pathologists and value-based care: risks and rewards€¦ · pathologists and value-based care:...

Pathologists and Value-Based Care:Risks and Rewards

Donald Karcher, MD

Chair, Department of Pathology

George Washington University Medical Center

Pathologists and Value-Based Care:Risks and Rewards

We’ll discuss . . .

• Where value-based care came from

• The current models of value-based care

• MACRA: The next step toward value-based care

• Impact of value-based care on pathology practice

• How pathologists can prepare for value-based care

The dream . . .

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

. . . the challenge

So what’s wrong with the traditional health care system?

• No built-in system for coordination of care

• No real incentive to give high-quality care

• Little connection between care of individual patients and the health of the population

• No effective way to control costs volume rewarded over value

17.5% in 2014

Modern health care reform: The “triple aim”

• Better quality care for individuals

• Improved health for the population

• Lower cost

Value =Quality/Outcome

Cost

The goal: Value-based health care

value rewarded over volume

Value-based health care: Where did it come from?

• Institute of Medicine – Crossing the Quality Chasm: A New Health System for the Twenty-First Century, 2001 “Health care that is safe, effective, patient-centered, timely, efficient, and equitable”

• Donald Berwick – Institute for Healthcare Improvement, Harvard School of Public Health

• Elliott Fisher – Institute for Health Policy and Clinical Practice, Dartmouth Medical School

• Private payers – Have been driving the movement to value-based care from the beginning.

Value-based health care: Where did it come from?

Federal Legislative History

2000 – Benefits Improvement and Protection Act

- Beginning of “pay-for-performance” (P4P)

2005 – Medicare Physician Group Practice Demo.

2009 – HITECH Act “Meaningful Use” of HIT

2010 – Affordable Care Act

- CMS Medicare Shared Savings Program ACOs

- CMS CMMI Pioneer ACOs

- Expanded other value-based and P4P models

Value-based health care . . . so far

• Accountable care organizations

• Patient-centered medical homes

• Bundled payment arrangements

• Pay-for-performance (P4P)

• Meaningful use of HIT

• __________________??MACRA

2015 – HHS announced targets for value based payments

• By end of 2016

- 85% of provider payments value-based

- 30% of payments “alternative” models (done by 3/16)

• By end of 2018

- 90% of provider payments value-based

- 50% of payments “alternative” models

2015 – HHS announced targets for value based payments

• By end of 2016

- 85% of provider payments value-based

- 30% of payments “alternative” models*

• By end of 2018

- 90% of provider payments value-based

- 50% of payments “alternative” models*

*MACRA advanced alternative payment models (APMs)??

Accountable care organizations: What are they?

• Health care organizations that accept accountability for the . . .

- Quality of care

- Health of the population served

- Per capita cost of care for a designated

population

• Formed by combination of providers and/or hospitals

group practice, network of individual provider practices, joint

venture/partnership of hospital(s) and providers, hospital-

employed providers, etc.

>50% are physician group-operated

Accountable care organizations: What are they not?

HMOs by another name?

HMO ACO

1. Better quality care for individuals* ?? +

2. Improved health for the population* ? +

3. Lower cost* + +

*HIT/informatics can now facilitate all three

Accountable care organizationsTotal Number of ACOs – 2011-2016

Source: Accountable Care Learning Collaborative

Source: Accountable Care Learning Collaborative

857 as of 10/2016

Accountable care organizations:Different models as of 1/2015

CMS Medicare Shared Savings Program (MSSP) ACOs………………………… 427

CMS CMMI Pioneer ACOs….... 23

Medicaid ACOs……………….... 16 states

Private sector ACOs…………… 278

Total 744

Source: Accountable Care Learning Collaborative

Accountable care organizations:Different models as of 1/2016

CMS Medicare Shared Savings Program (MSSP) ACOs………………………… 434

CMS CMMI Pioneer ACOs….... 12

CMS CMMI Next-Gen ACOs…. 21

CMS ESRD ACOs……………... 13

Medicaid ACOs……………….... 17 states

Private sector ACOs…………… 341

Total 838

Source: Accountable Care Learning Collaborative

Accountable care organizationsNumber of ACOs by State − 1/2016

Source: Accountable Care Learning Collaborative

Accountable care organizationsNumber of ACOs by Hospital Region − 1/2016

Source: Accountable Care Learning Collaborative

Accountable care organizationsTotal Covered Lives in ACOs – 1/2016

Source: Accountable Care Learning Collaborative

Accountable care organizations% Covered Lives in ACOs by Hospital Region − 1/2016

Source: Accountable Care Learning Collaborative

Accountable care organizationsTotal Covered Lives in ACOs – By 2020

Source: Accountable Care Learning Collaborative

Accountable care organizationsCovered Lives in ACOs by Payer – 1/2016

Source: Accountable Care Learning Collaborative

Pathologists and ACOs

Number of pathologists currently participating in one or

more ACOs . . .

