In 2015, two-thirds of Medicare beneficiaries had two or more chronic illnesses and together accounted for 93% of total program spending. Small wonder, then, that healthcare systems are re-engineering how they care for older, chronically ill patients as Medicare shifts greater risk for cost and outcomes from payer to provider.
There’s some welcome news on this front from Capitol Hill. Multispecialty medical groups and health systems operating accountable care organizations or participating in Medicare Advantage plans will find some new tools for managing this patient population if they look closely at the provisions of the Bipartisan Budget Act of 2018. This is because the new budget law included the Creating High-Quality Results and Outcomes Necessary to Improve Chronic (CHRONIC) Care Act of 2017. The American Medical Group Association and its members support the provisions in the legislation.
Here are five things healthcare executives need to know about the new law:
1. It gives all Medicare Shared Savings Program ACOs the option to have beneficiaries assigned prospectively (at the beginning of a performance year) rather than retrospectively.
The goal is to provide these ACOs the ability to better manage their patient population, coordinate care, and provide flexibility to target needed services to individuals living with chronic conditions.
Why this is important: ACOs need to risk-stratify their population and provide intensive services to the highest risk patients (i.e., care management, more frequent outpatient visits). They need to close gaps in care, particularly for patients who have not had a recent office visit.
Under the current retrospective methodology of attribution, ACOs are given a quarterly list of patients that may be attributed to them―but they don’t find out until the end of the year who on that preliminary list is actually going to be included. It is estimated that from quarter to quarter, 20% to 30% of the patients on that list change. Imagine being in a class and being told on Monday that you have a test on Friday that includes algebra, geometry and trigonometry. However, when the test is given on Friday, the teacher tells you that they removed algebra and added calculus. You would not and could not be prepared!
Prospective attribution ensures that ACOs can focus their attention and resources on the correct population for the entire year, thus increasing their likelihood for success and the likelihood of better quality and utilization outcomes for their patients.
2. It establishes the beneficiary incentive program to allow ACOs taking downside risk to use their own funds to help assigned patients afford important primary care services needed to manage their chronic conditions.
Why this is important: Allowing ACOs to offer their patients incentives to receive their primary care (indeed, all care) within their four walls is a clear win for Medicare beneficiaries. Patients in ACOs receive coordinated, evidence-based care, all backed by teams of providers, including nurses, therapists and of course physicians. There’s no problem with duplicative procedures, test results aren’t lost in the mail, and there’s no confusing referrals to specialists all over town. For patients with chronic conditions, coordinated care is simply the best way to be treated. Moreover, models of care like ACOs that encourage patients to visit regularly with their primary care physician typically have lower overall healthcare costs due to fewer emergency room visits and hospital admissions because the relationship allows the identification of early symptoms or disease states.
Patients are also more likely to call their PCP when they have a problem rather than run to the ER. However, encouraging routine visits for preventive services or checkups is often a hard sell. Patients usually feel well and they often have to pay something out-of-pocket for that visit. This means that patients will frequently ignore minor symptoms or routine checkups and wait until their symptoms or diseases have advanced to a point where they must seek care. This often results in more costly care and a more expensive site of service (i.e., ER, hospital).
A financial incentive—such as waiving copays—for patients to make these visits would not only offset the cost but perhaps also lead them to make time to visit their PCP even when they are “feeling fine and don’t need a doctor.”
3. It gives some ACOs more flexibility to provide telehealth services.
Why this is important: Expanding telehealth allows providers to stay connected with patients who have difficulty getting out of their residence and coming to the office for a preventive visit or routine checkup that could help to prevent an ER visit or hospitalization, not to mention the 911 call for an ambulance. Consider patients with a history of stroke, stage IV chronic heart failure, or neurologic issues that make it difficult to travel. These patients often are not by definition “homebound,” but the effort it takes to come to the office is enough to prevent them from doing so.
4. It allows MA plans to expand telehealth benefits. Specifically, it would allow MA plans to offer telehealth as a regular benefit rather than as a supplemental benefit.
Why this is important: It would encourage greater adoption of telehealth in MA plans, with the same advantages as in the example above.
5. It expands supplemental benefits for MA plans so they can offer a wider array of benefits that may be non-health-related but will help better address the underlying causes of chronic illness.
Why this is important: MA plans must cover the same services as Medicare, and most MA plans offer extra benefits. The new law would expand the ability of MA plans to offer supplemental benefits targeted at chronically ill enrollees, which could include counseling, fitness benefits, remote access technologies, and disease management.
Reimbursement solely for episodic care is analogous to playing defense as patients present, and physicians treat, mostly when there is an ailment. Supplemental benefits, not necessarily linked to episodic care, is one way the healthcare system can play offense.
Chet Speed is the vice president of public policy, AMGA, a trade association dedicated to transforming healthcare.