CMS Innovation and Health Care Delivery System Reform Stephen Cha, MD, Director for the State Innovations Group Center for Medicare and Medicaid Innovation Center for Medicare and Medicaid Services (CMS) April 27, 2016
During January 2015, HHS announced goals for value-based payments within the Medicare FFS system As of January 01, 2016 , the 30% goal was achieved one year ahead of schedule. 2
CMS has adopted a framework that categorizes payments to providers Category 1: Category 2: Category 3: Category 4: Fee for Service – Alternative Payment Models Built Fee for Service – No Link to Value Link to Quality on Fee-for-Service Architecture Population-Based Payment Payments are At least a portion Some payment is linked to the Payment is not directly based on of payments vary effective management of a triggered by service volume of based on the population or an episode of delivery so volume is not services and quality or care linked to payment Description Payments still triggered by Clinicians and not linked to efficiency of quality or health care delivery of services, but organizations are paid and efficiency delivery opportunities for shared responsible for the care of savings or 2-sided risk a beneficiary for a long period (e.g., ≥1 year) Limited in Hospital value- Accountable Care Organizations Eligible Pioneer Medical homes Medicare fee- based purchasing Accountable Care Physician Value Bundled payments for-service Organizations in years 3-5 Medicare Majority of Comprehensive Primary Care Maryland hospitals Modifier Fee-for- Readmissions / Medicare initiative Service Comprehensive ESRD payments now Hospital Acquired examples Medicare-Medicaid Financial are linked to Condition quality Reduction Alignment Initiative Fee-For- Program Service Model 3 Source: Rajkumar R, Conway PH, Tavenner M. CMS ─ engaging multiple payers in payment reform. JAMA 2014; 311: 1967 -8.
Target percentage of payments in ‘FFS linked to quality’ and ‘alternative payment models’ by 2016 and 2018 Alternative payment models (Categories 3- 4) FFS linked to quality (Categories 2- 4) All Medicare FFS (Categories 1 - 4) 2011 2014 2016 2018 0% ~20% 30% 50% ~70% >80% 85% 90% Historical Performance Goals 4
CMS will achieve Goal 1 through alternative payment models where providers are accountable for both cost and quality Major APM Categories 2014 2015 2016 2017 2018 Medicare Shared Savings Program ACO* Accountable Care Pioneer ACO* Organizations Comprehensive ESRD Care Model Next Generation ACO Bundled Payment for Care Improvement* Bundled Comprehensive Care for Joint Replacement Payments Oncology Care Comprehensive Primary Care* Advanced Multi-payer Advanced Primary Care Practice* Primary Care Maryland All-Payer Hospital Payments* Other Models ESRD Prospective Payment System* CMS will continue to test new models and will Model completion or expansion identify opportunities to expand existing models 5 * MSSP started in 2012, Pioneer started in 2012, BPCI started in 2013, CPC started in 2012, MAPCP started in 2011, Maryland A ll Payer started in 2014 ESRD PPS started in 2011
CMS will reach Goal 2 through more linkage of FFS payments to quality or value Hospitals, % of FFS payment at risk (maximum downside) Readmissions Reduction Program 7 7 6.55 HVBP (Hospital Value- 2 2 based Purchasing) 1.75 IQR/MU (Inpatient Quality 2 2 1.75 Reporting / Meaningful Use) 2 2 2 HAC (Hospital-Acquired Conditions) 1 1 1 Performance period Performance Performance 2014 (payment FY16) period 2015 (FY17) period 2016 (FY18) Physician, % of FFS payment at risk (maximum downside) 9* 9 Physician VM ( 4 6 4 (Value Modifier) 4 2 MU (Electronic Health 3 Record Meaningful Use) 3 3 2 PQRS (Physician Quality 4 2 2 2 2 Reporting System) 2014 Performance 2015 Performance 2016 Performance 2017 Performance period period period period (payment FY16) (payment FY17) (payment FY18) (payment FY19) 6 * P hysician VM adjustment depends upon group size and can range from 2% to 4%
MACRA: What is it? The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) is: Bipartisan legislation repealing the Sustainable Growth Rate (SGR) Formula • • Changes how Medicare rewards clinicians for value over volume • Created Merit-Based Incentive Payments System (MIPS) that streamlines three previously separate payment programs: Physician Quality Value-Based Payment Medicare EHR Reporting Program Modifier Incentive Program (PQRS) • Provides bonus payments for participation in eligible alternative payment models (APMs) 7
