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At the World Health Care Congress, a Probing Discussion of the Shift Towards Value

April 30, 2018
by Mark Hagland
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Industry leaders parse some of the complexities around the shift towards a value-based healthcare system

What is the path into value-based care in U.S. healthcare going to look like in the near future? Somewhat rocky, that’s for certain. That certainly was the consensus among industry leaders participating in the opening panel Monday morning at the 15th Annual World Health Care Congress, being held this week at the Marriott Wardman Park Hotel in Washington, D.C.

With the title, “Make Value-Based Care a Reality,” panel participants, drawn from across the sectors of U.S. healthcare, engaged in a very lively discussion about the challenges, opportunities, and complexities of the shift taking place in the U.S. healthcare system from a payment system that remains fee-for-service-based for the most part, to an emerging system that will be incenting value to all stakeholders in the system.

The panel was moderated by Ceci Connolly, president and CEO of the Washington, D.C.-based Alliance of Community Health Plans, a national association of 49 community health plans. Connolly was joined by Phil Jackson, CEO, health plan products, at the Sacramento-based Sutter Health, an integrated health system with 24 hospitals across Northern California; Paul Kusserow, president and CEO of the Washington, D.C.-based Amedisys Inc., a nationwide home healthcare provider; Karen Spring, president, healthcare operations, at the St. Louis-based Ascension Healthcare, the nation’s largest Catholic-affiliated integrated health system, with 153 hospitals; and Matt Wallaert, chief behavioral officer at Clover Health, a San Francisco-based health plan that describes itself on its website as “a software driven health insurance company leveraging data analytics and technology to partner with providers to fill gaps in care and help drive clinical operations workflow.”

In introducing herself at the beginning of the discussion, Ascension’s Spring said,  “We’re the nation’s largest not-for-profit health system, and we’re actually the world’s largest Catholic healthcare organization. We’ve been structured around people being sick. And we know we need to move towards prevention and wellness. The tertiary care hospitals will all be there. But we need to be in our communities. We have 153 hospitals, and senior living. What we need to be focused on is how we keep people from needing our hospitals, how we help them to feel better about life.”

Further, Spring said, “In Nashville, for example, we have high smoking rates, obesity, diabetes, which means we need to do better. We want to make communities healthier. And we took a bold move this year, for example… last year, we were able to reduce CHF readmissions across all our entities; this year, we’ve focused on not even to admit CHF patients to begin with. We’re about 50 percent at risk—combination of full risk, shared risk, and MSSP ACOs [Medicare Shared Savings Program accountable care organizations]. We haven’t moved as fast as we’d hoped we would. But reimbursement remains a challenge,” added Spring, who noted that she began in healthcare as a practicing nurse in the mid-1980s, and has been with Ascension Health for seven years.

“We are now the largest independent home health, hospice, and personal care company in the country,” said Kusserow, who noted that Amedisys Home Health employs 18,000 healthcare professionals working in 35 states. “Our major competitor is being acquired by a payer. So in people’s attempts to move towards value-based purchasing and delivery, we’re starting to see a lot of influence in terms of the payers and providers getting together, to deliver strong value. Today,” he noted, “we will be in 45,000 homes calling on people. Our job is really simple: to allow people to live independently in their homes. And the Baby Boomers don’t want to be in institutions. And we’re moving very quickly from an acute-based system to a chronic care-based system.”

One key element in that, Kusserow noted, is the aging of the population, and the growing percentage of seniors in the U.S. “People are expecting to live 20 years beyond the age of 65, and at 65, you first start to typically exhibit a chronic illness. Most of our business is FFS. I come from a payer background, also ran hospitals for seven years as well. So I’ve been in a lot of places in the HC system. I think the paradigm is shifting. Payers are acquiring providers, and are going to achieve value that way. And the key paradigm shift will be to keep people out of institutions.”

