1. J14 NHIC, Corp CAC Meeting The Price of Non-Engagement: When Pay for Performance Programs Develop Penalties Andy Finnegan Health Insurance Specialist Division of Medicare Financial Management

2. Value of Engagement – Combined Physician Quality Reporting/eRx Incentive Program Paid $662,531,035 in incentives 72% increase from 2009 ($384,704,248) – Over 64,000 individual eligible professionals (National Provider Identifiers or NPIs) and almost 13,000 practices (Tax ID Number or TIN) participated in both programs 52% of those individual eligible professionals participating in both programs were incentive eligible in both programs – 125,000 EPs and Hospitals have received more than $4 billion in HITECH incentive payments NHIC J14 CAC

3. Established in 2009, the eRx Incentive Program encourages the use of electronic prescribing by providing incentives and payment adjustments based on whether eligible professionals, or CMS-selected group practices participating in eRx Group Practice Reporting Option (GPRO) meet the criteria for being successful electronic prescribers The applicable eRx incentive amounts are as follows: 2.0 % - 2009, 2.0% - 2010 1.0% - 2011 1.0% - 2012.5% - 2013 The applicable eRx payment adjustment amounts are: 1.0 % - 2012 1.5% - 2013 2.0% - 2014 eRx Payment Incentive Schedule

4. Avoiding the 2013 eRx Payment Adjustment – Individual Eligible Professionals 2013 eRx Payment Adjustment – Overview (cont.) Reporting Period Reporting Mechanism Reporting Criteria 12-month (Jan 1, 2011-Dec 31, 2011)* Claims* Reports on the 2011 electronic prescribing measure’s numerator code at least 25 times for encounters associated with at least 1 of the denominator codes (CMS-1500 type claim form)* 12-month (Jan 1, 2011-Dec 31, 2011)* Qualified Registry* Reports on the 2011 electronic prescribing measure’s numerator code at least 25 times for encounters associated with at least 1 of the denominator codes* 12-month (Jan 1, 2011-Dec 31, 2011)* Qualified EHR* Reports on the 2011 electronic prescribing measure’s numerator code at least 25 times for encounters associated with at least 1 of the denominator codes* 6-month (Jan 1, 2012-Jun 30, 2012) Claims Report the electronic prescribing measure's numerator code at least 10 times on any payable Medicare PFS service eRx

5. 2013 eRx Payment Adjustment Hardship Exemptions 2013 eRx payment adjustment hardship exemption requests, and lack of prescribing privileges, must be submitted on or before June 30, 2012 Unable to electronically prescribe due to local, state, or federal law, or regulation Has or will prescribe fewer than 100 prescriptions during the 6-month reporting period Practices in a rural area without sufficient high-speed Internet access (G8642) Practices in an area without sufficient available pharmacies for electronic prescribing (G8643) Does not have prescribing privileges during the 6-month reporting period (G8644 ) eRx

6. 2010 Data eRx Incentive Program 113,074 participants 65,857 individual eligible professionals/NPIs and 18,713 practices/TINs earned incentive payments totaling $270,895,540 Total incentive payments increased 83% from 2009 ($148,007,816) Average incentive amount was $3,836 per eligible professional/NPI and $14,476 per practice/TIN eRx

7. Physician Quality Reporting System PQRS

8. 2012 Physician Quality Reporting – Individual Measures The 2012 Physician Quality Reporting now consists of 210 quality measures. This includes 28 new measures for claims and registry. Nine measures from the 2011 program were retired for 2012. PQRS

9. 2012 Physician Quality Reporting – Measures Groups For 2012, there are a total of 22 measures groups. Fourteen measures groups were retained from 2011 and 8 new measures groups were added for 2012 PQRS

10. The 6-month reporting period beginning (July 1, 2012 – December 31, 2012) is only available to those eligible professionals reporting measures groups via registry. PQRS

