Implementation of the Affordable Care Act: Opportunities for Collaboration and Partnership Herb K. Schultz Regional Director, DHHS, Region IX California Ambulance Association 2010 Annual Reimbursement Conference October 5, 2010

Priorities of HHS Secretary Kathleen Sebelius Strategic Initiatives Transform Health Care Implement Affordable Care Act Implement the Recovery Act Promote Early Childhood Health and Development Help Americans Achieve and Maintain Healthy Weight Prevent and Reduce Tobacco Use Protect the Health and Safety of Americans in Public Health Emergencies

Priorities of HHS Secretary Kathleen Sebelius Strategic Initiatives Accelerate the Process of Scientific Discovery to Improve Patient Care Implement a 21 st Century Food Safety Program Ensure Program Integrity and Responsible Stewardship

A New Reality “After a year of striving, after a year of debate, after a historic vote, health care reform is no longer an unmet promise. It is the law of the land.” President Barack Obama March 23, 2010

HHS Regional Offices

Office of the Regional Director Role of the Regional Director – Implementation of health care reform is the number one priority in Region IX (Arizona, California, Hawaii, Nevada, American Samoa, Guam, Commonwealth of the Northern Mariana Islands, Republic of the Marshall Islands, Federated States of Micronesia, and Republic of Palau).

Office of the Regional Director Agency Collaboration – Work across regional office and among all regions to: Collaborate and coordinate on issues Troubleshoot potential problems Partner on events and public affairs Educate the public on the benefits of healthcare reform – Healthcare.gov – CuidadodeSalud.gov (Spanish) – Represent & communicate health care policies Work to implement reforms with State, Local, Tribal, and Territorial Officials and Non-Governmental External Stakeholders. – Notification of grants and other funding opportunities.

Inter-Agency Collaboration & Transparency Web Portal – Comprehensive one-stop: Updated with valuable information on an ongoing basis. Community Health Data Initiative (CHDI) Putting Data and Innovation to Work to Help Communities and Consumers Improve Health. Massive collections of data will be made available in accessible formats that allow and encourage the fullest use of data, ensuring greater transparency of programs and greater accountability for results.

Framework of Health Reform Three-legged stool: – Private Market Reforms – Health Insurance Exchanges – Public Program Expansion 32 million more insured people by 2019 (92% of non-elderly population) – 16 million more Americans in Medicaid by 2019 – 29 million Americans covered via new Exchanges (2019)

Implementing Affordable Care Act: Quickly, Carefully and Efficiently Distributing regulations and guidance Working with States & Insurance Commissioners – Medicaid – Insurance Oversight/Accountability (premium review and medical loss ratio standards) – Transitional high risk pools Establishing Infrastructure for New Functions – Office of Consumer Information & Insurance Oversight – Advisory Commissions & Boards – Communicating what reform means

Containing Costs and Improving Quality: Now/Future CMS Center for Innovation Accountable Care Organizations (ACOs) Bundling payments Incentives for better quality Independent Payment Advisory Board (IPAD) Reducing avoidable hospital readmissions Never events Administrative simplification for federal, state and private plans Driving down waste, fraud and abuse in Medicare and Medicaid

Center for Medicare & Medicaid Innovation To support the ongoing development of new models of payment and delivery. The new law invests $10 billion in this Center over the next 10 years to test payment and delivery innovations that can improve the quality of care and/or increase cost efficiency, identifying successes that could be expanded by the Secretary of Health and Human Services (either regionally or nationally). These funds will produce returns on investment and reduce Medicare spending over the long-term.

Accountable Care Organizations (ACOs) What is an ACO? – ACO is an organization of health care providers that agrees to be accountable for the quality, cost, and overall care of Medicare beneficiaries who are enrolled in the traditional fee-for-service program. – CMS plans to begin the program by January 1, Who can be an ACO? – The statue specifies the following: Physicians and other professionals in group practices and or networks of practices; Partnerships or joint venture arrangements between hospitals and physicians/professionals; Hospitals employing physicians/professionals; and Other forms that the Secretary may determine appropriate.

Accountable Care Organizations (ACOs) Quality Standards – Quality measures will be created in the areas of: Clinical processes Outcomes of care Patient experience Utilization (amounts and rates) of services – The standards will be promulgated with the ACO regulations.

