82_FR_181
82 FR 180 - Medicare Program; Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model (CJR)
82 FR 180 - Medicare Program; Advancing Care Coordination Through Episode Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model (CJR)
DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services
Federal Register Volume 82, Issue 1 (January 3, 2017)
Page Range
180-651
FR Document
2016-30746
This final rule implements three new Medicare Parts A and B episode payment models, a Cardiac Rehabilitation (CR) Incentive Payment model and modifications to the existing Comprehensive Care for Joint Replacement model under section 1115A of the Social Security Act. Acute care hospitals in certain selected geographic areas will participate in retrospective episode payment models targeting care for Medicare fee- for-service beneficiaries receiving services during acute myocardial infarction, coronary artery bypass graft, and surgical hip/femur fracture treatment episodes. All related care within 90 days of hospital discharge will be included in the episode of care. We believe these models will further our goals of improving the efficiency and quality of care for Medicare beneficiaries receiving care for these common clinical conditions and procedures.
Federal Register, Volume 82 Issue 1 (Tuesday, January 3, 2017)
[Federal Register Volume 82, Number 1 (Tuesday, January 3, 2017)]
[Rules and Regulations]
[Pages 180-651]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-30746]
[[Page 179]]
Vol. 82
Tuesday,
No. 1
January 3, 2017
Part II
Book 2 of 2 Books
Pages 179-710
Department of Health and Human Services
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Centers for Medicare & Medicaid Services
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42 CFR Parts 510 and 512
Medicare Program; Advancing Care Coordination Through Episode Payment
Models (EPMs); Cardiac Rehabilitation Incentive Payment Model; and
Changes to the Comprehensive Care for Joint Replacement Model (CJR);
Final Rule
Federal Register / Vol. 82 , No. 1 / Tuesday, January 3, 2017 / Rules
and Regulations
[[Page 180]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Parts 510 and 512
[CMS-5519-F]
RIN 0938-AS90
Medicare Program; Advancing Care Coordination Through Episode
Payment Models (EPMs); Cardiac Rehabilitation Incentive Payment Model;
and Changes to the Comprehensive Care for Joint Replacement Model (CJR)
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Final rule.
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SUMMARY: This final rule implements three new Medicare Parts A and B
episode payment models, a Cardiac Rehabilitation (CR) Incentive Payment
model and modifications to the existing Comprehensive Care for Joint
Replacement model under section 1115A of the Social Security Act. Acute
care hospitals in certain selected geographic areas will participate in
retrospective episode payment models targeting care for Medicare fee-
for-service beneficiaries receiving services during acute myocardial
infarction, coronary artery bypass graft, and surgical hip/femur
fracture treatment episodes. All related care within 90 days of
hospital discharge will be included in the episode of care. We believe
these models will further our goals of improving the efficiency and
quality of care for Medicare beneficiaries receiving care for these
common clinical conditions and procedures.
DATES: Effective dates: This rule is effective February 18, 2017,
except for the following amendatory instructions: number 3 amending 42
CFR 510.2; number 4 adding 42 CFR 510.110; number 6 amending 42 CFR
510.120; number 14 amending 42 CFR 510.405; number 15 42 CFR 510.410;
number 16 revising 42 CFR 510.500; number 17 revising 42 CFR 510.505;
number 18 adding 42 CFR 510.506; and number 19 amending 42 CFR 510.515,
which are effective July 1, 2017.
Applicability date: The regulations at 42 CFR part 512 are
applicable July 1, 2017.
FOR FURTHER INFORMATION CONTACT: For questions related to the EPMs:
[email protected].
For questions related to the CJR model: [email protected].
SUPPLEMENTARY INFORMATION:
Electronic Access
This Federal Register document is also available from the Federal
Register online database through Federal Digital System (FDsys), a
service of the U.S. Government Printing Office. This database can be
accessed via the internet at http://www.thefederalregister.org/fdsys/.
Alphabetical List of Acronyms
Because of the many terms to which we refer by acronym,
abbreviation, or short form in this final rule, we are listing the
acronyms, abbreviations and short forms used and their corresponding
terms in alphabetical order.
ACE Acute-care episode
ACO Accountable Care Organization
ALOS Average length of stay
AMA American Medical Association
AMI Acute Myocardial Infarction
APM Alternative Payment Model
APRN Advanced Practice Registered Nurse
ASC QRP Ambulatory Surgical Center Quality Reporting Program
ASC Ambulatory Surgical Center
ASPE Assistant Secretary for Planning and Evaluation
BAA Business Associate Agreement
BPCI Bundled Payments for Care Improvement
CABG Coronary Artery Bypass Graft
CAD Coronary artery disease
CAH Critical access hospital
CBSA Core-Based Statistical Area
CC Complication or comorbidity
CCDA Consolidated clinical document architecture
CCDE Core clinical data elements
CCN CMS Certification Number
CEC Comprehensive ESRD Care Initiative
CEHRT Certified Electronic Health Record Technology
CEP Clinical Episode Payment
CFR Code of Federal Regulations
CHIP Children's Health Insurance Program
CJR Comprehensive Care for Joint Replacement
CMHC Community Mental Health Center
CMI Case Mix Index
CMP Civil monetary penalty
CQMC Core Quality Measure Collaborative
CMS Centers for Medicare & Medicaid Services
CoP Condition of Participation
CORF Comprehensive Outpatient Rehabilitation Facility
CPC Comprehensive Primary Care Initiative
CPT Current Procedural Terminology
CR Cardiac rehabilitation
CRNA Certified Registered Nurse Anesthetists
CSA Combined Statistical Area
CVICU Cardiovascular intensive care units
CY Calendar year
DES Drug-eluting stents
DME Durable medical equipment
DMEPOS Durable medical equipment, prosthetics, orthotics, and
supplies
DR Downside Risk
DSH Disproportionate Share Hospital
DUA Data Use Agreement
ED Emergency Department
ECMO Extracorporeal membrane circulation
ECQM Electronic Clinical Quality Measures
EFT Electronic funds transfer
EGM Episode Grouper for Medicare
EHR Electronic health record
E/M Evaluation and management
EPM Episode payment model
ESCO ESRD Seamless Care Organization
ESRD End-Stage Renal Disease
FFS Fee-for-service
FFR Fractional Flow Reserve
GAAP Generally-Accepted Accounting Principles
GEM General Equivalence Mapping
GPCI Geographic Practice Cost Index
HAC Hospital-Acquired Condition
HACRP Hospital-Acquired Condition Reduction Program
HCAHPS Hospital Consumer Assessment of Healthcare Providers and
Systems
HCC Hierarchical Condition Category
HCPCS Healthcare Common Procedure Coding System
HHA Home health agency
HHPPS Home Health Prospective Payment System
HHRG Home Health Resource Group
HHS U.S. Department of Health and Human Services
HH QRP Home Health Quality Reporting Program
HICN Health Insurance Claim Number
HIPAA Health Insurance Portability and Accountability Act
HIQR Hospital Inpatient Quality Reporting
HIV Human Immunodeficiency Virus
Health IT Health Information Technology
HLM Hierarchical Logistic Regression model
HLMR HCAHPS Linear Mean Roll Up
HOOS Hip Dysfunction and Osteoarthritis Outcome Score
HOPD Hospital outpatient department
HRRP Hospital Readmissions Reductions Program
HRR Hospital Referral Region
HVBP Hospital Value-Based Purchasing Program
ICD-9-CM International Classification of Diseases, 9th Revision,
Clinical Modification
ICHOM International Consortium for Health Outcomes Measurement
IRFQR Inpatient Rehabilitation Facilities Quality Reporting
ICD Implantable Cardioverter Defibrillator
ICD-10-CM International Classification of Diseases, 10th Revision,
Clinical Modification
ICR Intensive Cardiac Rehabilitation
I-I Inpatient to inpatient transfer
IME Indirect medical education
IP Inpatient
IPF Inpatient psychiatric facility
IPF QRP Inpatient Psychiatric Facility Quality Reporting Program
IPPS Inpatient Prospective Payment System
IRF Inpatient rehabilitation facility
IRF QRP Inpatient Rehabilitation Facility Quality Reporting Program
IVR Active Interactive Voice Recognition
KOOS Knee Injury and Osteoarthritis Outcome Score
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LAN Healthcare Payment Learning and Action Network
LBBB Left bundled branch block
LEJR Lower-extremity joint replacement
LEP limited English proficiency
LIP Low-income percentage
LOS Length-of-stay
LTCH QRP Long-Term Care Hospital Quality Reporting Program
LTCH Long-term care hospital
LUPA Low-utilization payment adjustment
MA Medicare Advantage
MAC Medicare Administrative Contractor
MACRA Medicare Access and CHIP Reauthorization Act of 2015
MAP Measure Application Partnership
MAPCP Multi-Payer Advanced Primary Care Practice
MAT Measure Authoring Tool
MCC Major complications or comorbidities
MCCM Medicare Care Choices Model
MDC Major diagnostic category
MDH Medicare-Dependent Hospital
MDM Master Database Management
MedPAC Medicare Payment Advisory Commission
MIPS Merit-based Incentive Payment System
MP Malpractice
MSA Metropolitan Statistical Area
MS-DRG Medical Severity Diagnosis-Related Group
MSPB Medicare Spending Per Beneficiary
NHDS National Hospital Discharge Survey
NCDR National Cardiovascular Data Registry
NDR No Downside Risk
NPI National Provider Identifier
NPPGP Non-Physician Practitioner Group Practice
NPRA Net Payment Reconciliation Amount
NQF National Quality Forum
NSTEMI Non ST-elevation myocardial infarction
OCM Oncology Care Model
OIG Department of Health and Human Services' Office of the Inspector
General
O-I Outpatient-to-inpatient transfer
OPPS Outpatient Prospective Payment System
OPT Outpatient Physical Therapist
OQR Outpatient Quality Reporting
PACE Program of All-Inclusive Care for the Elderly
PBPM Per-beneficiary per-month
PCI Percutaneous Coronary Intervention
PCMH Primary Care Medical Homes
PE Practice Expense
PEP Partial Episode Payment
PFS Physician Fee Schedule
PGP Physician group practice
PHA Partial hip arthroplasty
PQRS Physician Quality Reporting System
PPS Prospective Payment System
PRO Patient-Reported Outcome
PROMIS Patient-Reported Outcomes Measurement Information Systems
PROM Patient-Reported Outcome Performance Measure
PTAC Focused Payment Model Technical Advisory Committee
PTCA Percutaneous transluminal coronary angioplasty
PY Performance year
QCDR Qualified clinical data registries
QE Qualified Entity
QIO Quality Improvement Organization
QP Qualifying APM Participant
QPP Quality Payment Program
QRDA Quality Reporting Document Architecture
QRUR Quality and Resource Use Reports
RAC Recovery Audit Contractor
RRC Rural Referral Center
RSCR Risk-Standardized Complication Rate
RSRR Risk-Standardized Readmission Rate
RSMR Risk-Standardized Mortality Rate
RVU Relative Value Unit
SCH Sole Community Hospital
SDS Socio-demographic Status
SFT Secure File Transfer
SHFFT Surgical hip/femur fracture treatment
SHIP State Health Insurance Assistance Programs
SILS2 Single Item Health Literacy Screening
SLA Service level agreement
SNF Skilled nursing facility
SNF-QRP QRP Skilled Nursing Facility Quality Reporting Program
SSDMF Social Security Death Master file
STEMI ST-elevation myocardial infarction
STS Society of Thoracic Surgeons
ST-T ST-segment-T wave
TEP Technical Expert Panel
TGP Therapy Group Practice
THA Total hip arthroplasty
TIN Taxpayer identification number
TJA Total joint arthroplasty
TKA Total knee arthroplasty
TP Target price
UHDDS Uniform Hospital Discharge Data Set
VAD Ventricular Assist Device
VBP Value Based Purchasing
VR-12 Veterans Rand 12 Item Health Survey
Table of Contents
I. Executive Summary
A. Purpose
B. Summary of the Major Provisions
1. Model Overview--EPM Episodes of Care
2. Model Scope
3. Payment
4. Similar, Previous, and Concurrent Models
5. Overlap With Ongoing CMS Efforts
6. Quality Measures and Reporting Requirements
7. Beneficiary Protections
8. Financial Arrangements
9. Data Sharing
10. Program Waivers
C. Summary of Economic Effects
II. Background
III. Episode Payment Models
A. Selection of Episodes, Advanced Alternative Payment Model
Considerations, and Future Directions
1. Selection of Episodes for Episode Payment Models in This
Rulemaking
a. Overview
b. SHFFT Model
c. AMI and CABG Models
2. Advanced Alternative Payment Model Considerations
a. Overview for the EPMs
b. EPM Participant Tracks
c. Clinician Financial Arrangements Lists Under the EPMs
d. Documentation Requirements
3. Future Directions for Episode Payment Models
a. Refinements to the BPCI Initiative Models
b. Potential Future Condition-Specific Episode Payment Models
c. Potential Future Event-Based Episode Payment Models for
Procedures and Medical Conditions
d. Health Information Technology Readiness for Potential Future
Episode Payment Models
B. Definition of the Episode Initiator and Selected Geographic
Areas
1. Background
2. Definition of Episode Initiator
3. Financial Responsibility for Episode of Care
4. Geographic Unit of Selection and Exclusion of Selected
Hospitals
5. Overview and Options for Geographic Area Selection for AMI
and CABG Episodes
a. Exclusion of Certain MSAs
b. Selection Approach
(1) Factors Considered but Not Used
(2) Sample Size Calculations and the Number of Selected MSAs
(3) Method of Selecting MSAs
C. Episode Definition for EPMs
1. Background
2. Overview of Three New Episode Payment Models
3. Clinical Dimensions of AMI, CABG, and SHFFT Model Episodes
a. Definition of the Clinical Conditions Included in AMI, CABG,
and SHFFT Model Episodes
(1) AMI (Medical Management and PCI) Model
(2) CABG Model
(3) SHFFT (Excludes Lower Extremity Joint Replacement) Model
b. Definition of the Related Services Included in EPM Episodes
4. EPM Episodes
a. Beneficiary Care Inclusion Criteria and Beginning of EPM
Episodes
(1) General Beneficiary Care Inclusion Criteria
(2) Beginning AMI Episodes
(3) Beginning CABG Episodes
(4) Beginning SHFFT Episodes
(5) Special Policies for Hospital Transfers of Beneficiaries
With AMI
b. Middle of EPM Episodes
c. End of EPM Episodes
(1) AMI and CABG Models
(2) SHFFT Model
D. Methodology for Setting EPM Episode Prices and Paying EPM
Participants in the AMI, CABG, and SHFFT Models
1. Background
a. Overview
b. Key Terms for EPM Episode Pricing and Payment
2. Performance Years, Retrospective Episode Payments, and Two-
Sided Risk EPMs
a. Performance Period
b. Retrospective Payment Methodology
c. Two-Sided Risk EPMs
3. Adjustments to Actual EPM Episode Payments and to Historical
Episode Payments Used To Set Episode Prices
[[Page 182]]
a. Overview
b. Special Payment Provisions
c. Services That Straddle Episodes
d. High-Payment EPM Episodes
e. Treatment of Reconciliation Payments and Medicare Repayments
When Calculating Historical EPM-Episode Payments To Update EPM-
Episode Benchmark and Quality-Adjusted Target Prices
4. EPM-Episode Price-Setting Methodologies
a. Overview
(1) AMI Model DRGs
(2) CABG Model DRGs
(3) SHFFT Model DRGs
b. EPM-Episode Benchmark and Quality-Adjusted Target Price
Features
(1) Risk-Stratifying EPM-Episode Benchmark Prices Based on MS-
DRG and Diagnosis
(2) Adjustments To Account for EPM-Episode Price Variation
(a) Adjustments for Certain AMI Model Episodes With Chained
Anchor Hospitalizations
(b) Adjustments for CABG Model Episodes
(c) Adjustments for Certain AMI Model Episodes With CABG
Readmissions
(d) Potential Future Approaches To Setting Target Prices for AMI
and Hip Fracture Episodes
(e) Summary of Pricing Methodologies for AMI, CABG, and SHFFT
Model Episode Scenarios
(3) 3 Years of Historical Data
(4) Trending Historical Data to the Most Recent Year
(5) Update Historical EPM-Episode Payments for Ongoing Payment
System Updates
(6) Blend Hospital-Specific and Regional Historical Data
(7) Define Regions as U.S. Census Divisions
(8) Normalize for Provider-Specific Wage Adjustment Variations
(9) Combining Episodes To Set Stable Benchmark and Quality-
Adjusted Target Prices
(10) Effective Discount Factor
c. Approach To Combine Pricing Features for all SHFFT Model
Episodes and AMI Model Episodes Without CABG Readmissions
d. Approach To Combine Pricing Features for CABG Model Episodes
(1) Anchor Hospitalization Portion of CABG Model Episodes
(2) Approach To Combine Pricing Features for Post-Anchor
Hospitalization Portion of CABG Model Episodes
(3) Combine CABG Anchor Hospitalization Benchmark Price and CABG
Post-Anchor Hospitalization Benchmark Price
e. Approach To Combine Pricing Features for AMI Model Episodes
With CABG Readmissions
5. Process for Reconciliation
a. Net Payment Reconciliation Amount (NPRA)
b. Payment Reconciliation
c. Reconciliation Report
6. Adjustments for Overlaps With Other Innovation Center Models
and CMS Programs
a. Overview
b. Provider Overlap
(1) BPCI Participant Hospitals in Geographic Areas Selected for
EPMs
(2) BPCI Physician Group Practice (PGP) Episode Initiators in
Hospitals Participating in EPMs
c. Beneficiary Overlap
(1) Beneficiary Overlap With BPCI
(2) Beneficiary Overlap With the CJR Model and Other EPMs
(3) Beneficiary Overlap With Shared Savings Models and Programs
d. Payment Reconciliation of Overlap With Non-ACO CMS Models and
Programs
7. Limits or Adjustments to EPM Participants' Financial
Responsibility
a. Overview
b. Limit on Actual EPM-Episode Payment Contribution to Repayment
Amounts and Reconciliation Payments
(1) Limit on Actual EPM-Episode Payment Contribution to
Repayment Amounts
(2) Limitation on Reconciliation Payments
c. Additional Protections for Certain EPM Participants
(1) Policies for Certain EPM Participants to Further Limit
Repayment Responsibility
(2) Considerations for Hospitals Serving a High Percentage of
Potentially Vulnerable Populations
d. Application of Stop-Gain and Stop-Loss Limits
e. EPM Participant Responsibility for Increased Post-Episode
Payments
8. Appeals Process
a. Overview
b. Notice of Calculation Error (First Level Appeal)
c. Dispute Resolution Process (Second Level of Appeal)
d. Exception to the Notice of Calculation Error Process and
Notice of Termination
e. Limitations on Review
E. EPM Quality Measures, Public Display, and Use of Quality
Measures in the EPM Payment Methodology
1. Background
2. Selection of Quality Measures for the EPMs
a. Overview of Quality Measure Selection
b. AMI Model Quality Measures
c. CABG Model Quality Measures
d. SHFFT Model Quality Measures
3. Use of Quality Measures in the EPM Payment Methodologies
a. Overview of EPM Composite Quality Score Methodology
b. Determining Quality Measure Performance
c. Determining Quality Measure Improvement
d. Determining Successful Submission of Voluntary Data for AMI
and SHFFT Models
(1) Hybrid AMI Mortality (NQF #2473) Voluntary Data
(2) Patient-Reported Outcomes and Limited Risk Variable
Voluntary Data Following Elective Primary THA/TKA
e. Calculation of the EPM-Specific Composite Quality Score
(1) AMI Model Composite Quality Score
(2) CABG Model Composite Quality Score
(3) SHFFT Model Composite Quality Score
f. EPM Pay-for-Performance Methodologies To Link Quality and
Payment
(1) Overview of Pay-for-Performance Proposals Applicable to the
EPMs
(2) AMI and CABG Model Pay-for-Performance Methodology
(a) AMI Model Pay-for-Performance Methodology
(b) CABG Model Pay-for-Performance Methodology
(c) Alignment Between the AMI and CABG Model Methodologies
(3) SHFFT Model Pay-for-Performance Methodology
4. Details on Quality Measures for the EPMs
a. AMI Model-Specific Measures
(1) Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate
Following Acute Myocardial Infarction (AMI) Hospitalization (NQF
#0230) (MORT-30-AMI)
(a) Background
(b) Data Sources
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Risk-Adjustment
(f) Calculating the Risk-Standardized Mortality Ratio (RSMR) and
Performance Period
(2) Excess Days in Acute Care After Hospitalization for Acute
Myocardial Infarction (AMI Excess Days)
(a) Background
(b) Data Sources
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Risk-Adjustment
(f) Calculating the Rate and Performance Period
(3) Hybrid Hospital 30-Day, All-Cause, Risk-Standardized
Mortality Rate Following Acute Myocardial Infarction (AMI)
Hospitalization (NQF #2473) (Hybrid AMI Mortality)
(a) Background
(b) Data Sources
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Risk-Adjustment
(f) Calculating the Risk-Standardized Mortality Ratio (RSMR) and
Performance Period
(g) Requirements for Successful Submission of AMI Voluntary Data
b. CABG Model-Specific Measure
(1) Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate
(RSMR) Following Coronary Artery Bypass Graft (CABG) Surgery (NQF
#2558) (MORT-30-CABG)
(a) Background
(b) Data Source
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Risk-Adjustment
(f) Calculating the Risk-Standardized Mortality Ratio (RSMR) and
Performance Period
c. SHFFT Model-Specific Measures
(1) Hospital Level Risk Standardized Complication Rate (RSCR)
Following Elective Primary Total Hip Arthroplasty (THA) and/or Total
Knee Arthroplasty (TKA) (NQF #1550) (Hip/Knee Complications)
(a) Background
(b) Data Sources
[[Page 183]]
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Risk Adjustment
(f) Calculating the Risk Standardized Complication Rate and
Performance Period
(2) Hospital-Level Performance Measure(s) of Patient-Reported
Outcomes Following Elective Primary Total Hip and/or Total Knee
Arthroplasty
(a) Background
(b) Data Sources
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Outcome
(f) Risk Adjustment (If Applicable)
(g) Calculating the Risk Standardized Rate
(h) Performance Period for Successful Submission of THA/TKA
Patient-Reported Outcome-Based Voluntary Data
(i) Requirements for Successful Submission of THA/TKA Patient-
Reported-Outcome-Based Voluntary Data
d. Measure Used for All EPMs
(1) Hospital Consumer Assessment of Healthcare Providers and
Systems (HCAHPS) Survey (NQF #0166)
(a) Background
(b) Data Sources
(c) Cohort
(d) Inclusion and Exclusion Criteria
(e) Case-Mix Adjustment
(f) HCAHPS Scoring
(g) Calculating the Rate and Performance Period
e. Potential Future Measures
5. Form, Manner, and Timing of Quality Measure Data Submission
6. Display of Quality Measures and Availability of Information
for the Public From the AMI, CABG, and SHFFT Models
F. Compliance Enforcement and Termination of an Episode Payment
Model
1. Overview and Background
2. Compliance Enforcement for EPMs
3. Termination of an Episode Payment Model
G. Monitoring and Beneficiary Protection
1. Introduction and Summary
2. Beneficiary Choice
3. Beneficiary Notification
4. Monitoring for Access To Care
5. Monitoring for Quality of Care
6. Monitoring for Delayed Care
H. Access to Records and Record Retention
I. Financial Arrangements Under EPM
1. Background
2. Overview of the EPM Financial Arrangements
3. EPM Collaborators
4. Sharing Arrangements Under EPM
a. General
b. Requirements
c. Gainsharing Payment, Alignment Payment, and Internal Cost
Savings Conditions and Restrictions
d. Documentation Requirements
5. Distribution Arrangements Under the EPM
a. General
b. Requirements
6. Downstream Distribution Arrangements Under the EPM
a. General
b. Requirements
7. Summary of Proposals for Sharing, Distribution, and
Downstream Distribution Arrangements Under the EPM
8. Enforcement Authority
9. Beneficiary Engagement Incentives Under the EPM
a. General
b. Technology Provided to an EPM Beneficiary
c. Clinical Goals of the EPM
d. Documentation of Beneficiary Incentives
10. Compliance With Fraud and Abuse Laws
J. Waivers of Medicare Program Requirements
1. Overview
2. Summary of Waivers Adopted Under the CJR Model
3. Analysis of Current Model Data
a. Analysis of Waiver Usage
b. Analysis of Discharge Destination--Post-Acute Care Usage
c. Analysis of Hospital Mean Length of Stay Data
4. Post-Discharge Home Visits
a. AMI Model
b. CABG Model
c. SHFFT Model
5. Billing and Payment for Telehealth Services
6. SNF 3-Day Rule
a. Waiver of SNF 3-Day Rule
b. Additional Beneficiary Protections Under the SNF 3-Day Stay
Rule Waiver
7. Waivers of Medicare Program Rules To Allow Reconciliation
Payment or Repayment Actions Resulting From the Net Payment
Reconciliation Amount
8. New Waiver for Providers and Suppliers of Cardiac
Rehabilitation and Intensive Cardiac Rehabilitation Services
Furnished to EPM Beneficiaries During an AMI or CABG Episode
K. Data Sharing
1. Overview
2. Beneficiary Claims Data
3. Aggregate Regional Data
4. Timing and Period of Baseline Data
5. Frequency and Period of Claims Data Updates for Sharing
Beneficiary-Identifiable Claims Data During the Performance Period
6. Legal Permission To Share Beneficiary-Identifiable Data
7. Data Considerations With Respect to EPM and CJR Collaborators
L. Coordination With Other Agencies
IV. Evaluation Approach
A. Background
B. Design and Evaluation Methods
C. Data Collection Methods
D. Key Evaluation Research Questions
E. Evaluation Period and Anticipated Reports
V. Comprehensive Care for Joint Replacement Model
A. Participant Hospitals in the CJR Model
B. Inclusion of Reconciliation and Repayment Amounts When
Updating Data for Quality-Adjusted Target Prices
C. Quality-Adjusted Target Price
D. Reconciliation
1. Hospital Responsibility for Increased Post-Episode Payments
2. ACO Overlap and Subsequent Reconciliation Calculation
3. Stop-Loss and Stop-Gain Limits
4. Modifications to Reconciliation Process
E. Use of Quality Measures and the Composite Quality Score
1. Hospitals Included in Quality Performance Distribution
2. Quality Improvement Points
3. Relationship of Composite Quality Score to Quality Categories
4. Maximum Composite Quality Score
5. Acknowledgement of Voluntary Data Submission
6. Calculation of the HCAHPS Linear Mean Roll-Up (HLMR) Score
F. Accounting for Overlap With CMS ACO Models and the Medicare
Shared Savings Program
G. Appeals Process
H. Beneficiary Notification
I. Compliance Enforcement
1. Failure To Comply
J. Financial Arrangements Under the CJR Model
1. Definitions Related to Financial Arrangements
a. Addition to the Definition of CJR Collaborators
b. Deleting the Term Collaborator Agreements
c. Addition of CJR Activities
2. Sharing Arrangements
a. General
b. Requirements
c. Gainsharing Payment, Alignment Payment, and Internal Cost
Savings Conditions and Restrictions
d. Documentation
3. Distribution Arrangements
a. General
b. Requirements
4. Downstream Distribution Arrangements Under the CJR Model
a. General
b. Requirements
5. Summary of Proposals for Sharing, Distribution, and
Downstream Distribution Arrangements Under the CJR Model
K. Beneficiary Incentives Under the CJR Model
L. Access to Records and Record Retention
M. Waivers of Medicare Program Rules To Allow Reconciliation
Payment or Repayment Actions Resulting From the Net Payment
Reconciliation Amount
N. SNF 3-Day Waiver Beneficiary Protections
O. Advanced Alternative Payment Model Considerations
1. Overview for CJR
2. CJR Participant Hospital Track
3. Clinician Financial Arrangements Lists Under the CJR Model
4. Documentation Requirements
VI. Cardiac Rehabilitation Incentive Payment Model
A. Background
B. Overview of the CR Incentive Payment Model
1. Rationale for the CR Incentive Payment Model
2. General Design of the CR Incentive Payment Model
C. CR Incentive Payment Model Participants
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D. CR/ICR Services That Count Towards CR Incentive Payments
E. Determination of CR Incentive Payments
1. Determination of CR Amounts That Sum To Determine a CR
Incentive Payment
2. Relation of CR Incentive Payments to EPM Pricing and Payment
Policies and Sharing Arrangements for EPM-CR Participants
3. CR Incentive Payment Report
4. Timing for Making CR Incentive Payments
F. Provisions for FFS-CR Participants
1. Access to Records and Retention for FFS-CR Participants
2. Appeals Process for FFS-CR Participants
a. Overview
b. Notice of Calculation Error (First Level Appeal)
c. Dispute Resolution Process (Second Level of Appeal)
d. Exception to the Notice of Calculation Error Process and
Notice of Termination
e. Limitations on Review
3. Data Sharing for FFS-CR Participants
a. Overview
b. Data Sharing With CR Participants
4. Compliance Enforcement for FFS-CR Participants and
Termination of the CR Incentive Payment Model
5. Enforcement Authority for FFS-CR Participants
6. Beneficiary Engagement Incentives for FFS-CR Participants
7. Waiver of Physician Definition for FFS-CR Participants
Furnishing CR and ICR Services
a. Overview of Program Rule Waivers Under an EPM
b. General Physician Requirements for Furnishing CR/ICR Services
c. Waiver of Physician Definition For EPM-CR Participants
Furnishing CR and ICR Services
d. Waiver of Physician Definition For FFS-CR Participants
Furnishing CR and ICR Services
G. Considerations Regarding Financial Arrangements Under the CR
Incentive Payment Model
VII. Collection of Information Requirements
VIII. Regulatory Impact Analysis
A. Statement of Need
1. Need for EPM Final Rule
2. Need for CJR Modifications
3. Need for CR Incentive Payment Model
4. Aggregate Impact of EPMs, CJR, and CR Incentive Payment Model
B. Overall Impact
C. Anticipated Effects
1. Overall Magnitude of the Model and Its Effects on the Market
a. EPMs
b. CJR
c. CR Incentive Payment Model
d. Aggregate Effects on the Market
2. Effects on the Medicare Program
a. EPMs
(1) Assumptions and Uncertainties
(2) Analyses
(3) Uncertainties
b. CJR
(1) Assumptions and Uncertainties
(2) Analyses
c. CR Incentive Payment Model
(1) Assumptions and Uncertainties
(2) Analysis
d. Further Consideration
3. Effects on Beneficiaries
4. Effects on Small Rural Hospitals
5. Effects on Small Entities
6. Effects on Collection of Information
7. Unfunded Mandates
D. Alternatives Considered
E. Accounting Statement and Table
F. Conclusion
Regulations Text
I. Executive Summary
A. Purpose
The purpose of this final rule--Advancing Care Coordination through
Episode Payment Models is to implement the creation and testing of
three new episode payment models (EPMs) and a Cardiac Rehabilitation
(CR) incentive payment model under the authority of the Center for
Medicare and Medicaid Innovation (``the Innovation Center''), as well
as to implement several modifications to the Comprehensive Care for
Joint Replacement model. Section 1115A of the Social Security Act
(``the Act'') authorizes the Innovation Center to test innovative
payment and service-delivery models to reduce Medicare, Medicaid, and
Children's Health Insurance Program (CHIP) expenditures while
preserving or enhancing the quality of care furnished to such programs'
beneficiaries. Under the fee-for-service (FFS) program, Medicare makes
separate payments to providers and suppliers for the items and services
furnished to a beneficiary over the course of treatment (an episode of
care). With the amount of payments dependent on the volume of services
delivered, providers may not have incentives to invest in quality-
improvement and care-coordination activities. As a result, care may be
fragmented, unnecessary, or duplicative. The goal for the EPMs is to
improve the quality of care provided to beneficiaries in an applicable
episode while reducing episode spending through financial
accountability.\1\ The EPMs include models for episodes of care
surrounding an acute myocardial infarction (AMI), coronary artery
bypass graft (CABG), and surgical hip/femur fracture treatment
excluding lower extremity joint replacement (SHFFT). Under this final
rule, the Centers for Medicare & Medicaid Services (CMS) will test
whether an EPM for AMI, CABG, and SHFFT episodes of care will reduce
Medicare expenditures while preserving or enhancing the quality of care
for Medicare beneficiaries. We anticipate that the finalized models
will benefit Medicare beneficiaries by improving the coordination and
transition of care, improving the coordination of items and services
paid for through FFS Medicare, encouraging more provider investment in
infrastructure and redesigned care processes for higher-quality and
more efficient service delivery, and incentivizing higher-value care
across the inpatient and post-acute care spectrum. We proposed on
August 2, 2016 to test the proposed EPMs for 5 performance years,
beginning July 1, 2017, and ending December 31, 2021 (81 FR 50799) and
we are finalizing those dates as proposed in this final rule.
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\1\ In this final rule, we use the terms ``AMI episode,'' ``CABG
episode,'' and ``SHFFT episode'' to refer to episodes of care as
described in section III.C. of this final rule.
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Within this final rule, we discuss three distinct EPMs focused on
episodes of care for AMI, CABG, and SHFFT episodes. We chose these
episodes for the models because, as discussed in depth in section
III.A. of this final rule and as stated in the proposed rule, we
believe hospitals would have a significant opportunity to redesign care
and to improve the quality of care furnished during the applicable
episode. The EPMs will enable hospitals to consider the most
appropriate strategies for care redesign, including: (1) Increasing
post-hospitalization follow-up and medical management for patients; (2)
coordinating across the inpatient and post-acute care spectrum; (3)
conducting appropriate discharge planning; (4) improving adherence to
treatment or drug regimens; (5) reducing readmissions and complications
during the post-discharge period; (6) managing chronic diseases and
conditions that may be related to the EPMs' episodes; (7) choosing the
most appropriate post-acute care setting; and (8) coordinating between
providers and suppliers such as hospitals, physicians, and post-acute
care providers. The EPMs would offer hospitals the opportunity to
examine and better understand their own care processes and patterns
with regard to patients in AMI, CABG, and SHFFT episodes, as well as
the processes of post-acute care providers and physicians.
We previously have used our statutory authority under section 1115A
of the Act to test other episode payment models such as the Bundled
Payments for Care Improvement (BPCI) initiative and Comprehensive Care
for Joint Replacement (CJR) model. Bundled payments for multiple
services in an episode of care hold participating organizations
financially accountable for that episode of care. Such models also
allow participants to receive payments based in part on the reduction
in Medicare expenditures that arise
[[Page 185]]
from such participants' care redesign efforts. This payment can be used
for investments in care redesign strategies and infrastructure, as well
as to incentivize collaboration with other providers and suppliers
furnishing services to beneficiaries included in the models.
We believe the EPMs will further the Innovation Center's mission
and the Administration's goal of increasingly paying for value and
outcomes, rather than for volume alone,\2\ by promoting the alignment
of financial and other incentives for all health care providers caring
for beneficiaries during SHFFT, CABG, or AMI episodes. The acute care
hospital where an eligible beneficiary has a hospitalization for one of
the procedures or clinical conditions included in these EPMs will be
held accountable for spending during the episode of care. EPM
participants could earn reconciliation payments by appropriately
reducing expenditures and meeting certain quality metrics. EPM
participants will also gain access to data and educational resources to
better understand care patterns during the inpatient hospitalization
and post-acute periods, as well as associated spending. Payment
approaches that reward providers for assuming financial and performance
accountability for a particular episode of care create incentives for
the implementation and coordination of care redesign between
participants and other providers and suppliers such as physicians and
post-acute care providers.
The AMI, CABG, and SHFFT models will require the participation of
hospitals in multiple geographic areas that might not otherwise
participate in testing episode payment for the episodes of care. CMS is
testing other episode payment models with the BPCI initiative and the
CJR model. The BPCI initiative is voluntary; providers applied to
participate and chose from 48 clinical episodes. BPCI participants
entered the at-risk phase between 2013 and 2015 and have the option to
continue participating in the initiative through FY 2018. In the CJR
model, acute care hospitals in selected geographic areas are required
to participate in the CJR model for all eligible lower-extremity joint
replacement (LEJR) episodes that initiate at a CJR participant
hospital. The CJR model began its first of 5 performance years on April
1, 2016. Realizing the full potential of new EPMs will require the
engagement of an even broader set of providers than have participated
to date in our episode payment models such as the BPCI initiative and
the CJR model. As such, we are interested in testing and evaluating the
impact of episode payment for the three EPMs in a variety of
circumstances, including those hospitals that may not otherwise
participate in such a test.
While we note that testing of the CJR model that began in April
2016 will allow CMS to gain experience with requiring hospitals to
participate in an episode payment model, the clinical circumstances of
the episodes we proposed (AMI, CABG, and SHFFT) differ in important
ways from the LEJR episodes included in the CJR model. LEJR procedures
are common among the Medicare population, and the majority of such
procedures are elective. In contrast, under the three EPMs, CMS will
test episode payment for certain cardiac conditions and procedures, as
well as SHFFT. We expect the patient population included in these
episodes will be substantially different from the patient population in
CJR episodes, due to the clinical nature of the cardiac and SHFFT
episodes. Beneficiaries in these episodes commonly have chronic
conditions that contribute to the initiation of the episodes, and need
both planned and unplanned care throughout the EPM episode following
discharge from the hospitalization that begins the episode. Both AMI
and CABG model episodes primarily include beneficiaries with
cardiovascular disease, a chronic condition which likely contributed to
the acute events or procedures that initiate the episodes. About half
the average AMI model historical episode spending was for the
hospitalization, with the majority of spending following discharge from
the hospitalization due to hospital readmissions, while there was
relatively less spending on SNF services, Part B professional services,
and hospital outpatient services. In CABG model historical episodes,
about three-quarters of episode spending was for the hospitalization,
with the remaining episode spending relatively evenly divided between
Part B professional services and hospital readmissions, and a lesser
percentage on SNF services. Similar to AMI episodes, post-acute care
provider use was relatively uncommon in CABG model historical episodes,
while hospital readmissions during CABG model historical episodes were
relatively common. SHFFT model historical episodes also were
accompanied by substantial spending for hospital readmissions, and
post-acute care provider use in these episodes also was high.\2\ The
number of affected beneficiaries and potential impact of the models on
quality and Medicare spending present an important opportunity to
further the Administration's goal of shifting health care payments to
support the quality of care over the quantity of services by promoting
better coordination among health care providers and suppliers and
greater efficiency in the care of beneficiaries in these models, while
reducing Medicare expenditures.\3\ Pay-for-performance episode payment
models such as the three EPMs in this rule financially incentivize
improved quality of care and reduced cost by aligning the financial
incentives of all providers and suppliers caring for model
beneficiaries with these goals. This alignment leads to a heightened
focus on care coordination and management throughout the episode that
prioritizes the provision of those items and services which improve
beneficiary outcomes and experience at the lowest cost. A more detailed
discussion of the evidence supporting the episode selection for these
models can be found in section III.A.1. of this final rule.
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\2\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated by
all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in this
rule that end in CY 2014.
\3\ Sylvia Mathews Burwell, HHS Secretary, Progress Towards
Achieving Better Care, Smarter Spending, Healthier People, http://www.hhs.gov/blog/2015/01/26/progress-towards-better-care-msarter-spending-healthier-people.html (January 26, 2015).
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These models will also allow CMS to gain additional experience with
episode-payment based approaches for hospitals with variance in (1)
historic care and utilization patterns; (2) patient populations and
care patterns; (3) roles within their local markets; (4) volumes of
services; (5) levels of access to financial, community, or other
resources; and (6) levels of population and health-care-provider
density, including local variations in the availability and use of
different categories of post-acute care providers. We believe that
participation in the EPMs by a large number of hospitals with diverse
characteristics will result in a robust data set for evaluating this
payment approach and will stimulate the rapid development of new
evidence-based knowledge. Testing the EPMs in this manner will also
allow us to learn more about patterns of inefficient utilization of
health care services and how to incentivize quality improvement for
beneficiaries receiving services in AMI, CABG, and SHFFT episodes. This
knowledge could potentially inform future Medicare payment policies.
We proposed the CR incentive payment model to test the effects on
[[Page 186]]
quality of care and Medicare expenditures of providing financial
incentives to hospitals for beneficiaries hospitalized for treatment of
AMI or CABG to encourage care coordination and greater utilization of
medically necessary CR and intensive cardiac rehabilitation (ICR)
services for 90 days post-hospital discharge where the beneficiary's
overall care is paid under either an EPM or the Medicare FFS program.
Despite the evidence from multiple studies that CR services improve
health outcomes, the literature also indicates that these services are
underutilized, estimating that only about 35 percent of AMI patients
older than 50 receive this indicated treatment.4 5 6 Recent
analysis confirms a similar pattern of underutilization for Medicare
beneficiaries who are eligible for and could benefit from CR.
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\5\ Anderson L. et al. Exercise-based cardiac rehabilitation for
coronary heart disease. Cochrane Database Syst Rev. 2016 Jan
5;1:CD001800.
\6\ Receipt of outpatient cardiac rehabilitation among heart
attack survivors--United States, 2005. MMWR Morbidity and mortality
weekly report. 2008 Feb 1:57(4):89-94.
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Considering the evidence demonstrating that CR/ICR services improve
long-term patient outcomes, the room for improvement in CR/ICR service
utilization for beneficiaries eligible for this benefit, and the need
for ongoing, chronic treatment for underlying coronary artery disease
(CAD) among beneficiaries that have had an AMI or a CABG, we believe
that there is a need for improved long-term care management and care
coordination for beneficiaries that have had an AMI or a CABG and that
incentivizing the use of CR/ICR services is an important component of
meeting this need. We want to reduce barriers to high-value care by
testing a financial incentive for hospitals that encourages the
management of beneficiaries that have had an AMI or a CABG in ways that
may contribute to long-term improvements in quality and reductions in
Medicare spending.
We sought public comment on the proposals contained in the proposed
rule (81 FR 50794) published on August 2, 2016, and also on any
alternatives considered. Public comment and our responses to those
comments follow under the applicable sections. The applicable sections
contain our proposed policy changes, commenters' reactions, and our
responses.
We received approximately 175 timely pieces of correspondence
containing multiple comments on the EPM proposed rule. We note that
some of these public comments were outside of the scope of the proposed
rule. These out-of-scope public comments are mentioned in this section
but are not addressed with the policy responses in this final rule. The
following is a summary of the comments received on the proposed model
as a whole, including the authority for the model and general comments
on CMS' implementation of the EPM model at this time and our responses.
Comment: Some commenters expressed support for the proposed EPMs
and for requiring participation from specific hospitals in the selected
geographic regions. Other commenters requested whether CMS has the
authority under section 1115A of the Social Security Act (the Act) to
implement the EPMs as proposed, while others stated specifically that
they believe CMS cannot compel provider participation and further
stated that they did not believe Congress intended to delegate its
authority to make permanent changes to the Medicare program to the
Secretary through the Innovation Center.
Many commenters raised concerns that interpreting section 1115A to
mean that requiring participation in models is permissible under
statute holds significant implications for the patients and providers
included in the proposed EPMs, as required models could negatively
impact the Medicare Shared Savings Program (Shared Savings Program)
and/or Accountable Care Organizations (ACOs).
Response: While we appreciate the support expressed by some
commenters, we disagree with the contention that the Innovation Center
lacks the authority to test models under section 1115A of the Act in
which participation is required. Section 1115A of the Act authorizes
the Secretary to test innovative payment and service delivery models to
reduce program expenditures while preserving or enhancing the quality
of care furnished to Medicare, Medicaid, and Children's Health
Insurance Program (CHIP) beneficiaries, and section 1115A of the Act
does not specify that participation in models must be voluntary. As
discussed in section IV. of this final rule, one of the reasons that we
have determined it is necessary to test the EPM models by requiring the
participation of certain hospitals is to obtain more generalizable
evaluation results.
Moreover, the Secretary has authority to establish regulations to
carry out the administration of Medicare. Specifically, the Secretary
has authority under both sections 1102 and 1871 of the Act to implement
regulations as necessary to administer Medicare, including testing
these Medicare payment and service delivery models. We note that the
EPMs will test different methods for delivering and paying for services
covered under the Medicare program, which the Secretary has clear legal
authority to regulate.
To be clear, we did not propose, and are not finalizing, permanent
changes to Medicare, but rather are testing payment and service
delivery models under section 1115A(b) of the Act. While the EPMs
require the participation of certain participant hospitals, the EPMs
are not permanent changes to the Medicare program. We acknowledge the
importance of examining the impact of the EPMs as this test will
implement models at the geographic regional level. The EPMs are thus
intended to enable CMS to test and evaluate the effects of episode
payment approaches on a broader range of Medicare providers and
suppliers than would choose to participate in an alternative payment
model. More specifically, the evaluation is to conduct a multifaceted
and multi-pronged examination of issues of quality, access, and
consequences. Randomized evaluation designs of this kind helps to
reduce the systematic differences among hospitals that are and are not
participating in the EPMs, which helps to ensure that, on average,
differences in outcomes between participating and non-participating
hospitals reflect the impact of the model. Testing these models in this
manner also allows us to learn more about patterns of inefficient
utilization of health care services and how to incentivize the
improvement of quality for AMI, CABG, and SHFFT procedure/diagnosis
episodes. This learning can potentially inform future Medicare payment
policy.
We do not believe the EPMs will harm the continuation of a
permanent Medicare program such as the Shared Savings Program, We
continue to believe that while we test the EPMs, ACOs will still work
towards the goals of the Shared Savings Program. These goals have been
previously described (76 FR 67801) and include ensuring the
coordination of care for beneficiaries, regardless of the time or place
of that care, being innovative in service delivery by drawing upon the
best, most advanced models of care, and using modern technologies,
including telehealth and electronic health records, and other tools to
continually reinvent care in the modern age.
We refer to our discussion about ACO overlap with the proposed EPMs
that was included in the proposed rule (81 FR 50870) and acknowledge
the concerns expressed by some ACOs that the current CJR and BPCI ACO
overlap
[[Page 187]]
policies deprive them of a key source of savings. Because ACOs in
certain types of two-sided risk arrangements have stronger incentives
than those in one-sided risk arrangements to reduce total cost of care,
especially given the possibility of paying CMS shared losses, we
believe that ACOs in such two-sided risk arrangements may be best
positioned to assume the risk associated with EPM episodes, while ACOs
in one-sided risk arrangements may be less well-positioned to do so.
Furthermore, it is more operationally feasible to identify and exclude
beneficiaries who are prospectively aligned to ACOs.
Comment: One commenter believed that the EPMs did not satisfy the
requirement that the model address ``a defined population for which
there are deficits in care leading to poor clinical outcomes or
potentially avoidable costs'' as is required by section 1115A(b)(2)(A)
of the Act.
Response: Models tested under section 1115A of the Act must address
a defined population for which there are either deficits in care
leading to poor clinical outcomes or potentially avoidable
expenditures. As discussed in section III.C. of the proposed rule (81
FR 50829-50843) and section III.C. of this final rule, these models
satisfy the requirements of section 1115A(b) of the Act, as the EPMs
address defined populations (FFS Medicare beneficiaries experiencing
acute myocardial infarctions, coronary artery bypass grafting
procedures and/or surgical hip/femur fracture treatment) for which
there are potentially avoidable expenditure because there are no strong
incentives for coordinated care, which can lead to suboptimal care. As
discussed in section IV. of this final rule, one of the reasons that we
have determined it is necessary to require the participation of
hospitals in multiple geographic areas that might not otherwise
participate in testing episode payment for the episodes of care is to
provide more generalizable evaluation results of the impacts of these
models.
Comment: A few commenters asserted that the SHFFT model is
equivalent to an expansion of the CJR model under section 1115A(c) of
the Act. The same commenters stated that the SHFFT EPM model test
should not be finalized in this rule as the CJR model has not yet
satisfied the requirements of section 1115A(c) of the Act. One
commenter stated that before implementing the SHFFT EPM, CMS must first
complete the evaluation of the CJR model required under section
1115A(b)(4) of the Act; make the determinations required under section
1115A(c)(1) and (3) of the Act; and receive the certification from the
Chief Actuary required under section 1115A(c)(2) of the Act.
Response: Regarding the commenters' assertion that the proposed
SHFFT model expands the CJR model prior to the CJR evaluation, we note
that this is not the case. We agree that section 1115A of the Act
establishes the necessary criteria for the Secretary to expand payment
and service delivery models. However, the SHFFT model we are finalizing
in this rule is not an expansion of the CJR model under section
1115A(c) of the Act. Rather, the SHFFT EPM model is a new model test
under section 1115A(b) of the Act. The CJR model is still at the
initial model test stage, and we will not make any determinations about
continuing the CJR model test through expansion under section 1115A(c)
of the Act until there is sufficient information from evaluation(s) to
assess its potential for expansion. While the SHFFT EPM model test
complements the CJR model test, it is a separate and distinct model
test. Specifically, the SHFFT model differs from the CJR model in that
the CJR model is largely for planned admissions for hip and knee
replacements and the episode of care begins with an admission to a
participant hospital of a beneficiary who is ultimately discharged
under MS-DRG 469 (Major joint replacement or reattachment of lower
extremity with major complications or comorbidities) or 470 (Major
joint replacement or reattachment of lower extremity without major
complications or comorbidities). In contrast, the SHFFT model tests a
hospital payment for hip fixation and the episode of care eventually
results from a discharge paid under MS-DRG 480 (Hip and femur
procedures except major joint with major complication or comorbidity--
CC), MS-DRG 481 (Hip and femur procedures except major joint with
complication or comorbidity--MCC), or MS-DRG 482 (Hip and femur
procedures except major joint without CC or MCC). Therefore, the
interventions under each model test would not overlap. Further, the
SHFFT model test would give hospitals already participating in the CJR
model different experience in managing care for hip and femur fracture
cases that typically present emergently, rather than the planned,
elective surgery that is most common for lower extremity joint
replacement. Despite this geographic overlap, beneficiaries who
initiate an episode in either the SHFFT or CJR model remain in that
initial model and are precluded from initiating a simultaneous episode
in the CJR or SHFFT models respectively. As a result, the evaluations
of the CJR model and the SHFFT model will assess the effect of discrete
episodes.
Comment: Some commenters expressed support for the intended goals
of the EPMs, and stated they want to contribute to moving our health
care system to a value-based system. However, many commenters disagreed
with the process used by CMS to achieve this goal. Specifically,
commenters stated that CMS moved too fast and too soon in implementing
these models. Furthermore, commenters believe that the breadth and
speed of the CMS models expanded exponentially. Commenters stated that
in situations when multiple initiatives are being implemented
simultaneously, for example Meaningful Use, new conditions of
participation for emergency preparedness, multiple clinical and payment
changes to the existing fee-for-service payment systems, performance
requirements of payment reforms such as the MACRA, and state regulatory
changes to health care, commenters stated that hospitals may have
little time or resources available for thoughtful care redesigns to be
applied to the proposed model. A few commenters noted that the
insurance marketplace in general remains volatile, adding further
complication to the health care landscape, while others believe
generally that CMS is putting the existing initiatives' success at risk
as a result of the proposed pace of implementation of new programs and
models.
Commenters raised concerns that they were unable to submit informed
comments on the proposed rule because they did not have sufficient data
on the CJR model, making it difficult to assess even early experience
with the process of implementation of models that require
participation. Other commenters submitted statements of experience
related to implementation of the CJR model, specifically that
implementation was administratively challenging due to the need to
first develop a process of care redesign and then implement operational
changes related to efficiency as well as specific provisions of the
model, including but not limited to collaboration agreements,
provisions for beneficiary notifications, and data analysis. As a
result of this experience, commenters requested that CMS delay the
implementation time line of the EPMs. The alternative time lines
proposed by commenters varied. A few commenters stated that it would be
unreasonable to implement a new episode payment model before
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evaluation of the outcomes and processes of existing bundled payment
models. Other commenters suggested that CMS generally delay
implementation until the agency can address concerns related to risk
adjustment, minimum volume thresholds, comprehensiveness of payment,
and episode definitions. Commenters believed that launching the
proposed models simultaneously will require an incredible
administrative effort, which may hinder the ability to effectively
direct clinical resources towards best practices for success. To this
end, commenters also suggested alternative proposals, including but not
limited to reconsideration of implementing cardiac EPMs; delay, pilot,
or narrow the scope of the proposed SHFFT model; delay the start date
of the proposed EPMs until no earlier than January 1, 2018; provide
hospitals with at least 12 months of preparation time from the date the
final rule is finalized. Other commenters believed hospitals should not
be subject to downside risk for at least 12 months from the
implementation date of the final rule, and other commenters suggested
that CMS delay the onset of downside risk beyond the first quarter of
performance year 2. Commenters suggested CMS delay implementation to
allow both CMS and EPM participants to prepare to be successful during
testing of the model. Specifically, commenters stated that CMS should
use the delay to establish a dialogue with hospitals to improve the
existing bundled payment experience, perform outcomes studies on
existing models and programs, analyze the existing CJR model to
determine the model's impact to beneficiaries' outcomes and longer term
well-being, and create infrastructure to more easily attribute patients
to the EPMs. Commenters also stated that such a delay would allow time
for EPM participants to better understand the clinical and financial
risk of their patient populations, to establish collaborator
relationships and to create the internal organization structure to
manage payment bundles. A few commenters specifically suggested changes
in payment once the risk-bearing phase begins, to allow a prospective
payment to the EPM participants upon determination of an eligible
diagnosis, as this change could permit all collaborating providers to
share in both the upside and downside financial risk, and not be
constrained by what Medicare pays for services during the episode.
Overall, most commenters requested that CMS generally apply a more
strategic process to achieve the intended goals by building on the
experience to date to set the health care system on a pathway to
success rather than rolling out new models before anything concrete is
gleaned from existing models.
Response: We appreciate the comments we received in support of our
proposed performance period and start date. We also appreciate comments
expressing concerns around the timing of this model. Although we
believe that it is important to initiate these EPMs now since they are
different than CJR and BPCI and will provide essential information
about the potential for episode payment to improve care and lower
spending, we are sensitive to commenters' concerns that our proposed
date to implement downside risk may not provide sufficient time for
participants to implement the kinds of changes needed to successfully
participate in the model, particularly given the availability of
baseline data. Accordingly, this final rule will increase available
preparation time by not implementing downside risk for all participants
in the EPMs until October 1, 2018. Downside risk for EPM episodes will
be applied to episodes ending on or after January 1, 2019. As discussed
in detail in section III.D. of this final rule, participants who are
interested in taking on downside risk earlier can choose to begin
downside risk for episodes ending on or after January 1, 2018.
Additionally, specific amendments to the regulations regarding the CJR
model access to records and records retention policy, compliance
enforcement policy, and waiver of the SNF 3 day rule will take effect
July 1, 2017. We refer readers to sections V.H., V.I., and V.L. of the
final rule for discussions of our final decisions. We believe that
these changes will both facilitate participants' abilities to be
successful under these models and allow for a more gradual transition
to full financial responsibility under the models. CMS will also
continue to work internally to determine the extent to which the
suggestions submitted by commenters, including performing education and
outreach activities or outcomes studies on existing models, will impact
the implementation of the EPMs. The EPMs will only include a limited
number of episode types, and as such we believe it is reasonable for
hospitals to begin to analyze data and identify care patterns and
opportunities for care redesign for these episodes prior to assuming
financial responsibility for spending for episode beginning after
October 1, 2018. We also note that due to the gradual implementation of
financial responsibility that was proposed and that will still be
incorporated in the models even given the start of the phased-in
downside risk that we are finalizing in this rule, we expect that
hospitals will spend the first performance year of the model analyzing
data, identifying care pathways, forming clinical and financial
relationships with other providers and suppliers, and assessing
opportunities for savings under the model, utilizing in part the claims
data we provide to them. As a result of these changes, we do not
believe that further changes are needed to the start date of
implementation. We also do not agree with commenters that
implementation of the model is premature or that it should not be
implemented until results for CJR or other episode-based payment models
are available. While we anticipate that these models will offer
valuable information that should assist CMS in developing future
episode payment models, the EPMs will offer additional insights that
are not available under the CJR model; in particular, insights with
respect to episode payment models on a distinct set of episodes for
participants that would not otherwise participate under a model such as
BPCI.
Likewise, we do not agree that the models should be implemented
after certain other actions have occurred or because of the multiple
competing mandates faced by hospitals and other providers. Since the
Medicare program's inception, providers have and will continue to
contend with constantly evolving statutory and administrative
requirements that often require them to make concurrent changes in
their practices and procedures. We do not believe the EPMs are
dissimilar to those requirements.
Also as discussed earlier in this section, some commenters pointed
to the potential for unintended consequences that could result from our
proposed start date, including impediments to beneficiary access and
reduced quality of care. As discussed in section III.E. of this final
rule, we are including quality measures for purposes of evaluating
hospitals' performance both individually and in aggregate across the
models. Also, as discussed in section III.F. of this final rule, we are
making final policies and actions to monitor both care access and
quality. We believe these features will help ensure that beneficiary
access to high quality care is not compromised under the EPMs.
Comment: Commenters raised specific concerns that the proposed
EPMs' emphasis on cost-savings could incentivize hospitals to use the
least
[[Page 189]]
costly post-acute alternative rather than the option that is most
appropriate for the beneficiary. Furthermore, commenters stated that
under an episode payment structure, EPM participants that admit
healthier patients would have better financial results. Some commenters
believe this design will consequently impact Medicare beneficiaries and
the Medicare Trust Fund by increasing the frequency of Medicare
payments from participants initiating a higher volume of episodes in a
healthier population of beneficiaries. Other commenters believed that
the proposed regulation would have serious negative impacts on Medicare
beneficiaries by encouraging unnecessary surgeries and on health care
stakeholders by discouraging innovation. One commenter encouraged us to
create a patient advisory panel so that beneficiary viewpoints could be
incorporated into model planning for the EPMs and any other Innovation
Center bundled payment models.
