1. Value-Based Purchasing Region 12 Learning Collaborative
Andy Vasquez, Deputy Associate Commissioner
MCS, Quality & Program Improvement Section
March 24, 2017

2. Value-Based Purchasing & Alternative Payment Models
VBP / APM Concepts
Accountable Care Organizations (Reference)
HHSC APM Initiatives
VBP Keys to Success
Summary
Questions

3. VBP/APM Concepts Goals & Terminology
Goal: Move away from volume-based payment models towards models that link healthcare payments to quality or value
Related terms:
Value-Based Payments (VBP) / Value-Based Contracting (VBC)
Alternative Payment Models (APM)
See Alternative Payment Model Framework from Health Care Payment Learning Action Network (HCP-LAN.org)
Quality-Based Payments
Payment Reform

4. VBP/APM Concepts Good data is very important
Maintaining open communications and transparency in processes/methods is critical
Continuous engagement of stakeholders
Use of effective measures to advance quality and efficiency
Focus on measures that improve quality (and also lower cost)
Must also be clearly understood
Balance of properly scaled incentives and disincentives
Need for a coordinated approach, harmonize where possible

5. VBP/APM Concepts Why Value-Based Purchasing?
Has the potential to more appropriately direct clinical services in the most effective manner
All parties better "internalize" right care in right amount
Linking greater percentages of healthcare payments to value should result in improved outcomes and greater efficiencies over time

6. Accountable Care Organizations
What are they? ACOs are groups of doctors and other health care providers who voluntarily work together to provide high quality, coordinated services at the right time in the right setting.
In Medicaid/CHIP, thus far HHSC has seen a very limited numbers of ACOs
Why? Many of the central features of an ACO create challenges
Generally ACOs involve financial risk
Unclear how much savings can be extracted from Medicaid

7. Accountable Care Organizations
Leadership and operational considerations: Need leaders who can organize groups of providers that are not necessarily clinically or financially aligned toward alignment
Adoption of a population health mindset and possibly an alternative payment model (non fee-for-service) to support population health
Legal / Governance / Contracting
DATA, DATA, DATA: for modeling, assessment of risk, care coordination
Patient attribution and ACO methods for allocating risk/reward

8. Accountable Care Organizations
HHSC has done some limited field research on ACOs: one very large, sophisticated ACO in Houston and one very small ACO in Central and West Texas. Both participate in the Medicare ACO initiative.
Additionally, when HHSC collects information from MCOs on their “inventories” of VBP models (collected annually), we see provider types that have characteristics of ACOs. Our interactions with MCOs will shed more light on these models
For ACOs or ACO-like entities: This journey starts with local champions and a desire to form the necessary collaborative relationships for improved population health management
Good slide deck on ACOs: d/kirschner.pdf
Other suggested reading: accountable-care-organizations-state-update/

9. HHSC APM Initiatives

10. HHSC APM Initiatives Medical Pay for Quality Program
Percentage of MCO capitation is placed at-risk, contingent on performance on targeted measures
The redesigned P4Q program:
Is simpler and easy to understand
Allows plans to track their performance and predict losses, to the degree possible
Rewards high performance and improvement
Promotes transformation and innovation leading to better health outcomes
Understanding what the state requires of its MCOs, may be helpful to providers to understand some of the drivers of MCO behavior.
Model:
4% of MCO capitation is at risk
Must perform well on certain quality measures to retain their full capitation.
Financial aspects of Model are currently on hold while it is being redesigned.
Most plans have implemented one or more APMs with their providers around our P4Q measures.
Example of alignment of goals
Program challenges:
Design and risk/reward scaled to the measures of focus
Expansions of managed care
Measures selection
Data sources/data collection
Knowledge transfer

11. HHSC APM Initiatives Medical Pay for Quality Program
MCO’s will earn or lose money based on three factors:
Performance compared to Benchmarks
Performance compared to Self (prior year)
Bonus Pool (no risk)
Draft Medical P4Q program measures focus on:
Prevention
Chronic Disease Management, including Behavioral Health
Maternal and Infant Health
To be implemented January 2018
Financial Model
A portion of the capitation at-risk will be assigned to each selected quality measure.
The new methodology will allow plans to know upfront how much they could potentially lose based on predetermined benchmarks.
All revenue that is recouped will be redistributed and distributions will not exceed recoupments.

