1. Healthcare Quality Strategies, Inc. | Accelerating healthcare quality improvement Navigating the Healthcare Waters Ahead Are Life Preservers Needed? October 23 and 27, 2015 Carolyn Hoitela, MLS Director, Practice Integration

2. Accelerating healthcare quality improvement Objectives  Healthcare changes today and beyond –What is Medicare Access and CHIP Reauthorization Act (MACRA)?  Title I – Medicare Provider Payment Modernization  Medicare-based Incentive Payment System (MIPS)  Alternate Payment Models (APMs)  What are the current reporting programs? –What do they mean and the impact?  Physician Quality Reporting System (PQRS)  Electronic Health Record Reporting (EHR) Incentive Program or Meaningful Use (MU)  The Value-based Payment-Modifier (VM)  Preparing for Change 1

3. Accelerating healthcare quality improvement Healthcare Changes Today and Beyond  Affordable Care Act, 2010  Driving force behind: –Health insurance reform (beneficiary/patient)  Providing access to affordable and adequate health insurance –Healthcare payment and delivery system reform (provider/facility)  Improving quality and reducing costs in Medicare and Medicaid programs 2

4. Accelerating healthcare quality improvement Healthcare Changes Today and Beyond (cont’d)  CMS Quality Strategy is to optimize health outcomes by leading clinical quality improvement and health system transformation –Builds upon the three National Quality Strategy Goals and applies six priorities  Uses the Triple Aim as a unifying strategy –Better Care –Healthier People –Smarter Spending 3

5. Accelerating healthcare quality improvement Healthcare Changes Today and Beyond (cont’d)  Six priorities: 1.Make care safer by reducing harm caused while care is delivered 2.Strengthen person and family engagement as partners in their care 3.Promote effective communication and coordination of care 4.Promote effective prevention and treatment of chronic disease 5.Work with communities to help people live healthily 6.Make care affordable 4

6. Accelerating healthcare quality improvement Healthcare Changes Today and Beyond (cont’d)  Develop innovations to: –Contain costs through payment reform –Improve quality  Historic shift from fee-for-service to value-based reimbursement  3 current programs that reward quality and efficiency  PQRS  MU Incentive Program  VM  Impact of programs vary depending upon participation –Providers who do not meet reporting requirements or elect not to report/participate incur penalties 5

7. Accelerating healthcare quality improvement Healthcare Changes Today and Beyond (cont’d)  2019 CMS rolling out a new program –Medicare-based Incentive Payment System (MIPS)  Replaces all existing programs –PQRS, VM and MU Incentive –Incorporate all the same concepts into one program  Potential for one reporting deadline under the new system  Introduces Performance Assessment  Higher financial stakes  Greater penalties for not meeting performance  Public Reporting and transparency 6

8. Accelerating healthcare quality improvement Current Programs Penalties  Failure to meet reporting requirements for: –PQRS quality measures  Includes the 2 percent penalty; no incentives –MU requirements  3 percent, increasing to 5 percent penalty in 2019  Limited incentives still available  All programs do a two year look back from the penalty year –Penalties for not reporting in 2015 will be applied in 2017; for 2016 applied in 2018, etc.  The payment implications associated with the current incentive program penalties close at the end of 2018 7

9. Accelerating healthcare quality improvement 8  Medicare Provider Payment Modernization  MIPS  APMs

10. Accelerating healthcare quality improvement MACRA : Title I Background  Medicare Access and CHIP Reauthorization Act (MACRA) signed into law April 16, 2010  Permanently Repeals the Sustainable Growth Rate (SGR) formula –Enacted under the Balanced Budget Act of 1997 –Used to set annual updates to Medicare payments under the Physician Fee Schedule (PFS) –Linked to Medicare annual payment adjustments for physician services to the Gross Domestic Product growth  Averted the 21 percent reduction to Medicare in 2015 9

