Tag: Medicaid

Study: Value-Based Programs May Harm Practices That ‘Disproportionately Serve High-Risk Patients’

Value-based payment programs may financially harm practices that disproportionately serve high-risk patients.

  • A new JAMA report that reviewed the first year of the Medicare Physician Value-Based Payment Modifier (PVBM) Program found providers who served “more socially high-risk patients had lower quality and lower costs, and practices that served more medically high-risk patients had lower quality and higher costs.”
  • The finding led to fewer bonuses and more penalties for high-risk practices.
  • The study authors said value-based payment programs may financially harm practices that “disproportionately serve high-risk patients.”



CMS created the PVBM to measure the quality and cost of care provided to Medicare beneficiaries. The program bases payments on providers’ performance on quality and cost measures and rewards quality performance and lower costs.

The agency began to phase in practices to the program in 2015 based on 2013 performance and then planned to expand it to solo practices and later to physician assistants, nurse practitioners, clinical nurse specialists and certified registered nurse anesthetists.

The study reviewed 899 physician practices with nearly 5.2 million beneficiaries that participated in the PVBM, a mandatory pay-for-performance program. Authors studied program payments in 2015 and compared them to 2013 fee-for-service (FFS) Medicare numbers.

The JAMA study’s finding that more medically high-risk patients had lower quality and higher costs is eye-opening. Those patients are usually the most costly and payment models will need to figure out ways to reduce those costs while not penalizing physicians if value-based programs are successful. A payment model that only lowers costs and improves care to healthy people won’t move the needle.

Even worse, if physicians are penalized, what incentive do doctors have to care for the sickest Medicare patients?

The JAMA report will likely not quell physician fears about how value-based programs may lead to lower Medicare payments. It also won’t satisfy individuals concerned that changes to the healthcare system may harm the most vulnerable, which is always a worry when there are major healthcare changes.

The JAMA study isn’t the first to show value-based programs as a mixed bag. Recent studies have shown that it hasn’t consistently improved outcomes and costs.

One key finding about value-based care so far has been that experience in the model plays an important role in whether a provider has success. Organizations with the most success under value-based programs have often spent years creating clinically integrated networks, James Landman, director of healthcare finance policy at the Healthcare Financial Management Association, recently told Healthcare Dive.

“If you look at the data for the Medicare Shared Savings Program, which is the biggest of the ACO programs under CMS, there is a correlation between time spent in the program and the ability to generate savings,” Landman said.

CMS is watching the results of value-based payment models like PVBM closely. The federal agency hopes to transfer 50% of traditional FFS Medicare payments to alternative payments models by next year.

CMS has slowed down the move to value-based payments, but that’s more due to the change in administration and slowly grinding gears of government than a move away from value-based programs.The federal agency has delayed the start of some programs to next year as well as paused expanding others.

Quality Payment Program Hardship Exception Application for 2017 Now Open

Quality Payment Program Hardship Exception Application for the 2017 transition year is now available
Photo from CMS.gov

Clinicians Can Now Submit Quality Payment Program Hardship Exception Applications

The Quality Payment Program Hardship Exception Application for the 2017 transition year is now available on the Quality Payment Program website.

MIPS eligible clinicians and groups may qualify for a reweighting of their Advancing Care Information performance category score to 0% of the final score, and can submit a hardship exception application, for one of the following specified reasons:

  • Insufficient internet connectivity
  • Extreme and uncontrollable circumstances
  • Lack of control over the availability of Certified EHR Technology (CEHRT)

There are some MIPS eligible clinicians who are considered Special Status, who will be automatically reweighted (or, exempted in the case of MIPS eligible clinicians participating in a MIPS APM) and do not need to submit a Quality Payment Program Hardship Exception Application.


About the Hardship Exception Application Process

In addition to submitting an application via the Quality Payment Program website, clinicians may also contact the Quality Payment Program Service Center and work with a representative to verbally submit an application.

To submit an application, you’ll need:

  • Your Taxpayer Identification Number (TIN) for group applications or National Provider Identifier (NPI) for individual applications;
  • Contact information for the person working on behalf of the individual clinician or group, including first and last name, e-mail address, and telephone number; and
  • Selection of hardship exception category (listed above) and supplemental information.

If you’re applying for a hardship exception based on the Extreme and Uncontrollable Circumstance category, you must select one of the following and provide a start and end date of when the circumstance occurred:

  • Disaster (e.g., a natural disaster in which the CEHRT was damaged or destroyed)
  • Practice or hospital closure
  • Severe financial distress (bankruptcy or debt restructuring)
  • EHR certification/vendor issues (CEHRT issues)

Please note: Once an application is submitted, you will receive a confirmation email that your application was submitted and is pending, approved, or dismissed. Applications will be processed on a rolling basis.


