ACO could stay in one-sided risk for 6 years, now it is only 2 or 3 years.

The other big change to the Tracks is the length of the contract which has grown from 3 years to 5. With a longer contract, an ACO has greater opportunity for its improvements in value to accumulate over time before the cost target is lowered (or rebased) when the contract ends. ACOs with low historical costs to start with may not view the longer contract favorably, they CMS provides them the flexibility to change tracks and rebase the benchmark earlier which would mitigate the negative effects the longer contract period would otherwise have. Overall, the longer contract period is beneficial for the added stability and predictability it provides as all ACOs have greater ability realize a return on their investment over a longer period.

A Note About 2019
The July 1st start date for 2019 creates unique concerns around how to calculate performance in 2019. All financial and quality metrics are based on the whole of 2019. There are no allowances in reporting, in reconciliation or any other financial or quality measures for the fact that a practice may only be in the ACO 6 months.

For ACOs that switch to the new Tracks on July 1, CMS will evaluate costs for calendar year 2019 twice: once under the existing rules and once under the new rules.
First Six Months – $4,000,000 in Savings Under Old Rules and a 90% Quality Score
Total Savings x Share Rate x Quality Score x Portion of the Year
$4,000,000 x 50% x 90% x 50% = $900,000

Last Six Months – $5,000,000 in Savings Under New Rules and a 90% Quality Score
Total Savings x Share Rate x Quality Score x Portion of the Year
$5,000,000 x 75% x 90% x 50% = $1,687,500

Total 2019 Payments to ACO: $2,587,500 ($900,000 + $1,687,500)

Benchmark Methodology
The hardest thing in value based care is continually improving every year. The second hardest thing in value- based care is measuring the value being created. Programs have to predict what the world would have been had the accountable care organization (ACO) not existed. A mix of policy, economics and actuarial science must come together to set cost targets or benchmarks for ACOs. The new changes in benchmarking methodology place more weight on how an ACO performs compared to other providers in their local markets and less weight on how the ACO performs compared to the national average. There are many changes in the rule. We talk about our top three.

Risk Adjustment
Risk adjustment2 can go up (subject to a 3% from benchmark cap) and down (no cap) in any year now, but it is the difference between the ACO’s risk experience and the region’s experience that matters. If an ACO’s risk scores goes up by 4% from benchmark and the region’s risk does not change, the ACO’s costs will be adjusted by 3%. However, if an ACO’s risk score goes up 5%, but so does the risk score in the ACO’s region, then the impact on the ACO’s benchmark is mostly negated.

This was a much needed change from CMS’s old policy of pretending that established patients of physician practices never got sicker. This policy falls solidly in the not perfect, but better than before bucket. In the rule, CMS said that nearly 30% of ACOs will hit the 3% cap. We think that is far too many and will continue to encourage CMS to raise the cap so that it only captures outliers.

Regional Benchmarking
The most impactful change of the new rule was the incorporation of regional benchmarking in all years of the new tracks. We are strong proponents of regional benchmarking going back to 2014 when we were talking about “blended” benchmarks based on historical costs and regional cost efficiency.

As with the current rules, the percent of the ACO benchmark made up of regional efficiency increases over time and depends on whether the ACO is regionally efficient or not.

CMS is also now capping the bonus that comes from regional benchmarking at the category (ESRD, Disabled, Dual, Aged) level. The cap is 5 percent of the national average for that category. For example, if the national average for aged beneficiaries is $10,000, then the regional bonus for the aged category can be no more than $500.

Regional Inflation Blended with National Inflation
Just as regional benchmarking is moving to the first agreement period for an ACO, so is regional inflation. Unlike the blended benchmark, we support 100% use of regional inflation as a better measure of ACO performance. National inflation creates advantages and disadvantages to the ACO that are not due to the work of the ACO, but are really the result of luck.

Regional inflation is defined as the year-over-year change in risk-adjusted costs in the counties in which the ACO has patients.3 CMS includes the ACO’s assigned beneficiaries in the county cost and risk. So when an ACO reduces costs, it also reduce the county’s costs, lowering regional inflation. If an ACO is in New York City and only accounts for 2% of the region’s beneficiaries, this is not a big deal; however, many rural ACOs account for over 20% of their region and 13 ACOs nationally account for more than 50% of their respective regions. The greater an ACO’s market share, the less it benefits from its own cost reduction accomplishments. We detailed the problem in an article early in 2018.

CMS acknowledged the problem, but their “solution” doesn’t solve the problem. They will blend regional inflation and national inflation together for ACO based on market share. If the ACO accounts for 20% of the beneficiaries in their region than their inflation update is 80% regional and 20% national. This reintroduces the luck factor into the inflation update. If an ACO is in a region with lower than national inflation, it benefits from this policy. If the ACO is in a region with higher than national inflation, it loses under this policy. We continue to encourage CMS to directly solve this “rural glitch” and remove the ACO’s beneficiaries from regional comparison.

Final takeaways:
1.ACOs have to move to risk faster in new tracks with longer contracts

  • Understand the difference between revenue-based risk and total cost of care risk
  • Consider moving to risk as soon as the ACO is ready to get higher savings

2.ACOs are measured against their local markets more than ever before

  • Know whether your ACO is regionally efficient or not
  • Monitor your region to understand how changes in it will affect your performance
  • Be aware of your patients’ risk scores – the more accurate the risk score the more accurate the ACO’s benchmark

3.ACOs have more choices to make than before and more than we could cover here

  • Choose annually between prospective and retrospective assignment
  • More waivers than before: SNF 3-Day waiver, telehealth and beneficiary incentives

The evolution of the Medicare Shared Savings Program to Pathways to Success increases our ability to measure value. Just as those creating the value must continually improve so must the measurement of value continuously improve. We look forward to the bright future in Pathways Success and the ACO movement.
__________________________

Footnotes

1. A low-revenue ACO is where the Medicare revenue received by the ACO providers for all patients is less than 35% of the total cost of care of the ACO assigned patients. Analysis of MSSP results through 2016 by CMS showed that low revenue ACOs, which include fewer components of the health care system in the ACO itself, performed better as a cohort than high revenue ACOs. While physician only ACOs tend to be low revenue this is not always the case. Each ACO should conduct an analysis of its Medicare revenue to determine its status.
2.CMS used the Hierarchical Category Condition Model (CMS-HCC) to reflect the health status of the ACO’s assigned population. This model is prospective meaning it attempts to predicts next year’s cost using information about a person’s health condition this year.
3.The change from year to year in each county is weighted by the percent of ACO assigned patients who live in that county. If 20% of the ACO assigned patients live in Montgomery County then Montgomery County’s 2019 inflation will make up 20% of the ACO’s regional inflation for 2019.

Today, we submitted to CMS our comments on the proposed changes to the 2019 Physician Fee Schedule. This year was more exciting than most with CMS proposing significant changes to how physician’s bill for evaluation and management services i.e. the traditional office visit. We worked with our partner physicians and analyzed over 700,000 claims to inform our comments on this proposal. Below is our full comment letter and analysis to CMS.

Dear Administrator Verma:

Aledade (www.aledade.com) partners with 272 primary care physician practices, FQHCs and RHCs in value-based health care. Organized into twenty accountable care organizations across 18 states, these primary care physicians are accountable for over 240,000 Medicare beneficiaries. More than half of our primary care providers are in practices with fewer than 10 clinicians. We are committed to outcome-based approaches to determine the value of health care. We are committed to using technology, data, practice-transformation expertise and, most important, the relationship between a person and their primary care physician to improve the value of health care.

For our comments on the 2019 proposed physician fee schedule, we focus on those issues closest to value-driven health care and to independent physician practices, including:

  • Changes to evaluation and management (E&M) documentation and payment
  • New codes for physician time spent with patients that is not face to face
  • Updates to the Quality Payment Program (QPP)
  • Changes to the quality measures in the Medicare Shared Savings Program (MSSP)

E&M Documentation and Payment

We are pleased that CMS is seeking to reduce the burden of E&M documentation. Despite being outdated and misvalued, E&M codes have remained largely unchanged in the last twenty years. This is mainly due to a lack of consensus on the best way to revise the documentation guidelines and payments in the physician and payer community. We evaluated the proposed changes with a belief that reducing physician burden is a worthy and long overdue goal.