11. Accelerating healthcare quality improvement MACRA Annual Updates 10 Calendar YearAnnual Updates 20150.5 percent update effective June 1, 2015 2016-2019 0.5 percent annual updates Effective 7/1/2015 through 12/31/2018 2020-2025No updates/increases, frozen at 2019 level 2026+ 0.75 percent annual updates for providers participating in APMs, that meet certain criteria 0.25 percent annual updates for all others

12. Accelerating healthcare quality improvement Two New Payment Models  MIPS consolidates aspects of: –PQRS, VM and MU Incentive Program –Becomes the only Medicare quality reporting program  APMs –Incentive payments for certain Eligible Professionals (EPs) who participate in a “qualified model”  Accountable Care Organizations (ACOs), Center for Medicare and Medicaid Innovation (CMMI) models etc.  Encourages the creation of Physician-focused payment model (PFPM) –Not yet completely developed 11

13. Accelerating healthcare quality improvement MIPS  Consolidates existing Medicare quality reporting programs –Single, unified physician value-based reporting that adjusts payments based on a composite performance score, 0-100  May lead to a simplified sharing of information/reporting –CMS has RFIs and workgroups to establish this  In 2019 payments will be adjusted based on performance –Based on 2017 reporting - Logical  Applies to Eligible Professionals = physicians and non- physicians who do not participate in APMs 12

14. Accelerating healthcare quality improvement MIPS Composite Score 13

15. Accelerating healthcare quality improvement MIPS Composite Score (cont’d) 14  Quality Measures –Drawn from PQRS, VM, MU; and those from qualified clinical data registries  Resource Use –Engage physicians to ensure accurate resource use assessments  Meaningful Use –Meeting current years MU requirements  Clinical Practice Improvement Activities –Brand new measure to VBP –Looks at expanded practice activities

16. Accelerating healthcare quality improvement MIPS Composite Performance Score 15  CMS to provide EPs with regular, timely feedback reports regarding performance  By 7/1/2017 receive quarterly reports on performance –These will replace the current Quality Resource and Use Reports (QRURs)  By 7/1/2018 receive patient claims data report –Look at resource allocation of patients

17. Accelerating healthcare quality improvement MIPS Adjustment/Bonuses 16  Based on composite performance score EPs may receive an upward, downward or no payment adjustment  Exceptional Performers see significant opportunities for additional bonuses/adjustments on top of traditional MIPS incentives –Available in 2019 through 2024

18. Accelerating healthcare quality improvement APMs  Provides incentives and pathway for physicians to develop and participate in new models of healthcare delivery and payment  Medicare APMs are defined as: –Those that involve risk of financial losses and a quality measure component (e.g., the Medicare Shared Savings Program) –A model under the CMMI –A demonstration under section 1866C of the SSA  The Health Care Quality Demonstration Program that examines the extent to which financial incentives promote improvements in care –A demonstration required by federal law 17

19. Accelerating healthcare quality improvement APMs (cont’d)  Provides 5 percent incentive payments from 2019 to 2023 for those who join new models  Participants need to receive at least 25 percent of their Medicare revenue through an APM in 2019 to 2020. –Threshold increases over time –Incentivizes participation in private-payer APMs  EPs only be subject to the quality reporting requirements for their APM –Exempt from the new MIPS quality program 18

20. Accelerating healthcare quality improvement MACRA Resources 19  CMS Innovation Center –http://innovation.cms.gov/  MACRA –https://www.cms.gov/Medicare/Quality-Initiatives-Patient- Assessment-Instruments/Value-Based-Programs/MACRA-MIPS- and-APMs/MACRA-MIPS-and-APMs.html –http://www.aafp.org/practice-management/payment/medicare- payment/faq.html –http://waysandmeans.house.gov/UploadedFiles/HR_1470_Sectio n_by_Section.pdf

21. Accelerating healthcare quality improvement 20  Current reporting programs –What do they mean and impact?  PQRS  MU  VM

