Mastering the Mandatory Elements Of the Affordable Care Act February 26, 2014.

Mastering the Mandatory ElementsOf the Affordable Care Act

February 26, 2014

0.75%

1% 2%

0.1% 0.1%

1.0% 0.7%

TOTAL IMPACT% = % OF MEDICARE INPATIENT OPERATING PAYMENTS

Value-Based Purchasing

30-day readmissions

Hospital-acquired conditions

Market basket reductions

Multifactor Productivity Adj*

Documentation and Coding Adj (DCA)**

Across the board cuts to finance debt ***

OCT2014

OCT2011

OCT2018

OCT2019

OCT2020

OCT2017

OCT2013

OCT2016

OCT2015

OCT2012

1.0% 1.25% 1.5% 1.75% 2.0%

3.0%

1.0%

0.3%

0.5% 0.5% 0.5%

1.9%4.9%

2.0%

6.7% 10.6% 10%6.0%

*The Multifactor Productivity Adjustment is an estimate generated by the CMS Office of the Actuary **DCA, also known as the behavioral offset, shown here does not show the future affects of these cuts on baseline spending. Estimates FY 2014-FY 2017 impact of the American Taxpayer Relief Act of 2012*** If Congress has not adopted the Joint Committee’s report to reduce the deficit by at least $1.2 trillion, the 2% cut will be implemented April 2013

0.2%

8.1% 11.4% 9.4%10.5% 9.3% 8.7%8.9%

1.0% 2.0%

Current Reform Landscape

0.4%

2.1% 2.1% 2.1%2.1%

0.65% 0.9% 0.7%

Building Blocks For Other Models

Timeline of Performance

The Medicare DRG FormulaStandard Federal Rate

5

Labor PortionX Wage Index

Non Labor Portion

Adjusted Base Rate

Case Mix/DRG Weight

Generic Base Rate

DSH Adjustment + IME Adjustment

Payment

VALUE BASED PURCHASINGPayment Reform

VBP Shifting of Domain Weights

• Outcomes

• Patient Experience

• Efficiency (MSPB)

• Core Measures

New NQS Based Domains in FY 17

Note: The Clinical Care Component is split 25% Outcomes and 10% Process

Per August 13, 2013 Federal Register

What Determines Reimbursement?

• Reimbursement Determined Two Ways– Improvement– Achievement

• Improvement– How we measure against ourselves

• Did we do better than our baseline during our performance period

• Achievement– How we compare to Top Decile

• Must Meet or Exceede the Mean Scores of Top Decile Performers

9

Scenario on Scoring

AMI 7a- Fibrinolytic Therapy

.6548Achievement Threshold

.9191Benchmark

Baseline

Performance

Score.4287

Score.8163

Achievement Range (1-10)

Improvement Range (0-9)

Sourced: 2010 August Federal Register

FY 16 Clinical Process of Care 10%

Measure ID DescriptionAchievement

Threshold Benchmark

AMI-7a Fibrinolytic Therapy received within 30 min of hospital arrival

.91154 1.0000

IMM-2 Influenza Immunization .90607 .98875

PN-6 Initial antibiotic selection for CAP in Immunicompetent pt

.96552 1.0000

SCIP-Inf-2 Prophylatic Antibiotic Selection for Surgical Pts .99074 1.0000

SCIP-Inf-3 Prophylatic Antibiotics discontinued 24 hrs after surgery end time

.98086 1.0000

SCIP- Inf-9 Urinary catheter removed on post op day 1 or 2 .97059 1.0000

SCIP- Card-2

Surgery patients on beta blocker therapy prior to arrival who received a beta blocker during perioperative period

.97727 1.0000

SCIP-VTE-2 Surgery patients who received appropriate VTE prophylaxes within 24 hours prior to surgery to 24 hours after surgery

.98225 1.0000


FY 16 Outcome Measures 40%

Measure ID DescriptionAchievement

Threshold Benchmark

CAUTI Catheter Associated Urinary Tract Infection

.801 .000

CLABSI Central Line Associated Blood Stream Infection

.465 .000

SSI Surgical Site Infection Colon Abdominal Hysterectomy

.668

.752.000.000

Mort-30-AMI AMI 30 day Mortality rate .847472 .862371

Mort- 30-HF HF 30 day Mortality rate .881510 .900315

Mort- 30-PN PN 30 day Mortality rate .882651 .904181

PSI-90 Complication/patient safety for selected indicators (composite)

