healthcare reform · • 11--year training program for recent year training program for recent...

10/26/2010

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HEALTHCARE REFORMHEALTHCARE REFORMWhat’s next? What’s next?

Shawn Y. DeGroot, C.H.C.-F., C.C.E.P., C.H.R.C.

Vice President of Corporate Responsibility

Regional Health

Healthcare ReformHealthcare Reform

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HEALTHCARE REFORMHEALTHCARE REFORM

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�� March 23, 2010March 23, 2010

�� Cost $940 billion over 10 yearsCost $940 billion over 10 years

�� Reduce the deficit by $143 billionReduce the deficit by $143 billion

�� Provide covers for 32 million more Provide covers for 32 million more AmericansAmericans

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“Reform law delivers ammo“Reform law delivers ammo

to battle Fraud”to battle Fraud”

Modern Healthcare, March 29, 2010Modern Healthcare, March 29, 2010

“Reform Law Delivers Ammo to Reform Law Delivers Ammo to Reform Law Delivers Ammo to Reform Law Delivers Ammo to

Battle Fraud”Battle Fraud”Battle Fraud”Battle Fraud”

Modern Healthcare, March 29, 2010


�� Financial EnvironmentFinancial Environment

�� Mandated 0.25% marketMandated 0.25% market--basket cut basket cut 2011 2011

�� Estimated $201 millionEstimated $201 million

�� $157 billion over 10 years$157 billion over 10 years

�� Proposed 0.1% cut in hospital IP ratesProposed 0.1% cut in hospital IP rates

�� Increased medicalIncreased medical--device reimbursementdevice reimbursement

�� 5 devices (determined 85 devices (determined 8--11--10)10)

�� AddAdd--on paymentson payments

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�� Patients choosing to utilize OP/ASCPatients choosing to utilize OP/ASC

�� Severely ill are left for hospitalsSeverely ill are left for hospitals

�� Physician practices:Physician practices:

��MPFS 90% to 75% utilization effective 2011 MPFS 90% to 75% utilization effective 2011 for CT’s & MRI’s for CT’s & MRI’s

��>1 diagnostic imaging>1 diagnostic imaging

�� 11stst test 100% reimbursementtest 100% reimbursement

�� 22ndnd test from 75% test from 75% now 50% effective 7now 50% effective 7--11--1010



�� Funding for fraud enforcement by $350 Funding for fraud enforcement by $350 million over 10 years.million over 10 years.

�� HHS has authority to suspend payments HHS has authority to suspend payments on questionable claimson questionable claims

�� Penalties relating to:Penalties relating to:

��High readmission rates effective 2013High readmission rates effective 2013

��HAI effective 2015HAI effective 2015

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�� Doctors could benefit under the Medicaid Doctors could benefit under the Medicaid programprogram

�� PCP = 100% of Medicare payment ratesPCP = 100% of Medicare payment rates

�� Disproportionate Share HospitalDisproportionate Share Hospital

�� $36 billion reduction 2014$36 billion reduction 2014


PPACA PPACA

�� CP is mandatoryCP is mandatory

�� Condition of Condition of enrollmentenrollment

�� Boards are expected Boards are expected to be activeto be active

�� Increase Board Increase Board accountabilityaccountability

CostsCosts

�� Impact to CPImpact to CP

�� CO at the tableCO at the table

�� Board operations vs. Board operations vs. oversightoversight

�� Quality of Care & Quality of Care & ComplianceCompliance

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�� Strategic assessment of readinessStrategic assessment of readiness

�� Cost controlsCost controls

�� InefficienciesInefficiencies

�� Base DRG reductionsBase DRG reductions

�� 1% in 20131% in 2013

�� 2% in 20172% in 2017

�� Paradigm shift from crisisParadigm shift from crisis--driven to driven to preventive health maintenancepreventive health maintenance


�� Strategic assessment for readinessStrategic assessment for readiness

�� Uncompensated care will decreaseUncompensated care will decrease

�� 2019 expansion2019 expansion

�� 32 million with additional coverage32 million with additional coverage

��½ anticipated to be Medicaid½ anticipated to be Medicaid

�� Shift in insurer mixShift in insurer mix

��Decrease in overall reimbursement per patientDecrease in overall reimbursement per patient

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�� Strategic assessment for readinessStrategic assessment for readiness

�� Manage clinical costsManage clinical costs

�� Effective admission to dischargeEffective admission to discharge

�� Construct efficient patient flowConstruct efficient patient flow

�� Establish process to intervene and proactively Establish process to intervene and proactively managemanage

��NEW covered lives NEW covered lives

�� Lacked preventive care previouslyLacked preventive care previously

�� Anticipated higher cost per memberAnticipated higher cost per member

�� Nurses in greater demandNurses in greater demand


�� 2014 all US citizens to maintain essential 2014 all US citizens to maintain essential health coverage or face a penalty.health coverage or face a penalty.