Explanation of Special Status Calculation

The Centers for Medicare and Medicaid Services (CMS) has introduced new information on the Quality Payment Program website that indicates whether clinicians have “special status” and can therefore be considered exempt from the Quality Payment Program.

To determine if a clinicians’ participation should be considered as special status under the Quality Payment Program, CMS retrieves and analyzes Medicare Part B claims data. A series of calculations are run to indicate a circumstance of the clinician’s practice for which special rules under the Quality Payment Program will affect the number of total measures, activities or entire categories that an individual clinician or group must report. These circumstances are applicable for clinicians in: Health Professional Shortage Area (HPSA), Rural, Non-patient facing, Hospital Based, and Small Practices.

For more information, please visit the Quality Payment Program website.


For Physicians, Rates Nearly the Same for Medicare and Medicare Advantage

Medicare and Medicare Advantage Plans Cost | DAS Health

When it comes to payment rates, physicians aren’t seeing much of a difference between traditional Medicare and Medicare Advantage plans, according to a new study.

Advantage plans managed by private insurers pay doctors prices similar to Medicare rates, according to the study led by University of Southern California researchers, which was published in JAMA Internal Medicine. However, on some services or equipment, commercial insurers have an advantage, the study found.

“With 1 in 3 beneficiaries enrolled in Medicare Advantage, it is important to look under the hood and get a better understanding of how these plans operate,” Erin Trish, the study’s lead author and an assistant research professor at the USC Schaeffer Center for Health Policy and Economics, said in a university announcement.

“We found that physician reimbursement rates in Medicare Advantage are very similar to traditional Medicare. This is very different than what we see in the commercial insurance market, where insurers tend to pay physicians more than Medicare—sometimes much more,” she said.

In the study, researchers analyzed a sample of 144 million claims from 2007 to 2012 in metropolitan areas and compared reimbursement rates for 11 common procedures. They found mean Medicare Advantage reimbursement rates nearly matched the traditional Medicare rate in many cases, such as the rate for an office visit, which was 97% of the Medicare rate.

Those findings raise the question of how reforms under discussion, which would transition the program toward a premium support model, could affect how physicians and other clinicians are paid, the study said.

The study also looked at prices paid for commercial insurance patients. In general, commercial insurers paid higher prices for procedures. However, for a few services, commercial prices were lower than traditional Medicare.

Senate Revises Healthcare Bill, Keeps Cruz Amendment for Skinny Coverage

Ted Cruz | DAS Health
Photo from Salon.com

The Senate health bill unveiled Thursday keeps a controversial amendment put forward by Senators Ted Cruz and Mike Lee to allow insurers to sell bare-bones plans to one segment of the population while offering coverage to the healthier sector at lower premium rates.

Provider and payer organizations that have weighed in on the amendment are against it, saying Cruz’s proposal would result in higher premiums for people with serious and chronic conditions.

This is because the amendment allows younger and healthier members to purchase non-ACA compliant plans that have lower premiums but fewer benefits.

Those with chronic or pre-existing conditions would purchase ACA-compliant plans that keep essential benefits. Insurers would be prohibited from setting premiums based on health status. Opponents said premiums would have to rise for all beneficiaries.

The bill would establish a federally funded high-risk pool in states to help offset the expense of coverage of higher-risk enrollees.

“This same kind of risk pool segmentation occurred prior to enactment of the ACA when 35 states operated high-risk pools for persons unable to obtain insurance on the private market,” said the July 12 letter to Senators from 13 groups including AARP and the American Cancer Society. “In that experience, most of those states could not provide sustained funding support and were forced to limit enrollment, reduce benefits, create waiting lists, and raise premiums and out-of-pocket costs to the point of unaffordability.”y

Insurers have also voiced their opposition in letters to Cruz.

America’s Health Insurance Plans said products governed by different rules and stands would further destabilize the individual market and increase costs for those with pre-existing conditions, according to the document obtained by The Washington Post.

Scott P. Serota, the president and chief executive of the Blue Cross Blue Shield Association also said the Cruz plan could make coverage unaffordable for people with pre-existing conditions.

Cost-sharing subsidies, of critical importance for insurers looking to remain in the exchange market, still disappear in two years under the revised Senate bill. The federally-funded CSRs allow insurers to give lower income beneficiaries a break in the cost of deductibles and out-of-pocket expenses.

The Senate bill revises a House bill released in May, but retains many of its provisions.

It keeps deep cuts to Medicaid, turning the federal entitlement program to state control that is federally funded. The funds would be capped per state based on the number of Medicaid beneficiaries.

Planned Parenthood would be banned from the Medicaid program for one year.

