Am I ready for risk in an Advanced

Alternative Payment Model ACO?

Melissa Gerdes, MD, FAAFP

Disclaimer

The material presented here is being made available by the American Academy of Family

Physicians for educational purposes only. Please note that medical information is constantly

changing; the information contained in this activity was accurate at the time of publication.

This material is not intended to represent the only, nor necessarily best, methods or

procedures appropriate for the medical situations discussed. Rather, it is intended to

present an approach, view, statement, or opinion of the faculty, which may be helpful to

others who face similar situations.

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individual using this material and for all claims that might arise out of the use of the

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Dr. Melissa Gerdes was chief medical officer of the Methodist Alliance

for Patients and Physicians (MAP2) in Dallas, Texas. MAP2 was one of

the first Medicare ACOs to generate savings, scoring top quartile in

quality by coordinating 15,000 Medicare beneficiaries’ care with

emphasis on quality, patient experience, and cost. To date, this

Medicare Shared Savings Track 1 program has saved CMS over $40

million in three years.

Dr. Gerdes has just started a new role as Medical Director of Clinical

Effectiveness with John Muir Health in Walnut Creek, California. She

will lead clinical integration, population health, quality improvement,

and safety for the 1000 physician member John Muir Physician

Network.

Dr. Gerdes earned a B.S. in Communications at Northwestern

University. She earned her M.D. at Loyola University Stritch School of

Medicine in Chicago, and completed her residency at the University of

Texas at Tyler, where she was chief resident. She has also served as

the President of the Texas Academy of Family Physicians and chaired

the Commission on Quality and Practice for the AAFP.

Objectives Identify basic elements of risk and how to evaluate

readiness

Describe how improvement in performance enables entities to take on risk

Recognize how risk is related to physician payment

Apply concepts to determine readiness to participate in a Medicare Alternative Payment Model ACOs

Risk in Healthcare Delivery Risk is the potential of gaining or losing something

of value

Risk can also be defined as the intentional interaction with uncertainty

Uncertainty is a potential, unpredictable, and uncontrollable outcome; risk is a consequence of action taken in spite of uncertainty

Wikipedia 2017

Why add risk to Healthcare?

Financial risk gives providers an incentive to reduce costs

Assessment for Readiness

Ask 5 whys?

Perform internal readiness assessment or hire a consultant to perform?

Do you have a good understanding of risk and type(s) of risk?

Do you have the right leadership, alignment, resources and time?

One Journey

Methodist Patient Centered ACO / MAP2

Dallas/Fort

Worth Clinically

integrated

network: Over

450 physicians 82 practices

Over 53 miles 4 counties

34 specialties 1/3 employed

1/3 PCP

What is an Accountable Care Organization?

Healthcare providers agree to be accountable for quality,

cost, and overall care of a defined population of patients

Beginning in 2012, Medicare started a number of ACO “pilots” through the Center for

Medicare and Medicaid Innovation (CMMI):

A group of providers or other eligible entities

Attributed traditional Medicare patients

Manage all patients annually

Report on Quality Metrics

Aggregate Quality Score multiplied upon financial benchmark performance

MAP2 Physician Network Development 2011 pre-Medicare Shared Savings participation

Strategy:

Need adequate network to “net” a minimum of 5000 traditional Medicare beneficiaries

May convert to commercial contracts “some day”

Invite all “friends and family”

Attempt to succeed in getting PCPs to join

Leverage prior success in PHO with membership and quality performance

Research and development investment to “learn” a fundamentally different way to deliver healthcare

MAP2 Physician Network Development Challenges:

Unknown panel size of traditional Medicare

patients/physician

Unclear attribution model definition from Medicare

Unclear interest by physicians in market

?hostility towards everything “ACA” in market

Uncertain if would be accepted into MSSP

Medicare Shared Savings Program (MSSP) track 1 with 16,000 attributed beneficiaries July 2012 start

– Year 1: $12.7 million in savings

– Year 2: $12.6 million in savings

– Year 3: $18.8 million in savings

– 1/31/450 MSSPs to achieve shared savings 3 years in a row

4 Commercial Population Health Contracts with additional 54,000 covered lives

Top quartile quality and patient satisfaction performance

Methodist Patient Centered Accountable Care Organization (MPCACO)

– MAP2 (a dba of MPCACO)

Networks

Where to Start?

Premier Population Health Management Collaborative*

AAFP

Claims Data Analysis

Read

Talk

Listen

Narrow the Focus and Prioritize

Engaged high performing physicians

Improved care management

Optimized post-acute care networks

Enhanced utilization of population health

information technology

Managed in-network utilization

Engaged Physicians

Physician-Led Governance

Regular real-time clinical quality performance feedback

Flexible, transparent, simple incentive model

Physician Governance Participation in

MAP2/MPCACO

ACO Governing Board

10 physicians

ACO Operations

President

Clinical Executive

Physician

Team Members:

Operations

Clinical

Governance and Nominating Committee

4 physicians

Responsible for nominating new

board and committee members

Finance Committee

12 physicians

Responsible for approving budget, capital requests,

earned distributions

Clinical Oversight Committee

15 physicians

Responsible for determining basis

for physician shared savings

distribution including quality

measures

Care Coordination Committee

6 physicians

Post-acute reps

Responsible for developing and

monitoring evidence based practices for the care continuum

New committees: IT and Data Governance, Referral Management

Regular Feedback on Quality Metric Performance

Incentive Program Evolution over Time

Performance Year 1 Performance Year 4

Same rules for all providers Process focused “Easier” to qualify Equal payouts Not related to degree of

Medicare participation ?engagement

Points system/menu of options Specialty-specific options Outcomes and participation options Variable payouts Portion reserved for PCPs focused

on improvement in quality scores Related to Medicare participation > engagement

Physician Engagement/Lessons Learned

PY1

PY2

PY3

020

40

60

80

% TotalPhysiciansQualified

% TotalPCPs

Qualified

% TotalSpecialistsQualified

PY1

PY2

PY3

Improved Care Management

Risk Stratification and

Navigation Resource

Matching

Population Health Management: Nurse Navigation

Level 6-1% to 3%

Level 5-5% to 7%

Level 3 and 4-40% to 50%

Levels 1 and 2 -The Rest

Risk

Group

>400

Active Patient Panel

13,400

Inpatient/ER census

Crimson risk scores

Physician referrals

Case management

referrals

Individual assessments

PAM score

The rest of the cost

More than 50% of the cost

Why Do Risk Stratified Care Management (RSCM)?