12. HHSC APM Initiatives MCO Value-Based Provider Contracts
Most VBP models based on fee for service fee schedule with add on payments for achievement of metric(s)
HEDIS Measures
Potentially Preventable Events
After Hours Availability
Mostly primary care, some specialist or other facility based providers
Most have “upside” only
Although, there are some partial capitation for primary care / group practices and bundled payment models
MCOs are meeting providers “where they are at”

13. HHSC APM Initiatives New UMCC and UMCM Requirements:
Minimum threshold:
Provider payments in APMs
Provider payments in Risk- Based APMs
4 Year Goals
Exceptions for high quality
Penalties for low performance
Provider data sharing
Measurement period begins January 1, 2018 (aligned with P4Q)
HCP-LAN = Health Care Payment Learning & Action Network
Source: HCP-LAN.org, APM Framework

14. VBP Keys to Success
Challenges to Address

15. VBP Keys to Success Challenges to Address
Clients/Consumers must always come first
Accountability at all levels (patient to payer)
Align financial and clinical models between multiple payers, provider types, and populations
Increase level of VBP readiness and willingness across MCOs and providers
Build in administrative simplification and maintain it
Patient Attribution – identifying which providers have primary responsibility for a patient’s health
Align Models – Medicaid is not the only payer (see next slide)
Increase level of VBP readiness & willingness – Wide range of sophistication and administrative infrastructure between providers and between MCOs.
Patient attribution – identifying patient-provider relationships. Patient attribution forms the basis for measuring performance of physicians and provider groups, reporting data, and paying for patient care

16. VBP Keys to Success Alignment of Clinical & Financial Models
RHP DSRIP Hospital and Other Performing Providers
Quality Measures and Initiatives
Medicaid and CHIP MCO Quality Measures and Initiatives
(P4Q, MCO VBP, PIPs)
Medicaid Fee for Service Programs
Commercial Carriers
Medicare Quality Measures and Initiatives
(ACOs, Hospital Value Based Purchasing, Hospital Readmissions Reduction Program, MACRA)

17. Other Payers (Medicare, Commercial)
VBP/APM Challenges
HHSC
Other Payers (Medicare, Commercial)
VBP “Layers”
HHSC  MCO
MCO  Provider
HHSC  Provider
MCOs
Healthcare Providers
Additionally, non-medical services and supports, which are often critical to improving outcomes and cost effectiveness are often outside of VBP approaches
Healthcare Providers
Healthcare Providers

18. VBP Keys to Success Challenges to Address, continued
Timely, comprehensive data and enhanced analytics
Evolve valuation (rates and risks) and measurement methods
Address challenges of rural providers and small practices
Progress through the APM continuum
This is a complex and long term endeavor that is evolving in a dynamic state, federal, commercial environment – plan accordingly
Data: claims, encounters, medical records must be accurate, sufficiently detailed, accessible, shared
Valuation and Measurement –
Valuation: how much should HHSC or MCOs pay as incentives, episodes of care, for cost sharing, as PMPM (as move away from fee schedules)
Valuation: appropriately crediting and/or paying MCOs and providers for quality improvement costs
Measurement: How to measure progress towards outcomes
Rural and Small providers – VBP tends to work more easily with providers/systems with large patient panels - Texas has many providers with small patient panels
Complex endeavor – the science and methods behind these models are evolving
Other challenges:
Large number of Medicaid MCOs
Investment may be needed

19. VBP and DSRIP
Key Question: How do we sustain these efforts and continue the forward progress on high impact successes?
HHSC is actively working toward aligning MCO quality efforts and the DSRIP program. HHSC is exploring ways that projects with a high impact to Medicaid can become integrated into managed care and working to facilitate collaboration between providers and MCOs
A thoughtful, coordinated and sustained effort is needed
Challenges:
Getting the MCO’s attention - what would help MCOs advance HHSC goals?
Packaging a proposal / Quantifying ROI
Having a sufficient number of Medicaid patients
Adapting to an MCO APM payment structure

20. VBP and DSRIP Can DSRIP Inform and Advance MCO VBP Efforts? Yes!
Projects are based on locally identified problems with flexible interventions-could inform development of an effective VBP models
Broad based provider collaborations have developed under RHP structure-could be leveraged to create a focus on population health
Provider experience with metrics and tracking progress

21. Summary
HHSC and DSHS have numerous VBP initiatives focused on quality and efficiency designed to achieve the Triple Aim
Many VBP models are underway, many are in development. Progress is slow, but this is complicated work and a paradigm shift
The science, tools, and methods are evolving
Big lift-but very doable and this is where healthcare is going
ACOs or ACO-like entities need local champions and local commitment
DSRIP can be a valuable guide for what works and what does not work in VBP

22. Summary – Helpful Links

23. Summary Links at HHS.Texas.Gov: Quality Improvement
1115 Transformation Waiver 
Uniform Hospital Rate Increase Program (UHRIP)
MCO Pay for Quality (P4Q) 
LTC Quality 
QIPP
DSRIP Questions:
Quality Mailbox:
Did not discuss the Uniform Hospital Rate Increase Program, but included the link.

24. Questions?