Accountable Care Organizations

CMS Hears and Responds to Physician Feedback Regarding MACRA

Posted by J. Nicole Martin on September 09, 2016
Accountable Care Organizations, CMS, HHS, Medicare / No Comments

CMS Hears and Responds to Physician Feedback Regarding MACRAOn September 8, 2016, CMS announced in its blog that it will allow physicians to select their level of participation for the first performance year of the Medicare Access and CHIP Reauthorization Act of 2015 (“MACRA”) Quality Payment Program, which begins January 1, 2017. Importantly, during the first performance year (2017), “[c]hoosing one of these options would ensure [physicians] do not receive a negative payment adjustment” under MACRA in 2019.

Under the Quality Payment Program physicians will fall under the Merit-Based Incentive Payment System (“MIPS”) if they do not qualify under the Advanced Alternative Payment Model (“Advanced APM”) option.  In 2019, physicians who are in the MIPS default option could face Medicare rate adjustments of up to 5% based on their performance under four weighted performance categories: quality (50%); resource use (10%); advancing care information (25%); and clinical practice improvement (15%). Advanced APMs include, for example, Track 2 and 3 MSSP ACOs; next generation ACOs; and bundled payment models, and physicians who qualify under the Advanced APM option earn a 5% incentive, are excluded from MIPS adjustments and receive higher fee schedule updates after 2024.

Recognizing that many physicians may face negative payment adjustments under MIPS as a result of participating under the Quality Payment Program, CMS is going to allow eligible physicians to “pick their pace of participation” and ensure they do not receive such negative payment adjustments in 2019 by choosing one of four options for the first performance year:

  1. Test the Quality Payment Program;
  2. Participate for part of the calendar year;
  3. Participate for the full calendar year; or
  4. Participate in an Advanced APM in 2017.

The first three options fall under MIPS, while the fourth option falls under the Advanced APM. In the first option, physicians could “submit some data to the Quality Payment Program”, avoid negative payment adjustments and test the waters before broader participation in subsequent years. Under option two, the performance year could begin later than January 1, 2017, a physician practice “could qualify for a small positive payment adjustment”, and a physician would submit Quality Payment Program information for fewer days. The third option is ideal for those physician practices that are ready to participate beginning January 1, 2017 and who are able to submit a full year of quality data. Additionally, physicians “could qualify for a modest positive payment adjustment.” The fourth option would be viable for those physicians or physicians groups who treat enough Medicare beneficiaries and who receive enough of their Medicare payments through an Advanced APM (e.g., MSSP ACOs). Through the Advanced APM option, physicians/physician groups would “qualify for a 5 percent payment in 2019.” It remains unclear what the difference is between a “small” and “modest” payment adjustment. However, CMS may address this in the final rule along with how it will implement MIPS and the Advanced APM. CMS will release the final rule by November 1, 2016.

For more information about MACRA, contact Chris Raphaely, Nicole Martin or a member of Cozen O’Connor’s Health Law team.

J. Nicole Martin

J. Nicole Martin

J. Nicole Martin is an associate and practices in the Health Care Practice Group. Nicole assists accountable care organizations, health care systems, long term care providers, behavioral and mental health providers, medical device manufacturers, physician practices and pharmacies with their compliance, regulatory and transactional needs. Nicole’s practice includes providing clients with counsel regarding HIPAA/HITECH and state privacy and security laws, data breaches, business associate and covered entity obligations, licensure laws, Medicare, Medicaid and third-party payer matters, medical staff issues, and fraud and abuse laws. Nicole also represents clients undergoing changes of ownership and changes of control, and assists them with the transactional, regulatory and compliance requirements necessary to finalize the transactions.

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CMS’ Long Awaited Final ACO Regulations for 2016 and Beyond: Major New Options and Plenty of Fine Tuning

Posted by Chris Raphaely on June 08, 2015
Accountable Care Organizations, Beneficiaries, CMS, Final Rule, Medicaid, Medicare / 1 Comment

Tomorrow, the Centers for Medicare and Medicaid Services (“CMS”) will publish final regulations (“Final Rule”)  for its flagship pay-for-performance program, the Medicare Shared Savings Program, in the Federal Register. The Final Rule generally applies to performance years 2016 and beyond and the second three year “agreement period” for the over 400 accountable care organizations (“ACO”) currently in the program.

