c. 2015 Alice G. Gosfield and Associates PC

Getting To Value: Will It Really Be So Different?

Alice G. Gosfield, Esq.Palm Beach County Medical SocietySeptember 18, 2015

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Alice G. Gosfield, J.D.Alice G. Gosfield and Associates, PC

2309 Delancey PlacePhiladelphia, PA 19103

(215) 735-2384Agosfield@gosfield.com

www.gosfield.com www.uft-a.com

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Overview

The pressures for value How new payment models fit How payor arrangements may change Clinical integration: the sine qua non The new fraud and abuse

environment Strategies for success

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Health Reform’s New Language Efficient/efficiency: 89 Value/value-based: 115 Effective/effectiveness: 146 Quality: 483

References to “quality” include the following phrases, repeatedly and throughout: high quality, quality improvement, quality reporting, quality measures, quality data, quality of care, quality performance.

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Medicare Bundled Payment for Care Improvement Initiative Mandate in the ACA: §3023 adding §1866D to the

Social Security Act What is to be bundled?

Physicians, hospital inpatient and outpatient services Post-acute care including home health, skilled

nursing, rehabilitation and long term care Mix of chronic and acute, surgical and medical, high

volume, subject to significant variation and opportunity to improve quality while reducing total expenditures

Defined episodes to include 3 days prior to admission,length of stay, 30 days post discharge

Evaluation by a third party

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Methodological Problems Anchoring on MS-DRGs: Establishes the base period

budget DRGs are about hospital resources They have nothing to do with quality They include widely disparate medical conditions

within the same DRG For chronic care much more is spent outside the

hospital than on the DRG After applications were submitted CMMI decided to

standardize the episodes Small numbers of patients No automatic Stark or AKS waivers but they could be

requested

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Medicare ACOs Providers paid in the ordinary course ACO entity has to be able to accept Part A

and Part B and allocate it Quality threshhold to qualify for shared

savings Savings measured against a benchmark Payment after three years No rules on allocation among providers Waivers for Stark and AKS

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Commercial -- ProvenCare Geisinger owns the hospitals, the

physicians and a health plan which pays for 30% of the hospital admissions

No charge for services on readmissions within 90 days: a ‘warranty’

Began with CABG Now includes elective angioplasty, perinatal

care, bariatric surgery and lung cancer Technically it’s not bundled payment but

bundled shared risk

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Commercial – Bailit and Burns 19 non-federal bundled programs nationally as of

May 2012, and again in 2013 9 focused on inpatient procedures – mostly hips and

knees Booz and Co surveyed employers in Oct 2012

and found interest in chronic care bundles –e.g., diabetes

Volume of bundles small, 10-50 a year for each provider

Not much savings reported The first report included PROMETHEUS Payment

implementations but the data was outdated

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c.2014, Alice G. Gosfield

Provider Payment Reform for Outcomes, Margins, Evidence, Transparency Hassle-reduction, Excellence, Understandability and Sustainability

www.hci3.org

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Typical v. PAC

Medical$595

Million

•Pharmacy•$732 Million

•Pharmacy•$407 Million

Medical $108 Million

Medical$488 Million

Medical$488 Million

Pharmacy$325 MillionPharmacy$325 Million

DiabetesRelevant Services

$1.32 billion

• Claims that do not have a “PAC” code

• All diabetes-related inpatient stays

• All professional services during stays

• All claims with “PAC” diagnosis codes

• All claims with “PAC” procedure codes

• Drugs used to treat PACs

Potentially Avoidable

Complications:$813 million

Typical claims and services:

$515 million

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HACs vs. PACs (Hip Replacement)

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Your payor arrangements will change

You may have far fewer direct payor relationships

Your money may come from a provider configuration

You won’t win with super secret decoder ring rates

You may be excluded from networks Your revenues may go down

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You will win by producing value: Lowered costs Better results Better patient satisfaction

You will be measured But you will not win without clinical

integration

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Clinical Integration What it is Why it matters You will not succeed without it Regardless of the architecture in

which you live Single specialty group Hospital employment Multispecialty group Academic medical center

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True Clinical Integration: A Definition

“Physicians working together systematically, with or without

other organizations and professionals, to improve their collective ability to deliver high quality, safe, and valued care

to their patients and communities.”

