Life Science Compliance Update

November 16, 2017

CMS RFI Issued Regarding CMMI and Payment Models


In September, CMS issued a "request for information" (RFI) to solicit new ideas that will revamp CMS' Center for Medicare and Medicaid Innovation (CMMI) and the payment models the center creates. Specifically, CMS “is seeking your feedback on a new direction to promote patient-centered care and test market-driven reforms that empower beneficiaries as consumers, provide price transparency, increase choices and competition to drive quality, reduce costs, and improve outcomes.”

New Model Design

According to the RFI, CMMI will approach new model design with several guiding principles:

  1. Choice and competition in the market – Promote competition based on quality, outcomes, and costs.
  1. Provider Choice and Incentives – Focus on voluntary models, with defined and reasonable control groups or comparison populations, to the extent possible, and reduce burdensome requirements and unnecessary regulations to allow physicians and other providers to focus on providing high-quality healthcare to their patients. Give beneficiaries and healthcare providers the tools and information they need to make decisions that work best for them.
  1. Patient-centered care – Empower beneficiaries, their families, and caregivers to take ownership of their health and ensure that they have the flexibility and information to make choices as they seek care across the care continuum.
  1. Benefit design and price transparency – Use data-driven insights to ensure cost-effective care that also leads to improvements in beneficiary outcomes.
  1. Transparent model design and evaluation – Draw on partnerships and collaborations with public stakeholders and harness ideas from a broad range of organizations and individuals across the country.
  1. Small Scale Testing – Test smaller scale models that may be scaled if they meet the requirements for expansion under 1115 A(c) of the Affordable Care Act (the Act). Focus on key payment interventions rather than on specific devices or equipment.

CMMI states that it is looking to test models in eight focus areas: (1) Increased participation in Advanced Alternative Payment Models (APMs); (2) Consumer-Directed Care & Market-Based Innovation Models; (3) Physician Specialty Models; (4) Prescription Drug Models; (5) Medicare Advantage (MA) Innovation Models; (6) State-Based and Local Innovation, including Medicaid-focused Models; (7) Mental and Behavioral Health Models; and (8) Program Integrity. However, the Innovation Center may also test models in other areas.

New Direction

In August, after delaying several mandatory bundled payment models, CMS ultimately proposed to scale back the Comprehensive Care for Joint Replacement (“CJR”) Model, a bundled payment program for hip and knee replacement implemented by the Obama Administration, and eliminate the Episode Payment Models and Cardiac Rehabilitation Incentive Payment Model scheduled to begin on January 1, 2018.

In a Wall Street Journal op-ed announcing the RFI, Administrator Verma noted the following: “Clinicians, patients, entrepreneurs, state officials and others are busy designing new and better ways to provide health care. There are a lot of great ideas, and we want to hear from people on the front lines. No government agency has all of the answers, especially in an industry as large and multifaceted as health care.”

As has been previously noted, accountable care organizations, hospitals, and primary care providers were not mentioned at all in the RFI. This is a major shift in focus from an agency that once championed these care settings. This lack of inclusion gives one reason to believe that bundled payments will not only continue, but will be underscored as viable paths for physicians’ success under the MACRA alternative payment model track. In addition to a shift in focus of providers, discussion in the RFI of the Physician-Focused Payment Model Technical Advisory Committee (PTAC) initiative, centered on developing physician-driven APMs, indicate that CMMI will much more focused on specialty care and specialty physicians.

November 13, 2017

Accountable Care Organization Performance Results


2016 was the fifth performance year for the Medicare Shared Savings Program (MSSP). 2016 brought $652 million in savings to Medicare via Accountable Care Organizations, according to the Health Care Transformation Task Force.

The Shared Savings Program offers providers and suppliers (e.g., physicians, hospitals, and others involved in patient care) an opportunity to create a new type of health care entity, an Accountable Care Organization (ACO). An ACO agrees to be held accountable for the quality, cost, and experience of care of an assigned Medicare fee-for-service (FFS) beneficiary population. The Shared Savings Program has different tracks that allow ACOs to select an arrangement that makes the most sense for their organization.

Roughly one-third of MSSP ACOs generated savings in 2016, according to CMS data. In terms of quality, 330 of the 428 ACOs subject to pay-for-performance measures earned an average quality score of 94 percent. Ninety-eight of the ACOs garnered a 100 percent quality score. Overall, the average performance score improved by more than 10 percent across five measures: screening for fall risk, depression screening and follow-up, high blood pressure screening and follow-up, hemoglobin checks for diabetic patients, and diabetes eye exams.

ACOs that have been in MSSP since 2012 and 2013 accounted for $503 million in gross savings. The newer the participants, the less money they saved: ACOs that entered in 2014 saved $94 million, 2015 entrants saved $50 million and the 100 ACOs that entered MSSP in 2016 saved only $6 million.

The 2012 and 2013 ACOs received $351 million in shared savings payments, leaving the remaining $151 million as savings for CMS. That’s in contrast to 2015, when CMS spent $217 million more in awarding bonuses to ACOs in both the MSSP and Pioneer ACO programs than what participants were projected to have saved.

“These results demonstrate the promise of new models of care delivery and financing for improving patient outcomes and reducing spending,” stated David Lansky, Health Care Transformation Task Force Chair. “This provides further evidence that we need more, not less, public and private sector investigation of alternatives to traditional fee-for-service medicine.”