• 2011 CAP Practice Characteristics Survey 5%

• 2014 CAP Practice Characteristics Survey 17%

• 2016 CAP Practice Leader Survey 30%

Accountable care organizationsTotal Covered Lives vs. Pathologists in ACOs

Sources: ACO Data – Accountable Care Learning Collaborative; Pathologist Data – CAP

% Path

olo

gists in A

CO

s8

0 7

0 6

0 5

0 4

0 3

0 2

0 1

0 0

Accountable care organizations:Common elements

• Coordination of care key to success

−Chronic disease management, transitions of

care (i.e. handoffs), population health

management, etc.

• Use of EHR and informatics to improve care,

manage utilization, and monitor performance

• Payment: − Based on meeting quality measures

− Shared FFS savings capitation,

bundled payments, etc.

Accountable care organizations:Different models

CMS Medicare Shared Savings Program ACO

• Basic, entry-level ACO

• First cohort of 27 in April, 2012; now 434

Accountable care organizations:Different models

CMS Medicare Shared Savings Program ACO

• Accountable for the . . .

- Quality of care – 34 quality measures

- Cost of providing care (compared to past/benchmark)

• Costs and savings still based on fee-for-service

• ACO can share in FFS savings and/or be at risk for

added costs (Tracks 1, 2, and 3)

Accountable care organizations:Different models

CMS Medicare Shared Savings Program ACO

34 quality measures

• Patient experience – 8 (e.g. timely appts.)

• Care coordination – 10 (e.g. all readmissions,

unplanned admissions for CHF, etc.)

• Preventive health – 9 (e.g. flu vaccination)

• At-risk pop. care – 7 (e.g. hgb A1c control, LDL control,

etc.)

Accountable care organizations:Different models

CMS Medicare Shared Savings Program ACO

Risk Tracks

• Track 1 – Shared savings (“upside” risk) only

• Track 2 – Shared savings + losses (“upside” and

“downside” risk) higher shared savings

• Track 3 – Shared savings + losses even higher

shared savings + higher risk for losses

Accountable care organizations:Different models

CMS Medicare Shared Savings Program ACO

Risk Tracks 2016

• Track 1 – Shared savings (“upside” risk) only 95%

• Track 2 – Shared savings + losses (“upside” and

“downside” risk) higher shared savings 1%

• Track 3 – Shared savings + losses even higher

shared savings + higher risk for losses 4%

ACO performance – early results (2014)

CMS Medicare Shared Savings Program

(MSSP) ACOs

• After first full year 28% beat benchmarks

1-2% overall savings

CMS CMMI Pioneer ACOs

• 9 dropped out after first year

• After first two years 11/23 (48%) beat benchmarks

1% overall savings

Private sector ACOs 2-12% overall savings

ACO performance – as of 2015

CMS Medicare Shared Savings Program

(MSSP) ACOs

• Beat benchmarks

Total 31%

Started in 2012 42%

Started in 2013 37%

Started in 2014 22%

CMS CMMI Pioneer ACOs

• 6/12 (50%) beat benchmarks

Accountable care organizations:Different models

Next Generation ACO Model

• Even more advanced model than Pioneer ACO

• Ultimately moves away from recent expense

benchmark greater incentives to move to

capitated payments

• First cohort in January, 2016 = 21

Patient-centered medical home

• Care delivery model based on “partnership” between

individual patients and their provider

• Usually primary care; may be specialty care

• Team-based care coordinated across the continuum of

care

• Focused on quality and patient safety

• Currently, >8,000 accredited PCMHs (accredited by

TJC, NCQA, etc.)

PCMHs and ACOs(James Crawford, 2014)

PCMHPractices

Hospital(s)Emergency Dept.SNF, Rehab.