Deciding which E&M Level
We support CMS’s proposal to allow for two new, streamlined approaches to determining the E&M level.

  • Basing the level of E&M solely on the complexity of the medical decision making required
  • Relying on time as the deciding factor for the level of visit without the focus on counseling or care coordination

By providing two alternative methods of documentation, CMS would allow physicians to match their choice to their practice style and patient population. CMS would also gain experience with the different methods that will inform future efforts to improve documentation focused on worthwhile medical record keeping and care coordination.

However, our partner physicians have given us important feedback that the impact of CMS changes are limited. CMS documentation requirements are not the sole driver of the current level of documentation in most practices. Commercial payers or malpractice concerns would continue to necessitate documentation even if CMS finalizes these proposals. We encourage CMS to continue to work with the AMA CPT editorial panel to revise the guidelines at their source to minimize unnecessary documentation across the entire patient panel.

E&M Single Payment Rate
We cannot recommend that CMS finalize the single payment rate for level 2 through 5 E&M visits, even with CMS’s efforts to use G codes to minimize the variance that a single rate would cause. This decision informed both by feedback from our partner physician practices and from our analysis of the effects the rate and G-codes would have on practice revenue. Specifically, we analyzed 771,011 2017 claims of 213 Aledade practices. We provide details of that analysis and detailed feedback from our partner physician practices in the appendix. Our key takeaways are:

Neither the documentation not the single payment rate can be evaluated with consideration of interaction with other Medicare policies and with policies outside of Medicare from other payers and regarding liability

  • Without the G-codes, the practices would lose 2.3% of their revenue from E&M
  • With the addition of the primary care-focused GPCX1, the practices would gain 3.2%
  • Practice level effects vary widely with a range of -19% to +41% (see graph below)
  • To eliminate the negative effects on 99% of the practices, the extended time code, GPRO1, would have to be billed on 29% of Level 4/5 visits
  • Beneficiary risk scores do not significantly account for practice level differences in utilization of level 4 and 5 visits versus level 2 and 3 visits

 

The graph below shows the distribution of change at the practice level:

This variation creates substantial revenue uncertainty for practices. Considering Medicare’s limited effect on overall documentation requirements faced by a practice and this uncertainty, we do not believe that payment rates are an appropriate tool to reduce physician documentation. We are also concerned about introducing harmful incentives. A single payment rate combined with the MPPR policy (discussed later) incentivizes frequent limited visits that inconvenience Medicare beneficiaries, at a minimum, and possibly create less cohesive care. While the G codes mitigate this to some extent, the incentive remains both to shorten visits and to prefer patients who can be well cared for in a short visit and patients who can easily make multiple trips to the office.

Home Visits
We support the CMS proposal to remove the requirement to justify the medical necessity of a home visit. Given the challenges of providing a home visit and the obvious convenience to the beneficiary, requiring justification is an unnecessary step.

Reducing the Least Expensive Procedure by 50 Percent
We cannot recommend that CMS finalize its proposal to require modifier 25 when a procedure is combined with an E&M visit. The savings from these policies are applied to the single payment rate by CMS, but the cost that they impose on our practices are not included in our analysis. This means that if both policies were finalized then the impact on practices would be more variable and more negative than in our analysis. However, we do not recommend this proposal for more than its interaction with the E&M single payment rate.

We disagree that there is significant enough overlap between resource use of procedures and E&M to justify a 50 percent reduction. The main overlap is in physical location of the office and administrative components that do not make up 50 percent of the RVUs for most procedures and E&M services. Nothing we have experienced with our partner practices would indicate that the savings to the practice for doing multiple services in a single visit would account for the 50 percent of the costs. Finally, this adds yet another financial incentive to the practice shorten visits. Even if CMS were to finalize the single payment rate for E&M we encourage CMS to not finalize these proposal in conjunction even if it means making adjustments to the single payment rate.

Non-Face-to-Face Physician Time

Chronic Care Management Services by a Physician or Other Qualified Health Care Professional
We support the creation of a separate code for CCM that focuses on and is valued on physician time. The lack of this code creates a disincentive for physicians to step into the care coordination process. By creating this physician valued code, CMS continues its movement to supporting comprehensive chronic care management that began with 99490.

Brief Communication Technology-Based Service
We support the creation of this code because we believe that this service falls between those which are obviously incidental and those which are defined and require direct financial support. However, we acknowledge that the low reimbursement of this code combined with the high administrative cost of the claims process creates concerns. In particular, we are concerned that the collection of the minimal beneficiary coinsurance could result in administrative collection costs that exceed the amount of the coinsurance. To the extent allowed by statute, we encourage CMS to allow practices to routinely waive the coinsurance for this code due to the high financial cost for the practice to collect it.

Updates to the Quality Payment Program
Promoting Interoperability
We support the proposal to apply the individual or group-level score for Promoting Interoperability (PI) for purposes of MIPS score even when the MIPS-eligible clinician participates in MSSP. Even in our more homogenous ACOs (same state, independent primary care), we have seen significant variance in the practice level-PI scores. As with any measurement program, high levels of measure performance requires not just good process and use, but a focus on measure monitoring. Some practices monitor their measures and seek to perform high on the measure. Other practices implement processes focused on workflow, not measure performance. Unsurprisingly the former scores better than the latter. Using the ACO average hides these differences and disincentivizes high scores. By moving the the score to the individual or group level, the choices made by the practice are accurately reflected in the MIPS score of the practice.

Qualifying Professional Determination
We support CMS’s proposal for making the QP determination at the TIN level in addition to the AAPM level. This is a particularly acute issue as the threshold rises to 50 percent. Even primary care-only ACOs receive attribution for only 60-75% of their patients, depending on ACO characteristics such as geography (rural areas have higher attribution than urban). The inclusion of specialists in the ACO, particularly specialists who do not drive attribution, quickly moves the ACO close to the 50 percent AAPM threshold. Having the 50 percent threshold at the AAPM level discourages additional inclusion of specialists in the ACO because it is difficult to predict whether a given specialist will take the ACO below the threshold and therefore remove the AAPM bonus for all ACO participants. We do not believe it is desirable for the QP determination to solely dictate whether an ACO includes a specialist. By moving the QP determination to look both at the TIN and AAPM level, CMS’s proposal to use an -and- methodology removes this disincentive to include specialists while maintaining the attractiveness of the AAPM bonus to ACO participants.

Quality Measurement in the Medicare Shared Savings Program
We support all the measure changes that are being proposed by CMS.
The table below is our measure-by-measure reasoning for this support.
Web Interface Changes

As we continue to look towards outcome measures over process measures, we urge development of a “time spent at home” (https://catalyst.nejm.org/time-spent-at-home-a-patient-defined-outcome/) or “days spent at home” (https://www.nejm.org/doi/pdf/10.1056/NEJMp1607206) patient-centered outcome measure using administrative data.

CAHPS Measures
We support both the inclusion of measuring ACO-45, “CAHPS: Courteous and Helpful Office Staff” and ACO-46, “CAHPS: Care Coordination” and the movement of ACO-7, “Health and Functional Status” to pay-for-performance. While it was not a proposal by CMS, we want to call attention to the increasing weight of CAHPS scores in accounting for differences between ACO performance. As an increasing number of Web Interface Measures top out (only three are not topped out) and as the claims-based measures are reduced in this proposal, the remaining measures for an ACO to distinguish themselves are in CAHPS. We are supporters of CAHPS measurement and do not believe CMS needs to take action in the final rule. However, it is something that CMS should monitor as the program progresses.

We look forward to continuing to work with CMS to incentivize more value creation in health care. Please contact me or Travis Broome (travis@aledade.com) if you have any questions about our submission and/or if we can be helpful to you and your staff as you consider the finalization of this regulation.

Sincerely,
/s/
Farzad Mostashari, MD, ScM
CEO and Co-Founder
Aledade, Inc.

