1. Rural Networks in the Post Reform Environment 2016 MHA Health Summit March 17, 2016 Sue Deitz, MPH Regional Vice President National Rural Accountable Care Consortium The project described was supported by Funding Opportunity Number CMS-1L1-15-003 from the U.S. Department of Health & Human Services, Centers for Medicare & Medicaid Services. Its contents are solely the responsibility of the authors and do not necessarily represent the official views of HHS or its agencies.

2. Outline of today’s presentation  Current environment - MACRA  Value based payment – how is tied to quality  Types of Rural Networks  Opportunities, leverage and collaborate

3. Per Capita Total Current Health Care Expenditures, U.S. and Selected Countries, 2010

4. SOURCE: Congressional Budget Office (CBO) Medicare Baseline, May 2013. Projected Medicare Spending, 2013-2023 In billions:

5. SOURCE: 2013 Annual Report of the Boards of Trustees of the Federal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds. Medicare Part A Trust Fund Balance at Beginning of the Year, as a Percentage of Annual Expenditures, 2012-2026 In billions:

6. Two-Thirds of Medicare Spending Is for People With Five or More Chronic Conditions Percentage of Medicare Expenditures 99% of Medicare expenditures are for beneficiaries with at least one chronic condition. 98% of Medicare expenditures involve individuals with multiple chronic conditions. Source: Medicare Standard Analytic File, 2007

7. The Speed of Change is Increasing www.nationalruralaco.com Proprietary & Confidential, Not for Distribution 43 Secretary Burwell’s historic announcement “Our first goal is for 30% of all Medicare provider payments to be in alternative payment models that are tied to how well providers care for their patients, instead of how much care they provide – and to do it by 2016. Our goal would then be to get to 50% by 2018. Our second goal is for virtually all Medicare fee-for-service payments to be tied to quality and value; at least 85% in 2016 and 90% in 2018.” Only 36 percent of the 1,201,363 professionals who were eligible to participate in 2012 participated in PQRS, so how is that going to happen?

9. How Will the Secretary Achieve Her Goal? MSSP BPCI PCMH www.nationalruralaco.com Proprietary & Confidential, Not for Distribution 9 Readmissions MU PQRS MIPS CCJR

10. MACRA: 2019 – 2025 (AKA “Doc Fix”) www.nationalruralaco.com Proprietary & Confidential, Not for Distribution 10 Medicare and CHIP Reauthorization Act of 2015. Increased federal deficit by $141 billion over next 10yrs. Three key provisions: 1.Sustainable Growth Rate repeal and annual updates 2.Merit based payment system (MIPS) 3. Alternative Payment Models (APMs)

12. Measurement year 2017-2018. Benchmark set in 2019. July 2017 – CMS provides feedback on scores July 2018 – CMS provides Claims data Set benchmark in 2019 Below – Penalty Above - Bonus Score 1-100 Certified PCMH highest potential score for the CPIA category

13. Quality Score Tied to Payment

14. No MIPS if in a Qualified APM (e.g ACO) www.nationalruralaco.com Proprietary & Confidential, Not for Distribution 14

15. Top 5% 6-10% 11-25% 26-50% 51-100% $15,320 $35,986 $84,293 $4,381 $743 Focus Care Coordination on “Top 10%” Patients to Achieve Savings Care Coordination Wellness Promotion } {

16. What is an ACO? Providers agree to be accountable for the cost and quality of care of their primary care patients, helping them get the best care at the lowest cost, everywhere they go. If quality is good, and costs go down, providers can get up to 50% of the savings. If costs go up, there is no penalty. This is strictly a bonus program. All existing reimbursement stays the same. Participants receive powerful data and waivers that help them help their patients get better care at a lower cost. 16

17. How Does “Shared Savings” Work? ACO’s Baseline Spending per Patient - based on previous 3 years, for all ACO participants ACO’s Year 1 Spending per Patient Shared Savings (50%) Quality Score Adjusted Shared Savings xQ ACO Programs $10,000 $9,500 $500 $250$200 All existing reimbursement stays the same! Saving s

18. At-Risk Populations Preventive Health Patient and Caregiver Experience Care Coordination and Patient Safety Four Quality Domains

19. What is a Clinically Integrated Network? A legal entity formed around a framework of clinical integration that may offer one of more of the following: Source: Becker’s Hospital Review

20. CINs and Rural Strengths I ntegrated delivery networks can provide 70% of needed services. Passionate about serving their community. Deep relationships with their population. Nimble – able to change quickly when they know what to do Fixed population served “cradle to grave”. Excess capacity can be leveraged to work on population health. Increased local volume reduces per capita costs dramatically when cost-based reimbursed. Local brand is typically very strong – most beloved institution in town and major economic driver.

21. Leverage NRACO Program Coordinate care for chronically ill to reduce costs and build market share Provide 24/7 Advice Nurse Hotline to reduce ED primary care Redesign workflow at clinic to address care gaps Conduct Annual Wellness Visits to promote prevention Revisit billing practices and Physician compensation Join forces with other independent providers to qualify for programs and spread costs (CINs) Join forces with strong tertiary systems to provide best value for patients Enroll in ACOs to get data and advance down payment continuum

22. Thank you & Questions? Go to www.nationalruralaco.comwww.nationalruralaco.com Sue Deitz, MPH Northwest Regional Vice President (208) 610-0937 We look forward to working with you! 22