Banner Health Considers Pioneer ACO Contract

Arizona may be the home of the first pioneer ACO, if the state’s Banner Health accepts a contract presented by CMS this week. The largest health system in the state, Banner has a lot to gain from the early adopter ‘pioneer’ program.

In a statement describing massive funding cuts, Banner CEO Peter Fine explained the thought behind the move to ACO.

The traditional model of fee-for-service is gradually giving way to a collaborative model in which reimbursement is shared by hospitals, physicians and other providers based on the health management of defined populations…Doubtless, there will be those who will decry ACOs as a by-product of health-care reform and therefore unworthy of consideration. However, ACOs and similar collaborative models are moving forward whether health-care reform is implemented or not.

For Banner, the only point of concern was timing. “The issue before us now is that of timing. How fast can we bring new models of collaboration into existence?” Fine asked in his statement. As it turns out, it’s a question that many people are asking.

In a white paper available from the Robert Wood Johnson Foundation, authors Berenson RA and Burton RA explain that “…so far, the reception to CMS’ final regulations has been positive, but how many organizations will actually apply to CMS to be ACOs is another question.” The paper attempted to explain CMS’s motives for the ACO Pioneer program, and to establish a prediction on the widespread success of the program. FierceHealthcare summarizes:

How many and how fast will ACOs spread? CMS estimates 50 to 270 ACOs will sign up to participate, generating a net savings of $940 million during the first four years through Shared Savings, according to a recent report by the Urban Institute and the Robert Wood Johnson Foundation…

…According to the report, it's unclear if the Shared Savings Program and the earlier Pioneer ACO model are intended to test the ACO concept for large-scale implementation, to see whether it generates sustainable governmental savings, or to move as many providers as possible to ACOs to curb Medicare spending.

A few years will probably pass before we can come to any definitive conclusions on the program, but the Banner exercise at least demonstrates how much is at stake.

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.

Final Rule Addresses ACO Criticism

At their first announcement, the Centers for Medicare and Medicaid Services’ rules for ACOs caused an uproar. Accountable Care Organizations will reward medical providers that meet certain quality of care requirements, but health professionals found the rules to be needlessly complicated, hard to follow, and unrealistic. CMS responded quickly, committing to rework and improve the rule set.

On October 20^th, the proposed changes, collectively called the final rule, released to public acclaim. CMS Administrator Dr. Donald Berwick told Kaiser Health News, “We have been able to fine tune and improve the rules for a range of stakeholders, providers and patients.” Across the board, health industry officials are praising CMS for the new rule changes, and it seems that these requirements will finally move toward improving the country’s health care.

FierceHealthCare.com put together a table outlining the changes CMS made. We have an excerpt below, or you can view the full table here.

Topic	Proposed rule	Final rule
Transition to risk in Track 1	ACOs offer two tracks. Track 1 would entail two years of one-sided shared savings; then participants would have to transition in third year to a performance-based risk, two-sided model of savings and losses.	ACOs still offer two tracks. Track 1 now removes two-sided risk.
Prospective vs. retrospective	Retrospective assignment based on primary care service use, with prospective identification of benchmark population	Preliminary prospective-assignment with beneficiaries identified quarterly, with final reconciliation after each performance year
Quality measures	65 measures in 5 domains	33 measures in 4 domains
Shared savings	One-sided risk model: Sharing begins at savings of 2 percent Two-sided risk model: Sharing on first dollar	Share on first dollar for all ACOs in both models once min. savings rate is achieved

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.

Medicare Annual Open Enrollment Begins Early

This year, CMS has announced an early launch for Open Enrollment, which will begin October 15^th, instead of the usual date of November 15^th. The enrollment will end on December 7^th. CMS made this change under hopes that it would improve the enrollment process for Medicare beneficiaries, according to the official press release.

This gives people with Medicare a full seven weeks to compare and make decisions, and ensures that they will have essential plan materials and membership cards in hand on January 1, 2012 when new coverage starts.

In the press release, CMS also made efforts to stress the importance of investigating and exploring plan options.

There'll be a wide range of health and drug plan options available across the country, including Original Medicare. Most people with Medicare can choose a "Part D" plan to help them pay for prescription drugs. And people who have chosen to enroll in a "Part C" Medicare Advantage plan for their basic health care services have the option of staying in that plan, choosing a different plan, or going back to the Original Medicare program. Plans can change from year to year, so these are important choices that should be made with care.