Appendix: E&M Payment Rate Effects Data Analysis
To inform our views on the proposed movement to a single payment rate for E&M levels 2 through 5 and the addition of new G codes we analyzed billing data of 213 practices that were in ACOs participating in the Medicare Shared Savings Program in 2017. There were 771,011 claims that would have been affected by the proposed changes and, therefore, were included in the analysis. We used the 2019 conversion factor to value the RVUs of the 2017 claims in 2019 dollars. We then replaced the RVUs with the proposed RVUs of the single payment rate for the comparison. We adjusted for geography using the Geographic Adjustment Factor File included with the proposed rule. Finally, we applied GPC1X and GPRO1 to variable percentage of the 2017 claims to finish the comparison between 2017 revenue in 2019 dollars to 2019 revenue under the proposed rule

We were interested in the following questions:

  1. What was the mean effect of the policies on the 213 practices accounting for different use of GPC1X and GPRO1?
  2. Does the mean vary by geography?
  3. What were the practice level effects and what was the variation in the mean?
  4. Does practice risk score explain practice utilization of level 4 and 5 visits?

Mean Effect on the 213 Practices
For this first analysis we calculated the mean payment without GPC1X and with full use of GPC1X, by state. Later, we looked at the effects of GPRO1. It is unclear to us at what level GPRO1 would have been used in 2017 had it been available and therefore we account for it separately.


The effect of the practice level distribution with no G codes is negative with state level variation ranging from -$28,377 to gaining $23,104.

As these are primary care practices we ran the analysis assuming 100% of established visit claims use GPC1X.


As CMS expected the addition of the primary care focused G code moves the mean. For the practices in the analysis this means a now positive 3.2%. The geographic variation is essentially unchanged.

Next we looked at the practice level variation. This was the biggest area of concern raised by our analysis and directly led to our decision to not recommend that CMS adopt the proposal.

The above graph should the distribution of % change in practice revenue with 100% GPC1X use. Each block is a practice. As you see the range is dramatic from -19% lose to 51% gain.

While variation has its own costs it is the negatively impacted practices that are most affected. Whether a practice is positively or negatively financially impacted is a direct relation to the ratio of level 4 and 5 visits to level 2 and 3 visits.

We believe it stands to reason that the use of GPRO1, the prolonged visit code would be more likely to be used in level 4 and 5 visits and therefore would disproportionately and positively affect practices who without GPRO1 are negatively impacted financially.

The next graph assumes 15% of Level 4 and 5 Claims with Prolonged Visit Added On

As you can see this greatly reduces the number of practices negatively impacted from 93 to 25 while not increasing the range on the positive side of the graph. However, it does shift the mean from a 3.2% gain over 2017 to a 9.1% gain. We were not able to determine whether that shift can be adjusted for without increasing the number of negatively impacted practices. The ratio of visits with GPRO1, the value of GPC1X and the value of the single payment rate can be tweaked to create a variety of results. We are unable to estimate the rate GPRO1 would have been used in 2017 so the 15% of this graph is illustrative purposes only.

In another distribution we found that it would be necessary to have a GPRO1 use rate of 35% of Level 4 and 5 Claims to eliminate any practice with a loss. This would move the mean to 17.0%.

The final question we attempted to answer was whether HCC risk score controlled for differences in level 4 and 5 variation and could therefore be used to vary the single payment rate in a way that did not require documentation. While risk did reduce some variation (see three graphs below) it did not control for level variation enough to be a viable solution.

In addition to our analysis, the other driver of our decision to not recommend the proposal was feedback from our partner physicians. Below is a summary of the key points they provided to us. The feedback did include both support and concerns; however, unlike the revenue impacts which overall were favorable, the overall feedback was unfavorable.

  • If a physician is paid the same for 10 minutes as for 30 minutes and needs to maintain positive margins as a business owner, the incentive is to limit the volume of complex patients and maintain a practice that leans towards low acuity patients
  • Proposal adds yet more change without addressing the chronic underfunding of primary care
  • Malpractice concerns are the main driver of documentation levels not billing
  • Many visits that should be level 4 and 5 go out as 3s because the documentation is so onerous on a solo practitioner. This levels the playing field between small practices and large practices with billing departments.
  • If CMS can figure out how to level the reimbursement differences, the same principles apply to home visits (CPT 99341-99350) and CMS should do the same for those codes
  • As much concern for the 50 percent reduction in multi-service visits as for the single payment rate combined with G codes. Certainly that the 50 percent policy will reduce revenue, but the effects of the single payment rate on revenue is uncertain so lots of concern that the combined policies will reduce revenue

In about two weeks, I’m joining the team at Aledade as Chief Administrative Officer – largely because three years ago, I went through a health scare.

It wasn’t me; it was my then 86-year-old father. And what started with a short-term crisis dragged out into a long-term battle with our dysfunctional health care system.

For two years, my dad bounced between doctors, hospitalists and specialists. We never got a clear picture of his health or the care he was getting. His doctors rarely talked to one another, rarely gave him much time and I couldn’t talk to them to understand it all.

At the same time, this was happening while I worked at the Centers for Medicare and Medicaid Services, tasked with running the entire Medicare program. I couldn’t help but put our situation into a broader context: if this frustrating and frightening ordeal could happen to my dad- a brilliant lawyer who was on the Law Review at Penn — and his son who ran the world’s largest insurer, what was it like for other families who didn’t have our resources and our knowledge of how to navigate this confusing health care system?

Fortunately, we were saved by a good quarterback – someone who could take a step back and look at the entire field of my father’s health. For an entire hour, a geriatrician sat with my father just to talk with him. He got a sense of his health conditions, what was giving him the most trouble, and the serpentine path he had taken to get help.

The doctor set up a care plan with him, and took a close look at his medications. When we focused on one drug in particular, my father pointed out that studies had shown it was relatively effective. “That’s true,” the doctor said, “until about 75 years of age.” My dad was taking medication that stopped being effective – and possibly became harmful to him — about ten years ago. In the end, we cleared out about half of my father’s prescriptions. It was as if a switch had been thrown. Over the next few months, my dad returned to the person we knew.

Value-based health care, directed by empowered, independent primary care physicians, is what my father and I needed then. Today, everyone agrees it’s what we all need now.

We need primary care physicians to be the stewards of care, guiding patients through this confusing health care system like the captains of a ship – always pointed to the north star of better health. We need a health care system that doesn’t focus on how many procedures or prescriptions patients get, but on how well their doctors keep them healthy. When those priorities are misaligned, that’s when our health care system doesn’t work. I know, because that’s what my father and I saw firsthand.

I’m joining Aledade because I know the team here is working with incredible physicians best situated to chart that path to value-based care. For years at CMS, I looked at the results and dove into the data – I saw that the future of health care will be led by primary care physicians with the autonomy to act in their patients’ best interests. I saw this potential for success across commercial plans, Medicare Advantage, and traditional Medicare – and Aledade’s covering all of these.

At Medicare, my focus was on the operational integrity of a program that provides insurance for more than 55 million Americans. I worked to ensure the program was run efficiently and responsibly for the taxpayers, and that we kept focused on our strategic goals of improving care and reducing costs. That’s what I’m most excited to do here at Aledade. My focus will be making sure the trains run on time – that our hardworking teams are valued and supported, and that we’re helping our partner practices along every step of this journey.

I’m also joining Aledade because there’s a unique mix of purpose and people in this place. I came from public service, and I wanted to join an organization with a mission that’s bigger than profits or short-term returns. Aledade lives its mission every single day.

I also was lucky to work at CMS with some of the most brilliant people in health policy who were also great colleagues. And I see those same qualities here at Aledade. Thanks to the hard work of so many people, Aledade partners with more than 200 primary care practices in 17 states to actively manage the care of nearly a quarter of a million patients. I can’t wait to be a part of the team that’s building the leading model for a health system that’s good for patients, good for doctors, and good for society.

The comment period for Medicare’s proposed rule on the Quality Payment Program closed last night, so as usual we’ll take this opportunity to share our full comments on the proposed updates to how Medicare shapes the path to a value-based future.

August 21, 2017

Seema Verma, Administrator

Centers for Medicare & Medicaid Services

7500 Security Blvd

Baltimore, MD 21244

 

Re:       CMS-5522-P: Medicare Program, CY 2018 Updates to the Quality Payment Program

 

Dear Administrator Verma:

Aledade partners with 205 primary care physician practices, FQHCs and RHCs in value-based health care. Organized into 16 accountable care organizations across 15 states, these primary care physicians are accountable for more than 190,000 Medicare beneficiaries. More than half of our primary care providers are in practices with fewer than 10 clinicians. We are committed to outcome based approaches to determine the value of health care. We are committed to using technology, data, practice transformation expertise and most importantly the relationship between a person and their primary care physician to improve the value of health care.