11. Physician Quality Reporting System – Medicare EHR Incentive Pilot For the 2012 program year, CMS implemented the Physician Quality Reporting System-Medicare EHR Incentive Pilot. Successful participation in the pilot will allow receipt of the 2012 Physician Quality Reporting Incentive and demonstrate meaningful use of the clinical quality measure (CQM) component of the EHR Incentive Program. 44 CQMs PQRS

12. 2007 PQRS – 1.5% subject to a cap 2008 PQRS – 1.5% 2009 PQRS – 2.0% 2010 PQRS – 2.0% 2011 PQRS – 1.0% 2012 PQRS – 0.5% 2013 PQRS – 0.5% 2014 PQRS – 0.5% PQRS Incentive Payment Schedule

13. 2015 – 1.5% 2016 - (AND SUBSEQUENT YEARS ), 2 % PQRS Payment Adjustment Schedule

14. 2012 Program Reporting Options 1. Claims-based reporting of individual measures (12 months) 2. Claims-based reporting of at least one measures group for 30 unique Medicare Part B FFS patients (12 months) 3. Claims-based reporting of at least one measures group for 50% or more of applicable Medicare Part B FFS patients of each eligible professional (with a minimum of 15 patients) (12 months) 4. Registry-based reporting of at least 3 individual Physician Quality Reporting measures for 80% or more of applicable Medicare Part B FFS patients of each eligible professional (12 months) 5. Registry-based reporting of at least one measures group for 30 unique Medicare Part B FFS patients (12 months) 6. Registry-based reporting of at least one measures group for 80% or more of applicable Medicare Part B FFS patients of each eligible professional (with a minimum of 15 patients) (12 months) 7. Registry-based reporting of at least one measures group for 80% or more of applicable Medicare Part B FFS patients of each eligible professional (with a minimum of 8 patients) (6 months) 8. Direct EHR-based reporting of at least 3 individual Physician Quality Reporting measures for 80% or more of applicable Medicare Part B FFS patients of each eligible professional (12 months) 9. Direct EHR-based reporting of a total of 3 HITECH core or alternate core measures AND at least 3 additional HITECH measures (12 months) 10. EHR Data Submission Vendor reporting of at least 3 individual Physician Quality Reporting measures for 80% or more of applicable Medicare Part B FFS patients of each eligible professional (12 months) 11. EHR Data Submission Vendor reporting of a total of 3 HITECH core or alternate core measures AND at least 3 additional HITECH measures (12 months) 12. GPRO-based reporting (25-99 eligible professionals) of all applicable measures included in the submission web interface provided by CMS for consecutive, confirmed, and completed patients for each disease module and preventive care measures (12 months) 13. GPRO-based reporting (100+ eligible professionals) of all applicable measures included in the submission web interface provided by CMS for consecutive, confirmed, and completed patients for each disease module and preventive care measures (12 months) PQRS Reporting Options

15. 2010 Data Physician Quality Reporting 244,145 participants (compared to 100,000 in 2007) – 168,843 individual eligible professionals/NPIs, representing 19,232 practices/TINs, earned incentive payments totaling $391,635,495 Total incentive payments increased 65% from 2009 ($236,696,432) – Number of practices/TINs qualified for incentive (19,232) increased 50% from 2009 (12,781) – Average incentive amount $2,157 for individual eligible professionals/NPIs and $20,364 per practice/TIN Compared to $1,962 and $18,519, respectively, in 2009 Participation rate increased from 15% to 24% between 2007-2010 Most common reporting option continued to be individual measures through claims PQRS

16. The Medicare and Medicaid EHR Incentive Programs provide incentive payments to eligible professionals, eligible hospitals and critical access hospitals (CAHs) as they adopt, implement, upgrade or demonstrate meaningful use of certified EHR technology. Eligible professionals can receive up to $44,000 through the Medicare EHR Incentive Program and up to $63,750 through the Medicaid EHR Incentive Program. HITECH