�� Penalties begin at 1% of taxable income Penalties begin at 1% of taxable income

�� Exemptions and rebates Exemptions and rebates when paying when paying 8% 8% of incomeof income

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State…of ConfusionState…of Confusion

US District JudgeUS District Judge

…rejected the claim …rejected the claim that requiring that requiring Americans to buy Americans to buy health insurance is health insurance is unconstitutional.unconstitutional.

DiedrichDiedrich

State…of ConfusionState…of Confusion

U.S. District Judge VinsonU.S. District Judge Vinson

…believes it has yet …believes it has yet to be determined to be determined whether the mandate whether the mandate requiring people to buy requiring people to buy health insurance is health insurance is constitutional or not…constitutional or not…

Associated PressAssociated Press

October 18, 2010October 18, 2010

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State…of confusionState…of confusion

Judge Vinson:Judge Vinson:

Members of Congress who voted in Members of Congress who voted in favor of the bill never actually favor of the bill never actually referred to the penalties for not referred to the penalties for not buying insurance as "taxes" perhaps buying insurance as "taxes" perhaps to minimize any backlash they might to minimize any backlash they might receive from constituents.receive from constituents.


�� Hearing scheduled 12Hearing scheduled 12--1616--1010

�� 20 states20 states

�� National Federation of Independent National Federation of Independent BusinessBusiness

�� Congress intentionally unclear when Congress intentionally unclear when penalties were createdpenalties were created

�� Congress is overstepping constitutional Congress is overstepping constitutional authorityauthority

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More confusion????More confusion????

�� Taxpayers must wait until 2014 when Taxpayers must wait until 2014 when changes take effect to file lawsuits.changes take effect to file lawsuits.

�� Opponents of reform are turning to Opponents of reform are turning to the courtsthe courts

�� Social Security ActSocial Security Act

�� Civil Rights ActCivil Rights Act

�� Voting Rights ActVoting Rights Act

LawsuitsLawsuits

�� Alabama, Arizona , Colorado, GeorgiaAlabama, Arizona , Colorado, Georgia

�� Indiana, Idaho, Louisiana, MichiganIndiana, Idaho, Louisiana, Michigan

�� Mississippi, Nebraska, Nevada, North Mississippi, Nebraska, Nevada, North DakotaDakota

�� Pennsylvania, South Carolina, South DakotaPennsylvania, South Carolina, South Dakota

�� Texas, Utah and WashingtonTexas, Utah and Washington

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LogicLogic

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�� Women’s & Children’s HealthWomen’s & Children’s Health

�� Lifetime limit ban: 2010 <$750,000 Lifetime limit ban: 2010 <$750,000

�� Essential health benefits: MaternityEssential health benefits: Maternity

�� Rescissions of Coverage (benefit 15 million)Rescissions of Coverage (benefit 15 million)

�� Cover preventive servicesCover preventive services

�� Breast and cervical cancer, osteoporosis, Breast and cervical cancer, osteoporosis, colorectal, blood pressure, cholesterol, etc.colorectal, blood pressure, cholesterol, etc.

�� Screenings for infants, children, adolescentsScreenings for infants, children, adolescents

�� ImmunizationsImmunizations


�� Quality of care for better outcomesQuality of care for better outcomes

�� Reduce costsReduce costs

�� Increase payIncrease pay--for performance for performance

�� Increase penalties for nonIncrease penalties for non--compliance compliance or substandard care or substandard care

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Nurse managed community care clinicsNurse managed community care clinics

�� underservedunderserved

�� vulnerable populationvulnerable population

�� no regard to insurance or incomeno regard to insurance or income

�� affiliated with qualified health centeraffiliated with qualified health center