Response: We appreciate the commenters' concerns regarding the
quality of care for Medicare beneficiaries. Improving the quality of
care is a central goal of the Innovation Center's work to test new
payment and service delivery models. We disagree with commenters that
the models will negatively impact the quality of care for beneficiaries
in these models and we refer readers to the monitoring and beneficiary
protections discussion in section III.G. of this final rule which we
believe will address the commenters' concerns about care stinting. We
emphasize that care stinting or denying the provision of medically
necessary care is not permitted under the EPMs. Medicare beneficiaries
in the EPMs will retain the right to obtain health services from any
individual or organization qualified to participate in the Medicare
program, and EPM participants are required to supply beneficiaries with
written information regarding the design and implications of these
models as well as the beneficiaries' rights under Medicare, including
their right to use their providers of choice. We disagree with
commenters that the EPMs will stifle innovation for care furnished
during an EPM episode. We proposed, and are finalizing in this final
rule, a payment methodology that will account for changes in care
patterns and utilization trends for EPM episodes as described in
section III.D. of this final rule and will have a monitoring contractor
actively reviewing claims and monitoring behavior of participant
providers to ensure beneficiary choice and care are not compromised by
the EPMs. The Federal Government has long recognized the important role
of the public in developing effective policies. Advisory committees are
a way of ensuring public and expert involvement and advice in federal
decision-making. In compliance with the Federal Advisory Committee Act
(FACA) the number of advisory committees is carefully managed and
committee memberships reflect a balance of viewpoints, education, and
experience. Although the establishment of a Patient Advisory Committee
for all Innovation Center models is beyond the scope of this rule, we
believe that stakeholder engagement is essential to the success of
these models and our learning and monitoring contractors as well as our
evaluation contractor will be soliciting beneficiary feedback on their
experiences with the EPMs.
Comment: While some commenters appreciated the approach of CMS to
implement episode-based payment models for a select group of clinical
scenarios, others suggested that participation be voluntary, in order
to allow hospitals and providers implementing other payment reforms
like the MACRA a more gradual adoption process of EPMs. An additional
voluntary component to the proposed EPMs, commenters stated, would also
permit additional participants who are interested in the models but not
located in the MSAs in which the models will be tested to volunteer for
participation. Still, other commenters stated that single-episode
initiatives fail to encourage systemic change within organizations, and
may hinder competition if implemented. Commenters stated that as a
result of mandated participation, many surgeons who and facilities
which lack familiarity, experience, or proper infrastructure to support
care redesign efforts will hamper provider participation, bias model
performance evaluation, and negatively affect patient care. One
commenter suggested that the nature of the models will provide
information about how many organizations, and which organizations,
fail. Other commenters commended CMS for the episode payment models.
The commenters believed that this overall strategy will motivate
hospitals to work more closely with other members of the patient's care
team, which could reduce avoidable complications after surgery and
decrease the risk of additional hospitalizations.
Response: We thank the commenters for their feedback, but disagree
with the suggestion to finalize the proposed EPMs as a voluntary
initiative. The EPMs will give CMS the ability to test how an episode
payment model might function among participants that would otherwise
not participate in such a model. As such, we expect the results from
these models will produce data that are more broadly representative
than what might be achieved under a voluntary model. Also, these models
test a regional target pricing approach to consider a participant
hospital's performance relative to its regional peers. As part of this
test, we will learn whether our alternative pricing approach in these
models will better incentivize participants who are already delivering
high quality and efficient care while still incentivizing historically
less efficient providers to improve. We would not be able to test such
a regional pricing approach under a purely voluntary model, nor could
the appropriate evaluation approach be implemented if participants
could volunteer, because it is likely that only the already high
quality and efficient providers would sign up.
Comment: Many commenters supported our use of notice and comment
rulemaking for the EPMs and encouraged us to continue to use the notice
and comment rulemaking process to facilitate a robust public dialogue
on important issues related to the EPMs and the CR incentive payment
model. These commenters generally agreed with the proposed EPM
episodes. A few commenters were concerned that we would avoid notice
and comment rulemaking requirements.
Response: We appreciate the commenters' support for the use of
notice and comment rule-making for the EPM models. The EPMs are
intended to enable CMS to better understand the effects of payment
models on a broader range of Medicare providers than what is currently
being tested under the BPCI initiative. To this end, testing the EPMs
in the proposed manner will also allow us to learn more about patterns
of inefficient utilization of health care services and how to
incentivize improvement in quality for common AMI episodes.
We respectfully disagree that we are avoiding notice and comment
rulemaking. We note that the proposed rule (81 FR 50794), promulgated
in accordance with the requirements of 5 U.S.C. 553, went into great
detail about the provisions of the proposed EPMs, enabling the public
to fully understand and comment on how the proposed models were
designed and could apply to those affected providers and beneficiaries.
In this final rule, which is also being promulgated in accordance with
the requirements of 5 U.S.C. 553,
[[Page 190]]
we respond to the public comments received on our proposals, and after
considering them, we are finalizing our proposals with some
modifications.
Comment: Commenters questioned the extent to which EPM participants
would have the knowledge, skills, and experience to successfully drive
improvements in care delivery and health outcomes. Many commenters
asserted they do not have enough experience to even know where the
efficiencies in care delivery are available to take advantage of them,
which limits the ability of the EPMs' potential success. Another
commenter recommended CMS inform the participants that will be in these
episode payment models as early as possible. To this end, many
commenters recommended that CMS implement a broad-based education
campaign regarding the new EPMs that uses all of CMS' communication
channels to reach hospitals, post-acute care providers, physicians, and
community-based providers of long term services and supports.
There were many unique suggestions by commenters to appropriately
communicate the proposed EPMs to affected stakeholders. A few
commenters were generally uncertain where CMS could articulate its
vision for innovative payment models. A few other commenters believed
CMS should explain in detail the applicable EPMs, provide contact
information and a publicly accessible list of all the providers that
are part of the model in each region. Other commenters requested more
opportunity to analyze the lessons learned from Health Care Payment
Learning and Action Network (HCP-LAN), Clinical Episode Payment (CEP)
work group, and BPCI so they can be broadly applied to care redesigns
as part of the proposed EPMs. To support learning efforts, some
commenters recommended CMS to include in final regulations a
requirement that participating hospitals must develop, have approved by
CMS, and implement a comprehensive, effective clinical care model and
leadership structure for coordinating care and managing implementation
of the EPMs. A few suggested that CMS assign a Medicare Project Officer
to assist CJR and EPM participants. One commenter suggested that CMS
provide advanced education and clinical-financial tools attainable
through a blend of registries, databases and CMS claims data. Other
commenters supported the intention of CMS to establish a learning and
diffusion program.
Response: We agree with commenters regarding the need to
continually improve stakeholder outreach for models to succeed and we
intend to do as much as we can to work to design and deploy a helpful
learning and diffusion program. CMS is committed to continuing to
facilitate performance improvement by identifying areas of excellence
for the purposes of extrapolating best practices. CMS encourages
collaboration amongst organizations and can provide guidance on the
development and implementation of specific learning systems. We
currently deploy the expertise and experience of The Innovation
Center's Learning and Diffusion Group to facilitate learning within
models by disseminating the lessons learned across models so that
participants can benefit from the experiences of other models, and are
always looking for better ways to educate and assist participants in
knowledge sharing. For example, BPCI includes a shared learning network
that brings experienced stakeholders together for knowledge sharing,
collaboration, and peer-to-peer learning. We continue to believe that
these efforts contribute to reducing the administrative burden on the
health care delivery system and will be responsive to commenters'
concerns.
Comment: One commenter stated that they believe CMS should engage
in models which enhance sharing of best practices rather than financial
incentives.
Response: We appreciate the commenter's submission and agree with
the sentiment that providers of care in the EPMs should ensure quality
of care is maintained or improved. The design of the episode-based
payments directly corresponds with CMS' stated goal of decreasing costs
while maintaining or improving quality. Within this framework, we
anticipate best practices naturally evolving as participants explore
care redesign to achieve efficiencies in the episode.
Comment: Many commenters applauded many of the design features in
the new proposed models--suggesting that the proposed rule outlined the
framework for models that could become very successful at reducing
Medicare spending and improving patient care. One commenter suggested
that CMS develop accreditation standards for participation and only
select accredited EPM participants. Another commenter suggested
considering Quality Improvement Organizations (QIOs) as participants,
or that QIOs be more centrally involved in such models to continue to
recognize the importance of care transitions.
Response: We thank commenters for their support of the proposed
design features in the new proposed models. The QIO Care Transitions
Project \7\ previously tested the extent to which QIOs lead
improvements in care transitions. Research found reduced rates of 30-
day re-hospitalization and all-cause hospitalization per 1,000, however
the reduced rate of all-cause 30-day re-hospitalization as a percentage
of hospital discharges was not statistically significant. We will
continue to work internally to evaluate the extent to which QIOs
complement the operations of the EPMs. We disagree with the suggestion
to develop accreditation standards, as such actions are distinct from
testing of EPMs, and the proposal to define EPM episode initiators as
only those accredited EPM participants. The definition of the episode
initiator is discussed further in section III.B of this final rule.
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\7\ Brock J, et al., Association between quality improvement for
care transitions in communities and rehospitalizations among
Medicare beneficiaries. JAMA. 2013 Jan 23;309(4):381-91.
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As discussed in more detail in section V. of this final rule, we
proposed numerous modifications to the CJR model, which began on April
1, 2016. Section V. of this final rule contains our proposed policy
changes, commenters' reactions, and our responses. We discuss here
comments we received on the CJR model as a whole, including several
comments pertaining to model policies for which we did not propose any
changes, as well as our responses.
Comment: In general, commenters expressed support for the CJR
model. One commenter suggested that CMS extend the model on a voluntary
basis after the conclusion of the model's 5 performance years, to allow
for successful participants to continue under CJR. The commenter also
suggested that in such a scenario, CMS allow for convening
organizations to participate (as is the case currently under the BPCI
initiative) and modify the model design to include features such as
financial risk for the post-acute care period only. The commenter noted
that such flexibility would encourage participation in alternative
payment models.
Another commenter expressed support for the CJR model but noted the
significant time and effort required for hospitals to implement the
model. Commenters also requested several policy changes out of scope
for this rulemaking, including: Additional relaxation of regulatory
barriers to integration between hospitals and other stakeholders,
removal of fractures in
[[Page 191]]
their entirety from this episode payment model, additional waivers of
Medicare program rules, additional quality measures, policies that
would encourage use of specific medical devices associated with lower
revision rates, and modifications to the pricing methodology that would
include comprehensive risk adjustment. Finally, one commenter requested
that data be provided on a more frequent basis.
Response: We thank the commenters for their support of the CJR
model. With regard to the CJR model policies for which we did not
propose any changes, we will continue to consider the issues commenters
brought forward and if warranted, would address any changes through
future rulemaking as necessary. In addition, we note that while
currently we provide CJR hospitals with episode data on a quarterly
basis, we may begin to consider providing such data on a monthly basis
when practicable.
Comment: A few commenters supported CMS' pursuit of opportunities
to spread value-based payment to more providers through additional
episode payment models beyond lower extremity joint replacement.
Response: We acknowledge and appreciate the commenters' remarks.
Comment: A few commenters addressed issues on the following
subject-matter areas: Alternative administration of medications, non-
medically directed anesthesia delivery, remote patient monitoring, data
collection for global surgical services, and the long term care
hospital certification program.
Response: These comments pertain to issues for which we did not
include any proposals in the proposed rule. Therefore, we believe these
comments are outside the scope of the proposed rule, and we are not
addressing them in this final rule. After carefully considering all of
the comments we received on the proposed model, including those
discussed previously and within the following pages, for the reasons
described elsewhere in this rule, we have concluded that we can
successfully test the Episode Payment Models with several modifications
and timing changes. The final model design we are implementing includes
additional lead time for participants prior to the onset of downside
risk to ensure that the models have time to incorporate risk adjustment
into pricing, a commitment to conduct public listening sessions on risk
adjustment during the 2017 calendar year and rulemaking during the 2018
calendar year on risk adjustment methods, an exemption for the Medicare
Shared Savings Program Track 3 ACOs from participation in the EPMs and
adjustments to the AMI transfer policy and the CABG quality measures.
All of these changes are discussed in detail in this final rule.
B. Summary of the Major Provisions
1. Model Overview--EPM Episodes of Care
The EPMs, as described further in section III.B.2. of this final
rule, are an AMI, CABG, or SHFFT model episode that will begin with an
inpatient admission to an anchor hospital assigned to one of the
following MS-DRGs upon beneficiary discharge. Acute care hospital
services furnished to beneficiaries in AMI, CABG, and SHFFT episodes
currently are paid under the Inpatient Prospective Payment System
(IPPS) through several Medicare Severity-Diagnosis Related Groups (MS-
DRGs): For AMI episodes, AMI MS-DRGs (280-282) and those Percutaneous
Coronary Intervention (PCI) MS-DRGs (246-251) representing IPPS
admissions for AMI that are treated with PCIs; CABG MS-DRGs (231-236);
and SHFFT MS-DRGs (480-482). Episodes will end 90 days after the date
of discharge from the anchor hospital, as defined under Sec. 512.2.
Defining EPMs' episodes of care in such a manner offers operational
simplicity for both providers and CMS. The EPMs' episodes will include
the inpatient stays and all related care covered under Medicare Parts A
and B within the 90 days after discharge, including hospital care,
post-acute care, and physician services.
2. Model Scope
Consistent with the CJR model, we proposed that acute care
hospitals would be the episode initiators and bear financial risk under
the proposed AMI, CABG and SHFFT models. In comparison to other health
care facilities, hospitals are more likely to have resources that would
allow them to appropriately coordinate and manage care throughout an
episode, and hospital staff members already are involved in hospital-
discharge planning and post-acute care recommendations for recovery,
key dimensions of high-quality and efficient care. We proposed to
require all hospitals to participate that are paid under the IPPS, have
a CMS Certification Number (CCN), and have an address located in
selected geographic areas to participate in the EPMs, with limited
exceptions. An eligible beneficiary who receives care at such a
hospital will automatically be included in the applicable EPM. We
proposed to select geographic areas through a random sampling
methodology.
For the CR incentive payment model, we proposed to provide a CR
incentive payment specifically to selected hospitals with financial
responsibility for AMI or CABG model episodes (hereinafter EPM-CR
participants) because they are already engaged in managing the AMI or
CABG model beneficiary's overall care for a period of time following
hospital discharge. Similarly, we believe there are opportunities to
test the same financial incentives for hospitals where the
beneficiary's overall care is paid under the Medicare FFS program.
Thus, we also proposed to provide a CR incentive payment specifically
to selected hospitals that are not AMI or CABG model participants
(hereinafter FFS-CR participants).
Our geographic-area selection process is detailed further in
section III.B.4. of this final rule.
3. Payment
We will test the AMI, CABG, and SHFFT EPMs for 5 performance years.
The first performance year would begin July 1, 2017. During these
performance years we will continue paying hospitals and other providers
and suppliers according to the appropriate Medicare FFS payment
systems. However, after the completion of a performance year, the
Medicare claims payments for services furnished to an eligible
beneficiary during an episode, based on claims data, will be combined
to calculate an actual episode payment. The actual episode payment will
then be reconciled against an established EPM quality adjusted target
price. The amount of this calculation, if positive, will be paid to the
EPM participant as a ``reconciliation payment'' provided they had
achieved a quality category of ``acceptable'' or higher. If the amount
of this calculation is negative, we will require a ``Medicare
repayment'' from the participant hospital beginning with episodes
ending in performance year 3 of the EPMs. We had proposed to phase in
the requirement that participants whose actual episode payments exceed
the quality adjusted target price pay the difference back to Medicare
beginning in the second quarter of performance year 2, and under this
proposal, CMS would not require a Medicare repayment from hospitals for
actual episode payments that exceed their target price in performance
year 1 and the first quarter of performance year 2. Our final rule
implements the requirement for Medicare repayments during performance
year 3 and includes
[[Page 192]]
an applicable discount factor that would be used for calculating
repayment amounts for performance years 3 and 4. Also, participants may
elect to assume downside risk for performance year 2, which would also
include an applicable discount factor for calculating repayment
amounts.
In contrast to the CJR model, due to the clinical characteristics
and common patterns of care in AMI episodes, we proposed payment
adjustments in the cases of certain transfers and readmissions of
beneficiaries to inpatient hospitals for these episodes. These payment
adjustments are discussed in detail in sections III.D.4.b.(1). through
III.D.4.b.(2).(a). of the proposed and this final rule. We did not
finalize one of these proposals--a payment adjustment for AMI episodes
involving an inpatient-to-inpatient transfer or what we referred to as
a chained anchor hospitalization. We also proposed payment adjustments
for CABG model episodes, which we are finalizing in this rule. We
proposed and are making final with modification limits on how much a
hospital can gain or lose based on its actual episode payments relative
to quality adjusted target prices, including policies to further limit
the risk of high payment cases for special categories of participants
as described in sections III.D.7.a. through III.D.7.d. of this final
rule. In response to comments, we are finalizing a policy to extend
separate financial loss protections to participants with a low volume
of episodes under a model, which we refer to as EPM volume protection
hospitals.
In addition to the EPMs, we proposed to test a CR incentive payment
model (81 FR 50800) to encourage the utilization of CR/ICR services for
beneficiaries hospitalized for treatment of AMI or CABG. To determine
the CR incentive payment, we proposed to count the number of CR/ICR
services for the relevant time periods under the Outpatient Prospective
Payment System (OPPS) and PFS on the basis of the presence of paid
claims of the HCPCS codes that report CR/ICR services and the units of
service billed. The initial level of the per service CR incentive
amount would be $25 per CR/ICR service for each of the first 11 CR/ICR
services paid for by Medicare during an AMI or CABG model episode or
AMI or CABG care period. After 11 CR/ICR services are paid for by
Medicare for a beneficiary, the level of the per service CR incentive
amount will increase to $175 per CR/ICR service for each additional CR/
ICR service paid for by Medicare during the AMI or CABG model episode
or AMI care period or CABG care period. A more detailed discussion of
the CR incentive payment is located in section VI.E.1 of this final
rule. The CR performance years would be the same as the performance
years for the EPMs in section III.D.2.a. of this final rule. Further
details about the payment structure and design of the CR incentive
payment model can be found in section VI. of this final rule.
4. Similar, Previous, and Concurrent Models
The EPMs are informed by other models and demonstrations currently
and previously conducted by CMS, and will explore additional ways to
use episode payment to enhance coordination of care and improve the
quality of care.
We recently announced practices that will participate in the
Oncology Care Model (OCM), an episode payment model for physician
practices administering chemotherapy. Under OCM, practices will enter
into payment arrangements that include both financial and performance
accountability for episodes of care surrounding chemotherapy
administration to cancer patients. We will coordinate with other payers
to align with OCM in order to facilitate enhanced services and care at
participating practices.\8\
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\8\ More information on the OCM can be found on the Innovation
Center's Web site at http://innovation.cms.gov/initiatives/Oncology-Care/.
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The Innovation Center previously tested innovative episode payment
approaches in the Medicare Acute Care Episode (ACE) demonstration,\9\
and, as described in this final rule, currently is testing additional
approaches under the BPCI initiative and the CJR model. The ACE
demonstration tested an alternative payment approach for cardiac and
orthopedic inpatient surgical services and procedures. All Medicare
Part A and Part B services pertaining to the inpatient stay were
included in the ACE demonstration episodes of care. Evaluations of the
ACE demonstration found that while there was not strong quantitative
evidence indicating improvements in quality, there was qualitative
evidence that hospitals worked to improve processes and outcomes as a
result of their participation in the demonstration.
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\9\ Information on the ACE Demonstration can be found on the
Innovation Center's Web site at http://innovation.cms.gov/initiatives/ACE/.
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Currently, we are testing the BPCI initiative, which is composed of
related payment models that link payments for multiple services that a
Medicare beneficiary receives during an episode of care into a bundled
payment. Under the initiative, entities enter into payment arrangements
with CMS that include financial and performance accountability for
episodes of care. Episodes of care under the BPCI initiative begin with
either: (1) An inpatient hospital stay or (2) post-acute care services
following a qualifying inpatient hospital stay. The BPCI initiative is
evaluating the effects of episode-based payment approaches on patient
experience of care, outcomes, and cost of care for Medicare FFS
beneficiaries. Participating organizations chose from 48 clinical
episodes, including hip and femur procedures except major joint, acute
myocardial infarction, percutaneous coronary intervention, and coronary
artery bypass graft surgery. BPCI Model 2 is an episode payment model
in which a qualifying acute care hospitalization initiates a 30-, 60-,
or 90-day episode of care. The episode includes the inpatient stay in
an acute care hospital and all related services covered under Medicare
Parts A and B during the episode, including post-acute care
services.\10\ Our experience testing BPCI Model 2 informed the design
of the three proposed EPMs. Although some interim evaluation results
from the BPCI models are available, final evaluation results for the
models within the BPCI initiative are not yet available. However, we
believe that CMS' experiences with BPCI support the design of the
proposed EPMs. Stakeholders both directly and indirectly involved in
testing BPCI models have conveyed that they perceive the initiative to
be an effective mechanism for advancing better, more accountable care
and aligning providers along the care continuum. This message has been
reinforced through CMS site visits to participating entities, the
Bundled Payments summit in Washington, in-person meetings with Awardees
at CMS, and Awardee-led Affinity Group discussions. The BPCI initiative
incorporates 48 clinical episodes, including cardiac and orthopedic
episodes similar to the AMI, CABG, and SHFFT models. These clinical
episodes are being tested by over 1,200 Medicare providers, including
acute care hospitals, physician group practices, skilled nursing
facilities, and home health agencies. Cardiac and orthopedic clinical
episodes are among the most popular episodes in BPCI, indicating that
BPCI awardees participating in BPCI believe they can reduce cost and
[[Page 193]]
improve quality for beneficiaries in these episodes of care.
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\10\ More information on BPCI Model 2 can be found on the
Innovation Center's Web site at http://innovation.cms.gov/initiatives/BPCI-Model-2/.
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Our design and implementation of the CJR model, which is an episode
payment model for LEJR episodes, also informed the design of the AMI,
CABG, and SHFFT EPMs. After releasing a proposed rule in July 2015 and
receiving nearly 400 comments from the public, in November 2015 we
released final regulations implementing the CJR model. Approximately
800 acute care hospitals (approximately 23 percent of all IPPS
hospitals) now participate in the CJR model. The first CJR performance
year began on April 1, 2016. The CJR model will continue for 5
performance years, ending on December 31, 2020. The AMI, CABG, and
SHFFT models build upon our experience designing and implementing the
CJR model, including feedback from providers and other public
stakeholders during the CJR model's rulemaking and implementation
processes.
Further information on why specific elements of the models and
initiatives were incorporated into the EPMs' designs is discussed later
in this final rule.
5. Overlap With Ongoing CMS Efforts
We proposed to exclude from participation in the AMI, CABG, and
SHFFT models certain acute care hospitals participating in BPCI Models
2 and 4 for the hip and femur procedures except major joint or for all
three of the BPCI cardiac episodes (AMI, PCI, and CABG). We proposed to
exclude from EPMs beneficiaries prospectively aligned to Innovation
Center ACO models which had downside financial risk such as the Next
Generation ACO and the Comprehensive ESRD Care models. We also sought
comment regarding whether this exclusion should be extended to include
beneficiaries assigned to Track 3 Shared Savings Program ACOs as these
ACOs also have prospective assignment and downside financial risk. As
discussed in the proposed rule, other CMS programs, such as the Shared
Savings Program (Tracks 1 and 2) and other accountable care
organization (ACO) or total cost of care initiatives will remain
eligible for EPM episode initiation. We proposed to account for
overlap, that is, where EPM beneficiaries also are included in other
models and programs to ensure the financial policies of the models are
maintained and results and spending reductions are attributed to one
model or program. Specifically, as with CJR, we have proposed to give
precedence to existing BPCI models when a beneficiary is admitted to an
acute care hospital for what would otherwise be a covered EPM episode
but that acute care hospital or the treating physician is participating
in BPCI and the admission would meet the criteria to be covered under
BPCI. In addition, as with CJR, an EPM episode will be cancelled if a
beneficiary whose hospitalization initiates an EPM episode receives
treatment during the post discharge period that would also result in
the episode being covered under BPCI. Based on the comments received,
we are finalizing these proposals with the modification that we will
exclude from EPMs not only those beneficiaries prospectively assigned
to the Next Generation ACO and the Comprehensive ESRD Care models which
also share in downside risk with CMS, but also those beneficiaries
prospectively assigned to Track 3 Shared Savings Program ACOs. More
detail on our policies for accounting for provider- and beneficiary-
level overlap is discussed in section III.D.6. of this final rule.
The amendments made by the Medicare Access and CHIP Reauthorization
Act of 2015 (MACRA) (Pub. L. 114-10, April 16, 2015) created two paths
for eligible clinicians to link quality to payments: The Merit-Based
Incentive Payment System (MIPS) and Advanced Alternative Payment Models
(APMs). These two paths create a flexible payment system called the
Quality Payment Program as finalized by CMS in the Quality Payment
Program final rule with comment period (81 FR 77008 through 77831). The
MIPS streamlines and improves on three current programs--the Physician
Quality Reporting System (PQRS), the Physician Value-based Payment
Modifier (VM), and the Medicare Electronic Health Record (EHR)
Incentive Program--and continues the focus on quality and value in one
cohesive program. Through sufficient participation in Advanced APMs,
eligible clinicians can become Qualifying APM Participants (QPs) for a
payment year beginning with CY 2019 and potentially receive an APM
Incentive Payment (or, in later years, a more favorable payment update
under the PFS) for the year.
So that the EPMs may be able to meet the criteria to be Advanced
APMs based on the requirements in the Quality Payment Program final
rule with comment period, we proposed to require EPM participants to
use Certified Electronic Health Record Technology (CEHRT) (as defined
in section 1848(o)(4) of the Act) in Track 1 of each EPM. We proposed
that EPM participants in these tracks must use certified health
information technology (IT) functions, in accordance with the
definition of CEHRT under our regulation at 42 CFR 414.1305, to
document and communicate clinical care with patients and other health
care professionals as described in the Quality Payment Program final
rule with comment period. We also made similar proposals with respect
to CJR.
We proposed to implement two different tracks within the EPMs
whereby EPM participants that meet requirements for use of CEHRT and
financial risk would be in Track 1 (an Advanced APM track) and EPM
participants that do not meet these requirements would be in Track 2 (a
non-Advanced APM track). The different tracks would not change how EPM
participants operate within the EPM itself, beyond the requirements
associated with selecting to meet CEHRT use requirements. The only
distinction between the two tracks is that only Track 1 EPMs could be
considered an Advanced APM for purposes of the Quality Payment Program
based on the criteria in the Quality Payment Program final rule with
comment period. We made similar proposals with respect to CJR. We
considered modifying requirements proposed in this rule as necessary to
reconcile them with policies adopted in the Quality Payment Program
final rule. A more detailed discussion of how EPMs and CJR could
qualify as Advanced APMs, and how eligible clinicians participating in
the EPMs and CJR will be identified and affected, can be found in
sections III.A.2 and V.O. of this final rule.
Comment: One commenter suggested that the most relevant definition
of CEHRT to the EPM is found at Sec. 495.4.
Response: The definition at 42 FR 495.4 relates to Medicaid
eligible professionals, eligible hospitals, and CAHs, as defined for
the EHR Incentive Programs. The definition at 45 FR 414.1305 relates to
Medicare eligible clinicians and groups participating as defined for
the CMS Quality Payment Program. These two definitions are
substantively the same; however, we refer readers to the definition at
42 FR 495.4 as this most closely relates to the eligibility status of
EPM participants. We have updated and finalized this technical
correction.
6. Quality Measures and Reporting Requirements
Similar to the quality measures selected for the CJR model, we
proposed to use established measures used in other CMS quality-
reporting programs for the proposed EPMs' episodes. We proposed to use
these measures to test
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EPMs' success in achieving its goals under section 1115A of the Act and
to monitor for beneficiary safety. For the SHFFT model, we proposed
applying the same quality measures selected for the CJR model.
The quality measures for SHFFT episodes are as follows:
THA/TKA Complications: Hospital-Level Risk-Standardized
Complication Rate (RSCR) Following Elective Primary Total Hip
Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) (National
Quality Forum [NQF] #1550).
Hospital Consumer Assessment of Healthcare Providers and
Systems (HCAPHS) Survey (NQF #0166).
Successful Voluntary Reporting of Patient-Reported
Outcomes.
The measures for the AMI model are as follows:
MORT-30-AMI: Hospital 30-Day, All-Cause, Risk-Standardized
Mortality Rate (RSMR) Following Acute Myocardial Infarction (AMI)
Hospitalization (NQF #0230).
AMI Excess Days: Excess Days in Acute Care after
Hospitalization for Acute Myocardial Infarction (acute care days
include emergency department, observation, and inpatient readmission
days).
HCAPHS Survey (NQF #0166), linear mean roll-up (HLMR)
scores like CJR.
The measures for the CABG model are as follows:
MORT-30-CABG: Hospital 30-Day, All-Cause, Risk-
Standardized Mortality Rate (RSMR) Following Coronary Artery Bypass
Graft Surgery (NQF #2558).
HCAPHS Survey (NQF #0166), HLMR scores like CJR.
We proposed and requested public feedback on options for including
successful implementation testing of the Hybrid AMI measure as a
quality measure for the AMI episode. The Hybrid AMI measure will assess
a hospital's 30-day risk-standardized acute myocardial infarction
mortality rate and will incorporate a combination of claims data and
EHR data submitted by hospitals. Public comment and our responses to
those comments follow under the applicable sections in section III. of
this final rule.
We are finalizing as proposed the following quality measures for
SHFFT episodes:
THA/TKA Complications: Hospital-Level Risk-Standardized
Complication Rate (RSCR) Following Elective Primary Total Hip
Arthroplasty (THA) and/or Total Knee Arthroplasty (TKA) (National
Quality Forum [NQF] #1550).
Hospital Consumer Assessment of Healthcare Providers and
Systems (HCAPHS) Survey (NQF #0166).
Successful Voluntary Reporting of Patient-Reported
Outcomes.
We are finalizing as proposed the following measures for the AMI
model:
MORT-30-AMI: Hospital 30-Day, All-Cause, Risk-Standardized
Mortality Rate (RSMR) Following Acute Myocardial Infarction (AMI)
Hospitalization (NQF #0230).
AMI Excess Days: Excess Days in Acute Care after
Hospitalization for Acute Myocardial Infarction (acute care days
include emergency department, observation, and inpatient readmission
days).
HCAPHS Survey (NQF #0166), linear mean roll-up (HLMR)
scores like CJR.
We are finalizing as proposed the following measures for the CABG
model:
MORT-30-CABG: Hospital 30-Day, All-Cause, Risk-
Standardized Mortality Rate (RSMR) Following Coronary Artery Bypass
Graft Surgery (NQF #2558).
HCAPHS Survey (NQF #0166), HLMR scores like CJR.
In addition, after consideration of comments received, we are
finalizing an additional measure for the CABG model. Successful
voluntary reporting of the Society of Thoracic Surgeons (STS) CABG
composite score (NQF #0696) is a comprehensive NQF-endorsed composite
measure and will be weighted at 10 percent of the composite quality
score for those hospitals that report this voluntary measure.
Additionally, similar to the CJR model, we proposed to adopt a pay-
for-performance methodology for EPMs that relies upon a composite
quality score to assign respective EPM participants to four quality
categories. These quality categories will determine an EPM
participant's eligibility for a reconciliation payment should such EPM
participant achieve spending below the quality-adjusted target price,
as well as the effective discount percentage at reconciliation. Points
for quality performance and improvement (as applicable) will be awarded
for each episode measure and then summed to develop a composite quality
score that will determine the EPM participant's quality category for
the episode. Quality performance will make up the majority of available
points in the composite quality score, with improvement points
available as ``bonus'' points for the measure. This approach resembles
the CJR model methodology.
7. Beneficiary Protections
As with the CJR model, Medicare beneficiaries in the EPM models
will retain the right to obtain health services from any individual or
organization qualified to participate in the Medicare program. Eligible
beneficiaries who receive services from EPM participants would not have
the option to opt out of inclusion in the applicable model. We proposed
to require EPM participants to supply beneficiaries with written
information regarding the design and implications of these models as
well as the beneficiaries' rights under Medicare, including their right
to use their providers of choice. We will make a robust effort to reach
out to beneficiaries and their advocates to help them understand the
models. We also proposed to use our existing authority, if necessary,
to audit participant hospitals if claims analysis indicates an
inappropriate change in furnished services. Beneficiary protections are
discussed in greater depth in section III.G. of this final rule.
8. Financial Arrangements
We proposed a regulatory structure for financial relationships
under the EPM to advance the goals of improving the quality and
efficiency of model episodes, which also included program integrity
safeguards to protect against abuse under the financial relationships
permitted for the EPM. Our EPM proposals reflected changes from the
current CJR model regulations that generally fell into the following
four categories: (1) Removing duplication of requirements in similar
provisions; (2) streamlining and reorganizing the provisions for
clarity and consistency; (3) providing additional flexibility in
response to feedback from CJR participant hospitals and other
stakeholders; and (4) expanding the scope of financial arrangements
under the EPM. In addition to the collaborators permitted under the CJR
model, we proposed to add hospitals and critical access hospitals
(CAHs) to the list of providers and suppliers eligible for gainsharing
as EPM collaborators due to the expected participation of multiple
hospitals in the episode care for some beneficiaries in AMI and CABG
episodes. We specifically proposed that ACOs be eligible for
gainsharing as EPM collaborators due to the interest of ACOs in
gainsharing during the CJR model rulemaking and the ongoing challenges
of addressing overlap between episode payment models and ACOs. We made
additional proposals that would allow ACOs to enter into financial
arrangements under the EPM with ACO participants and ACO providers/
suppliers and to allow physicians group practices (PGPs) that are ACO
participants in an ACO that is an EPM collaborator to enter into
financial
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arrangements under the EPM with PGP members.
As discussed in section III.I. of this final rule, after
consideration of the public comments received we are finalizing the
proposed structure for financial arrangements under the EPM, including
that EPM participants may enter into sharing arrangements with EPM
collaborators, EPM collaborators may enter into distribution
arrangements with collaboration agents, and collaboration agents may
enter into downstream distribution arrangements with downstream
collaboration agents, subject to the requirements specific to each type
of arrangement. Our final policies also include modifications to
specify individually based on their enrollment in Medicare the specific
providers and suppliers of outpatient therapy services that may be EPM
collaborators. We also make modifications to clarify that groups of
nonphysician practitioners and groups of therapists (physical therapy,
occupational therapy, and speech-language pathology) enrolled in
Medicare may be EPM collaborators and may enter into distribution
arrangements or downstream distribution arrangements under the EPM that
are similar to those we are finalizing for PGPs and their members.
9. Data Sharing
Based on our experience with various Medicare programs and models,
including the BPCI initiative, the CJR model, the Shared Savings
Program, and the Pioneer ACO model, we believe that providing certain
beneficiary claims data to model participants will be essential to
their success. We proposed to share data with participants upon request
throughout the performance period of the models to the extent permitted
by the Health Insurance Portability and Accountability Act of 1996
(HIPAA) Privacy Rule and other applicable law. We proposed to share
upon request both raw claims-level data and claims summary data with
participants. This approach would allow participants without prior
experience analyzing claims to use summary data for analysis of care
and spending patterns, while allowing those participants who prefer raw
claims-level data the opportunity to analyze claims. We proposed to
provide participants with up to 3 years of retrospective claims data
upon request that will be used to develop their quality-adjusted target
price. In accordance with the HIPAA Privacy Rule, we will limit the
content of this data to the minimum data necessary for the participant
to conduct quality assessment and improvement activities and
effectively coordinate care.
10. Program Waivers
Section 1115A of the Act authorizes the Secretary to waive Medicare
program requirements as necessary to implement provisions for testing
models. Under the CJR model, CMS waived certain program rules regarding
the direct supervision requirement for certain post-discharge home
visits, telehealth services, and the skilled nursing facility (SNF) 3-
day rule. CMS finalized these waivers to offer providers and suppliers
more flexibility so that they may increase coordination of care and
management of beneficiaries in model episodes. Adopting the CJR waivers
for the proposed EPMs required further examination to determine if such
adoption would increase financial vulnerability to the Medicare program
or would create inappropriate incentives to reduce the quality of
beneficiary care. As discussed in section III.J. of this final rule, we
will do the following:
Adopt waivers of the telehealth originating site and
geographic site requirement and to allow in-home telehealth visits for
all three proposed EPMs, as well as the general waiver to allow post-
discharge nursing visits in the home;
Provide model-specific limits to the number of post-
discharge nursing visits and make model-specific decisions about
offering the SNF 3-day stay waiver; and
Adopt a waiver for furnishing cardiac and intensive
cardiac rehabilitation services to allow a Nurse Practitioner, Clinical
Nurse Specialist, or Physician Assistant, in addition to a physician,
to perform specific physician functions.
C. Summary of Economic Effects
As shown in our impact analysis, we expect the EPMs to result in
savings to Medicare of $159 million over the 5 performance years of the
models. We note that a composite quality score will be calculated for
each hospital in order to determine eligibility for a reconciliation
payment and whether the hospital qualifies for quality incentive
payments that will reduce the effective discount percentage experience
by the hospital at reconciliation for a given performance year. More
specifically, in performance year 1 of the models, we estimate a
Medicare cost of approximately $10 million, as hospitals will not be
subject to downside risk in the first performance year of the models.
In performance year 2 of the models, we estimate a Medicare cost of
approximately $25 million, as some hospitals will voluntarily assume
downside risk in the second performance year of the models and some
hospitals will receive payments made by CMS. As we introduce downside
risk beginning in performance year 3 of the models, we estimate
Medicare savings of approximately $34 million. In performance years 4
and 5 of the models, we will move from target episode pricing that is
based on a hospital's experience to target pricing based on regional
experience, and we estimate Medicare savings of $49 million and $112
million, respectively.
As a result, we estimate the net savings to Medicare to be $159
million over the 5 performance years of the models. We anticipate there
will be a broader focus on care coordination and quality improvement
for EPMs among hospitals and other providers and suppliers within the
Medicare program that will lead to both increased efficiency in the
provision of care and improved quality of the care provided to
beneficiaries.
Additionally, the CR incentive model estimates that the impact on
the Medicare program may range from up to $29 million of additional
spending to $32 million of savings between 2017 and 2024, depending on
the change in utilization of CR/ICR services based on the proposed
incentive structure.
Finally, the change in the estimated net financial impact to the
Medicare program from the CJR model modifications in this final rule is
$22 million in spending, and the updated assumptions regarding the
number of hospitals that will report quality data result in an increase
of $4 million in spending. The total estimated net financial impact to
the Medicare program from both the modifications in the final rule and
revised assumptions are $26 million in spending. We note that under
section 1115A(b)(3)(B) of the Act, the Secretary is required to
terminate or modify a model unless certain findings can be made with
respect to savings and quality after the model has begun. If during the
course of testing a model it is determined that termination or
modification is necessary, such actions will be undertaken through
rulemaking.
II. Background
This final rule finalizes the implementation of three new EPMs and
a CR incentive payment model under the authority of section 1115A of
the Act. Under the AMI, CABG, and SHFFT EPMs, acute care hospitals in
certain selected geographic areas will be financially accountable for
quality
[[Page 196]]
performance and spending for applicable episodes of care. We proposed
to retrospectively apply through a reconciliation process the episode
payment methodology; hospitals and other providers and suppliers would
continue to submit claims and receive payment via the usual Medicare
FFS payment systems throughout the proposed EPMs' performance years.
Critical Access Hospitals (CAHs) acting as EPM collaborators would
continue to receive payment via the usual cost-based reimbursement
system. Hospitals participating in the proposed EPMs would receive
target prices, which reflect expected spending for care during an
episode as well as a discount to reflect savings to Medicare, on a
prospective basis, prior to the beginning of a performance year. All
related care covered under Medicare Parts A and B and furnished within
90 days after the date of hospital discharge from the anchor
hospitalization which initiated the applicable EPM episode would be
included in the episode of care. We proposed the CR incentive payment
model to test the effects on quality of care and Medicare expenditures
of providing explicit financial incentives to a subset of EPM
participants and selected hospitals that are not AMI or CABG model
participants for beneficiaries hospitalized for treatment of AMI or
CABG to encourage care coordination and greater utilization of
medically necessary CR/ICR services for 90 days post-hospital discharge
where the beneficiary's overall care is paid under either an EPM or the
Medicare FFS program. We believe the models will further our goals of
improving the efficiency and quality of care for Medicare beneficiaries
for these medical conditions and procedures.
III. Episode Payment Models
A. Selection of Episodes, Advanced Alternative Payment Model
Considerations, and Future Directions
1. Selection of Episodes for Episode Payment Models in This Rulemaking
a. Overview
We have been engaged since 2013 in testing various approaches to
episode payment for Medicare FFS beneficiaries for 48 clinical episodes
in the BPCI initiative. As of October 1, 2016, the BPCI initiative has
1,403 participants in the risk-bearing phase, comprised of 297 Awardees
and 1,107 Episode Initiators. The breakdown of BPCI participants by
provider type is as follows: Acute care hospitals (354); skilled
nursing facilities (642); physician group practices (257); home health
agencies (81); and inpatient rehabilitation facilities (9).\11\ In BPCI
Models 2 and 3, there is participation across all 48 clinical episodes,
and in Model 4 there is participation in 19 clinical episodes.
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\11\ https://innovation.cms.gov/initiatives/bundled-payments/.
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The 10 clinical episodes with the most participation are: Major
joint replacement of the lower extremity; simple pneumonia and
respiratory infections; congestive heart failure; chronic obstructive
pulmonary disease; bronchitis; asthma; hip and femur procedures except
major joint; sepsis; urinary tract infection; acute myocardial
infarction (medical management only); medical non-infectious
orthopedic; and other respiratory.\12\
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\12\ https://innovation.cms.gov/Files/x/bpcianalyticfile.xlsx.
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In November 2015, CMS released the Final Rule for the Comprehensive
Care for Joint Replacement (CJR) model (80 FR 73274 through 73554), the
first test of episode-based payment model for Medicare FFS
beneficiaries in which providers are required to participate. The CJR
model, which began on April 1, 2016, focuses on the episode-of-care for
lower-extremity joint replacement (LEJR) procedures. As discussed in
the CJR Final Rule (80 FR 73277), LEJR episodes were chosen for the CJR
model because they represent one of the most common high-expenditure,
high-utilization procedures furnished to Medicare beneficiaries and
have significant variation in episode spending. We believe this high
volume, coupled with substantial variation in utilization and spending
across individual providers and geographic regions, created a
significant opportunity to test whether an episode payment model
focused on a defined set of procedures could improve the quality and
coordination of care, as well as result in savings to Medicare.
Notably, both the BPCI initiative and the CJR model are focused on care
that is related to an inpatient hospitalization, with CJR model and
BPCI Model 2 episodes beginning with an inpatient hospitalization
(anchor hospitalization) and extending up to 90 days post-hospital
discharge.
In the proposed rule (81 FR 50805), we proposed three new EPMs
that, like the CJR model, would require provider participation in
selected geographic areas. Episodes in the new EPMs would begin with
admissions for hospitalizations in IPPS hospitals, and would extend 90
days post-hospital discharge. The episodes included in these three
proposed EPMs would be AMI, CABG, and SHFFT excluding lower extremity
joint replacement. The proposed AMI model included beneficiaries
discharged under AMI MS-DRGs (280-282), representing IPPS admissions
for AMI that are treated with medical management. The proposed AMI
model also included beneficiaries discharged under PCI MS-DRGs (246-
251) with AMI International Classification of Disease, Tenth Edition,
Clinical Modification (ICD-10-CM) diagnosis codes for initial AMI
diagnoses in the principal or secondary diagnosis code positions,
representing IPPS admissions for AMI that are treated with PCIs. The
proposed CABG model included beneficiaries discharged under CABG MS-
DRGs (231-236), representing IPPS admissions for this coronary
revascularization procedure irrespective of AMI diagnosis. The proposed
SHFFT model included beneficiaries discharged under hip and femur
procedures except major joint replacement MS-DRGs (480-482),
representing IPPS admissions for hip-fixation procedures in the setting
of hip fractures.
Similar to the selection of LEJR episodes for the CJR model (80 FR
73277), we selected the AMI, CABG, and SHFFT episodes because they
represent high-expenditure, high-volume episodes-of-care experienced by
Medicare beneficiaries. Based on analysis of historical episodes
beginning in CY 2012-2014, the average annual number of episodes that
began with IPPS hospitalizations and extended 90 days post-hospital
discharge, and therefore would have been included in the proposed
models, is approximately 168,000 for AMI; 48,000 for CABG; and 109,000
for SHFFT.\13\ The total annual Medicare spending for these historical
episodes was approximately $4.1 billion, $2.3 billion, and $4.7
billion, respectively.\14\ Each of the episodes provides different
opportunities in an EPM to improve the coordination and quality of
care, as well as efficiency of care during the episode, based on
varying current patterns of utilization and Medicare spending.
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\13\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated
by all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule that began in CY 2012-2014.
\14\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated
by all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule that began in CY 2012-2014.
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However, in contrast to LEJR episodes in the CJR model, which are
predominantly elective and during which hospital readmissions are rare
[[Page 197]]
and substantial post-acute care provider utilization is common, the
proposed AMI, CABG, and SHFFT episodes have very different current
patterns of care. Beneficiaries in these episodes commonly have chronic
conditions that contribute to the initiation of the episodes and need
both planned and unplanned care throughout the EPM episode following
discharge from the initial hospitalization that begins the episode.
Both AMI and CABG episodes primarily include beneficiaries with
cardiovascular disease, a chronic condition which likely contributed to
the acute events or procedures that initiate the episodes. About half
the average AMI model historical episode spending was for the initial
hospitalization, with the majority of spending following discharge from
the initial hospitalization due to hospital readmissions, while there
was relatively less spending on SNF services, Part B professional
services, and hospital outpatient services. In CABG model historical
episodes, about three-quarters of episode spending was for the initial
hospitalization, with the remaining episode spending relatively evenly
divided between Part B professional services and hospital readmissions,
and a lesser percentage on SNF services. Similar to AMI episodes, post-
acute care provider use was relatively uncommon in CABG model
historical episodes, while hospital readmissions during CABG model
historical episodes were relatively common. SHFFT model historical
episodes also were accompanied by substantial spending for hospital
readmissions, and post-acute care provider use in these episodes also
was high.\15\ The number of affected beneficiaries and potential impact
of the models on quality and Medicare spending present an important
opportunity to further the Administration's goal of shifting health
care payments to support the quality of care over the quantity of
services by promoting better coordination among health care providers
and suppliers and greater efficiency in the care of beneficiaries in
these models, while reducing Medicare expenditures.\16\ Pay-for-
performance episode payment models, such as the three EPMs proposed in
the proposed rulemaking, financially incentivize improved quality of
care and reduced cost by aligning the financial incentives of all
providers and suppliers caring for model beneficiaries with these
goals. This alignment leads to a heightened focus on care coordination
and management throughout the episode that prioritizes the provision of
those items and services which improve beneficiary outcomes and
experience at the lowest cost.
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\15\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated
by all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule that end in CY 2014.
\16\ Sylvia Mathews Burwell, HHS Secretary, Progress Towards
Achieving Better Care, Smarter Spending, Healthier People, http://www.hhs.gov/blog/2015/01/26/progress-towards-better-care-smarter-spending-healthier-people.html (January 26, 2015).
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We selected all of the proposed EPM episodes based on their
clinical homogeneity, site-of-service, and MS-DRG assignment
considerations. We anticipated these proposed new EPMs, like the CJR
model, would benefit Medicare beneficiaries by improving the
coordination and transition of care among various care settings to
facilitate beneficiaries' return to their communities as their
recoveries progress, improving the coordination of items and services
paid through Medicare FFS, encouraging provider investment in
infrastructure and redesigned care processes for higher quality and
more efficient service delivery, and incentivizing higher value care
across the inpatient and post-acute care spectrum spanning the episode-
of-care (80 FR 73276). However, improving value in the EPMs through
these means requires a cohort of beneficiaries with similar clinical
features such that coordination and care redesign efforts can be
targeted. Therefore, we proposed EPM episodes built on common
pathologic and treatment processes; that is, beneficiaries included in
both the AMI and CABG models have cardiovascular pathologies that drive
their clinical courses during the episodes, and SHFFT model
beneficiaries all share similar diagnoses of hip fracture and treatment
with hip fixation that drive their clinical courses during their
respective episodes.
The following is a summary of the comments received on our overall
proposal of three new EPMs in which participation would be required and
our responses.
Comment: Many commenters commended CMS for its continued commitment
to testing episode-based payments demonstrated through the proposal to
implement three new EPMs. MedPAC identified conditions with high post-
acute care use as an appropriate setting to test bundled payments that
would offer ample opportunities to improve care and lower spending.
MedPAC also suggested that another consideration for bundled payments
is whether the condition has a relatively uniform clinical pathway that
simplifies the rules defining and pricing the bundle. In addition,
MedPAC emphasized that conditions that lend themselves to patient
selection should be avoided in bundled payment models, at least in the
near term, to limit the undesirable provider responses to financial
incentives that may occur. Other commenters expressed appreciation for
the opportunity to test innovative care models under the Innovation
Center authority. They stated that EPMs could hold significant promise
for furthering the Triple Aim goals of providing high quality care at
lower cost to produce better outcomes and advance population health.
However, some commenters expressed concern about the pace of
changes proposed by CMS through its models and the associated
expectation and burden that rapid changes in the delivery system and
related payment structure place on hospitals and providers. Some
commenters noted that CMS has been swift in releasing rules aimed at
improving the quality of care delivered, reducing the cost of care, and
coordinating patient care across multiple settings. The commenters
pointed out the large volume of significant requirements announced by
CMS over the last 2 years, including MACRA, the CJR model, and the
proposed Part B drug payment model, as well as alternative payment
models and programs, including the Shared Savings Program, Next
Generation ACOs, BPCI initiative, and OCM, coupled with state level
initiatives. The commenters believe the breadth and amount of new
activities make it difficult to understand how the various models and
program will interact with each other and impact individual delivery
systems. While directed toward laudable goals, the commenters
encouraged CMS to be vigilant in its review and analysis of these
models and programs and to consider the impact and burden on hospitals
as it continues to release models and programs impacting the hospital
community. The commenters believe it is in everyone's best interest
that these models are successful, yet the pace and complexity of
implementation likely will be a critical factor in the achievement of
these goals. Therefore, they encouraged CMS to slow the pace of EPM
implementation to establish ``proof of concept'' through the CJR model
and BPCI Model 2 results before implementing new EPMs where
participation is required. Without adequate time to understand the
appropriate role these payment innovations play in transforming care
delivery and build upon lessons learned and best practices, the
commenters
[[Page 198]]
concluded that both CMS and the provider community would miss an
important opportunity to create programs that will advance patient care
and successfully transform systems of care.
The commenters recommended that CMS establish a solid framework
upon which to build payment initiatives and transform care. Before
finalizing any more bundled payment initiatives, some commenters
believe that CMS should articulate its vision and set a clear path for
innovative payment models, establishing a consistent, predictable and
transparent framework, giving providers the necessary tools to succeed
in creating a higher-quality, more efficient health care system. The
commenters suggested that the framework should include tools such as
incorporating a predictable pricing trend factor so that participants
can make decisions about investing in care design in the context of
stable future prices; providing necessary risk adjustment
methodologies; releasing consistent quality measures and reporting
requirements and reliable target pricing; and holding fast to the
principle of attributing no more than one patient to one bundled
payment initiative at a time.
A few commenters expressed concerns about CMS' proposal to test
three new bundled payment models. The commenters contended that the
proposed EPMs would make treatment more difficult to access for high
need patients; discourage truly innovative approaches to managing
underlying health problems; encourage unnecessary surgeries; encourage
further consolidation in the health care industry; provide fewer
choices for consumers; and result in higher prices for private payers.
One commenter requested that CMS present a much more comprehensive
analytic work to understand the prevalence and needs of the
beneficiaries who have serious illness or disabilities prior to and
during the episode and who therefore require substantial attention to
the elements of comprehensive care and quality measurement that are
tailored for these beneficiaries prior to implementing the EPMs.
Several commenters recommended CMS not to limit alternative payment
models to episode payment approaches because for many types of
patients, the biggest opportunity for improving quality and achieving
savings is avoiding unnecessary episodes and events, and not simply
paying differently for episodes and events when they occur. Some
commenters strongly cautioned against EPMs that may subordinate future
provider-led models. Other commenters recommended CMS to develop and
implement payment reform models that incorporate population-based
models, rather than look exclusively at episode payment models which
can hamper growth of population-based models by limiting their
financial opportunity.
Response: We appreciate the support of many commenters for CMS'
continued development of new episode payment models and agree with
these commenters that episode payment models provide substantial
opportunity to improve the quality and efficiency of care for specific
clinical conditions. We also agree that bundled payment models are just
one strategy to incentivize the health care system moving toward the
provision of more accountable, coordinated, high-value care, while
provider-led and population-based models, as well as other types of
payment reform models, play complementary roles. The Innovation Center
is continuing to develop, implement, and evaluate a variety of
different types of models that test different approaches to achieving
better care, lower costs, and improved health. The three EPMs are part
of that portfolio of models. Issues of concern raised by some of the
commenters about the proposed EPMs, including the implementation
timeline, are discussed in the specific sections of this final rule
that address the relevant policies.
b. SHFFT Model
The SHFFT model was selected to complement the CJR model. We
proposed to test the SHFFT model in most of the same hospitals
participating in the CJR model as discussed in section III.B.4. of the
proposed rule (81 FR 50794), so that all surgical treatment options for
Medicare beneficiaries with hip fracture (hip arthroplasty and
fixation) would be included in episode payment models. Hip fracture is
a serious and sometimes catastrophic event for Medicare beneficiaries.
In 2010, 258,000 people aged 65 and older were admitted to the hospital
for hip fracture, with an estimated $20 billion in lifetime cost for
all hip fractures in the United States in a single year.\17\ In 2013,
fracture of the neck of the femur (the most common location for hip
fracture) was the eighth most common principal discharge diagnosis for
hospitalized Medicare FFS beneficiaries, constituting 2.7 percent of
discharges.\18\ Mortality associated with hip fracture is 5-10 percent
after 1 month and approximately 33 percent at 1 year.\19\ Hip
arthroplasty and hip fixation, or ``hip pinning,'' represent the two
broad surgical options for treating hip fractures.\20\ The CJR episodes
begin with admission to acute care hospitals for LEJR procedures
assigned to MS-DRG 469 (Major joint replacement or reattachment of
lower extremity with major complications or comorbidities) or MS-DRG
470 (Major joint replacement or reattachment of lower extremity without
major complications or comorbidities) upon beneficiary discharge and
paid under the IPPS, including total and partial hip replacement in the
setting of hip fracture (80 FR 73280). Therefore, the SHFFT model,
which would test an additional episode payment for hip fixation,
provides an opportunity to complete the transition to episode payment
for the surgical treatment and recovery of the significant clinical
condition of hip fracture.
---------------------------------------------------------------------------
\17\ Smith et al. Increase in Disability Prevalence Before Hip
Fracture. J Am Geriatr Soc. 2015 Oct;63(10):2029-35.
\18\ Krumholz HM, Nuti SV, Downing NS, Normand ST, Wang Y.
Mortality, Hospitalizations, and Expenditures for the Medicare
Population Aged 65 Years or Older, 1999-2013. JAMA. 2015;
314(4):355-365.
\19\ Parker et al. Hip Fracture. BMJ. 2006 Jul 1;333(7557):27-
30.
\20\ American Academy of Orthopaedic Surgeons, OrthoInfo: Hip
Fractures, http://orthoinfo.aaos.org (April 12, 2016).
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The following is a summary of the comments received and our
responses.
Comment: Some commenters expressed support for the SHFFT model,
which CMS proposed to implement in the same MSAs as the CJR model,
which was implemented beginning in April 2016, and in particular
expressed appreciation for the design consistency proposed for the
SHFFT model with the CJR model and the two proposed cardiac EPMs.
Analysis by MedPAC found that most SHFFT episodes include at least some
post-acute care services use and that the spending on post-acute care
services comprises a sizable share of total episode spending, about
one-third. MedPAC concluded that SHFFT was a good candidate for bundled
payment. MedPAC also reasoned that the SHFFT episode would give
hospitals already participating in the CJR model the experience of
managing care for hip and femur fracture cases that typically present
emergently, rather than as the planned, elective surgery that is most
common for lower extremity joint replacement. MedPAC, which recommended
proceeding only with the SHFFT model in the context of CMS' proposal
for three new EPMs, maintained that this
[[Page 199]]
would simplify the set of models that providers are adapting to and
simplify the administrative requirements for CMS because CMS would not
need to select new markets for testing the cardiac EPMs. Other
commenters found it positive that CMS noted that there are differences
between CJR and SHFFT beneficiaries, notably the latter being more
likely to have multiple chronic conditions and frailty.
However, many commenters opposed CMS' proposal for the SHFFT model,
encouraging CMS either to abandon the model altogether or to
substantially delay implementation pending additional CJR model
experience and evaluation results from BPCI Model 2 regarding SHFFT
episodes. These commenters recommended that CMS proceed at a more
deliberate pace and simplify the proposed rule for the three different
EPMs by eliminating the SHFFT model because CMS is already testing an
episode payment model that requires participation through the CJR
model. Therefore, they believe that CMS should test only a cardiac
bundled payment model in a different clinical area as a next step in
required bundled payment models. The commenters stated that the SHFFT
model would be overly burdensome to providers who just began
participating in the CJR model in April 2016 and had insufficient
financial safeguards for hospitals and quality safeguards for
beneficiaries, including no quality measures specific to SHFFT model
beneficiaries, to substantially improve beneficiaries' care experience
through successful surgery and recovery. Several commenters stated that
the proposed SHFFT model was not a true value-based payment model
because the clinical outcome quality measures that were proposed did
not capture hip fracture patients. Given CMS' proposal to implement the
SHFFT model in the same MSAs as the CJR model, the commenters stated
that due to limited implementation time of the CJR model, it would be
inappropriate to add the very sick and frail SHFFT cohort to the
relatively stable CJR model cohort without substantial investigation as
to how to proceed with adequate monitoring against harm. They also
recommended not proceeding without risk adjustment to account for
variable costs experienced by hospitals treating different populations
of SHFFT model beneficiaries. Several commenters claimed that because
SHFFT beneficiaries would receive emergency care, care coordination
would be less predictable and no planning would be possible prior to
hospital admission, so the burden on potential family caregivers would
be escalated in comparison to the CJR model if there was only a short
hospital and/or SNF stay. The commenters stated that in comparison with
beneficiaries undergoing elective LEJR, those with hip fracture require
more time and resources from providers to optimize planning and
rehabilitation and, therefore, limited efficiencies would be possible
for SHFFT model beneficiaries without significant risk to the quality
of care.
Response: We appreciate the perspective of some commenters that the
opportunities for care redesign to improve quality and reduce spending
are substantial for Medicare beneficiaries undergoing SHFFT procedures.
We agree with those commenters about the potential value of the SHFFT
model for beneficiaries, providers, and CMS to complement the CJR model
by testing bundled payment for beneficiaries requiring emergency lower
extremity joint surgery compared to testing episode payment for lower
extremity surgeries that are mainly elective. We also acknowledge the
concerns of the commenters around various proposed design elements of
the SHFFT model, specifically the lack of risk adjustment to protect
SHFFT model participants from undue financial risk for complex
beneficiaries and the lack of quality measures that are specific to
SHFFT beneficiaries in the pay-for-performance methodology to reward
SHFFT model participants that improve quality for these beneficiaries
and protect SHFFT beneficiaries from harm due to the model. We refer to
sections III.D.4.b.(2) and III.E.2.d. of this final rule for further
discussion of the comments on these issues and our responses.
We also appreciate the concerns of commenters regarding the
proposed implementation of the SHFFT model in the same MSAs as CJR
participant hospitals, and the additional responsibilities this model
would place on participants early in their CJR model implementation
experience. However, we continue to believe that there are efficiencies
in care redesign that can be achieved by testing the models
concurrently at the same hospitals. We note that those commenters
opposing CMS' proposal to implement the SHFFT model did not dispute the
care redesign opportunities identified by CMS for such a model. We
refer to section III.D.2.a. of this final rule for a discussion of the
comments on the proposed implementation timeline for the SHFFT model
and our responses.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal to implement the SHFFT model,
with modifications to specific policies as described throughout this
final rule. We refer to section III.D.2.a. of this final rule for the
implementation timeline that applies to the SHFFT model.
c. AMI and CABG Models
The AMI and CABG models, which we proposed to be tested at a single
set of hospitals as discussed in section III.B.5. of the proposed rule
(81 FR 50794), were selected to include all beneficiaries who have an
AMI treated medically or with revascularization with PCI, as well as
all beneficiaries who undergo CABG (whether performed during the care
of an AMI or performed electively for stable ischemic heart disease or
other indication). Both cardiac models represent clinical conditions
that result in a significant burden of morbidity and expenditures in
the Medicare population. CABG typically is the preferred
revascularization modality for patients with ST (the part of an
electrocardiogram between the QRS complex and the T wave) elevation AMI
where the coronary anatomy is not amenable to PCI or there is a
mechanical complication (for example, ventricular septal defect,
rupture of the free wall of the ventricle, or papillary-muscle rupture
with severe mitral regurgitation); for patients with CAD other than ST
elevation AMI where there is left main coronary artery disease or
multivessel disease with complex lesions; and for patients with
clinically significant CAD in at least one vessel and refractory
symptoms despite medical therapy and PCI.\21\ Despite the greater acute
morbidity related to major cardiothoracic surgery, CABG is associated
with lower longer-term rates of major adverse cardiac and
cerebrovascular events in comparison to PCI for certain groups of
patients.\22\ Moreover, a recent study found that in a group of
patients with ischemic cardiomyopathy, the rates of death from any
cause, death from cardiovascular causes, and death from any cause or
hospitalization for cardiovascular causes were significantly lower over
10 years among patients who underwent CABG in addition to receiving
medical
[[Page 200]]
therapy than among those who received medical therapy alone.\23\ While
about 30 percent of CABGs are performed during the care of AMIs, we
proposed to include these particular AMI beneficiaries generally in the
same episode as CABG for other indications, rather than in the AMI
episode, since we anticipate hospitals will seek to improve the quality
and efficiency of care for that surgical intervention, regardless of
indication.\24\
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\21\ Alexander JH, Smith PK. Coronary-Artery Bypass Grafting. N
Engl J Med. 2016 May 19;374(2):1954-1964.
\22\ Sepehripour et al. Developments in surgical
revascularization to achieve improved morbidity and mortality.
Expert Rev Cardiovasc Ther. 2016 Mar;14(3):367-79. doi: 10.1586/
14779072.2016.1123619. Epub 2015 Dec 17.
\23\ Velazquez et al. Coronary Artery Bypass Surgery in Patients
with Ischemic Cardiomyopathy. N Engl J Med. 2016 Apr 3.
\24\ Episodes for CABG beneficiaries initiated by all U.S. IPPS
hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in the proposed rule
that end in CY 2014.
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We proposed AMI as the episode for an EPM because we recognized it
as a significant clinical condition for which evidence-based clinical
guidelines are available for the most common AMI scenarios that begin
with a beneficiary's presentation for urgent care, most commonly to a
hospital emergency department. The hospital phase involves medical
management for all patients, as well as potential revascularization,
most commonly with PCI. Secondary prevention and plans for long-term
management begin early during the hospitalization, extend following
hospital discharge, and are addressed in clinical
guidelines.25 26 The AMI model is the first Innovation
Center episode payment model that includes substantially different
clinical care pathways (medical management and PCI) for a single
clinical condition in one episode in a model and, as such, represents
an important next step in testing episode payment models for clinical
conditions which involve a variety of different approaches to treatment
and management.
---------------------------------------------------------------------------
\25\ Amsterdam EA, Wenger NK, Brindis RG, Casey DE Jr, Ganiats
TG, Holmes DR Jr, Jaffe AS, Jneid H, Kelly RF, Kontos MC, Levine GN,
Liebson PR, Mukherjee D, Peterson ED, Sabatine MS, Smalling RW,
Zieman SJ. 2014 ACC/AHA guideline for the management of patients
with non-ST-elevation acute coronary syndromes: a report of the
American College of Cardiology/American Heart Association Task Force
on Practice Guidelines. Circulation. 2014;130:e344-e426.
\26\ O'Gara PT, Kushner FG, Ascheim DD, Casey DE Jr, Chung MK,
de Lemos JA, Ettinger SM, Fang JC, Fesmire FM, Franklin BA, Granger
CB, Krumholz HM, Linderbaum JA, Morrow DA, Newby LK, Ornato JP,Ou N,
Radford MJ, Tamis-Holland JE, Tommaso CL, Tracy CM, Woo YJ, Zhao DX.
2013 ACCF/AHA guideline for the management of ST-elevation
myocardial infarction: a report of the American College of
Cardiology Foundation/American Heart Association Task Force on
Practice Guidelines. Circulation. 2013;127:
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The American Heart Association estimates that every 42 seconds,
someone in the United States has a myocardial infarction.\27\ AMI
remains one of the most common hospital diagnoses among Medicare FFS
beneficiaries, and almost 20 percent of beneficiaries discharged for
AMI are readmitted within 30 days of hospital
discharge.28 29 In 2013, AMI was the sixth most common
principal discharge diagnosis for hospitalized Medicare FFS
beneficiaries, constituting 2.9 percent of discharges.\30\ Of the
approximately 395,000 Medicare FFS beneficiaries with short-term acute
care hospital discharges (excluding Maryland) for AMI in FY 2014, 60
percent were discharged under MS-DRGs proposed to be included in the
AMI model, specifically 33 percent under AMI MS-DRGs and 25 percent
under PCI MS-DRGs.\31\ An additional 3 percent of beneficiaries were in
MS-DRGs for death from AMI in the hospital. Although 5 percent of
beneficiaries with hospital discharges for AMI were discharged under
CABG MS-DRGs, we note that because both PCI and fibrinolysis can
restore blood flow in an acutely occluded coronary artery more quickly
than CABG, these interventions are currently preferred to CABG in most
cases of AMI. Furthermore, over recent years cardiovascular clinical
practice patterns have generally shifted away from surgical treatment
of coronary artery occlusion toward percutaneous, catheter-based
interventions.\32\ The remaining 34 percent of beneficiaries with AMI
diagnoses were distributed across a heterogeneous group of over 300
other MS-DRGs, such as septicemia, respiratory system diagnosis with
ventilator support, and major cardiovascular procedures. For this
latter group of beneficiaries, the AMI diagnosis appeared in a
secondary position on the hospital claim in more than 90 percent of the
cases, therefore most likely representing circumstances where the
beneficiary while hospitalized for another clinical condition
experienced an AMI during the hospital stay. By focusing the AMI model
on AMIs treated medically or with revascularization with PCI, we
proposed to test a condition-specific EPM that was discretely defined
and includes a significant majority of beneficiaries with AMI in the
AMI model. In CYs 2012-2014, the average Medicare spending for an AMI
episode that extends 90 days post-hospital discharge was approximately
$24,200.\33\ From the AMI model, we expect to better understand the
impact that such an EPM can have on efficiency and quality of care for
beneficiaries across the entire spectrum of AMI care, including
diagnosis, treatment, and recovery, as well as short-term secondary
prevention.
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\27\ Mozaffarian D, Benjamin EJ, Go AS, Arnett DK, Blaha MJ,
Cushman M, Das SR, de Ferranti S, Despr[eacute]s J-P, Fullerton HJ,
Howard VJ, Huffman MD, Isasi CR, Jim[eacute]nez MC, Judd SE, Kissela
BM, Lichtman JH, Lisabeth LD, Liu S, Mackey RH, Magid DJ, McGuire
DK, Mohler ER III, Moy CS, Muntner P, Mussolino ME, Nasir K, Neumar
RW, Nichol G, Palaniappan L, Pandey DK, Reeves MJ, Rodriguez CJ,
Rosamond W, Sorlie PD, Stein J, Towfighi A, Turan TN, Virani SS, Woo
D, Yeh RW, Turner MB; on behalf of the American Heart Association
Statistics Committee and Stroke Statistics Subcommittee. Heart
disease and stroke statistics--2016 update: a report from the
American Heart Association. Circulation. 2016 Jan 26; 133(4):447-54.
\28\ Krumholz HM, Nuti SV, Downing NS, Normand ST, Wang Y.
Mortality, Hospitalizations, and Expenditures for the Medicare
Population Aged 65 Years or Older, 1999-2013. JAMA. 2015;
314(4):355-365.
\29\ Dharmarajan K, Hsieh AF, Lin Z, et al. Diagnoses and Timing
of 30-Day Readmissions After Hospitalization for Heart Failure,
Acute Myocardial Infarction, or Pneumonia. JAMA. 2013; 309(4):355-
363.
\30\ Krumholz HM, Nuti SV, Downing NS, Normand ST, Wang Y.
Mortality, Hospitalizations, and Expenditures for the Medicare
Population Aged 65 Years or Older, 1999-2013. JAMA. 2015;
314(4):355-365.
\31\ Inpatient claims from all U.S. IPPS hospitals not in
Maryland were derived from the October 2013--September 2014
Inpatient Claims File located in the Chronic Conditions Warehouse.
\32\ Epstein et al. JAMA. 2011 May 4; 305(17):1769-1776.
\33\ Episodes for beneficiaries with AMI diagnosis initiated by
all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule that began in CYs 2012-2014.
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Beneficiaries in the AMI and CABG models will all have CAD. In 2010
in the U.S., the prevalence of CAD in the population 65 years and older
was about 20 percent.\34\ Patients with CAD also often experience other
significant health conditions, including diabetes. To improve care for
patients with CAD, most approaches in the private and public sectors
focus on improving the efficiency and quality of care around procedures
such as PCI and CABG. The BPCI models are an example of such an
approach. As discussed previously in this section, our proposal for the
AMI model extends beyond a procedure-based EPM to include beneficiaries
hospitalized for medical management or PCI for AMI in a single EPM, and
we proposed to test the CABG model, which also would include
beneficiaries with AMI, at the same participant hospitals. We believe
that hospitalization for AMI, whether accompanied solely by medical
management or including revascularization during the initial
hospitalization or in a planned CABG
[[Page 201]]
readmission, is a sentinel event indicating the need for an increased
focus on condition-specific management, as well as on care coordination
and active management to prevent future acute events, both during the
AMI and CABG episodes and beyond. We also believe that improving the
quality and efficiency of CAD care over a long period of time is
important given the chronic nature of this condition that has serious
implications for beneficiary health.
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\34\ National Center for Chronic Disease Prevention and Health
Promotion, Division for Heart Disease and Stroke Prevention, August
10, 2015.
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The AMI and CABG models provide an opportunity for us to
incentivize CAD-specific care management and care coordination for AMI
and CABG model beneficiaries that lays the groundwork for longer-term
improvements in quality and efficiency of care for beneficiaries with
CAD. We note that the quality measures proposed for use in the pay-for-
performance methodologies of the AMI and CABG models do not currently
include longer-term outcomes or patient experience outside of the AMI
or CABG episode itself, as discussed in sections III.E.2.b. and c. of
the proposed rule (81 FR 50794), although we were interested in
comments about potential future measures that could incorporate longer-
term outcomes. Moreover, as discussed in section VI. of the proposed
rule (81 FR 50794), we also proposed to test a cardiac rehabilitation
(CR)/intensive cardiac rehabilitation (ICR) incentive payment,
hereinafter CR incentive payment, in AMI and CABG model participants
located in some of the MSAs selected for AMI and CABG model
participation, as well as in hospitals located in some of the MSAs that
are not selected for AMI or CABG model participation. We proposed to
evaluate the effects of the CR incentive payment in the context of an
episode payment model and Medicare FFS on utilization of CR/ICR, as
well as short-term (within the period of time extending 90 days
following hospital discharge from an AMI or CABG hospitalization) and
longer-term outcomes. We believe this test may result in valuable
findings about effective strategies to increase utilization of CR/ICR
services that have a strong evidence-base for their effectiveness but a
long history of underutilization.
The following is a summary of the comments received and our
responses.
Comment: A number of commenters expressed support for the proposed
AMI and CABG models, characterizing the proposals as a good first step
toward achieving greater focus not only on cardiac care quality
improvement but also care coordination for the anchor admission through
post-acute care management of patients and families. Several commenters
believe that CMS' proposal to implement separate models for
beneficiaries undergoing treatment for AMI versus CABG surgery was
sensible given the typical recovery pathways experienced by
beneficiaries. One commenter noted that while the majority of
beneficiaries with AMI or CABG have CAD, not all will have this
condition as CMS stated in the proposed rule (81 FR 50807).
Several commenters commended CMS for developing a clinically
appropriate definition for AMI because AMI is a condition that can
require a range of treatments, including both medical treatments and
PCI. The commenters observed that the combination of AMI medical
management and PCI into a single AMI episode is likely to present AMI
model participants with greater opportunity than if the hospital
managed just one of the MS-DRG groupings. They stated that the proposal
to include both medical and PCI MS-DRG groupings in the AMI model would
increase each hospital's AMI episode volume relative to a single MS-DRG
grouping, and further noted that sufficient volume in any bundled
payment model is key to ensuring that financial results are not
primarily driven by random variation.
Several commenters observed that the proposed AMI model would be
the first Innovation Center bundled payment model to combine medical
and procedural care in a single episode and that the majority of
beneficiaries in the AMI model would be experiencing a life-threatening
emergency. These commenters believe the proposed AMI model has the
potential for patient harm and serious unintended consequences and
recommended CMS to maintain a dialogue with practicing clinicians from
medical specialty and subspecialty societies so that unintended
consequences are caught early. One commenter recommended that CMS
refocus the proposed AMI model to be treatment-based, separating
beneficiaries with AMI into two different treatment-based EPMs based on
medical management or PCI. The commenter contended that this approach
would be more straightforward for model participants and allow CMS to
conduct longer-term analyses of BPCI-like models in a more
representative cross-section of hospitals.
Other commenters recommended that CMS pursue only the CABG model,
arguing that the proposed AMI model, with complex, care pathway-
dependent prices and transfer pathways, would influence attribution and
result in serious uncertainties for AMI model participants. One
commenter reasoned that isolated CABG procedures are particularly well-
positioned for a bundled payment model that requires participation
because, despite the availability of robust clinical guidelines,
variability in the costs and outcomes of CABG persist. The commenter
noted that other entities, such as Arkansas and Tennessee Medicaid,
Washington State's Bree Collaborative, and commercial payers, have seen
the potential to improve the cost and quality of CABG through the
implementation of bundled payments. Several commenters stated that
initial implementation of the CABG model alone would allow CABG model
participants to focus efforts on a specific population that includes
the opportunity to excel in the care of CAD and gain some experience in
the care of emergent patients. This limited implementation strategy
would allow model participants to start to develop systems and models
of care that address the unique needs of these populations in a value-
driven equation. The commenters added that as hospitals work through
implementation and gain experience with the CABG model, CMS could then
phase in the inclusion of the much more complicated AMI model, which
would introduce a myriad of factors that would add to the complexity of
EPMs in which the hospital was a participant.
Another commenter who did not favor implementation of the proposed
AMI model reasoned that, in addition to the built-in incentives of MS-
DRGs that currently reward hospitals and physicians for complications
that occur during the beneficiary's hospitalization by providing a
higher IPPS payment for beneficiaries with complications, the proposed
AMI model lacked incentives to manage beneficiaries to reduce CAD
complications such as AMI. Instead, the commenter stated that the
proposed AMI model would incentivize admitting patients who are
marginally symptomatic for AMI that is a complication of CAD, contrary
to the overall goals of EPMs to lower the incidence of complications.
The commenter cited a body of research that has shown that optimal
management of CAD can significantly lower the incidence of AMI. The
commenter recommended CMS to move toward condition-specific episode
payment defined by diagnosis codes, and to halt implementation of an
event-based EPM for AMI that is, in itself, a complication from the
lack of optimal management of CAD. The commenter also stated that CMS
should implement site-agnostic
[[Page 202]]
PCI episodes so the incentives under the model would be to provide care
in the place of service best suited for the patient. Another commenter
expressed concerns about bundling AMI care, as it encompasses a broad
spectrum of many different complex illnesses. Several commenters
observed that while some AMI patients require less complex care, other
patients are admitted with multiple comorbidities and require a higher
intensity of care, which may involve multiple organs and a variety of
care resources. Other commenters believe that if CMS implements the AMI
model as proposed, more beneficiaries would move into the CABG model
because of the AMI model financial incentives, which would not be in
the best interests of beneficiaries.
While some commenters recommended a short implementation delay for
the AMI and/or CABG models, several other commenters recommended that
CMS delay the AMI and CABG models, with recommendations ranging from 6
to 36 months. These commenters believe this delay would provide
sufficient time for CMS to incorporate known best practices from the
Healthcare Payment Learning and Action Network (LAN) Clinical Episode
Payment (CEP) Work Group and lessons learned from both the BPCI and CJR
models into the design of the cardiac EPMs. Otherwise, the commenters
were concerned that the cardiac EPMs would both put beneficiaries at
risk and disadvantage providers, as the episodes would be built using
designs that were not supported by CMS' own panel of industry experts.
Some commenters expressed concern about expanding EPMs to complex
conditions such as AMI and CABG, where treatment can follow multiple
evidence-based care pathways. One commenter pointed out that the
proposed AMI and CABG models would generally include beneficiaries
receiving unplanned care due to an acute event, making the population's
care difficult to manage. The commenter requested that CMS not
implement the proposed cardiac EPMs. Several commenters stated that the
complexity of the proposed cardiac EPMs was so great that CMS had
essentially proposed a completely different payment system for cardiac
care and would provide EPM participants with little time to prepare and
plan for implementation. The commenters believe that decisions about
appropriate care should be made by physicians and their patients and
should be based on each patient's medical necessity and care
preferences. They stated that bundling clinically complex episodes with
multiple care pathways may lead to factors other than medical necessity
and care preferences influencing the decisions that providers make, and
that such decisions could have a long-term impact on a patient's health
and well-being and may increase costs in the long run while achieving
the short-term goal of reducing episodic costs. The commenters believe
that this potentially serious issue warranted immediate attention by
CMS, given the lack of evidence on the impact of the EPMs on key
patient-centered outcomes, and concluded that the proposed EPMs require
further consideration and study before additional bundling initiatives
are implemented.
MedPAC stated that the proposed AMI episodes did not appear to be a
promising place to further test bundled payment because AMI episodes
have relatively low post-acute care use and the associated post-acute
care spending makes up a small share of total episode spending. They
concluded that savings opportunities for participating providers would
be smaller compared with other conditions. Consistent with the
observations of a few other commenters, MedPAC stated that complex
medical conditions such as AMI do not involve a single clinical pathway
but rather can involve patient transfers to hospitals with more
intensive cardiac capabilities and subsequent readmissions for CABG.
While MedPAC acknowledged that CMS' proposed rule addressed these
issues, they noted that if the benchmark prices are not accurate, the
prices could inadvertently shape clinical practice or encourage
selective admissions. Instead of an EPM, MedPAC suggested that CMS
consider allowing hospitals to share savings with physicians as a way
to focus physicians on reducing the cost of the inpatient stay for AMI
care.
MedPAC further concluded that CABG was also not an ideal condition
for testing bundled payment models because, although the majority of
beneficiaries undergoing CABG go on to use post-acute care services,
the spending on post-acute care services is relatively low compared to
other clinical conditions. They noted that with the inpatient stay
comprising the vast majority of total episode spending, the
opportunities to realize savings by changing clinical practice would be
small. MedPAC presented an additional concern regarding the potential
for undesirable provider responses to financial incentives, including
patient selection, in the proposed CABG model. They claimed that
providers of cardiac care have been shown to engage in patient
selection and expressed concern that, with larger savings at stake,
these behaviors could increase. They recommended that CMS delay testing
the CABG model until the benefits of episode efficiency outweigh the
concerns about patient selection.
Response: We appreciate the support of some of the commenters for
our proposal to implement the AMI and CABG models. The proposed cardiac
models represent clinical conditions that result in a significant
burden of morbidity and expenditures in the Medicare population.
However, we acknowledge the great diversity of views about the AMI and
CABG models reflected in the comments.
We proposed AMI as the episode for an EPM because we recognized it
as a significant clinical condition for which evidence-based clinical
guidelines are available for the most common AMI scenarios that begin
with a beneficiary's presentation for urgent care, most commonly to a
hospital emergency department. The hospital phase involves medical
management for all patients, as well as potential revascularization,
most commonly with PCI. As commenters observed, the AMI model is the
first Innovation Center episode payment model that includes
substantially different clinical care pathways (medical management and
PCI) for a single clinical condition in one episode in a model. In this
sense the AMI model is a condition-specific EPM, although it is not
focused on the underlying CAD condition that puts some beneficiaries at
risk for the AMI but rather on the AMI itself. While we recognize that
AMI may be a complication of care from inadequately managed CAD, we
continue to believe that there is an important role for the AMI model
in testing bundled payment for beneficiaries with AMI who follow a
variety of clinical pathways because AMI is a sentinel event indicating
the need for an increased focus on condition-specific management. The
proposed 90 day post-discharge episode duration would provide a
springboard to heighten the focus on CAD-specific management. While
future models may focus on CAD management itself, including reducing
the risk of AMI, in addition to the current Million Hearts[supreg]
Cardiovascular Risk Reduction Model, we believe that the proposed AMI
model also plays an important role in testing an EPM for this clinical
condition which is not always avoidable even in the context of the best
practices to manage CAD on an ongoing basis.\35\
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\35\ Million Hearts[supreg]: Cardiovascular Disease Risk
Reduction Model. https://innovation.cms.gov/initiatives/Million-Hearts-CVDRRM/.
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We believe that it is important to test EPMs like the AMI model
where
[[Page 203]]
beneficiaries can follow multiple clinical pathways, including
transfers among hospitals with different cardiac care capacity because,
more commonly than not, beneficiaries who are hospitalized for an
emergent clinical condition do not constitute as homogeneous a group as
those who choose to undergo elective surgery. However, there likely are
significant opportunities to improve the quality and efficiency of
episode care through care redesign that improves care coordination and
management for beneficiaries unexpectedly hospitalized for treatment
following a cardiac event. We disagree with the commenter who
recommended that we create two treatment-based EPMs, AMI medical
management and PCI, because, in the context of our proposed pricing
methodology that sets MS-DRG-specific EPM-episode benchmark prices and
quality-adjusted target prices as discussed in section III.D.4.b.(1).
of this final rule, we believe we can appropriately include
beneficiaries following the two different treatment approaches in the
same EPM without concern that the financial incentives of the EPM are
influencing the treatment choice for beneficiaries.
We appreciate the support of many commenters for the proposed CABG
model. We believe that CABG may play a role for some beneficiaries with
symptomatic CAD, either with or without AMI, because CABG is associated
with lower longer-term rates of major adverse cardiac and
cerebrovascular events in comparison to PCI for certain groups of
patients. As a number of commenters pointed out, multiple other
entities, including states, are testing CABG bundled payment models due
to the variability in costs and outcomes despite robust clinical
guidelines.
In response to those commenters who recommended that the AMI and
CABG models be delayed in order to incorporate known best practices
from the LAN CEP Work Group, we note that the LAN is a public-private
partnership established by the U.S. Department of Health and Human
Services (HHS) to increase the adoption of APMs that promote better
care, smarter spending, and healthier people. The LAN has a voluntary
collaborative structure and its consensus recommendations do not
necessarily reflect the views of its individual participants.
Representatives from CMS, along with representatives from states,
purchasers, providers, commercial payers, and consumers, were active
participants in the CEP Work Group and developed, with input from the
broader LAN network, a set of recommendations that reflect a consensus
view, balancing innovation with current practice to move the health
care delivery system forward. The CEP Work Group full recommendations
have not yet been tested in the market. The LAN CEP Work Group
recommendations and the proposed CMS CABG and AMI EPMs, although
incorporating different design features, both support the
implementation of episode-based payment models for cardiac care. We
anticipate that both the LAN recommendations and the CMS AMI and CABG
models will expand provider experience and expertise regarding the
necessary resources and most effective strategies for providing high
quality, efficient care through episode-based payment models and will
help prepare the market for further adoption of innovative payment
models in the future. Therefore, we believe that best practices for
episode payment models are continuously being identified and refined
based on providers' actual implementation experiences with episode
payment models of various designs. Rather than redesigning the proposed
cardiac care models to conform to the LAN CEP Work Group
recommendations, we look forward to testing the AMI and CABG models
based on the policies included in this final rule and sharing our
evaluation findings with stakeholders to inform other episode payment
models for cardiac care.
We do not agree with MedPAC's conclusion that the proposed AMI and
CABG models do not hold promise because of limited post-acute care
spending in AMI episodes and the high percentage of CABG episode
spending due to the anchor hospitalization in CABG episodes coupled
with the risk of patient selection due to the financial incentives of
the CABG model. While care redesign to improve the efficiency of post-
acute care use may be an obvious strategy to address variation in
episode spending for those episodes, such as SHFFT and LEJR episodes
with high utilization of post-acute care services, AMI and CABG
beneficiaries have substantial episode spending during 90 days post-
discharge from the anchor hospitalization as a result of complications,
further treatment, and ongoing care management of their underlying
chronic conditions. We believe that increased efficiencies in the post-
discharge care and improved care coordination represent a significant
opportunity to improve the quality and reduce the cost of AMI and CABG
episodes.
As commenters pointed out, the cardiac EPMs create some risks of
harm to beneficiaries from patient selection and different treatment
choices EPM participants could adopt based on the financial incentives
under the EPMs, although we believe these concerns are generally
present for every episode payment model that sets a price that Medicare
pays for an episode-of-care. As discussed further in sections III.G.4.
through 6. of this final rule, we will take steps to prevent potential
harm by monitoring for access to care, quality of care, and delayed
care under the EPMs and may take remedial action against EPM
participants if we find evidence that supports concerns in these areas.
In addition, the evaluation as discussed in section IV. of this final
rule will analyze beneficiary outcomes and their relationship to
clinical pathways under the EPMs.
We refer to section III.D.2.a. of this final rule for a discussion
of the comments on the proposed implementation timeline for the AMI and
CABG models and our responses.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal to implement the AMI and CABG
models, with modifications to specific policies as described throughout
this final rule. We refer to section III.D.2.a. of this final rule for
the implementation timeline that applies to the AMI and CABG models.
2. Advanced Alternative Payment Model Considerations
For ease of reading the subsequent sections regarding our proposals
and our final policies around the EPMs as Advanced APMs, we first
present the proposals outlined in the Quality Payment Program proposed
rule (81 FR 28161) followed by the policies outlined in the Quality
Payment Program final rule with comment period (81 FR 77008).
a. Overview for the EPMs
The MACRA created two paths for eligible clinicians to link quality
to payments: The MIPS and Advanced APMs. These two paths create a
flexible payment system called the Quality Payment Program as proposed
by CMS in the Quality Payment Program proposed rule (81 FR 28161
through 28586).
As proposed in the Quality Payment Program proposed rule, an APM
must meet three criteria to be considered an Advanced APM (81 FR
28298). First, the APM must provide for payment for covered
professional services based on quality measures comparable to measures
described under the performance category described in section
1848(q)(2)(B)(i) of the Act,
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which is the MIPS quality performance category. We interpret this
criterion to require the APM to incorporate quality measure results as
a factor when determining payment to participants under the terms of
the APM. Under the Quality Payment Program proposed rule, we proposed
that the quality measures on which the Advanced APM bases payment for
covered professional services (as that term is defined in section
1848(k)(3)(A) of the Act) must include at least one of the following
types of measures, provided that they have an evidence-based focus and
are reliable and valid (81 FR 28302):
Any of the quality measures included on the proposed
annual list of MIPS quality measures.
Quality measures that are endorsed by a consensus-based
entity.
Quality measures developed under section 1848(s) of the
Act.
Quality measures submitted in response to the MIPS Call
for Quality Measures under section 1848(q)(2)(D)(ii) of the Act.
Any other quality measures that CMS determines to have an
evidence-based focus and be reliable and valid.
As we discussed in the Quality Payment Program proposed rule,
because the statute identifies outcome measures as a priority measure
type and we wanted to encourage the use of outcome measures for quality
performance assessment in APMs, we further proposed in that rule that,
in addition to the general quality measure requirements, an Advanced
APM must include at least one outcome measure if an appropriate measure
is available on the MIPS list of measures for that specific QP
Performance Period, determined at the time when the APM is first
established (81 FR 28302 through 28303).
Second, the APM must either require that participating APM Entities
bear risk for monetary losses of a more than nominal amount under the
APM or be a Medical Home Model expanded under section 1115A(c) of the
Act. Except for Medical Home Models, we proposed in the Quality Payment
Program proposed rule that, for an APM to meet the nominal amount
standard, the specific level of marginal risk must be at least 30
percent of losses in excess of expected expenditures; a minimum loss
rate, to the extent applicable, must be no greater than 4 percent of
expected expenditures; and total potential risk must be at least 4
percent of expected expenditures (81 FR 28306).
Third, the APM must require participants to use CEHRT (as defined
in section 1848(o)(4) of the Act), as specified in section
1833(z)(3)(D)(i)(I) of the Act, to document and communicate clinical
care with patients and other health care professionals. Specifically,
where the APM participants are hospitals, the APM must require each
hospital to use CEHRT (81 FR 28298 through 28299).
In the proposed rule (81 FR 50794), we proposed to adopt two
different tracks for the EPMs--Track 1 in which EPMs and EPM
participants would meet the criteria for Advanced APMs as proposed in
the Quality Payment Program proposed rule, and Track 2 in which the
EPMs and EPM participants would not meet those proposed criteria. For
the proposed AMI, CABG, and SHFFT models, we proposed pay-for-
performance methodologies that use quality measures that we believe
would meet the proposed Advanced APM quality measure requirements in
the Quality Payment Program proposed rule. As discussed in sections
III.E.2. and 3. of the proposed rule (81 FR 50794), all but one of the
AMI, CABG, and SHFFT model measures used in the EPM pay-for-performance
methodologies are NQF-endorsed and have an evidence-based focus and are
reliable and valid. Therefore, we believe they would meet the proposed
Advanced APM general quality measure requirements. The Excess Days in
Acute Care after Hospitalization for AMI (AMI Excess Days) measure,
which was proposed for the AMI model, is not currently NQF-endorsed,
but was reviewed, recommended for endorsement, and is expected to be
formally endorsed within the first quarter of 2017. We believe it meets
the measure requirements by having an evidence-based focus and being
reliable and valid because this measure has been proposed and adopted
through rulemaking for use in the Hospital Inpatient Quality Reporting
(HIQR) Program.
Each of the proposed EPM pay-for-performance methodologies included
one outcome measure that is NQF-endorsed, has an evidence-based focus,
and is reliable and valid. The EPM quality measures were discussed in
detail in section III.E. of the proposed rule (81 FR 50794), where we
assigned the quality measures to quality domains. For the AMI model, we
proposed to use the Hospital 30-Day, All-Cause, Risk-Standardized
Mortality Rate (RSMR) Following Acute Myocardial Infarction (NQF #0230)
(MORT-30-AMI) outcome measure. For the CABG model, we proposed to use
the Hospital 30-Day, All-Cause, Risk-Standardized Mortality Rate (RSMR)
Following Coronary Artery Bypass Graft (CABG) Surgery (NQF# 2558)
(MORT-30-CABG) outcome measure. Finally, for the SHFFT model, we
proposed to use the Hospital-level RSCR following elective primary THA
and/or TKA (NQF #1550) (Hip/Knee Complications) outcome measure. Thus,
based on the proposed use of these three outcomes measures in the EPMs,
we believed the proposed AMI, CABG, and SHFFT models would meet the
requirement proposed for Advanced APMs in the Quality Payment Program
proposed rule for use of an outcome measure that also meets the general
quality measure requirements.
In terms of the proposed nominal risk criteria for Advanced APMs,
beginning in performance year 2 for episodes ending between April 1,
2018 and December 31, 2018, we proposed that EPM participants would
begin to bear downside risk for excess actual EPM-episode spending
above the quality-adjusted target price as discussed in section
III.D.2.c. of the proposed rule (81 FR 50794). The marginal risk for
excess actual EPM-episode spending above the quality-adjusted target
price would be 100 percent over the range of spending up to the stop-
loss limit, which would exceed 30 percent marginal risk, and there
would be no minimum loss rate. As a result, we believed the EPMs would
meet the marginal risk and minimum loss rate elements of the nominal
risk criteria for Advanced APMs proposed in the Quality Payment Program
proposed rule. We proposed that total potential risk for most EPM
participants would be 5 percent of expected expenditures beginning in
the second quarter of performance year 2, and increasing in subsequent
performance years as discussed in section III.D.7.b. of the proposed
rule (81 FR 50794). Therefore, in the proposed rule, we stated our
belief that the total proposed potential risk applicable to most EPM
participants, with the lowest total potential risk being 5 percent for
EPM episodes ending on or after April 1, 2018 in performance year 2,
would meet the total potential risk element of the nominal risk amount
standard for Advanced APMs proposed in the Quality Payment Program
proposed rule because it was greater than the value of at least 4
percent of expected expenditures.
We note that we proposed that EPM participants that are rural
hospitals, sole community hospitals (SCHs), Medicare Dependent
Hospitals (MDHs) and Rural Referral Centers (RRCs) would have a stop-
loss limit of 3 percent beginning in the second quarter of performance
year 2 as discussed in section III.D.7.c. of the proposed rule (81 FR
50794). Because 3 percent was less than the proposed
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threshold of at least 4 percent of expected expenditures for total
potential risk proposed for Advanced APMs in the Quality Payment
Program proposed rule, those rural hospitals, SCHs, MDHs, and RRCs that
are EPM participants subject to special protections would be in Track 2
EPMs that would not meet the proposed nominal risk standard for
Advanced APMs for performance year 2. We recognized that this proposal
might initially limit the ability of rural hospitals, SCHs, MDHs, and
RRCs to be in Track 1 EPMs that are Advanced APMs. In the proposed
rule, we explained our belief that this potential limitation on rural
hospitals, SCHs, MDHs, and RRCs is appropriate for the following
reasons: (1) Greater risk protections for these hospitals proposed for
the EPMs beginning in the second quarter of performance year 2 and
subsequent performance years compared to other EPM participants are
necessary, regardless of their implications regarding Advanced APMs
based on the nominal risk standard proposed in the Quality Payment
Program proposed rule, because these hospitals have unique challenges
that do not exist for most other hospitals, such as being the only
source of health care services for beneficiaries or certain
beneficiaries living in rural areas or being located in areas with
fewer providers, including fewer physicians and post-acute care
facilities; and (2) under the risk arrangements proposed for the EPMs,
these hospitals would not bear an amount of risk in performance year 2
that we determined to be more than nominal in the Quality Payment
Program proposed rule. However, we sought comment on whether we should
allow EPM participants that are rural hospitals, SCHs, MDHs, or RRCs to
elect a higher stop-loss limit for the part of performance year 2 where
downside risk applies in order to permit these hospitals to be in Track
1 EPMs for that part of performance year 2. We noted that by
performance year 3, the stop-loss limit for these hospitals with
special protections under the EPMs would increase to 5 percent under
our proposal, so these hospitals could be in Track 1 EPMs based on the
nominal risk standard proposed in the Quality Payment Program proposed
rule.
As addressed in the Quality Payment Program proposed rule, it would
be necessary for an APM to require the use of CEHRT in order to meet
the criteria to be considered to be an Advanced APM. Therefore,
according to the requirements proposed in the Quality Payment Program
proposed rule, so that the EPMs may meet the proposed criteria to be
Advanced APMs, we proposed to require EPM participants to use CEHRT (as
defined in section 1848(o)(4) of the Act) to participate in Track 1 of
the EPMs. We proposed that Track 1 EPM participants must use certified
health IT functions, in accordance with the definition of CEHRT under
our regulation at Sec. 414.1305 (81 FR 77537), to document and
communicate clinical care with patients and other health care
professionals as proposed in the Quality Payment Program proposed rule
(81 FR 28299). We believed this proposal would allow Track 1 EPMs to be
able to meet the proposed criteria to be Advanced APMs.
Without the collection of identifying information on eligible
clinicians (physicians, non-physician practitioners, physical and
occupational therapists, and qualified speech-language pathologists)
who would be considered Affiliated Practitioners as proposed in the
Quality Payment program proposed rule under the EPMs, CMS would not be
able to consider participation in the EPMs in making determinations as
to whom could be considered a QP (81 FR 28320). As detailed in the
Quality Payment Proposed rule, these determinations are based on
whether the eligible clinician meets the QP threshold under either the
Medicare Option starting in payment year 2019 or the All-Payer
Combination Option, which is available starting in payment year 2021
(81 FR 28165). Thus, we made proposals in the following sections to
specifically address these issues that might otherwise preclude the
EPMs from being considered Advanced APMs, or prevent us from
operationalizing them as Advanced APMs. Based on the proposals for
Advanced APM criteria in the Quality Payment Program proposed rule, we
sought to align the design of the proposed EPMs with the proposed
Advanced APM criteria and enable CMS to have the necessary information
on eligible clinicians to make the requisite QP determinations.
For ease of reading the subsequent sections regarding our proposals
and final policies for the EPMs as Advanced APMs, we present the
following definitions from Sec. 414.1305 that have now been finalized
in the Quality Payment Program final rule with comment period (81 FR
77008).
Alternative Payment Model (APM) means any of the following: (1) A
model under section 1115A of the Act (other than a health care
innovation award); (2) The shared savings program under section 1899 of
the Act; or (3) A demonstration under section 1866C of the Act. (4) A
demonstration required by federal law.
Episode payment model means an APM or other payer arrangement
designed to improve the efficiency and quality of care for an episode
of care by bundling payment for services furnished to an individual
over a defined period of time for a specific clinical condition or
conditions.
APM Entity means an entity that participates in an APM or payment
arrangement with a non-Medicare payer through a direct agreement or
through Federal or State law or regulation.
Advanced Alternative Payment Model (Advanced APM) means an APM that
CMS determines meets the criteria set forth in Sec. 414.1415.
Advanced APM Entity means an APM Entity that participates in an
Advanced APM or Other Payer Advanced APM.
Participation List means the list of participants in an APM Entity
that is compiled from a CMS-maintained list.
Eligible Clinician means ``eligible professional'' as defined in
section 1848(k)(3) of the Act, as identified by a unique TIN and NPI
combination and, includes any of the following: (1) A physician; (2) A
practitioner described in section 1842(b)(18)(C) of the Act; (3) A
physical or occupational therapist or a qualified speech language
pathologist; or (4) A qualified audiologist (as defined in section
1861(ll)(3)(B) of the Act).
Affiliated Practitioner means an eligible clinician identified by a
unique APM participant identifier on a CMS-maintained list who has a
contractual relationship with the Advanced APM Entity for the purposes
of supporting the Advanced APM Entity's quality or cost goals under the
Advanced APM.
Affiliated Practitioner List means the list of Affiliated
Practitioners of an APM Entity that is compiled from a CMS-maintained
list.
Qualifying APM Participant (QP) means an eligible clinician
determined by CMS to have met or exceeded the relevant QP payment
amount or QP patient count threshold under Sec. 414.1430(a)(1),
(a)(3), (b)(1), or (b)(3) for a year based on participation in an
Advanced APM Entity.
QP Patient Count Threshold means the minimum threshold score
specified in Sec. 414.1430(a)(3) and (b)(3) that an eligible clinician
must attain through a patient count methodology described in Sec. Sec.
414.1435(b) and 414.1440(c) to become a QP for a year.
QP Payment Amount Threshold means the minimum threshold score
specified in Sec. 414.1430(a)(1) and (b)(1) that an eligible clinician
must attain through the payment amount methodology described in
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Sec. Sec. 414.1435(a) and 414.1440(b) to become a QP for a year.
Threshold Score means the percentage value that CMS determines for
an eligible clinician based on the calculations described in Sec.
414.1435 or Sec. 414.1440.
Merit-based Incentive Payment System (MIPS) means the program
required by section 1848(q) of the Act.
MIPS APM means an APM that meets the criteria specified under Sec.
414.1370(b).
Improvement Activities means an activity that relevant MIPS
eligible clinicians, organizations and other relevant stakeholders
identify as improving clinical practice or care delivery and that the
Secretary determines, when effectively executed, is likely to result in
improved outcomes.
Based on the proposals for Advanced APM criteria in the Quality
Payment Program proposed rule (81 FR 28161), we sought to align the
design of the proposed EPM Advanced APM track with the proposed
Advanced APM criteria and enable CMS to have the necessary information
on Eligible Clinicians to make the requisite QP determinations. As
detailed in the Quality Payment Program final rule with comment period,
QP determinations are based on whether the Eligible Clinician meets the
QP threshold under either the Medicare Option starting in payment year
2019 or the All-Payer Combination Option, which is available starting
in payment year 2021 (81 FR 77013). Eligible clinicians seeking QP
determinations as early as performance year 2 would need to meet the QP
threshold under the Medicare Option. The three criteria for an Advanced
APM were finalized in the Quality Payment Program final rule with
comment period (81 FR 77008), and we continue to align the design of
the finalized EPMs with the finalized Advanced APM criteria so that EPM
participants who choose to use and attest to use of CEHRT may
participate in an EPM that meets the criteria of an Advanced APM. To be
determined to be an advanced APM, an APM must meet three Advanced APM
criteria identified in Sec. 414.1415 and discussed specifically later
in this section.
First, the APM must require participants to use CEHRT (as defined
in section 1848(o)(4) of the Act), as specified in section
1833(z)(3)(D)(i)(I) of the Act, to document and communicate clinical
care with patients and other health care professionals (81 FR 77406).
Specifically, where the APM participants are hospitals, the APM must
require each hospital to use CEHRT. As addressed in the Quality Payment
Program final rule with comment period, it is necessary for an APM to
require the use of CEHRT in order to meet the criteria to be considered
to be an Advanced APM. Therefore, according to the requirements now
finalized in the Quality Payment Program final rule with comment
period, so that the EPMs may meet the finalized criteria to be Advanced
APMs, we proposed that those EPM participants who choose to participate
in Track 1 of the EPMs must use certified health IT functions, in
accordance with the definition of CEHRT under our regulation at 42 CFR
414.1305, to document and communicate clinical care with patients and
other health care professionals. We believe that this proposal set
forth in the EPM proposed rule would allow EPM participants who use and
attest to use of CEHRT to be in an EPM that meets the first finalized
Advanced APM criterion.
Second, the APM must provide for payment to participants based on
performance on quality measures comparable to measures described under
the performance category described in section 1848(q)(2)(B)(i) of the
Act, which is the MIPS quality performance category. We interpret this
criterion to require the APM to incorporate quality measure results as
a factor when determining payment to participants under the terms of
the APM as described in the Quality Payment Program final rule with
comment period (81 FR 77414). In order to align the EPMs with the
Quality Payment Program final rule with comment period, the quality
measures on which the Advanced APM bases payment to participants must
include at least one of the following types of measures, provided that
they have an evidence-based focus and are reliable and valid (81 FR
77418):
Any of the quality measures included on the proposed annual list of
MIPS quality measures.
Quality measures that are endorsed by a consensus-based entity.
Quality measures developed under section 1848(s) of the Act.
Quality measures submitted in response to the MIPS Call for Quality
Measures under section 1848(q)(2)(D)(ii) of the Act.
Any other quality measures that CMS determines to have an evidence-
based focus and be reliable and valid.
As we discussed in the Quality Payment Program final rule with
comment period, because the statute identifies outcome measures as a
priority measure type and we want to encourage the use of outcome
measures for quality performance assessment in APMs, we further
finalized in that rule that, in addition to the general quality measure
requirements, an Advanced APM must include at least one outcome measure
if an appropriate measure is available on the MIPS list of measures for
that specific QP Performance Period, determined at the time when the
APM is first established (81 FR 77418). Therefore, according to the
requirements finalized in the Quality Payment Program final rule with
comment period and the quality measures finalized in section III.E of
this final rule that are the proposed EPM quality measures with an
additional voluntary measure for the CABG model, the EPMs will meet the
second finalized criterion of the Advanced APM criteria.
Third, the Quality Payment Program final rule with comment period
requires that for an APM to meet the Advanced APM criteria, the APM
must either require that participating APM Entities bear risk for
monetary losses of a more than nominal amount under the APM or be a
Medical Home Model expanded under section 1115A(c) of the Act. For the
purposes of the EPM, the generally applicable nominal amount standard
for an Advanced APM in the Quality Payment Program final rule with
comment period (81 FR 77425) means the total amount an APM Entity
potentially owes CMS or foregoes under an APM must be at least equal to
3 percent of the expected expenditures for which an APM Entity is
responsible under the APM. The generally applicable financial risk
standard (81 FR 77422) means when an APM Entity's actual expenditures
for which the APM Entity is responsible under the APM exceed expected
expenditures during a specified QP Performance Period, the APM Entity
is required to owe payment(s) to CMS. We refer to the Quality Payment
Program final rule with comment period for a discussion regarding why
we did not finalize the specific level of marginal risk or minimum loss
rate (81 FR 77426). However, consistent with the commitments we made to
adhere to the proposed marginal risk and minimum loss rate requirements
in the Quality Payment Program proposed rule, we note that the
financial risk in this final rule when the EPMs involve downside risk
exceeds the proposed marginal risk and minimum loss rate requirements
proposed for the Quality Payment Program. As discussed in sections
III.D.7.b. and c. and displayed in Table 12 of this final rule, the
final total initial risk of expected expenditures for EPM participants
of 5 percent, and 3 percent for rural hospitals, SCHs, MDHs, RRCs,
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and EPM volume protection hospitals subject to separate stop-loss
protections, beginning in performance year 3 when downside risk for all
participants first applies, would meet the total potential risk element
of the nominal risk amount standard for Advanced APMs finalized in the
Quality Payment Program final rule with comment period (81 FR 77427)
because they are greater than or equal to the value of at least 3
percent of expected expenditures. Those EPM participants who elect
voluntary downside risk beginning in performance year 2 will be subject
to the same total risk of expected expenditures in performance year 2
and, therefore, will be in an EPM that meets the total potential risk
element of the nominal risk amount standard for Advanced APMs beginning
in performance year 2. Therefore, according to the requirements
finalized in the Quality Payment Program final rule with comment period
and the payment methodology for EPM participants finalized in section
III.D of this final rule, those EPM participants who voluntarily elect
downside risk for EPM episodes ending on or after January 1, 2018 will
be in an EPM that meets the third finalized criterion of the Advanced
APM criteria in performance year 2. All other EPM participants will be
in an EPM that meets the third finalized criterion of the Advanced APM
criteria in performance year 3.
Finally, we finalized in the Quality Payment Program final rule
with comment period (81 FR 77442) that for Advanced APMs, such as
episode payment models, in which there are some Advanced APM Entities
that include Eligible Clinicians on a Participation List and other
Advanced APM Entities that identify Eligible Clinicians only on an
Affiliated Practitioner List, we will identify Eligible Clinicians for
QP determinations based on the composition of the Advanced APM Entity.
In the scenario that applies to the EPM which includes only hospitals
as Advanced APM Entities on the Participation List, for those Advanced
APM Entities where there is an Affiliated Practitioner List that
identifies Eligible Clinicians, that Affiliated Practitioner List will
be used to identify the Eligible Clinicians for purposes of QP
determinations, and those Eligible Clinicians will be assessed
individually. Thus, to operationalize the EPM as an Advanced APM, our
proposal for the EPM to identify Eligible Clinicians on a clinician
financial arrangements list to construct the Affiliated Practitioner
list would identify those Eligible Clinicians for purposes of QP
determination, consistent with the policies finalized in the Quality
Payment Program final rule with comment period.
We received a number of public comments on our proposals for the
EPMs as Advanced APMs. A few commenters requested changes to the
policies proposed by CMS in the Quality Payment Program proposed rule
and not to specific proposals for the EPMs set forth in the EPM
proposed rule. These comments are out of scope for this rulemaking and
no responses are provided in this final rule. Nevertheless, we have
summarized this feedback related to the Quality Payment Program
proposed rule, as CMS will continue work to improve the Quality Payment
Program in part through future notice and comment rulemaking.
One commenter requested change to the definition of Affiliated
Practitioner to include rehabilitation therapists. Many commenters
requested changes to the definitions of the Affiliated Practitioner
List and/or Participation List to identify Eligible Clinicians for the
purposes of Advanced APMs, MIPS APMs, and the assignment by CMS of an
Improvement Activities score, which fulfills one of four categories for
MIPS assessment of cost and quality. Another commenter requested
changes to the performance period or the December 31 date by which an
Eligible Clinician could qualify for automatic credit for incentive
payment and/or clinical Improvement Activities performance. This
commenter reasoned that such changes would permit more Eligible
Clinicians to receive a QP determination, which may qualify them for an
APM incentive payment under MACRA. One commenter expressed uncertainty
regarding the process by which Eligible Clinicians could receive a QP
determination for the efforts of the EPM participant, and requested
that CMS clarify on the pathway for participating physicians to be in
an Advanced APM generally. Another commenter suggested CMS replace the
QP determination with the proposal that, for EPM providers who meet the
CEHRT use requirement and have 50 or more Medicare beneficiaries
attributed to these EPMs, the threshold for Advanced APMs would be met
automatically. A few commenters wanted CMS to use the Meaningful Use
program to gather attestation to CEHRT use from hospitals. A few
commenters strongly recommended CMS lower the patient count and payment
revenue thresholds used in the calculation of the Threshold Score to
meet QP Threshold Status as specified in the Quality Payment Program
proposed rule. Many commenters urged CMS to work closely with the
affected professional organizations and/or physician specialty
societies to design QP thresholds. One commenter requested changes to
the APM Entity such that the APM Entity lose the right to all or part
of otherwise guaranteed payment or payments as one of the options if
the APM Entity's actual aggregate expenditures exceed expected
aggregate expenditures. A few commenters requested changes to the
categorical exclusion that Medicare Advantage (MA) and other private
plans paid to act as insurers on the Medicare program's behalf are not
Advanced APMs, in light of the amount of risk taken by physicians in
MA. Finally, one commenter requested changes to the allow Independence
at Home participants who use CEHRT to qualify for Advanced APM
incentive payments.
The following is a summary of the comments received on our
proposals and our responses.
Comment: MedPAC commented that the EPM and CJR models should not be
considered Advanced APMs for the purposes of MACRA. MedPAC stated they
believe the following six principles should apply to Advanced APMs: the
Advanced APM entity should assume the financial risk and enroll
clinicians; be at financial risk for total Part A and Part B spending;
be responsible for a beneficiary population sufficiently large to
detect changes in spending and quality; have the ability to share
savings with beneficiaries; be provided certain regulatory relief by
CMS; and the enrolled clinicians should receive an incentive payment
only if the Advanced APM entity in which they participate is successful
in controlling cost, improving quality, or both. Under the proposed
EPMs, MedPAC believes the proposed rule contemplates large, loosely
connected groups of clinicians who may have very little involvement
with the beneficiaries in EPMs and hence have little reason to change
their practice patterns or reduce inappropriate episodes. If CMS
intends for clinicians to bear risk, MedPAC made the alternative
proposal that they could do so directly without having the hospital as
the intermediary.
Response: While we appreciate the principles for Advanced APMs
offered by MedPAC, we note that according to the Advanced APM
definition in the Quality Payment Program final rule with comment
period (81 FR 77008), the Track 1 EPMs that we proposed qualify as
Advanced EPMs as discussed previously in this section.
While we recognize EPM participants are the participating APM
Entities for
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the purposes of the Quality Payment Program, CMS will consider
participation of Eligible Clinicians in the Track 1 EPMs through
collection of identifying information from Track 1 EPM participants on
clinician financial arrangements lists as discussed in section
III.A.2.c. of this final rule who would then be included on the
Affiliated Practitioner List as defined in the Quality Payment Program
final rule with comment period at Sec. 414.1305 (81 FR 77537), in
order to determine who could be considered a QP. The requirements for
Eligible Clinicians to be reported on the clinician financial
arrangements lists help ensure that these clinicians have specific
involvement in caring for EPM beneficiaries and advancing the goals of
the EPMs to improve the quality and reduce the cost of care. Finally,
Eligible Clinicians can only be considered Qualifying Professionals or
Partial Qualifying Professionals and, therefore, potentially be exempt
from MIPS, if the Eligible Clinician meets the QP threshold or partial
QP threshold as described in the Quality Payment Program final rule
with comment period (81 FR 77433). Additionally, while we recognize the
concerns with EPM participants or CJR participant hospitals
intermediating the APM incentive payments, we believe that the QP
threshold incentivizes Eligible Clinicians to work with such
participants to improve health care delivery for Medicare
beneficiaries.
The qualification of the CJR model as an Advanced APM is discussed
in section V.O. of this final rule.
Comment: Many commenters expressed support for all organizations to
have the opportunities to participate as Advanced APMs and noted that
as proposed, rural hospitals, SCHs, MDHs, and RRCs that are EPM
participants would not potentially qualify for participation in an
Advanced APM until performance year 3 due to the proposed lower stop-
loss limits for these hospitals under the EPMs. Additionally, one
commenter recommended that a distinct CEHRT program be developed and
funding be allocated for non-physician and non-prescribing
professionals as soon as possible, as the cost of acquisition,
implementation, and maintenance of an EHR is a significant barrier to
adoption, particularly for small practices. One commenter observed this
proposal as an important illustration of why CMS must be flexible in
its definition of nominal risk, and how nominal will not mean the same
thing for every provider. As such, commenters supported retention of
the proposed stop-loss limits under the EPMs as the default rule for
these hospitals, thus enabling them to meet the nominal financial risk
standard for Track 1 EPMs (Advanced APMs) in performance year 3 rather
than performance year 2 when other EPM participants would be eligible
for Track 1 EPMs. However, commenters also believe CMS should also
explore options to allow these hospitals with additional stop-loss
protection under the EPMs to voluntarily elect a higher stop-loss limit
in order to participate in Track 1 EPMs in performance year 2.