All patients do not need the same amount of help and support

Systems and standardized approaches can be designed which are most

appropriate for the patient’s needs

High risk patients are the ones who are most likely to benefit from intense

care management

High risk patients tend to generate the highest costs for the system and

therefore provide the most opportunity for cost savings

The practice can use valuable time and effort on the patients most likely

to benefit from intense care management

Pro-active care management and tracking of high risk patients keeps them

from “falling through the cracks” or getting lost in the system

Patient Benefits: Case Study

“What the MPCACO beneficiary care navigators did for me was to help me be able to return home confidently by myself after a prolonged hospital stay. I don’t think I would have been able to do that without them.” JUDITH JORDAN | PATIENT

Optimized Post-Acute Care

Networks

Post Acute Quality

Provider Network

Areas for financial focus in MSSP—Start with Data!!!

Expense for MPCACO Assigned Beneficiaries CY13

All MSSP ACOs Impact of 5% Cost Reduction

Impact of Reaching MSSP Average

Total $10,735 $9,824 $6,803,843 $11,547,836

Inpatient $3,390 $3,200 $2,148,582 $2,408,440

Home Health $1,250 $515 $792,250 $9,316,860

Year 1 Benchmark was $12,094 Home health alone could generate over 3x the savings as compared to inpatient expenses

NOTE: Costs not severity adjusted

Skilled Nursing Facility and Home Health Initiatives

Quarterly meetings

Collaborative discussions

Data review and discussions

Quality, utilization, and financial

Quality measures

Lists published 2 x year

Measures evaluated annually

Distribution to stakeholders

Monthly score card survey

Post Acute Liaison

Pilot projects

LACE readmission reduction

24 hour medication delivery

Sepsis early recognition readmission reduction

CHF continuum pathways

Physician Payment 2017 and beyond

MACRA legislation was passed with

bipartisan support by Congress and

signed by the President in 2015.

The first performance period began

January 1, 2017

MACRA Timeline 2017 2018 2019 2020 2021 2022-2024 2025 2026

Medicare Part B Baseline Payment Updates

+0.5% +0.5% +0.5% 0% 0% 0% +0.25%*

+0.75%**

*Non-qualifying AAPM Conversion Factor

**Qualifying AAPM Conversion Factor

Merit-Based Incentive Payment System (MIPS)

PQRS, Value-based

Modifier, & Meaningful Use Quality, Cost, Advancing Care Information, & Improvement Activities

-9% -9%? 0 or +/-4%* “Pick Your Pace”

+/-5% +/-7%

Qualifying AAPM Participant

5% Incentive payment

Excluded from MIPS

+0%

+/-9%

MIPS APM

(MIPS) APM Scoring Standard

*CMS will calculate

the final score for

MIPS APM at the

APM Entity level.

Quality

• Measures report through APM

Cost

• 0% Indefinitely

ACI

• Must report (same requirements as MIPS ECs)

Improvement Activities

• Automatic 100% (annual review of model)

What differentiates the CMMI programs?

MSSP track 1 MSSP track 1+ MSSP track 2 MSSP track 3 NextGen ACO

Retrospective patient attribution Prospective patient attribution

Minimum Sharing rate/Final sharing rate/Performance Payment Limit

Minimum Loss rate/Shared Loss rate/Loss sharing limit

One-sided financial risk 2 sided-financial risk

Pick Your Pace in 2017 Practices can “Pick Your Pace” from four options:

• Test – Submit data for one quality measure, OR one improvement activity, OR the four required ACI measures and avoid a negative payment adjustment..

• Partial Participation – Submit at least 90 days of data for more than one quality measure, OR more than one improvement activity, OR more than the four required ACI measures and avoid a negative payment adjustment. Partial participation also allows you to possibly receive a small positive payment adjustment.

• Full Participation – Submit at least 90 days of data for all required quality measures, AND all required improvement activities, AND all four required ACI measures to avoid a negative payment adjustment. Full participation also allows you to possibly receive a moderate positive payment adjustment.

• Advanced APM – You will receive a 5% bonus if you receive 25% of Medicare Part B payments, OR see 20% of patients through the AAPM.

• Important Note: Failure to report even one measure or activity in 2017 will result in a negative 4% adjustment in Medicare payments in 2019.

Am I ready? Recommendations

1) Start with one-sided plan, shared-savings,

care management fee, etc only

2) Build network and infrastructure around this plan as research and development

3) Perform assessment of network/group readiness for risk

4) Draw strategic plan with gap analysis and timeline around assessment to move to risk

Resources www.aafp.org/aco

http://www.aafp.org/practice-management/payment/risk.mem.html

http://www.aafp.org/practice-management/payment/macraready.html

http://www.naacos.com/

http://www.aafp.org/practice-management/payment/macraready.html

https://qpp.cms.gov/

https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/index.html

Resources (cont.)

For questions and feedback contact:

Karen Breitkreutz, RN BSN, Delivery

System Strategist, kbreitkreutz@aafp.org

Questions?