REGULATORY INTELLIGENCE YEAR-END REPORT - 2022 Health Policy Tracking Service - Issue Briefs Healthcare Reform Payment Reform This Issue Brief was written by a contributing writer. 12/19/2022 Introduction A recent study showed that state Medicaid programs are utilizing managed care and other service delivery and payment system reforms, financial incentives, and managed care contracting requirements to improve quality of care and lower costs. Congress recently passed a bill that will spare health care providers from a payment reduction for Medicare payments in 2022. The Centers for Medicare & Medicaid Services (CMS) released data showing that ACOs are serving an increasing number of patients in the United States. The National Association of Accountable Care Organizations (NAACOS) called for an increase in the use of value-based payment systems throughout the United States after data showed only modest increases in 2022. According to a recent study, most physicians employed in group practice owned by health systems receive pay based on the volume of care they provide. Today, U.S. Senators Michael Bennet (D-Colo.) and Bill Cassidy (R-La.), and U.S. Representatives Peter Welch (D-Vt.) and Michael Burgess (R-Texas) introduced a bill that would reauthorize the Centers for Medicare & Medicaid Services (CMS) technical assistance initiative for clinicians operating small practices. The Centers for Medicare and Medicaid Services (CMS) announced the redesign of the ACO Realizing Equity, Access, and Community Health (REACH) Model. The change was made to better reflect the agency's aim to create a health system with equitable outcomes for patients. Over two hundred organizations signed a letter to Health and Human Services Secretary Xavier Becerra in support of fixing rather than ending the Direct Contracting Model, an accountable care model from the CMS Innovation Center. The Centers for Medicare & Medicaid Services (CMS) released a fact sheet outlining the creation of the new payment reform model, the ACO REACH Model. The National Association of ACOs (NAACOS) announced the formation of the ACO REACH Coalition. The new coalition will focus on education and advocacy to support health care providers in the new Medicare value-based payment model. During a press conference, Unites States Department of Health and Human Services (HHS) Secretary Xavier Becerra indicated interest in reforming the Medicare Physician Fee Schedule. The largest and most successful Medicare ACO had its 10-year anniversary in April 2022. The National Association of ACOs (NAACOS) celebrated with a social media campaign centering the ACO. New York Governor Kathy Hochul announced a multi-year healthcare investment including payment reform efforts in the FY 2023 State Budget. The Illinois legislature passed a bill that aims to reward Medicaid-funded nursing homes for improving the quality of care for residents. A bill introduced in the Colorado legislature aims to reduce the administrative burden for healthcare providers participating in payment reform systems. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. A recent report from the Healthcare Information and Management Systems Society indicated that a total investment of approximately $36.7 billion over the next ten years is necessary to modernize State, Territorial, Local and Tribal (STLT) public health infrastructure. A recent article emphasized the need for more efficient and transparent data sharing methods to improve the transition to value-based care models in healthcare throughout the nation. Value-based care is on track to account for over half of the business of home healthcare providers within the next three to five years, according to a recent survey. CareMax closed its purchase of Steward's value-based care network, indicating that it would cover a total of 205,000 senior beneficiaries living in ten states under value-based care arrangements. The American Society for Radiation Oncology (ASTRO) submitted a letter to the Centers for Medicare and Medicaid Services' (CMS) in response to the proposed rule that would indefinitely postpone the start of an alternative payment model for radiation oncology, also known as the RO Model. The Centers for Medicare & Medicaid Service's (CMS) Innovation Center announced a new, voluntary Enhancing Oncology Model (EOM) aimed at improving care for patients and reducing spending. National Association of ACOs (NAACOS) President and CEO Clif Gaus, Sc.D. released a response praising the Centers for Medicare and Medicaid Services for the Proposed 2023 Medicare Physician Fee Schedule. The Centers for Medicare & Medicaid Services (CMS) recently released the Calendar Year 2023 Physician Fee Schedule (PFS) proposed rule. Recent research has shown the importance of payment reform for hospital systems in rural areas, leading to funding from the federal government for projects like the Pennsylvania Rural Health Model. Recent proposals from the Centers for Medicare & Medicaid Services (CMS) will bring significant changes to its accountable care organization (ACO) model, however skilled nursing will not see a lasting impact from the changes. According to a recent article in JAMA Network, action is needed to align value-based payments with health equity. The Centers for Medicare & Medicaid Services (CMS) recently issued an informational bulletin encouraging states to take actions using existing Medicaid authorities toward payment reform to improve outcomes for nursing home residents and make improvements for staff pay, training and retention. The Centers for Medicare & Medicaid Services (CMS) announced that the Medicare Shared Savings Program saved Medicare $1.66 billion in 2021 compared to spending targets. Over 800 health care associations, accountable care organizations (ACOs), medical practices, and health systems signed a letter to Congress asking the legislature to extend incentive payments designed to encourage participation in risk-bearing alternative payment models (APMs). According to a recent study, accountable care organizations (ACOs) that serve a large percentage of patients from racial and ethnic minority groups are more likely to leave the Medicare Shared Savings Program. Blue Shield of California has created a new value-based, shared savings payment model for specialty care physician practices. A new report showed that healthcare providers participating actively in value-based care payment see more patients, have more experience, and are more open to increasing their panels. The National Association of ACOs (NAACOS) recently called for the Centers for Medicare & Medicaid Services (CMS) to create a small pilot program to test the reporting of quality data sourced from electronic health records (EHRS). The Delaware Department of Insurance appointed Cristine Vogel as its first director of value-based healthcare delivery. Six United States healthcare organizations created a coalition to support federal policies in favor of payment reform in healthcare. The Centers for Medicare & Medicaid Services (CMS) announced that the Medicare Shared Savings Program saved Medicare $1.66 billion in 2021 compared to spending targets. Over 800 health care associations, accountable care organizations (ACOs), medical practices, and health systems signed a letter to Congress asking the legislature to extend incentive payments designed to encourage participation in risk-bearing alternative payment models (APMs). According to a recent study, accountable care organizations (ACOs) that serve a large percentage of patients from racial and ethnic minority groups are more likely to leave the Medicare Shared Savings Program. Blue Shield of California has created a new value-based, shared savings payment model for specialty care physician practices. A new report showed that healthcare providers participating actively in value-based care payment see more patients, have more experience, and are more open to increasing their panels. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. The National Association of ACOs (NAACOS) recently called for the Centers for Medicare & Medicaid Services (CMS) to create a small pilot program to test the reporting of quality data sourced from electronic health records (EHRS). The Delaware Department of Insurance appointed Cristine Vogel as its first director of value-based healthcare delivery. Six United States healthcare organizations created a coalition to support federal policies in favor of payment reform in healthcare. Providers Temporarily Spared from Payment Reduction Congress recently passed a bill that will spare health care providers from a payment reduction for Medicare payments in 2022. The pending payment reduction was nearly ten percent. Industry groups such as ASC and the Surgical Care Coalition supported the bill but indicated that more work was needed to help physicians and hospitals, especially considering the pressures of the pandemic. The legislation expanded the moratoriums on the Medicare sequestration and statutory Pay-As-You-Go cuts and a planned reduction to the Medicare Physician Fee Schedule rates. The new law will halt a 2 percent Medicare sequester cut but only until April 2022. A 1 percent cut to Medicare pay to providers will go through June. After June, the full cut will resume. In the beginning of 2023, the PAYGO cuts will resume. The Medicare Physician Fee Schedule cuts will go forward as planned. 'Providers are still at risk and it's because of the temporary nature," Darryl Drevna, MA, senior director of Regulatory and Public Policy at AMGA, said. Organizations including AMGA are planning on lobbying to extend the delay of the statutory Medicare payment cuts. Due to the ongoing coronavirus pandemic, providers are expected to face financial issues throughout 2022. According to Jamie Miller, MBA, senior director of Government Relations at AMGA, 'Although this is a victory, we can't give up because this is going to be a constant issue for our members every year until we can work with Congress to do something more permanent." Organizations advocating for providers are looking for permanent fixes for some of the policies implemented during the COVID-19 pandemic to financially help health care providers. 'The big deadline is in July with the sequestration," Miller noted. 'But also when the public health emergency began, all these waivers were passed to help deliver of care. Many of those waivers dealt with Medicare covering telehealth services." The waivers will expire with the end of the public health emergency, a date uncertain. Waivers are for geographic and site of service flexibilities, payment parity, and an expanded list of covered telehealth services. HHS renews the public health emergency status every three months. Pending bills would make some of the waivers permanent. Telehealth waivers would allow for access to virtual care for Medicare beneficiaries. Many patients favor the convenience and ease of access to medical care through telehealth appointments. However, providers want equal or higher payment for telehealth services as for in-person services. Christian Shalgian, the director of the Division of Advocacy and Health Policy at ACS, indicated that the payment system needs significant reform. Work is needed on the value-based reimbursement system implemented under MACRA, or the Medicare Access and CHIP Reauthorization Act of 2015. The largest payment track, Merit-based Incentive Payment System (MIPS) has not yet reached full implementation. It was further delayed by the COVID-19 pandemic. 'It brings no stability to the system," Shalgian asserted. 'And we need that stability for the system so that surgeons can continue to treat Medicare patients and know what the payment system is going to look like going forward. " [FN2] State Use of Payment Reform A recent study showed that state Medicaid programs are utilizing managed care and other service delivery and payment system reforms, financial incentives, and managed care contracting requirements to improve quality of care and lower costs. Researchers at the Kaiser Family Foundation found that state Medicaid programs implemented patient-centered medical homes (PCMHs), ACA Health Homes, accountable care organizations (ACOs), and episodes of care. They found that state programs varied as to the most widely used models, the combination and implementation of the models, and the length of time states attempt to change payment and delivery systems. Some of the payment and delivery system reform models were implemented through Medicaid fee-for-service (FFS) delivery systems. Other models were implemented through managed care. More research is needed on the payment models. However, states have had success with varied models that have changed over time. States use a variety of financial incentives to improve the quality of care by making bonuses or penalties dependent on performance. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. Researchers found, 'Additionally, as part of delivery and payment reform efforts and/or through managed care plan contract requirements, states have also been focused on adjusting provider payment models to incentivize quality ? through the use of "altemative payment models' (APMs)." Some evidence showed that financial incentives at the state level improved quality and outcomes, results at the provider level were less clear, particularly considering the significant impact of the COVID-19 pandemic on health care delivery. [FNS] Organization Calls for Action to Increase Use of Value-Based Payment The National Association of Accountable Care Organizations (NAACOS) called for an increase in the use of value-based payment systems throughout the United States after data showed only modest increases in 2022. The number of accountable care organizations (ACOs) in the Medicare Shared Savings Program (MSSP), increased to 483 in 2022. The MSSP is the dominant value-based payment program in the United States. NAACOS indicated, 'Following multiple years of flat or declining ACO growth, today's announcement is disappointing and should send a wake-up call to an administration whose goal is to have all traditional Medicare patients in an accountable care model by 2030. There are still fewer patients in ACOs and ACOs in the program than there were in 2020." Forty-six ACOs are beginning their initial agreement period this year. Some of them have prior experience in payment reform programs under Medicare. Some participated in the Next Generation ACO Model, which is now expired. Participation in the MSSP has never regained the ACO participation level it had prior to 2018 when CMS implemented the 'Pathways to Success" rule creating increased risk for ACOs. In 2018, MSSP ACOs numbered 561. By 2021, it was 477. The CMS Innovation Center focused on bringing all traditional Medicare beneficiaries to health care providers operating under a payment reform system accountable for quality and total cost of care by 2030. NAACOS supports this goal but calls it 'lofty." NAACOS noted, 'Action is needed to increase participation in ACOs." 'NAACOS is extremely disappointed in today's news. When considering former Next Generation ACOs who moved into MSSP and the fact that there was no opportunity to join the model in 2021, you could consider this a shrinking of this important ACO model. Today shouldn't be celebrated but instead should be a call to action for policymakers to correct this trend and address incentives to spur participation in a voluntary program that has repeatedly yielded savings and provides high quality care," said Clif Gaus, Sc.D., president and CEO of the National Association of ACOs (NAACOS). The organization made several suggestions to attract new ACOs and keep the existing ACOs in payment reform systems-'increasing ACO shared savings rates, fixing key benchmarking and risk adjustment issues, allowing more time before requiring risk, minimizing administrative burdens, rethinking quality reporting requirements, and providing more timely and complete data." 'NAACOS is waiting to see what participation is like in the new Direct Contracting Model, another accountable care model. Hopefully, that will account for some of the lack of growth in the Shared Savings Program," Gaus said. 'With Medicare spending continuing to rise to out-of-control levels and ACOs proving they can effectively increase quality and lower spending, more focus needs to be on increasing the size of ACO programs in traditional Medicare, which needs to happen at levels much greater than what we've seen today." Eighteen of the 46 new ACOs are former participants of Next Generation ACO. 2022 participation data also showed: -11 million beneficiaries are cared for by an ACO -ACOs are the largest alternative payment model in Medicare -59 percent of ACOs are in two-sided risk and 41 percent are in one-sided risk -Nearly 529,000 physicians and other non-physicians are in ACOs -More than 1,300 hospitals are in ACOs -ACOs have saved Medicare $13.3 billion in gross savings and $4.7 in net savings since 2012 -ACOs continued to provide high-quality care and yield satisfied patients -ACOs care for nearly 20 percent of all Medicare patients and nearly a third of traditional Medicare patients. [FN4] CMS Data Shows Growing Patient Population Served by ACOs The Centers for Medicare & Medicaid Services (CMS) released data showing that ACOs are serving an increasing number of patients in the United States. The data was part of CMS' annual summary of the Medicare Shared Savings Program, Medicare's national ACO program. According to CMS, over 11 million people with Medicare will be served by Shared Savings Program ACOs in 2022. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. 'With one in every five health care dollars paid by Medicare, we can strengthen and transform our health care system," said CMS Administrator Chiquita Brooks-LaSure. 'Accountable Care Organizations present an invaluable opportunity to move Medicare toward person-centered care." CMS indicated that 66 new ACOs joined the program. 140 ACOs renewed participation beginning January 1, 2022. While the total number of ACOs in the Shared Savings Program is only 483 in 2022, over 11 million people with Medicare are served by a health care provider in a Shared Savings Program ACO. This number is an increase of 324,000 (3%) patients from the previous year. 'Over the last decade, Medicare has promoted participation in value-based care to reward better care, smarter spending, and improved outcomes," said Meena Seshamani, MD, PhD, CMS Deputy Administrator and Director of the Center for Medicare. 'CMS' commitment to value-based care has never been stronger. As we continue working toward our goal of increasing the number of people in a care relationship with accountability for quality and total cost of care, we celebrate this increase in ACO participation, and know we have more work to do. [FNS Bill to Support Small Practice Participation in Payment Reform Today, U.S. Senators Michael Bennet (D-Colo.) and Bill Cassidy (R-La.), and U.S. Representatives Peter Welch (D-Vt.) and Michael Burgess (R-Texas) introduced a bill that would reauthorize the Centers for Medicare & Medicaid Services (CMS) technical assistance initiative for clinicians operating small practices. The Small Practice, Underserved, and Rural Support Program Extension Act of 2022 (SURS Extension Act) would assist small practices participating in the Quality Payment Program (QPP) known as the Small, Underserved, and Rural Support (SURS) program. If Congress does not act, the SURS program will end February 15, 2022. 'Extending the SURS program is an important bipartisan effort that will help small providers in Colorado and across the nation," said Bennet. 'Our legislation will extend the program, helping small and many rural providers move towards quality payment models and, in turn, lowering costs and improving outcomes for patients. I'll continue working with my colleagues to ensure we secure an extension of this vital program." 'Small health care providers in rural and underserved areas don't have the big administrative staffs to deal with complex Medicare reporting requirements," said Dr. Cassidy. 'This legislation gives support to small practice docs so they can focus on providing the best quality care for their communities." 'This legislation extends much-needed help for the small and rural health care providers that are at the heart of Vermont's health care system," said Welch. 'Extending the QPP-SURS program helps make sure that rural clinicians get the technical assistance they need to provide high quality affordable and accessible care to Medicare patients." 'Our health care heroes have put it all on the line over the duration of this pandemic," said Dr. Burgess. 'We have a responsibility to support them in every way we can. This program has been successful in providing the technical support needed to navigate reporting requirement for rural and underserved physicians who want to transition to value-based care. We must provide this support to physicians who want to modernize their models of care." The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) was signed into law created the QPP in May 2015. The SURS program received funding and authorization under MACRA. SURS is a program- and practice-level technical assistance program for Merit-based Incentive Payment System (MIPS) eligible health care professionals participating in practices with 15 or fewer providers. Priority under the program is given to practices in rural areas, areas experiencing a health professional shortage, and areas that are medically underserved. SURS has provided direct support annually to an average of 107,250 clinicians throughout the United States. 'We commend the introduction of the SURS Extension Act and encourage its swift passage. Physicians in rural parts of the state have and will continue to depend on this program to help them provide the quality, cost-effective care that Medicare patients need whether they're from Colorado's Eastern Plains or the Western Slope. The technical assistance provided by the program is incredibly valuable to ensure that small practices in rural and underserved areas have the support and tools necessary to succeed in the continuously changing MIPS program," said Mark B. Johnson, MD, MPH, President of Colorado Medical Society. A significant number of physicians organizations and other medical organizations support the SURS Extension Act. The groups co-signed a letter in support of the bill, writing in part, '[P]Jayment reform programs are complex, and clinicians require supplemental resources and guidance to meet the substantial quality and cost containment aspirations of payment models-The COVID-19 pandemic has further exacerbated this issue by restricting the availability of these clinicians to understand updates and changes to payment reform programs. The SURS Extension Act extends the QPP-SURS program until 2027 and ensures that small practices in rural and underserved areas have the support and tools necessary to succeed in the MIPS program." [FN6] THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. Study: Most Physicians Paid by Volume According to a recent study, most physicians employed in group practice owned by health systems receive pay based on the volume of care they provide. RAND Corporation researchers noted that pay-per-service is still dominant despite efforts to transition to payment reform where pay is based on the quality and value of care rather than volume of services. Researchers looked at data from a wide range of medical practices, all owned by health systems. They found that the most common type of payment system was based on volume. Over 80% of primary care physicians and over 90% of physician specialists were paid under a traditional system. Health systems did often use financial incentives for quality and cost performance. However, the percentage of total physician compensation under a payment reform system was only 9% for primary care providers and 5% for specialists. JAMA Health Forum published the findings. 'Despite growth in value-based programs and the need to improve value in health care, physician compensation arrangements in health systems do not currently emphasize value," said Rachel O. Reid, the study's lead author and a physician policy researcher at RAND, a nonprofit research organization. 'The payment systems that are most often in place are designed to maximize health system revenue by incentivizing providers within the system to deliver more services. " [FN7] Providers Support Payment Reform Program Over two hundred organizations signed a letter to Health and Human Services Secretary Xavier Becerra in support of fixing rather than ending the Direct Contracting Model, an accountable care model from the CMS Innovation Center. The organizations included prominent trade groups, like the National Association of ACOs, health systems, medical practices, Direct Contracting Entities (DCEs), ACOs, and others. According to the National Association of ACOs (NAACOS), Becerra and the White House are considering cancelling the Direct Contracting program. The organizations urged them to keep the model and make changes to improve it to further support patients and providers. NAACOS indicated, 'Direct Contracting is currently the premier accountable care model from the CMS Innovation Center." The program seeks to build on the successful Next Generation ACO Model. It is also intended to redesign healthcare delivery and payment. The model incentivizes providers to manage complex chronic diseases, encourage use of preventive services, and coordinate care. 'Cancelling Direct Contracting would additionally undermine the work of the Center for Medicare and Medicaid Innovation (Innovation Center) and the Centers for Medicare & Medicaid Services (CMS)," the letter states. 'Rather than cancelling Direct Contracting, a better option is to adjust the model, which the CMS Innovation Center can quickly do. Fix, don't end, the Direct Contracting Model.' The organizations suggested fixes such as rebranding and a name change to help communicate that the model is part of changes to accountable care. They suggested additional constraints on participation and enhancing patient protections. NAACOS also suggested that CMS clearly indicate the termination of the Geographic Direct Contracting Model. That model was creating confusion with the Global and Professional options. The consequences of abruptly ending Global and Professional Direct Contracting include termination without warning of health care providers from value-based payment participation. Those providers would be less likely to participate in payment reform models in the future, stated NAACOS. 'CMS officials have stated that DCEs have proportionately more providers in communities with high numbers of low-income and minority patients. The model in fact incentivizes care for sicker, high-needs patients," the letter states 'Lessons learned from the model could be applied to other payment models. Canceling Direct Contracting would hurt our health system's efforts to address health disparities.' Direct Contracting is based on the Next Generation ACO Model. That model has improved health care and generated $1.7 billion in gross savings and $836 in net savings to CMS over a four-year period beginning in 2016. Overall, ACOs have saved Medicare $13.3 billion in gross savings and $4.7 in net savings since 2012. ACOs care for almost 20 percent of all Medicare patients and almost one third of traditional Medicare patients. [FN8] CMS Redesigns Payment Reform Program The Centers for Medicare and Medicaid Services (CMS) announced the redesign of the ACO Realizing Equity, Access, and Community Health (REACH) Model. The change was made to better reflect the agency's aim to create a health system with equitable outcomes for patients. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. The changes focus on improving quality, affordability, and personalization of care. REACH is a redesign of the Global and Professional Direct Contracting (GPDC) Model. The changes address feedback from stakeholders, participant experience, and administrative priorities. It is particularly focused on health equity. The transition also comes with the immediate cancellation of the Geographic Direct Contracting Model (also known as the 'Geo Model"). Stakeholder concerns led to the pausing of the Geo Model in March 2021. It was introduced in December 2020. 'The Biden-Harris Administration remains committed to promoting value-based care that improves the health care experience of people with Medicare, Medicaid and Marketplace coverage," said CMS Administrator Chiquita Brooks-LaSure. 