Bundling Payments Medicare Program Establish a national Medicare pilot program to develop and evaluate paying a bundled payment for: – Acute, inpatient hospital services – Physician services – Outpatient hospital services, and – Post-acute care services Create the Independence at Home demonstration program to share savings amongst participating teams of health professionals.

Bundling Payments Medicaid Program Create new demonstration projects in Medicaid to: – Pay bundled payments for episodes of care that include hospitalizations; – Make global capitated payments to safety net hospital systems; – Allow pediatric medical providers organized as ACOs share in cost-savings; and – Provide Medicaid payments to institutions of mental disease for adult enrollees who require stabilization of an emergency condition.

Emphasis on Quality Implementation Timeline in 2010 Strengthening the Quality Infrastructure – HHS to develop a national quality strategy that will support quality measure development and endorsement for the Medicare, Medicaid and CHIP quality improvement programs. Improvements to the Physician Quality Reporting Initiative – Extends through 2014 payments under the PQRI program which provides incentives to physicians who report quality data to Medicare.

Emphasis on Quality Implementation Timeline in 2010 Amendments to Public Health Service Act – Ensuring Quality of Care – Requires the Secretary to develop guidelines for use by health insurers to report information on initiatives and programs that improve health outcomes through the use of care coordination and chronic disease management, prevent hospital readmissions and improve patient safety, and promote wellness and health.

Emphasis on Quality Implementation Timeline in 2011 Establishes the Community-based Collaborative Network Program – Supports consortiums of health care providers to coordinate and integrate health care services, for low- income uninsured and underinsured populations.

Emphasis on Quality Implementation Timeline in 2012 Linking Payment to Quality Outcomes – Establishes a hospital value-based purchasing program to incentivize enhanced quality outcomes for acute care hospitals. – Requires the Secretary to submit a plan to Congress by 2012 on how to move home health and nursing home providers into a value-based purchasing payment system.

Emphasis on Quality Implementation Timeline in 2013 Increasing Access to Affordable Care – Increases Medicaid payments for primary care services. – Additional funding for the Children’s Health Insurance Program (CHIP). – Expanding Medicare authority to bundle payments.

Emphasis on Quality Implementation Timeline in 2014 Quality Reporting for Certain Providers – Places certain providers – including ambulatory surgical centers, long-term care providers, inpatient rehabilitation facilities, inpatient psychiatric facilities, PPS-exempt cancer hospitals and hospice providers – on a path toward value-based purchasing. – Requires the Secretary to implement quality measure reporting programs in these areas. – Requires the Secretary to pilot test value-based purchasing for each of these providers in subsequent years.

Emphasis on Quality Implementation Timeline in 2015 Paying Physicians Based on Value Not Volume – Creates a physician value-based payment program to promote increased quality of care for Medicare beneficiaries.

Investing in Our Nation’s Health Care Workforce Invests in the National Health Service Corps. Reauthorizes and improves scholarship and loan repayment programs. Increases workforce diversity. Develops workforce planning and analysis. Invests $320 million in primary care and incentivizes primary care and practice in underserved areas.

A New Focus on Education and Worker Training Increasing access to providers in underserved areas. Focus on career training. Expanding tax benefits to health professionals working in underserved areas. Building primary care capacity through Medicare and Medicaid. Providing financial assistance for students. Making health care education more accessible.

Immediate Benefits for California 503,000 small businesses in California can be helped by the new small business tax credit. 382,000 Medicare beneficiaries in California that hit the donut hole, or gap in Medicare Part D coverage, will receive or have received the $250 rebate check. 430,000 people from California retired before they were eligible for Medicare that could now be covered by the Early Retiree Reinsurance Program. 19 million residents in California with private insurance will no longer have lifetime coverage limits. 196,000 individuals in California can now have quality affordable coverage through their parent’s insurance policy. $761 million federal dollars are available to California to provide coverage for uninsured residents with pre-existing medical conditions.

Contact Information Herb K. Schultz Regional Director, Region IX U.S. Department of Health & Human Services 90 Seventh Street, Suite San Francisco, CA (415) – Main Number (415) – Direct Number (415) – Cell Phone HHS Website: