The Outlook for ACA Healthcare Delivery Reforms

Guest post by Ken Perez, vice president of healthcare policy, Omnicell, Inc.

Ken Perez
Ken Perez

The Patient Protection and Affordable Care Act (ACA) mandated five major healthcare delivery reforms that collectively aim to improve care quality and slow the growth of healthcare spending. In the five years since passage of the ACA, each of these delivery reforms has been implemented, revised and broadened.

What is the outlook for these changes? Clearly, the long-term strategic intent of the Obama administration is to shift Medicare payments from fee for service to fee for value. On Jan. 26, 2015, Health and Human Services Secretary Sylvia Burwell set forth quantified goals and an aggressive timeline for directing an increasing share of Medicare payments through alternative payment models (APMs) such as accountable care organizations (ACOs) and bundled payments, from 20 percent in 2014 to 50 percent in 2018. Let’s consider each of the major healthcare delivery reforms.

Accountable Care Organizations

On January 11, the Centers for Medicare & Medicaid Services (CMS) announced that 477 organizations are participating in one of Medicare’s four accountable care programs.

With 434 current participants, the Medicare Shared Savings Program (MSSP) accounts for the vast majority (91 percent) of the total. Although the total number of MSSP ACOs has grown steadily each year since the program’s inception in 2012, cumulatively about 100 ACOs (19 percent) have dropped out of the program.

Medicare’s first ACO program, the higher-risk, higher-reward Pioneer ACO Model, suffered numerous departures during the second half of 2015, as the number of Pioneers has dropped from 32 original participants announced in December 2011 to a current total of nine, a 72 percent decline. However, some of the departing Pioneers have transferred to the MSSP or the even higher-risk, higher-reward Next Generation ACO Model, which was launched in March 2015.

CMS also disclosed that 21 organizations are participating in the Next Generation ACO Model, including five former Pioneers. The remaining 13 of the 477 ACOs are the initial participants in the first disease-specific Medicare ACO program, the Comprehensive ESRD Care Model, which was announced in October 2015.

Despite these seemingly impressive numbers, to achieve the aforementioned goal of flowing half of Medicare payments through APMs by 2018, CMS needs even more growth in the number of Medicare ACOs coming onboard in the next couple of years, perhaps 150-200 net new ACOs per year in 2017 and 2018.

Bundled Payments

In 2013, CMS launched the Bundled Payments for Care Improvement Initiative (BPCI), a voluntary program which offers providers four episode-based payment models. In three of the models, implementation is divided into two phases. During Phase 1, “the preparation period,” CMS shares data and helps the participating providers learn in preparation for Phase 2, “risk-bearing implementation,” in which the providers begin bearing financial risk with CMS for some or all of their episodes. CMS required all participants to transition at least one episode (e.g., Acute Myocardial Infarction) into Phase 2 by July 1, 2015, to continue participating in the BPCI.

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CMS Moves to “Modernize” Medicaid Plans

Ken Perez
Ken Perez

Guest post by Ken Perez, vice president of healthcare policy, Omnicell.

Since the passage of the Patient Protection and Affordable Care Act, most of the health reform activity in the Medicaid arena has primarily been about expansion of coverage. According to the Centers for Medicare and Medicaid Services (CMS), as of February 2015, 70.5 million people—more than one in every five Americans—were enrolled in Medicaid or the Children’s Health Insurance Program (CHIP), which represents an increase of almost 40 percent from the number enrolled at the end of 2009.

However, on May 26, CMS aimed its sights on improving the quality of care delivered by Medicaid, issuing a 653-page proposed rule to “modernize the Medicaid managed care regulations,” which have not been revised in a decade. The proposed rule faces a public comment period that will continue thru July 27.

The changes presented in the proposed rule would align the regulations governing Medicaid managed care with those of other major sources of coverage, including Medicare Advantage (MA) plans and Qualified Health Plans (QHPs), which are offered thru health insurance exchanges (marketplaces). CMS has said that the proposed Medicaid measures will emphasize evaluating health outcomes and the patient experience enrollees have with private plans. In addition, the proposed rule mandates public reporting of information on quality of care, as well as the use of financial incentives to reward Medicaid managed care plans that meet quality measures, a la Medicare Advantage Star Ratings.