Response: The Quality Payment Program final rule with comment
period (81 FR 77427) finalized the policy that an APM would meet the
nominal amount standard for an Advanced APM if, under the terms of the
APM, the total annual amount that an APM Entity potentially owes us or
foregoes is equal to at least 3 percent of the expected expenditures
for which an APM Entity is responsible under the APM. Therefore, rural
hospitals, SCHs, MDHs, RRCs, as well as EPM volume protection hospitals
as discussed in section III.D.7.c of this final rule, that are EPM
participants with special stop-loss limits could potentially qualify as
being in an Advanced APM as participants in a Track 1 EPM in
performance year 3, along the same timeframe as all other EPM
participants when downside risk for all participants is implemented, or
in performance year 2 when voluntary downside risk may be elected by
EPM participants (section III.D.2.c. of this final rule), based on the
stop-loss limits finalized in this rule for these hospitals as
discussed in section III.D.7.c. of this final rule.
Comment: Commenters proposed alternative processes by which a QP
determination could be made, including collective assessment of QP
status across both the AMI and CABG models, so as not to create siloed
EPMs. In cases where there is an overlap of beneficiaries in more than
one CMS model or program, other commenters proposed that beneficiaries
should be counted toward a physician's QP Threshold Score (a part of a
QP determination) if a beneficiary would have been assigned to a
particular model if it were not for the fact that a different model
that has required participation overlapped.
Response: The QP determination discussed in the Quality Payment
Program final rule with comment period depends on the level of payments
or patients furnished services through an Advanced APM based on the
calculations described in Sec. 414.1435 and Sec. 414.1440, as
applicable. Under certain Advanced APMs such as a Track 1 EPM, the
responsibility of cost and quality measurement and reporting is with
EPM participants that are hospitals rather than Eligible Clinicians.
However, we have specified that Eligible Clinicians who are on
Affiliated Practitioner Lists may also be assessed for a QP
determination based on their Affiliated Practitioner status if there
are no eligible clinicians on an Advanced APM's Participation List.
Therefore, as finalized in the Quality Payment Program final rule with
comment period (81 FR 77443), if an Eligible Clinician participates in
multiple Advanced APM Entities during a QP Performance Period, and is
not determined to be a QP based on participation in any of those
Advanced APM Entities, then we will assess the Eligible Clinician
individually using combined information for services associated with
that individual's NPI and furnished through all the Eligible
Clinician's Advanced APM Entities during the QP Performance Period.
This includes all Advanced APM Entities for which the Eligible
Clinician is represented on either a Participation List or Affiliated
Practitioner List that CMS uses for QP determinations. We will make
adjustments to ensure that patients and payments for services that may
be counted in the QP calculations for multiple Advanced APM Entities
(for example, payments for services furnished to a beneficiary
attributed to an ACO that are also part of an episode in an episode
payment model) are not double-counted for the individual. We believe
that this policy maintains the general principles behind Advanced APM
Entity-level QP determinations, while acknowledging the broader
commitment of individual Eligible Clinicians who are participating in
multiple Advanced APMs. We believe considering these Eligible
Clinicians individually is the most reasonable approach to capturing
the multiple potential permutations of participation in Advanced APMs
and providing Eligible Clinicians an equitable opportunity to become a
QP.
Thus, with respect to the commenters' concerns that CMS would only
make a model-specific QP determination for the Track 1 AMI model and
Track 1 CABG model and not a collective determination across the two
models, for Advanced APMs for which there is not a Participation List
that identifies eligible clinicians and there is an Affiliated
Practitioner List that identifies eligible clinicians, the Quality
Payment Program final rule with comment period (81 FR 77442) notes that
Affiliated Practitioner List will be
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used to identify the eligible clinicians for purposes of QP
determinations. Eligible clinicians on an Affiliated Practitioner List
will be assessed individually, unlike eligible clinicians on a
Participation List who are assessed as a group. Thus, we could make a
determination across the two models if an Eligible Clinician was not
determined to be a QP based on participation in any one of the Track 1
EPMs. Finally, as specified in the Quality Payment Program final rule
with comment period (81 FR 77013), QPs are Eligible Clinicians in an
Advanced APM who have a certain percentage of their patients or
payments through an Advanced APM. Thus, we will only count
beneficiaries attributed to an Advanced APM Entity toward a clinician's
QP Threshold Score and will not count those beneficiaries who would
have been attributed to an Advanced APM Entity if it were not for the
fact that a different model overlapped. Beneficiary attribution is
further discussed in the Quality Payment Program final rule with
comment period (81 FR 77436)
b. EPM Participant Tracks
To be considered an Advanced APM, the APM must require participants
to use CEHRT (as defined in section 1848(o)(4) of the Act), as
specified in section 1833(z)(3)(D)(i)(I) of the Act. We proposed that
all EPM participants must choose whether to meet the CEHRT use
requirement. EPM participants that do not choose to meet and attest to
the CEHRT use requirement would be in Track 2 of the EPMs. EPM
participants selecting to meet the CEHRT use requirement would be in
Track 1 of the EPMs and would be required to attest in a form and
manner specified by CMS to their use of CEHRT that meets the definition
in our regulation at Sec. 414.1305 (81 FR 77537) to document and
communicate clinical care with patients and other health professionals,
consistent with the proposal in the Quality Payment Program proposed
rule for the CEHRT requirement for Advanced APMs (81 FR 28299). EPM
participants choosing not to meet and attest to the CEHRT use
requirement would not be required to submit an attestation.
We believe that the voluntary selection by EPM participants to
elect downside risk for EPM episodes ending on or after January 1,
2018, and to meet and attest to the CEHRT use requirement would create
no significant additional administrative burden on EPM participants.
Moreover, the choice of whether to meet and attest to the CEHRT use
requirement would not otherwise change any EPM participant's
requirements or opportunity under the EPM. However, to the extent that
eligible clinicians who enter into financial arrangements related to
EPM participants in the Track 1 EPM are considered to furnish services
through an Advanced APM, those services could be considered for
purposes of determining whether the eligible clinicians are QPs.
The proposals for CEHRT use and attestation for EPM participants
were included in proposed Sec. 512.120(a). We sought comment on our
proposals for EPM participant CEHRT use requirements.
The following is a summary of the comments received and our
responses.
Comment: Commenters expressed appreciation for CMS' efforts to
expand the Advanced APM participation opportunities as they commented
that the 5 percent Advanced APM incentive payment is time-limited under
current law. They applauded the proposal to expand the list of eligible
Advanced APMs through Track 1 EPMs as it provides an incentive for
physicians to collaborate with hospital participants in the EPM and
could provide specialists, who otherwise may have limited avenues, to
participate in an Advanced APM. Other commenters requested specifically
that CMS clarify the steps necessary when a provider group wishes to
change from Track 2 to Track 1 in the EPMs.
Response: We appreciate the commenters' support for our proposal of
the Track 1 EPMs as Advanced APMs and agree that providing greater
opportunities for physician participation in Advanced APMs is an
important goal that can be advanced through our proposal. We remind
commenters that only the EPM participant can choose to participate in a
Track 1 EPM by using and attesting to use of CEHRT. If Eligible
Clinicians enter into a financial arrangement associated with a Track 1
EPM participant, then the EPM participant must submit a clinician
financial arrangements list that determines the Eligible Clinicians to
be included on the Affiliated Practitioner List for the purposes of the
Track 1 EPM that is an Advanced APM. Therefore, a provider group
interested in their members becoming Affiliated Practitioners with an
Advanced EPM Entity in an Advanced APM could work with a Track 1 EPM
participant to enter into a financial arrangement with that EPM
participant so that the members of the provider group could be included
in the clinician financial arrangements list submitted by the Track 1
EPM participant to CMS.
Comment: While commenters appreciated the proposal to include two
tracks for EPM participants and CJR participant hospitals, other
commenters made additional proposals to CMS to help operationalize
these tracks. A few commenters urged CMS to go further to align the
EPMs and the CJR model with the proposed Quality Payment Program and
configure Track 2 (the Non-Advanced APM) so that it could qualify as a
MIPS APM. In addition to the request that CMS reconfigure Track 2,
commenters also proposed that Track 2 EPM participants must also submit
a clinician financial arrangements list, so that Eligible Clinicians
could receive credit for Improvement Activities under MIPS and/or
satisfy criteria to be considered participants in MIPS APMs, for which
the Quality Payment Program applies unique scoring rules. One commenter
believes that the multiple options due to the proposed tracks increases
the level of complexity and administrative burden on the hospitals for
activities such as record keeping.
Response: We disagree that the presence of two EPM tracks increases
administrative burden as we continue to believe that the proposed
tracks allow flexibility for EPM participants to choose to participate
in an Advanced APM. While a Track 1 EPM participant needs to attest to
CEHRT and submit a clinician financial arrangements list to meet the
requirements for participation in an Advanced APM and allow us to
operationalize the Track 1 EPM as an Advanced APM, we do not believe
that these additional requirements create significantly increased
administrative burden on the Track 1 EPM participant versus a Track 2
EPM participant in view of the documentation and record access and
retention requirements for all EPM participants, which require EPM
participants to maintain a subset of that list that constitutes the
Eligible Clinicians, nor that the requirements to identify and maintain
related lists regarding collaboration agents and downstream
collaboration agents is a substantial burden. Beyond these additional
activities for Track 1 EPM participants, the policies of the EPMs are
the same for Track 1 and Track 2 EPM participants.
In addition, we disagree with the suggestion by commenters that we
add the requirement for Track 2 EPM participants to submit to CMS
clinician financial arrangements lists, information that we did not
propose to require Track 2 EPM participants to submit to us. Submission
of clinician financial arrangements lists is not necessary for
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implementation of the Track 2 EPMs, and Track 2 EPM participants do not
meet the definition of Advanced APM Entities in the Quality Payment
Program final rule with comment period at Sec. 414.1305 (81 FR 77537).
To require Track 2 EPM participants to submit such a list would create
unnecessary additional administrative burden on these participants.
Furthermore, a Track 2 EPM does not meet the criteria of a MIPS APM in
Sec. 414.1370(b) of the Quality Payment Program final rule with
comment period. Specifically, the MIPS APM criteria requires at least
one Eligible Clinician on a Participation List for the APM, while
currently all EPM and CJR participants are hospitals. Thus, the EPM and
CJR Participation Lists do not include Eligible Clinicians and,
therefore, a Track 2 EPM and the Track 2 CJR model are not MIPS APMs.
As a result, EPM or CJR collaborators, collaboration agents, and
downstream collaboration agents are not engaged with Track 2 EPM
participants or Track 2 CJR participant hospitals in a MIPS APM.
Therefore, we will not adopt a requirement in regulation for Track 2
EPM participants or Track 2 CJR participant hospitals to submit
clinician financial arrangements lists at this time.
We agree with commenters that we should continue to consider
whether there are opportunities for additional APMs, including episode
payment models, to become MIPS APMs. We will continue to consider the
balance in models between the most appropriate, streamlined model
design for the intended model participants to advance the goals of the
model and the requirements for models to be MIPS APMs or Advanced APMs
as we strive to create more opportunities for Eligible Clinicians to
participate in MIPS APMs and Advanced APMs.
Comment: Commenters urged CMS to consider reversing the proposed
Track 1 and Track 2 designations to represent an APM and Advanced APM,
respectively, or identifying an alternative naming convention as the
term ``tracks'' are already used in the Shared Savings Program.
Response: We appreciate the perspective of the commenters but
believe that our proposed designations of a Track 1 EPM as an Advanced
APM and a Track 2 EPM as a Non-Advanced APM under the EPMs are
straightforward and appropriate for the distinctions we make between
Advanced and Non-Advanced EPMs. The track designations for the EPMs are
relevant to the EPM participants in the specific track of the EPM and
the individuals and entities that have financial arrangements under the
EPMs. We never intend to refer solely to the term Track 1 or Track 2 in
the context of the EPMs but always in combination with the term EPM as
a Track 1 EPM or Track 2 EPM. Therefore, we do not believe that Track 1
EPMs or Track 2 EPMs will be confused with tracks in the Shared Savings
Program. We will be working closely with EPM participants and other
stakeholders during EPM implementation to explain the various
requirements of the EPMs in general and the tracks of the EPMs in
particular.
Comment: Additional proposals were submitted by commenters that
encouraged CMS to work further by creating additional tracks, including
a MIPS APM track and accommodating those that may wish to accept
financial risk sooner in order to qualify as an Advanced APM.
Commenters believe CMS should continue to develop pathways and provide
assistance to organizations who wish to develop or become participants
in Advanced APMs; and to expand beyond the current inpatient-based
episode payment model tracks to include not only a physician-focus but
also a focus that meaningfully incorporates additional roles and
activities, for example, specialty service providers, rehabilitation
therapy providers, BPCI early adopters, home health care, and
transitional care.
Response: We appreciate the suggestions of commenters. We respond
earlier in this section on requests for additional MIPs APMs and for
voluntary election of early increased downside risk to allow rural
hospitals, SCHs, MDHs, and RRCs with special stop-loss limits under the
EPMs to be in a Track 1 EPM at the same time as other EPM participants
without special stop-loss limits under the EPM. We will continue our
efforts to develop pathways and provide assistance to organizations who
wish to develop or become participants in Advanced APMs. We refer the
commenters to section III.A.3 of this final rule for additional
considerations for future EPMs.
Comment: Commenters expressed appreciation for the proposed
alignment resulting from use of the same definition of CEHRT across the
EPM and Quality Payment Program, and acknowledged that CMS' proposal to
permit those EPM participants who do not use CEHRT to be in a different
track of the EPM offers appropriate flexibility. A few commenters
requested that CMS consider using a process through the Medicare EHR
Incentive Program to gather the attestations from the hospitals.
Response: We appreciate the recognition from commenters of CMS'
efforts to utilize the flexibilities of the Quality Payment Program for
Eligible Clinicians to link quality to payments through meaningful
participation in an Advanced APM.
We also appreciate the suggestions by the commenters about existing
processes and information CMS might use to streamline CEHRT use
attestation for EPM participants in Track 1 EPMs. We reiterate that EPM
participants choose to attest to CEHRT use and submit a clinician
financial arrangements list beginning in performance year 3 and,
therefore, be a Track 1 EPM participant (or elect voluntary downside
risk in performance year 2, attest to CEHRT use, and submit a clinician
financial arrangements list, and therefore, be a Track 1 EPM
participant beginning in performance year 2), or choose not to attest
to CEHRT use and be a Track 2 EPM participant. We will consider the
feedback from commenters on CEHRT attestation methodologies as we
develop the operational information for EPM participants about EPM
processes and procedures. We further note that CMS and ONC also offer
continued support and guidance through educational resources to support
participating in and reporting CEHRT use to CMS models and programs,
such as the EHR Incentive Program. We will communicate closely with EPM
participants about the form and manner of attestation to CEHRT use for
Track 1 EPMs early in the process of EPM implementation.
Comment: Many commenters urged CMS to consider the significant
upfront investments in health IT infrastructure that providers must
make to participate and be successful in the Quality Payment Program
and EPMs or CJR model, given that, as one commenter stated, this
investment exists even in upside-only models. As a result, these
commenters recommended that CMS consider permitting EPM participants to
be Advanced APM Entities in performance year 1 and/or that entry into
Track 1 for EPM participants and CJR participant hospitals begin as
soon as possible. Other commenters pointed out the lack of resources/
support for Eligible Clinicians, such as therapists, to adopt EHRs. The
commenters believe that Eligible Clinicians participating in an
Advanced APM where the Advanced APM Entity is a hospital must also use
and attest to use of CEHRT, and further stated that such a requirement
would put these professionals at a significant disadvantage. To this
end, a few commenters requested that CMS clarify whether the CEHRT
requirement only applies to the hospitals that are EPM
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participants and whether Eligible Clinicians who have entered into
sharing arrangements as EPM collaborators will potentially meet the
requirements to attest to use of CEHRT for participating in an Advanced
APM under the Quality Payment Program.
Response: Like the commenters, we appreciate the important role
health IT may play in meeting the goals of Advanced APMs, including
Track 1 EPMs, to improve the quality and reduce the cost of care. As a
result of the Quality Payment Program final rule with comment period
(81 FR 28306), in order for an APM to be considered an Advanced APM,
the APM must either require that participating APM Entities bear risk
for monetary losses of a more than nominal amount under the APM or be a
Medical Home Model expanded under section 1115A(c) of the Act. As a
result of this final rule, a Track 1 CJR participant hospital will be
considered to be participating in an Advanced APM, and could qualify as
an Advanced APM Entity beginning in performance year 2 for episodes
ending on or after January 1, 2017, the time at which CJR participant
hospitals would begin to bear downside risk for excess actual CJR
episode spending above the quality-adjusted target price. Track 1 EPM
participants will be considered to be participating in an Advanced APM,
and could qualify as an Advanced APM Entity beginning in performance
year 2 for episodes ending on or after January 1, 2018, the time at
which EPM participants in performance year 2 would begin to bear
downside risk for excess actual episode spending above the quality-
adjusted target price.
The Advanced APM criteria established in the Quality Payment
Program final rule with comment period at Sec. 414.1415 (81 FR 77549)
require that for APMs in which hospitals are the APM Entities, such as
the EPMs, each hospital must use CEHRT to document and communicate
clinical care to their patients or other health care providers to meet
the CEHRT use requirement for Advanced APMs. Thus, there is no
requirement that Eligible Clinicians who would be included on an
Affiliated Practitioner List for Track 1 EPMs attest to CEHRT use and,
therefore, we will not develop CEHRT attestation processes for Eligible
Clinicians in Track 1 EPMs nor will we provide funds to support EHR
adoption. In addition, we encourage participants to consider utilizing
any shared savings obtained as part of the model to invest in health IT
infrastructure that can help EPM collaborators improve care
coordination for beneficiaries.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal to include in Sec. 512.120(a)
the CEHRT use and attestation for EPM participants, with modification
to specify that the policy applies for performance year 2 if the EPM
participant elects downside risk, and to use the term ``specified'' for
consistency with CEHRT attestation in other CMS programs.
For performance year 2 if the EPM participant elects downside risk
and for performance years 3 through 5, EPM participants choose either
of the following:
CEHRT use. EPM participants attest in a form and manner
specified by CMS to their use of CEHRT as defined in Sec. 414.1305 of
this chapter to document and communicate clinical care with patients
and other health professionals.
No CEHRT use. EPM participants do not attest in a form and
manner specified by CMS to their use of CEHRT as defined in Sec.
414.1305 of this chapter to document and communicate clinical care with
patients and other health professionals.
c. Clinician Financial Arrangements Lists Under the EPMs
In order for CMS to make determinations as to eligible clinicians
who could be considered QPs based on services furnished under the EPMs
(to the extent the models are determined to be Advanced APMs), we
require accurate information about eligible clinicians who enter into
financial arrangements under the Track 1 EPMs under which the
Affiliated Practitioners support the participants' cost or quality
goals as discussed in section III.I. of this final rule. We note that
eligible clinicians could be EPM collaborators engaged in sharing
arrangements with an EPM participant; PGP members who are collaboration
agents engaged in distribution arrangements with a PGP that is an EPM
collaborator; or PGP members who are downstream collaboration agents
engaged in downstream distribution arrangements with a PGP that is also
an ACO participant in an ACO that is an EPM collaborator. These terms
as they apply to individuals and entities with financial arrangements
under the EPMs are discussed in section III.I. of this final rule. A
list of physicians and nonphysician practitioners in one of these three
types of arrangements could be considered an Affiliated Practitioner
List of eligible clinicians who are affiliated with and support the
Advanced APM Entity in its participation in the Advanced APM as
proposed in the Quality Payment Program proposed rule. Therefore, this
list could be used to make determinations of who would be considered
for a QP determination based on services furnished under the EPMs (81
FR 28320).
Thus, we proposed that each EPM participant that chooses to meet
and attest to the CEHRT use requirement must submit to CMS a clinician
financial arrangements list in a form and manner specified by CMS on a
no more than quarterly basis. The list must include the following
information for the period of the EPM performance year specified by
CMS:
For each EPM collaborator who is a physician, nonphysician
practitioner, or provider of outpatient therapy services during the
period of the EPM performance year specified by CMS:
++ The name, tax identification number (TIN), and national provider
identifier (NPI) of the EPM collaborator.
++ The start date and, if applicable, end date, for the sharing
arrangement between the EPM participant and the EPM collaborator.
For each collaboration agent who is a physician or
nonphysician practitioner of a PGP that is an EPM collaborator during
the period of the EPM performance year specified by CMS:
++ The TIN of the PGP that is the EPM collaborator, and the name
and NPI of the physician or nonphysician practitioner.
++ The start date and, if applicable, end date, for the
distribution arrangement between the EPM collaborator that is a PGP and
the physician or nonphysician practitioner who is a PGP member.
For each downstream collaboration agent who is a physician
or nonphysician practitioner member of a PGP that is also an ACO
participant in an ACO that is an EPM collaborator during the period of
the EPM performance year specified by CMS:
++ The TIN of the PGP that is the ACO participant, and the name and
NPI of the physician or nonphysician practitioner.
++ The start date and, if applicable, end date, for the downstream
distribution arrangement between the collaboration agent that is both
PGP and an ACO participant and the physician or nonphysician
practitioner who is a PGP member.
If there are no individuals that meet the requirements to
be reported as EPM collaborators, collaboration agents, or downstream
collaboration agents, the EPM participant must attest in a form and
manner required by CMS that there
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are no individuals to report on the clinician financial arrangements
list.
As discussed in the Quality Payment program proposed rule, those
physicians or nonphysician practitioners who are included on the
Affiliated Practitioner List as of December 31 of a performance period
would be assessed to determine whether they qualify for APM Incentive
Payments (81 FR 28320). The Quality Payment Program final rule with
comment period (81 FR 77444) modified this process to identify eligible
clinicians on the Affiliated Practitioner List for QP determinations at
any one of three snapshots. The first snapshot will be on March 31 of
the QP Performance Period, the second snapshot will be on June 30 of
the QP Performance Period, and the third snapshot will be on August 31,
which will be the last day of the QP Performance Period.
We noted that while the required submission of this information
might create some additional administrative requirements for certain
EPM participants, we expected that EPM participants in a Track 1 EPM
could modify their contractual relationships with their EPM
collaborators and, correspondingly, require those EPM collaborators to
include similar requirements in their contracts with collaboration
agents and in the contracts of collaboration agents with downstream
collaboration agents.
The proposal for the submission of a clinician financial
arrangements list by EPM participants that meet and attest to the CEHRT
use requirement for the EPM was included in Sec. 512.120(b). We sought
comments on the proposal for submission of this information. We were
especially interested in comments about approaches to information
submission, including the periodicity and method of submission to CMS
that would minimize the reporting burden on EPM participants while
providing CMS with sufficient information about eligible clinicians in
order to facilitate QP determinations to the extent EPMs are considered
Advanced APMs.
The following is a summary of the comments received and our
responses.
Comment: While some commenters supported CMS' plans to recognize
Eligible Clinicians who participate in APMs from an Affiliated
Practitioner List, others raised concerns about the means to identify
Eligible Clinicians as Affiliated Practitioners of Advanced APMs. A few
commenters disagreed with the development of an Affiliated Practitioner
List from a clinician financial arrangements list. Some commenters
believe that to assume risk-taking threatens the financial viability of
most physician-led entities. Other commenters expressed concern that
the definition of such an agreement suggests that risk must be shifted
to the clinicians to achieve QP status. These commenters agreed that
the clinicians must support the cost or quality goals of the Advanced
APM, but do not believe that to be included on the Affiliated
Practitioner List the clinician must take risk. Other commenters
assumed that Eligible Clinicians must assume risk under the EPM to
qualify for QP incentive payment under the Quality Payment Program, and
suggested that CMS base the risk requirements on physician practice or
APM organization revenues. One commenter noted that not all physicians
bound contractually to the requirements of the EPMs would be captured
on clinician financial arrangements lists, as hospitals may have
agreements with their employed physicians that cascade the programmatic
requirements of the EPMs, but do not necessarily alter their underlying
compensation or include gainsharing/risk-sharing/internal cost savings
parameters. Instead, commenters offered alternatives to the submission
of clinician financial arrangements lists, including such proposals as
modeling the EPM along the lines of the Medical Home Model standard and
using claims data to identify and attribute Eligible Clinicians to
populate the EPM Affiliated Practitioner List for the purposes of the
Quality Payment Program.
Response: Under Track 1 EPMs, the Advanced APM Entity is always a
hospital, and no physicians are EPM participants. As we discussed in
the Quality Payment Program final rule with comment period (81 FR
77442), for Advanced APMs, such as episode payment models, in which
there are some Advanced APM Entities that include Eligible Clinicians
on a Participation List and other Advanced APM Entities that identify
Eligible Clinicians only on an Affiliated Practitioner List, we will
identify Eligible Clinicians for QP determination based on the
composition of the Advanced APM Entity: (1) For Advanced APM Entities
that include and identify Eligible Clinicians on a Participation List,
that Participation List will be used to define the Advanced APM Entity
group, regardless of whether or not there is also an Affiliated
Practitioner List or other list of Eligible Clinicians, and those
Eligible Clinicians will be assessed as a group; (2) for Advanced APM
Entities that do not include and identify Eligible Clinicians on a
Participation List and there is an Affiliated Practitioner List that
identifies Eligible Clinicians, that Affiliated Practitioner List will
be used to identify the Eligible Clinicians for purposes of QP
determinations, and those Eligible Clinicians will be assessed
individually. Track 1 EPMs fall into the second category because the
EPMs do not include and identify Eligible Clinicians on a Participation
List so, therefore, we will use an Affiliated Practitioner List for
Track 1 EPMs to identify Eligible Clinicians for purposes of QP
determinations.
In the Quality Payment Program final rule with comment period in
Sec. 414.1305 (81 FR 77537), an Affiliated Practitioner is defined as
an Eligible Clinician identified by a unique APM participant identifier
on a CMS-maintained list who has a contractual relationship with the
Advanced APM Entity for the purposes of supporting the Advanced APM
Entity's quality or cost goals under the Advanced APM. Furthermore, in
the Quality Payment Program final rule with comment period (81 FR
77440), we provided the example that an Affiliated Practitioner List
comprised of gainsharers under an APM might include Eligible Clinicians
whereas a Participation List may only include hospitals. We believe
this example applies to the Track 1 EPMs.
We believe that constructing the Affiliated Practitioner List from
the list of clinicians with financial arrangements submitted by each
EPM participant that chooses to use and attest to use of CEHRT allows
us to appropriately identify clinicians for the Affiliated Practitioner
List under the EPMs. All of these clinicians have contractual
relationships under the EPMs, and because the determination of the
amount of gainsharing payment, distribution payment, or downstream
distribution payment under their arrangement is required to be
substantially based on quality of care and the provision of EPM
activities (activities related to promoting accountability for the
quality, cost, and overall care for EPM beneficiaries, including
managing and coordinating care; encouraging investment in
infrastructure, enabling technologies, and redesigned care processes
for high quality and efficient service delivery; the provision of items
and services during an EPM episode in a manner that reduces costs and
improves quality; or carrying out any other obligation or duty under
the EPM), we believe that their contractual relationship supports the
cost and quality goals of the Track 1 EPM participant and, therefore,
that they meet the definition of Affiliated Practitioner.
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Regarding those commenters who were concerned that constructing the
Affiliated Practitioner List in this way would shift the financial risk
of the APM Entity (Track 1 EPM participant) to the clinician in order
for the clinician to be eligible for a QP determination, we want to
emphasize that distribution arrangements and downstream distribution
arrangements allow only distribution of payments that may be comprised
of hospital internal cost savings and/or reconciliation payments for
savings beyond the quality-adjusted target price under the EPMs,
without allowing the collaboration agent or downstream collaboration
agents to assume any downside risk. Sharing arrangements may include
the sharing of upside and downside risk with EPM collaborators, but we
note that in our experience with other bundled payment models, sharing
with individual physicians has generally been upside risk only. We
understand that the Quality Payment Program final rule with comment
period does not require that an Affiliated Practitioner take on upside
or downside risk to be eligible for a QP determination, while our
proposed methodology to identify Eligible Clinicians for the EPM
Affiliated Practitioner List requires those clinicians to have a
financial arrangement under the EPM. However, we based our proposal on
the most streamlined approach to identifying Eligible Clinicians under
the Track 1 EPM who meet the definition of Affiliated Practitioner to
build off policies that apply across the EPMs in general, in order to
limit any additional administrative burden on EPM participants for
Track 1 participation. Under the EPMs, the only contractual
relationships for which we specify requirements as part of the model
design for all participants and which ensure the Eligible Clinicians
meet the Affiliated Practitioner definition are financial arrangements.
Therefore, under our proposal for identifying Eligible Clinicians for
each EPM participant that chooses to use and attest to use of CEHRT we
would use the clinician financial arrangements list submitted to us to
construct the EPM Affiliated Practitioner List.
In terms of constructing the Affiliated Practitioner List from
claims data based on those clinicians furnishing services to EPM
beneficiaries, we would not be able to know if such physicians,
nonphysician practitioners, or therapists had a contractual
relationship with the EPM participant to support the EPM participant's
cost or quality goals under the Track 1 EPM (the requirement for
Affiliated Practitioners), so we are unable to adopt this suggestion by
the commenters. Moreover, we believe we can only know the information
about contractual relationships between an EPM participant and an
Eligible Clinician if the EPM participant reports this to us as we do
not otherwise require such reporting under the EPMs.
We understand that there are circumstances where an EPM participant
might want to enter into a contract with a clinician to support the
cost or quality goals of the EPM. At this point, EPM participants that
choose to use and attest to use of CEHRT may not report these
clinicians to us through the clinician financial arrangements list for
inclusion on the Affiliated Practitioner List because we made no
specific proposals about what such contractual relationships would
entail. As discussed previously in this section, MedPAC expressed
concern that the EPMs contemplate large, loosely connected groups of
clinicians who may have very little involvement with the beneficiaries
in EPMs and hence have little reason to change their practice patterns
or reduce inappropriate episodes. Thus, in order to identify the
circumstances in which Eligible Clinicians without financial
arrangements under a Track 1 EPM participant could meet the definition
of Affiliated Practitioner, we will further consider the scenarios
raised by the commenters and intend to propose an additional
methodology for EPM participants to identify other Eligible Clinicians
who may be included on the Affiliated Practitioner List in future
rulemaking. This additional methodology would be targeted for
implementation in performance year 3 when downside risk for all
participants under the EPMs applies.
We are finalizing our proposal to construct the EPM's Affiliated
Practitioner List from the clinician financial arrangements lists
submitted by those EPM participants that attest to CEHRT use.
Comment: Several commenters urged CMS to identify Eligible
Clinicians through a streamlined reporting process, and ensure that a
minimum burden is applied to EPM participants when providing lists. To
this end, the commenters proposed alterations to the proposed contents
of the clinician financial arrangements list, including the
recommendation that CMS require EPM participants or CJR participant
hospitals to submit an electronic form listing all collaborators,
collaboration agents, and downstream collaboration agents and their tax
identification numbers (TIN) on a yearly basis. Finally, some
commenters requested that CMS enable more frequent updates to the list.
Response: We appreciate the interest of the commenters in creating
the minimal necessary reporting burden on EPM participants and CJR
participant hospitals. For those EPM participants that choose to use
and attest to use of CEHRT and are required to submit a clinician
financial arrangements list, we agree with the commenters that the most
streamlined process that provides us with the timely, necessary
information is desirable. We proposed that the submission must occur on
a no more than quarterly basis and we continue to believe that this
timing is the most appropriate. It establishes the maximum required
submission burden on EPM participants of quarterly in view of the three
planned ``snapshots'' of the Affiliated Practitioner List each year (81
FR 77444) to capture timely new Affiliated Practitioners that were not
previously identified for the EPM participant, while allowing us the
flexibility to determine a lower reporting periodicity for EPM
participants whose list does not change during the EPM performance
year. We also note that while under our proposal we could not require
submission of the list more than quarterly, the submission timing
requirement does not preclude us from accepting more frequent than
quarterly voluntary updates to the list if EPM participants have more
frequent changes to their list of clinicians with financial
arrangements under the EPM.
We proposed that Eligible Clinicians on the clinician financial
arrangements list that we would use to construct an Affiliated
Practitioner List would be EPM collaborators who are physicians,
nonphysician practitioners, and providers of outpatient therapy
services engaged in sharing arrangements with an EPM participant; PGP
members who are physicians and nonphysician practitioners who are
collaboration agents engaged in distribution arrangements with a PGP
that is an EPM collaborator; and PGP members who are physicians and
nonphysician practitioners who are downstream collaboration agents
engaged in downstream distribution arrangements with a PGP that is also
an ACO participant in an ACO that is an EPM collaborator. To reflect
our final policies for financial arrangements discussed in section
III.I. of this final rule, and taking into consideration the issues
discussed later in this section, we are revising the categories of
individuals who qualify as Eligible Clinicians and clarifying the
information to be reported on the clinician financial arrangements list
in this final rule. It was our intention in
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the proposed rule and our policy in this final rule that the full
complement of physicians, nonphysician practitioners, and therapists
who have financial arrangements under the EPMs be reported on the EPM
participant's clinician financial arrangements list. We see no reason
to treat physicians, nonphysician practitioners, or therapists
differently for purposes of being considered Eligible Clinicians based
on their specific type of financial arrangement under the EPM as the
requirements for each type of contractual relationship are aligned with
the cost and quality goals of the EPM.
We proposed that providers of outpatient therapy services that are
EPM collaborators be reported on the clinician financial arrangements
list, although the term provider of outpatient therapy services also
encompassed entities that were not individual therapists and that,
therefore, could not be Eligible Clinicians. However, as discussed in
section III.I.3. of this final rule we are adopting the specific term
therapist in private practice for those individual therapists who are
EPM collaborators. Thus, we are refining the reporting of EPM
collaborators on the clinician financial arrangements list to include
physicians, nonphysician practitioners, and therapists in private
practice to focus on individual therapists in private practice, who may
be Eligible Clinicians under the provisions of the Quality Payment
Program final rule with comment period, rather than all providers of
outpatient therapy services.
In addition, our proposal did not identify as Eligible Clinicians
therapists who are collaboration agents and downstream collaboration
agents as members of PGPs or ACO providers/suppliers who are
physicians, nonphysician practitioners, or therapists who are
collaboration agents. While we did not propose that therapists who are
collaboration agents or downstream collaboration agents as members of
PGPs be reported on the clinician financial arrangements list, we did
propose that a therapist could be a PGP member and we note that
therapists can also be Eligible Clinicians under the provisions of the
Quality Payment Program final rule with comment period. We also did not
identify in our proposal that physicians, nonphysician practitioners,
and therapists who are collaboration agents and ACO providers/suppliers
in an ACO that is an EPM collaborator would be Eligible Clinicians on
the clinician financial arrangements list. This was an oversight as we
intended to include all collaboration agents who are physicians,
nonphysician practitioners, and therapists on the clinician financial
arrangements list, regardless of the entity that is their associated
EPM collaborator. Moreover, our proposal did not take into account the
provisions of this final rule that allow NPPGPs and TGPs to be EPM
collaborators or collaboration agents and, therefore, we did not
propose that the nonphysician practitioners and therapists who have
financial arrangements with these entities would also be Eligible
Clinicians on the clinician financial arrangements list. Therefore, in
this final rule we are clarifying that all physicians, nonphysician
practitioners, and therapists who are collaboration agents or
downstream collaboration agents are reported on the clinician financial
arrangements list, without regard to the type of entity that is the
associated party with which the collaboration agent or downstream
collaboration agent has his or her distribution arrangement or
downstream distribution arrangement. We note that we proposed to
require that physicians and nonphysician practitioners who are members
of a PGP that is an EPM collaborator or members of a PGP that is also
an ACO participant in an ACO that is an EPM collaborator and that have
a distribution arrangement or downstream distribution arrangement,
respectively, with the PGP be reported on the list. Therefore, we
believe there is only a small additional burden on EPM participants to
report on the list all collaboration agents or downstream collaboration
agents that are physicians, nonphysician practitioners, or therapists
with distribution arrangements or downstream distribution arrangements,
in order to ensure that the clinician financial arrangements list
reports all Eligible Clinicians with financial arrangements under the
EPM.
We proposed that the information to be reported on the clinician
financial arrangements list would include the name and NPI and, in some
cases the TIN, of the Eligible Clinician with the financial arrangement
under the EPM. We also proposed to collect the TIN of the PGP that is
an EPM collaborator or collaboration agent and with which the physician
or nonphysician practitioner reported on the list has a financial
relationship, which would have provided us with information for
purposes of monitoring and compliance on some of the entities related
to the contracts of those physicians or nonphysician practitioners
under the EPM. While we did not propose to similarly require
information be submitted on the ACO that would be an EPM collaborator
for those Eligible Clinicians that are collaboration agents or
downstream collaboration agents, in this final rule, we are clarifying
that the name and NPI of the entity (that is, the PGP, NPPGP, TGP, or
ACO) that is an EPM collaborator and the entity (that is, the PGP,
NPPGP, or TGP) that is a collaboration agent, if applicable, must also
be reported on the clinician financial arrangements list for each
Eligible Clinician who is a collaboration agent or downstream
collaboration agent. Thus, the final requirements provide us with
sufficient information to monitor the full series of related financial
relationships under the EPM that result in the reporting of an Eligible
Clinician on the clinician financial arrangements list. Because we do
not expect that EPM participants will enter into sharing arrangements
with many ACOs, due to the limited number of ACOs to which
beneficiaries are typically assigned in a given geographic area, we do
not believe that requiring the reporting of the name and TIN of the ACO
that is an EPM collaborator is a significant additional burden on the
EPM participant submitting the list to CMS.
In summary, based on the previous discussion, for purposes of
clarity and consistency we are streamlining the requirements for
reporting information on the clinician financial arrangements list. For
each physician, nonphysician practitioner, or therapist that is an EPM
collaborator, collaboration agent, or downstream collaboration agent,
we require the name, TIN, and NPI to be reported, in addition to the
start date and, if applicable, end date, for the individual's sharing
arrangement, distribution arrangement, or downstream distribution
arrangement. We further require for a collaboration agent that the name
and TIN of the EPM collaborator be reported and that for a downstream
collaboration agent the name and TIN of the EPM collaborator and the
name and TIN of the collaboration agent be reported.
We will be working closely with EPM participants on the format and
process for submission of clinician financial arrangements lists,
including the potential for electronic submission of the required
information, during the early phases of EPM implementation, seeking to
ensure that the format and process is as streamlined as possible for
EPM participants that choose to use and attest to use of CEHRT, while
meeting CMS' need to maintain an EPM Affiliated Practitioner List that
can be used to identify Eligible Clinicians for a QP determination.
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Final Decision: After consideration of the public comments
received, we are finalizing the proposal in Sec. 512.120(b) for EPM
participants that use and attest to use of CEHRT to submit to CMS a
clinician financial arrangements list on a no more than quarterly
basis, with modification to include on that list information on all
physicians, nonphysician practitioners, and therapists with financial
arrangements under the EPM and, if applicable, identifying information
for the related parties with sharing arrangements, distribution
arrangements, and downstream distribution arrangements under the EPM as
finalized in section III.I. of this final rule.
Each EPM participant that chooses CEHRT use must submit to CMS a
clinician financial arrangements list in a form and manner specified by
CMS on a no more than quarterly basis. The list must include the
following information on individuals and entities for the period of the
EPM performance year specified by CMS:
EPM collaborators. For each physician, nonphysician
practitioner, or therapist in private practice who is an EPM
collaborator during the period of the EPM performance year specified by
CMS:
++ The name, TIN, and NPI of the EPM collaborator.
++ The start date and, if applicable, end date, for the sharing
arrangement between the EPM participant and the EPM collaborator.
Collaboration agents. For each physician, nonphysician
practitioner, or therapist who is a collaboration agent during the
period of the EPM performance year specified by CMS:
++ The name and TIN of the EPM collaborator and the name, TIN, and
NPI of the collaboration agent.
++ The start date and, if applicable, end date, for the
distribution arrangement between the EPM collaborator and the
collaboration agent.
Downstream collaboration agents. For each physician,
nonphysician practitioner, or therapist who is a downstream
collaboration agent during the period of the EPM performance year
specified by CMS:
++ The name and TIN of the EPM collaborator, the name and TIN of
the collaboration agent and the name, TIN, and NPI of the downstream
collaboration agent.
++ The start date and, if applicable, end date, for the downstream
distribution arrangement between the collaboration agent and the
downstream collaboration agent
Attestation to no individuals. If there are no individuals
that meet the requirements to be reported, as specified in paragraphs
(b)(1) through (3) of this section, the EPM participant must attest in
a form and manner required by CMS that there are no individuals to
report on the clinician financial arrangements list.
d. Documentation Requirements
For each EPM participant that chooses to meet and attest to CEHRT
use, we proposed that the EPM participant must maintain documentation
of their attestation to CEHRT use and clinician financial arrangements
lists submitted to CMS. These documents would be necessary to assess
the completeness and accuracy of materials submitted by an EPM
participant in the Track 1 EPM and to facilitate monitoring and audits.
For the same reason, we further proposed that the EPM participant must
retain and provide access to the required documentation in accordance
with Sec. 512.110.
The proposal for documentation of attestation to CEHRT use and
clinician financial arrangements lists submitted to CMS was included in
Sec. 512.120(c). We sought comment on this proposal for required
documentation.
Final Decision: We did not receive comments pertaining to Sec.
512.120(c). Therefore, we are finalizing the proposal, without
modification, for EPM participant documentation of attestation to CEHRT
use and clinician financial arrangements lists submitted to CMS.
The following documentation requirements apply to EPM participants
choosing to use and attest to use of CEHRT.
Each EPM participant that chooses CEHRT use must maintain
documentation of their attestation to CEHRT use and clinician financial
arrangements lists.
The EPM participant must retain and provide access to the
required documentation in accordance with Sec. 512.110.
3. Future Directions for Episode Payment Models
a. Refinements to the BPCI Initiative Models
The BPCI initiative Models 2, 3, and 4 would not currently qualify
as Advanced APMs based on two of the Advanced APM criteria in the
Quality Payment Program (QPP) final rule with comment period (81 FR
77008), payment based on quality measures and CEHRT use. Specifically,
BPCI participants are not currently required to use CEHRT, and although
CMS examines the quality of episode care in the BPCI evaluation, BPCI
episode payments are not specifically tied to quality performance.
Instead, BPCI episode payments are based solely on episode spending
performance, although we expect that reductions in spending would
generally be linked to improved quality through reductions in hospital
readmissions and complications. However, building on the BPCI
initiative, the Innovation Center intends to implement new bundled
payment model for CY 2018 where the model(s) would be designed to meet
the criteria to be an Advanced APM.
The following is a summary of the comments received and our
responses.
Comment: A number of commenters expressed support for a new
voluntary bundled payment model in CY 2018. Specifically, commenters
expected any new design to include the ability of the BPCI Initiative
to qualify as meeting the requirements for an advanced APM under the
QPP. Commenters also requested that data be provided by CMS on a
monthly basis with quarterly reconciliation reports to allow
participants to meaningfully engage in reforms to the delivery of
health care. Consistent with the existing BPCI model, CMS was
encouraged by commenters to continue assigning precedence to self-
selected model participants over participants in assigned models.
Additional recommended features included financial stop-gain and stop-
loss limits and the incorporation of composite quality score similar to
that used in the CJR model. Other specific features included
recommendations for additional post-acute care bundles and the
exclusion of ACOs.
More broadly, CMS received several recommendations calling for
increased stakeholder input in the design, implementation, and
evaluation of new voluntary bundled payment models. Commenters
requested that hospitals currently participating in BPCI should be
allowed to test additional episodes, and new hospitals should be
allowed to enter the program. While ranging in degree, most commenters
highlighted a need for input from external clinical experts in addition
to consumers, patients, and purchasers as well as institutional
stakeholders such as QIOs. To better align with other available EHR
incentive payments, several commenters stated a need for future bundled
payment models to include CEHRT measures.
Response: We appreciate these considerations as we design a new
voluntary bundled payment model.
Comment: A few commenters suggested that since post-acute care
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providers are the predominant care provider for LEJR patients, post-
acute care should play a more prominent role in the BPCI initiative.
Response: CMS thanks the commenters for this suggestion.
Comment: One commenter recommended CMS use a consistent policy to
address overlap of all Medicare bundled payment initiatives and
population-based payment models. The commenter raised concerns with
respect to overlap of beneficiaries in the EPMs, CJR model, and BPCI
initiative, and suggested that, in a future BPCI initiative,
beneficiaries should be excluded from bundled payments unless a
collaborative agreement exists between an ACO and a hospital that is
not a participant in that ACO. The commenter also had concerns for the
extent to which Medicare beneficiaries benefit from allowing private
for-profit awardee conveners to absorb the risk for providers.
Therefore, the commenter recommended also that CMS exclude for-profit
risk-taking conveners which do not provide patient care.
Response: We acknowledge and appreciate all comments, and
specifically recognize the shared interest in improving Medicare for
its beneficiaries.
Comment: A few commenters requested that CMS take into
consideration several additional pricing flexibilities and regulatory
waivers for a new voluntary bundled payment model. Specifically,
commenters believed that reducing costs and increasing shared savings
could be difficult, therefore, participants should have the flexibility
in a new voluntary bundled payment model to modify practice or
utilization patterns by reducing length of stay or intensity of
services. Commenters stated that the next iteration of BPCI should
feature program elements such as caps on total losses that gradually
increase over time, variable discounts based on quality scoring, and
elimination of financial responsibility for payments above a threshold.
Other commenters proposed that CMS adopt a method of population risk
stratification, as this could provide incentive to providers by
reimbursing more for greater comorbidities. Finally, in setting the
bundled payment amounts, commenters recommended that CMS incorporate
clinical practice guidelines and appropriate use criteria to ensure
that patients are not receiving inadequate care. One commenter
suggested that CMS provide patient navigators to Medicare beneficiaries
receiving items or services paid under an EPM. Additionally, the
regulatory waivers requested included the home health homebound
requirement, the IRF 60 percent rule, the IRF 3-hour therapy intensity
rule, and the LTCH 25 day average length of stay restriction. One
commenter suggested that occupational therapy be recognized as a
``qualifying service'' under the Medicare home health care benefit and
occupational therapists could, in future APMs be permitted to open
`therapy only' cases if occupational therapy is in the physician's
order.
Response: We recognize commenters' requests for consideration of
additional flexibilities in care redesign efforts as part of a new
voluntary bundled payment model.
Final Decision: As we did not propose changes to the BPCI
initiative in the proposed rule, we do not have any changes to finalize
in this final rule.
b. Potential Future Condition-Specific Episode Payment Models
In the context of our proposal for the AMI and CABG models that
include beneficiaries with CAD who experience an acute event or a major
surgical procedure, we sought comment on model design features for
potential future condition-specific episode payment models that could
focus on an acute event or procedure or longer-term care management,
including other models for beneficiaries with CAD that may differ from
the design of the EPMs proposed in the proposed rule (81 FR 50794). We
believe such future models may have the potential to be Advanced APMs
that emphasize outpatient care and, like the proposed AMI and CABG
models, could incentivize the alignment of physicians and other
eligible professionals participating in the Advanced APM through
accountability for the costs and quality of care. Such condition-
specific episode payment models may provide for a transition from
hospital-led EPMs to physician-led accountability for episode quality
and costs, especially given the importance of care management over long
periods of time for beneficiaries with many chronic conditions.
We requested that commenters provide specific information regarding
all relevant issues for potential future condition-specific episode
payment models, including identifying beneficiaries for the model;
including services in the episode definition; beginning and ending
episodes; pricing episodes, including risk-adjustment; designating the
accountable entity for the quality and cost of the episode, including
the role of physician-led opportunities; sharing of responsibility for
quality and spending between primary care providers, specialty
physicians, and other health care professionals; incentivizing the
engagement of physicians and other providers and suppliers in episode
care; measuring quality and including quality performance and
improvement in the payment methodology; interfacing with other CMS
models and programs responsible for population health and costs, such
as ACOs and Primary Care Medical Homes (PCMHs); other considerations
specific to identifying future models as Advanced APMs; and any other
issues of importance for the design of such an EPM.
The following is a summary of the comments received and our
responses.
Comment: A few commenters requested that in future condition-
specific EPMs, CMS should consider episodes beginning before a
hospitalization, as one commenter believed that this earlier future EPM
episode trigger would engage more meaningful shared care planning.
Other commenters stated that future condition-specific EPMs should be
based on episodes that are not necessarily tied to a hospital stay. One
commenter noted that there is a great degree of variation in cardiac
care beyond the two proposed EPM episodes. For example, the commenter
noted regional differences in ambulatory and hospital care for heart
failure, which the commenter did not believe are explained by disease
severity and therefore the commenter suggested such additional cardiac
care may become a favorable population-based payment model. Several
commenters provided recommendations and perspectives on future
condition-specific episode payment models based on MS-DRGs, including
examples such as sepsis. However, other commenters suggested the
alternative to use the Episode Grouper for Medicare (EGM) for future
condition-specific EPMs. The framework for the EGM involves organizing
administrative claims data into episodes-of-care, or simply episodes,
which are sets of services provided to care for an illness or injury
during a defined period of time. One commenter stated that the EGM
organizes Medicare beneficiary total cost around two constructs--
episodes for specific conditions and episodes for specific treatments.
For condition-specific episodes, each episode would be defined by one
or more diagnosis codes, however, treatment episodes would be defined
by a combination of procedure and diagnosis codes. A few commenters
provided specific diagnoses that could be attributable to organized
future EPMs, including but not limited to gastroesophageal reflux
disease and
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obesity. Another commenter disagreed, stating it is inappropriate to
expand the current EPM approach to future treatment of chronic
conditions because, the commenter suggested, a bigger opportunity for
improving quality and achieving savings is avoiding unnecessary
episodes and events. In turn, the costs of treatment episodes could be
packaged into the costs of managing underlying condition episodes.
Commenters stated further that the EGM should also examine utilization
patterns, perform comparative analyses for similar conditions, and
identify care-improvement opportunities. As such, commenters suggested
that the EGM would be better suited to pricing and resource allocation
while identifying chronic conditions.
Response: We thank the commenters for their suggestion.
Comment: Another commenter, referencing the Program of All-
Inclusive Care for the Elderly (PACE), recommended that CMS consider a
comprehensive episode payment model for services for medical care that
could be tied with private payment, enrollment in available community
services, or an arrangement with Medicaid. Beneficiaries requiring
daily help or supervision would serve as a qualifying condition, which
could extend for varying durations.
Response: We appreciate the commenter's support for PACE and will
work internally to incorporate lessons learned from existing programs
in the proposal of future condition-specific EPMs.
Comment: Highlighting the efforts of national medical specialty
societies, several commenters provided several condition-specific EPMs
which may be successful in reducing emergency department visits,
hospital admissions, and excessive testing. Specifically, several
commenters gave such examples as coronary artery disease, headache,
epilepsy, asthma, opioid use disorder, diabetes, and specialty medical
home. Of note, commenters stated that CMS should give additional
consideration to defined episode triggers. For example, some commenters
suggested that each new episode should be accompanied by time criteria
and have a unique but expected time course. These efforts, commenters
suggested, might further result in disease prevention, reduced
exacerbations, and improved care.
Response: We appreciate commenters' eagerness to participate in
this dialogue and to be a part of transforming care.
Comment: Commenters believed that CMS should view organized
provider models as qualifying for condition-specific EPMs. Other
commenters suggested that CMS simply include more types of
participants, including examples such as ACOs and PCMHs. Still, others
commented that participation in future condition-specific EPMs be
limited to those organizations that are fully committed to coordinated
care planning, shared decision-making, comparative quality information,
chronic disease management, transparent payments and care transition
support. As an alternative approach to considering future condition-
specific EPMs, MedPAC suggested that CMS consider allowing hospitals to
share savings with physicians as a way to focus doctors on reducing the
cost of the inpatient stay.
Response: We acknowledge and appreciate the suggestion to
incorporate more participant types in future condition-specific EPMs.
Comment: Additionally, MedPAC recommended that for conditions that
are not promising for bundled payments, CMS could focus on an array of
other strategies to support providers in lowering costs while improving
patient outcomes. For example, the Medicare spending per beneficiary
(MSPB) measure in the hospital value-based purchasing (VBP) program
encourages lower spending and improved care coordination. Alteration of
the ``weight'' of the MSPB could be increased to further incentivize
hospitals to reduce spending. Furthermore, MedPAC noted that the
hospital readmission policy already encourages hospitals to avoid
readmissions for AMIs and CABGs. To increase the pressure to reduce
readmissions, it was suggested that CMS move forward with readmission
policies in all sectors to increase the penalties for providers with
high risk- adjusted potentially avoidable readmission rates.
Response: We appreciate any recommendations MedPAC can provide and
will continue to collaborate with stakeholders to develop additional
means to improve patient outcome measures. Furthermore, we will work
internally to find additional alignment between Innovation Center
programs and Medicare payment policies.
Comment: One commenter recommended consideration of an episode that
should address behavioral health integration with primary care. The
commenter suggested that guidelines which embed behavioral health
measurements into any care setting would equip providers with
quantification necessary to impact both physical and mental health of
patients.
Response: We appreciate the commenter's proposal. We appreciate the
many comments received regarding the request for comment and while we
did not propose any changes to this section of the final rule, we
intend to continually seek to connect those interested to further
information on consideration of future condition-specific EPMs that
would result in improvement in care for Medicare beneficiaries.
c. Potential Future Event-Based Episode Payment Models for Procedures
and Medical Conditions
Given the proposed EPM methodology discussed in section III.C.4.a.
of this final rule for the three models that would begin the episodes
with initial hospitalizations, the proposed AMI, CABG, and SHFFT
episodes are similar to the LEJR episodes in the CJR model because they
reflect clinical conditions for which care is almost always begun
during an inpatient hospitalization, either on an emergency or elective
basis. In addition, the clinical conditions represented by these EPM
episodes generally result in straightforward assignment to MS-DRGs at
discharge that are specific to clinical conditions included in the
episodes. This contrasts with procedure-related clinical conditions for
which the site-of-service can be inpatient or outpatient (for example,
elective PCI for non-AMI beneficiaries) or hospitalization for medical
conditions for which the ultimate MS-DRG assigned is less clear at the
beginning of an episode (for example, hospitalization for respiratory
symptoms which may lead to discharge from heart failure, pneumonia, or
other MS-DRGs based on reporting of ICD-CM diagnosis codes on hospital
claims).
To address the issues related to the development of future episode
payment models for a broader range of clinical conditions, we sought
comment on model design features that would be important for episode
payment models targeting procedures that may be performed in both the
inpatient and outpatient setting, as well as models focused on
hospitalization for acute medical conditions which may overlap or
interact (for example, sepsis related to pneumonia or acute kidney
injury related to congestive heart failure exacerbation). In
particular, episode payment models must clearly define the beginning of
the episode as well as set an episode price that is appropriate for
beneficiaries included in the episode, which has commonly been based on
historical spending for such beneficiaries in both existing CMS models
and the three proposed EPMs. These parameters pose specific challenges
as the variety of clinical
[[Page 218]]
conditions targeted for episode payments expands beyond lower extremity
orthopedic procedures and acute cardiac conditions, and we expect that
such potential future models would need to be designed differently than
the CJR model or the EPMs in this rulemaking.
For example, because procedures such as PCI for non-AMI
beneficiaries or cardioverter defibrillator implantations can occur in
the inpatient or outpatient setting, an episode payment model would
need to include beneficiaries receiving such procedures at all sites-
of-service so as to not influence decisions on where procedures are
performed based on payment-related rather than clinical considerations.
Episode payment models that begin with the same procedure performed in
the inpatient or outpatient setting would require methodological
development beyond the approaches that have been used thus far in CMS'
other EPMs that rely upon the MS-DRG for a hospitalization to begin an
episode and identify historical episodes for setting episode prices.
Such models that involve episode payment for procedures furnished in
the inpatient or outpatient setting may allow for significant
physician-led opportunities that would allow the models to be
identified as Advanced APMs. We sought comment on how these types of
procedures could be included in future episode payment models,
including identifying the accountable entity, and the role of
physician-led opportunities; defining the episode beginning and end;
setting episode prices; applying risk-adjustment to account for
differences in expected episode spending for a heterogeneous population
of beneficiaries; and any other issues of importance for the design of
such an episode payment model.
We also sought comment on potential future episode payment models
that would include care for medical conditions that result in the
serious health event of an inpatient hospitalization, which often
represents, regardless of the specific reason for the hospitalization,
a common pathway that includes failure of outpatient care management
and care coordination for beneficiaries with chronic conditions. While
we include beneficiaries who solely receive medical treatment in the
proposed AMI model, we note that beneficiaries with AMI are almost
always hospitalized and their MS-DRGs at discharge are generally
predictable and consistent based on their AMI diagnoses. This is not
the case for a number of medical conditions for which grouping by MS-
DRGs is more complicated or less consistent. Many non-procedural
hospitalizations of Medicare beneficiaries are ultimately categorized
based on the principal ICD-CM diagnosis code reported on a claim, which
in turn is mapped to a Major Diagnostic Category (MDC) based on the
involved organ system, which then leads to the assignment of any of
various specific MS-DRGs based on the medical groups in the MDC. For
example, the medical groups for the Respiratory System MDC are
pulmonary embolism, infections, neoplasms, chest trauma, pleural
effusion, pulmonary edema and respiratory failure, chronic obstructive
pulmonary disease, simple pneumonia, RSV pneumonia and whooping cough,
interstitial lung disease, pneumothorax, bronchitis and asthma,
respiratory symptoms and other respiratory diagnoses.\36\ Unlike a
beneficiary who undergoes a surgical procedure or who is hospitalized
for a specific medical condition such as AMI, the ultimate MS-DRG at
discharge assigned to a beneficiary hospitalized for diagnosis and
management of respiratory symptoms may not be clear during the
hospitalization itself, or even afterward, until the inpatient claim is
submitted and paid by Medicare. This makes it challenging for providers
to engage in care delivery redesign targeted to a specific patient
population identified by MS-DRG. Additionally, it is possible that
beneficiaries hospitalized for certain medical conditions also may
follow common clinical pathways before and after discharge for which
similar care redesign strategies could be developed and used despite
those beneficiaries' assignments to different MS-DRGs for their anchor
hospitalizations. Thus, we believe that hospitalization for most
medical conditions would require special consideration in the
development of potential future episode payment models that goes beyond
CMS's current approach of relying upon the MS-DRG for the anchor
hospitalization to begin an episode and identify historical episodes
for setting episode prices. We sought comment on design features needed
to address these considerations, including defining the beginning and
end of episodes; setting episode prices, including risk-adjustment,
that would support the provision of appropriate and coordinated care
for beneficiaries following hospital discharge for a period of time
during the episode; and any other issues of importance for the design
of such an episode payment model.