Creating a path for independent practices to thrive in the transition to value-driven health care

  • Whole hearted endorsement of the inclusion of “the preservation of independent practices as a guiding principle for the Quality Payment Program (QPP)”
  • Virtual groups provide a needed step on the path to transition to value-driven health care by allowing independent practices to come together for QPP even if they are not ready to take on the total cost of care
  • Virtual groups are part of the path to value-driven health care that must be carefully crafted to be attractive to independent physicians
  • The low volume threshold proposal leaves too much of the Medicare spend and therefore too many Medicare beneficiaries out of the program. We recommend that no more than 10 percent of the Medicare Part B spend should ever be excluded from QPP.

Measuring QPP performance and reducing administrative burden

  • We recommend that the cost category for total cost of care be included for 2018.
  • We recommend that the AAPM bonus move forward a year with bonuses earned in 2018 paid in early 2019 or even in 2018 itself
  • We recommend that CMS value simplicity and minimizing administrative burden above other characteristics of the all-payer determination for APMs

Below is a full explanation of those positions. Thank you for your consideration as we move together through this exciting time in health care. Please feel free to contact Travis Broome (travis@aledade.com) if you or your staff have questions or would like to explore these positions further.

Sincerely,

/s/

Farzad Mostashari, MD

CEO and Co-Founder, Aledade, Inc

Independent Physicians Thriving in Transition to Value

Principle of Independent Practice

It would be difficult to overstate the importance of CMS’s inclusion of the preservation of independent practices as a principle of the QPP. Independent physician practices have proven to be the most successful in accountable care[1] and key to maintaining competitive health care markets.[2] The same characteristics that make the independent physician practices successful also make this principle particularly challenging for CMS to deliver on. Physicians must feel the change in their practice. There is no board room in small practices where a government affairs team will explain slight tweaks in policy that increase revenue by a half a percentage point. The preservation of independent practice in QPP will be felt by CMS’s continuous effort to reduce the administrative burden of participation in QPP through technology, policy and measure design and a continuous effort to link performance with incentives as tightly as possible.

Virtual Groups

We support CMS’s proposal for virtual groups. CMS specifically asked for comment on several additional requirements for virtual groups. We do not believe that at the onset it is advisable to set additional standards on virtual groups. We recommend the following principles to guide CMS’s finalization of the virtual groups.

  • Voluntary election by physicians to be in a virtual group prior to the start of the performance year
  • Agree to work together to improve their performance in QPP
  • Must agree to be scored on quality
  • Can elect to be scored on
    • Clinical Practice Improvement Activities
    • Advancing Care Information
    • Resource Use
  • Can utilize any reporting method including Group Practice Reporting Option (GPRO)
  • Identify to CMS the officer responsible for the virtual group’s reporting
  • The virtual group is responsible for ensuring group reporting (i.e. CMS should not be responsible for aggregating the data across practices except in the area of resource use and other claims based measures)

CMS has proposed that all virtual groups would be scored on all categories as a group. We believe that this could be a limiting approach. For example, it would dissuade any virtual group from admitting members who do have 2014 Certified EHR Technology due to the effects on the advancing care information score.

Finally, we recommend that CMS allow third-party entities to organize and report for QPP on behalf of smaller practices. The practices making up the virtual group should not be required to manage this process internally.

Successful Transition to Value Based Care

We continue to work together with CMS to define a path that both transitions to value based health care and preserves independence.

It is helpful to remember what the path looked like just 5 years ago:

These are all huge leaps. First, physicians must take responsibility for total cost of care in a way they never had before. Second, they must take on a level of risk that could ruin an independent practice. Third, they must develop health insurance operations. The size of those leaps simply prevents many physicians from taking the next step.

Today, with the proposal in this rule for virtual groups the path looks more achievable:

With this proposed rule CMS has smoothed out the move from FFS to total cost of care. In prior regulations, CMS made incremental progress on the move from one-sided risk to two-sided risk. While not specifically for this regulation, we recommend a path to CMS that bases risk on the financial wherewithal of the participants in the total cost of care model and lets physicians move to Medicare Advantage to assume full risk without the burden of claims processing and network development. Our recommendations for the former can be found in the blog for the American Journal of Managed Care[3] and for the latter in the blog for Health Affairs[4].

Our recommended path is:

We believe this path is ideal for encouraging independent practices to continue to make the transition to value based care where they have proven they can succeed at all levels in various pockets of the county. We know they can succeed not just here and there, but in nearly every health care market in the country.

Low Volume Threshold

CMS has proposed to raise the low-volume threshold to exclude individual MIPS-eligible clinicians or groups who bill less than $90,000 Part B billing OR provide care for less than 200 Part B enrolled beneficiaries. We do not support raising the low-volume threshold, and recommend maintaining the current policy of excluding clinicians or groups who bill less than $30,000 to Part B or care for less than 100 Part B enrolled beneficiaries.

In the transition year final rule, CMS estimated that about 32.5 percent of providers would be exempt from MIPS because they do not meet the low-volume threshold, but the number of providers actually exempted for 2017 was higher than anticipated. The increased low-volume threshold creates an arbitrary cut-off for performance in the MIPS program without first assessing the impact of the current low-volume threshold on Part B providers. CMS should continue to transition a greater percentage of total Medicare spend away from fee-for-service to payment arrangements that account for quality, cost, and patient outcomes, rather than further reducing the number of providers eligible to participate.

Further, the modified threshold would mean that some clinicians who were eligible to participate in 2017 will be excluded from MIPS in 2018. We recommend that CMS extend the option for clinicians to voluntary participate in MIPS reporting in 2018 for a performance score and performance-based payment adjustment.  Clinicians who made investments and preparations to participate in MIPS during the transition year should not lose out on the opportunity to earn a positive payment adjustment in 2018.

QPP Measurement AAPM Determination

Resource Use Category

Aledade supports a transition to value-based payments that hold providers accountable for patient experience, quality of care, and total cost. By statute, in the QPP’s third performance year, the cost performance category must be weighted at 30 percent and the MIPS performance benchmark must be set at either the mean or the median score of all MIPS participants. Introducing cost performance into the MIPS score should be done incrementally, rather than creating a steep cliff from 0 percent weight in PY2 to 30 percent in PY3. Therefore, Aledade does not support reweighting the cost performance category to 0 percent of the final score, and recommends this category be weighted to at least 10 percent of the final score.

Measuring cost is an integral part of measuring value because clinicians play an important role in managing care so as to avoid unnecessary services. We appreciate the ongoing CMS efforts to better align the episode cost measures across programs and to better attribute beneficiaries to specialists for purposes of QPP. However, the lack of finality in these efforts should not slow the inclusion of total cost of care in QPP for 2018.

 

Aligning the AAPM 5 Percent Incentive with Action

Currently, a physician chooses to join an AAPM in the summer of 2017 (CMS’s 2018 deadline for the Medicare Shared Savings Program was July 31st), they participate during 2018, they receive their performance in the AAPM in August of 2019 and then they receive their lump sum bonus for participation in the AAPM in May of 2020. Almost three years have passed between a physician’s decision to join an AAPM and the reward for that decision.

When we talk to physicians about AAPM participation they naturally assume that since the 5 percent is contingent only on participation that they will receive the bonus in not May of 2020, but May of 2018 or even sooner. More than one physician has naturally assumed that the bonus would come January 1, 2018. Every minute explaining why this isn’t the case is a minute spent decreasing the likelihood of AAPM participation, the very thing Congress funded the 5 percent bonus to incentivize. While we understand that not all AAPM models require full year participation and therefore within-year bonuses may not be possible, CMS should explore every proxy to bring action and incentive as close together as possible. At a minimum, CMS should use the same year for the QP determination period and the claims period to pay out the bonus the year following participation. So in 2018 participation in AAPM would pay the 5 percent bonus in May 2019 based on the 2018 claims instead of May 2020 based on 2019 claims. To have the bonus for mere participation come seven months after the savings for actual performance in the AAPM strikes physicians as so backwards that it calls into question the credibility of the AAPM itself and negates the positive effects of the 5 percent bonus.

 

All-Payer AAPM Determinations

As members of the Healthcare Transformation Taskforce (www.hcttf.org), we worked closely with other health care providers, health plans, patient groups and health care payers to make recommendations on this area and we would refer you to those comments for the details.