'To fulfill that commitment, CMS, through the Innovation Center, is testing new models of health care service delivery and payment to improve the quality of care that people receive, including those in underserved communities. The Innovation Center is making improvements to existing models and launching new models to increase participation in our portfolio, and CMS will be a strong collaborator to health care providers that participate in those models." CMS is focused on the Innovation Center's vision for the next decade of improving patient care. It wishes to work with partners sharing the vision and values. The three key guiding principles are: -First, any model that CMS tests within Traditional Medicare must ensure that beneficiaries retain all rights that are afforded to them, including freedom of choice of all Medicare-enrolled providers and suppliers. -Second, CMS must have confidence that any model it tests works to promote greater equity in the delivery of high-quality services. -Third, CMS expects models to extend their reach into underserved communities to improve access to services and quality outcomes. CMS noted, 'Models that do not meet these core principles will be redesigned or will not move forward." [FNS] Organization Announces Creation of ACO REACH Coalition The National Association of ACOs (NAACOS) announced the formation of the ACO REACH Coalition. The new coalition will focus on education and advocacy to support health care providers in the new Medicare value-based payment model. The Centers for Medicare & Medicaid Services (CMS) announced a new initiative called the ACO Realizing Equity, Access, and Community Health (REACH) Model. This new premier accountable care model from the CMS Innovation Center adds to over ten years of bipartisan Medicare accountable care programs. According to NAACOS, these programs have been successful for patients, providers, and the Medicare Trust Fund. 'The ACO REACH Model is a positive step on the important journey to value-based care and will support CMS's work to have all Medicare beneficiaries in an accountable care relationship by 2030," said Clif Gaus, Sc.D., NAACOS President and CEO. 'The REACH Model's focus on equity, increased provider governance, improvements to risk adjustment, and other changes are critical updates to accountable care that will benefit patients and historically underserved communities. The new ACO REACH Coalition will help drive model participation and ensure REACH will be the next in a growing line of successful accountable care models.' The focus of the ACO REACH Coalition will be on providing resources and education to health care providers considering joining the model when it is implemented in 2023. The organization will continue to support providers during the program. The coalition will produce webinars and resources that analyze key details and aspects of the model, house key resources on a standalone page, hold in-person conference sessions and networking events, and provide a dedicated listserv to engage with peers about the model, among other benefits. In addition, the ACO REACH Coalition will advocate for improvements to the payment model that will benefit patients and health care providers participating in the payment reform model. NAACOS is striving for education efforts related to the ACO REACH Model and the transition to value-based payment systems. The association announced that Elizabeth Fowler, Ph.D., J.D., the CMS Deputy Administrator and Director of the Innovation Center, will be a keynote speaker at the NAACOS conference scheduled for April. According to CMS, the ACO REACH Model aims for health equity. The model specifically requires all participants to develop and implement a robust health equity plan to identify underserved communities and launch initiatives to measurably reduce health disparities within their patient populations. NAACOS emphasized the importance of addressing health equity through the new model and improvements in this arena when compared to a similar initiative currently operating, the Direct Contracting Model. The organization lobbied for the improvement of that model. Many of the proposed changes will be implemented under the new model. 'As the accountable care movement grows and evolves, so too must NAACOS," Gaus said. 'We are fully embracing the ACO REACH Model and look forward to supporting its ACO participants.' [FN10] CMS Releases Fact Sheet for ACO REACH Model THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. The Centers for Medicare & Medicaid Services (CMS) released a fact sheet outlining the creation of the new payment reform model, the ACO REACH Model. It is a redesign of the Global and Professional Direct Contracting Model (GPDC) Model. The new model is focused on advancing priorities of the Biden Administration, including the commitment to advancing health equity. The model will be renamed the ACO REACH model to reflect its purpose: 'to encourage health care providers to coordinate care to improve the care offered to people with Medicare ? especially those from underserved communities, a priority of the Biden-Harris Administration." CMS also announced that it will release more information on current GPDC model participants in an effort toward greater transparency. The agency is looking to improve quality of patient-centered care during this year and in the future. Participation in the ACO REACH Model will begin on January 1, 2023. Providers currently participating in the GPDC Model must agree to meet all the ACO REACH Model requirements by January 1, 2023. CMS described its commitment to strengthening health system transformation by focusing on equitable outcomes, 'In ACOs, physicians and other health care providers join together to take responsibility for the quality of care their patients receive and the total costs of that care. These responsibilities encourage providers to coordinate the services across clinicians and care settings. The Affordable Care Act (ACA) created the Medicare Shared Savings Program, CMS' largest ACO initiative, to provide beneficiaries in Traditional Medicare the opportunity to receive care that meets the full range of their needs. ACOs work to improve chronic disease management, ensure smoother transitions from hospitals to homes, and promote preventive care that keeps patients healthy." The ACO REACH Model will implement five new policies to promote health equity starting in PY2023: Health Equity Plan Requirement Health Equity Benchmark Adjustment Health Equity Data Collection Requirement Nurse Practitioner Services Benefit Enhancement Health Equity Questions in Application and Scoring for Health Equity Experience. [FN11] Largest Medicare ACO has 10-Year Anniversary The largest and most successful Medicare ACO had its 10-year anniversary in April 2022. The National Association of ACOs (NAACOS) celebrated with a social media campaign centering the ACO. The Medicare Shared Savings Program initiated its first accountable care organizations (ACOs) on April 1, 2012. Twenty-seven organizations participated with over 375,000 beneficiaries living in 18 states. Ten years later, the Shared Savings Program has grown to 483 ACOs serving 11 million beneficiaries throughout the United States. It is now the largest alternative payment model for Medicare. NAACOS launched a social media campaign aimed at celebrating the ten-year anniversary of the Medicare Shared Savings Program and at spreading awareness and support for the ACO as the leading value-based care program under Medicare. The organization will use the hashtag #HappyBirthdayMSSP. It will share highlights from the program throughout April 2022. NAACOS has also published a communications toolkit to help other organizations and individuals share stories in support of the MSSP. The organization will encourage others to look back on the last decade of the program. 'Celebrating the 10-year anniversary of the MSSP, highlighting the program's successes, and reflecting on lessons learned provides an important opportunity to engage both beneficiaries and providers in a conversation about accountable care," said Clif Gaus, Sc.D., NAACOS President and CEO. 'If CMS wants to improve the quality of care and bend the cost curve, we must grow ACO participation. Since 2012, ACOs have led to significant savings for the Medicare program. They have accumulated $13.3 billion in gross savings and $4.7 billion in net savings. According to data, MSSP ACOs provide high quality care to Medicare beneficiaries while saving the program money. MSSP ACOs achieved an average quality score of 97.8 out of 100 in PY 2020. Eighty-three percent of MSSP ACOs saved money for the Medicare program. They generated $4.145 billion in savings compared to their benchmarks. In 2020, the program had its best year to date. The MSSP is the largest total cost of care model in Medicare. It currently serves almost one third of traditional Medicare beneficiaries. The CMS Innovation Center set a goal last year to transition all traditional Medicare beneficiaries to a provider working through an accountable care payment system by 2030. The agency indicated that beneficiaries need education about the realities of accountable care relationships. They also need to educate providers about the potential value of participating in ACOs. [FN12] HHS Secretary Comments on Medicare Physician Fee Schedule THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. During a press conference, Unites States Department of Health and Human Services (HHS) Secretary Xavier Becerra indicated interest in reforming the Medicare Physician Fee Schedule. 'I'm definitely interested, because | remember those 'cliffs' when | was in Congress,' Becerra said in a briefing with a small group of health reporters, referring to his time as a House member when Congress had to vote each year to stave off a mandated cut in physician payments under the Medicare program. 'We always had to deal with those, and you'd never want professionals ... thinking that there's another profession for them down the line because they're just not making ends meet where they are. So we'd like to be supportive.' The agency is also interested in new ways to increase the number of physicians in the United States serving Medicare beneficiaries. 'And we're trying to drive more of those professionals into the areas that have had a scarcity' of health professionals. The Medicare Payment Assessment Commission (MedPAC) recently recommended that physicians shouldn't receive a Medicare Physician Fee Schedule update in 2023. Becerra indicated, 'We'll take a close look where we can. We just put out ... resiliency funding to help a lot of providers whose workers have been over-stressed, whether they use it to increase compensation, whether it's giving [clinicians] time off, whether it's providing additional training, we gave them the flexibility, but what we are doing is trying to increase the capacity in the healthcare sector for providers to adequately compensate their workforce.' [FN13] The American Medical Association (AMA) recently sent a letter to congressional leaders asserting that the Medicare Payment Advisory Commission (MedPAC) report sent to Congress contains flawed analyses. The MedPAC report recommended keeping the current freeze in Medicare physician fee payments. According to AMA, the report ignored important trailing indicators, including the impact of the COVID-19 pandemic on healthcare providers. In 2020, Medicare physician fee schedule spending decreased by $13.9 billion as patients delayed treatments due to the pandemic. Due to burnout and workload as well as fear of COVID-19 infection, one in five physicians are considering leaving the practice within the next two years. [FN14] Illinois Bill Aims to Incentivize Improved Nursing Home Care The Illinois legislature passed a bill that aims to reward Medicaid-funded nursing homes for improving the quality of care for residents. The bill would grant over $700 million annually toward the program to increase staffing levels. It passed unanimously in the Illinois House after passing in the Senate. Gov. JB Pritzker is expected to sign the bill. He praised its passage in a statement released after the House passed the legislation. Illinois nursing homes have had issues for many years with understaffing, a problem that became worse during the first years of the COVID-19 pandemic. Long-term care facilities experienced high transmission rates of the disease. According to the Illinois Department of Public Health, almost 8,000 nursing home residents and 100 staff members have died of COVID-19, representing approximately 24 percent of all COVID-19 related deaths in the state. The Department of Healthcare and Family Services administers Medicaid. Officials indicated that many of the COVID-19 deaths were the result of understaffing and poor quality of care in nursing homes funded by Medicaid. Facilities that serve low-income residents and people of color were particularly hard hit. 'Imagine ourselves in the year or two prior to COVID, and if we had known it was coming, whether we would have considered resident safety, room crowding, and staffing to have been urgent issues," HFS Deputy Director Andy Allison indicated to a legislative committee in the Fall of 2021. 'We lost ? this is hard for me ? thousands in our nursing homes. | don't think there's anyone in the country who would not at that point have said, this is urgent. And | think the point is nothing has changed, except that now we know just how bad it can be." The pandemic spurred HFS to create a new funding model to address issues and inequities. The payment reform model would reward nursing facilities for increasing staff levels. It would also increase funding to raise wages for certified nursing assistants. Those employees directly care for residents. The new system, Patient Driven Payment Model (PDPM) has been at the center of negotiations between state agencies, advocates for nursing home residents, and the nursing home industry. The ultimate agreement was represented in the recent legislation. House Majority Leader Greg Harris, D-Chicago, announced the successful legislation. 'It's a big victory, and it will bring a lot more accountability to the long-term care industry," Harris stated. A large part of the funding for the plan ($515 million) will come from increases in bed tax state levies on nursing facilities. The money will then go toward drawing additional matching funding from federal Medicaid money. A large portion, $360 million, would go toward incentive payments to nursing homes to increase staffing levels. The state will set targets for staffing levels based on the Staff Time and Resource Intensity Verification or STRIVE study of the federal Centers for Medicare and Medicaid Services. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. Facilities reaching 75 percent of STRIVE targets will receive incentive payments. The payments will increase incrementally with each full percentage point toward staffing goals. Facilities will receive a maximum incentive of $38.68 per patient per day. An additional $85 million would go toward wage increases for CNAs. The annual increases would be based on experience. People with one year of experience would receive a $1.50 per hour wage increase. The annual increases would max out at an additional $6.50 per hour with six hours or more of experience. The remaining $70 million would go toward rewarding facilities for improvements in quality measures. Combined state and federal funding of an additional $202 million will increase the base per-day reimbursement rate the state pays nursing homes by $7 to a total of $92.25 per resident per day. Facilities serving an above average percentage of Medicaid payments receive a bonus of an additional $4 per day. [FN15] NY Governor Announces Investment in Payment Reform Efforts New York Governor Kathy Hochul announced a multi-year healthcare investment including payment reform efforts in the FY 2023 State Budget. The investment will encompass a historic $20 billion in funding. The effort will be aimed at creating better working conditions for healthcare workers. $1.2 billion will go toward frontline healthcare worker bonuses. $4.5 billion over multiple years will go toward payment reform. $2.4 billion will be directed toward improving healthcare infrastructure. $3.9 billion will assist hospitals in recovering financially from the strain of the COVID-19 pandemic. An additional will be earmarked for increasing the minimum wage for home care workers by $3. The investments are an effort to improve working conditions and increase the healthcare workforce by 20 percent over the next five years in New York. 'New York depends on a strong, stable and equitable health care system and at the very foundation are the industry's workers, who've been asked to do the impossible and are continuing to do so two years after the start of the pandemic,' Governor Hochul said. 'This Budget includes historic investments that will rebuild the health care economy by raising health care worker's pay, improving their workplace infrastructure and providing incentives that will attract more people to the workforce. | thank Majority Leader Stewart-Cousins and Speaker Heastie for their work to ensure we are building the health care economy of the future." [FN'16] Report: Billions Needed to Modernize Healthcare Infrastructure A recent report from the Healthcare Information and Management Systems Society indicated that a total investment of approximately $36.7 billion over the next ten years is necessary to modernize State, Territorial, Local and Tribal (STLT) public health infrastructure. The funding is needed to ensure readiness for ongoing and emerging public health emergencies and improve quality of care. Researchers noted that the COVID-19 pandemic and Public Health Emergency have highlighted the need for funding to improve STLT public health data infrastructure. The Public Health Information and Technology Infrastructure Modernization Funding Report showed a need for $25.6 billion for immediate STLT public health data infrastructure and $11 billion for public health interoperability and sustainability. 'Local-to-global communities can benefit immensely from modernization, especially during public health crises and in preparing for future crises," said Valerie Rogers, Director, Government Relations. 'The proposed 10-year, $36.7 billion investment to strengthen our public health information infrastructure ensures our ability to produce more meaningful data yielded by secure, interoperable, integrated systems supporting public health officials, healthcare agencies and policymakers in making informed decisions to rapidly respond to health threats arising from resistant infectious diseases as well as the impacts from global climate shifts and natural disasters. These investments also support our national Healthy People 2030 goals to address health inequalities and persistent chronic conditions." HIMSS recommended the creation and coordination of simplified and secure access of multi-modal health data across virtual, remote, or in-person services to transition by 2030. It also recommended establishing a nimble rapid cycle learning health system environment to aid with improving health outcomes. Priority should be given to collecting the demographic data needed to effectively document then manage inequities and disparities data. Recommendations for modernization of public health data systems and services included digitization of the public health infrastructure with cloud-based services; standardization supporting greater interoperability across the spectrum of care; and innovation supporting the transformation of STLTs to adopt new business processes. These moves are also aimed at combatting health crises and health equity issues. Future needs for improving healthcare quality and equity include the capacity to analyze and share electronically transmissible visualized data and insights to support health equity related issues such as pandemic response, digital health literacy, expanded THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -10- access to care via telehealth and remote patient monitoring and health equity including maternal mortality surveillance, disease reporting and digital patient engagement. 'In 2010, the Public Health Community was asked to wait its turn for a chance of modernization while hospitals and providers received more than $35 billion in direct funding," said Tom Leary, Senior Vice President and Head of Government Relations. 'The COVID-19 pandemic has demonstrated we can't wait any longer. The $1 billion in funding that has been invested by Congress since March 2020 has many benefits. To truly ensure public health is an equal partner with the U.S. clinical environment, we need a responsible approach to investment in STLT public health infrastructure. Our report outlines the areas of investment that will bolster public health throughout the U.S. It will have immediate and long-term benefits for all STLT communities." The investment of $36.7 billion over ten years would focus on digitizing, modemizing, and facilitating interoperability throughout the STLT public health data infrastructure to address essential public health functions and prioritizing quality of care improvements. [FN17] Colorado: Payment Reform Legislation Focuses on Lessening Administrative Burden A bill introduced in the Colorado legislature aims to reduce the administrative burden for healthcare providers participating in payment reform systems. Representative Chris Kennedy co-sponsored the bill along with Representative Yadira Caraveo. Representative Kennedy recently released a statement and wrote an editorial addressing payment reform efforts in the state and the pending legislation. He pointed to the Colorado State Innovation Model (SIM) that used federal grant funding to advance value-based payment systems and assist 344 healthcare providers to implement payment reform for behavioral and physical health care from 2015 to 2019. He credited the Hospital Transformation Program (SB17-267) and the Primary Care Payment Reform Collaborative (HB19-1233) with meaningfully advancing conversations about paying for value over volume. The funding that became available due to the federal American Rescue Plan Act (ARPA) prompted Representative Kennedy to create a bill that would utilize the funding efficiently to promote payment reform efforts. House Bill 22-1302 aims to use $32 million of ARPA funding to help primary care practices integrate behavioral health services and move toward value-based payments. The second part of the issue became conflicting requirements of health insurance plans when implementing payment reform systems. Insurance companies have different requirements for their alternative payment model (APM) contracts with healthcare providers, leading to a higher administrative burden. House Bill 22-1325 would 'require alignment between insurance carriers of certain APM parameters to reduce administrative cost and simplify the work of primary care providers so they can spend less time dealing with insurance companies and more time focusing on their patients," according to Kennedy. He continued, 'Together, these efforts build the foundation of a universal primary care system in Colorado that will provide more efficient, whole-person care that will make people healthier and save them money by reducing the need for expensive hospital care and prescription drugs." IFN18] Value Based Care on Track to Represent Over Half of Home-based Healthcare Value-based care is on track to account for over half of the business of home healthcare providers within the next three to five years, according to a recent survey. Some industry experts reported that less than 5% of current home healthcare business is under value-based contracts. According to the recent survey, 42% of healthcare providers predicted that value-based contracts will cover over half of their business within the next five years. AlayaCare and HHCN conducted the survey. 'I still think we're very much in the early days and very much in the infancy of it," Allan Levine, the SVP of growth and revenue at Newvon, said. 'What | got out of the survey was that right now, a lot of organizations are in the process of figuring out the how and what it means to them. There's a few organizations that are leading the charge and further along. But the bulk of the industry is in listening mode, in Step 1 or 2 of the process." Nevwvon is a home health training and certification platform in New York City. Most of the healthcare providers surveyed reported that value-based payments currently account for very little of their revenue. Home-based healthcare providers predict that payment reform will significantly affect home healthcare financially and clinically in the near future. They also predict that the implementation of payment reform will lead to an increase in mergers and acquisitions in the field. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -11- Sixty-three percent of providers indicated that they are uncertain or indifferent about the impact payment reform has made on the industry until now. They reported that it will likely have a significant effect going forward. '| think a lot of agencies are in that fact-finding stage to see where they stand," Charles Breznicky, a clinical director at SimiTree said. 'One of the stats that | had seen that stood out was regarding the tracking of the client satisfaction ? 69% of providers saw that as extremely important. - That's always an area that agencies want to work on. But it can be hard to put plans in place to really address that." The Home Health Value-Based Purchasing (HHVBP) Model will be implemented throughout the United States in 2023. Home healthcare providers will need to become more familiar with the general concept of payment reform after this model is implemented. Providers will need to pay attention to factors that will negatively affect their payment under value-based systems. The survey revealed that some aspects of payment reform will be most important, including tracking client satisfaction and sharing data between facilities. 'There's a few themes that are resonating, including the focus on interoperability and data," Levine said. Home health professionals also emphasized the growing importance of scheduling and route optimization for clinicians transitioning to payment reform systems. Another important factor is staffing in home-based care. Workers depend on convenient visit schedules. Providers need to schedule employees efficiently to maximize profits and quality of care. 'It's almost like the elephant in the room, that there is a massive labor shortage right now," Naomi Goldapple, the VP of AlayCare's AlayaLabs, said. 'It's super important to be able to leverage technology and wearables. If we're having trouble hiring caregivers, and attracting them and retaining them, then that's kind of further down the food chain. But | think the schedule and route optimization will help to make scheduling and the use of these precious resources more efficient." [FN19] Data Sharing Improvements Needed for Payment Reform Efforts A recent article emphasized the need for more efficient and transparent data sharing methods to improve the transition to value-based care models in healthcare throughout the nation. According to Lynda Rowe, senior advisor of the value-based systems at Intersystems, value-based care models allow providers to offer more services to patients, such as transportation to treatment. However, the transition presents challenges for healthcare providers. 'It's a very big change, especially for providers, and people often overlook the changes in workflow, the changes in thinking, the changes in organizational structure, how you think about care for patients; that's very different under this model than it was under fee- for-service," Rowe said. Providers face a barrier to value-based care because of data sharing. 'Under HIPAA, you can only share data for treatment, payment, and operations, and it has to be specifically on a need-to-know use- case basis," Rowe noted. 'So, for a payer to contract with a provider around value-based care, it actually means they have to change their data use agreement to make sure that all the data they need to get from the provider to help them will come in their direction and vice versa," she said. 'The payer needs to be able to share back cost and utilization information in a timely manner which, by the way, for a payer is incredibly hard to do." Data sharing problems lead to delays in feedback and problems for providers receiving payment under a value-based system. Rowe indicated that data delays can prevent providers from knowing how much they earned for up to 18 months after the end of the year. [FN20] Organization Submits Letter to CMS Regarding Pathways to Payment Reform The American Society for Radiation Oncology (ASTRO) submitted a letter to the Centers for Medicare and Medicaid Services' (CMS) in response to the proposed rule that would indefinitely postpone the start of an alternative payment model for radiation oncology, also known as the RO Model. The group recommended an outline of actionable steps toward a value-based payment model that would stabilize reimbursements to Medicare providers, prioritize health equity, and reduce unnecessary administrative burdens. According to the organization, transitioning to payment reform systems would also improve outcomes for people with cancer. ASTRO also issued a statement from Laura A. Dawson, MD, FASTRO, Chair of the ASTRO Board of Directors: 'The recent decision by CMS to indefinitely delay the RO Model creates a renewed opportunity for the agency to work with radiation oncology stakeholders and establish a radiation oncology payment reform initiative that will lead to better outcomes, higher quality and greater equity in cancer care, while still reducing costs for Medicare and patients. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -12- Since CMS introduced the proposed RO Model nearly three years ago, ASTRO has consistently called for modifications to address concerns from a bipartisan coalition of legislators and the cancer care community. These concerns include prioritizing model savings over quality improvement; mandatory participation that goes far beyond any other untested CMS model; an outdated and unnecessarily cumbersome payment methodology; and overly burdensome reporting requirements. Worse, by creating disproportionate risk for providers who care for people from socioeconomically disadvantaged communities, the model would jeopardize these patients' access to high-quality care and exacerbate health disparities. An overemphasis on demonstrating absolute savings under the model sacrifices achievable goals of quality improvement and payment stability. Nonetheless, ASTRO believes these worthy goals remain within reach, and we are committed to working with CMS and Congress on a new payment reform initiative that would contribute to President Biden's strategy to reduce cancer mortality and improve the lives of people with cancer." The American Society for Radiation Oncology (ASTRO) has almost 10,000 members who are physicians, nurses, biologists, physicists, radiation therapists, dosimetrists and other health care professionals who specialize in treating patients with radiation therapies. [FN21] CareMax Purchases Value-Based Care Arrangements CareMax closed its purchase of Steward's value-based care network, indicating that it would cover a total of 205,000 senior beneficiaries living in ten states under value-based care arrangements. CareMax is a publicly traded value-based care provider. The company announced acquisition plans that will include over four times its current number of covered seniors in value-based care plans. The company will acquire Steward Health Care System's Medicare value-based care business for cash and stock with a value of approximately $135 million. The deal will most likely close during the late third or early fourth quarter of 2022. CareMax will become the only management services organization across Steward's network of about 171,000 patients. The deal will affect 1,800 health care providers in eight states. Currently, the company covers about 34,000 senior beneficiaries over 200 health care providers and three states. The company indicated to investors that the deal will bring opportunities to generate additional cash flow. It will transition Steward's 387,000 Medicare Advantage fee-for-service patients and 482,000 traditional Medicare fee-for-service beneficiaries into at-risk capacitated arrangements. "We are excited to announce the acquisition of Steward's Medicare value-based care business, which will enable us to significantly accelerate our growth by bringing CareMax's best-in-class, proprietary value-based care model to the communities in which Steward's value-based care business operates," Carlos de Solo, CEO of CareMax, said. 'We plan to deploy our current [management services organization] model, which we've been operating since 2011, to improve quality of care, health outcomes and wellbeing for seniors across eight states, while reducing overall healthcare costs." Steward Health Care System is based in Dallas. It currently operates in nine states. It is one of the largest accountable care organizations in the United States. Its integrated system spans 39 hospitals and 326 practice locations, with more than 6,600 providers and 43,000 employees delivering services to 12.3 million patients annually. 'Steward was founded to provide top-quality healthcare to communities that have historically been medically underserved," Ralph de la Torre, M.D., CEO of Steward, said. 'CareMax is a like-minded organization with a talented management team and the assets and expertise in place to move our mission forward. We believe that our physician-led, integrated health care system with a network of over one million Medicare beneficiaries coupled with CareMax's proprietary, industry-leading clinical model will deliver the next generation of healthcare in this country." N21 CMS Announces Enhancing Oncology Model The Centers for Medicare & Medicaid Service's (CMS) Innovation Center announced a new, voluntary Enhancing Oncology Model (EOM) aimed at improving care for patients and reducing spending. According to CMS, 'It is designed to test how best to place cancer patients at the center of the care team that provides high-value, equitable, evidence-based care. EOM aims to improve care coordination, quality, and health outcomes for patients while also holding oncology practices accountable for total costs of care to make cancer care more affordable and accessible for beneficiaries and Medicare, which are key priorities described in the CMS Innovation Center's strategy refresh." The new payment model aligns with President Biden's Cancer Moonshot objectives, including supporting patients, caregivers, and survivors, and addressing inequities. The Biden-Harris Administration set a goal in February 2022 for the Cancer Moonshot of reducing the cancer death rate by at least 50% over the next 25 years. The program is also focused on improving the experience of cancer patients and their families. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -13- In an effort to improve health equity, CMS is encouraging oncology practices serving underserved patients to apply for the EOM. The equity strategy will include: -requiring oncology practices to screen for health-related social needs (HRSNs), -introducing data reports on expenditure and utilization patterns of their patient population to help health care professionals identify and address health disparities, - and offering an additional payment for the provision of Enhanced Services to patients who are dually eligible for Medicare and Medicaid. Additional payments for dually eligible patients will not be part of the practice's total cost of care responsibility. The payment model stands on advances made through the Oncology Care Model (OCM) which will be active from July 1, 2016- July 1, 2023. It also builds on feedback from the oncology community, including OCM participants, patient advocacy groups, oncology professional associations, and others. The payment model will begin on July 1, 2023 and run for a five-year period. It will be a multi-payer model promoting a consistent approach to payment reform. Applications for the program will begin on June 27, 2022 and close September 30, 2022. Applications are available through the CMS Innovation Center website. The performance period for the model will begin in July 2023 and end June 2028. Under Section1115A of the Social Security Act (the Act) (added by Section 3021 of the Affordable Care Act) (42 USC ? 1315a), the Innovation Center has the authority to test innovative payment and service delivery models. The models aim to reduce expenses for Medicare, Medicaid, and the Children's Health Insurance Program (CHIP). They also focus on preserving and improving the quality of care for beneficiaries. Traditional Medicare fee-for-service payment systems paid health care providers for each item or service separately during cancer treatment. According to CMS, 'This creates a financial incentive for some providers and suppliers to increase the volume of items and services or prescribe high-cost, but not necessarily higher value drugs. These actions may adversely affect the beneficiary with cancer and the Medicare program." Traditional cancer care has also focused on treating the disease and not the person, which resulted in fragmented care and limited coordination of care among providers. EOM aims to shift focus to value-based, patient-centered care for cancer patients undergoing months-long treatments, in episodes of care lasting six months. Participants in EOM will receive incentives for considering the whole patient and engaging proactively with the patient throughout treatment, including between appointments. These key learnings from OCM will be incorporated into EOM. Under EOM, participants will be rewarded for improving quality of care by implementing participant redesign activities. Some of these activities were successfully implemented through OCM, including patient navigation and care planning. Some are new, including the gradual implementation of electronic Patient-Reported Outcomes (ePROs) and activities that promote health equity. CMS indicated, 'The central goal of EOM is to better support patients and improve their care experience." Improving communication with providers through EOM will likely lead to more communication between appointments for beneficiaries who have questions for their care providers. Additional potential improvements include enhanced, patient-focused services like 24/7 access to clinicians with real-time access to patient medical records. Improvements in patient navigation services and support services will also enhance care and treatment. Detailed planning would involve discussions with patients about prognosis, treatment options, symptom management, quality of life, and psychosocial health needs, in addition to other relevant issues. Patients will not be responsible for cost sharing for any part of the enhanced services under EOM. Another important part of EOM will be the ability of beneficiaries to provide feedback for their overall cancer care experience and health outcomes, including symptoms, physical functioning, and behavioral health. Feedback will be accessible electronically. Patients will receive screening for health-related social needs, such as nutrition during treatment, and access to transportation to infusion appointments. CMS noted, 'The data sharing requirements between EOM participants and CMS will also allow for a better understanding of patients' information to address inequities and learn more about targeting the right treatments." [FN23] CMS Releases Proposed Physician Payment Schedule Rule Changes The Centers for Medicare & Medicaid Services (CMS) recently released the Calendar Year 2023 Physician Fee Schedule (PFS) proposed rule. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -14- The rule aims to significantly expand access to behavioral health services, Accountable Care Organizations (ACOs), cancer screening, and dental care. It focuses on expanding these services especially to rural and other underserved areas. 'At CMS, we are constantly striving to expand access to high quality, comprehensive health care for people served by the Medicare program," said CMS Administrator Chiquita Brooks-LaSure. "Today's proposals expand access to vital medical services like behavioral health care, dental care, and cancer treatment options, all while promoting access, innovation, and cost savings in the Medicare program." 'Integrated coordinated, whole-person care - which addresses physical health, behavioral health, and social determinants of health - is crucial for people with Medicare, especially those with complex needs," said Dr. Meena Seshamani, CMS Deputy Administrator and Director of the Center for Medicare. 'If finalized, the proposals in this rule will advance equity, lead to better care, support healthier populations, and drive smarter spending of the Medicare dollar." Under the rule, the proposed CY 2023 PFS conversion factor is $33.08, which represents a decrease of $1.53 to the CY 2022 PFS conversion factor of $34.61. According to CMS, 'This conversion factor accounts for the statutorily required update to the conversion factor for CY 2023 of 0%, the expiration of the 3% increase in PFS payments for CY 2022 as required by the Protecting Medicare and American Farmers From Sequester Cuts Act, and the statutorily required budget neutrality adjustment to account for changes in Relative Value Units." The rule also includes a proposal to bundle certain chronic pain management and treatment services into new monthly payments. This change is aimed at improving patient access to team-based comprehensive chronic pain treatment. The rule will include changes to the Medicare Shared Savings Program seen as 'some of the most significant reforms since the final rule that established the program was finalized in November 2011 and ACOs began participating in 2012" The changes aim to expand access to accountable care organization (ACOs). The Medicare Shared Savings Program covers more than 11 million people with Medicare. The network is over 500,000 providers. As noted by CMS, 'Building on the CMS Innovation Center's successful ACO Investment Model (AIM), CMS is proposing to incorporate advance shared savings payments to certain new Medicare Shared Savings Program ACOs that could be used to address Medicare beneficiaries' social needs. This is one of the first times Traditional Medicare payments would be permitted for such uses, and is expected to be an opportunity for providers in rural and other underserved areas to make the investments needed to become an ACO and succeed in the program." Additional proposals include allotting more time for smaller ACOs to transition to downside risk. This change will help to increase participation in rural and other underserved areas of the country. Another proposal is a health equity adjustment to an ACO's quality performance category score. This change will reward providers for providing excellent care to underserved populations. The final change relating to ACOs involves benchmark adjustments to encourage more ACOs to participate and succeed. According to CMS, this 'would help achieve the goal of having all people with Traditional Medicare in an accountable care relationship with a healthcare provider by 2030." FN24I Organization Issues Response to Proposed Changes to Physician Fee Schedule National Association of ACOs (NAACOS) President and CEO Clif Gaus, Sc.D. released a response praising the Centers for Medicare and Medicaid Services for the Proposed 2023 Medicare Physician Fee Schedule. 