Laboratory, Imaging, Pharmacy, “Urgent Care” Clinic

Patient-centered medical home

CMMI Advanced Primary Care Practice Demonstration

• 2011-2014 pilot project extra payment for care coordination activities and payment of shared FFS savings

• 434 participating sites

CMMI Comprehensive Primary Care Plus

• Started April, 2016

• Financial incentives and greater flexibility for improving primary care

• Up to 5,000 practices, 20,000 providers, 25 million patients

Bundled payment arrangements

• Single “fixed dollar” global payment to hospital, provider

organization, and/or individual providers for single

“episode of care”

• Similar to Medicare DRGs for hospitals, but . . .

providers may now be included in bundle

• Distribution of payment is determined internally

• CMMI developing several models for inpatient and/or

outpatient care

Bundled payment arrangements

CMMI Medicare Bundled Payments for Care

Improvements (BPCI)

• Demonstration project, started in 2013

• 4 models

1. Retrospective acute-care hospital stay

2. Retrospective acute-care hospital + post-acute care

3. Retrospective post-acute care

4. Prospective acute-care hospital + post-acute care

• 48 clinical condition episodes

Bundled payment arrangements

CMMI Medicare Bundled Payments for Care

Improvements (BPCI)

• Demonstration project, started in 2013

• 4 models

1. Retrospective acute-care hospital stay

2. Retrospective acute-care hospital + post-acute care*

3. Retrospective post-acute care*

4. Prospective acute-care hospital + post-acute care*

• 48 clinical condition episodes

*includes providers

Bundled payment arrangements

CMMI Comprehensive Joint Replacement Model*• Began April 1, 2016

CMMI Oncology Care Model*• Began July, 2016 (5 year demo)

• For cancer chemotherapy “episode of care”; begins with first chemotherapy; includes all services for 6 months

• FFS + bundled payment + performance-based bonus (via Medicare and private payers) for improving coordination and quality of care and/or decreasing cost

*providers included

Pay-for-performance (P4P)

• Started in 2000 with Benefits Improvement and

Protection Act

• Reinforced with

2009 HITECH Act

2010 Affordable Care Act

• Applies to hospitals and providers

• Started as voluntary bonus payments for good

performance Now rewards + penalties

Pay-for-performance (P4P)

• Physician Quality Reporting System (PQRS)

• Value-Based Modifier (VBM) for providers

• Value-Based Purchasing (VBP) for hospitals

• Meaningful Use of HIT

Physician quality reporting system (PQRS)

• Provider payment based on reporting of quality

measures

• Reporting by various means

Individual providers – Claims, registry, EHR, etc.

Group members – Registry, EHR, Web, etc.

• Quality measures must be approved by CMS;

process measures outcome measures

Physician quality reporting system (PQRS)

Pathology quality measures approved by CMS

Prior to 2015

• Breast cancer resection report elements

• Colorectal cancer resection report elements

• Barrett’s esophagus report elements

• Radical prostatectomy report elements

• HER2 by IHC in breast ca using ASCO/CAP guidelines

New in 2015

• Lung cancer biopsy/cytology report elements

• Lung cancer resection report elements

• Melanoma resection report elements

Physician quality reporting system (PQRS)

Pathology quality measures approved by CMS

Prior to 2015

• Breast cancer resection report elements

• Colorectal cancer resection report elements

• Barrett’s esophagus report elements

• Radical prostatectomy report elements

• HER2 by IHC in breast ca using ASCO/CAP guidelines

New in 2015 MACRA final rule on October 14

• Lung cancer biopsy/cytology report elements outcome

• Lung cancer resection report elements outcome

• Melanoma resection report elements outcome

Value-based modifier (VBM)

• Cost and quality (i.e. PQRS) data reported to CMS and used to calculate payment for services

• Implementation: Reporting and impact schedule

As of 2015 All providers Impact in 2017

* impact if PQRS data not reported

Meaningful (MU) use of HIT

• HITECH Act of 2009

• Encourages hospitals and providers to “meaningfully”

use certified EHR; for providers ambulatory care only

• Payment penalties: 1% 5% over five years

• Essentially no current measures appropriate for

pathologists

• “Hardship” exemption for pathologists granted by CMS

Consequences of PQRS, VBM, MU

By 2019 . . .

Failure to report PQRS (-2%, -4% -6%)

Failure to attest to MU (-5%)

-2%

-4%

-6% -11%-5%

Medicare Sustainable Growth Rate (SGR)

• Balanced Budget Act of 1997

• Increase in Medicare payments to physicians could not

exceed growth in GDP

• Never implemented Congress passed temporary “fix”

every year for 17 years

• If had been implemented in 2015 27.5% decrease in

physician payments

Medicare Sustainable Growth Rate (SGR)

First attempt to permanently fix SGR – Failed,

instead . . .