“I’m a social psychologist by training,” Wallaert said, in introducing himself to the audience. “We all have the same end goal: happy, healthy people. So to me, it’s about motivational systems. It’s sort of crazy to me that I’m the only chief behavioral officer in the industry,” he continued. What’s more, he said, “Money isn’t the only motivator; meaning is also a motivator. No one goes into medicine purely to make money. People go into medicine to help people, and then we very quickly extinguish that motivation by creating payment systems that aren’t value based. Clinicians are required to ask patients, ‘Did you get a flu shot? You should get a flu shot.’ It turns out that 80 percent of our members don’t even want a flu shot. It’s about motivation.” He told a humorous story about noticing how attendees who partook of breakfast downstairs in the hotel’s atrium had the option of taking an escalator up to the ballroom level for this session, or taking a flight of stairs. He said, “On the one hand, I could stand at the foot of the stairs with a stack of $1 bills and offer each attendee $1 to climb the flight of stairs. But there could also be more motivational ways of convincing them to take the stairs. There’s more than one way to change behavior; it doesn’t just have to be standing at the escalator and stairs with a pack of dollar bills. So how do we motivate people?” That, he said, will be a profoundly important question, as members of healthcare stakeholder groups, including both patients/plan members and clinicians, are faced with the potential to modify their behaviors within the healthcare system.

Sutter’s Jackson, in introducing himself, provoked audience smiles, when he noted that, as an anthropologist, “I spent my graduate school career studying primate behavior”—with a wink and a nod to any possible applications in healthcare system dynamics. “From our perspective at Sutter,” he then said, “entering into value-based models is less about the incentive for individual behavior, but rather moving towards capitation. Capitation gives us more of an opportunity to bring care and coverage together. In a traditional health plan-provider contractual relationship, there’s a lot of tension there. What we’re trying to do, by owning and operating our own plan or entering into a partnership with an organization like Aetna—the fact is that owning and creating a budget gives us the incentive to produce high-quality, cost-effective care.”

Going on, Jackson said, “We need a much faster, more accelerated level of transformation. And we think that capitation, and owning or financing part of the overall cost of healthcare, will give us the motivation to transform.” And, within that context, Jackson said, it will be very important to leverage all forms of technology in order to bring care management into “the home or office. We’re meeting patients or members where they want care. I used to work with a guy who talked about the ‘tyranny of the office visit,’ where you have to drive to a physician office, drive, and try to find a parking space, for a 15-minute doctor visit,” he said. “So we’re trying to stratify the service to fit what patients need, including their quality of life. We spend a lot of time talking about financing, contracting, payment, etc. I really appreciate that we’re talking about engaging people where they are.”

“In looking at this shift from a system focused on acute care, to one focused on chronic care, what are the implications, and/or opportunities?” Connolly asked.

“I managed hospitals, then worked for Humana for several years,” Kusserow said. “The real thing that’s occurring, as we looked at our 5 million members, we started to put people into buckets,” with regard to how to manage their care. He noted that many people are now living with cancer who previously would have died from it. Meanwhile, congestive heart failure (CHF) and COPD (chronic obstructive pulmonary disease) “have become quite chronic. And to manage chronics, you need information flow.” He noted that, “In the 1980s, we built something around acute-care episodes. And one thing I learned in the hospital business is that you can’t develop a continuum of care, including information, around patients,” based solely on the information that can be gathered from inpatient hospital stays. “Take myself as an example,” he said. “I’ve been in the hospital once in ten years. What do they know about me? They know nothing. So the whole idea is, if you start to build data,” it’s possible to build the foundations of population health data vehicles.

Recentering care management towards the home

The key question, Kusserow said, is this: “As people get sicker and sicker with chronic illnesses, how do you keep them healthier? And the centering is beginning to focus on the home. And moving towards less-expensive venues. That’s why you’re seeing payers acquiring ambulatory surgery centers and home health. And hospitals and doctors will have to figure out now how we hold these people and keep them from being admitted to hospitals.”

“We have all this data,” Wallaert said. “But we need you to be ready and receptive to receive it, too. That’s the other half of this. How do we surface data to you providers, so that you can come back and use that data?”

“That’s why we have to move away from being hospital-centric,” Spring emphasized. At Ascension, she noted, “We are a clinically integrated system of care, which means we have sites of care where people are, whether in primary care settings or anything else.”

“For a long time, the pickle for so many healthcare organizations has been, if you do your job well, you’re going to have fewer bodies in beds, and that means less revenue,” Connolly said. “How do you manage that?”