'NAACOS sends a big bravo to the Centers for Medicare and Medicaid Services (CMS) for taking steps to reach its goal of creating a stronger Medicare by strengthening accountable care models and speed the movement toward value for all patients. While we are still studying the major changes, policies in today's proposed Physician Fee Schedule will help grow participation in accountable care organizations (ACOs), helping realize the CMS Innovation Center's recent Strategy Refresh to have every Medicare beneficiary in a relationship with a provider accountable for his or her quality and total cost of care by 2030. 'Importantly, CMS projects today's proposed changes would save Medicare more than $15 billion and yield $650 million in higher shared savings payments to ACOs. We know the most successful alternative payment models (APMs) are when providers are held accountable for patient outcomes for the entire year, as ACOs do.' The organization listed the following proposed changes: Give ACOs more time before advancing to the highest levels of risk; Make fairer, more accurate financial benchmarks for ACOs by incorporating a prospectively projected administrative growth factor; Add a health equity quality adjustment for high quality performance in ACOs with high underserved populations; Provide advance shared savings payments to smaller ACOs that serve underserved populations; Account for an ACO's prior savings in rebased benchmarks to help mitigate the lowering of an ACO's benchmark over time; and Make positive changes to quality scoring approaches. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -15- 'NAACOS thanks both the Biden administration and congressional champions of ACOs for their leadership on changes in today's rule. We will continue to work closely with CMS and Congress on additional necessary changes such as extending the 5 percent Advanced APM bonus, which expires this fall.' N?°l Skilled Nursing Largely Left Out of Payment Reform Changes Recent proposals from the Centers for Medicare & Medicaid Services (CMS) will bring significant changes to its accountable care organization (ACO) model, however skilled nursing will not see a lasting impact from the changes. ATI Advisory Managing Director Fred Bentley indicated that only operators with their own physician group may be able to form their own ACO more easily. He predicted that SNF participation could increase with the ability to qualify for advanced savings and a slower transition to taking downside risk. ACOs already involve upside risk. 'It starts to tip the scale a little further in terms of or making it that much more enticing to join," noted Bentley. 'I think there are a subset of long-term care organizations that are interested in doing more than just partnering, which really to date has not been a winning proposition." Proposed changes to ACOs include advance payments for social services, changes to performance quality scores and benchmark adjustments. CMS released the proposals in the Physician Fee Schedule (PFS) in early July. 'From the skilled nursing operators' perspective, this just underscores that ACOs are permanent fixtures," said Bentley. 'I think most skilled nursing operators knew that, but this reinforces that." Jill Sumner, vice president of population health management for the American Health Care Association (AHCA), pointed to proposed changes as a possible catalyst for ACOs to engage with the skilled nursing industry. 'To date, there are very few, three only, ACOs that we know of that are really engaged meaningfully with providers around their long- term care population," Sumner indicated. According to Sumner, most ACOs collaborate with SNFs to collect metrics and put management techniques in place to reduce the length of stay as well as access to care. They usually do not create an advanced primary care model in the nursing facility. She would rather that CMS contract directly with nursing facilities. Currently, CMS contracts with physician groups under ACO models. Bentley expressed concern that the expansion of the ACO program will lead to constraints on utilization and spending for nursing homes. CMS is signaling through the proposed changes that it supports payment reform efforts and wants to increase participation. Mark Besch, senior specialist for government affairs and analytics at Aegis Therapies indicated that nursing homes have an opportunity to negotiate for better rates and extended care delivery on location with CMS's push to cover more beneficiaries under payment reform. Understanding ACO guidelines and advocating for the nursing home industry are important because ACOs manage care carried out in the nursing facilities, Besch noted. 'CMS has a desire to have a large percentage of the traditional [Medicare fee-for-service (FFS)] beneficiaries involved in ACOs. The more ACOs that CMS facilitates, the larger that percentage becomes," Besch said. He pointed out a need to increase the number of Medicare Part A SNF admissions covered by an ACO. '| think we need to encourage CMS to continue to report on the qualitative outcomes from the ACOs," Besch said. 'They're quick to report on the dollar savings ? which we get, it's part of the shared savings program, but - the qualitative results from ACOs should be front and center, or at least equivalent to any cost savings motivation." [FN26] Research Highlights Importance of Payment Reform for Rural Areas Recent research has shown the importance of payment reform for hospital systems in rural areas, leading to funding from the federal government for projects like the Pennsylvania Rural Health Model. The $35 million grant will cover a six-year project modeling payment reform to fund healthcare aimed at improving patient health while also increasing financial stability for rural hospitals and decreasing healthcare costs. In recent years, many rural hospitals throughout the United States have experienced financial distress. Over 130 rural hospitals have closed over the past ten years. People living in rural communities have less access to social networks, healthcare, and long-term care. The result is often poor health outcomes. Dennis Scanlon, distinguished professor of health policy and administration and director of the Center for Health Care and Policy Research, noted that rural health is particularly relevant to Pennsylvania. Over three million people in the state live in rural areas. Approximately 27% of Pennsylvanians live in rural areas. They often have higher rates of chronic disease, substance use and poverty. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -16- A team of researchers from Penn State's Department of Health Policy and Administration, Center for Health Care and Policy Research, and Pennsylvania Office of Rural Health reported results from a study of the new model created in 2019. They recently published their findings about the new healthcare payment model in Journal of Healthcare Management. 'The [traditional] fee-for-service model is costly, inefficient, and still does not lead to great outcomes for patients," said Scanlon the head of the research project. 'A global budget model allows hospitals to know what their revenue will be, which may provide different incentives to the providers." [FN27] CMS Releases Bulletin on Nursing Care Payment Reform The Centers for Medicare & Medicaid Services (CMS) recently issued an informational bulletin encouraging states to take actions using existing Medicaid authorities toward payment reform to improve outcomes for nursing home residents and make improvements for staff pay, training and retention. CMS' Centers for Medicaid and CHIP Services (CMCS) released the informational bulletin. It included examples of current state Medicaid initiatives to support this effort toward expanding payment reform. The bulletin is part of President Biden's goal of improving the safety and quality of nursing home care. Earlier in 2022, he announced a comprehensive set of reforms aimed at these improvements and making nursing homes accountable for quality of care. Goals include making the quality of care and facility ownership more transparent to allow for improved informed decisions by consumers for residents and their loved ones. CMS indicated that it is working to support state Medicaid agencies in ensuring the highest quality of care for beneficiaries living in nursing homes. 'Our loved ones living in nursing homes deserve the highest quality of care, dignity, and respect," said Health and Human Services (HHS) Secretary Xavier Becerra. 'At HHS, we're taking another critical step to implement President Biden's bold set of reforms to improve our nation's nursing homes. We call on all states to work with us and ensure everyone has access to the high-quality care they deserve." 'Today's action is an important step toward accomplishing the Administration's goals of strengthening the quality of care, accountability, and transparency in our country's nursing homes for Medicaid enrollees. States can implement a number of initiatives described in this guidance immediately," said CMS Administrator Chiquita Brooks-LaSure. 'Medicaid enrollees residing in nursing homes will only experience better care through collaboration between states, CMS, providers, and other partners, and we look forward to working closely with them on this important effort." CMS encouraged states to focus on keeping nursing homes adequately resourced and staffed by linking Medicaid payments to quality measures. Payment reform efforts will improve the safety for patients and quality of care. 'We know that low wages for staff can contribute to frequent turnover and dangerous staffing shortages at nursing homes, so we encourage states to work with these facilities to find solutions for training and improving staffing," said Administrator Brooks-LaSure. CMS also strongly urged states 'to achieve a more equitable balance between the share of spending and use of services and supports delivered in home and community-based settings relative to institutional care like nursing homes." The Biden-Harris Administration called strengthening the availability of Medicaid-covered home and community-based services (HCBS) as an alternative to institutional care a key priority. Under the American Rescue Plan, states can access $25 billion in funding to expand, enhance, and strengthen HCBS. CMS called this funding the largest investment in HCBS to date. The full informational bulletin sent to states is available on the CMS website. It is titled 'Medicaid nursing facility payment approaches to advance health equity and improve health outcomes." [FN28] Article Highlights Necessary Changes to Payment Reform for Health Equity According to a recent article in JAMA Network, action is needed to align value-based payments with health equity. The author noted that, 'A decade of value-based payment policy has done little to reduce health inequity in the US. Despite modest successes in improving quality and cost efficiency, value-based models and alternative payment models can also unintentionally exacerbate inequities encountered by historically marginalized communities." There is agreement about the need to align payment policy with health equity. However, tensions exist between financial incentives and equity goals. The author pointed to the value-based payment mechanism that holds clinicians accountable for total spending. This mechanism is necessary to keep costs in check, however, it could discourage clinicians from providing adequate care for historically marginalized populations. The author asserted, 'Policy makers must systematically address such issues to translate moral imperative into policy reform." The author addressed organizational participation, which has been uneven and has prevented marginalized groups from accessing benefits within payment reform systems. The author suggested requiring participation in payment reform systems to address selective THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -17- participation and bring more populations and regions under payment reform healthcare systems. However, the cost to organizations and competition is a barrier to participation. The author also proposed spending targets 'to drive cost efficiency should encourage participating health care organizations and clinicians to take actions that support, rather than undercut, equity. Doing so may require acknowledgment that lower spending, particularly for marginalized groups, is not always desirable." In addition, value-based payment arrangements should include measurements of inequalities in quality measurement. Racial disparities for certain health conditions should be taken into account when measuring quality of care. Also, similarly, performance-based incentives should include consideration of the available safety net for patient populations served. [FN29] Health Care Providers Ask Congress to Extend Value-Based Incentives Over 800 health care associations, accountable care organizations (ACOs), medical practices, and health systems signed a letter to Congress asking the legislature to extend incentive payments designed to encourage participation in risk-bearing alternative payment models (APMs). The incentives will expire at the end of 2022 without action from Congress. In 2015, Congress created an incentive payment of five percent to incentivize health care providers to try new payment models, including ACOs. Almost 300,000 clinicians are expected to receive the incentive in 2022. However, Congress expected the number of clinicians trying new payment models to be much higher. The letter asked Congress to extend the incentive program to give providers more time to choose to try alternative payment models. These payment reform systems have helped to improve quality of care and lower the cost of care overall. 'Ending these important incentive payments would discourage future participation in models that have seen growing uptake in recent years," the letter states. 