In our comment letter, we want to emphasize the importance the health care providers place on the simplicity of this process. We do not desire to impose a high administrative burden on either health plans or on CMS in order to make the all-payer AAPM determinations. In this case, we would recommend that CMS value simplicity over every other characteristic of this program.

 

 

 

 

 

[1] http://www.nejm.org/doi/full/10.1056/NEJMsa1600142#t=article

[2] https://www.brookings.edu/research/making-health-care-markets-work-competition-policy-for-health-care/

[3] http://www.ajmc.com/contributor/travis-broome/2016/03/changing-stop-loss-formula-can-drive-interest-in-risk-based-models

[4] http://healthaffairs.org/blog/2017/07/06/spurring-provider-entry-into-medicare-advantage/

It was my second day at Aledade when someone told me to get out.

I thought it was a bit early to be fired, but the new colleague sounded convincing enough. I assumed they knew what they were doing.

Luckily, this wasn’t some drastic HR move. It was the first of many times that I’d hear, “You have to get out into the field. Go visit a practice.”

It’s a mantra here at Aledade. Everyone, even the current and former health care professionals on staff, seemed to have a story of the first time they visited one of Aledade’s partner practices. They all said that setting foot in a practice is the best way to find out what works, what doesn’t, and to get a sense of just how challenging and rewarding it is to work in an independent primary care practice today.

So when I first got the chance to visit Kansas, tagging along with New York Times columnist Farhad Manjoo as he worked on his new piece about Aledade’s work, I hopped on a flight to Wichita.

Before joining Aledade, I worked on the public affairs team at the U.S. Department of Health and Human Services. We promoted Open Enrollment for the Health Insurance Marketplace, talked about programs like Head Start, and got key messages out to the public about health threats like Ebola, Zika, and the opioid epidemic. But there was one story we kept coming back to – the future of health care.

We saw it every time we heard from doctors, and every time the Secretary visited a practice. Data had opened up new frontiers. Patients now had the tools to get engaged in their own care. And payment systems focused on value were starting to reward physicians who kept their patients healthy. There was a palpable sense that you could deliver better care and start to lower costs.

It seemed like everything was pointing down this path. Policymakers from both sides of the aisle saw the promise in this new approach. MACRA, the law that changed Medicare’s payment system into one that rewards the value of care, passed the Senate nearly unanimously and the House overwhelmingly. And down the street at HHS, the Department made a historic commitment – saying that, by 2018, half of all payments in Medicare would be payments that rewarded the value of care, not the old fee for service system.

But it wasn’t until I visited Aledade’s partner practices in Kansas that I realized how far down the path these health care professionals already were.

On Wednesday, the New York Times’ Farhad Manjoo published his piece, and he captured this well. “Thanks to Aledade,” Farhad wrote, “the [Kansas] practices’ finances had improved and their patients were healthier. On every significant measure of health care costs, the Aledade method appeared to have reduced wasteful spending.”

Here’s an example of how they were keeping patients healthy:

For example, say you’re a doctor at a small practice in rural Kansas and one of your patients, a 67-year-old man with heart disease, has just gone to the emergency room.

“In the past, we’d only find out our patients were at the hospital maybe weeks afterward,” said Dr. Bryan Dennett, who runs the Family Care Center in Winfield, Kan., with medical partner, Dr. Bryan Davis. With Aledade, Dr. Dennett is now alerted immediately, so “we can call them when they’re at the emergency room and say, ‘Hey, what are you doing there? Come back here, we can take care of you!”

The care management team at Ashley Clinic talks with Farhad.

At Ashley Clinic in Chanute, I saw a larger care team tackle an even larger patient population. As one care manager said, “before, we had the doctor and the patient; a point A and a point C. But there was no one to serve as point B. That’s changed today.”

Two of Ashley Clinic’s patients – a husband and wife – agreed. Both said the care they got now was much better than anywhere they had been before. “We don’t know what an ACO is,” they said. “But we know we hear from our doctor more. And we like that.”

Most importantly, by talking to the care teams and doctors in these practices, I learned that I had been wrong. Value-based care isn’t some new future in the distance; it’s more of a homecoming. As one doctor told me, “This is why I became a doctor in the first place.”

But getting home isn’t always easy.

It’s taking new ways of thinking – focusing on finding the highest risk patients, keeping a close eye on them through chronic care programs, following up with patients as they leave the hospital, and ensuring that patients are going to the most efficient and effective specialists.

While it asks for more time and effort on the part of doctors and care teams, who already put in countless hours caring for patients, the destination is worth the jounrey. And thanks to Aledade’s technology, dedicated support staff in the field, and some inspiring health care professionals, you can find better health care right down a long stretch of Kansas road.

There has been no shortage of health policy news out of Washington in the past few weeks. Which means that one major announcement nearly slipped under the radar, but since this was the most relevant to Medicare, here’s our analysis.

Last week, CMS released a 1,058 page proposed rule to update the Quality Payment Program for 2018. The Quality Payment Program is the implementation of the Medicare and CHIP Reauthorization Act, passed in 2015 – one of the key pieces of legislation in the movement to a value-based health care system. We’ve talked about MACRA and CMS’s proposals to implement it before, so feel free to revisit our feedback on the Aledade blog.

Our key takeaway is that the rule is a win for small and independent primary care practices. That starts right near the beginning (page 9 to be exact), when CMS lays out the aims of the Quality Payment Program.

As the rule says:

“The Quality Payment Program aims to:

  1. Support care improvement by focusing on better outcomes for patients, decreased clinician burden, and preservation of independent clinical practice;
  2. Promote adoption of APMs that align incentives for high-quality, low-cost care across healthcare stakeholders; and
  3. Advance existing delivery system reform efforts, including ensuring a smooth transition to a healthcare system that promotes high-value, efficient care through unification of CMS legacy programs.”
    (emphasis ours)

“Preservation of independent clinical practice.” That new phrase guides not only this proposed rule, but should guide future program decisions as well. When CMS is looking at the best way to transition to value, they are committing to a key consideration of independent clinical practice.

Here’s how CMS puts that commitment into action in this rule: The rule sets up guidelines for virtual groups, allowing small practices to band together while keeping their independence. It preserves the excellent work CMS already did on the interaction between ACOs and MIPS, and adds some relief for small practices who are not yet ready for virtual groups or ACOs.

Let’s walk through some of the changes that are proposed:

  • The creation of a virtual group option for practices
  • Another year-long delay before cost performance becomes part of the MIPS score
  • Bonus points in the MIPS score for small practices (small defined as 15 clinicians or less)
  • Another year-long delay in the requirement to use 2015-edition certified EHRs
  • A significant increase in the low volume threshold to exclude clinicians from MIPS

The Stepping Stone of Virtual Groups

Virtual groups are a completely new option for physicians in 2018. The move to value-based care isn’t immediate. Not every practice can immediately leap into an ACO that puts them on the hook for any higher costs, especially if they want to stay independent. Some need a longer runway, and virtual groups create that option.

Here’s the proposed criteria for virtual groups:

  • A virtual group will be a combination of a solo practitioners or practices (defined as a single TIN) with 10 or fewer eligible clinicians who band together for at least one-year performance period. As of now, there are no geographic, size or specialty limitations on the groups (though CMS is open to comments on this).
  • The group’s participants need to send a written agreement to CMS by December 1, before their performance period starts.
  • At least one member of each participating practice needs to be eligible for MIPS, and the entire group will be assessed as a group on every MIPS category.
  • As the formation requirements are relatively light, these groups will be much easier to form and operate than a typical ACO with fewer responsibilities.

The purpose of creating virtual groups is to create a better path to valued based care. We believe it is worth taking a moment to review the current pathway, compared to the proposed pathway.

Here’s how the runway currently looks as providers move from the old fee-for-service system to two-sided risk:

MACRA Blog 1 pt2

 

In there are at least two major hurdles, especially for small, independent practices. First, the initial step out of fee-for-service and into one-sided risk. Practices want to band together in high-value networks, especially if there’s a chance to share in savings. But many practices don’t want to sacrifice their independence for a hierarchical ownership structure. That’s why we called for CMS to create “virtual groups” last year.

Second, the jump from one-sided risk to two-sided risk can be devastating to practice revenue. If a small, independent practice faces headwinds in one year, losses based on the total cost of care could be devastating. This is why the rule contains practice-revenue based risk. CMS created Track 1+ ACOs to take advantage of this revenue-based risk and they should roll that principle out to all two-sided risk ACOs.