“Last year, we did about $1.8 billion in charity care and caring for those who are uninsured and under-insured,” Spring reported. “So for us, embracing that means taking a stance, and understanding that we’ll have less revenue as we move forward, so that’s a rough road. But as a Catholic healthcare organization, we’ll just take a stance that we’ll have a smaller margin this year. Still, if our market share is based on how many inpatient beds we have—that’s not driving you forward. So it has to be around the lives we’re caring for. Using that as a metric would really help us move forward.”

With regard to maintaining core mission while moving forward into the new healthcare, Sutter’s Jackson noted that, “As a not-for-profit, vision-based organization, we’re bound to care for the community; and we consider ourselves stewards of community assets. And it’s clear that the pressure on the cost of commercial health insurance for the employer, with the demographic increase in Medicare, etc., is pushing us towards an unsustainable system. And as a health plan guy, I see us as all cost centers, not revenue centers. And if you’re driving down bed days or admits, the benefit of that is accruing to the delivery system, so that the system can manage the cost of care and translate that into more affordable premiums in the market. We tend to look at things in terms of one-size-fits-all healthcare system. And we have to learn that there are other community partners that are as good as, if not better than, us, in terms of what we can deliver, and we need to partner with them.”

“Let’s tie this into the pay portion of this conversation,” Connolly said. “Paul or Matt, where does the money fit into this? Who gets paid to do what or not do what?”

“The silo-ization is part of the problem; you have to pay on outcomes, because you don’t know which lever will be the right one,” Wallaert said. “What we’ve been bad at as a healthcare system is the horizontal layer. I always tell a story about Walmart: they were trying to solve a problem, and when they brought that problem to engineers, they came up with an engineering solution, and when they brought it to the marketing people, they came up with a marketing solution. That’s why these micro-payment systems are really dangerous: ‘We’ll pay you $10 to talk with patients about this one thing.’ That’s where value goes to die,” he said.

“I think there are ways to approach this,” Kusserow said. “I’ve been in home health for three years, after being on the health plan and hospital sides. We have an RN develop a patient assessment, and the RN consults with a doctor; and we create a care plan. So we basically bet on our care plans, and we’re willing to take risk on that, because the types of care involved—combining unskilled and skilled care, fundamentally, you can get a good enough read that can start to monitor any change in health status. But it’s all data, setting the health plan, having a trajectory to monitor care and health status—and you have to keep doing it and doing it,” he added. “And frankly, we’ve found that the other element is motivation, on the part of the patient—the desire to stay in one’s home, the desire to work with one’s loved ones, will drive very strong outcomes.”

“And using those pathways and care plans, you have to eliminate variation,” Spring said. “But you also have to have the right systems in the community. It takes a village to raise a child, it takes a village to care for a community. Working with the churches and the food banks. Well, is it our responsibility? Well, we believe in it. We want to be the quarterback of all the services that need to be coordinated in the community So that’s a value. But you have that, you have to have access points to provide for a lower cost of service. So expanding access is the most painful thing. And having a social worker and a pharmacy tech and others, who can support a community, that’s important. We can’t ask a physician to take that on as well; that’s really not their wheelhouse. But providing all those supports, we can meet those needs. Partnering with the Ys, etc. But there are a lot of coordinates involved. We talk about healthcare being an art and a science; this will really become an art, in terms of how to coordinate a community.”



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Healthcare Industry Could Save $12.4B With Full Adoption of Electronic Transactions

January 17, 2019
by Heather Landi, Associate Editor
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The healthcare industry continues to make progress automating business processes, but significant gaps remain, representing an opportunity for $12.4 billion in savings through further automation, according to new data from the 2018 CAQH Index.

Electronic adoption and transaction volume increased in 2018, with several common transactions reaching 80 percent electronic adoption across the sector, according to the latest CAQH Index. This progress resulted in a narrowing of the cost savings opportunity for the first time in CAQH Index history.

CAQH is a Washington, D.C.-based non-profit alliance of health plans and trade associations. The findings from the 2018 CAQH Index are based on voluntary nationwide surveys of providers, as well as commercial medical and dental health plans. Participating medical health plans represent over 160 million covered lives—nearly 49 percent of the commercially insured U.S. population—and 7.8 billion transactions conducted in 2018.