17. More than 120,000 eligible health care professionals and more than 3,300 hospitals have qualified to participate in the program and receive an incentive payment since it began in January 2011. That exceeds a 100,000 goal set earlier this year. Payments exceed $4 Billion. That includes more than half of all eligible hospitals and critical access hospitals and 1 out of every 5 eligible health care professionals. HITECH

18. Incentive Payments for Medicare EPs First Calendar Year (CY) for which the EP Receives an Incentive Payment CY 2011CY 2012CY 2013CY2014CY 2015 and later CY 2011$18,000 CY 2012$12,000$18,000 CY 2013$8,000$12,000$15,000 CY 2014$4,000$8,000$12,000 CY 2015$2,000$4,000$8,000 $0 CY 2016$2,000$4,000 $0 TOTAL$44,000 $39,000$24,000$0 18 Additional 10% Incentive Payment for Medicare EPs Practicing in HPSAs

19. Incentive Payments for Medicaid EPs CY 2011CY 2012CY 2013CY 2014CY 2015CY 2016 CY 2011$21,250 CY 2012$8,500$21,250 CY 2013$8,500 $21,250 CY 2014$8,500 $21,250 CY 2015$8,500 $21,250 CY 2016$8,500 $21,250 CY 2017$8,500 CY 2018$8,500 CY 2019$8,500 CY 2020$8,500 CY 2021$8,500 TOTAL$63,750 19 First Calendar Year (CY) for which the EP Receives an Incentive Payment

20. HITECH Payment Adjustments 2015 – 1% 2016 – 2% 2017 – 3% 2018 – 4% 2019 – 5% 20

21. Cost of Non-Engagement Program20152016201720182019 eRxTBD PQRS1.5%2% HITECH1%2%3%4%5% 2.5%4%5%6%7% 21

22. Lost Revenue Opportunities PQRSeRxEMR Medicare EMR Medicaid 2012.5%1.%$12,000$8,500. 2013.5% $8,000$8,500 2014.5%---- $4,000$8,500 22

23. Medicare Program Integrity 23

24. Medicare Overview Each Work DayMonthlyYearly  5.4 million claims processed  From 1.5 million providers  Worth $1.1 billion  19,000 Part A and Part B provider and 900 durable medical equipment enrollment applications received  Over $497 billion in claims paid  Over 47 million beneficiaries

25. Spectrum of Fraud and Abuse Results in improper payments Targeting causes of improper payments – From honest mistakes to intentional deception 3–10% of health care funds lost due to fraud Errors Waste AbuseFraud

26. When Fraud is Detected Administrative actions imposed include – Auto-denials, payment suspensions, prepayment edits, civil monetary penalties Improper payments must be paid back Providers/companies barred from program – Can’t bill Medicare, Medicaid or CHIP Fines are levied Law enforcement gets involved Arrests and convictions

27.  Prevention Screen providers and suppliers effectively Spot fraudulent practices before claims are paid Detection – Strategic use of tools and techniques to detect fraud, waste and abuse Recovery – Identify and recover overpayments Reporting – Share key information with internal and external stakeholders CMS Fraud and Abuse Strategies 27

28. Prevention  CMS Center for Program Integrity  Consolidates CMS anti-fraud components New authorities from the Affordable Care Act – More rigorous screenings for health care providers – Cross-termination among Federal and state health programs – Temporarily stop enrollment of new category of providers and suppliers – Temporarily stop payments in cases of suspected fraud

29. URLs https://pecos.cms.hhs.gov https://pecos.cms.hhs.gov https://PQRS.cms.gov https://PQRS.cms.gov https://nppes.cms.hhs.gov https://nppes.cms.hhs.gov qnetsupport@sdps.org https://ehrincentives.cms.gov https://ehrincentives.cms.gov www.medicarenhic.com www.medicarenhic.com www.ngsmedicare.com 29

30. NHIC J14 CAC Questions andrew.finnegan@cms.hhs.gov 617-565-1696 30