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\36\ Medical Severity Diagnosis Related Groups (MS-DRGs):
Definitions Manual. Version 33.0A. 3M Health Information Systems.
(October 1, 2015).
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The following is a summary of the comments received and our
responses.
Comment: Many commenters expressed support for the continued
commitment of the Agency to testing episode-based payment models under
a range of settings. One commenter suggested that CMS generally
consider both clinical and economic expertise as well as include large
databases as part of the development of future event-based EPM. While
recommendations included both specific surgical procedures, such as PCI
or spine surgery, chronic conditions, such as diabetes, and discrete
events including colonoscopy and an arm arthroplasty, several
commenters submitted more general suggestions that CMS take an
expansive approach in general for the consideration of future models
and not limit alternative payment models to episode payment approaches.
When considering future models to qualify as Advanced APMs, one
commenter suggested that CMS count capitated MA relationships in
MACRA's APM threshold calculation.
Some commenters preferred an emphasis on future EPMs that consider
the role of preventative efforts. For example, one commenter suggested
that conditions such as osteoporosis could include efforts to improve
bone health and functional level to achieve meaningful reduction in
falls and subsequent fracture. The commenter followed that concerns
such as fracture prevention be included in future models. To this end,
one commenter stated that CMS should take a ``bottom-up approach'' that
encourages providers to develop alternative payment models.
Response: We thank the commenters for their remarks, and will
continue to apply the bottom-up approach to improving the coordination
among providers in future EPMs.
Comment: Some commenters expressed concern about the continuation
of hospital-based models and recommended that future expansions should
include more types of participants, including physicians, and
participation should be voluntary. Physicians, one commenter suggested,
are best suited to ensure efficient utilization of resources while
preserving patient quality by virtue of their direct relationship with
the patient during an acute episode. One commenter suggested expansion
of physician-focused payment models beyond the Focused Payment Model
Technical Advisory Committee (PTAC). In a parallel thought process,
many other commenters expressed a desire for CMS to consider post-acute
care bundles, ACO based models, and shared
[[Page 219]]
accountability payment models for Inpatient Rehabilitation Facilities
(IRFs). One commenter strongly recommended CMS to allow manufacturers
to enter into voluntary agreements with CMS to link payment to
outcomes. One such outcome proposed by the commenter was the long-term
revision rates for total joint arthroplasty (TJA). Any shared savings
relative to the average rate of revision among Medicare patients, the
commenter suggested, could be shared between implanting surgeons,
hospitals and medical device manufacturers. Commenters stated that
these additional types of participants could provide a means to ensure
efficient utilization within a particular market. In addition, another
commenter noted that procedures performed in ambulatory surgical
centers may be better situated to serve as the financially accountable
entity in order to optimize care coordination to better achieve the
goals envisioned by episode-based payment models.
Response: We thank the commenters for their commitment to working
with CMS in developing future episode payment models.
Comment: Commenters commonly recommended that future bundles be
sensitive to considering risk adjustment, appropriate use criteria,
patient expectations, stage of disease progression, treatment options,
and appropriate quality measures regardless of setting. Commenters also
recommended that future measures in future condition-specific payment
models should be more directly related to the condition of the
beneficiaries within the EPM. To this end, one commenter recommended
that CMS include measures of patient engagement and shared care
planning. Another commenter suggested that those who participate in
geriatric fracture programs and/or obtain CORE Certification, be
incentivized to continue such progress. Even as CMS proposed to exclude
IPPS new technology add-on payments and OPPS transitional pass-through
payments for medical technologies from EPM episodes, one commenter
requested that future EPM episodes include additional innovative
technologies to qualify for a payment adjustment similar to the
Medicare New-Technology add-on payment.
Many commenters stressed the importance of shared decision-making
in the development of future models. One commenter, for example noted
the Clinical Practice Improvement Activities Category of the MIPS could
be an important first step to greater shared decision-making across
healthcare delivery and recommended CMS look to research conducted by
PCORI and others for future direction. Specifically, one commenter also
noted that shared decision-making and patient engagement tools could be
especially informative in situations not triggered by an acute care
hospitalization. Several other commenters further strongly encouraged
the participation of hospitals, physicians, patients, and other
stakeholders in the development, implementation, and testing of future
models. Additionally, in future EPM models, a few comments directed CMS
to consider directly extending the risk to the other providers,
including clinicians as physicians shape the spending during the
hospital stay and the selection of the initial post-acute care provider
but are not required to be at risk for the 90-day episode spending.
Similarly, some commenters noted that post-acute care providers can
influence how much spending for post-acute care services is used and
the rate of hospital readmissions but are not directly at risk for the
90-day episode spending. Therefore, these commenters suggested such
changes to future EPMs would ensure that the financial incentives of
the key actors shaping care are aligned.
In addition to model design, one commenter recommended that QIOs
serve in a technical assistance role for model participants to include
data analyses, convening providers in the area, structuring
implementation of improvement activities, and monitoring tests of
improvement.
Response: We thank the commenters for these suggestions and will
consider the recommendations as we consider future event-based
procedures and medical conditions to include in future rulemaking.
Comment: One commenter pointed to the Continuing Care Hospital
model, and suggested CMS pilot future event-based episode payment
models for procedures and medical conditions. The commenter stated that
the CCH would allow predictable and reduced costs to the Medicare
program.
Response: We thank the commenter for the reference.
Comment: One commenter suggested the implementation of an
evaluation EPM, whereby the episode initiates when a beneficiary enters
an inpatient setting with a set of symptoms that may be difficult to
attribute to one or more MS-DRGs. Such an evaluation EPM, stated the
commenter, would need to be limited to a specific set of symptoms, such
as the example CMS provided regarding respiratory symptoms.
Response: We thank the commenter for this specific suggestion.
Comment: One commenter recommended CMS to exclude other potentially
high cost drivers, such as psychiatric readmissions and high cost IV
therapy, from future EPM bundles.
Response: We acknowledge this suggestion and will consider if it is
applicable to specific future EPMs.
Comment: One commenter noted other considerations specific to
identifying future models, specifically that CMS update the claims
adjudication system and develop contracting tools. The commenter
suggested that such changes would encourage participant providers to
improve their care pathways and care coordination.
Response: We acknowledge these additional considerations and re-
affirm our commitment to continuously engage stakeholders as we
establish and operationalize future policies.
Comment: A few commenters requested a meeting with CMS to discuss
the specifics of a future innovation model.
Response: We appreciate the interest in meeting with CMS to discuss
future models. Commenters should note that ideas can also be submitted
through https://innovation.cms.gov/Share-Your-Ideas/Submit/index.html.
Final Decision: After seeking comments on future directions for
episode payment models, we thank the public for these comments and will
evaluate the suggestions for future consideration.
d. Health Information Technology Readiness for Potential Future Episode
Payment Models
We are particularly interested in issues related to readiness of
providers and suppliers that are not hospitals to take on financial
responsibility for episode cost and quality in potential future episode
payment models. We have some experience in BPCI Models 2 and 3 with
non-hospital providers and suppliers, specifically post-acute care
providers and physician group practices (PGPs), who assume financial
responsibility for the cost of episode care. In BPCI Model 2, PGPs may
directly bear financial responsibility for episode cost for up to 48
clinical conditions for the anchor inpatient admission and up to 90
days post-hospital discharge. In BPCI Model 3, PGPs and post-acute care
providers, including skilled nursing facilities, home health agencies,
inpatient rehabilitation facilities, and long-term care hospitals, may
directly bear financial responsibility for episode cost for up to 48
clinical conditions for a duration that extends up to 90 days
[[Page 220]]
following initiation of post-acute care following discharge from an
inpatient hospitalization.
Under these circumstances, PGPs and post-acute care providers
typically need to use health IT to assist them in effectively
coordinating the care of BPCI beneficiaries across settings throughout
the episodes. The risk-bearing entities participating in BPCI have
expressed readiness to take on financial responsibility for episode
cost, and they commonly rely upon health IT for assistance in managing
the care for BPCI beneficiaries across settings for episodes that
extend for a substantial period of time. However, a recent national
survey of IT in nursing homes showed common use of IT for
administrative activities but less use for clinical care.\37\
Anecdotally, stakeholders have told us that accountable non-hospital
providers and suppliers, especially those that are not integrated with
health systems, may have less well-developed tools for following
patients throughout episodes, potentially resulting in greater
challenges in reducing the cost and improving the quality of episode
care under the BPCI models. Therefore, we understand that limitations
in the availability of health IT that can be used in beneficiary
management across care settings may pose a significant barrier to the
readiness of non-hospital providers and suppliers to assume financial
responsibility for episodes in potential future episode payment models.
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\37\ Alexander, Gregory L. ``An Analysis of Nursing Home Quality
Measures and Staffing.'' Quality management in health care 17.3
(2008): 242-251. PMC. Web. 16 July 2016.
---------------------------------------------------------------------------
In the CJR model, acute care hospitals are financially responsible
for cost and quality during LEJR episodes-of-care. CJR model
participant hospitals may form partnerships with post-acute care
providers such as skilled nursing facilities and home health agencies,
as well as physicians and PGPs, to share financial risk and collaborate
on care redesign strategies, as in BPCI. Although hospitals are the
financially responsible entities under the CJR model, we recognize that
partnerships with post-acute care providers could be a crucial driver
of episode spending and quality, given that many beneficiaries in the
CJR model receive post-acute care services after discharge from the
hospital. We also recognize that tools such as health IT may be
critical for certain care management and quality strategies targeted
toward the goal of lower cost and higher quality episode care.
Limitations in the availability of health IT may pose a barrier to
effective post-acute care provider collaboration and sharing of
financial risk in episode payment models even when hospitals are the
financially responsible entities under such models, such as the CJR
model and the three new EPMs in this rule.
We recognize that there is wide variation in the readiness of other
providers and suppliers to bear financial responsibility for episodes,
either directly or indirectly through sharing arrangements with the
directly responsible entities where those arrangements may include
upside and downside risk. For instance, adoption of health IT among
providers in the post-acute care market, such as skilled nursing
facilities, continues to lag behind hospitals and providers of
ambulatory care services. In addition to facing significant resource
constraints, post-acute care providers were not included as an eligible
provider type under the Medicare and Medicaid Electronic Health Record
(EHR) Incentive Programs. The recent extension of Medicaid 90/10
funding offers new opportunities for states to include post-acute care
providers in projects focused on infrastructure development, but will
not address the cost of health IT adoption among post-acute care
providers.\38\
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\38\ https://www.medicaid.gov/federal-policy-guidance/downloads/SMD16003.pdf.
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To ensure that post-acute care providers and other types of
providers and suppliers can succeed under future episode payment
models, either as the directly financially responsible entity or as
collaborators with other directly financially responsible entities, we
are interested in opportunities to increase provider readiness as part
of the design of potential future episode payment models and the
potential refinement of current episode payment models. Specifically,
we would like to explore: Incentives to encourage post-acute care
providers, as well as other providers and suppliers that furnish
services to episode payment model beneficiaries, to make necessary
investments in health IT infrastructure; payment mechanisms that could
leverage savings achieved under episode payment models to contribute to
these investments; and any other strategies to enhance the adoption,
implementation, and upgrading of certified health IT. We sought comment
on these ideas, as well as the following questions:
What are key challenges associated with the inclusion of
post-acute care providers as the financially responsible entity or as
collaborators with other financially responsible entities in episode
payment models today?
What would be a sufficient financial incentive or bonus to
enhance the adoption, implementation, and upgrading of certified health
IT in post-acute care settings?
How else can episode payment models encourage the use of
certified health IT and information sharing among providers and
suppliers caring for episode payment model beneficiaries to improve
care coordination and patient outcomes?
Within the existing CJR model, are there additional
opportunities to encourage investment in adoption, implementation, and
upgrading of certified health IT among post-acute care providers to
support improvements in care coordination and patient outcomes? What
CJR model refinements could enable direct investments to support these
improvements, particularly among post-acute care providers who are
unaffiliated with CJR model participant hospitals but who provide
services to CJR model beneficiaries, including post-acute care
providers who may enter into financial arrangements with CJR model
participant hospitals as CJR collaborators?
The following is a summary of the comments received and our
responses.
Comment: Commenters recognized the importance that health IT plays
in the modern health care landscape, and overall supported the
implementation of a more robust health IT system, as such a system may
improve the ability to convey quick, accurate information from acute
care hospitals related to the discharge MS-DRG and identification of
patients who are under a bundled payment program. Many commenters
expressed a need for future episode payment models to align with EHR
incentive payments, and several commenters expressed concern that post-
acute care providers were largely disadvantaged for health IT readiness
relative to their inpatient counterparts. For example, commenters
stated that post-acute care providers and nonphysician clinicians were
marginalized by the Medicare and Medicaid EHR Incentive Programs. Some
commenters believe this population represents a significant portion of
the health care provider community without the technical and financial
support necessary to adopt and implement EHRs in a meaningful way. As
many of the measures used under meaningful use, such as e-prescribing,
are not applicable to nonphysician practitioners, commenters suggested
these and other clinicians have not had the benefit of experience with
EHRs at the same rate as their peers who work
[[Page 221]]
in hospitals. As a result, one commenter noted that small practices who
may face financial responsibility, such as physical therapists, would
face considerable challenges implementing health IT systems in their
practices.
Several commenters recommended that CMS to consider all possible
approaches to address this specific concern. One commenter, for
example, recommended an approach similar to the ACO Investment Model
program whereby participants could receive supplemental payments to
offset their upfront investment. Other commenters preferred not to
provide specific approaches as the sufficiency of financial incentives
or bonus payments may differ for example among Skilled Nursing
Facilities (SNFs), Home Health Agencies (HHAs), and institutional or
hospital-based post-acute care providers, but highlighted the need for
CMS to otherwise incentivize health IT adopters within future models.
To effectively implement any such expansion, one commenter further
stressed the need for health IT interoperability to be considered,
while another commenter stressed instead that CMS should specifically
cite the availability of the safe harbors of the Stark and Physician
Self-Referral rules, through which health care organizations could
choose to assist post-acute, or other providers, in making available
EHRs meeting certain requirements in any potential approach. One
commenter recommended that CMS continue to engage the long-term and
post-acute care community to explore in more detail potential
strategies to help overcome challenges providers face, such as the high
costs of participating in health information exchange or the
operational investment of an EHR system. Other comments on ways to
incentivize health IT investment by post-acute care providers included:
quicker or premium reimbursement for health IT adoption or upgrade,
returning savings to post-acute care providers to offset health IT
costs and incentive grants for training staff in health IT.
Response: We will consider these and other possible approaches to
address the concerns and challenges associated with implementing health
IT systems.
Final Decision: After consideration of the public comments
received, we believe we have a better understanding of the issues
related to readiness of providers and suppliers that are not hospitals
to take achieve interoperability through CEHRT in potential future
episode payment models.
B. Definition of the Episode Initiator and Selected Geographic Areas
1. Background
The new EPMs will complement the current CJR model and continue
efforts to move Medicare towards paying providers based on quality and
value. As discussed during rulemaking for the CJR model and in the EPMs
proposed rule, CMS is interested in testing and evaluating the impact
of an episode payment approach for a broad range of episodes in a
variety of other circumstances. In addition to including hospitals that
have not chosen to voluntarily participate in earlier models, we also
are interested in expanding the range of episodes included beyond
elective surgical procedures such that the impact on a broader range of
beneficiaries, hospitals, and circumstances may be tested. We also are
interested in evaluating the impact on hospitals when an increasing
percentage of care to Medicare beneficiaries is paid for through
alternative payment models.
As with CJR, we proposed in Sec. 512.105(c) that the hospital be
the accountable financial entity and that these episode payment models
be implemented in all IPPS hospitals in the geographic areas selected,
subject to exclusions as specified in Sec. Sec. 512.230 and 512.240 of
the proposed rule. While these are considered new episode payment
models and do not reflect an expansion or extension of any previous
models, they do intentionally build significantly upon the work of BPCI
and, most significantly, the framework established for CJR under 42 CFR
part 510 published on November 24, 2015 (80 FR 73274). Given the
extensive consideration given to many of these issues during the CJR
model planning and rulemaking periods, we believe this is important as
we seek to build a model that is scalable across all providers and
episode types. We also seek to limit the burden for hospitals and other
providers that may be participating across multiple episode types.
Therefore, to the extent applicable and appropriate, we have sought
consistency with rules established for the CJR model. We sought comment
on those areas where alternative options were proposed or should be
considered that would not add additional operational burden or
complexity. A summary of comments received and CMS' response to those
comments are included in the following sections.
2. Definition of Episode Initiator
Under the proposed EPMs, consistent with our episode initiator
definition under the CJR model, we proposed that episodes would begin
with the admission to an IPPS acute-care hospital that triggers an AMI,
CABG or SHFFT episode as specified in section III.C.4.a. of the
proposed rule (81 FR 50834). As with the CJR model, we proposed that
hospitals would be the only episode initiators in these episode payment
models. For purposes of these episodes payment models. The term
``hospital'' means a hospital as defined in section 1886(d)(1)(B) of
the Act. This statutory definition of hospital includes only acute care
hospitals paid under the IPPS. Under this proposal, all acute care
hospitals in Maryland would be excluded and payments to Maryland
hospitals would be excluded in the regional pricing calculations as
described in section III.D.4. of the proposed rule (81 FR 50847). This
is the same policy that is being followed with the CJR model. In
addition, we also proposed to exclude other all-payer state models
which may be implemented in the future. We welcomed comments on this
proposal and sought comment on potential approaches for including
Maryland acute-care hospitals or, potentially, other hospitals in
future all-payer state models in these episode payment models.
As implemented with the CJR model, we proposed to designate IPPS
hospitals as the episode initiators to ensure that all services covered
under FFS Medicare and furnished by EPM participant hospitals in
selected geographic areas to beneficiaries who do not meet the
exclusion criteria specified in section III.C.4. of the proposed rule
(81 FR 50834) are included. In addition, the episodes must not be BPCI
episodes that we are proposing to exclude as outlined in this section
and in section III.C.4. of the proposed rule. We believe that utilizing
the hospital admission as the episode initiator is a straightforward
approach for these models because patients covered under these DRGs and
diagnoses require hospital admission for these services, whether
provided on an emergent or planned basis. Under these new models
covering medical admissions and services that are not necessarily
elective, as stated in the proposed rule, we will be able to expand our
testing of a more generalized bundled payment model. Finally, as
described in section III.B.4. of the proposed rule (81 FR 50815) our
proposed geographic area selection approach relied upon our definition
of hospitals as the entities that initiate episodes.
[[Page 222]]
The following is a summary of the comments received on our proposed
episode definition and our responses.
Comment: We received many comments supporting our proposal to
initiate these EPM episodes of care with the inpatient hospital
admission. However, we also received multiple comments noting the
important role that physicians play in managing patient care throughout
the episode period including after discharge from the hospital. These
same commenters expressed support for more physician based payment
models so that physicians can have a more substantial role in managing
episodes.
Response: We appreciate the support commenters expressed for
initiating the EPM episodes with the inpatient hospital admission.
While we acknowledge and understand that inpatient initiated episodes
represent only one of many potential models for improving the quality
of care while restraining the growth in costs, we continue to believe
that the appropriate initiating point for the episodes in these EPMs is
the inpatient admission. Hospitals play a central role in coordinating
episode-related care and ensuring smooth transitions for beneficiaries
undergoing services related to these episodes and a large portion of a
beneficiary's recovery trajectory from an AMI or CABG or SHFFT begins
during the hospital stay which is why we are finalizing the inpatient
admission as the initiating event in the episode definition. We also
note that CMS has supported and is supporting other voluntary
demonstrations and models that focus on providing financial support for
care coordination services as recommended by these commenters. In
addition, in recent years, the range of services eligible for payment
under the Medicare physician fee schedule has expanded to include care
transition and chronic care management codes. For further discussion of
future models, we refer the reader to section III.A.3. of this final
rule, ``Future Directions for Episode Payment Models.''
We did not receive any comments related to our exclusion of
Maryland nor on the potential inclusion or exclusion of future all-
payer state models. Therefore we are finalizing our proposal to exclude
Maryland providers from this model.
Subsequent to the publication of this final rule CMS announced on
October 26, 2016 the implementation of the Vermont All Payer ACO Model
which will begin on January 1, 2017. Since this new Vermont model is an
all payer model and since we proposed to exclude all of the all payer
state models from the EPM we are also finalizing the exclusion of
Vermont providers from selection for participation in the EPMs. We note
that currently none of the MSAs in Vermont are participating in the CJR
model and would, therefore, not have been selected to participate in
the SHFFT EPM.
Final Decision: After consideration of the public comments
received, we are finalizing the proposed episode definition, without
modification, such that these EPM episodes will be initiated with the
admission to an IPPS acute-care hospital that triggers an AMI, CABG or
SHFFT episode as specified in section III.C.4.a. of this final rule. We
are also finalizing the exclusion of hospitals in Maryland and Vermont
from participation in the EPMs.
3. Financial Responsibility for the Episode of Care
As with the CJR model, and as discussed in the proposed rule, we
continue to believe it is most appropriate to identify a single type of
provider to bear financial responsibility for making repayment, if any,
to CMS under the model. Therefore, we proposed to make hospitals, as
the episode initiators, financially responsible for the episode of care
for the following several reasons:
Hospitals play a central role in coordinating episode-
related care and ensuring smooth transitions for beneficiaries
undergoing services related to SHFFT, AMI and CABG episodes. A large
portion of a beneficiary's recovery trajectory from an AMI, CABG, or
SHFFT begins during the hospital stay.
Most hospitals already have some infrastructure related to
health IT, patient and family education, and care management and
discharge planning. This includes post-acute care coordination
infrastructure and resources such as case managers, which hospitals can
build upon to achieve efficiencies under these EPMs.
By definition, these episodes always begin with an acute
care hospital stay. While often preceded by an emergency room visit and
possible transfer from another hospital's emergency room, or followed
by post-acute care, these parties are not necessarily always present
and would not be appropriate to target as the financially responsible
party for this purpose.
EPM episodes may be associated with multiple hospitalizations
through transfers. When multiple hospitalizations occur, we proposed
that the financial responsibility be given to the hospital to which the
episode is attributed, as described in section III.C.4 of the proposed
rule. We recognize that, particularly where the admission may be
preceded by an emergency room visit and subsequent transfer to a
tertiary or other regional hospital facility, patients often wish to
return home to their local area for post-acute care. Many hospitals
have recently heightened their focus on aligning their efforts with
those of community providers, both those in the immediate area as well
as more outlying areas from which they receive transfers and referrals,
to provide an improved continuum of care. In many cases, this is due to
the incentives under other CMS models and programs, including ACO
initiatives such as the Shared Savings Program, the Hospital
Readmissions Reduction Program (HRRP), and the CJR model. By focusing
on the hospital as the accountable or financially responsible entity,
we hope to continue encouraging this coordination across providers and
sought comment on ways we can best encourage these relationships within
the scope of these EPMs.
In support of our proposal that hospitals be the episode initiators
under these EPMs, we believe that hospitals are more likely than other
providers to have an adequate number of episode cases to justify an
investment in episode management for these EPMs. We also believe that
hospitals are most likely to have access to resources that would allow
them to appropriately manage and coordinate care throughout these
episodes. Finally, the hospital staff is already involved in discharge
planning and placement recommendations for Medicare beneficiaries, and
more efficient post-acute care service delivery provides substantial
opportunities for improving quality and reducing costs under EPMs. For
those hospitals that are already participating in CJR, we believe the
efforts that have been put in place to support patients receiving LEJR
will be supportive of the new EPMs proposed under this rule,
particularly for SHFFT episodes which we proposed to implement in the
same geographic areas as the CJR model.
Finally, as noted when planning for the CJR model, although the
BPCI initiative includes the possibility of a physician group practice
as a type of episode initiating participant, the physician groups
electing to participate in BPCI have done so because their practice
structure supports care redesign and other infrastructure necessary to
bear financial responsibility for episodes. These physician groups are
not necessarily representative of the typical group practice. As with
the CJR
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model, the infrastructure necessary to accept financial responsibility
for episodes is not present across all physician group practices, and
thus, as we stated in the proposed rule, we do not believe it would be
appropriate to designate physician group practices to bear the
financial responsibility for making repayments to CMS under the
proposed EPMs. We sought comment on our proposal to establish financial
responsibility and accountability under the AMI, CABG, and SHFFT EPMs
consistent with our implementation of the CJR model.
Currently, there are SHFFT, AMI, and CABG episodes being tested in
BPCI Models 2, 3 or 4. The last remaining BPCI Model 1 hospital will
end December 31, 2016 and will, therefore, not overlap with EPM. In
addition, under BPCI, there are episodes for PCI, which, if an AMI were
also involved, would fall under the AMI model proposed. We proposed
that IPPS hospitals located in an area selected for any one of the
episode payment models proposed in the proposed rule (81 FR 50834) that
also are episode initiators for episodes in the risk-bearing phase of
BPCI Models 2 or 4 be excluded from participating in the AMI, CABG, or
SHFFT EPMs if the applicable episode otherwise would qualify to be
covered under BPCI. This exclusion would be in effect only during the
time that the relevant qualifying episodes are included in one of the
BPCI models. Likewise, we proposed that if the EPM participant is not
an episode initiator for overlapping episodes under BPCI Models 2 or 4,
but these same episodes are initiated during the anchor hospitalization
by a physician group practice (PGP) under BPCI Model 2 (where the
services are provided at the episode initiating hospital) then the
episode also shall be covered under BPCI and be excluded from the EPMs
proposed under the proposed rule (81 FR 50834). Otherwise qualifying
EPM episodes (that is, those that are not part of an overlapping BPCI
AMI, CABG, PCI or SHFFT episode) at the participant hospital would be
included in these new EPMs. However, because BPCI participation is
voluntary and participating providers may select which episodes to
participate in, we proposed that a BPCI participating provider will
participate in any of the proposed AMI, CABG, or SHFFT EPMs for any
episodes not otherwise preempted under their BPCI participation. For
example, a BPCI Model 2 hospital in an AMI episode model geographic
area participating in BPCI only for CABGs will be an EPM participant in
the AMI model. Similarly, an acute care hospital participating in BPCI
for LEJR but not SHFFT episodes would be exempt from participation in
the CJR model in a CJR model geographic area but would participate in
the SHFFT model for SHFFT episodes. In addition, providers
participating in BPCI may also collaborate with an EPM participant for
episodes not covered under BPCI. It should be noted that due to
differences in how the AMI episode is defined under the AMI model
versus BPCI and the inclusion of PCI MS-DRGs under the latter, a
patient with the same discharge MS-DRG and diagnoses may qualify for a
PCI episode under BPCI and an AMI episode under the AMI model. As
stated in the proposed rule, our intent is to give precedence to BPCI
regardless of which episode a patient qualifies for if the patient
would be covered under BPCI.
In section III.D.6. of the proposed rule we discussed in more
detail how we proposed to handle situations when a beneficiary receives
services that would qualify for inclusion in more than one CMS payment
model during the same or overlapping periods of time. We welcomed input
on how these overlaps should be handled to best encourage ongoing care
coordination while minimizing the impact on other models and limiting
confusion and operational burden for providers.
While we proposed that the EPM participant be financially
responsible for the episode of care under these EPMs, we also stated
that we believe that effective care redesign requires meaningful
collaboration among acute care hospitals, post-acute care providers,
physicians, and other providers and suppliers within communities to
achieve the highest value care for Medicare beneficiaries. We continue
to believe it is essential for key providers to be aligned and engaged,
financially and otherwise, with the EPM participants, with the
potential to share financial responsibility with those EPM
participants. We noted that all relationships between and among
providers and suppliers must comply with all relevant laws and
regulations, including the fraud and abuse laws and all Medicare
payment and coverage requirements unless otherwise specified further in
this section and in sections III.I. and III.J. of the proposed rule.
Depending on a hospital's current degree of clinical integration, new
and different contractual relationships among hospitals and other
health care providers may be important, although not necessarily
required, for EPM success in a community. We acknowledge that financial
incentives for other providers may be important aspects of the model in
order for EPM participants to partner with these providers and
incentivize certain strategies to improve episode efficiency.
While we acknowledged the important role of conveners in the BPCI
model, and that AMI, CABG, and SHFFT model participants may wish to
enter into relationships with EPM collaborators and other entities in
order to manage the episode of care or distribute risk, we proposed
that the ultimate financial responsibility of the episode would remain
with the EPM participant. Exceptions to this general rule for
beneficiaries covered under certain risk bearing ACO arrangements are
outlined in section III.D.6. of this final rule. As with the CJR model,
we did not intend to restrict the ability of EPM participants to enter
into administrative or risk sharing arrangements related to these EPMs,
except to the extent that such arrangements are already restricted or
prohibited by existing law. We referred readers to section III.I. of
the final rule for further discussion of model design elements that may
outline financial arrangements between EPM participants and other
providers and suppliers.
The following is a summary of the comments received and our
responses.
Comment: We received numerous comments related to our proposal to
have the hospital be the single accountable entity for the EPM
episodes. Many commenters were supportive of this policy and, while not
ignoring the importance of other providers, agreed that hospitals were
best positioned to assume risk for these episodes. Other commenters
were less supportive of this proposal, noting that hospitals could be
disadvantaged if physicians and post-acute care providers were not also
at risk or if conflicting interests hindered their willingness to
collaborate. A few commenters expressed concern that while hospitals
would bear the risk, hospitals might be limited in their ability to
control that same risk. For example, one commenter referenced the
penalty that hospitals already face for readmissions which may not be
correlated to inpatient care. One commenter stated that post-acute care
providers would be more motivated if they were required to share in
even a small percentage of the incentives or risk directly. Another
commenter noted that the current per-diem payment system for SNFs put
SNF providers at particular risk. Although SNFs will invest resources
to reduce/shorten SNF stays, which can create significant savings for
the EPM participant, the
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commenter stated SNF providers will be disadvantaged/harmed as the
proposed regulations do not require proportional sharing of
reconciliation payments by the EPM participant with post-acute care
providers and requested that we amend the language to more clearly
outline how reconciliation payments should be shared proportionally
among all EPM collaborators, noting that this change would also likely
require these same providers to share in downside risk as well.
Other commenters objected to the hospital holding sole financial
accountability for the models as they believe that physicians,
including hospitalists, surgeons, and internal medicine subspecialists
are best positioned to impact the process of care. These commenters
stated that CMS should be giving priority to physician-centered
alternative payment models. One commenter believes that having the
hospital in charge of the bundle could give the hospital inappropriate
leverage over other participants and or lead to the exclusion of
providers if they failed to agree to the hospital's terms. Other
commenters wanted the flexibility for conveners to assume risk and
organize groups of providers, as is allowed under BPCI.
One commenter specifically stated that determination of the
accountable entity should be based not only on the ability to accept
risk but also the ability to change care delivery patterns. While one
commenter explicitly stated that ``only physicians can make the
determination as to what types of care could effectively address
patients' needs,'' that commenter also wanted payment to physicians to
be predictable and physician financial accountability limited to
``costs that are within their control.'' The perspective that
physicians were best positioned to manage the episode of care and
desire for them to have the opportunity to bear risk, particularly as
it might pertain to eligibility for advanced alternative payment model
status, was expressed by a number of commenters although the focus in
such comments was on voluntary models.
Response: We appreciate the support expressed by certain commenters
for our proposed policy to hold the initiating hospital as the
financially accountable entity for the EPM episodes. While we
acknowledge the critical importance of physicians and other providers,
in particular those providing post-acute care, in managing episodes
which extend 90 days beyond discharge from the anchor hospitalization,
we continue to believe the hospital should be the financially
accountable entity for these models. For hospitals to be successful in
managing EPMs, we firmly believe that they will need to actively
solicit the support of physicians, post-acute care providers, and other
clinical care providers in order to provide the best quality of care in
a cost effective manner. In many, if not most situations, this may
involve establishing collaborative agreements with a risk sharing
arrangement. We support other types of providers assuming risk where
they are financially able to do so and agree that providers that have a
share in the risk, both positive and negative, may be more motivated to
establish collaborative agreements. However, we do not believe that in
a model with required participation, any other provider group is
consistently as financially positioned to assume risk as is the
hospital to which the episode is attributed. We also do not want to
mandate a specific division of risk between providers or to direct the
specific terms of any collaborator agreements that may be established.
We disagree that the current proposal to make hospitals the financially
accountable entity undermines the role of the physician, and in
providing for a range of collaborator agreements, we hope that EPM
participants will actively engage in gainsharing with others. We refer
readers to section III.I of this final rule for a fuller discussion of
allowable collaborator relationships. We believe that in order to be
most successful, hospitals will reach out to other providers to
establish agreements with collaborators, although we acknowledge that
it may take time to negotiate and establish such arrangements. While
some physician groups and post-acute care providers are in a position
to take on risk, we continue to believe that many, particularly those
in smaller groups and those in more rural areas, are not and, in fact,
no commenter suggested that this was the case. Even where the focus of
a comment was on providing more opportunities for physicians to assume
risk, it was in the context of voluntary models such as BPCI. We
appreciate those comments and, in fact, will give precedence to BPCI
participants where there is such overlap. Readers are referred to
section III.D.6. of this final rule, ``Adjustments for Overlaps with
Other Innovation Center Models and CMS Programs,'' which addresses in
more detail how situations where there is an overlap between EPMs and
other episode based models will be handled. We address in section
III.D.6.b.(2). of this final rule, how patients attributed to other
physician-centric episode models will be attributed. We also note in
section III.A.3 of this final rule opportunities for future alternative
payment models which may be more physician-centric. We are committed to
testing a number of alternative payment models, many of which may be
voluntary and more appropriate for physicians or other providers to
assume risk.
Comment: We received a few comments that not only advocated for
more flexibility in which entity would be allowed to assume risk for
the episode but also suggested that CMS more actively encourage
collaboration by providing more specific operational guidance regarding
how risk should be shared among different providers. A few commenters
noted that financial agreements may not always be feasible. One
commenter noted that in markets where physicians, hospitals and post-
acute care providers already work well together, the foundation for
effective gainsharing arrangements are more likely to be in place.
Others noted that some organizations may be willing to share in any
savings but not be willing to accept downside risk.
One commenter recommended that CMS require that EPM participants
execute gainsharing arrangements with providers to establish a third
party entity to receive and distribute reconciliation payments in
accordance with the terms of such sharing agreements.
Response: We acknowledge the challenges that some EPM participants
may have in establishing effective collaborative agreements. Similarly,
we acknowledge the potential challenges that non-hospital providers
such as physicians and post-acute care providers may have in getting
EPM participants to share risk in a manner that is believed to be
equitable to all. However, we do not believe it is appropriate for CMS
to either require or establish specific criteria for the terms of such
agreements nor to specify how they should be operationalized. We
continue to believe, however, that the most successful EPMs will be
motivated to engage other providers so that interests and incentives
are aligned. We refer readers to section III.I. of this final rule,
``Financial Arrangements under EPM,'' for a full discussion of EPM
financial arrangements.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to make
hospitals the episode initiators and financially responsible for the
episode of care.
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4. Geographic Unit of Selection and Exclusion of Selected Hospitals
In order to determine the geographic unit of selection for these
episode payment models, we conducted an analysis similar to that used
for the CJR model. For the CJR model, we considered using a stratified
random sampling methodology to select: (1) Certain counties based on
their Core-Based Statistical Area (CBSA) status; (2) certain zip codes
based on their Hospital Referral Regions (HRR) status or (3) certain
states. We concluded that selection based on MSAs provided the best
balance between choosing smaller geographic units while still capturing
the impact of market patterns reflecting the mobility of patients and
providers and limiting the potential risk for patient shifting and
steerage between MSAs. HRRs are based on where patients receive
selected tertiary care services, which do not include orthopedic
services. Therefore, HRRs may not be representative of where patients
receive specialty orthopedic care or more routine orthopedic services
such as hip and knee arthroplasty. Selection of states rather than MSAs
would have greatly reduced the number of independent geographic areas
subject to selection and, therefore, the statistical power of the
evaluation. For similar reasons and to maintain consistency with the
CJR model, we proposed implementation at the MSA level.
We also similarly considered whether these new models should be
limited to hospitals where a high volume of these episodes occur, which
would result in a more narrow test on the effects of an episode-based
payment, or whether to include all hospitals in particular geographic
areas, which would result in testing the effects of an episode-based
payment approach more broadly across an accountable care community
seeking to coordinate care longitudinally across settings. However, as
with the CJR model, if we were to limit participation based on volume,
there would be more potential for behavioral changes that could include
patient shifting and steering between hospitals in a given geographic
area that could impact the test. Additionally, this approach would
provide less information on testing payments for these episodes across
a wide variety of hospitals with different characteristics. Selecting
geographic areas and including all IPPS hospitals in those areas not
otherwise excluded due to BPCI overlap as previously described and in
section III.D.6. of the proposed rule as model participants would help
to minimize the risk of participant hospitals shifting higher cost
cases out of the EPM.
In determining where to implement these EPMs, we also considered
whether implementation of the CJR model in the same geographic area
should be a factor. We realize that there is likely to be considerable
overlap in the selection criteria between MSAs where the SHFFT EPM
might be appropriate and those MSAs where the CJR model is now being
implemented. While limiting burden on hospitals is an important
consideration, we also believe that the infrastructure being put in
place as a result of the CJR model presents significant advantages for
implementation of the SHFFT model. For similar reasons, and in order to
minimize patient steerage and/or transfer for reasons due solely to the
implementation of these new payment models, we believe that it is
appropriate to implement the AMI model and CABG model together in the
same geographic areas, albeit not necessarily in the same areas as the
CJR and SHFFT models.
Therefore, given the authority in section 1115A(a)(5) of the Act,
which allows the Secretary to elect to limit testing of a model to
certain geographic areas, we proposed that the SHFFT model be
implemented in those MSAs where the CJR model is being implemented.
We also proposed that the AMI and CABG models be implemented in
MSAs selected independently based on the criteria discussed in the
proposed rule (81 FR 50815). This would result in four separate
categories of MSAs: (1) MSAs where only the CJR and SHFFT model
episodes are being implemented; (2) MSAs where only the CABG model and
AMI model episodes are being implemented; (3) MSAs where the CJR as
well as the AMI, CABG, and SHFFT models are being implemented; and (4)
MSAs where neither CJR nor any of the new episode payment models are
being implemented. We believe this will provide an opportunity to test
the impact of implementing EPMs across not only a greater diversity of
episodes but also as an increasing percentage of hospital discharges.
We sought comment on our proposal to implement the SHFFT model in the
same geographic region as the CJR model and to implement both the AMI
model and the CABG model in the same MSAs, some of which may overlap
with MSAs where the CJR and SHFFT models also are being implemented.
The following is a summary of the comments received and our
responses.
Comment: While several commenters explicitly noted concurrence with
our proposed method for selecting the MSAs where these models will be
implemented, we did receive a few comments related to the selection of
areas based on MSAs vs. other geographic units such as CBSAs as well as
other recommended criteria upon which to base our selection. We address
some of the specific factors in the comments located in this section.
Independent of the selection methodology, several commenters requested
that CMS publish a list of the hospitals CMS believed were in the
selected MSAs and allow hospitals 60 days to comment. Other commenters
requested that CMS publish the list of MSAs selected as soon as
possible to allow those hospitals impacted additional preparatory time
prior to the initial effective date of EPMs. Other commenters
emphasized the importance of maintaining beneficiary freedom of choice
in selecting where and how to receive care regardless of the
beneficiary's geographic residence or the MSAs selected for EPMs.
Response: With regard to MSAs as the geographic unit of selection,
we continue to believe, consistent with CJR, that MSAs allow us to
observe the impact of the model in a variety of circumstances and
provide the best balance between choosing smaller geographic units
while still capturing the impact of market patterns reflecting the
mobility of patients and providers. We also believe that MSAs limit the
potential risk for patient shifting and steerage. As such, we see no
reason to change the unit of selection or to be inconsistent with what
has already been implemented with CJR. For an in depth discussion of
this, we refer the reader to the final CJR rule (42 CFR part 510, 80 FR
73288). We concur that it is important that all participants clearly
understand which hospitals will be impacted. Prior to implementation
and in conjunction with the publication of this final rule, CMS will
publish a list of hospitals that, based on the geographic location
associated with the hospital's CMS Certification Number (CCN), we
believe are located in the selected MSAs and will be subject to
participation in these EPMs. Hospitals identified using this method
will have the opportunity to correct any information CMS has on file
that may impact whether they are or are not in a selected MSA by
contacting [email protected] within 45 days after the publication of the
Final Rule. Finally, we concur that beneficiaries continue to have the
freedom to choose where they will receive services, regardless of the
payment model in place in a particular geographic area. We refer
readers to
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section III.G. of this final rule, ``Monitoring and Beneficiary
Protection,'' for a discussion of these issues.
Comment: A number of commenters expressed concern about
implementing the SHFFT EPMs in those MSAs where the CJR model is being
implemented. Some commenters expressed concern that we were adding the
SHFFT model to the existing CJR model. Other commenters expressed
concern that sufficient time had not elapsed to allow hospitals or CMS
to learn from their experience. Many believe they needed more time to
be able to analyze the results from at least the first year of CJR as
well as incorporating findings from the BPCI experience before adding
the additional burden of implementing a new model with required
participation. While both CJR and SHFFT involve some of the same
providers and specialties, some commenters noted that the SHFFT patient
population was distinctly different requiring different care pathways
and resources. Because of the concern about additional burden on those
MSAs where the CJR model has been implemented, some commenters believe
that those same MSAs should, therefore, be exempt from implementing the
additional cardiac EPMs.
Response: To clarify for commenters, the SHFFT model is separate
and distinct from the CJR model although it is designed to run in the
same MSAs in which the CJR model is currently operational. We
acknowledge the challenges that hospitals implementing CJR may have in
order to implement the SHFFT EPM. While recognizing that the patients
covered under the SHFFT EPM may be frailer and potentially require
different and/or a more intensive level of care, we also continue to
believe that SHFFT is similar to CJR in that it involves many of the
same specialties and provider types. While there may be different care
pathways, we hope that much of the infrastructure and collaborator
agreements put in place will provide a solid base upon which to build
for SHFFT. As CMS seeks to move away from fee for service payment
systems to more value based purchasing, we believe that SHFFT
represents a reasonable next step in this transition.
We also acknowledge that in those MSAs where the cardiac EPMs will
be alongside CJR and now SHFFT, EPM participants will face additional
burdens and challenges. However, we do not believe that it is
appropriate to exclude those MSAs where CJR and SHFFT will be
implemented from eligibility for selection for the cardiac EPMs.
Exclusion of these MSAs would result in a comparative over
representation in the cardiac EPMs of lower cost and lower population
MSAs due to the manner in which the CJR MSAs were selected. For a full
discussion of the criteria for selecting cardiac EPMs, we refer readers
to section III.B.5. of this final rule, ``Overview and Options for
Geographic Area Selection for AMI and CABG Episodes''. As we move
towards more inpatient care being covered under these types of models,
we will monitor and evaluate the impact on different types of hospitals
implementing multiple EPMs so as to minimize operational burden and
improve outcomes.
Comment: Several commenters did not disagree with the use of MSAs
specifically, but did note the potential for negative impact on certain
hospitals in a model where all hospitals in the MSA providing the
covered services are required to participate. This included concern for
both high performing regional and national referral centers which may
already be providing high quality care at a lower cost as well as
hospitals with more limited numbers of eligible discharges and/or those
serving at risk populations which often have lower operating margins
and thus may be at greater financial risk. These commenters suggested
that demographic factors such as age, race, and poverty levels could be
used to limit which MSAs were selected.
Response: We acknowledge that some hospitals may face particular
challenges in implementing EPMs whether it be due to demographic
factors related to their patient base, a lower number of potential EPMs
each year, or other factors. A key reason for doing a model with
required participation is, in fact, to examine and better understand
the impact of a model on a broader range of facility types and
communities than are usually included in a voluntary model. Although we
do not believe that using specific demographic factors in MSA selection
is appropriate, in response to comments on other sections of this rule
around risk-adjustment, we are finalizing a timeframe for the
implementation of downside risk that allows us time to look carefully
at different approaches for recognizing and adjusting for risk in these
models which we will discuss via notice and comment rulemaking for FY
2019 and we believe that these actions will help to resolve concerns
expressed regarding greater financial risk for high performing regional
and national referral centers.
A key rationale for conducting a model with required participation
is the ability to examine variations in the impact of the model on a
broad range of hospitals in a variety of different market conditions in
order to better understand how the model operates in a variety of
circumstances. Although demographic factors are not proposed to be part
of the selection process for MSAs, we do consider, as noted in the
proposed and this final rule, these factors to be important to the
proper understanding of the impact of the models and where is more or
less successful. The evaluation will consider the suggested demographic
domains and other measures in determining which MSAs are appropriate
comparison markets as well as for possible subgroup analyses.
Comment: A few commenters suggested eliminating those MSAs that had
a higher penetration of Medicare Advantage plans or suggested that we
select MSAs that will minimize overlap with BPCI and ACO participating
hospitals.
Response: We note in this rule the reasons for aligning the MSAs
where the SHFFT EPM will be implemented with those MSAs where the CJR
model has already been implemented. In doing so, we accept the
exclusion of those MSAs that were excluded from the CJR model due to
the limited volume of LEJR procedures performed there.
In the proposed rule we similarly proposed elimination of some MSAs
from selection for the cardiac EPMs due to having lower numbers of
episodes and having a higher number of episodes covered under the BPCI
models. We refer readers to section III.B.5. of this final rule for a
full discussion of the selection criteria for MSAs where the cardiac
episodes will be implemented.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
implement the SHFFT EPM in those MSAs where the CJR model is being
implemented. Further, we are finalizing the proposal to implement the
cardiac EPMs in randomly selected MSAs from among all those in the
country meeting the criteria specified in section III.B.5. of this
final rule.
5. Overview and Options for Geographic Area Selection for AMI and CABG
Episodes
We proposed that the AMI and CABG EPMs be implemented together in
the same MSAs. These AMI/CABG-participating MSAs may or may not also be
CJR/SHFFT-EPM participating MSAs. The selection of MSAs for AMI/CABG
EPMs would occur through a random selection of eligible MSAs.
We proposed to require participation in the AMI and CABG models of
all hospitals, with limited exceptions as
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previously discussed in section III.B.4. of the proposed rule, paid
under the IPPS that are physically located in a county in an MSA
selected through the methodology outlined in section III.B.5.b. of the
proposed rule (81 FR 50815), to test and evaluate the effects of an
episode-based payment approach for the proposed EPMs. We proposed to
determine that a hospital is located in an area selected if the
hospital is physically located within the boundary of any of the
counties in that MSA as of the date the selection is made.
Although MSAs are revised periodically, with counties added or
removed from certain MSAs, we proposed to maintain the same cohort of
selected hospitals throughout the 5-year performance periods of the
EPMs with limited exceptions as described later in this section. Thus,
we proposed neither to add hospitals to an EPM if after the start of
such EPM new counties are added to one of the selected MSAs nor to
remove hospitals from an EPM if counties are removed from one of the
selected MSAs. We believe that this approach will best maintain the
consistency of the participants in the EPMs, which is crucial for our
ability to evaluate their respective results. However, we retain the
possibility of adding a hospital that is opened or incorporated within
one of the selected counties after the selection is made and during the
period of performance. (See section III.D. of this final rule for
discussion of how target prices will be determined for such hospitals.)
The manner in which CMS tracks and identifies hospitals is through
the CMS Certification Number (CCN). In keeping with this approach,
these EPMs will administer model related activities at the CCN level
including the determination of physical location. The physical location
associated with the CCN at the time of an EPM's start will be used to
determine whether that CCN is located in a selected MSA. For hospitals
that share a CCN across various locations, all hospitals under that CCN
would be required to participate in the applicable EPM if the physical
address associated with the CCN is in the MSA selected, unless
otherwise excluded. Similarly, all hospitals under the same CCN, even
if some are physically located in the MSA selected for participation,
would not participate in the applicable EPM if the physical address
associated with the CCN is not in the MSA.
We considered including hospitals in a given MSA based on whether
the hospitals were classified into the MSA for IPPS wage index
purposes. However, such a process would be more complicated, and we
could not find any compelling reasons favoring such approach. For
example, we could assign hospitals to metro divisions of MSAs when
those divisions exist. In addition, there is the IPPS process of
geographic reclassification by which a hospital's payments can be based
on a geographic area other than the one where the hospital is
physically located. For the purpose of the EPMs, it is simpler and more
straightforward to use a hospital's physical location as the basis of
its assignment to a geographic unit. This decision would have no impact
on a hospital's payment under the IPPS. We sought comment on our
proposal to include a hospital as an EPM participant based on the
physical location associated with the CCN of the hospital in one of the
counties included in a selected MSA.
The following is a summary of the comments received and our
responses.
Comment: One commenter expressed that implementing the two cardiac
EPMs, CABG and AMI, in the same geographic areas would overburden
participant hospitals. They stated that the two cardiac conditions are
characterized by clinically different populations and require distinct
care teams and the opportunities for common care redesign approaches
are limited.
Response: We understand the amount of effort required to redesign
care processes and that often these are specific to a condition and not
always immediately transferrable between conditions. In regards to
implementing two cardiac episodes there is an expectation that some
economies of scale will present themselves with the cardiac episode-
based approaches even though the care teams and patient populations are
distinct.
As discussed in section III.C. of this final rule, the AMI and CABG
model episodes primarily include beneficiaries with cardiovascular
disease, a chronic condition which likely contributed to the acute
events or procedures that initiate the episodes. Beneficiaries
experiencing an AMI can be treated by different clinical modalities
including medical management and surgical intervention such as PCI and
CABG. The decision as to which treatment is medically appropriate for a
given beneficiary is both complex and subject to evolving medical
knowledge and practice norms. Furthermore, approximately 30 percent of
CABGs are performed during the care of AMIs. Because of the close
connection between these two models, CMS believes that testing the AMI
and the CABG EPMs in the same markets decreases the probability that
clinical decision making regarding the course of treatments would be
unduly influenced by inclusion or exclusion in one of the two cardiac
EPMs. If the two cardiac EPMs were in different areas, the AMI EPM
would be structured in such a way as to include AMIs treated with CABG.
Thus, the separation of the two cardiac EPMs into different MSAs would
not reduce the burdens associated with hospitals who are simultaneously
needing to manage patients treated under a variety of modalities. It
would, on the other hand, conceivably increase the complexity of
management for participants who would be faced with the situation of
having only the 30 percent of CABGs done in conjunction with an AMI
included in a model.
Comment: One commenter requested that if a health system had member
hospitals within MSAs selected for inclusion in a cardiac EPM that they
be allowed to have their member hospitals in non-selected areas also be
included in the model. They stated that the ability to have all of
their member hospitals in one model would allow for care to be provided
under a unified system and would result in increased coordination.
Response: The cardiac EPMs are structured as required models. As
such, they will require hospitals within selected geographic areas to
participate (unless otherwise excluded as set forth in this final
rule). Hospitals who are not in a selected MSA but are part of a health
system that includes selected included hospitals will not subject to
the EPM rules and incentives structures. However, if a health system
wishes to implement certain care coordination activities across their
entire spectrum of hospitals they would not be precluded from doing so
as long as they comply with current regulations and law. The inclusion
of additional hospitals outside of these selected areas would
constitute a major change to the model that was not considered in the
proposed rule. CMS previously offered solicited participation in the
BPCI initiative, a bundled payment model. Please refer to section
III.A.3. of this final rule for a discussion of the possibility of
future bundled payment models.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
implement the CABG and the AMI EPMs in the same areas, and to
administer model-related activities at the CCN level including the
determination of physical location. The physical location associated
with the CCN at the time of an EPM's start will
[[Page 228]]
be used to determine whether that CCN is located in a selected MSA.
a. Exclusion of Certain MSAs
We considered whether certain MSAs should be exempt from the
possibility of selection for the AMI/CABG EPMs' implementation. We
considered exclusions based on the anticipated number of AMI episodes
and CABG episodes in the MSA. We also considered exclusions based on
the degree to which such EPMs' episodes would be impacted by overlaps
with other payment initiatives, including BPCI and ACOs.
First, we considered the advisability of MSA exclusions based on
the number of episodes in a year. We identified qualifying AMI and CABG
episodes that initiated between January 1, 2014, and December 31, 2014.
AMI and CABG episodes were attributed to an MSA based on the location
of the CCN associated with the initiating hospital using the Provider
of Service file. Due to the smaller number of relevant AMI and CABG
episodes occurring in some MSAs, an exclusion rule that required a
large number of episodes in each MSA would result in fewer MSAs
eligible for selection than was necessary given the desired number of
MSAs and the requirement to have 50 percent or more of MSAs remain in a
pool of possible comparison MSAs. From the perspective of evaluating
changes to utilization and spending under EPMs, there is no analytic
need to eliminate MSAs with small numbers. In fact, including smaller
MSAs has the analytic advantage of giving CMS more experience operating
EPMs in the smaller-MSA contexts that will help us generalize our EPM-
evaluation findings.
We have a strong interest in being able to observe how well EPMs
operate in areas with a lower volume of episodes, and, in particular,
the consequences of the models for AMI episodes where CABG is not
commonly performed or where standard practice is to refer all CABGs
outside of the MSA. Given our desire to assess the operation of the AMI
EPM in areas with little or no CABG episodes and the desire to have the
two cardiac EPMs be administered together in the same MSAs, we proposed
that the MSA exclusion rules be based on the number of AMI episodes
only. This will allow for the inclusion of MSAs with no CABGs.
There is no analytic requirement for a minimum number of cases and
there are advantages to including smaller cities. At the same time, we
acknowledge that areas with few AMI cases may believe that they will
face challenges under the EPMs. Therefore, we proposed an exclusion
rule that MSAs with fewer than 75 AMI episodes (determined as discussed
in section III.C. of this final rule) will be removed from the
possibility of selection. Cases in hospitals paid under either the CAH
methodology or the Maryland All-Payer Model are not included in the
count of eligible episodes. We examined a number of different minimum-
episode-number cutoffs. The use of the 75 AMIs in a year was a designed
to balance limiting the impact of outlier cases on the MSA average
episode spending and the desire to retain a non-negligible
representation of MSAs in the under 100,000 population and the 100,000
to 200,000 population ranges in our selection pool. The application of
Exclusion Rule 1: ``Less than 75 qualifying AMI episodes in the
reference year'' resulted in the removal of 49 MSAs from possible
selection.
Second, we assessed exclusion rules based on overlap with BPCI. We
proposed Exclusion Rule 2 such that MSAs are removed from possible
selection if there were fewer than 75 non-BPCI AMI episodes in the MSA
in the reference year. For the purposes of this exclusion, the number
of non-BPCI episodes was estimated by subtracting BPCI cases from the
total number of cases used in Exclusion Rule 1. BPCI cases for this
purpose are ones during the reference year associated with a hospital
or a PGP BPCI Model 2 or 4 episode initiator participating in an AMI,
PCI, or CABG episode as of January 1, 2016. Such criterion removed an
additional 26 MSAs from potential selection.
Third, we proposed to exclude MSAs from possible selection based on
whether the number of non-BPCI AMI episodes calculated under Exclusion
Rule 2 is less than 50 percent of the total number of AMI episodes
calculated under Exclusion Rule 1. We anticipate that some degree of
overlap in the BPCI and other EPMs will be mutually helpful. However,
we acknowledge that some providers may have concerns that a BPCI Model
2 AMI and PCI participation rate of more than 50 percent may impair the
ability of participants in either the EPMs or the BPCI models to
succeed in the objectives of their respective initiatives. As a result
of this third criterion, 13 additional MSAs were removed from possible
selection.
We considered whether there should be an exclusion rule based on
the anticipated degree of overlap between the AMI and CABG EPMs and
patients who are aligned prospectively to ACOs that are taking two-
sided risk, such as ACOs participating in the Next Generation ACO model
or Track 3 of the Shared Savings Program. We examined numbers
associated with ACOs meeting this status as of May 1, 2016, and this
examination did not result in any additional MSAs falling below the
threshold of 75 AMI episodes. Consequently, we did not propose any MSA
exclusion rule based on the presence of ACOs.
Please refer to Table 1 for the status of each MSA based on these
exclusion criteria, available at http://innovation.cms.gov/initiatives/epm. After applying these three exclusions, 294 MSAs out of 384 total
MSAs are eligible for selection using our proposed selection
methodology.