The sixth annual CAQH Index is an annual report tracking the adoption of HIPAA-mandated and other electronic administrative transactions between healthcare providers and health plans in the medical and dental industries. These transactions include verifying a patient’s insurance coverage, obtaining authorization for care, submitting a claim and supplemental medical information and sending and receiving payments. The CAQH Index also estimates the annual volume of these transactions, their cost and the time needed to complete them.

By benchmarking progress, industry and government can more easily identify barriers that may be preventing stakeholders from realizing the full benefit of electronic administrative transactions. These insights can prompt new initiatives to address and reduce barriers. For the report, data was submitted by medical and dental plans that cover roughly half of the insured population in the United States and providers representing a range of specialties.

After reporting modest progress over the past few years, the 2018 CAQH Index findings suggest more positive change is occurring in the industry overall. Healthcare industry stakeholders made progress on many fronts this year—in adoption of electronic transactions, reductions in the volume of manual transactions and reductions in the remaining savings opportunity.

“The results highlighted in the 2018 Index are encouraging,” Kristine Burnaska, director of research and measurement at CAQH, said in a statement. “Both providers and health plans are saving time and reducing administrative costs, but more effort is needed to significantly reduce the volume of expensive, time consuming manual processing.”

While the overall volume of transactions in the medical industry increased by 18 percent in the past year, the volume of manual transactions declined, falling 6 percent for health plans and 1 percent for providers, according to the CAQH Index.

Medical industry adoption of electronic eligibility and benefit verification increased six percentage points to 85 percent in 2018; adoption of electronic coordination of benefits rose to 80 percent in 2018, up from 75 percent in 2017. Adoption of electronic claim submission stands at 96 percent and 71 percent of healthcare organizations have adopted electronic claim status inquiries.

However, the healthcare industry made little progress in the adoption of other electronic administrative transactions—only 12 percent of organizations have adopted electronic prior authorization, although that is up from 8 percent the year before. Adoption of electronic claim payment stands at 63 percent and less than half of healthcare organizations (48 percent) have adopted electronic remittance advice processes.

However, continued efforts are needed to significantly reduce the volume of expensive, time-consuming manual transactions and adapt to the changing administrative needs of the healthcare system, according to the CAQH Index. The Index estimates that the medical and dental industries could save an additional $12.4 billion annually with full adoption of electronic administrative transactions, particularly through greater automation by providers, which could save an additional $8.5 billion.

During a period of rising transaction volume, the medical industry shaved $1.3 billion from its savings opportunity, bringing it to $9.8 billion.

The Index also highlights a substantial rise in overall transaction volume, growing in parallel with industry complexity. As these trends persist, the Index finds that the industry would benefit from updated standards, operating rules, infrastructure and functionality that can accommodate the increase in volume and growing complexity associated with the need to connect administrative and clinical data elements in value-based payment models.

“The industry is making progress,” April Todd, senior vice president, CORE and Explorations at CAQH, said in a statement. “But, we are at an inflection point where processes and technology must adapt to a healthcare system that is transitioning to value-based payment and becoming increasingly complex.”

The CAQH Index notes that industry complexity is growing in parallel with transaction volume. “As these trends persist, the industry will benefit from standards, operating rules, infrastructure and functionality that can accommodate both the increase in volume and the growing complexity associated with varying plan and payment models designed to increase the value and quality of healthcare for consumers. There is a need for all stakeholders to support initiatives that lay the groundwork for the future,” the report authors wrote.

The CAQH Index also issued a number calls to action for the healthcare industry, including focusing efforts to address cost savings opportunities. Several transactions offer the greatest potential for savings and should be the subject of attention—transactions include eligibility and benefit verification, claim status, remittance advice and prior authorization. The medical industry could save an additional $4 billion on eligibility and benefit verifications and $2.6 billion on claim status transactions by fully adopting electronic transactions, according to the CAQH Index.

CAQH also recommends accelerating standards and operating rule development and encouraging timely vendor adoption of standards and operating rules.


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Has CMS Just Tipped the Scales Towards Provider Alienation, in its ACO Final Rule?

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CMS’s release of its final rule on MSSP ACO participation has pushed the healthcare industry into a very fraught moment in the ongoing evolution of the ACO experiment

As Healthcare Informatics Associate Editor Heather Landi reported on Dec. 21, that morning, “The Centers for Medicare & Medicaid Services (CMS) on Friday morning published a final rule that makes sweeping changes to the Medicare Shared Savings (MSSP) Accountable Care Organization (ACO) program, with the goal to push Medicare ACOs more quickly into two-sided risk models.”