As usual, the organization is making a big push to promote information sources such as 1-800-MEDICARE and http://www.medicare.gov. We saw many efforts being made around this time last year to promote those educational channels, and it is certainly good to see them remaining a large part of CMS’s enrollment initiative.

 

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.

Health Reform……One Year Later

Health Reform, now commonly known as the Affordable Care Act, is one year old this month. About a year ago, I wrote a blog post discussing my initial thoughts on the legislation from an unbiased perspective, and while there were many disagreements and differing opinions when it was passed (and since), the one thing everyone agreed on was that the law was going to continue to change as it was implemented.

Almost immediately its constitutionality became suspect, with 26 states appealing the law. A Virginia judge ruled the individual mandate is unconstitutional, and a Florida judge has ruled the entire legislation is unconstitutional. As a result, many of the 26 states are refusing to implement health reform in its current form. Despite this opposition, the Federal administration continues to hold its position that health reform will result in a large cost savings in Medicare that would be lost if provider reimbursement reform were sacrificed. The Federal administration has also appealed the Florida judge’s ruling, and this case is expected to reach the U.S. Supreme Court.

In addition to the argument over the constitutionality, two of the largest challenges posed are the feasibility of certain types of plans operating under the new guidelines and the Individual Mandate clause. By way of compromise, the administration has approved two types of waivers. One waiver exempts certain plans, including Mini-Med plans (plans that offer limited or reduced set of benefits at a low cost) from the 80% Medical Loss Ratio mandate portion of the law. This is important, as one of Merrill’s largest healthcare clients is a Mini-Med plan. The second waiver type allows states to “opt out” of the Individual Mandate if they can prove their state-run alternative meets or exceeds expectations as outlined in the law. Again, this is important, as another one of Merrill's large healthcare clients operates in the individual market.

As we continue to move through the implementation of health reform, we must be knowledgeable and agile, understanding our health plan partners’ day-to-day challenges in adjusting and adapting to frequent and ongoing alterations to the law. The more we understand the changing climate of healthcare, the better positioned we will be to strengthen our partner relationships and manage internal change to accommodate market conditions.

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.

Health Reform Legislation Threatens Mini-Med Plans

If there has been one clear victim of the new health plan regulations, Mini-Med Plans are it. Last year when the new MLR percentages became reality, hundreds of Mini-Meds began seeking alternative measures to survive. HHS has provided a solution for 1,040 such plans. Out of all the Mini-Med Plans that applied, 94% have been granted a waiver, allowing the plans to be considered exempt from the new law. The exemption lasts only for one year, but is renewable until the full weight of the reform falls in 2014.

The waivers are required because the Mini-Med Plans, which provide care for over 2.6 million people, do not meet the minimum annual dollar limit on essential benefits as outlined in the reform legislation. This limit starts at $750,000 in 2011, increasing to $2 million in 2013. By 2014, the law states that there is to be no annual limit on essential benefits.

Mini-Med Plans cater to low-income or part-time workers, who often do not qualify for more expensive plans. Unless the reform legislation is re-written to account for these smaller providers, 2014 will see the end of Mini-Meds, and those employees will be forcefully folded into the government-created health exchange planned for 2014.

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.

Clarity of Health Reform

The debate rages on regarding health reform and the focus has now shifted to the constitutionality of the legislation. A Virginia judge ruled the individual mandate was unconstitutional and a Florida judge ruled the entire legislation was unconstitutional. This has sparked the 26 states included in the fight against the health reform legislation to withhold from implementing the act. 

Such states as Alaska have openly commented they will not enact the legislation but begin developing their own plans for health reform within their state. Gov. Sean Parnell said the state would pursue lawful, market-based solutions of its own. That includes planning for a health insurance exchange, meant to offer a choice of health plans.

This action compelled the White House to quickly respond stating while the Virginia and Florida judge have sited unconstitutionality of the law the law must not be upheld and implementation must continue. 

The main theme cited was the cost savings associated with the Medicare payment reform on 100 million Medicare claims that are processed each month. As the constitutionality of health reform continues to be at the forefront it appears only a ruling by the Supreme Court can conclude the acts fate.

For more information, read the Associated Press article on the topic here and to learn more via webinar, click here.

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Pam Argeris is a thought leader in the Healthcare Industry and possesses extensive, hands-on experience with CMS compliance, and multiple regulatory bodies such as NCQA, JACHO, and DOI. In her role at Merrill Corp., Pam focuses on developing solutions for compliance and quality assurance, delivered in a cost effective manner to improve beneficiary and prospect communications. You can contact Pam at Pamela.Argeris@merrillcorp.com.