Stakeholders watched very closely the development of the Final Rule, so they can now begin sizing up future opportunities with some certainty and determine the longer term complexion of the program itself. The regulations contained in the Final Rule were published in proposed form in December 2014, and, the Final Rule adopts most, but not all, of what CMS initially proposed.  It continues the pattern of easing CMS’ ultimate push towards the two-sided risk model for most, if not all, ACOs and contains adjustments that many will consider to be favorable to ACOs.

Among the most significant developments is one in which, as proposed, ACOs that are currently in their first three year agreement period with CMS for participation in the program’s “upside only” risk model, Track 1, will be permitted to remain under the same model for another three years. This covers the majority of ACOs currently in the program. Significantly, however, CMS declined to institute the 10% cut (from 50% to 40%) to the Maximum Savings Rate for the second term Track 1 ACOs that it proposed last December.  The Final Rule comes none too soon for the first set of Track 1 ACOs who will have to make a decision whether or not to re-up for another three years in the program before the end of 2015.

In the other major structural change to the program, CMS, as it proposed to do, created a third double-sided risk, Track 3, for more highly developed ACOs desiring to trade greater upside opportunity (up to a 75% share of savings generated) for greater risk (up to 75% of losses) with both savings and losses being subject to a cap of 15% and 20% of benchmark, respectively. The new track includes a prospective beneficiary assignment model as opposed to the retrospective model that will continue to be used in Tracks 1 and 2. CMS also gives ACOs who choose the new track the option to waive Medicare’s three day hospital stay requirement for reimbursement of skilled nursing services. CMS stated that it will be considering additional waivers in areas like tele-health for Track 3 ACOs in the future.

CMS also included many technical adjustments to the program, some of which will have a significant impact on how the program and ACOs operate. Among the more significant are the following:

  • Adjusting the savings benchmark calculation so second term ACOs that generated savings in their first term are not “penalized” by tougher savings targets in the second term as a result;
  • Track 2 and Track 3 ACOs will be given new options for setting Minimum Savings and Loss Rates;
  • Greater emphasis on primary care services provided by non-physician practitioners such as licensed nurse practitioners in the beneficiary assignment process;
  • Enhanced information in the aggregate data reports supplied to ACOs and the inclusion of patients who had one primary care visit with an ACO in the assignment period even if they were not
    preliminarily assigned to the ACO in the aggregate reports supplied to Track 1 and 2 ACOs; and
  • A streamlined data opt-out process in which (i) beneficiaries opt out of data sharing only by notifying CMS directly; and (ii) ACOs no longer have to wait thirty days after notifying beneficiaries of their opt-out rights before requesting detailed claims data on such beneficiaries.

The balance of 2015 and 2016 will be critical to the future of the Medicare Shared Savings Program as ACOs who currently participate in the program and others who are considering participation now have definitive guidance as to what the program will look like at least through 2018.

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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HHS Ups The Ante: Announces Percentages And Time Frames On Goals For Medicare Pay-For-Value Efforts

Posted by Chris Raphaely on January 27, 2015
Accountable Care Organizations, Affordable Care Act, CMS, HHS, Medicaid, Medicare / No Comments

On January 26, 2015, the Secretary of the United States Department of Health and Human Services (“HHS”), Sylvia Mathews Burwell, announced two important goals for the Department:

  1. Increase the percentage of Medicare provider payments that are made through alternative payment models based on how well the providers care for patients, rather than the amount of care provided. The percentage goals for these alternative payment models are 30% by 2016 and 50% by 2018.
  2. Tie virtually all Medicare fee-for-service payments (85% in 2016 and 90% in 2018) to quality and value.

This announcement puts hard numbers on the goal to move away from traditional fee-for-service Medicare payments that has been stated generally since at least 2010 when the Affordable Care Act was enacted. By clearly delineating specific figures for alternative payment models, such as accountable care organizations and bundled payment arrangements, from those figures for payment methods, HHS has made it clear that providers should be thinking not just about different forms of payment but different forms of organizations and relationships with other providers. Alternative payment models generally require coordination among different types of providers who may not otherwise be related to each other.

