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Premier’s Blair Childs: Perspectives on Medicare Risk for Accountable Care (Part 1)

June 9, 2015
by Mark Hagland
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Premier Inc.’s Blair Childs looks at this juncture in the forward evolution of accountable care—and what healthcare leaders need to do next

Following the announcement of a revised rule on accountable care organizations (ACOs) in the Medicare Shared Savings Program (MSSP), published last week by the Centers for Medicare & Medicaid Services (CMS), the Premier Inc. released a statement from Blair Childs, senior vice president, public policy for the Charlotte-based health alliance. That statement expressed mixed reactions to different elements of the new rule for the MSSP.

In his statement, Childs began by saying that "Members of the Premier healthcare alliance applaud the Centers for Medicare & Medicaid Services (CMS) for adopting vital changes to the regulations governing the implementation of the Medicare Shared Savings Program (MSSP). With this rule, we are taking a significant step forward in the ongoing journey to provide more coordinated, cost-effective healthcare to millions of Medicare beneficiaries."

As expressed in that statement, Childs praised,, among other things, CMS's "decision to allow providers to remain in the one-sided risk option in Track 1 without a reduction in the shared savings percentage, and to allow choices in minimum savings rates for Tracks 2 and 3 that will help level the playing field for smaller accountable care organizations (ACOs)." He also praised CMS officials' moving towards a more "streamlined data sharing process," which he said "will reduce beneficiary confusion and provider burden, while at the same time providing more timely and actionable data. Taken together," he said, "these changes will help to remove many of the key hurdles that were inhibiting provider success."

But he also said in that same statement that it was "extremely concerning that CMS was not willing to extend certain payment waivers to ACOs, despite a plurality of commenters recommending this course of action."

This week, Childs spoke with HCI Editor-in-Chief Mark Hagland, regarding not only the June 4 CMS announcement, but more broadly, regarding the current trajectory of accountable care, value-driven reimbursement, and overall policy and payment changes taking place right now in U.S. healthcare.

Below are excerpts from part 1 of that interview; part 2 will be published next week.

Were you at all surprised by the parameters of the new ACO rule contained in the CMS announcement last week?

We weren’t surprised that they wanted more comments on benchmarks, and so forth. I was a little bit surprised that they didn’t show more flexibility around the waivers; that was disappointing. There were a number of things that were definitely positives. Actually, you’re always a bit surprised every time a rule comes out. Was I happy? I would say we’re lukewarm about it, as you could tell from the statement.

There are some interesting IT provisions in the rule. I haven’t read it in detail, but on page 127 in the final rule, there’s a discussion saying you need to detail in the application how you’re going to partner with and use HIT or electronic interfaces, with long-term and post-acute care providers. They also ask for you to talk about how you’re going to use enabling technology.

We had asked about HIT activities that might be required in the application, such as notifying a primary care doc that a patient was admitted, or something like that. There are no specific requirements, and that’s good. But it does start to move towards higher standards in requiring the use of HIT and the EHR. That’s consistent with the SGR fix—the MACRA [Medicare Access and CHIP Reauthorization Act of 2015] legislation ushering in the new payment system. To qualify for an alternative payment model under that new system, you’ve got to have an EHR [electronic health record], and have got to be using that EHR. So I would describe this as the “lite” version of that, but clearly, they’re moving towards putting more IT requirements into the ACO regs.

And I can understand the meaningful use element; but that’s a separate program, and providers are going to need to be using health IT anyway, so why they would need to make additional requirements around it doesn’t make a lot of sense to me.

Blair Childs

Does this feel a bit like an inflection point in terms of the ACO programs? A tipping point in terms of providers either moving full-bore into risk-based contracting, or sliding backwards a bit?

I think there’s no question that there is risk here and concern here around the federal ACO programs, and there does seem to be a view at CMS that providers want to take on more risk. And I do think that providers are moving in that direction, no question. But this is difficult, difficult work, and it requires new infrastructure, and is literally changing 50 years of culture in healthcare. And when I speak with members out in the field, it’s clear we’re still living in the old world for the most part.

And under MACRA, the SGR reform law, providers can either go into MIPS, the value-based purchasing program just like the hospital program, for physicians, or they can go to an alternative payment model. If they go to MIPS, they have an increasing level of risk that starts at 4 percent and scales to 9 percent. You can stay in FFS, under MIPS, but you’ll be at increasing levels of risk. When the administration talked about getting t0 80 percent risk under FFS by 2016 and 90 percent and 2018, and 30 and 50 percent in alternative payment models in those years, that’s what this is about.

So that’s what their goal is. Have they gone has far as they should have in this rule to make it more attractive? No, they have not. They could have allowed for more waivers for home health and telehealth, to allow providers to reengineer care for a more efficient system. I also think they should give more fair savings overall.

CMS—they’re frankly getting 50 cents on the dollar that providers are achieving by reengineer8ing care, and they’re not really having to do anything. So I think their goal should be to make this more attractive so that providers want to move in that direction; and they didn’t go as far as they could have, in my opinion. It could have been worse, certainly. But it still could have gone further the other way.

What’s the tenor of your conversations with provider members these days?

It’s interesting. We’ve gone from sort of [seeing accountable care as a] fad, to trend, to reality, in terms of the mentality that’s out there. I’m at the Catholic Health Assembly meeting right now, and some of the CEOs were on a panel yesterday, speaking, and they were all commenting on the new leadership requirements in population health, and the role of hospitals in the future. And it was just a very different conversation than I would have heard just two years ago. So I think there’s an awareness and a movement, and you can see all this happening. But I still think CMS has to do more to make this truly attractive.

We keep hearing provides say that they feel they have feet in both camps, modified fee-for-service and risk-based payment. Would you agree that it’s hard for providers right now to be operating in both worlds?

Yes, unquestionably it is, I’d have to say. There are so many dysfunctional parts of the system, much of which comes from government policy, including all the rules that really restrict your ability to operate in a more efficient way. And I think CMS needs to better understand the challenges and investments and the cultural impediments to change. And I think they need to change the way they think about it. They’re subject to those same impediments.

I think CMS needs to better understand the challenges and investments and the cultural impediments to change. And I think they need to change the way they think about it. They’re subject to those same impediments.

In part 2 of this interview, Childs will discuss strategic, leadership, and process change issues affecting provider organizations right now.


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