CMS’s announcement has been met with mostly favorable responses. “It was about time for the changes” has been a common refrain, with the revisions viewed as a natural, logical progression.

How big is the market that will be impacted by the changes? Per CMS, Medicaid managed care organizations (MCOs) have grown from handling 8 percent of Medicaid beneficiaries in 1992 to about 70 percent of the 70 million Medicaid enrollees today—almost 50 million people. That figure compares with 17.3 million MA enrollees as of January 2015.

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Three Strategies to Tackle Health IT Trends in 2014

Brian Schmitz
Brian schmitz

Guest post by Brian Schmitz, director of future product marketing for HP LaserJet and Enterprise Solutions, Imaging and Printing Group.

In today’s dynamic healthcare industry, it is important that providers embrace modern information technology and innovations to achieve organizational success. It’s no surprise that the health IT landscape is changing rapidly, driven by the interrelated trends of mobility, cloud, security and big data. This will fundamentally change the way that healthcare organizations communicate and collaborate moving forward. But, these health IT trends are not only driving change, they are also serving as the path to deal with many of the new dynamics created in today’s office environment.

In turn, healthcare organizations will need a “new style of IT” that helps them become more agile and efficient while reducing operational costs. In addition to these megatrends, changes to government regulations are driving an industry-wide shift to improve healthcare IT, which have increased healthcare IT spending projections to $34.5 billion in North America.

There will be an abundance of technology resources available to help healthcare providers facilitate this transition; however, IT decision makers must be able to identify the technologies that will work best for their business. The following three strategies are key consideration points when looking for new technologies to help you manage IT megatrends.

Benefit from Healthcare Big Data

Regulatory changes associated with the Patient Protection and Affordable Care Act (PPACA) will create a surge of newly insured patients. The Congressional Budget Office expects that the PPACA will cover around 14 million of the uninsured in 2014 and 25 million by the end of the decade. There is a significant financial opportunity with these new patients, but it is important to consider that the number of practitioners will not immediately increase to accommodate this influx.

Investing in technology and tools designed to specifically address big data and the vast amounts of patients’ personal information will help healthcare organizations provide more personalized care to these newly insured patients. By selecting tools that help collect, store and search for patient information, healthcare organizations can increase productivity by significantly reducing time spent managing patient records. Converting documents into searchable digital formats is an important part of this process, and educating staff on how to properly scan and organize documents in their digital form will help make patient data more accessible and usable.

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The “Chase” Involved in Implementing the Affordable Care Act

Ken Perez
Ken Perez

Guest post by Ken Perez, senior vice president and director of healthcare policy, MedeAnalytics, Inc. 

Chase scenes—usually involving cars, motorcycles or speedboats—are an adrenaline-producing staple of the Bourne movies, which are some of my favorites. In these scenes, one party, the villain, pursues another party, the hero. The chased tries to evade the chaser by choosing a circuitous, complex route, and often, some sort of distraction or unexpected intervention—such as a train or crowd—prevents the chaser from catching the chased.

Implementing the Affordable Care Act (ACA) can be likened to a long, long chase scene in which significant segments of the public are being asked to chase after the law, i.e., comply with it. But the ACA’s route has certainly been circuitous and complex, and there have been numerous distractions that may ultimately leave some of the populace in the dust of ignorance and nonparticipation.

One can’t blame the public. The ACA is complex, multidimensional in scope, and it features a lengthy, multi-year rollout. A product of two enormous pieces of legislation—the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act—the ACA totalled, before consolidation, over 2,400 pages and contained more than 450 sections.

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The Weak Underbelly of Sustainable Growth Rate Reform Proposals

Perez

Guest post by Ken Perez, Director of Healthcare Policy and Senior Vice President of Marketing, MedeAnalytics, Inc.

What do all of these pieces of legislation or plans have in common?

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