§§5316 Demonstration Project5316 Demonstration Project

•• $600,000$600,000

•• 11--year training program for recent year training program for recent graduated nurse practitionersgraduated nurse practitioners

$200 million in grants, 4 years$200 million in grants, 4 years

•• Funds maternal, infant, early childhood Funds maternal, infant, early childhood visitation programs to low income womenvisitation programs to low income women

••Better outcomesBetter outcomes

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�� FeeFee--forfor--service volumeservice volume--based model based model to improved outcomes or valueto improved outcomes or value

�� FiveFive--year pilot to test alternative year pilot to test alternative payment methodologiespayment methodologies

�� Payment bundling (8 conditions)Payment bundling (8 conditions)

�� Incentives to coordinate care from Incentives to coordinate care from diagnosis to discharge, rehab or HHdiagnosis to discharge, rehab or HH


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�� Compelling assessment to partnerCompelling assessment to partner

�� ReRe--evaluate accounting and financeevaluate accounting and finance

�� Review technology applications to track Review technology applications to track revenuerevenue

�� Understand ability to report qualityUnderstand ability to report quality

�� Volume shifts for Medicaid “health Volume shifts for Medicaid “health homes” from acute to nonhomes” from acute to non--acute settingsacute settings


�� “Health Homes” for Medicaid“Health Homes” for Medicaid

�� At least 2 chronic conditions ORAt least 2 chronic conditions OR

�� 1 chronic & serious mental health1 chronic & serious mental health

�� Provider is approved by HHSProvider is approved by HHS

�� Established infrastructure to provide serviceEstablished infrastructure to provide service

�� Comprehensive care managementComprehensive care management

�� Reduce readmissionReduce readmission

�� Improve chronic care coordinationImprove chronic care coordination

�� Procedures for referring Medicaid patient Procedures for referring Medicaid patient seeking treatment in ED to a HH Providerseeking treatment in ED to a HH Provider

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�� “Health Homes” for Medicaid“Health Homes” for Medicaid

�� ReRe--examine business model to prepare for examine business model to prepare for volume shiftsvolume shifts

�� Consider strategic alliancesConsider strategic alliances

�� Compliance ConsiderationsCompliance Considerations

??


�� Medicaid Exclusion from Participation Medicaid Exclusion from Participation §§65026502

�� Any entity that owns, controls or manages Any entity that owns, controls or manages an entity or is owned, controlled or an entity or is owned, controlled or managed by an individual or entity that managed by an individual or entity that has has unpaid overpaymentsunpaid overpayments, is suspended or , is suspended or excluded from participation or is affiliated excluded from participation or is affiliated with an entity that has been suspended or with an entity that has been suspended or excludedexcluded. .

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�� Quality measures & technologyQuality measures & technology

�� ValueValue--based purchasing incentivesbased purchasing incentives

��October 2012 discharges October 2012 discharges

�� Provides incentive paymentsProvides incentive payments

�� Hospital Compare public in 2012Hospital Compare public in 2012

�� HACs public in 2015HACs public in 2015

�� Hospital readmissionsHospital readmissions

�� Reduce payment October 2012Reduce payment October 2012

��More conditions to come in 2015More conditions to come in 2015


�� Quality measures & technologyQuality measures & technology

�� HITECH Act expanded HIPAA with CE’s and HITECH Act expanded HIPAA with CE’s and BA’s to enhance safeguards for privacyBA’s to enhance safeguards for privacy

�� Stimulus funds for EHRStimulus funds for EHR

��Medicare reimbursement reduction for failure to Medicare reimbursement reduction for failure to adoptadopt

�� Quality reporting increasesQuality reporting increases

�� Administrative burdensAdministrative burdens

�� Require new or enhanced IT systems to track Require new or enhanced IT systems to track and reportand report

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�� Accountable Care OrganizationsAccountable Care Organizations

�� Contract to manage care and curb spendingContract to manage care and curb spending

�� Share of savings for quality and costShare of savings for quality and cost--controlcontrol

�� Economic and legal challengesEconomic and legal challenges

�� Bonuses vs. payment for serviceBonuses vs. payment for service

�� Prohibitions on selfProhibitions on self--referralreferral

�� CollusionCollusion

�� State insurance regulatorsState insurance regulators

�� AntiAnti--trusttrust

�� COICOI

ACO BasicsACO Basics

Accountable care organizations, soon to be a part of Medicare, pay bonuses to networks of doctors and hospitals that achieve quality goals and slow healthcare spending. Policymakers have proposed three types of ACO networks in journal articles