'The incentive payments not only encourage physicians and additional health care practitioners to enter models, but also provide additional resources that can be used to expand services beyond traditional fee-for-service." A briefing was scheduled on Capitol Hill about the benefits of the five percent incentives to the healthcare system. The National Association of ACOs (NAACOS) co-hosted the event. Over 800 organizations signed the letter, including nearly 600 medical practices, over 200 ACOs and health systems, and 17 provider associations and coalitions. Signatories included the Alliance for Technology Driven Health, American Academy of Family Physicians, American College of Physicians, American Medical Association, American Medical Group Association, America's Essential Hospitals, America's Physician Groups, Association of American Medical Colleges, Association of Community Cancer Centers, Health Care Transformation Task Force, Medical Group Management Association, National Association of ACOs, National Rural Health Association, Partnership to Empower Physician-Led Care, Premier, Inc., Primary Care Collaborative, and Value Based Care Coalition. The organizations pointed to important services offered to patients that the incentives cover. The money goes toward digital health tools, care coordinators, data analytics, transitional care services, and innovative patient engagement methods. The tools are aimed at improving patient outcomes, quality of care, and satisfaction. The elimination of the incentives could lead to a decrease in the quality of care. 'ACOs, the predominant type of Advanced APM, have used these incentives to fund wellness programs, pay for patient transportation and meals programs, reduce cost sharing for beneficiaries, and hire care coordinators," the letter states. 'These are services that are not typically reimbursed through Medicare but improve patient health outcomes and wellbeing.' ACOs have saved Medicare almost $17 billion in gross savings over the last ten years. Payment reform has netted the program $6.3 billion in savings. Almost 20 percent of all Medicare patients and almost one third of traditional Medicare patients are served by ACOs. Under Medicare, ACOs allow patients to choose their healthcare provider. There are no network restrictions or prior authorization requirements for Medicare beneficiaries, 77] Shared Savings Program Created Savings for Medicare The Centers for Medicare & Medicaid Services (CMS) announced that the Medicare Shared Savings Program saved Medicare $1.66 billion in 2021 compared to spending targets. The savings were a result of working with Accountable Care Organizations (ACOs) consisting of groups of physicians, hospitals, and other health care providers to provide high quality care. It is the fifth consecutive year that the program has generated overall savings and a high standard of care. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -18- 'This program has delivered more than $1.6 billion in savings and delivered high-quality health care to millions of people," said HHS Secretary Xavier Becerra. 'Just last month, we proposed ways to further grow and expand this successful program, especially in rural and underserved communities. The Biden-Harris Administration will continue to do everything we can to strengthen Medicare and ensure everyone can access high-quality, affordable health care." 'The Medicare Shared Savings Program demonstrates how a coordinated care approach can improve quality and outcomes for people with Medicare while also reducing costs for the entire health system," said CMS Administrator Chiquita Brooks-LaSure. 'Accountable Care Organizations are a true Affordable Care Act success story, and it is inspiring to see the results year after year. The Biden-Harris Administration and CMS are committed to a health care system that delivers high-quality affordable, equitable, person-centered care ? and a Medicare program that can deliver just that." Through Shared Savings Program ACOs, healthcare providers collaborate to deliver coordinated high-quality care to Medicare beneficiaries. They focus on delivering timely and correct care and avoiding unnecessary services and medical errors. ACO participants are rewarded for delivering high quality care and spending efficiently. They share in the savings achieved for the Medicare program in the form of performance payments. The Shared Savings Program has become one of the largest value-based purchasing programs in the United States over the past ten [FN31] years. Blue Shield Starts Payment Model Blue Shield of California has created a new value-based, shared savings payment model for specialty care physician practices. The payment model is focused on transitioning specialty care services from traditional fee-for-service payment structures to value- based care. The model will involve an episode of care arrangement. Under each episode of care arrangement, physicians will aim for providing coordinated, collaborative care to patients throughout the health care continuum. The shift is intended to improve quality of care and manage costs. Participating physicians and practices will receive direct financial incentives in the form of shared savings if they improve outcomes for specialty services. The practices will not have any downside financial risk under the payment model. The initial program from Blue Shield will include orthopedic, maternity and gastroenterology services. Blue Shield intends to expand the payment model program to other specialties. Participants in the Blue Shield commercial PPO network will be eligible to join the payment model program. Blue Shield released a series of webinars to assist physicians in understanding the new payment model, including: OB/GYN physicians webinar Gastroenterology specialist webinar Orthopedic surgeon webinar Blue Shield also scheduled several love Q&A sessions for interested physicians with questions about the payment model. [FN32] Practices Treating Minorities More Likely to Leave Medicare Shared Savings Program According to a recent study, accountable care organizations (ACOs) that serve a large percentage of patients from racial and ethnic minority groups are more likely to leave the Medicare Shared Savings Program. Researchers looked at 589 Medicare Shared Savings Program ACOs from January 2012 to December 2018. They found that ACOs with a higher percentage of minority patients were more likely to leave the Medicare Shared Savings Program. Researchers looked at many factors to determine that the increased exit rate was tied to 'significant differences in beneficiary complexity and ACO structure." The data points to a finding that the ACOs serving minority groups are more likely to serve people with complex medical and social needs. Researchers also pointed to recent changes in the payment structures of the Medicare Shared Savings Program as possible factors for the exit of ACOs serving minority populations. These factors might be tied to racial and ethnic disparities with regard to access to ACOs. Under the Medicare Shared Savings Program, healthcare providers receive financial incentives as part of accountable care organizations (ACOs) for reducing the costs of care. According to researchers, 'The structure of the shared savings program may not adequately adjust for challenges associated with caring for patients with high medical complexity and social needs, a population disproportionately made up of racial and ethnic minority groups. If so, ACOs serving racial and ethnic minority groups may be more likely to exit the program, raising concems about the equitable distribution of potential benefits from health care delivery reform efforts." THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -19- Of the 589 Medicare Shared Savings Program ACOs included in the study, the ACOs in the top 25% of proportion of beneficiaries or minority groups were labelled high-proportion ACOs (145). The remaining ACOs in the lower 75% were labelled low-proportion ACOs (444). Researchers noted, 'In unadjusted analysis, a 10?percentage point increase in the proportion of beneficiaries of racial and ethnic minority groups was associated with a 1.12-fold increase in the odds of an ACO exit (95% Cl, 1.00-1.25; P = .04). In adjusted analysis, there were significant associations among high-proportion ACOs between characteristics such as patient comorbidities, disability, and clinician composition and a higher likelihood of exit." Researchers found that the data suggested that ACOs serving a higher percentage of minority beneficiaries of both racial and ethnic groups were more likely to leave the Medicare Shared Savings Program. Researchers reasoned that these ACOs served patients with greater disease severity and complexity. They indicated, 'These findings raise concerns about how current payment reform efforts may differentially affect racial and ethnic minority groups." The Shared Savings Program is Medicare's largest ACO initiative, encompassing 477 accountable care organizations and 10.7 million beneficiaries. Organizations participating in the program take on financial risks as well as the possibility of financial rewards for achieving cost targets annually. The program is voluntary. Participating ACOs can choose to leave the program during any year. The SSP began in 2012. Since that time, about 30% of participating ACOs have voluntarily exited the program. [FNS3] Organization Calls for CMS to Create Pilot Program to Test Data The National Association of ACOs (NAACOS) recently called for the Centers for Medicare & Medicaid Services (CMS) to create a small pilot program to test the reporting of quality data sourced from electronic health records (EHRS). The organization recommended that the small pilot test data prior to transitioning to a program-wide mandate. The recommendation was the focus of a new position paper developed by NAACOS through a task force created to develop recommendations for collecting and electronically reporting on ACOs' quality of care using disparate health information technology (IT) systems. The organization asserted that the full transition to digital quality measurements by 2025 will be difficult for ACOs. CMS has named 2025 as the goal transition date. The task will be difficult due to the dozens of EHR systems that ACOs coordinate, along with many physicians' offices, hospitals, and other health care providers. Health care providers often use different EHRs. NAACOS's 14-person task force of leading ACO innovators developed recommendations for CMS. 'Numerous thought leaders from across a broad swath of ACOs spent months deliberating this issue to develop thoughtful, commonsense recommendations to move our industry to digital quality reporting," said Katherine Schneider, MD, chair of the NAACOS Digital Quality Measurement Task Force and past NAACOS board chair. 'ACOs simply cannot report quality data as easily as a single, standalone health system or physician practice. Different considerations need to be made. NAACOS absolutely supports the need to move to a more digital and less manual form of quality reporting, but more work needs to be done by both government regulators and the health IT industry before this becomes widely possible for ACOs.' The task force also recommended that CMS remove the current requirement that ACOs report data on all patients, even if they are not served as part of the ACO, from all payers. If the requirement is kept, ACOs serving vulnerable populations would be negatively affected. CMS will compare these ACOs with other providers. The ACOs serving vulnerable populations would receive worse ratings because they are serving a sicker population, not because the services they provide are lower quality. According to NAACOS, 'The task force feels the requirement would disenfranchise safety-net providers." The organization recommended: -As CMS and the Office of the National Coordinator for Health IT (ONC) consider the future for digital quality measurement, the goal should be to improve how quality data can be captured to better support patient care at the point of care and appropriately reward high- value care. -The transition to more digital quality measurement must be iterative and build off of previous work and investments. -CMS should provide policy incentives to help offset the significant initial and ongoing costs associated with transitioning to electronic clinical quality measures and digital quality measures. -CMS must enable the successful matching of patients across different providers and EHRs, and EHR certification criteria must support ACOs in eCQM and digital quality measure (dQM) reporting. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -20- A NAACOS survey showed that 39 percent of ACOs have over 10 EHRs and 17 percent have one EHR. Many ACOs pay third-party companies to aggregate data, adding cost to their healthcare practices. [FN34] Report Categorizes Participation in Value-Based Payment Models A new report showed that healthcare providers participating actively in value-based care payment see more patients, have more experience, and are more open to increasing their panels. Researchers analyzed survey data to reveal what enables primary care physicians (PCPs) to actively participate in value-based care. The survey included answers from over 300 PCPs across the United States. They focused on current practices and anticipated trends in value-based care. Researchers noted, 'While value-based care has become a well-recognized way to align economic interests with activities that should improve patient outcomes and reduce unnecessary spending, ensuring that physicians can deliver against a value-based care mandate is another matter." They categorized PCPs to better assess how the degree of alignment to value-based care affects their practice, decision-making, and competencies: -Leaders: those who are actively participating in capitation models within their practice -Experimenters: those who participate in some other form of value-based care model (e.g., accountable care organizations) -Abstainers: those who either don't participate in any value-based care contracts or are unaware whether they do The leaders were more experienced, cared for more patients per day, and were more open to growing their panels. These PCPs also worked fewer hours per week than experimenters or abstainers even though they saw more patients. Leaders demonstrated increased alignment with the payment models. They also 'were more likely to receive performance-based compensation, know and consider cost when referring patients, and were more likely to successfully drive patients to specific health plans or products." [FN35] Organizations Form Group to Support Payment Reform Six United States healthcare organizations created a coalition to support federal policies in favor of payment reform in healthcare. The Alliance for Value-Based Patient Care has asked Congress to extend Medicare incentives for healthcare providers including physicians, clinicians, medical groups, and health systems to prioritize quality care that results in better outcomes for patients while also lowering healthcare costs. The incentive to join value-based care under Medicare was a provision in the bipartisan Medicare Access and CHIP Reauthorization Act. The law passed Congress with very strong bipartisan support in 2015. However, without Congressional action, the incentive for value-based payment will end on December 31. Members of the Alliance for Value-Based Patient Care include: -American Medical Association -American Medical Group Association -America's Physician Groups -Health Care Transformation Task Force -National Association of ACOs -Premier, Inc. Members of the group predicted that a failure of Congress to extend Medicare's incentive for value-based care could end a decade of progress on healthcare system improvements in December. The incentive is a five percent bonus for providers participating in Advanced Alternative Payment Models under Medicare's Quality Payment Program 'Patients and the healthcare system in the United States quite literally cannot afford to return to the days before Medicare incentivized healthcare providers for generating good results," said Clifton Gaus, CEO of the National Association of ACOs. 