.622879 .451792


FY 16 Patient Experience of Care 25%

Description FloorAchievement

Threshold Benchmark

Communication with Nurses 53.99 77.67 86.07

Communications with Doctors 57.01 80.40 88.56

Responsiveness of Hospital Staff 38.21 64.71 79.76

Pain Management 48.96 70.18 78.16

Communication about Medicines 34.61 62.33 72.77

Hospital Cleanliness & Quietness 43.08 64.95 79.10

Discharge Information 61.36 84.70 90.39

Overall Rating of Hospital 34.95 69.32 83.97


30 Day Risk-Standardized Mortality Rate Calculation

14

Facility Predicted Deaths

Facility Expected DeathsX

Measure (AMI, HF, PN) National Crude Rate

=

This is 30 days post admission: the majority of these may be post discharge.

HF Mortality Formula

Numerator & Denominator Description The measure cohort consists of admissions for Medicare Fee-for-Service (FFS) and Veterans Health Administration (VA) beneficiaries aged 65 years and older discharged from non-federal acute care hospitals or VA hospitals, respectively, having a principal discharge diagnosis of heart failure (HF). The hospital-specific risk-standardized mortality rate (RSMR) is calculated as the ratio of the number of "predicted" deaths to the number of "expected" deaths, multiplied by the national unadjusted mortality rate. The "denominator" is the number of deaths expected on the basis of the nation's performance with that hospital's case mix.The "numerator" of the ratio component is the number of deaths within 30 days predicted on the basis of the hospital's performance with its observed case mix.

It conceptually allows for a comparison of a particular hospital's performance given its case mix to an average hospital's performance with the same case mix. Thus, a lower ratio indicates lower-than-expected mortality or better quality, and a higher ratio indicates higher-than-expected mortality or worse quality. Source: http://www.qualitymeasures.ahrq.gov/content.aspx?id=35573

Heart Failure Risk Adjustments

Demographics •Age-65 (years above 65, continuous) •Male

Cardiovascular •History of percutaneous transluminal coronary angioplasty (PTCA) •History of coronary artery bypass grafting (CABG) •Congestive heart failure •Acute myocardial infarction (AMI) •Other acute/subacute forms of ischemic heart disease •Chronic atherosclerosis •Cardio-respiratory failure and shock •Valvular and rheumatic heart disease

Comorbidity •Hypertension •Stroke •Renal failure •Chronic obstructive pulmonary disease (COPD) •Pneumonia •Diabetes and diabetes mellitus (DM) complications •Protein-calorie malnutrition •Dementia and senility •Hemiplegia, paraplegia, paralysis, functional disability •Peripheral vascular disease •Metastatic cancer, acute leukemia, and other severe cancers •Trauma in the last year •Major psychiatric disorders •Chronic liver disease

The final set of risk-adjustment variables included:

Source: http://www.qualitymeasures.ahrq.gov/content.aspx?id=35573

Efficiency Definition

• Medicare Spending Per Beneficiary (MSPB)– Captures total Medicare spending per beneficiary, relative to a

hospital stay, bundling hospital sources (Part A) with post acute care (Part B).

– Bundles the cost of care delivered to a beneficiary for an episode of care across the continuum of care.

• 3 days prior to admission and 30 days post discharge

• Indexed by the discharging hospital regardless of who provides services in the 3 days prior and 30 days post

– The first performance period ended 12/31/13 for FFY 15 and the second one started 1/1/14 for FFY 16.

18

Medicare Spending Per Beneficiary

Lists percent of spending for the hospital vs. state

and national statistics by

provider type.

By MDC for each Hospital1

9

Lists all 25 MDCs with state and national averages

Three additional reports along with the summary on Qnet: index admission file, beneficiary risk score file and an

MSPB episode file.

Facts about FY 14 VBP

LESS REIMBURSEMENT

A total of 1,451 hospitals got paid

less in FY 14 vs FY 13 for VPB. 1,231 got

paid more.