22. Accelerating healthcare quality improvement PQRS History  Formerly known as Physician Quality Reporting Initiative (PQRI) –First efforts at measuring and rewarding quality  Began in 2007 with 74 available measures and a potential incentive of 1.5% of allowed Medicare payments  Today PQRS has morphed into 255 individual measures and 22 measure groups  Penalties for non or unsuccessful reporters began in program year 2013 –1.5 percent payment penalty and 2 percent thereafter  Pathway for VM 21

23. Accelerating healthcare quality improvement PQRS Current Reporting Requirements 22  Nine or more measures covering at least three NQS clinical domains  Patient Safety; Effective Clinical Care; Person and Caregiver- Centered Experience and Outcomes; Community/Population Health; Communication and Care Coordination; Efficiency and Cost Reduction  At least one Cross-Cutting Measure –Covers multiple domains  Calendar Year reporting period  All payors not just Medicare  All measures must have a performance rate greater than zero  You cannot report measures without a performance rate

24. Accelerating healthcare quality improvement PQRS (cont’d)  Factors to consider when selecting quality measures: –Clinical conditions usually treated –Types of care typically provided and relevant to the practice  E.g., preventive care, chronic care, resource utilization etc. –Quality improvement goals for the practice –Other quality reporting programs providers are participating in –Current office policies and strategies  Can you implement and monitor protocol changes 23

25. Accelerating healthcare quality improvement How to Report PQRS?  Reporting options depending upon practice type/size 24 Individual EPsPQRS Group Practices EHR direct product that is Certified Electronic Health Record Technology (CEHRT) GPRO Web Interface (25+ providers) EHR data submission vendor (DSV) that is CEHRT Qualified PQRS registry (2+ providers) Qualified PQRS registry Submission/Measures Group EHR direct product that is CEHRT (2+ providers) Qualified Clinical Data Registry (QCDR) EHR data submission vendor that is CEHRT (2+ providers) Medicare Part B claims submitted to CMS; submit Quality Data Codes (QDCs) CAHPS for PQRS using CMS-certified survey vendor (2+ providers) - CAHPS is supplemental to other reporting mechanisms

26. Accelerating healthcare quality improvement PQRS Helpful Resources  CMS Main website –https://www.cms.gov/Medicare/Quality-Initiatives-Patient- Assessment-Instruments/PQRS/index.html  Measure Codes –https://www.cms.gov/Medicare/Quality-Initiatives-Patient- Assessment-Instruments/PQRS/MeasuresCodes.html  Payment Adjustment Information –https://www.cms.gov/Medicare/Quality-Initiatives-Patient- Assessment-Instruments/PQRS/Payment-Adjustment- Information.html  How to Obtain your QRUR –http://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/PhysicianFeedbackProgram/Obtain-2013-QRUR.html 25

27. Accelerating healthcare quality improvement History of the MU Incentive Program  In 2009 President Obama stated –“All Americans should have access to an EHR by 2014.”  The Health Information Technology for Economic and Clinical Health (HITECH) Act – February 2009 – The Office of the National Coordinator for Health Information Technology (ONC) –62 Regional Extension Centers (RECs) formed 26

28. Accelerating healthcare quality improvement MU Incentives and Penalties  Incentives offered by Medicare from 2011-2016 –Medicaid 2011-2021  Penalties imposed this year and will continue annually until implementation of MIPS –MU will make up 25 percent of the 100 point MIPS score –2017 will probably be the first performance year  If you have missed a MU reporting year you will be imposed a penalty 27

29. Accelerating healthcare quality improvement MU Final Rule  Published 10/16/2015  Requirements for 2015-2017 are final –Stage 3 will not be finalized until early 2016  Final Rule link: –https://s3.amazonaws.com/public- inspection.federalregister.gov/2015-25595.pdf  Goal of MU is to: –Continue to support advanced use of health IT to improve outcomes for patients  Promotes improved patient outcomes and health information exchange 28