Level one Level two Level three

�No financial risk for providers�Shared savings bonus�Basic quality, efficiency and patient-experience measured

�Risk for spending that exceeds targets�Greater shared savings bonus�Quality, efficiency and patient-experience measured

�Risk for full or partial capitation�Additional quality bonuses�Expanded reporting of quality, efficiency and patient-experience measures

Sources: Health Affairs, “A National Strategy to Put Accountable Care Into Practice,” May 2010, Journal of the American Medical Association, “Implementing Qualifications Critical and Technical Assistance for Accountable Care Organizations,” May 5, 2010

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�� Government oversightGovernment oversight

�� Establishes the Independent Payment Establishes the Independent Payment Advisory Board (IPAB)Advisory Board (IPAB)

�� Background screenings required prior to Background screenings required prior to billing Medicarebilling Medicare

�� Overpayments reported/returned 60 daysOverpayments reported/returned 60 days

�� Expands sunshine rulesExpands sunshine rules

��Disclose ownershipDisclose ownership

�� Bans new physicianBans new physician--owned hospitalsowned hospitals



�� CMS directed to reduce the feeCMS directed to reduce the fee--forfor--service service payment error rate in half by 2012payment error rate in half by 2012

��November 2009 12.4% or $35.4 billionNovember 2009 12.4% or $35.4 billion

�� HEAT (Health Care Fraud Prevention and HEAT (Health Care Fraud Prevention and Enforcement Action Team)Enforcement Action Team)

��HHS & DOJ joint effortHHS & DOJ joint effort

�� Requires dataRequires data--sharing among federal sharing among federal agencies.agencies.

�� Expanded RAC to Medicaid, Medicare Part DExpanded RAC to Medicaid, Medicare Part D

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�� Distribution of primary resourcesDistribution of primary resources


�� Expanded RAC to Medicaid, Medicare Part D Expanded RAC to Medicaid, Medicare Part D and Medicare Advantageand Medicare Advantage

�� Enhanced screening and oversight of Enhanced screening and oversight of providers and suppliersproviders and suppliers

�� Voluntary selfVoluntary self--disclosure protocol disclosure protocol


�� Title VI Transparency and Program Title VI Transparency and Program Integrity Section 6002Integrity Section 6002

�� Amends SSA manufactures must report Amends SSA manufactures must report pymtpymt or transfer of value to providers >$10or transfer of value to providers >$10

�� Applies to pharmaceutical, biotech and Applies to pharmaceutical, biotech and medical device manufacturersmedical device manufacturers

�� Reporting begins 3Reporting begins 3--3131--13 to preceding year13 to preceding year

�� Manufacturers to post information Manufacturers to post information searchable and downloadablesearchable and downloadable

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�� Title VI Transparency and Program Title VI Transparency and Program Integrity Section 6002Integrity Section 6002

�� Failure to report $1,000Failure to report $1,000--$10,000 for each $10,000 for each payment or transfer (not to exceed $150K)payment or transfer (not to exceed $150K)

�� CMP’sCMP’s

�� Additional compliance requirements Additional compliance requirements


�� Conflict of Interest ManagementConflict of Interest Management

�� Review and assess institution’s COI policies Review and assess institution’s COI policies and proceduresand procedures

�� Consider data base for collection of Consider data base for collection of disclosuresdisclosures

�� Develop auditing/monitoringDevelop auditing/monitoring

�� Identify COI Committee for the institutionIdentify COI Committee for the institution

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�� Insurance MandateInsurance Mandate

�� Congressional Budget Office predicts 4 Congressional Budget Office predicts 4 million to pay a finemillion to pay a fine

�� $4 billion IRS$4 billion IRS

�� 2016 $695 or % of household income2016 $695 or % of household income

�� Predict that majority of fines will come from Predict that majority of fines will come from those making more than 400% of poverty those making more than 400% of poverty levellevel

End of Life DecisionsEnd of Life Decisions

�� Lack of timely responseLack of timely response

�� Lack of response Lack of response

�� Altering (or destroying) Altering (or destroying) documentsdocuments

�� Ignoring issuesIgnoring issues

�� Misleading the government Misleading the government

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[email protected]@regionalhealth.com

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