Table 1--MSA Exclusion Rule Status and Eligibility for Selection Status for Inclusion in AMI and CABG EPMs in the Proposed Rule
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rule 2: 75+ non- BPCI Rule 3: <50% BPCI MSA eligible for
CBSA_OMB MSA name Rule 1: 75+ AMIs AMI AMI selection
--------------------------------------------------------------------------------------------------------------------------------------------------------
10180............................. Abilene, TX............... Pass................. Pass................. Pass................ Include.
10380............................. Aguadilla-Isabela, PR..... Fail................. Fail................. Pass................ Exclude.
10420............................. Akron, OH................. Pass................. Pass................. Pass................ Include.
10500............................. Albany, GA................ Pass................. Pass................. Pass................ Include.
10540............................. Albany, OR................ Fail................. Fail................. Pass................ Exclude.
10580............................. Albany-Schenectady-Troy, Pass................. Pass................. Fail................ Exclude.
NY.
10740............................. Albuquerque, NM........... Pass................. Pass................. Pass................ Include.
10780............................. Alexandria, LA............ Pass................. Pass................. Pass................ Include.
[[Page 229]]
10900............................. Allentown-Bethlehem- Pass................. Pass................. Pass................ Include.
Easton, PA-NJ.
11020............................. Altoona, PA............... Pass................. Pass................. Pass................ Include.
11100............................. Amarillo, TX.............. Pass................. Pass................. Pass................ Include.
11180............................. Ames, IA.................. Pass................. Pass................. Pass................ Include.
11260............................. Anchorage, AK............. Pass................. Pass................. Pass................ Include.
11460............................. Ann Arbor, MI............. Pass................. Pass................. Pass................ Include.
11500............................. Anniston-Oxford- Pass................. Pass................. Pass................ Include.
Jacksonville, AL.
11540............................. Appleton, WI.............. Pass................. Pass................. Pass................ Include.
11640............................. Arecibo, PR............... Fail................. Fail................. Pass................ Exclude.
11700............................. Asheville, NC............. Pass................. Pass................. Pass................ Include.
12020............................. Athens-Clarke County, GA.. Pass................. Pass................. Pass................ Include.
12060............................. Atlanta-Sandy Springs- Pass................. Pass................. Pass................ Include.
Roswell, GA.
12100............................. Atlantic City-Hammonton, Pass................. Pass................. Pass................ Include.
NJ.
12220............................. Auburn-Opelika, AL........ Pass................. Pass................. Pass................ Include.
12260............................. Augusta-Richmond County, Pass................. Pass................. Pass................ Include.
GA-SC.
12420............................. Austin-Round Rock, TX..... Pass................. Pass................. Pass................ Include.
12540............................. Bakersfield, CA........... Pass................. Pass................. Fail................ Exclude.
12620............................. Bangor, ME................ Pass................. Pass................. Pass................ Include.
12700............................. Barnstable Town, MA....... Pass................. Pass................. Pass................ Include.
12940............................. Baton Rouge, LA........... Pass................. Pass................. Pass................ Include.
12980............................. Battle Creek, MI.......... Fail................. Fail................. Pass................ Exclude.
13020............................. Bay City, MI.............. Pass................. Pass................. Pass................ Include.
13140............................. Beaumont-Port Arthur, TX.. Pass................. Pass................. Pass................ Include.
13220............................. Beckley, WV............... Pass................. Pass................. Pass................ Include.
13380............................. Bellingham, WA............ Pass................. Pass................. Pass................ Include.
13460............................. Bend-Redmond, OR.......... Pass................. Pass................. Pass................ Include.
13740............................. Billings, MT.............. Pass................. Pass................. Pass................ Include.
13780............................. Binghamton, NY............ Pass................. Fail................. Fail................ Exclude.
13820............................. Birmingham-Hoover, AL..... Pass................. Pass................. Pass................ Include.
13900............................. Bismarck, ND.............. Pass................. Pass................. Pass................ Include.
13980............................. Blacksburg-Christiansburg- Fail................. Fail................. Pass................ Exclude.
Radford, VA.
14010............................. Bloomington, IL........... Pass................. Pass................. Pass................ Include.
14020............................. Bloomington, IN........... Pass................. Pass................. Pass................ Include.
14100............................. Bloomsburg-Berwick, PA.... Pass................. Pass................. Pass................ Include.
14260............................. Boise City, ID............ Pass................. Pass................. Pass................ Include.
14460............................. Boston-Cambridge-Newton, Pass................. Pass................. Pass................ Include.
MA-NH.
14500............................. Boulder, CO............... Pass................. Fail................. Pass................ Exclude.
14540............................. Bowling Green, KY......... Pass................. Fail................. Fail................ Exclude.
14740............................. Bremerton-Silverdale, WA.. Pass................. Fail................. Fail................ Exclude.
14860............................. Bridgeport-Stamford- Pass................. Pass................. Pass................ Include.
Norwalk, CT.
15180............................. Brownsville-Harlingen, TX. Pass................. Pass................. Pass................ Include.
15260............................. Brunswick, GA............. Pass................. Pass................. Pass................ Include.
15380............................. Buffalo-Cheektowaga- Pass................. Pass................. Fail................ Exclude.
Niagara Falls, NY.
15500............................. Burlington, NC............ Fail................. Fail................. Pass................ Exclude.
15540............................. Burlington-South Pass................. Pass................. Pass................ Include.
Burlington, VT.
15940............................. Canton-Massillon, OH...... Pass................. Pass................. Pass................ Include.
15980............................. Cape Coral-Fort Myers, FL. Pass................. Pass................. Pass................ Include.
16020............................. Cape Girardeau, MO-IL..... Pass................. Pass................. Pass................ Include.
16060............................. Carbondale-Marion, IL..... Pass................. Pass................. Pass................ Include.
16180............................. Carson City, NV........... Pass................. Pass................. Pass................ Include.
16220............................. Casper, WY................ Pass................. Fail................. Pass................ Exclude.
16300............................. Cedar Rapids, IA.......... Pass................. Pass................. Pass................ Include.
16540............................. Chambersburg-Waynesboro, Pass................. Pass................. Pass................ Include.
PA.
16580............................. Champaign-Urbana, IL...... Pass................. Pass................. Pass................ Include.
16620............................. Charleston, WV............ Pass................. Pass................. Pass................ Include.
16700............................. Charleston-North Pass................. Pass................. Pass................ Include.
Charleston, SC.
16740............................. Charlotte-Concord- Pass................. Pass................. Pass................ Include.
Gastonia, NC-SC.
16820............................. Charlottesville, VA....... Pass................. Pass................. Pass................ Include.
16860............................. Chattanooga, TN-GA........ Pass................. Pass................. Pass................ Include.
16940............................. Cheyenne, WY.............. Pass................. Pass................. Pass................ Include.
16980............................. Chicago-Naperville-Elgin, Pass................. Pass................. Pass................ Include.
IL-IN-WI.
17020............................. Chico, CA................. Pass................. Pass................. Pass................ Include.
17140............................. Cincinnati, OH-KY-IN...... Pass................. Pass................. Pass................ Include.
17300............................. Clarksville, TN-KY........ Pass................. Pass................. Pass................ Include.
17420............................. Cleveland, TN............. Fail................. Fail................. Pass................ Exclude.
17460............................. Cleveland-Elyria, OH...... Pass................. Pass................. Pass................ Include.
17660............................. Coeur d'Alene, ID......... Pass................. Pass................. Pass................ Include.
17780............................. College Station-Bryan, TX. Pass................. Pass................. Pass................ Include.
[[Page 230]]
17820............................. Colorado Springs, CO...... Pass................. Pass................. Pass................ Include.
17860............................. Columbia, MO.............. Pass................. Pass................. Pass................ Include.
17900............................. Columbia, SC.............. Pass................. Pass................. Pass................ Include.
17980............................. Columbus, GA-AL........... Pass................. Pass................. Pass................ Include.
18020............................. Columbus, IN.............. Pass................. Pass................. Pass................ Include.
18140............................. Columbus, OH.............. Pass................. Pass................. Fail................ Exclude.
18580............................. Corpus Christi, TX........ Pass................. Pass................. Pass................ Include.
18700............................. Corvallis, OR............. Pass................. Pass................. Pass................ Include.
18880............................. Crestview-Fort Walton Pass................. Pass................. Pass................ Include.
Beach-Destin, FL.
19100............................. Dallas-Fort Worth- Pass................. Pass................. Pass................ Include.
Arlington, TX.
19140............................. Dalton, GA................ Pass................. Fail................. Fail................ Exclude.
19180............................. Danville, IL.............. Fail................. Fail................. Pass................ Exclude.
19300............................. Daphne-Fairhope-Foley, AL. Pass................. Pass................. Pass................ Include.
19340............................. Davenport-Moline-Rock Pass................. Pass................. Pass................ Include.
Island, IA-IL.
19380............................. Dayton, OH................ Pass................. Pass................. Pass................ Include.
19460............................. Decatur, AL............... Fail................. Fail................. Pass................ Exclude.
19500............................. Decatur, IL............... Pass................. Pass................. Pass................ Include.
19660............................. Deltona-Daytona Beach- Pass................. Pass................. Pass................ Include.
Ormond Beach, FL.
19740............................. Denver-Aurora-Lakewood, CO Pass................. Pass................. Pass................ Include.
19780............................. Des Moines-West Des Pass................. Pass................. Pass................ Include.
Moines, IA.
19820............................. Detroit-Warren-Dearborn, Pass................. Pass................. Pass................ Include.
MI.
20020............................. Dothan, AL................ Pass................. Pass................. Pass................ Include.
20100............................. Dover, DE................. Pass................. Pass................. Pass................ Include.
20220............................. Dubuque, IA............... Pass................. Fail................. Fail................ Exclude.
20260............................. Duluth, MN-WI............. Pass................. Pass................. Pass................ Include.
20500............................. Durham-Chapel Hill, NC.... Pass................. Pass................. Pass................ Include.
20700............................. East Stroudsburg, PA...... Pass................. Fail................. Pass................ Exclude.
20740............................. Eau Claire, WI............ Pass................. Pass................. Pass................ Include.
20940............................. El Centro, CA............. Fail................. Fail................. Fail................ Exclude.
21060............................. Elizabethtown-Fort Knox, Pass................. Pass................. Pass................ Include.
KY.
21140............................. Elkhart-Goshen, IN........ Pass................. Pass................. Pass................ Include.
21300............................. Elmira, NY................ Pass................. Pass................. Pass................ Include.
21340............................. El Paso, TX............... Pass................. Pass................. Pass................ Include.
21500............................. Erie, PA.................. Pass................. Pass................. Pass................ Include.
21660............................. Eugene, OR................ Pass................. Pass................. Pass................ Include.
21780............................. Evansville, IN-KY......... Pass................. Pass................. Pass................ Include.
21820............................. Fairbanks, AK............. Fail................. Fail................. Pass................ Exclude.
22020............................. Fargo, ND-MN.............. Pass................. Pass................. Pass................ Include.
22140............................. Farmington, NM............ Pass................. Pass................. Pass................ Include.
22180............................. Fayetteville, NC.......... Pass................. Pass................. Pass................ Include.
22220............................. Fayetteville-Springdale- Pass................. Pass................. Pass................ Include.
Rogers, AR-MO.
22380............................. Flagstaff, AZ............. Fail................. Fail................. Pass................ Exclude.
22420............................. Flint, MI................. Pass................. Pass................. Pass................ Include.
22500............................. Florence, SC.............. Pass................. Pass................. Pass................ Include.
22520............................. Florence-Muscle Shoals, AL Pass................. Pass................. Pass................ Include.
22540............................. Fond du Lac, WI........... Fail................. Fail................. Pass................ Exclude.
22660............................. Fort Collins, CO.......... Pass................. Pass................. Pass................ Include.
22900............................. Fort Smith, AR-OK......... Pass................. Pass................. Fail................ Exclude.
23060............................. Fort Wayne, IN............ Pass................. Pass................. Pass................ Include.
23420............................. Fresno, CA................ Pass................. Pass................. Pass................ Include.
23460............................. Gadsden, AL............... Pass................. Pass................. Pass................ Include.
23540............................. Gainesville, FL........... Pass................. Pass................. Pass................ Include.
23580............................. Gainesville, GA........... Pass................. Pass................. Pass................ Include.
23900............................. Gettysburg, PA............ Fail................. Fail................. Pass................ Exclude.
24020............................. Glens Falls, NY........... Fail................. Fail................. Pass................ Exclude.
24140............................. Goldsboro, NC............. Fail................. Fail................. Pass................ Exclude.
24220............................. Grand Forks, ND-MN........ Pass................. Pass................. Pass................ Include.
24260............................. Grand Island, NE.......... Fail................. Fail................. Pass................ Exclude.
24300............................. Grand Junction, CO........ Pass................. Pass................. Pass................ Include.
24340............................. Grand Rapids-Wyoming, MI.. Pass................. Pass................. Pass................ Include.
24420............................. Grants Pass, OR........... Fail................. Fail................. Pass................ Exclude.
24500............................. Great Falls, MT........... Fail................. Fail................. Pass................ Exclude.
24540............................. Greeley, CO............... Pass................. Pass................. Pass................ Include.
24580............................. Green Bay, WI............. Pass................. Pass................. Pass................ Include.
24660............................. Greensboro-High Point, NC. Pass................. Pass................. Pass................ Include.
24780............................. Greenville, NC............ Pass................. Pass................. Pass................ Include.
24860............................. Greenville-Anderson- Pass................. Pass................. Pass................ Include.
Mauldin, SC.
25020............................. Guayama, PR............... Fail................. Fail................. Pass................ Exclude.
[[Page 231]]
25060............................. Gulfport-Biloxi- Pass................. Pass................. Pass................ Include.
Pascagoula, MS.
25180............................. Hagerstown-Martinsburg, MD- Pass................. Fail................. Fail................ Exclude.
WV.
25220............................. Hammond, LA............... Fail................. Fail................. Pass................ Exclude.
25260............................. Hanford-Corcoran, CA...... Fail................. Fail................. Pass................ Exclude.
25420............................. Harrisburg-Carlisle, PA... Pass................. Pass................. Pass................ Include.
25500............................. Harrisonburg, VA.......... Pass................. Fail................. Fail................ Exclude.
25540............................. Hartford-West Hartford- Pass................. Pass................. Pass................ Include.
East Hartford, CT.
25620............................. Hattiesburg, MS........... Pass................. Pass................. Pass................ Include.
25860............................. Hickory-Lenoir-Morganton, Pass................. Pass................. Pass................ Include.
NC.
25940............................. Hilton Head Island- Pass................. Pass................. Pass................ Include.
Bluffton-Beaufort, SC.
26140............................. Homosassa Springs, FL..... Pass................. Pass................. Pass................ Include.
26300............................. Hot Springs, AR........... Pass................. Pass................. Pass................ Include.
26380............................. Houma-Thibodaux, LA....... Pass................. Pass................. Pass................ Include.
26420............................. Houston-The Woodlands- Pass................. Pass................. Pass................ Include.
Sugar Land, TX.
26580............................. Huntington-Ashland, WV-KY- Pass................. Pass................. Pass................ Include.
OH.
26620............................. Huntsville, AL............ Pass................. Pass................. Pass................ Include.
26820............................. Idaho Falls, ID........... Pass................. Pass................. Pass................ Include.
26900............................. Indianapolis-Carmel- Pass................. Pass................. Pass................ Include.
Anderson, IN.
26980............................. Iowa City, IA............. Pass................. Pass................. Pass................ Include.
27060............................. Ithaca, NY................ Fail................. Fail................. Pass................ Exclude.
27100............................. Jackson, MI............... Pass................. Pass................. Pass................ Include.
27140............................. Jackson, MS............... Pass................. Pass................. Pass................ Include.
27180............................. Jackson, TN............... Pass................. Fail................. Fail................ Exclude.
27260............................. Jacksonville, FL.......... Pass................. Pass................. Pass................ Include.
27340............................. Jacksonville, NC.......... Fail................. Fail................. Pass................ Exclude.
27500............................. Janesville-Beloit, WI..... Pass................. Pass................. Pass................ Include.
27620............................. Jefferson City, MO........ Pass................. Pass................. Pass................ Include.
27740............................. Johnson City, TN.......... Pass................. Fail................. Fail................ Exclude.
27780............................. Johnstown, PA............. Pass................. Pass................. Pass................ Include.
27860............................. Jonesboro, AR............. Pass................. Pass................. Pass................ Include.
27900............................. Joplin, MO................ Pass................. Pass................. Pass................ Include.
27980............................. Kahului-Wailuku-Lahaina, Fail................. Fail................. Pass................ Exclude.
HI.
28020............................. Kalamazoo-Portage, MI..... Pass................. Pass................. Pass................ Include.
28100............................. Kankakee, IL.............. Pass................. Pass................. Pass................ Include.
28140............................. Kansas City, MO-KS........ Pass................. Pass................. Pass................ Include.
28420............................. Kennewick-Richland, WA.... Pass................. Pass................. Pass................ Include.
28660............................. Killeen-Temple, TX........ Pass................. Pass................. Pass................ Include.
28700............................. Kingsport-Bristol-Bristol, Pass................. Pass................. Pass................ Include.
TN-VA.
28740............................. Kingston, NY.............. Fail................. Fail................. Pass................ Exclude.
28940............................. Knoxville, TN............. Pass................. Pass................. Pass................ Include.
29020............................. Kokomo, IN................ Fail................. Fail................. Pass................ Exclude.
29100............................. La Crosse-Onalaska, WI-MN. Pass................. Pass................. Pass................ Include.
29180............................. Lafayette, LA............. Pass................. Pass................. Pass................ Include.
29200............................. Lafayette-West Lafayette, Pass................. Pass................. Pass................ Include.
IN.
29340............................. Lake Charles, LA.......... Pass................. Pass................. Pass................ Include.
29420............................. Lake Havasu City-Kingman, Pass................. Pass................. Pass................ Include.
AZ.
29460............................. Lakeland-Winter Haven, FL. Pass................. Pass................. Pass................ Include.
29540............................. Lancaster, PA............. Pass................. Fail................. Fail................ Exclude.
29620............................. Lansing-East Lansing, MI.. Pass................. Pass................. Pass................ Include.
29700............................. Laredo, TX................ Pass................. Fail................. Pass................ Exclude.
29740............................. Las Cruces, NM............ Pass................. Pass................. Pass................ Include.
29820............................. Las Vegas-Henderson- Pass................. Pass................. Pass................ Include.
Paradise, NV.
29940............................. Lawrence, KS.............. Fail................. Fail................. Pass................ Exclude.
30020............................. Lawton, OK................ Pass................. Pass................. Pass................ Include.
30140............................. Lebanon, PA............... Pass................. Fail................. Pass................ Exclude.
30300............................. Lewiston, ID-WA........... Fail................. Fail................. Pass................ Exclude.
30340............................. Lewiston-Auburn, ME....... Pass................. Pass................. Pass................ Include.
30460............................. Lexington-Fayette, KY..... Pass................. Pass................. Pass................ Include.
30620............................. Lima, OH.................. Pass................. Pass................. Pass................ Include.
30700............................. Lincoln, NE............... Pass................. Pass................. Pass................ Include.
30780............................. Little Rock-North Little Pass................. Pass................. Pass................ Include.
Rock-Conway, AR.
30860............................. Logan, UT-ID.............. Fail................. Fail................. Pass................ Exclude.
30980............................. Longview, TX.............. Pass................. Pass................. Pass................ Include.
31020............................. Longview, WA.............. Fail................. Fail................. Pass................ Exclude.
31080............................. Los Angeles-Long Beach- Pass................. Pass................. Pass................ Include.
Anaheim, CA.
31140............................. Louisville/Jefferson Pass................. Pass................. Pass................ Include.
County, KY-IN.
31180............................. Lubbock, TX............... Pass................. Pass................. Pass................ Include.
31340............................. Lynchburg, VA............. Pass................. Pass................. Pass................ Include.
[[Page 232]]
31420............................. Macon, GA................. Pass................. Pass................. Pass................ Include.
31460............................. Madera, CA................ Fail................. Fail................. Pass................ Exclude.
31540............................. Madison, WI............... Pass................. Pass................. Pass................ Include.
31700............................. Manchester-Nashua, NH..... Pass................. Pass................. Pass................ Include.
31740............................. Manhattan, KS............. Fail................. Fail................. Pass................ Exclude.
31860............................. Mankato-North Mankato, MN. Fail................. Fail................. Pass................ Exclude.
31900............................. Mansfield, OH............. Pass................. Pass................. Pass................ Include.
32420............................. Mayag[uuml]ez, PR......... Fail................. Fail................. Pass................ Exclude.
32580............................. McAllen-Edinburg-Mission, Pass................. Pass................. Fail................ Exclude.
TX.
32780............................. Medford, OR............... Pass................. Pass................. Pass................ Include.
32820............................. Memphis, TN-MS-AR......... Pass................. Pass................. Pass................ Include.
32900............................. Merced, CA................ Fail................. Fail................. Pass................ Exclude.
33100............................. Miami-Fort Lauderdale-West Pass................. Pass................. Pass................ Include.
Palm Beach, FL.
33140............................. Michigan City-La Porte, IN Pass................. Pass................. Pass................ Include.
33220............................. Midland, MI............... Pass................. Pass................. Pass................ Include.
33260............................. Midland, TX............... Pass................. Fail................. Pass................ Exclude.
33340............................. Milwaukee-Waukesha-West Pass................. Pass................. Pass................ Include.
Allis, WI.
33460............................. Minneapolis-St. Paul- Pass................. Pass................. Pass................ Include.
Bloomington, MN-WI.
33540............................. Missoula, MT.............. Pass................. Pass................. Pass................ Include.
33660............................. Mobile, AL................ Pass................. Pass................. Pass................ Include.
33700............................. Modesto, CA............... Pass................. Pass................. Pass................ Include.
33740............................. Monroe, LA................ Pass................. Pass................. Pass................ Include.
33780............................. Monroe, MI................ Pass................. Pass................. Pass................ Include.
33860............................. Montgomery, AL............ Pass................. Pass................. Pass................ Include.
34060............................. Morgantown, WV............ Pass................. Pass................. Pass................ Include.
34100............................. Morristown, TN............ Fail................. Fail................. Pass................ Exclude.
34580............................. Mount Vernon-Anacortes, WA Pass................. Fail................. Pass................ Exclude.
34620............................. Muncie, IN................ Pass................. Pass................. Pass................ Include.
34740............................. Muskegon, MI.............. Pass................. Pass................. Pass................ Include.
34820............................. Myrtle Beach-Conway-North Pass................. Pass................. Pass................ Include.
Myrtle Beach, SC-NC.
34900............................. Napa, CA.................. Pass................. Fail................. Fail................ Exclude.
34940............................. Naples-Immokalee-Marco Pass................. Pass................. Pass................ Include.
Island, FL.
34980............................. Nashville-Davidson-- Pass................. Pass................. Pass................ Include.
Murfreesboro--Franklin,
TN.
35100............................. New Bern, NC.............. Pass................. Pass................. Pass................ Include.
35300............................. New Haven-Milford, CT..... Pass................. Pass................. Pass................ Include.
35380............................. New Orleans-Metairie, LA.. Pass................. Pass................. Pass................ Include.
35620............................. New York-Newark-Jersey Pass................. Pass................. Pass................ Include.
City, NY-NJ-PA.
35660............................. Niles-Benton Harbor, MI... Pass................. Pass................. Pass................ Include.
35840............................. North Port-Sarasota- Pass................. Pass................. Pass................ Include.
Bradenton, FL.
35980............................. Norwich-New London, CT.... Pass................. Pass................. Pass................ Include.
36100............................. Ocala, FL................. Pass................. Pass................. Fail................ Exclude.
36140............................. Ocean City, NJ............ Fail................. Fail................. Pass................ Exclude.
36220............................. Odessa, TX................ Pass................. Pass................. Pass................ Include.
36260............................. Ogden-Clearfield, UT...... Pass................. Pass................. Pass................ Include.
36420............................. Oklahoma City, OK......... Pass................. Pass................. Pass................ Include.
36500............................. Olympia-Tumwater, WA...... Pass................. Pass................. Pass................ Include.
36540............................. Omaha-Council Bluffs, NE- Pass................. Pass................. Pass................ Include.
IA.
36740............................. Orlando-Kissimmee-Sanford, Pass................. Pass................. Fail................ Exclude.
FL.
36780............................. Oshkosh-Neenah, WI........ Fail................. Fail................. Pass................ Exclude.
36980............................. Owensboro, KY............. Pass................. Pass................. Pass................ Include.
37100............................. Oxnard-Thousand Oaks- Pass................. Pass................. Fail................ Exclude.
Ventura, CA.
37340............................. Palm Bay-Melbourne- Pass................. Pass................. Pass................ Include.
Titusville, FL.
37460............................. Panama City, FL........... Pass................. Pass................. Pass................ Include.
37620............................. Parkersburg-Vienna, WV.... Pass................. Pass................. Pass................ Include.
37860............................. Pensacola-Ferry Pass- Pass................. Pass................. Pass................ Include.
Brent, FL.
37900............................. Peoria, IL................ Pass................. Pass................. Pass................ Include.
37980............................. Philadelphia-Camden- Pass................. Pass................. Pass................ Include.
Wilmington, PA-NJ-DE-MD.
38060............................. Phoenix-Mesa-Scottsdale, Pass................. Pass................. Pass................ Include.
AZ.
38220............................. Pine Bluff, AR............ Fail................. Fail................. Pass................ Exclude.
38300............................. Pittsburgh, PA............ Pass................. Pass................. Pass................ Include.
38340............................. Pittsfield, MA............ Pass................. Fail................. Pass................ Exclude.
38540............................. Pocatello, ID............. Fail................. Fail................. Pass................ Exclude.
38660............................. Ponce, PR................. Fail................. Fail................. Pass................ Exclude.
38860............................. Portland-South Portland, Pass................. Pass................. Pass................ Include.
ME.
38900............................. Portland-Vancouver- Pass................. Pass................. Pass................ Include.
Hillsboro, OR-WA.
38940............................. Port St. Lucie, FL........ Pass................. Pass................. Pass................ Include.
39140............................. Prescott, AZ.............. Pass................. Pass................. Pass................ Include.
39300............................. Providence-Warwick, RI-MA. Pass................. Pass................. Pass................ Include.
[[Page 233]]
39340............................. Provo-Orem, UT............ Pass................. Pass................. Pass................ Include.
39380............................. Pueblo, CO................ Pass................. Pass................. Pass................ Include.
39460............................. Punta Gorda, FL........... Pass................. Pass................. Pass................ Include.
39540............................. Racine, WI................ Fail................. Fail................. Pass................ Exclude.
39580............................. Raleigh, NC............... Pass................. Pass................. Pass................ Include.
39660............................. Rapid City, SD............ Pass................. Pass................. Pass................ Include.
39740............................. Reading, PA............... Pass................. Pass................. Pass................ Include.
39820............................. Redding, CA............... Pass................. Pass................. Pass................ Include.
39900............................. Reno, NV.................. Pass................. Pass................. Pass................ Include.
40060............................. Richmond, VA.............. Pass................. Pass................. Pass................ Include.
40140............................. Riverside-San Bernardino- Pass................. Pass................. Pass................ Include.
Ontario, CA.
40220............................. Roanoke, VA............... Pass................. Pass................. Pass................ Include.
40340............................. Rochester, MN............. Pass................. Pass................. Pass................ Include.
40380............................. Rochester, NY............. Pass................. Pass................. Pass................ Include.
40420............................. Rockford, IL.............. Pass................. Pass................. Pass................ Include.
40580............................. Rocky Mount, NC........... Pass................. Pass................. Pass................ Include.
40660............................. Rome, GA.................. Pass................. Pass................. Pass................ Include.
40900............................. Sacramento--Roseville--Ard Pass................. Pass................. Pass................ Include.
en-Arcade, CA.
40980............................. Saginaw, MI............... Pass................. Pass................. Pass................ Include.
41060............................. St. Cloud, MN............. Pass................. Pass................. Pass................ Include.
41100............................. St. George, UT............ Pass................. Pass................. Pass................ Include.
41140............................. St. Joseph, MO-KS......... Pass................. Pass................. Pass................ Include.
41180............................. St. Louis, MO-IL.......... Pass................. Pass................. Pass................ Include.
41420............................. Salem, OR................. Pass................. Pass................. Pass................ Include.
41500............................. Salinas, CA............... Pass................. Pass................. Pass................ Include.
41540............................. Salisbury, MD-DE.......... Pass................. Pass................. Pass................ Include.
41620............................. Salt Lake City, UT........ Pass................. Pass................. Pass................ Include.
41660............................. San Angelo, TX............ Pass................. Pass................. Pass................ Include.
41700............................. San Antonio-New Braunfels, Pass................. Pass................. Fail................ Exclude.
TX.
41740............................. San Diego-Carlsbad, CA.... Pass................. Pass................. Pass................ Include.
41860............................. San Francisco-Oakland- Pass................. Pass................. Pass................ Include.
Hayward, CA.
41900............................. San Germ[aacute]n, PR..... Fail................. Fail................. Pass................ Exclude.
41940............................. San Jose-Sunnyvale-Santa Pass................. Pass................. Pass................ Include.
Clara, CA.
41980............................. San Juan-Carolina-Caguas, Fail................. Fail................. Pass................ Exclude.
PR.
42020............................. San Luis Obispo-Paso Pass................. Pass................. Pass................ Include.
Robles-Arroyo Grande, CA.
42100............................. Santa Cruz-Watsonville, CA Pass................. Fail................. Fail................ Exclude.
42140............................. Santa Fe, NM.............. Pass................. Pass................. Pass................ Include.
42200............................. Santa Maria-Santa Barbara, Pass................. Pass................. Pass................ Include.
CA.
42220............................. Santa Rosa, CA............ Pass................. Pass................. Pass................ Include.
42340............................. Savannah, GA.............. Pass................. Pass................. Pass................ Include.
42540............................. Scranton--Wilkes-Barre-- Pass................. Pass................. Pass................ Include.
Hazleton, PA.
42660............................. Seattle-Tacoma-Bellevue, Pass................. Pass................. Pass................ Include.
WA.
42680............................. Sebastian-Vero Beach, FL.. Pass................. Pass................. Pass................ Include.
42700............................. Sebring, FL............... Pass................. Pass................. Pass................ Include.
43100............................. Sheboygan, WI............. Fail................. Fail................. Pass................ Exclude.
43300............................. Sherman-Denison, TX....... Pass................. Pass................. Pass................ Include.
43340............................. Shreveport-Bossier City, Pass................. Pass................. Pass................ Include.
LA.
43420............................. Sierra Vista-Douglas, AZ.. Pass................. Fail................. Fail................ Exclude.
43580............................. Sioux City, IA-NE-SD...... Pass................. Pass................. Pass................ Include.
43620............................. Sioux Falls, SD........... Pass................. Pass................. Pass................ Include.
43780............................. South Bend-Mishawaka, IN- Pass................. Fail................. Fail................ Exclude.
MI.
43900............................. Spartanburg, SC........... Pass................. Pass................. Pass................ Include.
44060............................. Spokane-Spokane Valley, WA Pass................. Pass................. Pass................ Include.
44100............................. Springfield, IL........... Pass................. Pass................. Pass................ Include.
44140............................. Springfield, MA........... Pass................. Pass................. Fail................ Exclude.
44180............................. Springfield, MO........... Pass................. Pass................. Pass................ Include.
44220............................. Springfield, OH........... Fail................. Fail................. Pass................ Exclude.
44300............................. State College, PA......... Fail................. Fail................. Pass................ Exclude.
44420............................. Staunton-Waynesboro, VA... Pass................. Pass................. Pass................ Include.
44700............................. Stockton-Lodi, CA......... Pass................. Pass................. Pass................ Include.
44940............................. Sumter, SC................ Fail................. Fail................. Fail................ Exclude.
45060............................. Syracuse, NY.............. Pass................. Pass................. Pass................ Include.
45220............................. Tallahassee, FL........... Pass................. Pass................. Pass................ Include.
45300............................. Tampa-St. Petersburg- Pass................. Pass................. Pass................ Include.
Clearwater, FL.
45460............................. Terre Haute, IN........... Pass................. Pass................. Pass................ Include.
45500............................. Texarkana, TX-AR.......... Pass................. Pass................. Fail................ Exclude.
45540............................. The Villages, FL.......... Pass................. Pass................. Pass................ Include.
45780............................. Toledo, OH................ Pass................. Pass................. Pass................ Include.
[[Page 234]]
45820............................. Topeka, KS................ Pass................. Pass................. Pass................ Include.
45940............................. Trenton, NJ............... Pass................. Pass................. Pass................ Include.
46060............................. Tucson, AZ................ Pass................. Pass................. Pass................ Include.
46140............................. Tulsa, OK................. Pass................. Pass................. Pass................ Include.
46220............................. Tuscaloosa, AL............ Pass................. Pass................. Pass................ Include.
46340............................. Tyler, TX................. Pass................. Pass................. Pass................ Include.
46520............................. Urban Honolulu, HI........ Pass................. Pass................. Pass................ Include.
46540............................. Utica-Rome, NY............ Pass................. Pass................. Pass................ Include.
46660............................. Valdosta, GA.............. Pass................. Fail................. Pass................ Exclude.
46700............................. Vallejo-Fairfield, CA..... Pass................. Fail................. Fail................ Exclude.
47020............................. Victoria, TX.............. Pass................. Pass................. Pass................ Include.
47220............................. Vineland-Bridgeton, NJ.... Pass................. Fail................. Pass................ Exclude.
47260............................. Virginia Beach-Norfolk- Pass................. Pass................. Fail................ Exclude.
Newport News, VA-NC.
47300............................. Visalia-Porterville, CA... Pass................. Pass................. Pass................ Include.
47380............................. Waco, TX.................. Pass................. Pass................. Pass................ Include.
47460............................. Walla Walla, WA........... Fail................. Fail................. Pass................ Exclude.
47580............................. Warner Robins, GA......... Pass................. Pass................. Pass................ Include.
47900............................. Washington-Arlington- Pass................. Pass................. Pass................ Include.
Alexandria, DC-VA-MD-WV.
47940............................. Waterloo-Cedar Falls, IA.. Pass................. Pass................. Pass................ Include.
48060............................. Watertown-Fort Drum, NY... Fail................. Fail................. Pass................ Exclude.
48140............................. Wausau, WI................ Pass................. Pass................. Pass................ Include.
48260............................. Weirton-Steubenville, WV- Pass................. Pass................. Pass................ Include.
OH.
48300............................. Wenatchee, WA............. Pass................. Pass................. Pass................ Include.
48540............................. Wheeling, WV-OH........... Pass................. Pass................. Pass................ Include.
48620............................. Wichita, KS............... Pass................. Pass................. Pass................ Include.
48660............................. Wichita Falls, TX......... Pass................. Fail................. Fail................ Exclude.
48700............................. Williamsport, PA.......... Pass................. Pass................. Pass................ Include.
48900............................. Wilmington, NC............ Pass................. Pass................. Pass................ Include.
49020............................. Winchester, VA-WV......... Pass................. Pass................. Pass................ Include.
49180............................. Winston-Salem, NC......... Pass................. Pass................. Pass................ Include.
49340............................. Worcester, MA-CT.......... Pass................. Pass................. Pass................ Include.
49420............................. Yakima, WA................ Pass................. Pass................. Pass................ Include.
49620............................. York-Hanover, PA.......... Pass................. Pass................. Pass................ Include.
49660............................. Youngstown-Warren- Pass................. Pass................. Pass................ Include.
Boardman, OH-PA.
49700............................. Yuba City, CA............. Pass................. Pass................. Pass................ Include.
49740............................. Yuma, AZ.................. Pass................. Pass................. Pass................ Include.
--------------------------------------------------------------------------------------------------------------------------------------------------------
The following is a summary of the comments received and our
responses.
Comment: The issue of MSA exclusions was a subject raised by a
variety of commenters. Commenters expressed concerns with the
possibility of the same MSAs being selected for inclusion in both the
cardiac EPMs and in the CJR model. Commenters stated that the
introduction of 3 new required models simultaneously in MSAs where CJR
is still in the early stages of implementation would divert
participants' focus from being able to successfully implement CJR and
would pose resource allocation challenges. Commenters stated that
hospitals have a limited capacity to successfully take on new models
and that hospitals could best achieve success when they are allowed to
focus on specific projects. Commenters stated that adding too many
required models will result in diluted resources given to each model
and increased administrative costs to the hospital. One commenter
expressed concern that implementing too many models can compromise both
the success of the models and patient care. Commenters requested that
CMS add an exclusion rule that removes the CJR MSAs from the
possibility of selection as a cardiac EPM area.
Response: We acknowledges the concern of CJR participant hospitals
with respect to having the capacity and ability to take on the new
cardiac and SHFFT episodes in addition to their current model
participation. While recognizing the logistical and resource challenges
of implementing multiple models simultaneously, CMS believes that there
are commonalities between the models that would result in some
efficiencies. For example, experiences in CJR with creating gainsharing
approaches, analyzing claims feeds, and understanding reconciliation
methodologies will be directly transferable to managing the cardiac
episodes.
CMS considered the exclusion of CJR MSAs from the possibility of
selection as a cardiac EPM. The effect of removing the CJR MSAs was
considered relative to a variety of other considerations including the
impact of this removal on the remaining MSAs and whether it would
create a biased pool due to the disproportionate removal of areas with
high episode payments as well as areas with a larger population.
In determining which areas were eligible for selection for CJR,
MSAs were required to have at least 400 LEJRs in the reference year. In
contrast, the equivalent exclusion rule for the cardiac EPMs requires
at least 75 AMI episodes. These two different rules means that the pool
of MSAs eligible for selection as a cardiac EPM contains many smaller
MSAs who were not eligible for selection in CJR. Removing the CJR MSA
would disproportionately remove larger cities from the selection pool
and the pool would be artificially weighted towards MSAs with lower
numbers of
[[Page 235]]
cases. The resulting random selection in this pool would similarly be
over-weighted to select smaller areas with lower numbers of episodes.
MSAs were selected for inclusion in CJR by dividing MSAs into
quartiles based on the MSA average LEJR episode spending. The
likelihood of being selected as a CJR area differed between the
quartiles such that MSAs in the least expensive quartile had a 30%
chance of selection and MSAs in the most expensive quartile had a 45%
chance of selection. Thus, the removal of the CJR MSAs from the cardiac
EPM selection pool would disproportionately leave relatively more
efficient MSAs eligible for selection and remove relatively inefficient
areas. In order to quantify the extent of this potential bias, the
impact of removing the CJR areas was examined relative to the average
MSA spending for AMI episodes. CJR MSAs represented just 12% of MSAs in
the least expensive quartile (9 of 74) but represented 26% of the MSAs
in the most expensive quartile (19 of 74).
In summary, because the CJR MSAs were proportionately underweighted
for more efficient MSAs, and over weighted for more expensive MSAs with
higher LEJR episode payments, their removal resulted in introducing
bias which would result in the selection of more small cities as well
as more efficient cities. This bias to disproportionally select
relatively more efficient MSAs is counter to the overall orientation
that these models are most likely to result in cost savings in
inefficient areas. Furthermore, CMS anticipates that an increase in the
probability of selection in smaller cities may also be problematic to
commenters, many of whom expressed concern with the ability of
hospitals with few cases to succeed under the model.
CMS further notes that a variety of models and efforts are
currently underway with the goal of controlling health care costs.
While this presents an operationally challenging situation, CMS hopes
to be able to assess the extent to which these different models
interact and complement (or compete with) one another. The evaluation
of CJR and the EPMs will include a systematic look at hospital
experiences in regard to model uptake given their range of prior
experience, capabilities, and circumstances.
Comment: One commenter recommended the exclusion of MSAs with less
than 20 CABG episodes per quarter rather than basing the exclusionary
criteria only on AMI volume episode volume.
Response: We continue to have a strong interest in being able to
observe how well EPMs operate in areas with a lower volume of episodes,
and, in particular, the consequences of the model for AMI episodes
where CABG is not commonly performed or where standard practice is to
refer all CABGs outside of the MSA, and consequently, does not find it
appropriate to exclude MSAs on the basis of CABG volume.
Comment: One commenter suggested that MSAs with significant
penetration of Medicare Advantage Plans and considerable ACO activity
be excluded from the possibility of selection. They stated that the
models should be implemented in markets with more limited alternative
payment and/or managed care activity. They suggested that the selection
of MSAs believed to be fully invested in care design efforts would make
it challenging to evaluate whether improvements in efficiency were
related to the EPMs or associated with these other efforts. The
commenter stated that restricting to MSAs with minimal involvement with
other APM would ease both administrative burden and allow for better
results and more accurate reconciliation.
Response: While including MSAs with experience in APMs may pose
challenges to the evaluation in its effort to assess causation, CMS
believes that the exclusion of MSAs who may be relatively more
experienced in care redesign and thus more likely to be able to achieve
success in the models would be undesirable. It would be considered a
positive if participant hospitals are able to leverage the knowledge
and experience of experts in their areas in order to successfully
reduce episode spending in eligible patients. Experience with care
management under managed care or within APMs might be one source of
expertise from which participant hospitals may wish to draw. The
evaluation of EPMs will include an examination of market
characteristics and model activity, so as to explore how the
overlapping nature of these two factors impacts performance.
Comment: One commenter expressed the concern that some hospitals
act as regional referral centers or may otherwise have a large
proportion of the beneficiaries they treat who reside outside of the
MSA where the hospital is located. They expressed concern that it would
be difficult to manage care for these beneficiaries in the post
hospital episode period due to this distance. They requested that MSAs
with a significant percent of cases coming from out of the state be
excluded from the possibility of selection.
Response: We recognize that many hospitals treat patients from a
wide catchment area and that this catchment area may possibly extend
beyond the MSA. This situation is particularly relevant to the CABG
EPM. The management of the beneficiary's recovery in the post hospital
period may be a challenge for some providers. Multiple patient
characteristics, including the physical distance between the
beneficiary and the hospital, will influence both what type of care
redesign approach will be most appropriate and the likelihood that the
approach taken will result in improved efficiency and quality. While
distance may pose a challenge to improving patient coordination, it is
one that many providers have successfully undertaken. Many providers,
including regional referral centers, have been able to form and
maintain relationships with providers outside their communities.
CMS holds that regional referral centers are a critical component
of how CAGB episodes are treated and, as such, are an important part of
the cardiac EPM and to gaining an understanding of the ability of such
participants to manage patient episodes.
Comment: Commenters expressed concern that low-volume hospitals are
included in the models and requested that thresholds be added to remove
low-volume providers from the model. Commenters stated that lower
volume providers are subject to issues of random variation and that the
cost and quality experiences observed in these hospitals may not be due
to efficiencies and care coordination. They stated that smaller
hospitals will be at a disadvantage due to the inability to achieve
stability or predictability due to this variation.
Finally, a commenter noted that they believed that minimum number
of applicable cases is necessary for a hospitals to perform internal
analyses to determine the appropriate strategies to use to successfully
re-engineer care. They stated that having a minimum number of cases is
a key factor in whether or not a facility can be ready for undertaking
bundled payments. Minimal numbers are necessary for generating adequate
levels of involvement in potential partners such as physicians and
post-acute care providers. The commenter proposed that the definitions
of minimal volume used in the payment methodology be used instead as
minimal requirements for hospitals to be required to participate in the
cardiac EPMs.
Response: We acknowledge the fact that hospitals, particularly low-
volume hospitals, may have limited resources to fully engage in care
re-design efforts and, due to the low volume, they are
[[Page 236]]
much more susceptible to wider episode cost fluctuations. We refer
readers to the following sections of this final rule III.D.4.b.(9). of
this final rule for a discussion of how target prices for hospitals
with low volume are determined and to III.D.7.c.(1). of this final rule
for a discussion of low volume hospital protections under the cardiac
EPMs.
The inclusion of low-volume hospitals in the EPMs is consistent
with the goal of evaluating the impact of bundled payment and care
redesign across a broad spectrum of hospitals with varying levels of
infrastructure, care redesign experience, market position, and other
considerations, and circumstances. We are interested in evaluating the
experience of these hospitals in the models as part of our overall
desire to see the impact of an episode payment model in providers who
would not otherwise choose to participate in a model. We would be
concerned that setting a threshold for low volume could result in
hospital gaming in order to be below that threshold and thus be
excluded from the models.
Similar to the CJR model, the design of the EPMs and the inclusion
of low-volume providers within the models reflects our interest in
testing and evaluating the impact of a bundled payment approach for
these procedures in a variety of circumstances, especially among those
hospitals that may not otherwise participate in such a test. The
inclusion of these providers allows CMS to better appreciate and
understand how the models operate as a general payment approach and its
impact across a wide range of hospitals. The impact of EPMs on low-
volume hospitals is of great interest to the evaluation of these
models.
We acknowledge that providers with low volumes of AMI, CABG, or CJR
cases may not find it advantageous to engage in an active way with the
EPMs. We expect that low volume providers may decide that their
resources are better targeted to other efforts because they do not find
the financial incentive present in the EPMs sufficiently strong to
cause them to shift their practice patterns. We believe this choice is
similar in nature to that made as hospitals decide their overall
business strategies and where to focus their attentions.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
exclude MSAs that fail one or more of the following rules:
Exclusion Rule 1: Exclude MSAs with fewer than 75 AMI episodes
(determined as discussed in section III.C. of this final rule).
Exclusion Rule 2: Exclude MSAs with fewer than 75 non-BPCI AMI
episodes in the MSA in the reference year.
Exclusion Rule 3: Exclude MSAs if the number of non-BPCI AMI
episodes calculated under Exclusion Rule 2 is less than 50 percent of
the total number of AMI episodes calculated under Exclusion Rule 1.
As discussed in section III.B.2. of this final rule, the Burlington
Vermont MSA was found to no longer be eligible for possible selection
because of the Vermont All-Payer ACO Model. Thus, 293 MSAs out of 384
total MSAs are eligible for the possibility of selection as a cardiac
EPM area.
b. Selection Approach
We proposed the selection of 98 MSAs for the cardiac EPMs through
the use of simple random selection from the 294 (now 293) eligible
MSAs.
Simple random selection is often considered to be an appropriate
default approach to experimental design unless there is a compelling
reason to depart from it. One common alternative approach is to perform
random selection separately within subgroups. Selection within
subgroups can be a useful approach to limiting differences between
intervention and control groups to improve statistical power or for
facilitating over or under sampling to allow the evaluation to examine
effects of the intervention on particular types of MSAs or because
those types of MSAs are of particular interest for policy reasons.
In CJR, we used a stratified random assignment approach in which we
organized MSAs into strata based on MSA population size and historic
LEJR episode payments. Under the CJR model, we believed a stratified
approach was appropriate due to wide regional variation in prices,
primarily associated with the use of post-acute services. The
stratified approach served as a means to oversample in higher-expense
MSAs as these areas have both the most need for and the most
opportunity under the CJR model.
In assessing whether stratification would be proposed for the EPMs,
we assessed a variety of factors described later in this section.
Absent stratification, the rate at which a particular type of MSA will
appear in the sample will be proportional to how often in appears among
eligible MSAs. If a particular type of MSA is relatively common, it is
likely to occur often enough that we do not need to deliberately over-
sample for it. In the end, our analyses did not provide sufficient
evidence that it is necessary to create selection subgroups of MSAs to
guide the selection approach. As a result, we are proposing to use
simple random selection from the entire pool of eligible MSAs.
(1) Factors Considered but Not Used
We considered a variety of possible MSA characteristics for
possible use in classifying sub-groups. Though we did consider many of
these variables important, we believe that a simple random selection,
where warranted, is preferable.
Some of the factors we considered that we are not proposing to use
in the selection methodology include the following:
Measures associated with AMI-episode and CABG episode
wage-adjusted spending, respectively. In considering how to
operationalize such measures, we considered a number of alternatives
including average total episode spending payments in an MSA, average
episode spending associated with the initial hospital stay(s) and
average episode spending occurring in the period after discharge from
the initial hospital.
Measures associated with variation in practice patterns
associated with AMI and CABG episodes. In considering how to
operationalize this measure, we considered a number of alternatives
including the extent to which both an AMI and a CABG episode are
associated with having a transfer hospital stay at the beginning of the
episode, and the extent to which CABG hospitalizations occur following
a hospital transfer from either within or from outside the same MSA.
Measures associated with relative market share of
providers with respect to AMI and/or CABG episodes, including the
presence or absence of regional referral centers and the number of
providers with the capacity to perform CABGs or otherwise treat complex
cardiac patients.
Health care supply measures of providers in the MSA
including acute or post-acute bed counts, and number of relevant
physician specialties such as cardiologists and cardiothoracic
surgeons.
MSA-level demographic measures such as: (1) Average
income; (2) distributions of population by age, gender or race; (3)
percent dually eligible; and (4) percent with specific health
conditions or other demographic composition measures.
Measures associated with the degree to which a market
might be more capable or ready to implement care-redesign activities.
Examples of market-
[[Page 237]]
level characteristics that might be associated with anticipated ease of
implementation include the MSA-level EHR meaningful-use levels,
managed-care penetration, ACO penetration, and experience with other
bundling efforts.
Though these measures were not proposed to be part of the selection
process, we acknowledge that these and other market-level factors may
be important to the proper understanding of the evaluation of the
impact of EPMs. We intend to consider these and other measures in
determining which MSAs are appropriate comparison markets for the
evaluation and for possible subgroup analysis or risk-adjustment
purposes. The evaluations will include beneficiary-, provider-, and
market-level characteristics in how they will examine the performance
of the proposed EPMs.
The following is a summary of the comments received and our
responses.
Comment: A few commenters expressed general support for the
selection approach. Several commenters identified considerations that
they believed would increase the likelihood of success in these models
and believed that those factors should influence the likelihood of
selection.
One commenter believed that the selection methodology used should
instead select MSAs where there is unwanted clinical or fiscal
variation in care. They stated that the implementation of the cardiac
EPMs in these MSAs would be most likely to target patients who would
benefit from novel care delivery initiatives. In contrast, another
commenter noted that the implementation of the cardiac EPMs in a
variety of markets, including those who are relatively more efficient,
could help with improving care management/coordination overall.
One commenter mentioned that CMS did not incorporate any MSA-level
demographic measures in its selection process, such as distributions of
population by age, gender, or race; percent of population dually
eligible for Medicare and Medicaid; percent of population with specific
health conditions; and other demographic composition measures. They
believed these factors vary not only between MSAs, but also by
hospitals within an MSA, and could affect a hospital's chances of
success in the proposed EPMs.
Response: We appreciate the suggestions of alternative MSA
selection criteria and note that we considered whether to
disproportionately select higher cost areas. As discussed above, the
range of average episode costs between MSAs was relatively narrow and
even relatively efficient MSAs would have opportunity for care redesign
and increased efficiency under these models. The examination of the
distribution of expenses did not seem to indicate that there are
substantial pattern of care differences between MSAs that needed to be
recognized in the selection methodology.
We acknowledge that demographic factors may indeed influence the
ability of hospitals to succeed under the models. However, in creating
the EPMs, we are seeking to understand how the models impact costs and
quality under a variety of circumstances. We seek to understand if the
models work in both more and less challenging circumstances in order to
be able to gain an understanding of successes and failures of the
episodic payment approach in all types of initiating participants. We
did not choose to incorporate MSA level demographics in our selection
methodology but instead we are relying on random selection to include
MSAs with a variety of circumstances. We did not believe it was
necessary to preemptively over-sample areas with a larger percent of
vulnerable patients.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
select MSAs for inclusion in the cardiac EPMs by simple random
selection.
(2) Sample-Size Calculations and the Number of Selected MSAs
Our analyses of the necessary sample size led us to propose the
selection of 98 MSAs, to participate in both the AMI and CABG EPMs. At
the time of the proposed rule 294 MSAs were eligible for selection out
of a total of 384 MSAs. In this section, we discuss the assumptions and
modeling that went into our proposal to test these EPMs in 98 MSAs. The
discussion of the method of selection of these 98 MSAs is addressed in
the following section. In coming to the decision to target 98 MSAs, we
are proposing an approach that limits the size of the intervention to
the greatest degree possible, while still ensuring that we have
sufficient statistical power to reliably evaluate the effects of the
EPMs. Going below this threshold would jeopardize our ability to be
confident in our results and to be able to generalize from the EPMs to
the larger national context.
In calculating the necessary size of the AMI and CABG EPMs, a key
consideration was to have sufficient power to be able to detect the
desired size impact. The larger the anticipated size of the impact, the
fewer MSAs we would have to sample in order to observe it. However, a
model sized to be able to only detect large impacts runs the risk of
not being able to draw conclusions if the size of the change is less
than anticipated. The measure of interest used in estimating sample
size requirements for the both the AMI and the CABG EPMs was wage-
adjusted total episode spending. The data used for the wage-adjusted
total episode spending is the 3-year data pull previously described
that covers AMI and CABG episodes with admission dates from July 1,
2012, through December 31, 2014. For the purposes of the sample-size
calculation, we aim to be able to reliably identify between a 2-percent
and 3-percent reduction in wage-adjusted episode spending after 1 year
of experience. We chose this range because those numbers represent the
anticipated amount of the discount proposed to apply under various
conditions of the AMI and CABG EPMs' implementation.
The next consideration in calculating the necessary sample size is
the degree of certainty we will need for the statistical tests that
will be performed. In selecting the right sample size, there are two
types of errors that need to be considered: ``false positives'' and
``false negatives.'' A false positive occurs if a statistical test
concludes that a model was successful (that is, saved money) when it in
fact was not. A false negative occurs if a statistical test fails to
find statistically-significant evidence that the model was successful,
when it in fact was successful. In considering the minimum sample size
needs of the AMI and CABG EPMs, a standard guideline in the statistical
literature suggests calibrating statistical tests to generate no more
than a 5-percent chance of a false positive and selecting the sample
size to ensure no more than a 20-percent chance of a false negative. In
contrast, the proposed sample size for this project was based on a 10-
percent chance of a false positive and no more than a 30-percent chance
of a false negative in order to minimize reduce sample size
requirements to the greatest degree possible.
A third consideration in the sample-size calculation was the
appropriate unit of selection and whether it is necessary to base the
calculation on the number of MSAs, the number of hospitals, or the
number of episodes. We proposed to base the sample size calculation at
the MSA level. The proposed EPMs are an example of what is known as a
``nested comparative study.'' Under a nested comparative study,
assignment to an intervention or comparison arms of the study is based
on membership in a pre-existing, identifiable group where the groups
are
[[Page 238]]
not formed at random, but rather through some physical, social,
geographic, or other connection among their members. Because these
groups are not formed at random, individual members of each group are
likely to share important commonalities. In the context of the proposed
EPMs, spending and outcomes for patients cared for within a given MSA
are relatively similar to one another due to such factors as the
existence of common practice or referral patterns, the underlying
health in the population, and the availability of providers in an area.
In statistical terms, these commonalities create a positive
correlation (called an intra-class correlation) among hospitals or
beneficiaries in the same MSA. Due to that intra-class correlation, the
variability of any aggregate statistic--such as the estimated
difference in outcomes between the intervention and comparison arms of
the study--has two components--(1) variability attributable to
variation among hospitals or beneficiaries in a given MSA; and (2)
variability attributable to differences between MSAs. An accurate power
analysis must account for both components of variability.
In determining the necessary sample size, we take into
consideration the degree to which commonalities within MSAs exist and
the number of independent beneficiaries and hospitals expected to be
included in the EPMs within each MSA. As part of this process, we
empirically examined the number of beneficiaries, the number of
hospitals, and the number of MSAs, as well as the level of correlation
in episode payments between each level. Based on this empirical
examination, we determined that the correlation was high enough that
the degree of variability would be primarily driven by the number of
MSAs in the model, indicating that the MSA is the appropriate unit of
analysis for the power calculations.
Using the previously mentioned assumptions, a power calculation for
AMI was run which indicated that at 98 MSAs we would be able to
reliably detect a 3-percent reduction in wage-adjusted episode spending
after 1 year with a false-positive rate of 10 percent and a false-
negative rate of between 20 percent and 40 percent. We are targeting a
false-negative rate of 30 percent. The extent to which this rate can be
lowered will depend on the ability of evaluation models to
substantially reduce variation through risk adjustment and modeling. We
believe it is prudent to choose a sample size where the targeted amount
is in the middle of this expected band.
We separately assessed the sample-size needs associated with CABG
episodes. At 98 MSAs, we anticipate being able to detect a 2.25-percent
reduction in wage-adjusted episode expenditures after 1 year with a
false-positive rate of 10 percent and a false-negative rate of between
20-40 percent. The effective number of MSAs where the CABG EPM will be
tested will be reduced because approximately 6 percent of eligible MSAs
had no CABG episodes in the reference year. However, our power
calculations do not lead us to believe we need to increase the sample
size based on this fact. The number of CABG MSAs can experience this
reduction and maintain equivalent levels of power to the AMI episodes.
The following is a summary of the comments received and our
responses.
Comment: One commenter expressed the opinion that the models should
be tested in 5 to 10 MSAs rather than be done as a large scale test.
Response: As stated in the proposed rule, we believe that the
evidence base related to episode payments is sufficient enough to
justify a large scale test and we believe that it is appropriate to
size the models so as to be able to generate statistically reliable
estimates of the impact as well as to be able to understand how well
the models operate in a variety of circumstances.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
select 98 MSAs to participate in the cardiac EPMs.