30. Accelerating healthcare quality improvement MU Final Rule (cont’d) 29 MeasuresPages 193 - 204 134 - 148 148 - 164 164 - 179 179 - 193 134 - 140 204 - 214 214 - 234 234 - 243 243 - 273

31. Accelerating healthcare quality improvement MU 2015 Reporting Period and Stages  90 consecutive day reporting period for everyone –Can be any continuous 90-days as long as all the reporting criteria is met  Previous “Stage 1” and “Stage 2” requirements eliminated –One set of measures for all stages  10 objectives required for everyone –Removed the core and menu structure  Clinical Quality Measures (CQMs) did not change –9 measures across 3 clinical domains –Non-zero denominators  Additional exclusions available for EPs in their 1st or 2nd year of participation 30

32. Accelerating healthcare quality improvement MU Objectives For EPs that began participation in 2011, 2012 or 2013 1.Protect PHI  Conduct or review a security risk analysis, address security and encryption of ePHI, implement security updates as necessary, and correct identified security deficiencies 2.Clinical Decision Support (CDS)  5 rules relative to 4 or more CQMs  Enable drug-drug and drug-allergy interaction 3.Computerized Provider Order Entry (CPOE)  More than 60% Medication order  More than 30% Radiology orders  More than 30% Laboratory orders 31

33. Accelerating healthcare quality improvement MU Objectives (cont’d) For EPs that began participation in 2011, 2012 or 2013 4.Electronic Prescribing (eRx)  More than 50 percent of permissible prescriptions written by the EP are queried for a drug formulary AND transmitted electronically 5.Health Information Exchange (HIE)  Any EP who refers a patient to another provider or transitions a patient to another setting must: Use CEHRT to create a Summary of Care record, and  Electronically transmit the Summary of Care record to a receiving provider for more than 10 percent of referrals and transitions of c are  CMS is aware that many EPs do not have DIRECT e-mail addresses but did not lower threshold 32

34. Accelerating healthcare quality improvement MU Objectives (cont’d) For EPs that began participation in 2011, 2012 or 2013 6.Patient Education  More than 10 percent of all unique patients seen by the EP during the EHR reporting period are given patient specific education resources that were identified by CEHRT 7.Medication Reconciliation  The EP performs medication reconciliation for more than 50 percent of transitions of care in which the patient is transitioned into the care of the EP 8.Patient Electronic Access  More than 50 percent of all unique patients seen by the EP during the EHR reporting period are provided timely access to view online, download, and transmit to a third party their health information subject to the EP's discretion to withhold certain information 33

35. Accelerating healthcare quality improvement MU Objectives (cont’d) For EPs that began participation in 2011, 2012 or 2013 8.Patient Electronic Access  Measure 1: More than 50 percent of all unique patients seen by the EP during the EHR reporting period are provided timely access to view online, download, and transmit to a third party their health information subject to the EP's discretion to withhold certain information  Measure 2: At least 1 patient seen by the EP during the EHR reporting period (or patient-authorized representative) views, downloads, or transmits his/her health information to a third party during the EHR reporting period 34

36. Accelerating healthcare quality improvement MU Objectives (cont’d) 9.Secure Messaging  The capability for an EP and patient to send and receive a secure electronic message must be fully enabled during the EHR reporting period  Measure is focused on EP action, rather than patient-initiated action 10.Public Health Reporting  The EP must be in active engagement with a public health agency or clinical data registry to submit electronic data from CEHRT  Active engagement includes:  Option 1 - Completed registration to submit data  Option 2 - Testing and validation  Option 3 - Production 35

37. Accelerating healthcare quality improvement MU Objectives (cont’d) 10.Public Health Reporting  EP must meet 2 of the 3 measures in 2015  3 measure choices  Option 1 – Immunization registry reporting  Option 2 – Syndromic surveillance reporting  Option 3 – Specialized registry reporting  Registries and vendors will charge fees  CMS will not accept cost as a reason for not participating or meeting the measure  Some EHR vendors are contracting with a third party to offer national registries at reduced costs 36