Here’s what the proposed path looks like:

MACRA Blog 2

We’ll dive into this pathway more in a future post. Virtual groups are a key component to making the hardest transition between fee for service and accountability for total cost of care.

Delaying the Cost Factor in MIPS

CMS is proposing to delay the cost category in MIPS for another year. In the vacuum of a single year, this is no big deal. However, MACRA requires a certain transition to the cost category. So every year the transition is delayed, the cliff gets steeper. Right now, CMS is proposing to go from 0 percent cost in 2018 to 30 percent cost in 2019, trying to catch up to the law. There are consequences to kicking the can down the road.

Bonus Points for Small Practices

CMS is proposing 5 bonus points to the total MIPS score for small practices. Small practices are individual practices (defined by Tax Payer ID or TIN) with 15 or fewer physicians, nurse practitioners, physician assistants and other MIPS-eligible clinicians in the practice. The minimum threshold is 15 points, to ensure a practice is not penalized for 2020 based on 2018 performance. So these 5 points immediately get a small practices a third of the way there. This means that a small practice can avoid a negative adjustment in 2020 simply by reporting on at least two quality measures.

Delaying the Required Use of 2015 Edition Certified EHR Technology

Practices will be able to report on the advancing care information category with either 2014 or 2015 edition EHRs. While there are very important improvements to EHRs in the 2015 edition, we have seen firsthand the delays in rolling out 2015 edition EHRs to practices. CMS is proposing that rather than penalizing practices who don’t use the 2015 Edition, they would award 10 bonus points if practices do. As only 100 points are needed for full credit in the ACI category, this is a significant bonus. 

Increasing the Low-Volume Threshold – How Much is Too Much?

In this new proposed rule, CMS suggests they might raise that threshold even higher – from an initially proposed combination of $10,000 in Medicare revenue and less than 100 patients to this year’s proposal of either $90,000 of Medicare revenue or 200 patients. That means nearly half of all physicians could be exempt from this requirement. In other words, more than one out of every ten dollars spent by Medicare Part B. By significantly increasing the low-volume threshold, CMS risks slowing the transition to value-based care and, worse, create a two-tiered system of physicians moving forward opposed to those who are exempt and doing what they can to stay that way.

We believe that American health care needs to avoid a bifurcated or two-tiered system – one in which some providers are paid for improving quality and outcomes, and other providers stay in the old fee-for-service model with different incentives.

This proposed rule estimates that 70 percent of Medicare Part B dollars will flow either through MIPS or Advanced Alternative Payment Models.

That number can never go down.

Every patient deserves to be in a system of better care and lower costs, and every provider deserves to be rewarded for high value care. Instead of kicking the can down the road on cost and exempting more physicians, CMS should concentrate on making the program itself better. They make good strides in that endeavor with this proposed rule.

We will be working closely with our physicians and with other stakeholders to submit complete comments on the regulation in the weeks to come. We look forward to working with CMS on its commitment to move to value, and its clear commitment to preserve independent clinical practice.

President Trump’s administration has made it clear that they plan to greatly alter, if not repeal, the Affordable Care Act. To both sides of the political isle it may come as a surprise that altering the Affordable Care Act will likely have little impact on a core outcome of health reform: the fact that private insurance companies increasingly pay primary care providers for improved health outcomes. Since the presidential election, we have met with a dozen payers in both red and blue states: Arkansas, Florida, Louisiana, Mississippi, Missouri, New Jersey, Pennsylvania, Utah, and West Virginia. Not one payer has mentioned that they plan to stop their efforts, or pull back resources dedicated to moving physicians away from the fee-for-service paradigm and towards paying for outcomes. In fact, every payer we meet is intent to continue to innovate by paying providers in a manner that lowers cost and improves health.

A key piece of the Affordable Care Act created the Medicare Shared Savings Program, and private payers quickly followed with their own efforts to move physicians to shared savings contracts. Years later, private payers continue to dedicate significant resources to move providers away from fee for service and towards value payments. And payers have committed to move all of their providers, across all business lines (commercial, Medicare Advantage, and Managed Medicaid), to value. This investment has been significant. For example, Cigna established CareAllies, a service company that works with provider organizations of all types to focus on improved patient outcomes and better health care quality and affordability. Similarly, UnitedHealthcare (via Optum) has gone further and purchased providers in order to create high value networks and their own Accountable Care Organizations. Humana has a well-established value path (the Accountable Care Continuum) that moves its Medicare Advantage providers away from fee for service on a path towards global capitation. Each of these national payers have undertaken vast strategic efforts that require significant resources for staff and infrastructure, and a change in culture.

Commercial payers believe, and have the data to demonstrate, that paying for value lowers their cost and improves the health of their members. For example, UnitedHealthcare has noted up to 6 percent lower medical costs across a range of value-based care programs, and overall, commercial ACOs have lower expenses per Medicare enrollee and slightly higher quality-of-care scores.

Despite the threat of repealing parts or all of the Affordable Care Act, our payer partners continue to move ahead with their payment reform efforts. The political battle over Obamacare has had no impact on payers’ dedication to reform provider payments; the future of primary care provider payment remains value-based. Though there is still much unknown about the potential repeal and replacement of the Affordable Care Act, the future of physician payment reform is clear.

December 20, 2016

Andy Slavitt, Acting Administrator
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, MD 21244

Re: CMS-5517-FC: Medicare Program; Merit-Based Incentive Payment System (MIPS) and Alternative Payment Model (APM) Incentive under the Physician Fee Schedule, and Criteria for Physician-Focused Payment Models (81 Fed.Reg. 77008 (Nov. 4, 2016))

Dear Administrator Slavitt,

Aledade partners with over 200 primary care physician practices, FQHCs and RHCs in value-based health care. The physicians are across 15 states and are accountable for over 170,000 Medicare beneficiaries. More than half of our primary care providers are in practices with fewer than ten clinicians. As an organization that is dedicated solely to helping independent physicians lead the transition from volume to value, we have a particular set of experiences and perspectives that are highly relevant to the key policy issues faced by CMS in implementing the MACRA legislation.

As described in more detail in our comment letter, a few critical improvements to the final MACRA regulation could improve the uptake of accountable care.
1. Creating a new MSSP model that takes advantage of the breakthroughs in the MACRA regulations regarding risk and matches that risk with proper rewards
2. Allowing independent practices to come together in “virtual groups” now for all aspects of MIPS reporting, and rewarding their clinical practice and health IT advances as they work towards participation in APMs (like gain share only ACOs) and on to AAPMs
3. Simplifying provisions related to other payer APMs and Certified EHR Technology
Thank you very much for your consideration as we move together through this exciting time in health care. Please feel free to follow up with me or Travis Broome (travis@aledade.com) if you or your staff have questions or would like to explore these positions further.

Sincerely,
/s/
Farzad Mostashari, MD
CEO and Co-Founder, Aledade, Inc.

Advanced APM Revenue-Based Nominal Amount Standard

CMS seeks comment for future consideration on the amount and structure of the revenue-based nominal amount standard for QP Performance Periods in 2019 and later. This includes: (1) setting the revenue-based standard for 2019 and later at up to 15 percent of revenue; or (2) setting the revenue-based standard at 10 percent so long as risk is at least equal to 1.5 percent of expected expenditures for which an APM Entity is responsible under an APM.

In our comments on the MACRA proposed rule we supported a 15 percent of revenue standard out of the gate to simplify the requirements. We continue to believe that 15 percent represents more risk than any other path under MACRA and more than satisfies the Congressional standard of more than nominal risk. In response to CMS’s request for comment, we want to highlight the critical nature of maintaining both a revenue based standard and a percentage of model benchmark standard. Using a percentage of model benchmark standard creates vastly different amounts of risk depending on the organization and depending on the APM model. How risky something is to an organization is dependent on the level of risk relative to their financial situation. This variation creates a situation where CMS will not be able to gauge the amount of financial risk any APM entity is actually taking on. What could be disastrously risky for one organization could be less than nominal for another organization.