MSSP ACOs in the program for at least three years also decreased costs by an average of $10.1 million per organization in 2015. In comparison, MSSP ACOs just starting the program only cut costs by an average of $5.4 million per organization.

The top ten ACOs with the highest shared savings in 2016 were:

  1. Palm Beach ACO (Palm Springs, Fla.): $30,540,508
    2. Advocate Physician Partners Accountable Care (Rolling Meadows, Ill.): $28,924,272
    3. Hackensack (N.J.) Alliance ACO: $22,835,022
    4. USMM Accountable Care Partners (Troy, Mich.): $21,195,787
    5. AMITA Health ACO (Arlington Heights, Ill.): $20,489,157
    6. Cleveland Clinic Medicare ACO: $19,914,592
    7. Millennium ACO (Fort Myers, Fla.): $18,530,680
    8. UT Southwestern Accountable Care Network (Dallas): $17,464,034
    9. Memorial Hermann ACO (Houston): $14,025,212
    10. Orange Accountable Care of South Florida (Miami Lakes, Fla.): $13,033,788

November 07, 2017

MedPAC Discusses Part D Exceptions and Appeals Process


On October 6, 2017, the Medicare Payment Advisory Commission (MedPAC) met for its October meeting, where it discussed recent information about Medicare Part D exceptions and appeals. Also discussed were the potential benefits and obstacles to the adoption of electronic tools, such as real-time prescription benefit checks and electronic prior authorization that have the potential to reduce the need for the exceptions and appeals process.

MedPAC commissioners were supportive overall for the adoption of electronic tools to streamline efforts, but stopped short of making specific recommendations due to lack of reliable data.

MedPAC Senior Analyst Jennifer Poldulka outlined the exceptions and appeals process for Medicare Part D beneficiaries, noting that enrollees may request a formulary or tier exception for purchase of a specific drug. She said that plans are required to report data on transactions that are rejected at the point of sale and outcomes of the determination and redetermination appeal steps. Ms. Poldulka said that few pharmacy transactions are appealed to plans for coverage determinations or redetermination and that the plan decisions typically favor the enrollee, based on 2015 data.

It was noted that the most common Part D pharmacy transaction rejections happen when a drug is classified as a non-formulary drug. Ms. Poldulka found that only five percent of redeterminations were appealed to the Independent Review Entity (IRE), and that the IRE usually upholds plans’ redetermination decisions. However, Ms. Poldulka cautioned that not all Part D plan data must be reported, and that some data that is reported does not pass CMS data validation standards. She also mentioned that MedPAC found variations in reported pharmacy transaction rejections and determinations, redeterminations, and IRE outcomes.

MedPAC Research Assistant Emma Achola highlighted four electronic prescribing tools that can be used to help streamline the exceptions and appeals process:

(1) electronic prescribing (eRx);

(2) formulary look-up;

(3) real-time prescription benefit (RTPB) check and;

(4) electronic prior authorization (ePA).

Ms. Achola focused on ePA, noting that it is the most complete option, though there are “significant” obstacles with full adoption of ePA. She said that in order for ePA to operate efficiently, multiple actors within the healthcare system must effectively coordinate. She pointed out that the large number of electronic health record (EHR) and ePA vendors make data integration difficult. Additionally, she cautioned that clinicians may bear additional costs and must embrace practice pattern changes in order for an ePA model to succeed.

Commissioner Discussion

Commissioner Jack Hoadley of Georgetown University highlighted the need for a “good, effective” solution to the appeals process and that data limitations make it difficult to make sense of what the numbers actually mean. He was supportive of ePA, noting that he is encouraged by the technology and believes that it can be a “good route” to improving the exceptions and appeals process.

Commissioner Amy Bricker of Express Scripts called for a requirement centered around eRx. She noted that eRx gives the clinician more control and provides an effective solution for all parties involved. Ms. Bricker said that she is a big proponent of ePA, noting that it’s a “great” way to solve issues such as delays and physician workload, but that there would need to be an adequate incentive model for physicians to participate.

Commissioner Pat Wang of Healthfirst complimented the array of electronic tools that are available. She noted that the key issue is integration of planned formulary rules into EHRs so that the data is found on one platform, saying that the only way to get full adoption of ePA is to make it as easy as possible for the prescriber. She encouraged more discussion about the technology that currently exists within EHR vendors, and how it can be properly integrated into ePA.

Commissioner Dana Gelb Safran of Blue Cross Blue Shield of Massachusetts and Commissioner Kathy Buto both spoke to their support of ePA. Commissioner Craig Samitt of Anthem said that prior authorization is an area of “angst,” noting that it is a costly process for also supports ePA, but cautioned that finding a method to both mandate and incentivize these techniques raises issues. Mr. Samitt encouraged a broader conversation as to the best ways to advocate for eRx and ePA, questioning if there is an existing business model that captures this successfully.

Commissioner Rita Redberg of UCSF called the process for eRx “strenuous” and “not user friendly. She noted that it is likely that doctors would retire before they adjust their practices to account for technological disruption. Dr. Redberg also said that there are much bigger issues within prior authorization that are of concern to physicians and beneficiaries.


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