Recall: How MACRA gets us closer to meeting HHS payment reform goals The Merit-based Incentive Payment System helps to link fee-for-service payments to New HHS Goals: quality and value. 2016 2018 30% 50% The law also provides incentives for participation in Alternative 90% 85% Payment Models via the bonus payment for Qualifying APM Participants (QPs) and favorable scoring in MIPS for APM All Medicare fee-for- service (FFS) payments (Categories 1 - 4) participants who are not QPs. Medicare FFS payments linked to quality and value (Categories 2- 4) Medicare payments linked to quality and value via APMs (Categories 3- 4) Medicare payments to QPs in eligible APMs under MACRA 8
CMS is aligning with private sector and states to drive delivery system reform CMS Strategies for Aligning with Private Sector and states Convening Stakeholders Incentivizing Partnering Providers with States 9
The CMS Innovation Center was created by the Affordable Care Act to develop, test, and implement new payment and delivery models Section 3021 of “The purpose of the [Center] is to test Affordable Care Act innovative payment and service delivery models to reduce program expenditures…while preserving or enhancing the quality of care furnished to individuals under such titles” Three scenarios for success 1. Quality improves; cost neutral 2. Quality neutral; cost reduced 3. Quality improves; cost reduced (best case) If a model meets one of these three criteria and other statutory prerequisites, the statute allows the Secretary to expand the duration and scope of a model through rulemaking 10
The Innovation Center portfolio aligns with delivery system reform focus areas Focus Areas CMS Innovation Center Portfolio* Test and expand alternative payment models Accountable Care Bundled payment models ‒ Pioneer ACO Model ‒ Bundled Payment for Care Improvement Models 1 - 4 ‒ Medicare Shared Savings Program (housed in Center for ‒ Oncology Care Model Medicare) ‒ Comprehensive Care for Joint Replacement ‒ Advance Payment ACO Model Initiatives Focused on the Medicaid ‒ Comprehensive ERSD Care Initiative ‒ Medicaid Incentives for Prevention of Chronic Diseases ‒ Next Generation ACO Pay ‒ Strong Start Initiative Primary Care Transformation ‒ Medicaid Innovation Accelerator Program Providers ‒ Comprehensive Primary Care Initiative (CPC) Dual Eligible (Medicare-Medicaid Enrollees) ‒ Multi-Payer Advanced Primary Care Practice (MAPCP) ‒ Financial Alignment Initiative Demonstration ‒ Initiative to Reduce Avoidable Hospitalizations among ‒ Independence at Home Demonstration Nursing Facility Residents ‒ Graduate Nurse Education Demonstration ‒ Home Health Value Based Purchasing Medicare Advantage (Part C) and Part D ‒ Medicare Care Choices ‒ Medicare Advantage Value-Based Insurance Design model ‒ Part D Enhanced Medication Therapy Management Support providers and states to improve the delivery of care Learning and Diffusion State Innovation Models Initiative ‒ Partnership for Patients ‒ SIM Round 1 ‒ Transforming Clinical Practice Deliver Care ‒ SIM Round 2 ‒ Community-Based Care Transitions ‒ Maryland All-Payer Model Health Care Innovation Awards Million Hearts Cardiovascular Risk Reduction Model Accountable Health Communities Increase information available for effective informed decision-making by consumers and providers Distribute Health Care Payment Learning and Action Network Shared decision-making required by many models Information Information to providers in CMMI models 11 * Many CMMI programs test innovations across multiple focus areas
CMS has engaged the health care delivery system and invested in innovation across the country Models run at the state level Sites where innovation models are being tested Source: CMS Innovation Center website, December 2015 12
Comprehensive Primary Care (CPC) is showing early but positive results CMS convenes Medicaid and commercial payers to support primary care practice transformation through enhanced, non-visit-based payments, data feedback, and learning systems $14 or 2%* reduction part A and B expenditure in year 1 among all 7 CPC regions Reductions appear to be driven by initiative-wide impacts on hospitalizations, ED visits, and unplanned 30 -day readmissions 7 regions (AR, OR, NJ, CO, OK, OH/KY, NY) encompassing 31 payers , nearly 500 practices, and approximately 2.5 million multi-payer patients Duration of model test: Oct 2012 – Dec 2016 * Reductions relative to a matched comparison group and do not include the care management fees (~$20 pbpm) 13
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