Reintroducing a model benchmark standard to the revenue standard reintroduces all that was wrong with the standard in the first place, namely that the financial risk would in no way be related to the financial standing of the organization. If Congress had not asked CMS to measure financial risk this would not be a concern; however, Congress clearly wanted the APM entity to take on more than nominal financial risk. This means financial risk should be measured and it should be measured in relation to the APM entity not the AAPM. For these reasons CMS should maintain a pure revenue-based standard that stays well ahead of the risk in MIPS and finalize in the future a 15 percent of revenue standard.

CMS furthers asks for comment on cases where the APM Entity is one component of a larger health care provider organization and using the larger organization as the basis for a revenue-based nominal amount standard. To minimize the revenue based standard, a health care organization could limit the composition of its APM entity to only those health care providers who drive attribution in the model. We do not believe it is necessary for CMS to consider this in determining the revenue-based nominal amount for several reasons. First, by limiting the participants in the AAPM the health care provider organization would lose all the benefits of having those health care providers in the AAPM and that in and of itself has cost. Second, not all models use the same attribution methodologies and certainly do not have the same economics so what might seem wise in one model to include the larger health care organization may not make sense in another model and could inadvertently drive large health care organizations out of some models. Finally, by including the alternative pure percentage of benchmark standard for nominal financial risk CMS already has an alternative for larger health care organizations for whom the benchmark standard may only represent 15% of revenue or less for larger health care organizations. By having both a pure revenue standard and a pure percentage of benchmark standard, CMS ensures that all APM entities are taking on more than nominal financial risk while still allowing flexibility to account for the incredible diversity that is some larger health care organizations.

ACO Track 1+ Model
The most obvious work left undone by MACRA is having an ACO that matches the risk standards finalized in MACRA. We believe it is imperative that CMS implement an ACO model that does so as quickly as possible. We field questions everyday as to whether our ACOs will move to two-sided risk. Every day that goes by where we have to say we do not know is a lost opportunity. We continue to believe that the most straightforward way to implement just the new risk standards would be through the MSSP itself.

This risk can be easily integrated as a stop loss scenario into Track 2 and Track 3 with the addition of one line of regulation text each for Track 2 and Track 3 MSSP ACOs. Changes are in bold with higher risk for Track 3 due to its higher reward.

For Track 2: 42 CFR 425.606 (g)
(3) 3 percent in the third and any subsequent performance year, or
(4) 8 percent of the Medicare Parts A and Part B revenue of the ACO participants in any performance year 2017 and 2018.

For Track 3: 42 CFR 425.610
(g) Loss recoupment limit. The amount of shared losses for which an eligible ACO is liable may not exceed 15 percent of its updated benchmark as determined under § 425.602 or 15 percent of the Medicare Parts A and Part B revenue of the ACO participants in any performance year.

However, we understand that CMS is on the path to implement it as an innovation model. This means there is at a minimum additional one additional piece of work to be accomplished. CMS must outline the reward that ACOs receive for taking on risk. While CMS may be tempted to see the 5% fee-schedule bonus as sufficient, we assure you it is not. First, many ACOs include participants who do not receive Part B payments in a significant way such as FQHCs, RHCs and hospitals. Secondly, most physicians (rightly or wrongly) believe they can achieve 5% in MIPS. Combining these two factors essentially negates the value of the 5% bonus for taking on risk. Finally, even in the rare scenario where all ACO participants only receive Part B payments the risk is still mathematically higher than the reward. The combination of these factors means it is imperative that the model itself offer reward for taking on risk. We recommend that CMS include in the model the potential for 60 percent shared savings for 8% of revenue risk and 75 percent shared savings for 15% of revenue risk.

As CMS is developing a new model we believe CMS can take this opportunity to focus on more than the risk reward tradeoff. The model can test other ways to bring the ACO model closer to measuring whether a person in the ACO get better care at lower cost than if the person had not in the ACO or a “difference in difference” approach.

We recommend CMS address two additional areas that are crucial towards moving physicians towards taking risk. First, CMS should change how it views risk adjustment. Rather than the current view of fear that it will lead to paying for coding, CMS should focus on the true purpose of risk adjustment which is make different populations comparable to one another. We have advocated, along with many others, for the last two years that to measure real ACO value risk scoring must accurately reflect the measured population. The artificial cap imposed by CMS on risk scoring turns ACOs into mini-insurance companies. This in turn scares ACOs away from two-sided risk because they are no longer responsible for just population health, but also statistical anomalies. This is the only area where CMS is not leading the accountable care movement, but falling behind commercial health plans.

The second important step CMS can take to measuring ACO value is to include regional inflation update factors instead of national inflation update factors in all contract years. CMS should seek to reward ACOs for the work they do in creating difference in difference ACO value not because they happen to be in a low cost or high cost area in any given year. CMS’s own analysis for their last regulations on the MSSP shows that very few ACOs can individually impact their area’s cost curve. Every ACO can impact whether the person got better care in the ACO than they did out of it. A regional inflation update ensures that the work of the ACO impacts the ACO’s financial future instead of regional cost arbitrage. ACOs have begun to calculate headwinds and tailwinds (i.e. is the benchmark lower or higher than the most recent year’s costs) to determine their likelihood of success. This is what CMS intended to reward areas with falling costs with more ACO participation. However, this intent has gone awry. First, rarely does any individual ACO have significant impact on their regional costs so the reward or penalty is not due to the past work of the ACO participants. Second, ACOs have not been able to determine these headwinds or tailwinds prior to receiving ACO data from CMS so the phenomenon cannot drive increases or decreases in ACO participation. Given that the hoped for effects of this policy have not materialized it is time to revert to the more accurate measurement of regional inflation in benchmarking and annual update factors in the first contract and end the unnatural arbitrage opportunities national inflation updates are causing across the MSSP.

Other Payer Advanced APM Financial Risk Criteria
We strongly believe that CMS should use the exact same criteria for qualifying other payer APMs as advanced as those used for Medicare. Both payers and health care providers should be able to submit the parameters of their program for qualification as an AAPM. CMS should be as open as possible in disclosing the specific qualifying terms of the other payer APMs, but should offer enough proprietary protection so that a health care provider is able to submit the parameters on their own.

Definition of Certified EHR Technology
We believe that CMS should not attempt to create different versions of meaningful use (now referred to as Advancing Care Information) through the AAPM requirements. CMS should, as they finalized in this regulation, define use simply as use of Certified EHR Technology in the AAPM. Different AAPMs will have different health information technology needs. They will all have a need to keep medical records and to make those records available to patients, care givers and other health care providers which is why we support the requirement that the EHR Technology be certified, but specific uses, measurement of those uses and the effects on the financials of the AAPM should be allowed to vary significantly from AAPM to AAPM.

Virtual Groups
Not all MIPS eligible clinicians are ready to participate in an APM. By laying out the framework for the virtual groups, CMS can make it a viable alternative for physicians in 2018. By serving as an alternative to consolidation, virtual groups can stem the revenue shift from small to large practices projected in the impact statement which in turn stems consolidation and preserves competition. We put forward a potential outline of virtual group as part of our comments.

How a virtual group is formed:

  • Voluntary election by physicians to be in a virtual group prior to the start of the performance year
  • Agree to work together to improve quality and other elected components of MIPS
  • Must agree to be scored on quality component
  • Can elect to be scored on
  • Clinical Practice Improvement Activities
  • Advancing Care Information
  • Resource Use
  • Can utilize any reporting method including Group Practice Reporting Option (GPRO)
  • Identify to CMS the officer responsible for the virtual group’s reporting

CMS already has several online systems for physician interaction regarding quality such as Quality Net, EIDM and HPMS. Any one of this could be adapted to record the grouping of the Taxpayer Identification Numbers that represent practices and to collect the election of which components of MIPS to be scored on.