(3) Method of Selecting MSAs
As previously discussed, we are sought to choose 98 MSAs from our
pool of eligible MSAs through simple random selection. We proposed to
make the selection in the proposed rule using SAS Enterprise Guide 7.1
software to run a computer algorithm SAS Enterprise Guide 7.1 and the
computer algorithm used to conduct selection represents an industry-
standard for generating advanced analytics and provides a rigorous,
standardized tool by which to satisfy the requirements of randomized
selection. The key SAS commands employed include a ``PROC
SURVEYSELECT'' statement coupled with the ``METHOD=SRS'' option used to
specify simple random sampling as the sample selection method. A random
number seed will be generated using the birthdate of the person
executing the program.\39\
---------------------------------------------------------------------------
\39\ For more information on this procedure and the underlying
statistical methodology, please reference SAS support documentation
at: http://support.sas.com/documentation/cdl/en/statug/63033/HTML/default/viewer.htm#statug_surveyselect_sect003.htm/.
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We sought comment on our proposal to implement the AMI and CABG
models in the selected MSAs, some of which may overlap with MSAs where
the CJR and SHFFT models also are being implemented.
The following is a summary of the comments received and our
responses.
Comment: Comments were received from multiple sources that
expressed that the list of selected MSAs be published as soon as
possible to allow for better preparation for the start of the models.
One commenter requested that the list of hospitals in the selected
areas also be published and that hospitals be given 60 days to comment
on its accuracy. Commenters expressed a preference that, in future rule
making of a similar nature, the list of selected MSAs be displayed in
the proposed rule rather than the final rule to allow for comment by
the impacted MSAs and additional preparation time.
Response: We appreciate the suggestion that MSAs and affected
providers be published at the time of rulemaking, and will take it
under advisement in any future rule. One of the reasons for not
selecting MSAs at the time of the proposed rule was to encourage all
potentially impacted providers to comment. In addition, we wished to be
able to maintain flexibility that would allow for the creation of new
exclusion rules to be suggested in the comment period without
necessitating the need to re-select MSAs between the proposed and final
rules. In order to accommodate the later announcement of impacted MSAs,
we proposed a July 1, 2017 model start. This represents a similar
amount of time between the CJR MSA announcement and the start of that
model as for the announcement of the cardiac EPM MSAs and the
finalization of the SHFFT MSAs and the start of those models.
The list of MSAs selected for the cardiac EPM is included in TABLE
2. The list of hospitals identified as in the MSAs selected for the
cardiac EPMs can be found at https://innovation.cms.gov/initiatives/epm/. Hospitals believing that they have erroneously been identified as
being in a selected area should send an email to [email protected] within
45 days of the publication of the final rule. Hospitals should include
identifying information including the hospital CCN. CMS will
periodically review and revise the list of hospitals that meet the
requirements for participation in the cardiac EPMs and
[[Page 239]]
will update this information on https://innovation.cms.gov/initiatives/epm/.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification. We
selected the participating MSAs for the CABG and AMI EPMs through
simple random selection. SAS for Windows Version 9.4 software was used
to run a computer algorithm designed to randomly select MSAs. SAS for
Windows Version 9.4 and the computer algorithm used to conduct
selection represents an industry standard for generating advanced
analytics and provides a rigorous, standardized tool by which to
satisfy the requirements of randomized selection. The key SAS commands
employed include a ``PROC SURVEYSELECT'' statement coupled with the
``METHOD=SRS'' option used to specify simple random sampling as the
sample selection method. The random number seed utilized was 19730609.
The MSAs selected for inclusion are shown in TABLE 2.
Table 2--MSAS Selected To Participate in the Cardiac EPMS
----------------------------------------------------------------------------------------------------------------
CBSA_OMB MSA name CJR selected MSA?
----------------------------------------------------------------------------------------------------------------
10180.......................... Abilene, TX........................................
10420.......................... Akron, OH.......................................... yes.
10780.......................... Alexandria, LA.....................................
10900.......................... Allentown-Bethlehem-Easton, PA-NJ..................
11260.......................... Anchorage, AK......................................
12100.......................... Atlantic City-Hammonton, NJ........................
12220.......................... Auburn-Opelika, AL.................................
12420.......................... Austin-Round Rock, TX.............................. yes.
13380.......................... Bellingham, WA.....................................
13460.......................... Bend-Redmond, OR...................................
14020.......................... Bloomington, IN....................................
14260.......................... Boise City, ID.....................................
14460.......................... Boston-Cambridge-Newton, MA-NH.....................
15940.......................... Canton-Massillon, OH...............................
15980.......................... Cape Coral-Fort Myers, FL..........................
16020.......................... Cape Girardeau, MO-IL.............................. yes.
16300.......................... Cedar Rapids, IA...................................
16700.......................... Charleston-North Charleston, SC....................
16860.......................... Chattanooga, TN-GA.................................
16980.......................... Chicago-Naperville-Elgin, IL-IN-WI.................
17020.......................... Chico, CA..........................................
17660.......................... Coeur d'Alene, ID..................................
17860.......................... Columbia, MO....................................... yes.
17900.......................... Columbia, SC.......................................
17980.......................... Columbus, GA-AL....................................
18880.......................... Crestview-Fort Walton Beach-Destin, FL.............
19100.......................... Dallas-Fort Worth-Arlington, TX....................
19300.......................... Daphne-Fairhope-Foley, AL..........................
19740.......................... Denver-Aurora-Lakewood, CO......................... yes.
19780.......................... Des Moines-West Des Moines, IA.....................
20100.......................... Dover, DE..........................................
20500.......................... Durham-Chapel Hill, NC............................. yes.
21060.......................... Elizabethtown-Fort Knox, KY........................
21500.......................... Erie, PA...........................................
21660.......................... Eugene, OR.........................................
22520.......................... Florence-Muscle Shoals, AL.........................
22660.......................... Fort Collins, CO...................................
23060.......................... Fort Wayne, IN.....................................
23580.......................... Gainesville, GA.................................... yes.
24300.......................... Grand Junction, CO.................................
24860.......................... Greenville-Anderson-Mauldin, SC....................
25940.......................... Hilton Head Island-Bluffton-Beaufort, SC...........
26580.......................... Huntington-Ashland, WV-KY-OH.......................
26820.......................... Idaho Falls, ID....................................
26900.......................... Indianapolis-Carmel-Anderson, IN................... yes.
26980.......................... Iowa City, IA......................................
27620.......................... Jefferson City, MO.................................
27860.......................... Jonesboro, AR......................................
27900.......................... Joplin, MO.........................................
28020.......................... Kalamazoo-Portage, MI..............................
28140.......................... Kansas City, MO-KS................................. yes.
28420.......................... Kennewick-Richland, WA.............................
29100.......................... La Crosse-Onalaska, WI-MN..........................
29420.......................... Lake Havasu City-Kingman, AZ.......................
29460.......................... Lakeland-Winter Haven, FL..........................
29620.......................... Lansing-East Lansing, MI...........................
30460.......................... Lexington-Fayette, KY..............................
30620.......................... Lima, OH...........................................
30780.......................... Little Rock-North Little Rock-Conway, AR...........
[[Page 240]]
31540.......................... Madison, WI........................................ yes.
31700.......................... Manchester-Nashua, NH..............................
32780.......................... Medford, OR........................................
32820.......................... Memphis, TN-MS-AR.................................. yes.
33340.......................... Milwaukee-Waukesha-West Allis, WI.................. yes.
33540.......................... Missoula, MT.......................................
34820.......................... Myrtle Beach-Conway-North Myrtle Beach, SC-NC......
34980.......................... Nashville-Davidson-Murfreesboro-Franklin, TN....... yes.
35100.......................... New Bern, NC.......................................
35660.......................... Niles-Benton Harbor, MI............................
36420.......................... Oklahoma City, OK.................................. yes.
36540.......................... Omaha-Council Bluffs, NE-IA........................
39140.......................... Prescott, AZ.......................................
39380.......................... Pueblo, CO.........................................
39580.......................... Raleigh, NC........................................
39660.......................... Rapid City, SD.....................................
39740.......................... Reading, PA........................................ yes.
39900.......................... Reno, NV...........................................
40060.......................... Richmond, VA.......................................
40220.......................... Roanoke, VA........................................
41100.......................... St. George, UT.....................................
41140.......................... St. Joseph, MO-KS..................................
41420.......................... Salem, OR..........................................
41500.......................... Salinas, CA........................................
42340.......................... Savannah, GA.......................................
43300.......................... Sherman-Denison, TX................................
44060.......................... Spokane-Spokane Valley, WA.........................
44100.......................... Springfield, IL....................................
46060.......................... Tucson, AZ.........................................
46140.......................... Tulsa, OK..........................................
46220.......................... Tuscaloosa, AL..................................... yes.
46540.......................... Utica-Rome, NY.....................................
47940.......................... Waterloo-Cedar Falls, IA...........................
48300.......................... Wenatchee, WA......................................
48620.......................... Wichita, KS........................................ yes.
48900.......................... Wilmington, NC.....................................
49180.......................... Winston-Salem, NC..................................
49660.......................... Youngstown-Warren-Boardman, OH-PA..................
49740.......................... Yuma, AZ...........................................
----------------------------------------------------------------------------------------------------------------
C. Episode Definition for the EPMs
1. Background
Episode payment models incentivize improvement in the coordination
and quality of care experienced by a Medicare beneficiary, as well as
episode efficiency, by bundling payment for services furnished to the
beneficiary for specific clinical conditions over a defined period of
time. A key model design feature is the definition of the episodes
included in the model. The definition of episodes has two significant
dimensions--(1) a clinical dimension that describes which clinical
conditions and associated services are included in the episode; and (2)
a time dimension that describes the beginning, middle, and end of the
episode.
2. Overview of Three Episode Payment Models
We proposed three new EPMs--AMI, CABG, and SHFFT--that each begin
with a hospitalization and extend 90 days after hospital discharge. The
proposed AMI model includes beneficiaries discharged under an AMI MS-
DRG (280-282), representing admission to an IPPS hospital for AMI that
is treated with medical management, or an IPPS admission for a PCI MS-
DRG (246-251) with an International Classification of Diseases (ICD)--
Clinical Modification (CM) AMI diagnosis code describing an initial AMI
diagnosis in the principal or a secondary diagnosis code position.
The proposed CABG model includes beneficiaries discharged under a
CABG MS-DRG (231-236), representing an IPPS admission for this coronary
revascularization procedure irrespective of AMI diagnosis.
The proposed SHFFT model includes beneficiaries discharged under
hip and femur procedures except major joint MS-DRG (480-482),
representing an IPPS admission for a hip fixation procedure in the
setting of a hip fracture.
One reason these particular episodes were chosen for the proposed
EPMs is that the initiation of treatment for each of the three clinical
conditions included in an episode occurs almost exclusively during a
hospitalization, which we believe would minimize the possibility of
shifting beneficiaries in or out of the EPM based on the site-of-
service where treatment is initiated. The majority of evaluation and
treatment for AMI is performed in the inpatient hospital setting,
commonly beginning when beneficiaries present with symptoms to the
emergency department of a hospital. Patients experiencing an AMI are
almost uniformly admitted to the hospital for further evaluation and
management.\40\ Although PCIs can be performed and
[[Page 241]]
may be paid by Medicare in the hospital outpatient setting in addition
to being performed during a hospitalization, the majority of patients
experiencing an AMI who are candidates for procedural revascularization
receive PCI procedures during the initial hospitalization for AMI where
evaluation also occurs.\41\ CABG procedures are furnished exclusively
in the inpatient hospital setting. We note that all of the Current
Procedural Terminology (CPT) codes that physicians report for CABG are
listed on the hospital Outpatient Prospective Payment System (OPPS)
inpatient-only list in Addendum E of the 2017 OPPS final rule with
comment period that is posted on the CMS Web site.\42\ The hip fixation
procedures performed in the SHFFT model also are predominantly
furnished in the inpatient hospital setting, and we further note that
almost all of the CPT codes that describe these procedures also are on
the OPPS inpatient-only list.
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\40\ Amsterdam et al. 2014 AHA/ACC Guideline for the Management
of Patients with Non-ST-Elevation Acute Coronary Syndromes.
Circulation. 2014; 130:e344-e426.
\41\ Episodes for beneficiaries with AMI initiated by all U.S.
IPPS hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in the proposed rule,
that end in CY 2014.
\42\ https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/HospitalOutpatientPPS/Hospital-Outpatient-Regulations-and-Notices-Items/CMS-1656-FC.html.
---------------------------------------------------------------------------
Hospitals' ability to identify EPM beneficiaries during the
hospitalization that begins the episode (hereinafter the anchor
hospitalization) also is an important consideration in developing
episode payment models that, like the CJR model, rely upon MS-DRG
assignment for IPPS claims following their submission in order to
identify beneficiaries for model inclusion. This is especially
important for medical management of conditions for which the
predictability of the ultimate MS-DRG for the hospitalization is less
certain than for surgical or procedural MS-DRGs. AMI represents a
relative exception among medical conditions as it is associated with
specific clinical and laboratory features that enable hospitals to
identify beneficiaries with AMI during the anchor hospitalization whom
would likely be included in an AMI episode through their ultimate
discharge under an AMI MS-DRG. We note that ICD-CM coding rules allow
AMI diagnosis codes in both the primary and secondary position to map
to AMI MS-DRGs.\43\ In the case of procedural episodes such as CABG,
SHFFT, and AMI episodes for beneficiaries treated with PCI, the MS-DRG
for the procedure performed would determine the ultimate MS-DRG
assignment for the hospitalization unless additional surgeries higher
in the MS-DRG hierarchy also are reported.\44\ Therefore, we proposed
these three EPMs for clinical conditions where MS-DRG assignment is
likely to be certain and known during the anchor hospitalization, even
though treatment for AMI may involve only medical management. We
believe hospitals participating in the proposed EPMs would be able to
identify beneficiaries in EPM episodes through their AMI, CABG, and
SHFFT episode MS-DRGs during the anchor hospitalization, allowing
active coordination of EPM beneficiary care during and after
hospitalization.
---------------------------------------------------------------------------
\43\ Medical Severity Diagnosis Related Groups (MS-DRGs):
Definitions Manual. Version 33.0A. 3M Health Information Systems.
(October 1, 2015). https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2016-IPPS-Final-Rule-Home-Page-Items/FY2016-IPPS-Final-Rule-Data-Files.html.
\44\ Medical Severity Diagnosis Related Groups (MS-DRGs):
Definitions Manual. Version 33.0A. 3M Health Information Systems.
(October 1, 2015). https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/AcuteInpatientPPS/FY2016-IPPS-Final-Rule-Home-Page-Items/FY2016-IPPS-Final-Rule-Data-Files.html.
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3. Clinical Dimensions of AMI, CABG, and SHFFT Episodes
As we stated in the CJR Final Rule, we believe that a
straightforward approach for hospitals and other providers to identify
Medicare beneficiaries in these episode payment models would be
important for the care redesign that is required for EPM success, as
well as for operationalization of the proposed payment and other EPM
policies (80 FR 73299). Therefore, as in the CJR model, we proposed
that an EPM episode would be initiated by an admission to an acute care
hospital for an anchor hospitalization paid under EPM-specific MS-DRGs
under the IPPS (80 FR 73300).
The following is a summary of the comments received and our
responses:
Comment: Many commenters expressed support for CMS' proposal to use
many of the BPCI Model 2 and CJR episode parameters to define EPM
episodes because of the provider experience to date with these design
features and their applicability to the clinical conditions that are
the basis of the EPMs. Several commenters specifically recommended that
CMS begin EPM episodes with emergency department care because including
beneficiaries with emergency department care and observation status
would include all beneficiaries with the clinical conditions that were
included in the proposed EPMs. While the commenters acknowledged that
many beneficiaries with the clinical conditions in the EPMs would be
admitted to the hospital, they believe there is a subset of
beneficiaries for whom care could solely be furnished through emergency
department and observation care. Other commenters requested
clarification on how a beneficiary treated in observation status and
then transferred to another hospital would be handled under the EPMs
because the beneficiary would never be assigned to an MS-DRG at the
initial treating hospital. The commenters believe that a hospital could
use this strategy to avoid including high-cost beneficiaries in the
EPMs. The commenters stated that patient stabilization is critical and
the resources needed to care for the beneficiary should not dictate
observation status versus inpatient status due to a hospital
participation in an EPM. Several commenters encouraged CMS to provide
additional guidance on instances when the beneficiary is never admitted
at the initial hospital, but rather transferred from the emergency
department or observation status to another hospital for AMI or CABG.
One commenter recommended that CMS modify the Episode Grouper for
Medicare (EGM) which, to date, has only been considered for resource-
use measurement, to implement advanced APMs designed around EPMs to
correct problems the commenter believes would be present in the
proposed EPMs that would rely on MS-DRGs, including limited severity
adjustment, the limits on who can bear risk, and the inadequate
incentives against complications. The commenter claimed that an acute
care bundle in the hospital setting is important, but so is managing
chronic conditions in an outpatient setting (which often lead to acute
inpatient episodes). While contracting for condition episodes and
procedure episodes separately is feasible and creates a different level
of accountability, the commenter stated that it is even more desirable
to consider contracting for the whole patient; that is, procedure
episodes should be considered downstream events deeply tied to the
effective management of condition episodes. The commenter stated that
the nested construction logic of the EGM was designed with this in
mind.
A commenter contended that the proposed structure for the new EPM
episodes would continue to reward providers for complications. Payments
would be based on the beneficiary's assigned MS-DRG, so a complication
of care could move a low risk patient from a lower paying MS-DRG to a
higher paying MS-DRG that could result in a
[[Page 242]]
significant increase in revenue. The commenter believes the problem is
further compounded because it penalizes providers who invest in quality
improvement. Providers that invest time and resources into care
redesign that successfully reduces complications that influence MS-DRG
assignment do not share in the savings that they generate through their
efforts. The commenter stated that the MS-DRG payment categorization
creates a substantial financial incentive to avoid quality improvement
in favor of focusing on improving the management of adverse events
after they occur. The commenters stated that the benefit of using MS-
DRG assignment in the EPMs could be preserved without the perverse
incentive if the payment group for the episode were assigned based on
an MS-DRG assignment that depended only on diagnosis codes that were
present on admission.
Another commenter claimed that MS-DRGs do not map well to care
delivered in post-acute care settings, especially for chronically ill
beneficiaries. MS-DRGs, in identifying diagnoses and procedures
delivered in the acute care hospital setting, often do not relate to
the skilled nursing needs, functional limitations, or therapy/
rehabilitation focused on in post-acute care settings after hospital
discharge. Additionally, the commenter pointed out that MS-DRGs do not
take into account a patient's functional status, which is an important
indicator for determining a patient's post-acute care needs. The
commenter recommended CMS to develop a more robust risk adjustment
methodology under the EPMs, because MS-DRGs alone are not sufficient
for medically complex patients. For those providers caring for the
sickest beneficiaries, the commenter recommended that CMS create
separate bundled payments for seriously ill beneficiaries, as defined
by something other than MS-DRG.
Response: We appreciate the support that many commenters expressed
for our proposal to identify Medicare beneficiaries included in the
proposed EPMs by their admission to an acute care hospital for a
hospitalization paid under EPM-specific MS-DRGs under the IPPS. We and
many stakeholders have gained substantial experience with bundled
payment models of a similar design under BPCI Model 2 and the CJR
model. We agree with the many commenters who stressed the importance of
EPM participants being able to identify EPM beneficiaries on a timely
basis as early as possible during the episodes in order to maximize the
opportunities for care redesign to improve EPM episode quality and
reduce costs. As we discussed in the proposed rule (81 FR 50813), we
believe that a straightforward approach to EPM model design that would
allow hospitals and other providers to identify Medicare beneficiaries
in these episode payment models would be important for the care
redesign that is required for EPM success, as well as for
operationalization of the proposed payment and other EPM policies, and
agree with many commenters that our proposed design of the EPMs meets
these objectives.
While we acknowledge the perspective of some commenters that a
small number of beneficiaries with clinical conditions that are the
focus of the EPMs, especially AMI, may be appropriately treated in the
emergency department with observation status without hospital
admission, we believe it is infeasible to include these beneficiaries
in the EPMs due to complex operational challenges for CMS and EPM
participants and model design parameters, such as appropriate pricing
in the context of varied hospital cardiac care capabilities. We refer
to section III.C.4.a.(1) of this final rule for further discussion of
comments on outpatient treatment scenarios and our responses. We refer
to section III.C.4.a.(5) of this final rule for discussion of
outpatient-to-inpatient (o-i) transfer scenarios for beneficiaries with
AMI, including when AMI episodes would begin and to which hospital the
episode would be attributed. We agree with the commenters that patient
stabilization of serious conditions such as AMI in the emergency
department of a hospital is critical and the resources needed to care
for the beneficiary should not dictate observation status versus
inpatient status due to a hospital participation in an EPM. We believe
our final EPM policies, including our AMI model transfer policies,
reflect our commitment to ensuring that the initial care of
beneficiaries with urgent conditions such as those targeted by the EPMs
is not influenced by hospital participation in an EPM. We also refer to
sections III.G.4. through 6. of this final rule for discussion of our
monitoring plans to detect changing patterns of care under the EPMs,
including practices that could indicate that medically complex
beneficiaries who otherwise would be expected to be in high-cost EPM
episodes do not initiate EPM episodes.
While we have an interest in future condition-specific episode
payment models and sought public comment on this topic in the proposed
rule (81 FR 50810 through 50811), we have not identified long-term
management of beneficiaries with chronic disease as the focus of these
EPMs, which are proposed to extend 90 days post-hospital discharge from
an anchor hospitalization for beneficiaries who have cardiac or
orthopedic surgery or a cardiac event.
As one commenter pointed out, MS-DRGs currently provide higher
payments for beneficiaries who experience complications during the
inpatient hospitalization and we appreciate the interest of the
commenter in EPMs that encourage improvement in quality of care during
the anchor hospitalization for which hospitals would be rewarded.
However, given the operational challenges that EPMs that require
participation present for EPM participants and CMS, it would be
infeasible in models like the EPMs to regroup beneficiaries to
different MS-DRGs for setting EPM episode prices based only on their
diagnoses that were present on admission to address underlying payment
incentives under the IPPS. Instead, the EPMs focus EPM participants on
care redesign to improve the quality of care for EPM beneficiaries that
may achieve internal hospital cost savings for the anchor
hospitalization and/or savings to Medicare in the post-hospital
discharge period. We expect that some of those care redesign strategies
that improve care coordination for EPM beneficiaries may have spill-
over effects that result in reduced in-hospital complications as well.
Finally, we refer to section III.D.4.b.(2) of this final rule for a
discussion of risk adjustment under the EPMs. Because all EPM
participants care for some seriously ill beneficiaries, some hospitals
may disproportionately care for such beneficiaries due to their service
area, referral patterns, and/or specialized hospital capacity. We
believe appropriate risk adjustment of EPM episode prices, particularly
by performance year 3 when the pricing blend shifts to reflect
predominantly regional pricing, addresses the commenter's concern that
led them to recommend that CMS create separate bundled payments for
seriously ill beneficiaries as defined by something other than MS-DRG
for those providers caring for the sickest patients. While we agree
with the commenter that MS-DRGs only reflect the resources for the
anchor hospitalization and, therefore, do not necessarily reflect the
post-acute care resources required by a beneficiary, we note that the
IPPS payment for the anchor hospitalization is included in the EPM
episode and constitutes, on average, a significant percentage of the
EPM episode spending, specifically 33
[[Page 243]]
percent of AMI episode spending for episodes anchored by AMI MS-DRGs;
58 percent of AMI episode spending for episodes anchored by PCI MS-
DRGs; 63 percent of CABG episode spending; and 27 percent of SHFFT
episode spending.\45\ Thus, we do not believe it is necessary or
appropriate to create separate bundled payments for seriously ill
beneficiaries defined by a grouping other than MS-DRG, because the
specific MS-DRG of the anchor hospitalization determines a significant
percentage of spending for the episode for EPM beneficiaries, including
seriously ill beneficiaries.
---------------------------------------------------------------------------
\45\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated
by all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule that began in CYs 2012-2014.
---------------------------------------------------------------------------
Comment: Several commenters expressed concern about EPM
participants' ability to identify EPM beneficiaries on a timely basis.
The commenters explained that the final MS-DRGs assigned to the
beneficiary's hospitalization is not generated until several days post-
discharge, thus impacting the EPM participant's ability to predict
whether a beneficiary is in or out of an EPM episode at the time the
beneficiary is in the hospital. One commenter added that because the
MS-DRG is assigned to a patient's case upon discharge, it may not be
predictable during a patient's treatment prior to discharge, making it
difficult for providers to implement care redesign targeted to a
patient population identified by MS-DRGs. This commenter believes that
the MS-DRGs assigned to a patient's stay are often inaccurate or
otherwise inappropriate for the patient's diagnosis, making the
classification an inappropriate basis for episode triggers, budgets,
quality measurement and adjusting for underlying patient illnesses.
Another commenter reported on their BPCI Model 2 experience where 70
percent of model beneficiaries were elective admissions, and 30 percent
presented to the hospital through the emergency department. Given that
the proposed EPMs would be more similar to the commenter's experience
with emergency department admissions, the commenter expressed concern
that the EPMs would limit an EPM participant's ability to intervene
with the beneficiary prior to admission and skepticism that the
participant could even identify the beneficiary as being eligible for
the EPM prior to hospital discharge. The commenter added that with very
sick patients, hospitals often must wait for the appropriate coding to
confirm which MS-DRG the patient ultimately is assigned to prior to
billing.
Several commenters further stated that precedence rules among
different models and programs can touch the same beneficiary, and
stated that hospital case managers, nurses, and administrators cannot
know at admission or even before discharge which model the beneficiary
may already be enrolled in or attributed to based on prior utilization.
Response: We appreciate the interest of the commenters in the
timely identification of EPM beneficiaries that would allow EPM
participants the most significant opportunity to influence the care of
these beneficiaries to improve the quality and reduce the cost of EPM
episodes. While we appreciate that many EPM beneficiaries would be
admitted to the hospital on an emergency basis for treatment of hip
fracture, AMI, or CABG surgery under circumstances that would not allow
EPM participants to engage these beneficiaries prior to hospital
admission, we believe that our proposals for the clinical conditions in
the EPMs make identification of most EPM beneficiaries unambiguous
while they are still in the hospital, without a need for hospitals to
wait for coding following discharge to confirm which MS-DRG the patient
ultimately is assigned to for the hospitalization.
As we stated in the proposed rule (81 FR 50829), we agree with the
commenters that hospitals' ability to identify EPM beneficiaries during
the anchor hospitalization is an important consideration in developing
episode payment models that rely upon MS-DRG assignment for IPPS claims
following their submission in order to identify beneficiaries for model
inclusion. We believe the identification of SHFFT and CABG model
beneficiaries should be straightforward for EPM participants because
the relevant MS-DRG assignments directly result from the surgical
procedure performed during the hospitalization and would, therefore, be
accurate. However, identification of beneficiaries for a model focused
on medical management of conditions may be more challenging because the
predictability of the ultimate MS-DRG for the hospitalization is less
certain than for surgical or procedural MS-DRGs. We believe that AMI
represents a relative exception among medical conditions as it is
associated with specific clinical and laboratory features that should
enable hospitals to identify beneficiaries with AMI during the anchor
hospitalization who are treated medically or with PCI and who would
likely be included in an AMI episode through their ultimate discharge
under an AMI MS-DRG. Therefore, we proposed these three EPMs for
clinical conditions where MS-DRG assignment is likely to be certain and
known during the anchor hospitalization, even though treatment for AMI
may involve only medical management. We believe hospitals participating
in the proposed EPMs would generally be able to identify beneficiaries
in EPM episodes through their AMI, CABG, and SHFFT episode MS-DRGs
during the anchor hospitalization, allowing active coordination of EPM
beneficiary care during and after hospitalization.
We refer to section III.D.6.c. of this final rule for discussion of
issues related to beneficiaries whose care could be included in the
EPMs as well as other CMS models and programs.
Comment: One commenter expressed appreciation for CMS' intent to
not have overlap between the same care for a beneficiary in episodes
under more than one EPM. The commenter sought clarification about how
CMS would attribute episodes that originate with one EPM and then cross
over into another EPM. The commenter provided an example of a
beneficiary with a surgical hip fracture who has an AMI during the
hospitalization that is coded in a secondary position, yet the
precipitating event for the hip fracture was through syncope and a
fall.
Response: When an IPPS claim is submitted to Medicare for payment
of a beneficiary's hospitalization, the claim is grouped to an MS-DRG
using the MS-DRG grouper, a software that uses ICD-10-CM diagnosis and
procedures codes submitted on the hospital claim to assign an acute
hospital stay to a particular MS-DRG. Claims are assigned to an MS-DRG
using the grouper effective for the discharge date of the claim. Under
the EPMs, regardless of the chronology and causality of events that led
to the diagnoses and treatment during the hospitalization, we would
rely upon the MS-DRG (and the presence of an ICD-10-CM AMI diagnosis
code on the claim in the case of a PCI MS-DRG) assigned to the claim
following hospital discharge to initiate an EPM episode and define the
EPM to which the beneficiary's care would be attributed. In the
commenter's example in which a patient is admitted to a hospital for
surgical hip fracture fixation and has an AMI during the
hospitalization, the MS-DRG grouper would assign a SHFFT MS-DRG to that
hospitalization. Therefore, the beneficiary would initiate a SHFFT
episode if the hospital is a SHFFT model participant. Regardless of
[[Page 244]]
whether or not the hospital is an AMI model participant, no AMI episode
would be initiated.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal to initiate EPM episodes by an
admission to an acute care hospital for an anchor hospitalization paid
under EPM-specific MS-DRGs under the IPPS, without modification. We
refer to section III.D.4.a.(5) of this final rule for a discussion of
outpatient-to-inpatient and inpatient-to-inpatient transfers between
hospitals under the AMI model. We refer to section III.D.6.c of this
final rule for further discussion of issues related to overlap of
beneficiaries in other Innovation Center models and CMS programs.
a. Definition of the Clinical Conditions Included in AMI, CABG, and
SHFFT Episodes
(1) AMI (Medical Management and PCI) Model
We proposed the AMI model to incentivize improvements in the
coordination and quality of care, as well as episode efficiency, for
beneficiaries treated for AMI with either medical management or
coronary artery revascularization with PCI. We proposed to define
beneficiary inclusion in the AMI model by discharge under an AMI MS-DRG
(280-282), representing those individuals admitted with AMI who receive
medical therapy but no revascularization, and discharge under a PCI MS-
DRG (246-251) with an ICD-10-CM diagnosis code of AMI on the IPPS claim
for the anchor hospitalization in the principal or secondary diagnosis
code position. We note that we would use AMI International
Classification of Diseases, 9th revision clinical modification (ICD-9-
CM) diagnosis codes to identify historical episodes for setting AMI
model-episode benchmark prices in the early performance years of the
AMI model. The Uniform Hospital Discharge Data Set (UHDDS) defines the
principal diagnosis for hospitalization as ``that condition established
after study to be chiefly responsible for occasioning the admission of
the patient to the hospital for care'' and other (secondary) diagnoses
as ``all conditions that coexist at the time of admission, that develop
subsequently, or that affect the treatment received and/or the length
of stay. Diagnoses that relate to an earlier episode which have no
bearing on the current hospital stay are to be excluded.'' \46\ We
proposed to include those beneficiaries discharged under PCI MS-DRGs
with an AMI ICD-10-CM diagnosis code in the principal or secondary
diagnosis code position to ensure that beneficiaries with an AMI that
is not chiefly responsible for occasioning the hospitalization are
included in the AMI model because the AMI itself is likely to
substantially influence the hospitalization and post-discharge recovery
(and be responsible for leading to the PCI) even if an AMI ICD-10-CM
diagnosis code is reported in a secondary diagnosis code position. For
example, a beneficiary receiving a PCI with an ICD-10-CM diagnosis code
of pneumonia in the principal position and an AMI ICD-10-CM diagnosis
code in a secondary position would be included in the AMI model, which
would be appropriate because the course of the beneficiary's recovery
and management during the AMI episode would be primarily associated
with the AMI and PCI. While pneumonia is typically an acute illness
that may sometimes result in hospitalization, underlying chronic
conditions may increase the likelihood that a beneficiary would be
hospitalized for pneumonia, a condition that is more commonly treated
on an outpatient basis. AMI in association with a hospitalization for
pneumonia would represent a sentinel event for the beneficiary
resulting from underlying CAD that signals a need for a heightened
focus on medical management of CAD and other beneficiary risk factors
for future cardiac events that may themselves have increased the
beneficiary's risk for pneumonia. Thus, care coordination and
management in the 90 days post-hospital discharge for these
beneficiaries would be focused on managing CAD and the beneficiary's
cardiac function after the AMI.
---------------------------------------------------------------------------
\46\ http://www.cdc.gov/nchs/data/icd/icd10cm_guidelines_2014.pdf.
---------------------------------------------------------------------------
In the proposed rule (81 FR 50830), we acknowledged that this
proposal to identify beneficiaries included in the AMI model through a
combination of MS-DRGs and AMI ICD-CM diagnosis codes represented a
modification of the CJR episode definition methodology. The CJR model
defined episodes based on MS-DRGs alone, specifically MS-DRG 469 (Major
joint replacement or reattachment of lower extremity with Major
Complications or Comorbidities (MCC)) and MS-DRG 470 (Major joint
replacement or reattachment of lower extremity without MCC), because
the anchor hospitalization for the CJR model was defined by admission
for a surgical procedure alone (80 FR 73280). However, the proposed AMI
episodes would be defined by admission for a medical condition that
includes a range of treatment options, including medical treatment and
PCI. Therefore, to identify beneficiaries admitted for AMI and treated
with PCI requires ICD-CM diagnosis codes paired with MS-DRGs to
identify the subset of PCI MS-DRG cases associated with AMI that would
otherwise be excluded from an AMI model based solely on AMI MS-DRGs.
For the purposes of defining historical AMI episodes, we proposed
to exclude beneficiaries discharged under PCI MS-DRGs with an AMI ICD-
9-CM diagnosis code in the principal or secondary position if there was
an intracardiac ICD-9-CM procedure code in any procedure code field.
Intracardiac procedure codes do not represent PCI procedures indicated
for the treatment of the coronary artery obstruction that results in
AMI, but instead represent a group of procedures indicated for treating
congenital cardiac malformations, cardiac valve disease, and cardiac
arrhythmias. These intracardiac procedures are performed within the
heart chambers rather than PCI procedures for AMI that are performed
within the coronary blood vessels. To reflect this clinical
distinction, the FY 2016 IPPS update removed intracardiac procedures
from MS-DRGs 246-251 and assigned them to new MS-DRGs 273 and 274 (80
FR 49367). Therefore, to be consistent with our proposed definition of
AMI episodes that initiate with PCI MS-DRGs 246-251 (not with MS-DRGs
273 and 274) and an AMI ICD-9-CM diagnosis code in the principal or
secondary position, we proposed to define historical AMI episodes for
beneficiaries discharged under PCI MS-DRGS 246-251 as those that do not
include the ICD-9-CM procedure codes in Table 3. These codes were also
posted on the CMS Web site at https://innovation.cms.gov/initiatives/epm.
[[Page 245]]
Table 3--Proposed ICD-9-CM Procedure Codes in any Position on the IPPS
Claim for PCI MS-DRGS (246-251) That Do Not Define Historical AMI
Episodes
------------------------------------------------------------------------
ICD-9-CM procedure code ICD-9-CM procedure code description
------------------------------------------------------------------------
35.52............................. Repair of atrial septal defect with
prosthesis, closed technique.
35.96............................. Percutaneous balloon valvuloplasty.
35.97............................. Percutaneous mitral valve repair
with implant.
37.26............................. Catheter based invasive
electrophysiologic testing.
37.27............................. Cardiac mapping.
37.34............................. Excision or destruction of other
lesion or tissue of heart,
endovascular approach.
37.36............................. Excision, destruction, or exclusion
of left atrial appendage.
37.90............................. Insertion of left atrial appendage
device.
------------------------------------------------------------------------
In FY 2014, there were approximately 395,000 beneficiaries
discharged from a short-term acute care hospitalization (excluding
Maryland) with an AMI ICD-9-CM diagnosis code in the principal or
secondary position on the IPPS claim. Of these beneficiaries, 58
percent were discharged under MS-DRGs that would initiate an AMI
episode, specifically an AMI MS-DRG (33 percent) and PCI MS-DRG (25
percent). Five percent of beneficiaries were discharged from CABG MS-
DRGs and 3 percent were discharged from AMI MS-DRGs representing death
during the hospitalization. The remaining 34 percent of beneficiaries
with an AMI ICD-CM diagnosis code in the principal or secondary
position were distributed across over approximately 300 other MS-DRGs,
with the septicemia MS-DRGs accounting for 8 percent and the remainder
accounting for 3 percent or less of beneficiaries with an AMI ICD-CM
diagnosis code on the IPPS claim.\47\ We note that the AMI ICD-9-CM
diagnosis code was most commonly in a secondary position for discharges
from these other MS-DRGs, likely representing beneficiaries
hospitalized for another condition who experienced an AMI during that
hospitalization. We further note that CMS' AMI quality measures used in
the Hospital Inpatient Quality Reporting (HIQR) Program are based on
all beneficiaries discharged under any MS-DRG who have an AMI ICD-CM
diagnosis code only in the principal position, reflecting the measures'
focus on the most homogeneous beneficiary population with AMI as the
condition responsible for occasioning the hospital admission. This is
in contrast with our proposed use of an AMI ICD-10-CM diagnosis code in
the principal or a secondary position for the AMI model in order to
identify those beneficiaries receiving a PCI whose hospitalization and
post-discharge recovery and management would primarily be associated
with the PCI and AMI.
---------------------------------------------------------------------------
\47\ Inpatient claims from all U.S. IPPS hospitals not in
Maryland were derived from the October 2013--September 2014
Inpatient Claims File located in the Chronic Conditions Warehouse.
---------------------------------------------------------------------------
The proposed specifications for AMI episodes, including ICD-9-CM
AMI diagnosis codes for historical episodes used to set the initial AMI
model-episode benchmark prices and ICD-10-CM AMI diagnosis codes for
the performance years of the model, are displayed in Table 5. The
proposed ICD-9-CM intracardiac procedure codes used to exclude
inpatient claims with PCI MS-DRGs 246-251 from anchoring AMI model
historical episodes used to set initial AMI model-episode benchmark
prices are displayed in Table 3.
Based on Medicare claims data for historical AMI episodes ending in
CYs 2012-2014, the annual number of potentially eligible beneficiary
discharges for the AMI model nationally was approximately 168,000.\48\
This number was less than the approximately 229,000 discharges for
beneficiaries with AMI discharged from AMI MS-DRGs 280-282 and PCI MS-
DRGs 246-251 that could be expected to be included in the AMI model for
several reasons. Discharges did not result in historical episodes when
a beneficiary did not meet the beneficiary care inclusion criteria
discussed in section III.C.4.a.(1) of the proposed rule (81 FR 50834);
was not discharged alive from PCI MS-DRGs 246-251; was discharged from
a transfer hospital during a chained anchor hospitalization; or was
discharged from a readmission during an AMI episode that did not
initiate new model episodes.
---------------------------------------------------------------------------
\48\ Episodes for AMI beneficiaries initiated by all U.S. IPPS
hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in the proposed rule
that began in CYs 2012-2014.
---------------------------------------------------------------------------
The list of ICD-9-CM and ICD-10-CM AMI diagnosis codes used to
identify beneficiaries discharged under a PCI MS-DRG (MS-DRGs 246-251)
in historical episodes and during the performance years of the model
that would be included in the AMI episodes were discussed in section
III.C.4.a.(2) of the proposed rule (81 FR 50834 through 50835). To make
changes to this list as necessary based on annual ICD-10-CM coding
changes or to address issues raised by the public throughout the EPM
performance years, we proposed implementing the following sub-
regulatory process, which mirrors the sub-regulatory process as
described in the CJR Final Rule for updating hip fracture ICD-9-CM and
ICD-10-CM diagnosis codes (80 FR 73340) and for updating the exclusion
list (80 FR 73305 and 73315). We proposed to use this process on an
annual, or more frequent, basis to update the AMI ICD-10-CM diagnosis
code list and to address issues raised by the public. As part of this
process, we proposed the following standard when revising the list of
ICD-10-CM diagnosis codes representing AMI: The ICD-10-CM diagnosis
code is sufficiently specific that it represents an AMI. We proposed to
then post a list of potential AMI ICD-10-CM diagnosis codes to the CMS
Web site at https://innovation.cms.gov/initiatives/epm to allow for
public input on our planned application of these standards, and then
adopt the AMI ICD-10-CM diagnosis code list with posting to the CMS Web
site of the final AMI ICD-CM diagnosis code list after our
consideration of the public input. We would provide sufficient time for
public input based on the complexity of potential revisions under
consideration, typically at least 30 days, and, while we would not
respond to individual comments as would be required in a regulatory
process, we could discuss the reasons for our decisions about changes
in response to public input with interested stakeholders.
The proposals for identifying the beneficiaries included in the AMI
model and the sub-regulatory process for updating the AMI ICD-10-CM
diagnosis code list were included in proposed Sec. 512.100(c)(1) and
(d), respectively. We sought comment on our proposals to identify
beneficiaries included in the AMI model and the sub-regulatory process
for updating the AMI ICD-10-
[[Page 246]]
CM diagnosis code list. The proposal to exclude inpatient claims with
PCI MS-DRGS 246-251 from anchoring AMI model historical episodes used
to set initial AMI model-episode benchmark prices when there was an
ICD-9-CM intracardiac procedure code on the claim was included in
proposed Sec. 512.100(d)(4). We sought comment on our proposal to
exclude inpatient claims with PCI MS-DRGS 246-251 from anchoring AMI
model historical episodes used to set initial AMI model-episode
benchmark prices when there was an ICD-9-CM intracardiac procedure code
on the claim.
We received no comments on the proposed sub-regulatory process for
updating the AMI ICD-10-CM diagnosis code list. The following is a
summary of the comments received on the other AMI model proposals to
define the included clinical conditions and our responses.
Comment: Several commenters expressed concern that the AMI model
would be so heavily reliant upon coding that creates an artificial
clinical population which is so heterogeneous as to make clinical care
redesign efforts nonspecific and likely ineffective. They contended
that while EPMs based on surgical MS-DRGs streamline patient
identification and inclusion, the AMI model would depend on multiple
levels of coding, both ICD-10-CM and MS-DRGs. One commenter explained
that an important distinction between medical diagnosis and procedural-
based episode-of-care models is that medical diagnosis models tend to
involve a patient population of greater complexity, often with life-
threating conditions. The commenter believes that, where appropriate,
this awareness should be reflected in the design of the EPMs. The
commenters were concerned that the proposed AMI model would put a
greater emphasis on coding methodologies and increase the chance of
disparities between cases identified by each responsible hospital for
inclusion in the AMI model versus cases identified by CMS from
historical claims data upon which quality-adjusted target prices would
be based. The commenters stressed the need for CMS to establish
clinical homogeneity in the AMI model, limiting ambiguity as much as
possible.
Several commenters recommended CMS to use ICD-10-CM coding
strategies to limit inclusion of AMI model beneficiaries to the most
clinically similar subset of beneficiaries in order to allow for
meaningful comparisons and ultimately provide CMS the opportunity to
clearly evaluate the impact of the AMI model on patient care and
outcomes. The commenters stated that with the move from ICD-9-CM to
ICD-10-CM, the coding stages associated with AMI have changed,
warranting additional considerations. Specifically, a number of
commenters recommended that CMS limit the AMI model to beneficiaries
with ST-elevation myocardial infarction (STEMI) discharged under AMI
MS-DRGs and PCI MS-DRGs with an AMI ICD-10-CM code only in the
principal diagnosis code position on the inpatient claim. The
commenters claimed that while STEMIs occur due to an acute coronary
artery occlusion, many non-ST elevation (NSTEMI) beneficiaries with AMI
experience open coronary arteries but there is an imbalance between the
oxygen demands of the heart and the coronary arteries' ability to meet
them. The commenters added that due to these substantial differences in
the underlying pathophysiology of STEMI and NSTEMI AMI patients that
lead to more variation in clinical presentation in NSTEMI patients, in
addition to the different approaches to their evaluation and
management, the AMI model should only include STEMI beneficiaries
which, when risk adjustment is applied, represent a more homogenous
population compared to NSTEMI patients.
These commenters presented the most current consensus driven
definition of AMI, the third universal definition, as: ``Evidence of
myocardial necrosis consistent with acute myocardial ischemia. Under
these conditions, any one of the following criteria meets the diagnosis
for MI:
Detection of a rise and/or fall of cardiac biomarker
values, preferably cardiac troponin with at least one value above the
99th percentile upper reference limit; and at least one of the
following:
Symptoms of new ischemia;
New or presumed new significant ST-segment-T wave (ST-T)
changes or new left bundled branch block (LBBB);
Development of pathological Q waves in the ECG;
Imaging evidence of new loss of viable myocardium or new
regional wall motion abnormality; and
Identification of an intracoronary thrombus by angiography
or autopsy.'' \49\
---------------------------------------------------------------------------
\49\ Thygesen K., Alpert J.S., Jaffe A.S., et al and the Writing
Group on behalf of the Joint ESC/ACCF/AHA/WHF Task Force for the
Universal Definition of Myocardial Infarction. Circulation.
2012;126:2020-2035.
---------------------------------------------------------------------------
The commenters recommended CMS to clearly define AMI for the EPM
because they claimed that currently what is coded as AMI often only
meets this definition in part and may be limited to abnormal biomarkers
that can be detected without an acute occlusion of a coronary artery.
Aligning coding with clinical reality is necessary for establishing
clinical homogeneity in the AMI model. The commenters believe that
including in the AMI model beneficiaries not only with a principal but
a secondary diagnosis of AMI would make it difficult to establish a
clearly defined clinically homogeneous population for the following
reasons:
Critically ill patients often receive a secondary
diagnosis of AMI for what is more correctly characterized as supply-
demand ischemia due to the routine and inaccurate coding of any
troponin leak or elevation as an AMI, despite the absence of a clinical
event suggestive of infarction. The commenters provided examples such
as a beneficiary with metastatic breast cancer and internal bleeding
who exhibits a slight cardiac troponin leak or a beneficiary with
multi-organ failure, stating that the root cause of small elevation of
troponin in these cases would be the underlying condition, not CAD.
They also claimed that elderly patients with heart failure or rapid
atrial fibrillation may have a secondary AMI ICD-CM diagnosis, yet the
heart failure or atrial fibrillation would drive decisions about care,
not the AMI.
Outcomes and cost-of-care for critically ill patients with
a secondary AMI diagnosis are likely driven more by the primary
condition than by AMI resulting from possible CAD.
Patterns of care are very different for patients with a
secondary, as compared to a principal, diagnosis of AMI; and
Including patients with a secondary diagnosis of AMI
increases the variability within the AMI model, limiting opportunity to
draw clear conclusions when testing the model.
One commenter requested that CMS account for beneficiaries with AMI
who do not have a traditional AMI but coding results in discharge under
an AMI MS-DRG by specifying a concrete list of ICD-10-CM codes that, if
included on a claim for a beneficiary discharged under an AMI MS-DRG
from an AMI model participant, would exclude the beneficiary from the
AMI model.
Response: We appreciate the suggestions of the commenters that we
include a more homogeneous group of beneficiaries in the AMI model by
limiting the model to those beneficiaries with a STEMI ICD-CM diagnosis
code in the principal position on the claim for the anchor
hospitalization. Under our proposal to include all beneficiaries
[[Page 247]]
in the AMI model discharged from AMI MS-DRGs and beneficiaries
discharged from PCI MS-DRGs with an AMI ICD-CM diagnosis code listed in
Table 3 (the codes we are finalizing are listed in Table 4) in the
principal or a secondary position on the inpatient claim for the anchor
hospitalization, all of the diagnosis codes except 410.71
(Subendocardial infarction, initial episode of care) in ICD-9-CM and
121.4 (Non-ST elevation (NSTEMI) myocardial infarction) and 122.2
(Subsequent non-ST elevation (NSTEMI) myocardial infarction) are for
STEMI diagnoses. We analyzed historical AMI episodes from 2012-2014 and
found that about 78 percent of episodes were for NSTEMI, while 22
percent were for STEMI.\50\ There are well-established clinical
guidelines for the management of beneficiaries with both NSTEMI and
STEMI, and the clinical care pathways generally differ for these
beneficiaries.51 52 However, to limit the AMI model to
beneficiaries with STEMI only, the minority of beneficiaries with AMI
whose care is less varied, and exclude beneficiaries with NSTEMI, the
majority of beneficiaries with AMI whose care is more varied and highly
dependent on the beneficiary's risk factors for adverse outcomes, would
miss a substantial opportunity to test an EPM for a large proportion of
Medicare beneficiaries with AMI. We believe there are substantial
opportunities for care redesign under the AMI model to improve the
quality and efficiency of episode care for both NSTEMI and STEMI
patients so we will not limit the model to one subgroup of
beneficiaries hospitalized for treatment of AMI. In response to the
commenters who were concerned that including beneficiaries with NSTEMI
and STEMI in the AMI model could interfere with CMS' ability to
evaluate the impact of the AMI model on patient care and outcomes, we
note that as discussed in section IV. of this final rule, we will
examine the impact of the AMI model on subgroups of beneficiaries to
better understand variations in payments and outcomes within and
between hospitals. The identification of subgroups to be examined will
include a variety of key clinical and demographic factors.
---------------------------------------------------------------------------
\50\ Episodes for AMI beneficiaries initiated by all U.S. IPPS
hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in this rule that
began in CYs 2012-2014.
\51\ Amsterdam EA, Wenger NK, Brindis RG, Casey DE Jr, Ganiats
TG, Holmes DR Jr, Jaffe AS, Jneid H, Kelly RF, Kontos MC, Levine GN,
Liebson PR, Mukherjee D, Peterson ED, Sabatine MS, Smalling RW,
Zieman SJ. 2014 ACC/AHA guideline for the management of patients
with non-ST-elevation acute coronary syndromes: a report of the
American College of Cardiology/American Heart Association Task Force
on Practice Guidelines. Circulation. 2014;130:e344-e426.
\52\ O'Gara PT, Kushner FG, Ascheim DD, Casey DE Jr, Chung MK,
de Lemos JA, Ettinger SM, Fang JC, Fesmire FM, Franklin BA, Granger
CB, Krumholz HM, Linderbaum JA, Morrow DA, Newby LK, Ornato JP, Ou
N, Radford MJ, Tamis-Holland JE, Tommaso CL, Tracy CM, Woo YJ, Zhao
DX. 2013 ACCF/AHA guideline for the management of ST-elevation
myocardial infarction: a report of the American College of
Cardiology Foundation/American Heart Association Task Force on
Practice Guidelines. Circulation. 2013;127.
---------------------------------------------------------------------------
We also analyzed the distribution of AMI ICD-9-CM diagnosis codes
for FY 2014 discharges from AMI and PCI MS-DRGs (ICD-10-CM was not in
use in that year) in the principal versus secondary position for
beneficiaries who would be included in the AMI model under our proposal
because of their assignment to an AMI MS-DRG or to a PCI MS-DRG.\53\ We
found that 94 percent of historical episodes assigned to PCI MS-DRGs
had an AMI ICD-9-CM diagnosis code in the principal position. Of those
episodes with an AMI ICD-9-CM diagnosis code in the secondary position,
the most common principal diagnoses were 996.72 (Other complications
due to other cardiac device, implant, and graft) and 414.01 (Coronary
atherosclerosis of native coronary artery), which constituted 53
percent of cases with an AMI ICD-9-CM diagnosis code only in a
secondary position, while the remaining episodes had one of over 200
different ICD-9-CM diagnoses codes in the principal position. In
addition, we found that 86 percent of episodes assigned to AMI MS-DRGs
had an AMI ICD-9-CM diagnosis code in the principal position. Of those
cases with an AMI ICD-9-CM diagnosis code in the secondary position,
the most common principal diagnoses in descending order of frequency
were 428.23 (Acute on chronic systolic heart failure); 427.31 (Atrial
fibrillation); 428.33 (Acute on chronic diastolic heart failure);
428.43 (Acute on chronic combined systolic and diastolic heart
failure); 428.0 (Congestive heart failure, unspecified); and 428.21
(Acute systolic heart failure). These diagnoses constituted 62 percent
of cases with an AMI ICD-9-CM code only in a secondary position, while
the remaining episodes had one of over 200 different, but primarily
cardiac, ICD-9-CM diagnoses codes in the principal position. We note
that the diagnosis code patterns we observed did not confirm the views
of some commenters that beneficiaries with underlying non-cardiac
disease and a troponin leak, such as a metastatic breast cancer with
internal bleeding, would be included in the AMI model based on our
proposal. However, the AMI model would include some beneficiaries
discharged from AMI MS-DRGs with significant underlying cardiac
conditions such as heart failure and atrial fibrillation in the
principal diagnosis code position, another example provided by some
commenters.
---------------------------------------------------------------------------
\53\ Inpatient claims from all U.S. IPPS hospitals not in
Maryland were derived from the October 2013-September 2014 Inpatient
Claims File located in the Chronic Conditions Warehouse.
---------------------------------------------------------------------------
ICD-CM diagnosis coding does not rely on clinical definitions; it
is the physician who is responsible for documenting the patient's
diagnosis. In other words, coders cannot determine if a patient
suffered an AMI based on cardiac biomarkers. If the physician documents
an AMI, then the coder is required to report the ICD-10-CM code
describing the type of AMI. The coder does not interpret the troponin
levels of a beneficiary.
Based on our analysis of historical claims and the established
rules for medical coding, we believe that it is appropriate to include
the small percentage of beneficiaries with an ICD-CM AMI diagnosis code
only in the secondary position upon discharge from AMI and PCI MS-DRGs
in the AMI model because the principal diagnoses on these claims
generally represent beneficiaries with coronary obstruction. The
secondary AMI diagnosis on the claim would have resulted from a
physician diagnosis of AMI which, as the commenters stated, should be
represented by changes in cardiac biomarker values and at least one
other characteristic of a specified list. In addition to representing a
reasonably homogeneous population, we believe this approach provides an
unambiguous definition for AMI model participants to use to identify
beneficiaries discharged from PCI MS-DRGs who would be in the AMI
model. Because the model is focused on a condition, AMI, rather than a
procedure, and some beneficiaries admitted for PCI will not have an
AMI, it is necessary for PCI MS-DRGs to pair ICD-CM diagnosis codes
with the MS-DRG to identify AMI model beneficiaries.
While we observed that 14 percent of beneficiaries assigned to AMI
MS-DRGs only had an AMI ICD-9-CM diagnosis code in the secondary
position and most commonly another cardiac diagnosis in the principal
position, this group is a small minority of beneficiaries discharged
from AMI MS-DRGs. We do not believe that it is necessary to exclude
these beneficiaries from the AMI model for purposes of clinical
homogeneity because the beneficiaries should have had an AMI documented
by a physician for an AMI diagnosis
[[Page 248]]
code to be included in a secondary position on the hospital claim. We
further observed from our analysis of FY 2014 claims for discharges
from AMI MS-DRGs that those beneficiaries with an AMI ICD-9-CM code in
the principal position commonly had similar cardiac diagnoses (for
example, atrial fibrillation and heart failure) as those beneficiaries
where the order of diagnosis coding was reversed.\54\ Care coordination
and management of other cardiac conditions which would be included in
the AMI episode definition as discussed in section III.C.3.b. of this
final rule would be common for beneficiaries discharged from AMI MS-
DRGs, regardless of whether AMI is the principal or a secondary
diagnosis on the hospital claim that led to the beneficiary's discharge
from an AMI MS-DRG. Therefore, limiting the AMI model beneficiaries
only to those assigned to AMI MS-DRGs based on a principal diagnosis
code of AMI would not significantly increase clinical homogeneity of
those AMI model beneficiaries discharged after medical treatment for
AMI. Moreover, to exclude beneficiaries discharged from AMI MS-DRGs
with an AMI ICD-9-CM diagnosis code only in a secondary position on the
hospital claim from the model could substantially complicate timely EPM
participant identification of the beneficiaries in the model by
including only a subset of beneficiaries assigned to AMI MS-DRGs upon
discharge. Thus, we do not believe it is necessary for AMI MS-DRGs to
pair AMI ICD-CM diagnosis codes with the MS-DRG to identify AMI model
beneficiaries.
---------------------------------------------------------------------------
\54\ Inpatient claims from all U.S. IPPS hospitals not in
Maryland were derived from the October 2013-September 2014 Inpatient
Claims File located in the Chronic Conditions Warehouse.
---------------------------------------------------------------------------
Comment: In addition to the commenters who recommended that CMS
apply specific coding strategies to increase clinical homogeneity of
beneficiaries in AMI episodes, other commenters recommended that CMS
exclude a variety of beneficiaries who would otherwise meet the
proposed AMI model criteria for inclusion. Some commenters further
recommended CMS to make a pricing adjustment for AMI episodes for these
beneficiaries if CMS does not exclude them from the model altogether.
Suggestions included excluding beneficiaries who are in the following
clinical scenarios:
Cardiogenic shock or, at a minimum, the subset of
beneficiaries with cardiogenic shock who are transferred from an AMI
model participant or who are transferred to an AMI model participant,
as the impact of the AMI model on transfer decisions could delay access
to life-saving therapies at specialized centers.
Sepsis who do not have clinically traditional AMI and
would not be expected to follow a typical clinical pathway for AMI.
Experiencing a second or greater AMI, who are more likely
to have complex cardiac needs beyond immediate management of the AMI.