38. Accelerating healthcare quality improvement MU Incentive Resources  EHR Incentive Website –https://www.cms.gov/Regulations-and- Guidance/Legislation/EHRIncentivePrograms/2015ProgramRequireme nts.html –https://www.cms.gov/Regulations-and- Guidance/Legislation/EHRIncentivePrograms/EducationalMaterials.html 37

39. Accelerating healthcare quality improvement What is the Value-based Payment Modifier (VM)?  The VM program competitively rates Medicare Part B professionals on quality and cost measures –Determines upward or downward payment adjustments to Part B reimbursements –Part A hospital and Part C Medicare Advantage payments are not impacted by VM  VM is budget-neutral (must be each year) –The national incentive pool equals the size of the penalty pool –Redistribute downward adjustments from low performing Tax Identification Numbers (TINs) to the higher performing TINs 38

40. Accelerating healthcare quality improvement What is the VM? (cont’d)  VM quality and cost performance are determined on a group- by-group basis –Tied to each provider group’s TIN  VM Quality and Cost Scores are based upon: –PQRS quality measures submitted by each provider group  Group practice reporting option (GPRO) or individual professionals belonging to the provider group, and; –Claims-based quality and cost measures  Utilizing both Medicare Part A and Part B services for Medicare beneficiaries attributed to the provider group 39

41. Accelerating healthcare quality improvement What is the VM? (cont’d)  Part B payment adjustment for performance year 2015 – For provider groups with at least 10 EPs = - 4% penalty to a +4% incentive – For groups and solo practitioners with less than 10 EPs = +/-2%  Payment Adjustments are applied to Part B payments – 2 nd calendar year after reporting period  Quality and cost scores for the 2015 performance year lead to adjustments in 2017 40

42. Accelerating healthcare quality improvement What is the VM? (cont’d)  Performance-year scorecard  Quality and Resource Use Report (QRUR) –Provided for each Medicare-enrolled Taxpayer Identification Number (TIN) –Available in the Fall of the year after that performance year –Must request access via Enterprise Identity Management System (EIDM) through: https://portal.cms.gov –For information on setting up an EIDM account and accessing QRURs :  https://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/PhysicianFeedbackProgram/Obtain-2013-QRUR.html 41

43. Accelerating healthcare quality improvement What is the VM? (cont’d)  The quality measurement component of the Value Modifier includes three outcome measures calculated from Fee-for- service (FFS) claims: –Two composite measures of hospital admissions for ambulatory care-sensitive conditions  acute conditions  chronic conditions  One measure of 30-day all-cause hospital readmissions 42

44. Accelerating healthcare quality improvement What is the VM? (cont’d)  Groups of 100 or more EPs –VM applied in CY 2015 based on performance in CY 2013  -1.0% VM payment adjustment in CY 2015 for non reporters  In CY 2016 quality-tiering is mandatory for groups subject to the Value Modifier in CY 2016  Subject to upward, neutral, or downward adjustment under quality-tiering  Groups with 10 or more EPs –VM applied in CY 2016 based on performance in CY 2014  -2.0% VM payment adjust in CY 2016 for non reporters  Subject to only upward or neutral adjustment under quality-tiering in 2016  Solo practitioners and groups of 2 or more EPs –VM applied in CY 2017 based on CY 2015 performance 43

45. Accelerating healthcare quality improvement What is the VM? (cont’d)  For Medicare Shared Savings Program (MSSP), Pioneer ACO Model, or Comprehensive Primary Care Initiative (CPCI) participating physicians for: –2015 and 2016, the Value Modifier does not apply to during 2013 and 2014, respectively. –2017, the Value Modifier applies  For 2018, the Value Modifier also applies to Medicare Physician Fee Schedule (PFS) payments made to non- physician EPs 44

