Brian Ellsworth, MA, Director, Payment Transformation
Health Dimensions Group
In a year where we have witnessed many twists and turns in health policy and politics writ large, we should no longer be surprised by anything. To that end, on December 20, 2016, the Centers for Medicare and Medicaid Services (CMS) finalized the Advancing Care Coordination through Episode Payment Models rule that was first proposed in July 2016, as well as finalized a new payment track for Medicare ACOs. Hospitals in the designated regions would be required to participate in 90-day episodic payment models for cardiac and orthopedic bundles. Unless delayed or repealed by the incoming Administration, the mandatory episode payment models would go into effect in a few short months (July 1, 2017) as originally proposed.
There is some controversy about mandatory episodic payment models. In September 2016, 179 Members of Congress, including incoming Secretary of Health and Human Services designee Dr. Tom Price, wrote to CMS expressing their concerns about implementing large scale, mandatory alternative payment models (APMs) without Congressional input, possibly affecting care to patients and commandeering clinical decision-making. In addition, the incoming Trump administration has made no secret of its disdain for last-minute rulemaking that imposes significant new mandates on regulated entities.
That said, CMS makes several compelling arguments in the final rule for moving forward in response to those and other concerns:
Exactly how all of these dynamics are going to play out after Inauguration Day remains as yet unknown. Given the few short months until implementation as the final rule currently reads, it is not too soon to prepare for significant value-based transformation, especially in markets where there will be multiple mandatory and voluntary alternative payment models in play.
Here are some of the key things that hospitals, physicians, and post-acute providers need to know about the final rule:
Many of the features of the episodic payment models, such as waivers of payment and coverage rules (e.g., three-day prior stay rule for Medicare SNF coverage) and beneficiary notification requirements are similar to, or the same as, originally proposed.
Of particular note are the emerging rules on how all of these payment models will overlap. For instance:
These emerging complexities must be mastered on a market-by-market basis by providers seeking to position themselves for success in a value-based world. In coming weeks, HDG will summarize important details and provide a webinar on January 19, 2017. Also, these and other issues will be discussed in the Intensive Session: Owning the Risk-A Journey into Value-Based Transformation at our National Summit in San Diego, California, on Tuesday, February 28, 2017, from 2:00 p.m. to 4:30 p.m.
In the meantime, the Advancing Care Coordination through Episode Payment Models final rule can be viewed at https://www.federalregister.gov/public-inspection/current starting December 21, 2016. For more information about the individual cardiac and orthopedic bundled payment models finalized through this rule, visit the CMS Innovation Center website at https://innovation.cms.gov/initiatives/epm.