Also eliminated is Medicaid expansion starting in 2021, which was adopted by 31 states and the District of Columbia.

Providers have credited the ACA’s Medicaid expansion with helping to lower the amount of uncompensated cost of care.

On its website, the American Hospital Association asks members to click to tell senators they oppose the Better Care Reconciliation Act.

Former Centers for Medicare and Medicaid Services Acting Administrator Andy Slavitt tweeted, “The Senate Trumpcare bill amendment was just released & it went from very bad to unworkably bad. First analysis.”

The revised bill retains some of the Affordable Care Act taxes on the wealthy to pay for provisions.

The legislation retains a 3.8 percent tax on net investment income for individuals earning more than $200,000 and couples earning more than $250,000; and an 0.9 percent surtax for the Medicare insurance program for the elderly on people with those incomes, according to Reuters.

Under the Senate bill, insurance subsidies based on income would be scaled back to 350 percent of the federal poverty level, according to Politico.

The revised Senate bill gives $45 billion for opioid funding as opposed to the $2 billion in the original bill, Politico reported.

It keeps a tax break for health insurance executives.

It would allow consumers to receive tax credits to purchase catastrophic health plan coverage and would also allow people to use health savings accounts to pay for premiums.

The individual and employer mandates to buy insurance goes away, but individuals who drop their coverage would be unable to purchase new coverage for six months.

The Senate is expected to vote on the bill next week after the Congressional Budget Office scores the financial and coverage impacts of the bill.

Senate Majority Leader Mitch McConnell can afford to lose only two votes. Last month at least 10 Senators opposed an earlier version of the bill.

The CBO estimated the earlier Senate bill would leave 22 million more people uninsured over a decade compared to the ACA. This bill never made it to a vote but was scrapped before the July 4 recess.

Survey Finds Fewer Than 1 in 4 Doctors Prepared for MACRA

MACRA Will Cost Physicians Money

Among doctors in decision-making roles, fewer than 1 in 4 say they are well prepared to meet quality reporting requirements under MACRA.

Most of the 1,000 practicing physicians who have been involved in practice decision-making related to the government’s new Medicare payment system feel they are not prepared to meet requirements in 2017, according to the survey by the American Medical Association and the auditing firm KPMG.

The survey also found that 90% of the doctors described the Merit-based Incentive Payment System (MIPS), one of two payment tracks under the Medicare Access and CHIP Reauthorization Act (MACRA), as burdensome. Only 8% of the doctors said they are very prepared for long-term financial success under the program.

RELATED: Need reporting assistance? See what DAS’ Government Incentives services have to offer. 

The poll was conducted before the Centers for Medicare & Medicaid Services released a final rule last week that eases some of the reporting requirements under MACRA for smaller practices. Some of those proposed requirement changes are due to the fact that doctors have struggled to prepare for the new MACRA requirements, as confirmed by the study.

Physicians are now in the first year of MACRA, a transition year that allows for a “pick your pace” option to help ease them into the new payment system and avoid penalties. Even so, “this survey showed that about a third of respondents are unlikely to meet the basic standard of one patient, one measure, no penalty,” said AMA President David O. Barbe.

The survey results are detailed in a report, which was released at the Eighth Annual Alternative Payment Model and Accountable Care Organization Summit in Virginia.

Of the survey respondents, 56% said they plan to participate in MIPS in 2017, while 18% will participate under the Advanced Alternative Payment Model (APM) track of MACRA. A majority (51%) of physicians said they are somewhat knowledgeable about MACRA and only 8% say they are “deeply knowledgeable” about the program.

In terms of the burdens imposed by the program, the time required to report performance was the most significant challenge, followed by understanding requirements, how MIPS performance is scored, and the cost required to accurately capture and report performance. Physicians in smaller practices (4 or fewer providers) and those without experience in existing value-based reporting systems were significantly more likely to view requirements as “very” burdensome and feel less well prepared for long-term financial success, according to the survey.

Barbe said the AMA has developed resources to help physicians comply with MACRA, including a free video on minimum reporting requirements to avoid a penalty in 2019 for failure to report this year.

Proposed Budget Would Cut $636B from HHS Agencies

As part of his $4 trillion budget for next year, President Donald Trump is proposing a $636 billion cut in federal funding for CMS programs over the next decade. Those cuts would make room for more spending on defense and border security.

The budget also proposes deep cuts to Medicaid—previously reported around $800 billion over the next decade. Those savings would come from transforming Medicaid into a per capita cap program starting in 2020. That’s the same move proposed in the House’s Obamacare replacement bill.