$1.1B at play in FY

14 VBPLargest increase .88%

Largest Decrease 1.14%

Change from FY 13 VBP

Comparison of State PerformanceValue Based Purchasing: FFY 14

StateAverage Bonus

Average Penalty % of Hospitals w Bonus

Florida .25% -.25% 52%

Georgia .23% -.30% 45%

Alabama .27% -.25% 54%

South Carolina .25% -.22% 54%

Tennessee .22% -.23% 37%

National Average .24% -.26% 45%

Value Based Purchasing Timelines

READMISSIONS REDUCTION PROGRAM

Payment Reform

Reform Readiness

Amount at Risk

2013 2014 2015 2016 2017

Readmission Program (a) 1.0% 2.0% 3.0% 3.0% 3.0%

Value Based Purchasing (b) 1.0% 1.25% 1.5% 1.75% 2.0%

Hospital Acquired Conditions (a)

1.0% 1.0% 1.0%

Total Potential Rates at Risk 2.0% 3.25% 5.5% 5.75% 6.0%

a: Represents a worst case scenario and a ceiling of the maximum penaltiesb: Represents a withhold of payment that can be earned back based on quality metrics

Readmission Reduction Program

Higher than expected admissions for– Heart failure– Acute Myocardial infarction– Pneumonia– And recently added Total Hip

and Knee

Current being paid on 2% Year 2. Performance periods are in play for FFY 16-18.

Readmission Timelines

Comparison of State PerformanceReadmissions: FFY 14

StateAverage Penalty % of Hospitals w NO Penalty

Florida -.35% 19%

Georgia -.30% 30%

Alabama -.35% 18%

South Carolina -.42% 40%

Tennessee -.52% 16%

National Average -.38% 34%

Tennessee Hospital Performance: FFY 14

Value Based Purchasing

Rea

dmis

sion

s

For FFY 2014

Penalized on Readmissions

Penalized on VBP Bonused on VBP

Georgia Hospital Performance: FFY 14


Rea

dmis

sion

s



Florida Hospital Performance: FFY 14


Rea

dmis

sion

s



Alabama Hospital Performance: FFY 14

-1.60%

-1.40%

-1.20%

-1.00%

-0.80%

-0.60%

-0.40%

-0.20%

0.00%-1.00% -0.50% 0.00% 0.50% 1.00%


Rea

dmis

sion

s



South Carolina FY 14 Hospital Performance


Rea

dmis

sion

s

Bonused on VBPPenalized on VBP


HOSPITAL ACQUIRED CONDITIONS

Payment Reform

Reform Readiness

Amount at Risk

2013 2014 2015 2016 2017

Readmission Program (a) 1.0% 2.0% 3.0% 3.0% 3.0%

Value Based Purchasing (b) 1.0% 1.25% 1.5% 1.75% 2.0%

Hospital Acquired Conditions (a)

1.0% 1.0% 1.0%

Total Potential Rates at Risk 2.0% 3.25% 5.5% 5.75% 6.0%

a: Represents a worst case scenario and a ceiling of the maximum penaltiesb: Represents a withhold of payment that can be earned back based on quality metrics

Hospital Acquired Conditions: Final Rule for FFY 2015

First Domain 35% : PSIsPerformance Period: 7/1/11-6/30/13

Second Domain 65%: CDCPerformance Period: CY 2012 & 2013

Pressure Ulcer Rate CLABSI

Foreign Object Left in Body CAUTI

Iatrogenic Pneumothorax Rate

Postoperative Physiologic and Metabolic Derangement Rate

Postoperative Pulmonary Embolism and Deep Vein Thrombosis Rate

Accidental Puncture and Laceration Rate

1% Medicare Reimbursement at risk: All or none penaltyLowest performing quartile will be penalized

HAC Domain Weightings3

6

CLABSI: 32.5%

CAUTI: 32.5%

Pressure Ulcer Rate: 8.33%

Foreign Object LeftIn Body: 8.33%

DOMAIN 1: 35% DOMAIN 2: 65%

Proposed Future Measures: Domain 2

First Domain: PSIs Second Domain: CDC

Pressure Ulcer Rate CLABSI

Foreign Object Left in Body CAUTI

Iatrogenic Pneumothorax Rate SSI Following Colon Surgery (FY 2016)

Postoperative Physiologic and Metabolic Derangement Rate

SSI Following Abdominal Hysterectomy (FY 2016)

Postoperative Pulmonary Embolism and Deep Vein Thrombosis Rate

Methicillin-Resistant Staphylococcus Aureus (MRSA) Bacteremia (FY 2017)

Accidental Puncture and Laceration Rate Clostridium Difficile (FY 2017)

Questions?Thank you.

Mastering the Mandatory Elements Of the Affordable Care Act February 26, 2014.

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