Indeed, as Landi noted in her report, “Referred to as ‘Pathways to Success,’ the Trump Administration’s overhaul of Medicare’s ACO program will redesign the program’s participation options by removing the traditional three tracks in the MSSP model and replacing them with two tracks that eligible ACOs would enter into for an agreement period of no less than five years: the BASIC track, which would allow eligible ACOs to begin under a one-sided model and incrementally phase in higher levels of risk; and the ENHANCED track, which is based on the program’s existing Track 3, providing additional tools and flexibility for ACOs that take on the highest level of risk and potential rewards. At the highest level, BASIC ACOs would qualify as an Advanced Alternative Payment Model (APM) under the Quality Payment Program.”

And, Landi noted, “Currently, the MSSP model includes three tracks and is structured to allow ACOs to gain experience with the program before transitioning to performance-based risk. The vast majority of Shared Savings Program ACOs have chosen to enter and maximize the allowed time under Track 1, which is an ‘upside-only’ risk model. MSSP Tracks 2 and 3 involve downside risk, but participation in these tracks has been limited thus far.”

One of the biggest points of contention in recent months as centered on how aggressive a push on the part of CMS to compel providers forward into two-sided risk would be desirable, or even wise. Some in the industry tried to put a positive spin on the “low-income” element of the program, with that term referring to smaller physician groups choosing to participate in the MSSP. On Friday morning, in response to the final rule, Travis Broome, vice president of policy at Aledade, a Bethesda, Md.-based company focused on physician-led ACO development, tweeted, “One more change to Basic. Low-revenue ACOs will be able to stay in 1-sided risk for 3 years. Difference [between] 2 & 3 years is big. The decision to take risk is made summer before the year starts. So 2 years of 1-sided risk meant making the risk decision before year 1 results even came in.”

But in a statement from the National Association of ACOs (NAACOS), an association comprised of more than 360 ACOs, Clif Gaus, Sc.D., NAACOS’s president and CEO expressed concern that CMS retained the two-year limit for other ACOs. “Becoming a well-functioning ACO takes time and requires building of IT infrastructure, hiring care coordinators, changing the culture of providers, among other tasks. Under CMS’s proposed rule, many ACOs would have just a single year of performance data available to them before evaluating the required move to risk in their third year of the program,” Gaus stated.

Gaus did include a conciliatory note in his statement, saying that "We appreciate CMS' effort in the final rule to provide greater stability to the Medicare Shared Savings Program with five-year agreement periods and more flexibility through waivers for telehealth and skilled nursing facility stays. We look forward to working with CMS to ensure that the Medicare Shared Savings Program, which has a track record of saving taxpayer hundreds of millions of dollars while demonstrably improving care for patients, continues to attract new participants and reap savings." NAACOS has been among the most vocal of healthcare professional associations this year, as CMS Administrator Seema Verma has intensified her call for providers to move forward quickly into more advanced forms of alternative payment models.

But, choosing not to sound any notes of conciliation on Friday, was the Chicago-based American Hospital Association, the largest U.S. hospital association, representing nearly 5,000 hospitals nationwide. A statement attributed to Tom Nickels, AHA vice president, on Dec. 21, said, “Today’s final rule will not be helpful in the move toward value-based care. None of the actions taken today will better empower ACOs to maximize their contribution to patient care and are not pathways for improving the value of the program for patients. We remain opposed to CMS drastically shortening the length of time in which ACOs can participate in an upside-only model. Hospitals and health systems have asked for a more gradual pathway because building a successful ACO that is able to take on financial risk requires significant investments in time, effort and finances.”

Further, the AHA statement said, “While CMS made some improvements to its shared savings rate policies from the proposed rule, they still are not sufficient to appropriately reward ACOs for improving quality and reducing costs. We are particularly concerned about the impact of these and other policies on high-revenue ACOs. We do appreciate that CMS took certain steps to expand participants’ ability to provide care to beneficiaries – for example, via telehealth and longer agreement periods.”