Medicare is not directly slashed in Trump’s budget, allowing the President to maintain part of his campaign promise to not touch either entitlement program despite federally subsidized healthcare being one of the biggest contributors to the national debt. In its final report on the state of the CMS, the Obama administration conceded that Medicaid was on track to deplete other federal programs.

Trump’s proposed budget still needs to be passed by Congress and that’s unlikely to happen in its current form.

“I just think it’s the prerogative of Congress to make those decisions in consultation with the president,” Sen. John Cornyn (R-Texas) said as he predicted the Medicaid cuts wouldn’t survive the Senate. “But almost every president’s budget proposal that I know of is basically dead on arrival.”

Trump’s budget extends funding for the Children’s Health Insurance Program, which is up for renewal at the end of this year.

States, however, would lose the enhanced match funding provided by the Affordable Care Act. The law gave states a 23-percentage-point bump in federal matching rates.

The draft budget also ends a provision that prevented states from narrowing the pool of eligible CHIP beneficiaries below what it was in 2010, the first year the ACA kicked in.

The Independent Payment Advisory Board, a panel that was created in the ACA whose sole purpose was to rein in Medicare costs if the program reached insolvency, would be repealed. That move would garner $7.6 billion in administrative costs over 10 years, according to the budget proposal.

Trump’s plan promises that overhauling the tax code and easing regulations will lift economic growth from the lackluster 2.1 percent average rate of recent years to sustained annual gains of 3 percent or better. Higher growth means lower deficits and Trump’s plan folds in more than $2 trillion in unspecified deficit savings over the coming decade from “economic feedback” to promise balance.

Trump also wants to overhaul medical malpractice laws, stating they add to the average American’s healthcare costs. The proposed reforms would save HHS programs $31.8 billion over 10 years and $55 billion to the federal government overall.

A chunk of these savings would result from fewer unnecessary services and curbing the practice of defensive medicine, according to the budget proposal. Trump proposes capping awards for noneconomic damages at $250,000 indexed to inflation. There would also be a three-year statute of limitation on claims.

Trump’s budget targets the National Institutes of Health, though Congress made it clear that it’s willing to spend on medical research, adding $2 billion to NIH funding when Trump had suggested a $1.2 billion cut in the remainder of 2017.

For 2018, HHS continues to recommend a cut of $5.8 billion, with the biggest cuts in the National Cancer Instute, at $1 billion; National Institute of Allergy and Infectious Diseases, at about $840 million; and National institute of Diabetes & Digestive & Kidney Diseases at $355 million.

The National Cancer Institute was particularly favored by appropriators earlier this month, with a $476 million increase.

HHS seeks to reduce how much labs can put towards overhead, such as fringe benefits, utilities and buying lab equipment. On average, labs get 30% of the total grant for overhead, higher than the overhead percentage from private funders.

The budget said: “NIH will implement reforms to release grantees from the costly and time-consuming indirect rate setting process and reporting requirements. Applying a uniform indirect cost rate to all grants mitigates the risk for fraud and abuse because it can be simply and uniformly applied to grantees. The Budget includes this critical reform to reduce indirect costs and preserve more funding for direct science.”

The budget did not say what that overhead amount would be, however.

It’s not just overhead that would fall in the unlikely case that Congress passed this plan. The Trump draft budget would eliminate 1,648 in 2018 for a total of 7,326 for the year.

Diana Zuckerman, president of the National Center for Health Research, does not expect Congress, which was generous to the institutes earlier this month, to support Trump’s cuts.

“I have never known Congress that enthusiastically cut NIH funding,” she said.

But she’s less sanguine about the fate of the Centers for Disease Control and Prevention, which would be cut by $1.3 billion, or just over 20%, in this budget.

Congress loves NIH, but she said, “they don’t realize, whether it’s CDC or AHRQ (Agency for Healthcare Research and Quality), that they have a very important role to play.”

AHRQ is zeroed out in the Trump budget, but NIH would receive $272 million to carry out similar initiatives.

The budget says CDC can still protect the nation and the world at the proposed funding level and that it can even respond to emerging health threats such as Zika.

The administration is prioritizing opioid abuse prevention efforts, combating childhood obesity, vaccine stockpiling and investing in CDC infrastructure, the document states.

Despite that statement, the budget proposes a 17% cut to the CDC’s sexually transmitted disease and tuberculosis prevention efforts. Immunization and influenza preparation funding would fall by 10%. Chronic disease prevention and health promotion would be cut by 19%.

Trump’s plan promises that overhauling the tax code and easing regulations will lift economic growth from the lackluster 2.1% average rate of recent years to sustained annual gains of 3% or better. Higher growth means lower deficits and Trump’s plan folds in more than $2 trillion in unspecified deficit savings over the coming decade from “economic feedback” to promise balance.