PAMA – Protecting Access to Medicare Act of 2014

Medicare Sustainable Growth Rate (SGR)

Second attempt to permanently fix SGR

MACRA – Medicare Access and CHIP

Reauthorization Act of 2015

MACRA

Quality Payment Program

Merit-Based Incentive Payment System (MIPS)

Alternative Payment Models (APMs)

MACRA

Merit-Based Incentive Payment System (MIPS)

• Replaces PQRS, VBM, and MU; has 4 components

1. Quality

2. Resource use

3. Clinical practice improvement

4. Advancing care information (formerly MU)

MACRA

Merit-Based Incentive Payment System (MIPS)

• Replaces PQRS, VBM, and MU; has 4 components

1. Quality – 60% in year 1

2. Resource use – 0% in year 1

3. Clinical practice improvement – 15% in year 1

4. Advancing care information (formerly MU) – 25% in year 1

• Each provider receives a composite performance score based on

the above distribution; scoring in 2017 for 2019 payment

• Program must be budget-neutral Winners and losers

• Gain/loss range: 2019 ± 4%; 2020 ± 5%, 2021 ± 7%; 2022 ± 9%

MACRA

Merit-Based Incentive Payment System (MIPS)

Impact on pathology payments (per CAP analysis) . . .

MACRA

Alternative Payment Models (APMs)

• Participation in eligible Advanced APM a) exempts provider from

MIPS and b) leads to payment rewards

2019-2024: Automatic +5% payment adjustment

2026 and on: +0.75% annual adjustment (others get +0.25%)

• Payment and patient thresholds for eligible Advanced APM

Medicare Only Option% Payments

in an Advanced APM

All Payer Option% Payments

in an Advanced APM

2019-2020 25% NA

2021–2022 50% 25% Medicare/25% all other payers

2023 and on 75% 25% Medicare/50% all other payers

MACRA

Alternative Payment Models (APMs)

• Participation in eligible Advanced APM a) exempts provider from

MIPS and b) leads to payment rewards

2019-2024: Automatic +5% payment adjustment

2026 and on: +0.75% annual adjustment (others get +0.25%)

• Payment and patient thresholds for eligible Advanced APM

Medicare Only Option% Patients

in an Advanced APM

All Payer Option% Patients

in an Advanced APM

2019-2020 20% NA

2021–2022 35% 20% Medicare/15% all other payers

2023 and on 50% 20% Medicare/30% all other payers

MACRA

Alternative Payment Models (APMs)

• Participation in eligible Advanced APM a) exempts provider from

MIPS and b) leads to payment rewards

• Examples . . .

CMS ACOs (MSSP Tracks 2 and 3, Next-Gen, etc.)

Bundled payments (e.g. Oncology Care Model with 2-sided risk)

PCMHs (e.g. Comprehensive Primary Care Plus Model)

Physician-focused payment models (PFPMs)

• Eligible Advanced APM – Certain requirements, including “more than

nominal” downside financial risk

MACRA

Alternative Payment Models (APMs)

• Participation in eligible Advanced APM a) exempts provider from

MIPS and b) leads to payment rewards

• Examples . . .

CMS ACOs (MSSP Tracks 2 and 3, Next-Gen*, etc.) Track 1+

Bundled payments (e.g. Oncology Care Model with 2-sided risk**)

PCMHs (e.g. Comprehensive Primary Care Plus Model*)

Physician-focused payment models (PFPMs) ?? for pathologists

* Extended to 2018 cohort

** Accelerated to 2017

MACRA – “Final Rule with Comment” Oct. 14

Highlights . . .

• Very flexible reporting requirements in 2017

• All 8 pathology PQRS quality metrics approved for MIPS,

3 newest metrics declared “outcome-based”

• Non-patient-facing = <100 patient-facing encounters per

year; if <25% of group patient-facing, entire group NPF

Non-patient-facing providers require reporting on

fewer quality and practice improvement metrics

MACRA – “Final Rule with Comment” Oct. 14

Highlights . . .

• Very flexible reporting requirements in 2017

• All 8 pathology PQRS quality metrics approved for MIPS,

3 newest metrics declared “outcome-based”

• Non-patient-facing = <100 patient-facing encounters per

year; if <25% of group patient-facing, entire group NPF

• Pathologists at independent labs qualify

• Lower downside financial risk to qualify as advanced

APM

• MSSP Track 1+ ACO proposed

MACRA – MIPS Metrics Reporting

• Reporting options in 2017 2019 payment

adjustment . . .