And, the AHA said, “As a whole, the policies in the rule will likely result in a significant decrease in program participation. That would be unfortunate, as we seek to transform care to better serve our patients and communities.”

While the Centers for Medicare & Medicaid Services (CMS) finalized some improvements to the Medicare Shared Savings Program (MSSP), the Premier healthcare alliance is extremely concerned that these are overshadowed by unrealistic expectations of the speed at which providers can transition to risk-based tracks, the un-level playing field created for hospital-led vs. physician-led ACOs and the imbalance of risk vs. reward.

Meanwhile, leaders at the Charlotte-based Premier Inc. were equally critical. In a statement released on Friday, Blair Childs, Premier’s senior vice president of public affairs said that while “Premier appreciates that CMS finalized the extension of waivers and the longer agreement period and heard our concerns about the reduction in shared savings,” “We are extremely disappointed, however, that CMS has moved forward in creating an unlevel playing field that disadvantages high-revenue ACOs—primarily hospital-led ACOs. Premier and other stakeholders, including MedPAC, oppose this policy,” the statement read. “Hospital-led ACOs in Premier’s Population Health Management Collaborative performed twice as well as all the other ACOs nationally. CMS should be taking steps to enhance, not limit, the inclusion of all innovative providers that are seeking to move to value-based care. For an Administration that has been outspoken in advocating for market solutions and level playing fields among competitors, it’s an enormous mistake to finalize a policy that pits providers against each other rather than focusing on collaboration, as the model intends.”

So, where does this leave the industry? Quite possibly, at an important inflection point, now that what was a proposed rule is now a final rule. One could argue this situation from a number of standpoints, but the bottom line is simple: in her desire to push providers forward quickly and decisively into two-sided risk—and even with the carrot-like incentives for smaller physician groups that have been added—Administrator Verma is now strongly risking a massive wave of defections from the MSSP.

As NAACOS’ Gaus noted in his statement, “Under CMS's proposed rule, many ACOs would have just a single year of performance data available to them before evaluating the required move to risk in their third year of the program.” Perhaps similarly importantly, he noted, "Although we are pleased that CMS finalized a new, limited exception to its high-low policy, we remain concerned that the high-low revenue ACO distinction could deter providers who want to embark on the path of value-based care and could unintentionally harm physician-led ACOs. We urged CMS in the rulemaking process to provide an equal playing field for all ACOs and will continue to advocate for changes to this policy. A NAACOS analysis of how ACOs would be classified under CMS's proposed definitions found almost 20 percent of physician-led ACOs would be considered high revenue ACOs. Furthermore, federally qualified health centers and rural health clinics would also have a fair proportion of high revenue ACOs.”

So, here we come to a very tricky set of issues. First, the entire point of adding in the “low-income ACO” distinction was to encourage more physician groups to join the MSSP; and that would be very important for the survival and thriving of the program, since the participation of hospital-based organizations has been slow to date, and one key way to encourage participation by all types of patient care organizations would be to be able to boast about rapidly increasing participation. But if, as Gaus has noted, NAACOS’ analysis finds that nearly 20 percent of physician-led ACOs would actually end up being “high-revenue ACOs,” that could indeed complicate CMS’s attempts to quickly gain new participants.

Further, the short period of time between initial participation and having to decide whether to stay in the voluntary program and take on mandated two-sided risk, poses one of the most serious barriers to increased participation; and therein lies the real rub for CMS, because if this final rule ends up causing mass defections in the next two years, the agency’s signature and largest federal ACO program could begin to fall apart, precisely at the time that Administrator Verma, Health and Human Services Secretary Alex Azar, and all their fellow senior federal healthcare policy officials, would be hoping to accelerate the shift from volume to value in U.S. healthcare, and prove that the broad ACO experiment is working.

On the other hand, it’s also true that if CMS allows the forward evolution of the MSSP program to progress too slowly, that could cause members of Congress and their staffs to determine that voluntary programs simply aren’t cutting it, and move towards massive Medicare cuts instead, in an attempt to get better control of overall U.S. healthcare inflation, at a time when all discretionary spending in the federal budget is increasingly becoming politically fraught.