Governance of the Virtual Group:

  • Establish a board with beneficiary representation to govern the virtual group
  • Empower an officer to take responsibility for the virtual group’s reporting
  • Establish a compliance officer
  • Conduct at least quarterly group reviews of their work toward improved quality

Responsibility of the Virtual Group:

  • The physicians and other eligible professionals agree to be scored as a group for purposes of MIPS
  • The virtual group is responsible for ensuring group reporting (i.e. CMS should not be responsible for aggregating the data across practices except in the area of resource use and other claims based measures)
  • The virtual group should have the capability to generate practice level information within the group (CMS will provide scoring at the virtual group level)

Limitations of the Virtual Group:

  • The sole purpose of the virtual group is to comply with MIPS reporting and it does not infer other advantages to the practices in regards to waivers or other exceptions
  • Virtual groups seeking additional group activities should seek to become an existing, more advanced group such as a clinically integrated network and/or an accountable care organization
  • Practices commit to a minimum of one year to being scored under MIPS as part of the virtual group

Preserving True Choice via Diversity of Organization and Universal Standards for Outcomes

Healthcare delivery is inherently local. Every community has its own history; its own needs; and its own resource base. This is especially true in Maryland, with unique communities among its beautiful coasts, soaring mountain ranges, and vibrant urban areas. Indeed, Maryland’s strength comes from this diversity, which is carefully maintained through the deliberate promotion of thoughtful policy, purposeful actions, and local solutions.
In a similar fashion, the Maryland Comprehensive Primary Care Proposal must deliberately promote strategies to strengthen and advance diversity among providers and Care Transformation Organizations (CTOs).
The proposal highlights a desire for competition among Care Transformation Organizations (CTOs); we wholeheartedly agree that competition is the best tool for improvement. However, competition can present tremendous challenges, especially in health care, and many organizations will seek to minimize the level of competition for their own benefit. Competition in health care must be deliberately supported through the selection process and model design so that various options present attractive options on their own, aside from the need to subsidize the CTO-practice relationship. Prior models have shown this to be the case; indeed, the recent trend towards consolidation is evidence enough.
The CTO selection process should not just value having two or more options for practices, but rather seek different types of CTO offerings. By example: choosing between two systems whose integration is based on common ownership is fundamentally different that choosing between a wholly-owned integrated system and a networked system whose integration is based on shared patients and shared data.
An effort to spur and maintain true competition among CTOs would enhance the strength of the state’s Proposal and greatly increase its chances of success.

Reinforcing the Primary Care Physician – Patient Relationship

Every Medicare beneficiary benefits from a strong primary care physician relationship. Primary care physicians “quarterback” their patients’ health care. Those who do so in their own practices maintain the independence that makes their practices unique and trusted.
There are certainly rare cases where the only health need a patient has in a year is a singular acute issue. There are also cases, usually towards the end of life, that a patient’s needs are so intensive they are removed from the community.
However, most health care needs—and most health care spending—are driven by patients with multiple chronic conditions or who suffer from preventable or otherwise avoidable illnesses and injuries. These patients remain in their community, and benefit most from the one-on-one relationship with their primary care physician.
Attribution should revolve around that relationship and the model CTO – practice contract should seek to preserve that relationship. Only in the rarest of cases where it is inescapably obvious that primary care is no long primary to the patient’s health care needs for a given year should specialist or facility attribution be employed.

Last Friday, the Centers for Medicare & Medicaid Services (CMS) released the highly anticipated final regulations implementing the Medicare Access and CHIP Reauthorization Act (MACRA). MACRA creates two value driven ways of interacting with CMS: Advanced Alternative Payment Models (AAPMs) and the Merit-Based Incentive Payment System (MIPS). Here is what you need to know about each. CMS listened to and responded to a vast array of comments from health care stakeholders. I believe the rule will move the country to where doctors are reimbursed for quality and value not volume. In creating a clear path for small, independent physicians to embrace the transition to value, CMS makes it possible for leading independent practices to reduce costs, boost outcomes, and thrive.

Advanced Alternative Payment Models: What You Need to Know

Most commonly taking the form of accountable care organizations and bundled payment initiatives, the defining characteristic that make an alternate payment model “advanced” is risk. Risk is usually simply defined as poor performance means I will have to write CMS a check. The critical question was how big does the check have to be to qualify. CMS originally proposed that the check had to be a percentage of the denominator in the model so in an ACO a percentage of total cost of care or in bundles a percentage of the total bundle price. Yet as we detailed in blog posts (here, here and here) as well as in our formal comments to the proposed rule this would have disadvantages smaller, physician-led groups that represent only a small percentage of the total cost of care.

Therefore, we are very pleased to see CMS simplify how they measure the amount of risk and relate it to the financial resources of those participating in the APM entity. CMS recognizes that not all APM entities have the same financial resources so it is impossible to use the same standard for all and claim that the risk is merely more than nominal for all of them.

CMS finalized for 2017 and 2018 that risk representing 8 percent of the Medicare Part A and Part B revenue received by participants of the ACO or other APM would qualify the APM as advanced. CMS also indicated that this could ramp up over time to as much as 15 percent in later years. This would ensure that participation in an AAPM always entails more risk than participation in MIPS, a goal we support.

Advanced Alternative Payment Models: What to Watch For

This is just the first step. Today no two-sided risk APM takes advantage of this motivational level of risk. CMS indicates in it regulation that updates to existing APMs are coming very quickly. In particular CMS talks about a MSSP Track 1+ that would take advantage of this lower risk track in time for physicians to be in it for 2018 which would affect their payments in 2020. We look forward to seeing CMS move quickly to catch their various models up to this final rule.

While not an issue for most ACO participants, physicians should be aware that they must have at least 25% of their Medicare Part B services or at least 20% of their Medicare Part B patients attributed to the APM to individually qualify for the 5% bonus payment. Nearly every primary care physician in an ACO model will easily push past these thresholds, but specialists and physicians in other models should be wary of this provision especially as it ramps up to 50% and 35% respectively in 2021 (reporting year 2019) and all the way to 75 and 50% in 2023 (reporting year 2021).

Medicare Incentive Payment System: Need to Know

CMS recognized that with 2017 starting in just two and a half months and calls 2017 what it was always going to be: a transition year. To successfully navigate the transition year there are two number to know: 3 and 70. 3 is how many points you need in 2017 to avoid any penalty in 2019. 70 is how many points you need to gain access to the $500 million exceptional performance bonus pool that Congress created.

MIPS is divided into four categories that total up to 100 possible points.

2017 Breakdown of Points by Category

Category

MIPS only Points

MIPS with ACO Points

Quality

60

50

Improvement Activities

15

20

Advancing Care Information

25

30

Cost

0

0

 

2018 Breakdown of Points by Category

Category

MIPS only Points

MIPS with ACO Points

Quality

50

50

Improvement Activities

15

20

Advancing Care Information

25

30

Cost

10

0

 

To get the 3 points you need only successfully report one measure for one category. This prevents any 2019 negative payment adjustments. A low bar to be sure, but you must interact with CMS in 2017 at least this much or you will receive a negative 4% adjustment in 2019.

Because CMS expects most physicians to at least report one measure, there will not be a lot of positive payment adjustments available under budget neutrality rule. This means most of the positive potential in MIPS is tied to the exceptional performance bonus pool. To access this pool, you must report at least 90 days preferably the whole year and earn at least 70 points. While it appears possible to get there while ignoring one of the categories other than quality this is not advisable. Each category has some built in low hanging fruit (for example you get 50% of the points in Advancing Care Information just for having 5 specific EHR capabilities) that should not be missed. Every organization should look into the three scored categories and plot their best way to get to at least seventy points.

To start you on that path, improvement activities is the easiest category and as mentioned you get 50% of the points in ACI just for fully implementation of your EHR. That is 22.5 points right there in MIPS only and 35 points in MIPS with ACO, certainly a solid base to start from. If you have done PQRS before, if you have done meaningful use before and certainly if you are in an ACO or other “non-advanced” APM then look into how you can be in that exceptional performance pool right away. If those things are new to you then take full advantage of 2017 as a transition year.

Medicare Incentive Payment System: What to Watch For

There are a lot of reporting submission options. Claims, registry, EHR, CMS web interface, CMS wants your data and they will take it however they can get it. If you are in an ACO your ACO quality reporting does double duty. If you aren’t in an ACO or ACO won’t be in its performance year in 2017 then you have to choose which option to use. The first consideration is what options are available to you. Is there a registry for your specialty, are you on an EHR those type of capability question. If you are capable of more than one, the second thing to keep in mind that each has its own benchmarks. So the benchmarks for CMS web interface are the same as the benchmarks used for the Medicare Shared Savings Program whether you are in an ACO or not. The benchmarks for EHR submission are based on past performance of those who submitted through EHR, etc. Benchmarks for most measures are published in advance and could influence your choice of submission method.

Bottom Line:

AAPM – Excellent news on right sized risk, but models that use it will come out in 2017

MIPS –   Must minimally interact with MIPS in 2017 to avoid penalty and if you are ready the bonus pool is within reach.