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The Goal of Clinical Integration

To facilitate better coordination and interaction among all the parties involved with the patient

To develop data to change behavior to produce better outcomes, better patient experience of care, more safety, more efficiently

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http://www.gosfield.com/PDF/ACI-fnl-11-29.pdf

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http://www.uft-a.com/CISAT.pdf

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FINANCE: Compensation: Salary, Productivity, Value

Not Really in the Game

Making an Effort Committed and Capable

We are either a multi-specialty group practice, or we are hospital-employed physicians

Pure FFS productivity. No relationship to practice costs or quality, special deals for some physicians. Each is his own cost center. All arrangements are secret.

FFS productivity, with <5% bonus for quality scores (e.g. a small stipend for a year) and other individual performance. The metrics for the bonus are known.

Market-based salary, with more than 10% bonus for living the values of the group, and achievement of group goals. Everyone knows what everyone gets paid.

We are the hospital medical staff, trying to be more clinically integrated with each other, and with the hospital, e.g. becoming an ACO

Physician comp is each practice’s business; there is no connection to our larger joint organizational work.

We have had conversations at the “steering committee’ for the hospital/physician organization about aligning compensation methods across all the independent practices, but there is a lot of tension about this.

Even though we are all independent practices and entities, we have reached agreement in principle that we will align compensation methods across all practices with the external payment model for our hospital/physician organization.

© 2011 Alice G. Gosfield, JD and James L. Reinertsen, MD20

What will your value be?

“The point is that some can become a high valued member of the overall care continuum, but they have to completely shift their mindset from procedure feeders to appropriateness police.”

---Francois de Brantes, Executive Director, HCI3

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In moving to value don’t fall into traps

Stark First settlement on internal compensation in a

group Profits Productivity and ‘incident to’

Reverse false claims We’ll treat Medicare one way and commercial

payment differently Claims which violate antikickback and Stark

if not repaid within 60 days of identifying them convert to false claims

Developing areas of liability Quality fraud

Egregiously poor quality Failure to supply enough staff, personnel Turning a blind eye to the poor quality of

lucrative business

Quality reporting fraud PQRS, hospital reporting of core measures E-prescribing Meaningful use of EHRs Failure to report adverse events

More Fraud and Abuse Change in intent for anti-kickback statute:

this is a big deal No specific intent required No knowledge of law required

Failure to repay an overpayment in 60 days is a false claim (more than FERA)

False statements or omissions made to get business with McAdv, Part D and Medicaid are false claims Permissive exclusions, $50,000 CMP 3x charges

More Work for Mother Enhanced screening of providers

Secretary can declare a temporary moratorium of categories of providers

Criminal background checks, fingerprinting, unannounced visits

Secretary can require compliance programs HHS can revoke enrollment for more than a year for a

physician who fails to maintain and provide access to documentation relating to orders or requests for DME, HHA Physician has to have had a face-to-face enounter in

prevous six months with the patient. Secretary can expand to others

DME and HHA may only be ordered by Medicare enrolled physician

Strategies for Success Measure yourselves Standardize as much as you possibly can, e.g.,

Documentation Clinical processes Use of non-physicians From whom you take and to whom you

make referrals Ruthlessly weed out anything which does not

contribute to science or patient experience Connect your compensation to the external

values Margins, margins, margins

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And More Have a functional compliance

program The best compliance program

supports the move to value Extend it beyond billing to include

quality and value Don’t forget HIPAA and security Do a security risk assessment of your

practice

Doing The Work

Diligence

Doing it right

Ingenuity Atul Gawande, “Better”

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Resources

There are many free publications on all of these issues at

www.gosfield.com/read/publications