For the time being, there is no simple answer to any of this. It’s as though the levers of power and influence must be used in an exquisitely calibrated way. There seems to be no “Goldilocks pace” of change here that will both maximize new participation, and ongoing participation, in the MSSP program, on the part of wary providers, and yet also fulfill all the demands and desires of senior federal healthcare policy officials. Only time will tell, but this moment feels more fraught than ever, in the ongoing evolution of the ACO experiment. There’s no doubt that 2019 could be a determinative year for MSSP.



Related Insights For: Payment


CMS: 93% of Clinicians Get Positive Payment Adjustments for MIPS Year 1

November 8, 2018
by Rajiv Leventhal, Managing Editor
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Ninety-three percent of MIPS (Merit-based Incentive Payment System)-eligible clinicians received a positive payment adjustment for their performance in 2017, and 95 percent overall avoided a negative payment adjustment, according to a CMS (Centers for Medicare & Medicaid Services) announcement today.

The first year of MIPS under MACRA’s Quality Payment Program (QPP) was dubbed by CMS as a “pick your pace year,” which essentially enabled clinicians to avoid payment penalties as long as they submitted at least the minimum amount of quality data. As such, in its announcement, CMS did admit that the overall performance threshold for MIPS was established at a relatively low level of three points, and the availability of “pick your pace” provided participation flexibility through three reporting options for clinicians: “test”, partial year, or full-year reporting.

CMS said that 93 percent of MIPS-eligible clinicians received a positive payment adjustment for their performance in 2017, and 95 percent overall avoided a negative payment adjustment. CMS specifically calculated that approximately 1.06 million MIPS-eligible clinicians in total will receive a MIPS payment adjustment, either positive, neutral, or negative. The payment adjustments for the 2017 program year get reflected in 2019.

Breaking down the 93 percent of participants that received a positive payment adjustment last year, 71 percent earned a positive payment adjustment and an adjustment for exceptional performance, while 22 percent earned a positive payment adjustment only. Meanwhile, just 5 percent of MIPS-eligible clinicians received a negative payment adjustment, and 2 percent received a neutral adjustment (no increase or decrease).

Of the total population, just over one million MIPS-eligible clinicians reported data as either an individual, as a part of a group, or through an Alternative Payment Model (APM), and received a neutral payment adjustment or better. Additionally, under the Advanced APM track, just more than 99,000 eligible clinicians earned Qualifying APM Participant (QP) status, according to the CMS data.

CMS Administrator Seema Verma noted on the first pick-your-pace year of the QPP, “This measured approach allowed more clinicians to successfully participate, which led to many clinicians exceeding the performance threshold and a wider distribution of positive payment adjustments. We expect that the gradual increases in the performance thresholds in future program years will create an evolving distribution of payment adjustments for high performing clinicians who continue to invest in improving quality and outcomes for beneficiaries.”

For 2018, the second year of the QPP, CMS raised the stakes for those participating clinicians. And in the third year of the program, set to start in January 2019, a final rule was just published with year three requirements. Undoubtedly, as time passes, eligible clinicians will be asked for greater participation at higher levels. At the same time, CMS continues to exempt certain clinicians who don’t meet a low-volume Medicare threshold.

Earlier this year, CMS said that 91 percent of all MIPS-eligible clinicians participated in the first year of the QPP, exceeding the agency’s internal goal.

What’s more, from a scoring perspective in 2017, the overall national mean score for MIPS-eligible clinicians was 74.01 points, and the national median was 88.97 points, on a 0 to 100 scale. Further breaking down the mean and median:

  • Clinicians participating in MIPS as individuals or groups (and not through an APM) received a mean score of 65.71 points and a median score of 83.04 points
  • Clinicians participating in MIPS through an APM received a mean score of 87.64 points and a median score of 91.67 points

Additionally, clinicians in small and rural practices who were not in APMs and who chose to participate in MIPS also performed well, CMS noted. On average, MIPS eligible clinicians in rural practices earned a mean score of 63.08 points, while clinicians in small practices received a mean score of 43.46 points.

Said Verma, “While we understand that challenges remain for clinicians in small practices, these results suggest that these clinicians and those in rural practices can successfully participate in the program. With these mean scores, clinicians in small and rural practices would still receive a neutral or positive payment adjustment for the 2017, 2018, and 2019 performance years due to the relatively modest performance thresholds that we have established. We will also continue to directly support these clinicians now and in future years of the program.”

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