While the announced goals focus on the Medicare fee-for-service system, it is clear that HHS intends the impact of these goals to be far broader. Ms. Burwell also announced the creation of a Health Care Payment Learning and Action Network to facilitate a public-private sector partnership to “continue to build on our work with state Medicaid agencies, private payers, employers, consumers and other partners,” while welcoming the fact that “our partners in the private sector have the opportunity to be even more aggressive” in establishing alternative payment models and pay-for-value compensation systems. On the same day as Ms. Burwell’s announcement, the Centers for Medicare and Medicaid Services released a fact sheet stating that it is taking action with a goal to spend “our health dollars” more wisely, citing the importance of the goal for patients, families, providers, tax payers, employers, states and insurance companies, and making it clear that HHS and CMS fully intend to have their efforts to transform health care delivery and payment systems to reverberate well beyond the Medicare program.

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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CMS Announces Latest Group Of MSSP ACOs And May Allow ACOs To Remain As “Upside-Risk Only” Longer

Posted by Chris Raphaely on December 29, 2014
Accountable Care Organizations, CMS / No Comments

December has been a busy month for CMS with respect to the Medicare Shared Savings Program (“MSSP”). Last week CMS announced that eighty-nine (89) more ACOs would begin participating in the MSSP starting in 2015, bringing the total number of ACOs in the program to four-hundred and five (405). Continue reading…

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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CMS Releases New Proposed Medicare Shared Savings Program Regulations

Posted by Chris Raphaely on December 03, 2014
Accountable Care Organizations, CMS, Medicare / No Comments

The Centers for Medicare and Medicaid Services (“CMS”) released proposed  regulations for the Medicare Shared Savings Program (“MSSP”) on Monday December 1, 2014.  The proposed regulations are scheduled to be published in the Federal Register on December 8, 2014, and those wishing to submit comments to the agency will have sixty days after their publication in the Federal Register to do so. CMS stated that the regulations will generally be effective sixty days after they are published in final form.

CMS’ discussion and the proposed regulations span over 400 pages and cover many   operational details of the MSSP.  Some selected highlights are noted below:

  • CMS proposes to permit ACOs currently enrolled in the MSSP’s “upside risk only” model to continue to participate in the “upside risk only” model for a second “agreement period” with a reduced shared savings rate.
  • CMS proposes to create a new “track 3” “upside/downside” risk model with higher rates of savings and the prospective attribution of beneficiaries.
  • CMS proposes to place a “greater emphasis on primary care services delivered by nurse practitioners, physician assistants and clinical nurse specialists in the beneficiary assignment process, and to eliminate the exclusivity requirement for certain specialists that were previously required to be exclusive to one ACO on the basis that they render some services that are considered primary care services.
  • CMS proposes to eliminate the requirement that ACOs send out data sharing “opt out” letters to beneficiaries and would require beneficiaries to opt out of data sharing exclusively by contacting CMS as opposed having the option to opt out by contacting the ACOs directly.

The health care industry will be digesting CMS’ voluminous and in some cases highly technical proposed changes to the MSSP over the next 60 days and the Health Law Informer will continue to provide more details regarding these regulations and the industry’s reaction to them.

To read the complete text of the proposed regulations click here.

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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CMS Announces Program to Fund ACO Growth, Extends Fraud and Abuse Waivers

Posted by Chris Raphaely on October 16, 2014
Accountable Care Organizations, CMS, OIG / No Comments

The Centers for Medicare & Medicaid Services (“CMS”) announced a new initiative, the ACO Investment Model, on October 15, 2014.  Under the model, ACOs which are made up of “providers [who] lack adequate access to … capital” may receive additional funding from the CMS “to invest in infrastructure necessary to successfully implement population care management.” The eligibility criteria are as follows:

  • The ACO must be accepted into and participate in the Medicare Shared Savings Program. The ACO’s first performance period in the Medicare Shared Savings Program must have started in either 2012, 2013 or 2014 or will start in 2016.
  • The ACO has completely and accurately reported quality measures to the Medicare Shared Savings Program in the most recent performance year, if the ACO started in the Medicare Shared Savings Program in 2012, 2013 or 2014, excluding ACOs that will start in 2016.  The ACO has a preliminary prospective beneficiary assignment of 10,000 or fewer beneficiaries for the most recent quarter, as determined in accordance with the Shared Savings Program regulations.
  • The ACO does not include a hospital as an ACO participant or an ACO provider/supplier (as defined by the Shared Savings Program regulations), unless the hospital is a critical access hospital (CAH) or inpatient prospective payment system (IPPS) hospital with 100 or fewer beds.
  •  The ACO is not owned or operated in whole or in part by a health plan.
  •  The ACO did not participate in the Advance Payment Model.

Continue reading…

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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CMS and ACOs: A Busy Summer and a Busier Fall

Posted by Chris Raphaely on August 05, 2014
ACA, Accountable Care Organizations, Affordable Care Act, HIPAA, HITECH, Medicare, Privacy / No Comments

 

It has been a busy summer so far for the Centers for Medicare & Medicaid Services (CMS) with respect to Accountable Care Organizations (ACOs), as the agency has proposed altering the quality reporting measures under the Medicare Shared Savings Program (“MSSP”) for 2015 and beyond.  Expect an even busier fall as other, potentially broader, proposed rule changes for ACOs are analyzed by the Office of Management and Budget (OMB) and both sets of proposals wind their way through the public comment process.

The proposed changes concerning quality reporting would revise and update the measures used to evaluate MSSP ACOs’ performance. Overall, the CMS says it would like to focus more on outcome-based measures (as opposed to process-based measures), reduce duplicative measures, and reflect current clinical practices without increasing ACO’s reporting burden.

More specifically, the CMS proposes to add 12 new measures and remove eight, which would increase the total number of quality measures from 33 to 37. The new measures relate to “avoidable” admissions for patients with multiple chronic conditions, heart failure, and diabetes; depression readmission; readmissions to skilled nursing facilities; patient discussion of prescription costs; and updated composite measures for diabetes and coronary artery disease.

The CMS would like to modify the scoring system to award bonus points toward shared savings to ACOs that make year-over-year improvements on individual measures. Moreover, the agency would like to modify its benchmarking methodology to use flat percentages to establish the benchmark for a measure when the national FSS data results in the 90th percentile being greater than or equal to 95 percent. And, finally, the CMS proposes several ways to align MSSP reporting requirements with other reporting programs, including Medicare’s Electronic Health Records Incentive Program and the Physician Quality Reporting System.

Fewer details are available about the next set of proposed rules changes, which were submitted to OMB on June 26 and will be printed in the Federal Register after review. It is expected that these regulations will include changes to the MSSP’s payment provisions. The proposed changes would apply to existing ACOs and approved ACO applicants starting January 1, 2016. As soon as the text of the rule becomes publicly available, the Health Law Informer will provide more information.

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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ACOs and Pay for Value … All About the Data

Posted by Chris Raphaely on July 24, 2014
Accountable Care Organizations, Affordable Care Act, HIPAA, Privacy / No Comments

It has been over three years since the Centers for Medicare and Medicaid Services (CMS) announced its proposed rule and guidance on the development and implementation of Accountable Care Organizations.  About four million Medicare beneficiaries are now in an ACO, and over 400 provider groups are participating in ACOs.  See February 19, 2013 Health Affairs Blog. An estimated 14% of the U.S. population is being treated within an ACO. See April 16, 2014 Kaiser Health News.

By all indications, these numbers will continue to grow as the US health system moves away from the fee-for-service model to pay for value models that reward quality and cost savings and require clinical coordination among different types of providers, in many cases providers who are unrelated other than through an ACO or other similar arrangement.  The seamless sharing of data, patient information and collaboration among large, medium and small physician practices, hospitals, post-acute providers, and even private companies like pharmacy chains is critical to the success of these organizations. Continue reading…

Chris Raphaely

Chris Raphaely

R. Christopher Raphaely joined Cozen O'Connor's Philadelphia office in 2014 as co-chair of the Health Care Practice Group. Chris joins the firm from Jefferson Health System, where he served as deputy general counsel and general counsel to the system’s accountable care organization and captive professional liability insurance companies.

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