'Congress must continue the movement toward value-based care to boost quality and control costs. The best way to transform healthcare is for Congress to take action to support value-based care before the end of the year." Currently, about 300,000 physicians participate in Medicare's incentive for value-based care. They use the incentive to support measuring and reporting progress on quality measures, coordinating care among multiple clinicians, and addressing social determinants of health. Projections from the Centers for Medicare & Medicaid Services indicate that one third of participating physicians could exit the value- based care models is the incentive expires at the end of the year. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -24- Value-based care systems serve millions of patients in the United States. Over 30 million patients receive care from accountable care organizations, a type of advanced alternative payment system. According to the National Association of Accountable Care Organizations, 'Value-based care models have been shown to mitigate growth in healthcare costs. ACOs have generated more than $17 billion in gross savings. Coalition members say that extending the incentive for value-based care in Medicare will help sustain the program past 2028, when Medicare's Trust Fund is expected to become insolvent. FN%6] Delaware Names First Director of Value-Based Care The Delaware Department of Insurance appointed Cristine Vogel as its first director of value-based healthcare delivery. The purpose of the position is to create, implement, and monitor affordability standards. Focus areas include increasing primary care investment and managing reporting of carrier investments in healthcare. Vogel will assess commercial reimbursement rates for primary care services and chronic care services. She will also assess the role of cost and utilization in spending. She will look at prescription drug spending as a driver of total cost of care. Delaware has recently taken the following actions to improve healthcare and reduce costs: - Implementing healthcare quality and spending benchmarks; - Creating the Primary Care Reform Collaborative to make recommendations on payment reform, value-based care, workforce and recruitment, and primary care investment and access; - Implementing a state reinsurance program under the federal 1332 waiver program to stabilize the health insurance marketplace; - Issuing regulations to require the registration of pharmacy benefit managers; and - Lifting payment and other barriers to ensure that providers could easily transition to providing telemedicine services, including phone- based visits during the COVID-19 pandemic. In 2019, the Delaware legislature addressed healthcare cost growth by directing the DOI to create the Office of Value-Based Health Care Delivery to 'reduce health-care costs by increasing the availability of high quality, cost-efficient health insurance products with stable, predictable, and affordable rates." The Office has three tasks: 1. Establish affordability standards for health insurance premiums based on recommendations from the Primary Care Reform Collaborative and annually monitor and evaluate these standards; 2. Establish targets for carrier investment in primary care to support a robust system of primary care by Jan. 1, 2025; and 3. Collect data and develop annual reports regarding carrier investments in healthcare, including commercial reimbursement rates for . . . FN37 primary and chronic care services. [FN37] © Copyright Thomson/West - NETSCAN's Health Policy Tracking Service [FN2] . LaPointe, Jacqueline, "Providers Dodged Major Medicare Payment Cuts But More Work To Be Done," RevCycle Intelligence, December 20, 2021, available at https://revcycleintelligence.com/features/providers-dodged-major-medicare-payment-cuts-but-more- work-to-be-done. [FN3] . Hinton, Elizabeth, Lina Stolyar, and Madeline Guth, "State Delivery System and Payment Strategies Aimed at Improving Outcomes and Lowering Costs in Medicaid," KFF, January 12, 2022, available at https://www.kff.org/medicaid/issue-brief/state-delivery-system- and-payment-strategies-aimed-at-improving-outcomes-and-lowering-costs-in-medicaid/. [FN4] . Press release, "Medicare ACO Participation Flat in 2022 NAACOS Issues a Call to Action for CMS to Spur ACO Growth," NAACOS, January 26, 2022, available at https:/Awww.naacos.com/press-release--medicare-aco-participation-flat-in-2022. [FN5] . Press release, "Medicare Shared Savings Program Continues to Grow and Deliver High-Quality, Person-Centered Care Through Accountable Care Organizations," CMS Newsroom, January 26, 2022, available at https:/Avww.cms.gov/newsroom/press-releases/ medicare-shared-savings-program-continues-grow-and-deliver-high-quality-person-centered-care-through. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -29- [FN6] . Press release, "Ahead of SURS Program Expiration, Bennet, Cassidy, Welch, Burgess Introduce Legislation to Extend Technical Support Program for Clinicians in Small Practices," Michael Bennet, February 2, 2022, available at https:/Avww.bennet.senate.gov/ public/index.cfm/2022/2/ahead-of-surs-program-expiration-bennet-cassidy-welch-burgess-introduce-legislation-to-extend-technical- support-program-for-clinicians-in-small-practices. [FN7] . Press release, "Despite Push to Reward Physicians for Quality and Value, Most Health Systems Base Pay on Volume," RAND, January 28, 2022, available at https:/Avww.rand.org/news/press/2022/01/28.html. [FN8] . Press release, "Hundreds of Healthcare Organizations Rally in Support of Direct Contracting," NAACOS, February 14, 2022, available at https:/Avww.naacos.com/press-release--hundreds-of-healthcare-organizations-rally-in-support-of-direct-contracting. [FN9] . Press release, "CMS Redesigns Accountable Care Organization Model to Provide Better Care for People with Traditional Medicare," CMS Newsroom, February 24, 2022, available at https:/Awww.cms.gov/newsroom/press-releases/cms-redesigns-accountable-care- organization-model-provide-better-care-people-traditional-medicare. [FN10] . Press release, "NAACOS Launches ACO REACH Coalition Work Will Help the Provider Community Understand and Prepare for New Innovation Center Model," NAACOS National Association of ACOs, March 1, 2022, available at https://www.naacos.com/press- release--naacos-launches-aco-reach-coalition. [FN11] . Fact sheet, "Accountable Care Organization (ACO) Realizing Equity, Access, and Community Health (REACH) Model," CMS Newsroom, February 24, 2022, available at https://(www.cms.gov/newsroom/fact-sheets/accountable-care-organization-aco-realizing- equity-access-and-community-health-reach-model. [FN12] . Press release, "NAACOS Celebrates 10th Anniversary of Largest ACO Model," NAACOS, March 31, 2022, available at https:// www.naacos.com/press-release--naacos-celebrates-1 Oth-anniversary-of-largest-aco-model. [FN13] . Frieden, Joyce, "HHS Secretary Expresses Interest in Medicare Fee Schedule Reform," MedPage Today, March 17, 2022, available at https:/Avww.medpagetoday.com/publichealthpolicy/medicare/97730. [FN14] . Press release, "AMA asks Congress to fix Medicare Physician Payment System," AMA, March 15, 2022, available at https:/Awww.ama- assn.org/press-center/press-releases/ama-asks-congress-fix-medicare-physician-payment-system. [FN15] . Hancock, Peter, "Illinois lawmakers OK bill to drive $700M into Medicaid-funded nursing homes to boost care," Capito! News Illinois, April 9, 2022, available at https://Awww.sj-r.com/story/news/state/2022/04/08/illinois-bill-would-drive-700-million-nursing-homes- advances/9510576002/. [FN16] . Press release, "Governor Hochul Announces Historic $20 Billion Multi-Year Healthcare Investment in FY 2023 Budget," Governor Kathy Hochul, April 9, 2022, available at https://Awww.governor.ny.gov/news/governor-hochul-announces-historic-20-billion-multi-year- healthcare-investment-fy-2023-budget. [FN17] . Press release, "Public Health Infrastructure Needs $36.7 Billion Investment Over Next 10 Years, HIMSS Report Finds," PressReleasePoint, May 3, 2022, available at https:/Awww.pressreleasepoint.com/public-health-infrastructure-needs-367-billion- investment-over-next-10-years-himss-report-finds. [FN18] THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -23- . Kennedy, Chris, "Transforming the way we pay for and deliver primary care!," Chris Kennedy for State Representative, April 27, 2022, available at https:/Avwww.kennedy4co.com/2022/04/27/transforming-the-way-we-pay-for-and-deliver-primary-careR-/. [FN19] . Donlan, Andrew, "Home Health Providers Believe Value-Based Contracts Will Represent Over Half of Business Soon," Home Health Care News, May 19, 2022, available at https://nomehealthcarenews.com/2022/05/home-health-providers-believe-value-based- contracts-will-represent-over-half-of-business-soon/. [FN20] . Bailey, Victoria, "Efficient Data Sharing Needed for Value-Based Care Transition," RevCycle Intelligence, May 17, 2022, available at https://revcycleintelligence.com/features/efficient-data-sharing-needed-for-value-based-care-transition. [FN21] . Press release, "ASTRO letter to CMS outlines pathways to achieve value-based payment for radiation oncology," Newswire, June 2, 2022, available at https://www.newswise.com/articles/new-astro-letter-to-cms-outlines-pathways-to-achieve-value-based-payment-for- radiation-oncology. [FN22] . Muoio, Dave, "CareMax pays up for Steward Health Care System's 171,000 Medicare value-based care patients," Fierce Healthcare, June 1, 2022, available at https:/Avww.fiercehealthcare.com/payers/caremax-pays-steward-health-care-systems-1 7 1000-medicare- value-based-care-patients. [FN23] . Fact sheet, "Enhancing Oncology Model," CMS Newsroom, June 27, 2022, available at https:/Awww.cms.gov/newsroom/fact-sheets/ enhancing-oncology-model. [FN24] . Press release, "CMS Proposes Physician Payment Rule to Expand Access to High-Quality Care," CMS Newsroom, July 7, 2022, available at https:/Avww.cms.gov/newsroom/press-releases/cms-proposes-physician-payment-rule-expand-access-high-quality-care. [FN25] . Press release, "Many Significant ACO Changes Included in Proposed Medicare Rule," NAACOS, July 7, 2022, available at https:// www.naacos.com/press-release--many-significant-aco-changes-included-in-proposed-medicare-rule. [FN26] . Stulick, Amy, "CMS Makes Significant Updates to ACOs But Still Leaves Nursing Homes Largely Out of Conversation," Skilled Nursing News, July 20, 2022, available at https://skillednursingnews.com/2022/07/cms-makes-significant-updates-to-acos-but-still-leaves- nursing-homes-largely-out-of-conversation/. [FN27] . Wagner, Aaron, "Evaluating a new model for funding rural healthcare in Pennsylvania," Penn State, July 21, 2022, available at https:// www.psu.edu/news/health-and-human-development/story/evaluating-new-model-funding-rural-healthcare-pennsylvania/. [FN28] . Press release, "CMS Encourages States to Use Medicaid Payments to Nursing Homes to Drive Better Health Outcomes for Residents, Improve Staffing," CMS Newsroom August 22, 2022, available at https:/Awww.cms.gov/newsroom/press-releases/cms- encourages-states-use-medicaid-payments-nursing-homes-drive-better-health-outcomes-residents. [FN29] . Navathe, MD, Amol S., and Joshua M. Liao, MD, MSc, "Aligning Value-Based Payments With Health Equity A Framework for Reforming Payment Reforms," JAMA Network, August 15, 2022, available at https://jamanetwork.com/journals/ jama/fullarticle/2795498. [FN30] . Press release, "More than 800 ACOs and Other Provider Organizations Ask Congress to Save Value-Based Payment Incentives," NAACOS, September 2022, available at https:/Awww.naacos.com/press-release--more-than-800- acos-and-other-provider-organizations-ask-congress-to-save-value-based-payment-incentives. THOMSON REUTERS © 2023 Thomson Reuters. No claim to original U.S. Government Works. -24- [FN31] . Press release, "Medicare Shared Savings Program Saves Medicare More Than $1.6 Billion in 2021 and Continues to Deliver High- quality Care," CMS Newsroom, August 30, 2022, available at https://www.cms.gov/newsroom/press-releases/medicare-shared-savings- program-saves-medicare-more-16-billion-2021 -and-continues-deliver-high. [FN32] . Press release, "Blue Shield launches new "episode of care" payment model," California Medical Association, October 3, 2022, available at https:/Awww.cmadocs.org/newsroom/news/view/Articleld/49895/Blue-Shield-launches-new-episode-of-care-payment-model. [FN33] . Lin, Sunny C., PhD, MS, Karen E. Joynt Maddox, MD MPH, Andrew M. Ryan PhD, et al, "Exit Rates of Accountable Care Organizations That Serve High Proportions of Beneficiaries of Racial and Ethnic Minority Groups," Jama Health Forum, September 20, 2022, available at https://jamanetwork.com/journals/jama-health-forum/fullarticle/2796897. [FN34] . Press release, "NAACOS Task Force Recommends Path Toward Digital Quality Measurement," NAACOS, October 14, 2022, available at https://www.naacos.com/press-release--naacos-task-force-recommends-path-toward-digital-quality-measurement. [FN35] . 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