46. Accelerating healthcare quality improvement VM Resources  CMS VM Website –https://www.cms.gov/medicare/medicare-fee-for-service- payment/physicianfeedbackprogram/valuebasedpaymentmodifier.html#What is the Value-Based Payment Modifier (Value Modifier))  VM Timeline –https://www.cms.gov/Medicare/Medicare-Fee-for-Service- Payment/PhysicianFeedbackProgram/Timeline.html  Frequently Asked Questions (FAQs) –https://questions.cms.gov 45

47. Accelerating healthcare quality improvement 46  Preparing for Change  Public Reporting

48. Accelerating healthcare quality improvement Preparing for Change  If you haven’t reported data on quality measures through the PQRS or as part of meaningful use, start as soon as possible –2015 is a critical year –Penalties for not reporting (PQRS) or for low quality (VM) –Select measures that meet your practices specialty, those that make sense for you to look at quality  If you reported PQRS measures last year –Access your Quality and Resource Use Report (QRUR)  Helps you understand your performance in terms of cost and quality  Good tool to help you prioritize potential areas for improvement  Basis for the Performance and Composite Scores  Take a look at how you scored and what is reported  Look for improvement areas 47

49. Accelerating healthcare quality improvement Strategic Value  Clinical, reputational, and financial stakes –Component of your strategic plan should focus on value and quality  Practice quality program goals should include: –Avoiding Medicare payment adjustments  Negative impact on Medicare reimbursement  Public reporting – negative or positive –The establishment of operational processes which align with reporting of quality patient care  Measures relative to practice –Alignment with providers and facilities that are also strategically focused on quality care and value benefits for patients  Care Coordination, Transitions of Care 48

50. Accelerating healthcare quality improvement Reputational Impact  The “court of public perception” weighs in  Physician Compare website –Late 2015 a subset of 2014 PQRS measures will be reported –For the 2016 performance year Provider-identifiable VM payment adjustment performance and PQRS quality measures will be published –https://www.cms.gov/Medicare/Quality-Initiatives-Patient- Assessment-Instruments/physician-compare-initiative/index.html  The reputational and consumer-choice impacts on provider organizations have the potential to dwarf the direct financial impacts of VM incentives and penalties 49

51. Accelerating healthcare quality improvement Challenges and Opportunities  Many big curves ahead –Having the right vehicle –Taking them at the right speed  Bottom line, it will all be in the implementation –The potential is enormous –Your patients are at the helm  Changing how care is given –Better teamwork –Better coordination across healthcare settings –More attention to population health –Putting the power of healthcare information to work 50

52. Accelerating healthcare quality improvement 51 “In the long history of humankind…those who learned to collaborate and improvise most effectively have prevailed.” --Charles Darwin

53. Accelerating healthcare quality improvement About HQSI HQSI is a nonprofit consulting firm dedicated to accelerating healthcare quality improvement. As a quality improvement consultant, HQSI designs, implements and evaluates data-driven quality improvement projects on behalf of government, public and private clients. As a URAC-accredited Independent Review Organization (IRO), HQSI performs IRO medical review services for insurers and providers. 52

54. Accelerating healthcare quality improvement HQSI’s Continuing Role as a Catalyst for Improvement in New Jersey 53 Under contract with the Centers for Medicare & Medicaid Services (CMS), HQSI served as New Jersey’s federally-designated Quality Improvement Organization (QIO) from 1984 to 2014 HQSI continues to implement the CMS national quality improvement agenda in New Jersey as a member of a regional Quality Improvement Network (QIN) www.qualiltyinsights-qin.org

55. Accelerating healthcare quality improvement 54 Remember… A Healthy Practice … is a Healthy Business!

56. Accelerating healthcare quality improvement 55 557 Cranbury Road, Suite 21 East Brunswick, NJ 08816 732.238.5570 www.hqsi.org Carolyn Hoitela Director, Practice Integration Phone: 732-343-1923 E-mail: choitela@hqsi.org