1. Report nothing 4% negative payment adjustment

2. Report anything on one metric neutral payment

adjustment

3. Report required metrics for 90 days neutral or

small positive payment adjustment

4. Report required metrics for full year moderate

positive payment adjustment

• Qualified Clinical Data Registry (QCDR)

Health Care Payment Learning and Action NetworkAPM Framework

Category 1 – FFS, no link to quality/value

Category 2 – FFS, with link to quality/value (P4P, MIPS, etc.)

Category 3 – APMs built on FFS architecture (MSSP ACOs,

Next-Gen ACOs [early], etc.)

Category 4 – Population-based payment (e.g. capitation,

bundled payments, etc.)

. . . the challenge

Value-based health care:Challenges for pathologists

• Meet MACRA/MIPS metrics

• Establish value-added roles in support of ACOs, PCMHs, bundled payment arrangements, and other APMs

Gain recognition* for these roles

Get paid fairly* for these roles

*as judged by colleagues/organization

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

• Consultation – Pre-order and post-result

• Assist in chronic disease/population health

management

• Ensure actionable lab/pathology result format in EHR

• Use HIT/informatics for practice analytics, care

improvement

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

CP – Develop lab test order sets, testing algorithms, test

“formularies”; emphasis on molecular and other high-cost

tests the right test at the right time

AP – Manage ancillary testing in surgical pathology,

hematopathology

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

• Consultation – Pre-order and post-result

- With clinicians

- With patients

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

• Consultation – Pre-order and post-result

• Assist in chronic disease/population health

management

- Use HIT for scheduled testing alerts, testing

compliance/test result tracking, intervention alerts

- Develop and apply clinical decision support tools

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

• Consultation – Pre-order and post-result

• Assist in chronic disease/population health

management

• Ensure actionable lab/pathology result format in EHR

Provides clinical decision support to clinicians

Value-based health care: Meeting the challenges

Value-added roles for pathologists . . . some

examples:

• Lab utilization management – CP and AP

• Consultation – Pre-order and post-result

• Assist in chronic disease/population health

management

• Ensure actionable lab/pathology result format in EHR

• Use HIT/informatics for practice analytics, care

improvement, peer-review, etc.

“ACOs and value-based health care will bring on a renaissance for clinical pathology.”

“ACOs and value-based health care will bring on a renaissance for clinical pathology.”

− Donald Karcher, MDMay, 2012

What can anatomic pathologists do to survive/thrive with value-based care?

• Continue to do what they do

. . . but also (a few examples):

• Develop and follow evidence-based and cost-

effective diagnostic pathways (IHC, genomics, etc.)

• “Own” the AP report in the EHR make it clear,

user-friendly, clinician- and patient-centered,

actionable, and (if possible) integrated with

imaging and other studies

• Provide direct patient consultation (with the

concurrence of the patient’s clinician)

• Use AP’s unique perspective to assist in

organizational peer review and patient safety

• etc.

Payment of providers in VBC

APMs: ACOs and bundled payments

• Employee $ incentives

• Member FFS a/o share in savings/losses*

FFS a/o share in bundled payment*

• Vendor/subcontractor low FFS

*Determined by internal negotiation, based on perceived contributions as judged by colleagues/organization

“As soon as possible, Medicare should extend

competitive bidding to medical devices,

laboratory tests, radiographic diagnostic

services, and all other commodities.”

− The Center for American Progress, et al

NEJM, August 1, 2012

Health care reform and value-based care: Looking over the horizon

• Population health management, coordinated and

team-based care delivery will be the norm, with HIT

and clinical informatics as key tools

• Pure FFS will be mostly replaced by a value-based

payment system some combination of value-

based FFS, capitation, and bundled payment

(APMs); eventually, FFS reserved for

“commodities” only?

• All payment will be impacted by quality metrics,

increasingly outcome-based

• Payment of providers increasingly determined by

internal sharing arrangements

Value-based care and the CAP

• Advocacy for P4P, MU, and now MACRA

• CAP ACO Network – 2011-2016, ~70 members

• Member, Accountable Care Learning Collaborative

• CAP value-based care strategic initiative started in 2015

• “From Volume to Value” at www.cap.org (coming . . . still

under construction) Practice Management Resource

Center: Glossary of VBC terms, practice modeling tools,

instructional videos, etc.

Value = Quality/Outcome

Cost