Undergoing organ transplantation or ventricular assist
device (VAD) implantation during the episode, because regional pricing
could limit access to life-saving therapies only available at those few
centers capable of caring for advanced heart failure patients and organ
transplant candidates.
Receiving outpatient inotropes for advanced heart failure
during AMI episodes, because these therapies allow beneficiaries to
avoid a surgical bridge to transplant with VAD implantation but are
used in a group of beneficiaries who might otherwise receive a VAD. The
commenters believes this would be consistent with excluding
beneficiaries who receive VAD during AMI episodes from the AMI model.
Undergoing CABG or other cardiac surgery within 90 days
following discharge from the hospitalization for AMI because they must
be medically optimized prior to surgery to ensure safe outcomes. This
percentage of beneficiaries is higher for certain hospitals with
complex patient populations, and the proposed payment methodology would
not adequately account for these high-cost cases.
Response: We appreciate the recommendations of the commenters
regarding the exclusion of certain complex, potentially high-cost
beneficiaries from the AMI model. We do not believe it would be
appropriate to exclude beneficiaries experiencing cardiogenic shock or
a second or subsequent AMI from the AMI model because there are
significant opportunities for improving the quality and efficiency of
care for these beneficiaries during episodes, despite their greater
complexity and medical needs, and we believe it is important to include
these beneficiaries in the test of the AMI model. In response to the
commenters who recommended that we exclude beneficiaries with sepsis
and atypical AMI from the AMI model, based on our proposed definition
of the beneficiaries to be included in the AMI model and the ICD-CM
diagnosis code analysis discussed in the response to the previous
comment, we do not believe that beneficiaries with sepsis and
clinically atypical AMI would generally be included in the AMI model
because they would not be assigned to AMI or PCI MS-DRGs.
While readmission for cardiac transplantation or VAD implantation
would be excluded from AMI episodes based on our proposed AMI model
exclusion list, these beneficiaries would otherwise initiate and remain
in AMI episodes throughout the 90-day post-discharge period both before
and following cardiac transplantation or VAD implantation that occurs
during the 90-day period. Other readmissions and Part B services
furnished to these beneficiaries would be included in the episodes
based on the proposed exclusion list. We believe it is important to
include in the AMI model these beneficiaries with complex care needs
following hospitalization for AMI, including those receiving outpatient
inotropes during AMI episodes, because there are opportunities to
improve the quality and efficiency of their care, despite their
experiencing severe sequelae following AMI.
Finally, we note that we also do not believe it would be
appropriate to exclude from the AMI model those beneficiaries receiving
CABG or other cardiac surgery during AMI episodes after a period of
medical optimization following discharge from the anchor
hospitalization. As discussed in section III.D.4.b.(2)(c) of this final
rule, we are providing a pricing adjustment for AMI episodes with a
CABG readmission for beneficiaries who follow this medically
appropriate clinical pathway. We refer to section III.D.4.b.(2) of this
final rule for further discussion of risk adjustment in the context of
the AMI model's implementation of downside risk and progression to
regional pricing for AMI episodes.
Comment: Several commenters supported excluding intracardiac
valvular and ablation procedures from historical AMI episodes for
clinical consistency between historical AMI episodes and those during
the AMI model performance years. They explained that intracardiac
valvular and ablation procedures are typically unrelated to management
of an AMI but would historically have substantially impacted the total
spending in historical AMI episodes for beneficiaries discharged from
MS-DRGs 246 through 251 in centers that performed those procedures.
Response: We appreciate the support from the commenters. We
continue to believe it is appropriate to define historical AMI episodes
for beneficiaries discharged under PCI MS-DRGS 246-251 as those that do
not include the ICD-9-CM procedure codes in Table 4.
[[Page 249]]
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.100(c)(1) to
include the care of beneficiaries in the AMI model who meet the general
beneficiary care inclusion criteria as discussed in section
III.C.4.a.(1) of this final rule and who are discharged under an AMI
MS-DRG (280-282), representing those individuals admitted with AMI who
receive medical therapy but no revascularization, or discharged under a
PCI MS-DRG (246-251) with an ICD-10-CM diagnosis code of AMI as
displayed in Table 6 on the IPPS claim for the anchor hospitalization
in the principal or secondary diagnosis code position, without
modification.
We are also finalizing the proposals in Sec. 512.100(d)(4) to
define historical AMI episodes for beneficiaries discharged under PCI
MS-DRGS 246-251 as those that do not include the ICD-9-CM procedure
codes in Table 4, without modification.
Table 4--Final ICD-9-CM Procedure Codes in any Position on the IPPS
Claim for PCI MS-DRGS (246-251) That Do Not Define Historical AMI
Episodes
------------------------------------------------------------------------
ICD-9-CM procedure code ICD-9-CM procedure code description
------------------------------------------------------------------------
35.52............................. Repair of atrial septal defect with
prosthesis, closed technique.
35.96............................. Percutaneous balloon valvuloplasty.
35.97............................. Percutaneous mitral valve repair
with implant.
37.26............................. Catheter based invasive
electrophysiologic testing.
37.27............................. Cardiac mapping.
37.34............................. Excision or destruction of other
lesion or tissue of heart,
endovascular approach.
37.36............................. Excision, destruction, or exclusion
of left atrial appendage.
37.90............................. Insertion of left atrial appendage
device.
------------------------------------------------------------------------
Finally, we are finalizing the proposals in Sec. 512.100(d)(1)-(3)
for the sub-regulatory process to be used on an annual, or more
frequent, basis to update the AMI ICD-10-CM diagnosis code list and to
address issues related to AMI diagnosis codes raised by the public,
without modification. As part of this process, we will use the
following standard when revising the list of ICD-10-CM diagnosis codes
representing AMI: The ICD-10-CM diagnosis code is sufficiently specific
that it represents an AMI. We will post a list of potential AMI ICD-10-
CM diagnosis codes to the CMS Web site at https://innovation.cms.gov/initiatives/epm to allow for public input on our planned application of
the standard, and then adopt the AMI ICD-10-CM diagnosis code list with
posting to the CMS Web site of the final AMI ICD-CM diagnosis code list
after our consideration of the public input. We will provide sufficient
time for public input based on the complexity of potential revisions
under consideration, typically at least 30 days, and, while we will not
respond to individual comments as would be required in a regulatory
process, we can discuss the reasons for our decisions about changes in
response to public input with interested stakeholders.
We note that we reviewed the FY 2017 ICD-10-CM diagnosis code
changes that became available after publication of the EPM proposed
rule in the Federal Register on August 2, 2016. There are no changes or
additions to the ICD-10-CM diagnosis codes reporting AMI for FY 2017 so
we are not suggesting modifications for FY 2017 to the final list
displayed in Table 6 of ICD-10-CM AMI diagnosis codes in the principal
or secondary position on the IPPS claim for PCI MS-DRGs (246-251) that
initiate AMI episodes. Thus, we are not initiating a sub-regulatory
update process for FY 2017 AMI ICD-10-CM diagnosis code updates at this
time.
(2) CABG Model
We proposed the CABG model to incentivize improvements in the
coordination and quality of care, as well as episode efficiency, for
beneficiaries treated with CABG irrespective of AMI during the CABG
hospitalization, thereby including beneficiaries undergoing elective
CABG in the CABG model as well as beneficiaries with AMI who have a
CABG during their initial AMI treatment. The CABG model would be
similar to the CJR model in that the anchor hospitalization would be
defined by admission for a surgical procedure, which would be defined
by the MS-DRGs for that procedure alone (80 FR 73280). All CABG
procedures are performed in the inpatient hospital setting. Thus, we
proposed to include beneficiaries admitted and discharged from an
anchor hospitalization paid under CABG MS-DRGs (231-236) under the IPPS
in the CABG model. Based on Medicare claims data for historical CABG
episodes beginning in CYs 2012-2014, the annual number of potentially
eligible beneficiary discharges for the CABG model nationally was
approximately 48,000.\55\
---------------------------------------------------------------------------
\55\ Episodes for CABG beneficiaries initiated by all U.S. IPPS
hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in the proposed rule,
that began in CYs 2012-2014.
---------------------------------------------------------------------------
The proposal for identifying beneficiaries included in the CABG
model was included in proposed Sec. 512.100(c)(2). We sought comment
on our proposal to identify beneficiaries included in the CABG model.
The following is a summary of the comments received and our
responses.
Comment: Similar to the suggestions of commenters recommending that
CMS exclude certain beneficiaries discharged from AMI MS-DRGs or PCI
MS-DRGs with an AMI ICD-10-CM diagnosis code from the AMI model,
several commenters recommended that CMS exclude a variety of
beneficiaries from the CABG model who would otherwise meet the proposed
CABG model criteria for inclusion. Recommendations include excluding
beneficiaries who are in the following clinical scenarios:
Cardiogenic shock or, at a minimum, the subset of
beneficiaries with cardiogenic shock who are transferred from a model
participant or who are transferred to a model participant, as the
impact of the CABG model on transfer decisions could delay access to
life-saving therapies at specialized centers;
Undergoing organ transplantation or VAD implantation
during the CABG episode, as regional pricing could limit access to
life-saving therapies only available at those few centers capable of
caring for advanced heart failure patients and organ transplant
candidates.
Receiving outpatient inotropes for advanced heart failure
during CABG episodes, because these therapies allow beneficiaries to
avoid a surgical bridge to transplant with ventricular assist device
(VAD) implantation but are used in a group of beneficiaries who might
otherwise receive a VAD. The
[[Page 250]]
commenters state that this would be consistent with excluding
beneficiaries who receive VAD during CABG episodes from the CABG model.
Undergoing a second or greater CABG, given the increase in
complexity and comorbidities associated with this population.
Undergoing a salvage CABG due to a failed or aborted PCI,
either during a single admission or a readmission, due to the
clinically frail beneficiaries that result in high-cost episodes.
Response: We appreciate the recommendations of the commenters
regarding the exclusion of certain complex, potentially high-cost
beneficiaries from the CABG model, and note that in some cases
recommendations for exclusion were the same as for the AMI model. We do
not believe it would be appropriate to exclude beneficiaries
experiencing cardiogenic shock, undergoing a second or subsequent CABG,
or undergoing salvage CABG from the CABG model because there are
significant opportunities for improving the quality and efficiency of
care for these beneficiaries during episodes, despite their greater
complexity and medical needs, and we believe it is important to include
these beneficiaries in the test of the CABG model.
While readmission for cardiac transplantation or VAD implantation
would be excluded from CABG episodes based on our proposed CABG model
exclusion list, these beneficiaries would otherwise initiate and remain
in CABG episodes throughout the 90-day post-discharge period both
before and following cardiac transplantation or VAD implantation that
occurs during the 90-day period. Other readmissions and Part B services
furnished to these beneficiaries would be included in the episodes
based on the proposed exclusion list. We believe it is important to
include in the CABG model these beneficiaries with complex care needs
following CABG surgery, including those receiving outpatient inotropes
during CABG episodes, because there are opportunities to improve the
quality and efficiency of their care, despite their experiencing severe
sequelae following CABG. We refer to section III.D.4.b.(2) of this
final rule for further discussion of risk adjustment in the context of
the CABG model's implementation of downside risk and progression to
regional pricing for CABG episodes.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.100(c)(2) to
include the care of beneficiaries in the CABG model who meet the
general beneficiary care inclusion criteria as discussed in section
III.C.4.a.(1) of this final rule and are discharged under a CABG MS-DRG
(231-236) paid under the IPPS, without modification.
(3) SHFFT (Excludes Lower Extremity Joint Replacement) Model
We proposed the SHFFT model to incentivize improvements in the
coordination and quality of care, as well as episode efficiency, for
beneficiaries treated surgically for hip and femur fractures, other
than hip arthroplasty. Together, the CJR and SHFFT models would cover
all surgical treatment options (that is, hip arthroplasty and fixation)
for Medicare beneficiaries with hip fracture.
The SHFFT model would be similar to the CJR model in that the
anchor hospitalization would be defined by admission for a surgical
procedure, which would be defined by the MS-DRGs for that procedure
alone (80 FR 73280). Additionally, most SHFFT procedures are furnished
in the inpatient hospital setting, consisting primarily of hip fixation
procedures, with or without reduction of the fracture, as well as open
and closed surgical approaches. Thus, we proposed to include
beneficiaries admitted and discharged from an anchor hospitalization
paid under SHFFT MS-DRGs (480-482) under the IPPS in the SHFFT model.
Based on Medicare claims data for historical SHFFT episodes beginning
in CYs 2012-2014, the annual number of potentially eligible beneficiary
discharges for the SHFFT model nationally was approximately
109,000.\56\
---------------------------------------------------------------------------
\56\ Episodes for SHFFT beneficiaries initiated by all U.S. IPPS
hospitals not in Maryland and constructed using standardized
Medicare FFS Parts A and B claims, as proposed in the proposed rule,
that began in CYs 2012-2014.
---------------------------------------------------------------------------
The proposal for identifying beneficiaries included in the SHFFT
model was included in proposed Sec. 512.100(c)(3). We sought comment
on our proposal to identify beneficiaries included in the SHFFT model.
The following is a summary of the comments received and our
responses.
Comment: A number of commenters expressed support for the proposal
to define the clinical conditions included in the SHFFT model as
beneficiaries who are admitted and discharged under SHFFT MS-DRGs.
Other commenters recommended that CMS apply additional episode-specific
criteria to exclude beneficiaries from the SHFFT model who would be
discharged from the SHFFT MS-DRGs. Recommendations of beneficiaries
from some commenters to be excluded include:
Beneficiaries with fracture due to falls or trauma in
association with acute myocardial infarction; cardiac arrhythmia;
syncope; cerebrovascular accident; seizure; head injury; or polytrauma
to reduce the large risk of increases in patient transfers from EPM
participants seeking to reduce their financial responsibility for high-
cost beneficiaries;
Beneficiaries with dementia or Alzheimer's disease due to
ethical issues around withholding surgery that could arise in the case
of EPM participants attempting to reduce their financial risk;
Beneficiaries already residing in a SNF at the time of
fracture, who would necessitate an unavoidable SNF stay after discharge
from the anchor hospitalization that would increase the episode cost
attributable to the EPM participant;
Beneficiaries with fractures related to cancer, who would
be expected to be high-cost cases;
Beneficiaries with a history of previous hip fracture;
previous surgery in the region; retained hardware; open fracture;
periprosthetic fractures; and congenital deformities who would be
expected to have atypical and potentially costly hip fracture care
pathways; and
Beneficiaries who smoke or have diabetes, which are risk
factors for fracture nonunion and infection, respectively, because
these behaviorally mediated risk factors for costly care cannot be
managed prior to hip surgery, unless the SHFFT model adjusts prices for
the higher financial risk attributable to these beneficiaries.
Response: We appreciate the recommendations of the commenters to
exclude certain beneficiaries receiving SHFFT from the SHFFT model due
their personal circumstances, other clinical conditions, or
circumstances that led to the hip fracture. We agree with the
commenters that beneficiaries in this group may be more likely to
require complex care during the anchor hospitalization and significant,
intensive health services during the 90 day post-hospital discharge
period, which could result in high-cost SHFFT episodes. However, we do
not believe it would be appropriate to exclude beneficiaries with
complex social or clinical circumstances from the SHFFT model because
there are significant opportunities for improving the quality and
efficiency of care for these beneficiaries during episodes, despite
their greater complexity and medical needs, and we believe it is
important to
[[Page 251]]
include these beneficiaries in the test of the SHFFT model. As
discussed in section III.G.4. of this final rule, we will be monitoring
for issues related to access to care. We expect that all Medicare
beneficiaries with hip fracture are offered clinically appropriate
treatments for their fracture and that all transfers of beneficiaries
with hip fracture to other hospitals are medically necessary and not
determined by the SHFFT model participant's assessment of the
beneficiary's risk of a high-cost SHFFT episode. We also refer to
section III.D.4.b.(2) of this final rule for further discussion of risk
adjustment in the context of the SHFFT model's implementation of
downside risk and progression to regional pricing for SHFFT episodes.
Comment: Some commenters stated that there is a sizeable minority
of beneficiaries with hip fracture who should not and do not get
hospitalized or if hospitalized are not treated with surgery for
fracture so would not be included in the SHFFT or CJR models. These
commenters observed that these beneficiaries were not discussed in the
proposed rule and, therefore, no discussion was included about the
decisions related to the appropriate treatment of hip fracture in the
case of serious disability, frailty, and concurrent illness. The
commenters contended that EPM participants that have historically
served a substantial frail population could be seriously disadvantaged
under the SHFFT model due to the significant care needs for these
beneficiaries following hip fracture surgery and might seek to reduce
their traditional commitment to this population in various ways, which
were contrary to the interests of this highly vulnerable population.
Some commenters further speculated that beneficiaries with hip fracture
could be shifted to no surgery or to joint replacement if SHFFT model
participants seek to reduce high-cost cases that present the most
financial risk under the SHFFT model. The commenters further stated
that the SHFFT model may drive SHFFT model participants to provide more
expensive hip replacement to beneficiaries due to their desire to avoid
SNF admission because of the longer need for protected weight-bearing
post-internal fixation after SHFFT in comparison with total joint
replacement where immediate weight-bearing may be possible.
Response: While we agree with the commenters that surgical fracture
repair may not be appropriate for some beneficiaries with hip fracture,
the proposed SHFFT model was designed to include only those
beneficiaries with surgical fracture repair other than joint
replacement and not those for which surgical fracture repair was not
performed. We believe the decision about fracture treatment should
remain that of the beneficiary in consultation with any caregivers and
his or her treating physicians. We did not propose to define the SHFFT
model by hip fracture alone because we believe the primary
opportunities for care redesign under an EPM that seeks to improve
episode quality and efficiency are in the surgical treatment of hip
fracture, rather than in the primary non-surgical management of hip
fracture for beneficiaries who may or may not be hospitalized.
We do not believe that EPM participants would direct Medicare
beneficiaries to other treatments that would result in their not being
included in the SHFFT model simply on the basis of the beneficiary's
potential for being a high-cost hip fracture surgical episode. We refer
to section III.D.4.b.(2) for discussion of risk adjustment for complex
beneficiaries under the SHFFT model. In addition, we note that
beneficiaries with hip fracture who are treated with joint replacement,
a care pattern that some commenters believe could result from SHFFT
model participants' efforts to avoid of high-cost cases under the SHFFT
model, would be included in the CJR model for most SHFFT model
participants who are also CJR participant hospitals as discussed in
section III.B.3. of this final rule. Thus, it is unlikely that a shift
from a SHFFT procedure to joint replacement would financially benefit
the SHFFT model participant. As discussed in sections III.G.4. through
6. of this final rule, we will be closely monitoring for access to
care, quality of care, and delayed care under the SHFFT model.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.100(c)(3) to
include the care of beneficiaries in the SHFFT model who meet the
general beneficiary care inclusion criteria as discussed in section
III.C.4.a.(1) of this final rule and are discharged under a SHFFT MS-
DRG (480-482) under the IPPS, without modification.
b. Definition of the Related Services Included in EPM Episodes
The general principles for the definition of related services are
the same for the AMI, CABG, and SHFFT models, so we address them in a
single discussion in this section. Like the CJR model, we are
interested in testing inclusive AMI, CABG, and SHFFT episodes to
incentivize comprehensive, coordinated, patient-centered care for the
beneficiary throughout the episode (80 FR 73303). Therefore, we
proposed to exclude Medicare items and services furnished during the
EPM episodes only when unrelated to the EPM episode diagnosis and
procedures based on clinical rationale that would result in standard
exclusions from all of the episodes in a single EPM. Thus, we proposed
to include all items and services paid under Medicare Part A and Part B
unless they fall under an exclusion because they are unrelated to the
EPM episodes.
Also like the CJR model, we proposed that the items and services
ultimately included in the EPM episodes after the exclusions are
applied are called related items and services, and that Medicare
spending for related items and services be included in the historical
data used to set EPM-episode benchmark prices and in the calculation of
actual EPM episode payments that would be compared against the quality-
adjusted target price to assess the performance of EPM participants (80
FR 73303 and 73315). Additionally, we proposed that Medicare spending
for unrelated items and services (excluded from the EPMs' episode
definitions) would not be included in the historical data used to set
EPM-episode benchmark prices or in the calculation of actual EPM
episode payments. We proposed that related items and services for EPM
episodes would include the following items and services paid under
Medicare Part A and Part B, after the EPM-specific exclusions are
applied:
Physicians' services.
Inpatient hospital services.
Inpatient psychiatric facility (IPF) services.
Long-Term Care Hospital (LTCH) services.
Inpatient Rehabilitation Facility (IRF) services.
Skilled Nursing Facility (SNF) services.
Home Health Agency (HHA) services.
Hospital outpatient services.
Independent outpatient therapy services.
Clinical laboratory services.
Durable medical equipment.
Part B drugs.
Hospice.
We note that inpatient hospital services would include services
paid through IPPS operating and capital payments. The AMI, CABG, and
SHFFT episodes also could include certain per-member-per-month model
payments as discussed in section III.D.6.d. of the proposed rule (81 FR
50871 through 50872). These items and services for the
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EPMs are the same items and services included in CJR episodes (80 FR
73303 and 73315).
Similar to the CJR model and for the reasons explained in the CJR
Final Rule, we proposed to exclude drugs that are paid outside of the
MS-DRGs included in the EPM episode definitions, specifically
hemophilia clotting factors, identified by CPT code, diagnosis code,
and revenue center on IPPS claims, from the EPM episodes (80 FR 73303
and 73315). Hemophilia clotting factors, in contrast to other drugs
that are administered during a hospitalization and paid through the MS-
DRG, are paid separately by Medicare in recognition that clotting
factors are costly and essential to appropriate care of certain
beneficiaries. Therefore, we believe there are no EPM episode
efficiencies to be gained in the variable use of these high cost drugs.
We also proposed to exclude IPPS new technology add-on payments for
drugs, technologies, and services from these EPM episodes, excluding
them from both the actual historical episode data used to set EPM-
episode benchmark prices and from actual EPM episode payments that are
reconciled to the quality-adjusted target prices like the CJR model (80
FR 73303-73304 and 73315). This would apply to both the anchor
hospitalization and any related readmissions during the EPM episodes.
New technology add-on payments are made separately and in addition to
the MS-DRG payment under the IPPS for specific new drugs, technologies,
and services that substantially improve the diagnosis or treatment of
Medicare beneficiaries and would be inadequately paid under the MS-DRG
system. We believe it would not be appropriate for the EPM to
potentially diminish beneficiaries' access to new technologies or to
burden hospitals who choose to use these new drugs, technologies, or
services with concern about these payments counting toward EPM
participants' actual EPM episode payment. Additionally, new drugs,
technologies, or services approved for the add-on payments vary
unpredictably over time in their application to specific clinical
conditions.
Finally, we proposed to exclude OPPS transitional pass-through
payments for medical devices as defined in Sec. 419.66 from the EPM
episodes because, through the established OPPS review process, we have
determined that these technologies have a substantial cost but also
lead to substantial clinical improvement for Medicare beneficiaries.
This proposal also is consistent with the CJR model final exclusions
policy (80 FR 73308 and 73315).
We proposed to follow the same general principles in determining
other proposed excluded Part A and Part B services from the EPM
episodes that we use in the CJR model in order to promote coordinated,
high-quality, patient-centered care (80 FR 73304). These include
identifying excluded (unrelated) services rather than included
(related) services based on clinical review. We would operationalize
these principles for the new EPMs, as we do for the CJR model, by
excluding unrelated inpatient hospital admissions during the EPM
episode by identifying MS-DRGs for exclusion on an EPM-specific basis
(80 FR 73304 through 73312 and 73315). We would further exclude
unrelated Part B services during the EPM episode based on the diagnosis
code on the claim by identifying categories of ICD-CM codes for
exclusion (identified by code ranges) on an EPM-specific basis. ICD-9-
CM diagnosis code exclusions would apply to historical episodes used to
construct EPM-episode benchmark prices, while ICD-10-CM diagnosis code
exclusions would apply to EPM episodes during the EPMs' performance
years. We proposed to identify unrelated Part B services and
readmissions based on the BPCI Model 2 Part B exclusion lists that
apply to the anchor MS-DRG that initiates the EPM episode, or to the
price MS-DRG if it is different than the anchor MS-DRG as described
further in section III.D.4.b.(2)(a) of this final rule. This proposal
is consistent with our use of the BPCI Model 2 LEJR ICD-9-CM, ICD-10-
CM, and MS-DRG exclusion lists in the CJR model (80 FR 73304 and
73315).
The BPCI episode-specific exclusion lists were initially developed
more than 3 years ago for the BPCI initiative through a collaborative
effort of CMS staff, including physicians from medical and surgical
specialties, coding experts, claims processing experts, and health
services researchers. The lists have been shared with thousands of
entities and individuals participating in episodes in one or more
phases of the BPCI initiative, and have undergone refinement in
response to stakeholder input about specific diagnoses for exclusion,
resulting in only minimal changes over the last 3 years. Thus, the BPCI
exclusion lists have been vetted broadly in the health care community;
refined based on input from a wide variety of providers, researchers
and other stakeholders; and successfully operationalized in the BPCI
models. We proposed their use in the AMI, CABG, and SHFFT models based
on our confidence related to our several years of experience that these
definitions are reasonable and workable for AMI, CABG, and SHFFT
episodes, for both providers and CMS, and based on our rulemaking for
the CJR model. We note that the BPCI Model 2 exclusion lists for the 48
clinical conditions being tested in the BPCI models include lists that
apply to every MS-DRG that could be an anchor MS-DRG (or price MS-DRG,
if applicable) for the AMI, CABG, and SHFFT episodes.
Similar to the CJR model, we proposed to include in EPM episodes
all Part A services furnished post-hospital discharge during the EPM
episode, as these services are typically intended to be comprehensive
in nature (80 FR 73304 and 73315). We specifically proposed to exclude
unrelated hospital readmissions for MS-DRGs that group to the following
categories of diagnoses: Oncology, trauma medical admissions, surgery
for chronic conditions unrelated to a condition likely to have been
affected by care furnished during the EPM episode, and surgery for
acute conditions unrelated to a condition resulting from or likely to
have been affected by care during the EPM episode. The rationale for
these exclusions is the same as the rationale for their exclusion in
the CJR model (80 FR 73304).
Specifically with respect to Part B services, similar to the CJR
model, we proposed to exclude acute disease diagnoses unrelated to a
condition resulting from or likely to have been affected by care during
the EPM episode, and certain chronic disease diagnoses, as specified by
CMS on a diagnosis-by-diagnosis basis, depending on whether the
condition was likely to have been affected by care during the EPM
episode or whether substantial services were likely to be provided for
the chronic condition during the EPM episode (80 FR 73305 and 73315).
Thus, we would include all Part B services with principal diagnosis
codes on the associated Part B claims that are directly related
(clinically and per coding conventions) to EPM episodes, claims for
diagnoses that are related to the quality and safety of care furnished
during EPM episodes, and claims for services for diagnoses that are
related to preexisting chronic conditions such as diabetes, which may
be affected by care furnished during EPM episodes.
In general, the anchor MS-DRG that initiates the AMI, CABG, or
SHFFT episode would determine the exclusion list that applies to the
EPM episode. For example, AMI episodes may have different exclusion
lists applied based on whether the AMI episode is initiated by
admission to the participant hospital
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that results in discharge from an AMI anchor MS-DRG or a PCI anchor MS-
DRG with AMI ICD-10-CM diagnosis code. If a price MS-DRG applies to the
AMI episode that includes a chained anchor hospitalization as described
in section III.D.4.b.(2)(a) of this final rule, the exclusion list that
applies to the price MS-DRG would apply to the AMI episode. Complete
lists of excluded MS-DRGs for readmissions and excluded ICD-CM codes
for Part B services furnished during EPM episodes after EPM beneficiary
discharge from an anchor or chained anchor hospitalization in the AMI,
CABG, and SHFFT models are posted on the CMS Web site at https://innovation.cms.gov/initiatives/epm.
Like the CJR model policy, we proposed that these exclusion lists
would be updated by sub-regulatory guidance on an annual basis, at a
minimum, to reflect annual changes to ICD-10-CM coding and annual
changes to the MS-DRGs under the IPPS, as well as to address any other
issues that are brought to our attention throughout the course of the
EPMs' performance period (80 FR 73304 through 73305 and 73315). The
standards for this updating process reflect the previously discussed
general principles for determining excluded services. That is, we
proposed to not exclude any items or services that are directly related
to the EPM episode diagnosis or procedure (for example, a subsequent
admission for heart failure or repeat revascularization) or the quality
or safety of care (for example, sternal wound infection following
CABG); or to chronic conditions that may be affected by the EPM
diagnosis or procedure and the post-discharge care (for example,
diabetes). We proposed to exclude items and services for chronic
conditions that are generally not affected by the EPM diagnosis or
procedure and the post-discharge care (for example, prostate removal
for cancer), and for acute clinical conditions not arising from
existing EPM episode-related chronic clinical conditions or
complications from the EPM episode (for example, appendectomy).
Similar to the CJR model, we proposed that the potential revised
exclusions, which could include additions to or deletions from the
exclusion lists, would be posted to the CMS Web site to allow for
public input (80 FR 73305 and 73315). Through the process for public
input on potential revised exclusions and then posting of the final
revised exclusions, we proposed to provide information to the public
about when the revisions would take effect and to which episodes they
would apply.
The proposal for included services for an EPM was included in
proposed Sec. 512.210(a). The proposal for excluded services from the
EPM episode was included in proposed Sec. 512.210(b). The proposal for
updating the lists of excluded services for EPMs was included in
proposed Sec. 512.210(c). We sought comment on our proposals for
included and excluded services for the AMI, CABG, and SHFFT models and
updating the lists of excluded services.
The following is a summary of the comments received and our
responses.
Comment: Most commenters expressed general support for CMS'
proposed episode definition strategy that would include Part A and Part
B items and services and exclude certain unrelated readmissions based
on a list of MS-DRGs, as well as certain unrelated Part B services
based on the principal diagnosis on the claim, consistent with the
episode definition approach for LEJR under the CJR model and the
approach used in the BPCI initiative for several years for BPCI, SHFFT,
AMI, PCI, and CABG episodes. The commenters acknowledged that most
items and services would be included in the episode definition under
the proposal, thus creating broadly defined SHFFT, AMI, and CABG
episodes. In some cases, while commenters agreed with the proposed
general strategy for identifying EPM episode exclusions, they made
specific recommendations for additional exclusions based on a different
exclusions standard, and these commenters are summarized later in this
section, where responses are also provided. In other cases, commenters
who agreed with the strategy for identifying EPM episode exclusions
stated that if CMS finalizes broad EPM episode definitions, risk
adjustment would be necessary in order to ensure fair payment to EPM
participants.
Several commenters recommended CMS to provide greater clarity about
the services included in and excluded from EPM episodes. One commenter
stated that it is hard to differentiate included versus excluded
services, and further added that people are ``irreducible bundles'' and
someone needs to be responsible for all of the issues for people when
they are very sick. The commenter recommended that the longer-term
value of patient-centered medical homes, comprehensive ACOs, and
primary care geriatricians should be considered for beneficiaries
completing EPM episodes and recommended that moving people with complex
illness into such arrangements should be a feature of all CMS
innovations as part of moving fee-for-service payment toward quality
and value. A few commenters recommended that CMS provide a clear
definition and methodology for the term ``related services'' which
would be applied consistently throughout various payment models so
providers could verify how their services would be identified and paid.
Finally, several commenters requested that CMS utilize an inclusions
list rather than an exclusion list to avoid including inappropriate
services by default. One commenter presented analysis that showed AMI
model readmission for seizures and other for organic disturbance and
mental retardation would be included in AMI episodes, and the commenter
believes that neurological and mental health conditions are not related
to cardiac care for AMI.
Response: We appreciate the support of many commenters for our
proposed general approach to identifying excluded items and services
for the EPMs. As we stated in the proposed rule (81 FR 50832), we are
interested in testing inclusive AMI, CABG, and SHFFT episodes to
incentivize comprehensive, coordinated, patient-centered care for the
beneficiary throughout the episode. We agree with the commenter that it
can be hard to distinguish included versus excluded services because
sick people have many complex and interrelated clinical conditions and
corresponding health care needs. The proposed EPM episode definitions
are broad in part for this reason. Additionally, while we also agree
with the commenter that the ongoing and acute health care needs of
medically complex beneficiaries may be addressed through a patient-
centered medical home or ACO, many of these vulnerable beneficiaries
currently are not included in such models or programs. In the case of
other beneficiaries who are included in medical home or ACO models or
programs, they may have specific, new care management needs arising
from an acute cardiac event, CABG, or hip fracture surgery that may be
best managed by the EPM participant that has substantial expertise in
coordinating and managing care throughout AMI, CABG, or SHFFT episodes
because of its participation in the EPM, while the ACO or patient-
centered medical home may have less specific expertise in managing
beneficiaries recovering from major orthopedic or cardiac surgery or an
AMI. We expect that EPM participants, accountable for EPM episode
quality and cost performance
[[Page 254]]
under the EPMs, will work closely with all providers and other
organizations with which a model beneficiary has established
relationships, toward the mutual goal of high quality, well-coordinated
care that maximizes the rate of a beneficiary's return of function and
improvements in health following surgery or AMI. We further expect that
the medical management and care coordination during EPM episodes will
continue to be provided as beneficiaries' transition out of EPM
episodes, potentially into a primary care medical home or other model
or program with accountability for population health, such as an ACO.
Because our proposed inclusive approach to EPM episode definitions
results in many more items and services that are included in EPM
episodes than excluded, we believe it is most efficient to identify
excluded items and services as we proposed. With regard to the
commenters who were concerned that an exclusion list could include
inappropriate services by default, we note that we posted to the CMS
Web site the proposed exclusion lists for the AMI, CABG, and SHFFT
models for comment in association with the proposed rule and are
finalizing the initial exclusion lists through this rulemaking where we
have considered and responded to all the comments we received on our
proposed exclusions. Thus, no items and services would be included in
EPM episodes by default because the exclusion lists have been
established through notice and comment rulemaking. In addition, as
discussed later in this section, we proposed a sub-regulatory process
for updating the exclusion lists to reflect ICD-10-CM coding and annual
changes to the MS-DRGs under the IPPS, as well as to address any other
issues that are brought to our attention throughout the course of the
EPMs' performance periods. The standards for the process reflect the
proposed general principles for excluded services and the process
itself allows opportunity for public input. Thus, we believe that all
items and services included in EPM episodes are intentionally included,
after consideration of public input, rather than included by default.
We note that in the example raised by the commenter of ``default
inclusion,'' we disagree with the commenter that readmissions for
neurological and mental health conditions are unrelated to cardiac care
for AMI. For example, an AHRQ Evidence Report on post-myocardial
infarction found that the evidence is consistent that in patients with
AMI, depression is common at the time of the hospitalization and
persists for at least several months after hospital discharge without
treatment.\57\ Further, the report found that depression is associated
with a significantly increased risk of subsequent death, and of cardiac
readmission and poor quality of life during the first year. Thus, we
would not exclude readmission for treatment of depression from AMI
episodes because we believe that depression would generally be a
chronic condition that was likely to have been affected care during the
AMI model episode. Under our proposal, readmissions for neurological
and mental health conditions would not be excluded from AMI episodes
because they are not MS-DRGs that we proposed to exclude from the AMI
episodes, specifically oncology; trauma medical; chronic disease
surgical unrelated to a condition likely to have been affected by care
during the EPM episode; or acute disease surgical unrelated to a
condition resulting from or likely to have been affected by care during
the AMI episode. Thus, we consider those readmissions related to AMI
episodes as they are medical MS-DRGs for conditions that are likely to
have resulted from or been affected by care during the AMI anchor
hospitalization or during the 90 days post-hospital discharge.
---------------------------------------------------------------------------
\57\ Bush DE, Ziegelstein RC, Patel UV, et al. Post-Myocardial
Infarction Depression. Rockville (MD): Agency for Healthcare
Research and Quality (US); 2005 May. (Evidence Reports/Technology
Assessments, No. 123.) Available from: https://www.ncbi.nlm.nih.gov/books/NBK37817/.
---------------------------------------------------------------------------
By posting to the CMS Web site the lists of excluded services for
the EPMS, we believe we are providing the clarity and detail needed for
any provider to understand whether his or her services furnished to a
beneficiary in an EPM episode are included in the EPM episode
definition because they are related to the episode or excluded from the
EPM episode because they are unrelated. To date, we have applied the
same general approach to identifying exclusions in the BPCI initiative,
the CJR model, and the proposed EPMs, which should facilitate provider
understanding about exclusions under these different episode payment
models. We note, however, that the exclusion list differs based on the
clinical condition that is the focus of the episode so a provider that
is paid under Part B or a hospital would not be able to have a uniform
determination of whether services furnished were included or excluded
from an episode without knowledge of the beneficiary's specific episode
in an episode payment model as well as the clinical condition for which
the provider furnished services. All of the Innovation Center episode
payment models except Model 4 of BPCI use retrospective payment, so all
providers would be paid according to the usual fee-for-service systems
that apply, regardless of whether the items or services furnished by
the provider are included in or excluded from a beneficiary's episode.
Comment: While some commenters expressed full support for CMS'
proposed definition of related services, other commenters recommended
CMS to exclude specific additional groups of services from EPM
episodes. The commenters requested that CMS further exclude:
Readmissions that were already planned for the beneficiary
prior to the anchor hospitalization because their occurrence would be
unrelated to episode care;
Readmissions that were part of the planned post-discharge
care for the beneficiary after the anchor hospitalization, because
these provide no opportunity for efficiency yet could lead to high-cost
episodes:
Medical readmissions for unrelated acute and chronic
conditions;
Part B services that are not directly related to the
episode;
Cardiac rehabilitation, intensive cardiac rehabilitation,
and chronic care management services where appropriate utilization
under the EPMs in the context of historical low utilization would lead
to increased episode costs during the EPM performance period;
Behavioral and substance abuse services because these are
not always integral or of strong relevance to the clinical definitions
of the EPMs, and CMS does not provide claims data to model participants
for these services so no participants can predict, model, or calculate
episode spending; and
Outpatient chemotherapy, psychiatric readmissions, and
high cost intravenous therapy administered through DME that are
unrelated to the episode and could lead to increased episode costs.
Response: We believe that it is not necessary to exclude from EPM
episodes planned readmissions and outpatient services, regardless of
whether those plans were made prior to the anchor hospitalization or
during the anchor hospitalization but prior to discharge, solely
because the readmissions or outpatient services are planned in advance.
While we understand that certain other CMS programs account differently
for planned readmissions by excluding them from readmission
calculations, such as the HRRP which reduces payments to hospitals with
excess readmissions, we do not believe that planned readmissions should
be
[[Page 255]]
excluded from EPM episodes, where the goals of the EPMs are to improve
the quality and efficiency of episode care and where we do not make a
specific assessment about excess readmissions. Just like unplanned
readmissions, we believe that planned readmissions should be excluded
from EPM episodes only if they are unrelated to the EPM episodes based
on the proposed standards for exclusion of inpatient readmissions that
group to the following categories of diagnoses: Oncology; trauma
medical; chronic disease surgical unrelated to a condition likely to
have been affected by care during the EPM episode; and acute disease
surgical unrelated to a condition resulting from or likely to have been
affected by care during the EPM episode. We continue to believe these
standards are appropriate to identify excluded readmissions from EPM
episodes given our design of the EPMs to test comprehensive,
coordinated patient-centered care for the beneficiary throughout
broadly defined EPM episodes. Unless a readmission is excluded from the
EPM episode based on these standards, any readmission, whether planned
or unplanned, would be related to the EPM episode and be affected by
the clinical condition that is the basis for that episode. We
appreciate the concerns of the commenters about ensuring appropriate
EPM episode prices in the case of planned readmissions. While we are
not adopting any specific methodologies for identifying and making
episode payment adjustments for such planned, related readmissions now
except in the case of a CABG readmission during an AMI episode as
discussed in section III.D.4.b.(2)(c), we will study this issue in more
detail especially as it relates to the cardiac models. Should we
determine a change to our policies regarding planned, related
readmission could be appropriate, we will make proposals through future
rulemaking.
To the extent that planned readmissions reflect certain clinically
appropriate care patterns for beneficiaries in EPM episodes based on
plans made during the anchor hospitalization, we expect that such
readmissions would be included in the historical EPM episodes used to
establish EPM-episode payments and thus hospitals would be
appropriately paid, on average, for EPM episode care. To the extent
that efficiencies in EPM episode care are possible and medically
appropriate, reducing planned readmissions may provide an opportunity
for increased EPM episode efficiencies. However, we would not expect
EPM participants to reduce EPM-episode spending by shifting the
utilization of medically necessary services, such as planned
readmissions, until after the EPM episode ends. We refer to section
III.D.4.b.(2)(c) of this final rule for discussion of the pricing
adjustment for CABG readmissions during AMI episodes due to this
costly, clinically-appropriate care pattern of delayed CABG for some
beneficiaries with AMI.
Furthermore, while we expect that certain elective admissions
considered related under the EPMs may be planned prior to the anchor
hospitalization for the EPM episode and could, therefore, occur during
the 90-day post-discharge period, we believe that such actual
readmissions after CABG, SHFFT or AMI treatment are uncommon during the
post-surgical recovery or post-AMI recovery period for EPM
beneficiaries that extends 90 days following discharge from the anchor
hospitalization. If such readmissions were planned, they would often be
canceled due to the intervening surgery or AMI until the beneficiary
has fully recovered. We will not exclude them all as unrelated because
any readmission not on the EPM exclusion list may be related care
furnished during the post-surgical or post-AMI recovery period. Our
exclusion methodology does not allow us to identify those readmissions
that are truly elective; that is, the condition was present and the
readmission was planned prior to the hospitalization that anchored the
EPM episode and scheduled during the 90-day post-hospital discharge
period.
For readmissions to medical MS-DRGs, the selection of the principal
diagnosis code is not clear-cut so we believe they should all be
included in the EPM episode definition so providers focus on
comprehensive care to beneficiaries in episodes. We believe that
readmissions to medical MS-DRGs are generally linked to the
hospitalization or event as a complication of the illness that led to
the procedure or event, a complication of treatment or interactions
with the health care system, or a chronic illness that may have been
affected by the course of care. Therefore, we believe it is infeasible
under the EPMs to identify medical readmissions for unrelated acute and
chronic medical conditions, other than our proposal to exclude
readmissions for oncology and trauma medical diagnoses.
Similarly, our proposal identified those Part B services unrelated
to the episode as acute disease diagnoses unrelated to a condition
resulting from or likely to have been affected by care during the EPM
episode and certain chronic disease diagnoses depending on whether the
condition was likely to have been affected by care during the EPM
episode or whether substantial services were likely to be provided for
the chronic condition during the EPM episode. We do not believe that
requiring a direct relationship between the diagnosis for the Part B
services and the clinical condition that is the basis for the EPM
episode is appropriate under the broadly defined episodes of the EPMs.
Most medical conditions are likely to be affected by care during the
EPM episode, yet they may not have a direct relationship to the
clinical condition that is the reason for the anchor hospitalization.
We also do not believe that it would be appropriate to exclude
other specific Part B services that are related to the clinical
conditions that are the basis for EPM episodes, such as cardiac
rehabilitation, intensive cardiac rehabilitation, and chronic care
management services, just because they are underrepresented in the
baseline period upon which benchmark episode prices are set. As
discussed in section III.D.4.b.(3) of this final rule, to the extent
that care redesign under the EPMs increases utilization of these
services to improve episode quality and efficiency, periodic updates to
the 3 years of historical data used to establish EPM-episode benchmark
prices would result in greater representation of these services that
reflect more recent care patterns.
Additionally, we do not believe that it would be appropriate to
exclude behavioral health and substance abuse services, including
psychiatric readmissions, from EPM episodes because these services are
for conditions that are likely to affect EPM episode care. We note that
these services are not common in episodes and, while we acknowledge
that the episode claims data provided to EPM participants will not
include these data, our proposal to exclude this information but
include the costs of the services in EPM episodes is consistent with
our usual treatment of these services in other similar CMS programs and
models where providers must take on risk in managing the care of their
beneficiaries, such as the Shared Savings Program and BPCI initiative.
Based on our experience to date with bundled payment models and the
Shared Savings Program, this policy has not been a significant
impediment to the operations of these efforts. For example, in the most
recent episodes in BPCI Models 2 and 3, the claims for behavioral
health and substance abuse services included in episodes that we
[[Page 256]]
did not share with BPCI participants accounted for less than 0.1
percent of total episode spending. We refer to section III.K. of this
final rule for further discussion of issues related to sharing
beneficiary-identifiable data for behavioral health and substance abuse
services with EPM participants.
With regard to the commenters requesting that we exclude outpatient
chemotherapy services from the EPM episode definitions, we agree that
these should be excluded from EPM episodes in accordance with our
proposal that excludes services based on ICD-9-CM and ICD-10-CM cancer
diagnosis codes on the proposed EPM exclusion lists from historical and
actual EPM episodes. In the case of high-cost intravenous therapy
administered through DME, we would only exclude such treatments if the
claims reported ICD-10-CM diagnosis codes that would identify these
services as unrelated to the EPM episodes. Otherwise, despite the cost
of this therapy, these services would be included in EPM episodes
because they are related.
Comment: Several commenters recommended CMS to exclude readmissions
for PCI from AMI episodes, stating that current STEMI clinical
guidelines for the culprit artery lesion in addition to other multi-
vessel stenosis states, ``Approximately 50% of patients with STEMI have
multivessel disease. PCI options for patients with STEMI and
multivessel disease include: (1) Culprit artery-only primary PCI, with
PCI of non-culprit arteries only for spontaneous ischemia or
intermediate or high-risk findings on pre-discharge noninvasive
testing; (2) multi-vessel PCI at the time of primary PCI; or (3)
culprit artery-only primary PCI followed by staged PCI of non-culprit
arteries.'' \58\ Another commenter quoted on the topic from the most
recent update to the guidelines published in 2016, ``Although several
observational studies and a network meta-analysis have suggested that
multivessel staged PCI may be associated with better outcome than
multivessel primary PCI, there are insufficient observational data and
no randomized data at this time to inform a recommendation with regard
to the optimal timing of nonculprit vessel PCI.''
---------------------------------------------------------------------------
\58\ Levine GN, Bates ER, Blankenship JC, et al. 2015 ACC/AHA/
SCAI Focused Update on Primary Percutaneous Coronary Intervention
for Patients With ST-Elevation Myocardial Infarction: An Update of
the 2011 ACCF/AHA/SCAI Guideline for Percutaneous Coronary
Intervention and the 2013 ACCF/AHA Guideline for the Management of
ST-Elevation Myocardial Infarction. J Am Coll Cardiol.
2016;67(10):1235-1250. doi:10.1016/j.jacc.2015.10.005.
---------------------------------------------------------------------------
The commenters recommended CMS to exclude planned readmissions for
PCI from the AMI episode definition because the AMI model as proposed
would discourage the recommended course of care of a secondary PCI
procedure for AMI patients with multivessel disease. The commenters
believe that the AMI episode definition could encourage the treatment
of secondary lesions during the initial angioplasty and in other cases
could provide an incentive to delay treatment of the secondary lesions
until after the 90-day post-hospital discharge duration of the AMI
episode has concluded. The commenters added that another strategy of
EPM participants to deal with limited AMI episode payments might be to
inappropriately refer multivessel disease patients into the separate
CABG model.
Alternatively if CMS does not excluded planned PCI readmissions,
the commenters recommended CMS to exclude STEMI beneficiaries with
multivessel disease from the AMI model and/or make accommodations in
the pricing methodology for the extra cost of treating such
beneficiaries appropriately. As another alternative, the commenters
requested that CMS shorten the AMI episode duration to 30 days post-
discharge so that secondary PCI could be performed for multivessel
disease without the financial constraints of an ongoing AMI episode.
Finally, the commenters recommended that if the AMI episodes cannot be
revised to avoid these potentially harmful incentives, CMS should
monitor and evaluate whether these shifts in pattern of care are
occurring and whether they have affected patient outcomes.
Response: While we appreciate the concerns of the commenters, as we
stated in the proposed rule (81 FR 50852), fewer than 3 percent of
those AMI model beneficiaries who receive inpatient or outpatient PCIs
during AMI episodes receive the PCIs between 2 and 90 days post-
discharge from an anchor or chained anchor hospitalization. Since a PCI
for an AMI typically is provided during the anchor hospitalization and
most PCIs later in an episode occur in the context of a beneficiary
presenting through the emergency department, we believe that in most
cases of PCI following discharge from the anchor hospitalization, the
beneficiary likely has experienced a complication of care resulting in
a PCI that may potentially be avoided through care management during
the AMI episode. This PCI would clearly be related to the AMI episode
and should not be excluded from the AMI episode.
It would also be inappropriate to exclude beneficiaries with STEMI
and multivessel disease from the AMI model simply because their plan of
care could include a secondary PCI procedure as these beneficiaries
would represent nearly 50 percent of STEMI patients, who themselves
make up a significant percent of beneficiaries in the AMI model. While
we expect that few beneficiaries would follow this care pattern based
on our analysis of historical AMI episodes, in this scenario the PCI
would clearly be related to the AMI and, therefore, be appropriately
included in the AMI episode definition. Given that our intention is to
offer appropriate incentives for care quality and efficiency by holding
AMI model participants accountable for readmissions that could be
related to the quality of care provided prior to the readmission, we
believe that a pricing adjustment for a PCI readmission or outpatient
PCI would not be appropriate.
We note that the recently updated treatment guidelines cited by the
commenters state there is insufficient observation data and no
randomized data to inform a recommendation regarding the optimal timing
of non-culprit vessel PCI. The guidelines contain no specific
recommendation for the timing of delayed treatment of secondary
lesions, while specifically stating that the ``recommendation with
regard to multivessel primary PCI in hemodynamically stable patients
with STEMI has been upgraded and modified . . . to include
consideration of multivessel PCI, either at the time of primary PCI or
as a planned, staged procedure.'' Given that there is no specific
recommendation regarding the routine performance of multivessel PCI for
patients with STEMI and multivessel disease, nor a recommendation on
the timing for multivessel PCI if it is performed, we do not believe
the AMI model definition discourages patterns of care that are
recommended for AMI patients with multivessel disease. We also do not
see any reason why the care patterns related to performing PCI for
multivessel disease following STEMI should lead us to shorten the AMI
episode duration from 90 days post-discharge to 30 days or to make a
pricing adjustment for AMI episodes that include this pattern of care.
We refer to section III.C.4.c.(2) of this final rule for further
discussion of the AMI episode duration.
As recommended by the commenters, we will evaluate care patterns
under the AMI model for secondary PCI following an initial PCI for
treatment of AMI to determine whether shifts in care are
[[Page 257]]
occurring and whether changes in beneficiary outcomes are observed. We
refer to section IV. of this final rule for further discussion of our
plans for evaluation of the AMI model.
Comment: One commenter requested confirmation of their
understanding of CMS' proposal to exclude MS-DRGs for inpatient
hospital readmissions that group to the ``Trauma medical'' category of
diagnoses. The commenter interpreted this provision as trauma diagnoses
unrelated to the initial MS-DRG triggering an episode.
Response: By trauma medical diagnoses, we mean that those MS-DRGs
that represent a readmission for medical treatment of trauma during an
EPM episode are excluded. For example, we would exclude MS-DRGs 082-087
in the Traumatic Stupor & Coma series and MS-DRGs 088-090 in the
Concussion series.
Comment: Several commenters recommended CMS to exclude hospice
services from the EPM episode definition as they generally would be
unrelated to the EPM episodes. The commenters stated that including
hospice services in EPM episodes could result in incentives for
underutilization of the hospice benefit. They encouraged CMS to exclude
all hospice services in order to ensure timely access to hospice for
EPM beneficiaries. One commenter pointed out that exclusion of hospice
services from the EPM episode definitions would be consistent with
their exclusion from BPCI episodes.
Response: We appreciate the interest of the commenters in ensuring
continued beneficiary access to hospice services under the EPMs. We
note that although we exclude hospice services from BPCI episodes, we
include them in LEJR episodes in the CJR model (80 FR 73307). We
understand that EPM beneficiaries could receive hospice services during
an episode under several different types of clinical circumstances. For
example, the beneficiary could be enrolled in hospice prior to a SHFFT
episode, experience a pathologic hip fracture, and require a SHFFT
procedure to stabilize his or her hip. Alternatively, the beneficiary
could have a CABG and enter into hospice at some point during the
episode in the 90 days following discharge from the anchor
hospitalization, either after experiencing a surgical complication
leading to a terminal prognosis, progressive severe heart failure
despite the CABG, or based on a new diagnosis of a terminal stage of an
illness.
As we explained in the CJR Final Rule (80 FR 73307), Medicare
hospice care is palliative care for individuals with a prognosis of
living 6 months or less if the terminal illness runs its normal course.
As referenced in Sec. 418.22(b)(1), to be eligible for Medicare
hospice services, the patient's attending physician (if any) and the
hospice medical director must certify that the individual is
``terminally ill,'' as defined in section 1861(dd)(3)(A) of the Act and
our regulations at Sec. 418.3; that is, the individual's prognosis is
for a life expectancy of 6 months or less if the terminal illness runs
its normal course. When an individual is terminally ill, many health
problems are brought on by underlying condition(s), as bodily systems
are interdependent. Section 1861(dd)(1) of the Act establishes the
services that are to be rendered by a Medicare certified hospice
program and those services include: Nursing care; physical therapy;
occupational therapy; speech-language pathology therapy; medical social
services; home health aide services (now called hospice aide services);
physician services; homemaker services; medical supplies (including
drugs and biologics); medical appliances; counseling services
(including dietary counseling); short-term inpatient care (including
both respite care and care necessary for pain control and acute or
chronic symptom management) in a hospital, nursing facility, or hospice
inpatient facility; continuous home care during periods of crisis and
only as necessary to maintain the terminally ill individual at home;
and any other item or service which is specified in the plan of care
and for which payment may otherwise be made under Medicare, in
accordance with Title XVIII of the Act. The services offered under the
Medicare hospice benefit must be available, as needed, to beneficiaries
24 hours a day, 7 days a week (section 1861(dd)(2)(A)(i)of the Act).
The regulations at Sec. 418.54(c) stipulate that the comprehensive
hospice assessment must identify the patient's physical, psychosocial,
emotional, and spiritual needs related to the terminal illness and
related conditions, and address those needs in order to promote the
hospice patient's well-being, comfort, and dignity. The comprehensive
assessment must take into consideration the following factors: The
nature and condition causing admission (including the presence or lack
of objective data and subjective complaints); complications and risk
factors that affect care planning; functional status; imminence of
death; and severity of symptoms (Sec. 418.54(c)). Additionally, the
hospice Conditions of Participation (CoPs) at Sec. 418.56(c) require
that the hospice must provide all reasonable and necessary services for
the palliation and management of the terminal illness, related
conditions and interventions to manage pain and symptoms. Therapy and
interventions must be assessed and managed in terms of providing
palliation and comfort without undue symptom burden for the hospice
patient or family. In the December 16, 1983, Hospice final rule (48 FR
56010 through 56011), regarding what is related versus unrelated to the
terminal illness, we stated: ``We believe that the unique physical
condition of each terminally ill individual makes it necessary for
these decisions to be made on a case-by-case basis. It is our general
view that hospices are required to provide virtually all the care that
is needed by terminally ill patients.''
Thus, we believe that hospice services furnished to EPM
beneficiaries should be included in the episode definition for the
EPMs, regardless of the specific diagnosis of the beneficiary, because
hospices are to provide virtually all care that is needed by terminally
ill patients. This is consistent with our conclusion when we considered
hospice services in the LEJR episode definition under the CJR model (80
FR 73307). If an EPM beneficiary was receiving hospice services during
an episode, either because the beneficiary was enrolled in hospice
prior to surgery or a cardiac event and continued in hospice following
surgery or the cardiac event or the beneficiary enrolled in hospice
following the surgery or cardiac event that initiated the EPM episode,
we believe that hospice services would encompass care related to the
EPM episode and should, therefore, be included in the episode
definition. As previously noted, given the comprehensive nature of the
hospice benefit and the fact that body systems are interdependent at
end of life, virtually all care needed by the terminally-ill individual
would be related to the terminal prognosis and thus the responsibility
of the hospice.
As previously noted, hospices are required, per the Hospice CoPs at
Sec. 418.56(c), to provide all reasonable and necessary services for
the palliation and management of the terminal illness, related
conditions, and interventions to manage pain and symptoms. For patients
that underwent surgery or cardiac care under the EPMs that have also
elected the Medicare hospice benefit, hospice services would need to
respond to the care needs of the EPM beneficiary following surgery or
hospitalization for cardiac care. As in the case of other medically
necessary services that would improve a beneficiary's quality of care
and quality
[[Page 258]]
of life, we expect that EPM beneficiaries will receive clinically
appropriate referrals to hospice in a timely manner. Furthermore, we
also believe hospice services could contribute to episode efficiency
through improved comprehensive care coordination and management for EPM
beneficiaries that have a terminal prognosis. As previously stated,
hospices are required to provide comprehensive care coordination and
management per the hospice CoPs at 418.56. As discussed in sections
III.G.4. through 6. of this final rule, we will be monitoring for
access to care, quality of care, and delayed care and will take actions
as described if problems are found.
Comment: One commenter recommended that CMS exclude Inpatient
Psychiatric Facility (IPF) services from the EPM episode definition as
not being related to or resulting from the EPM clinical condition,
consistent with their treatment in BPCI episodes.
Response: We are clarifying that under the BPCI models, IPF
services furnished following discharge from the episode anchor
hospitalizations but during the episode are included in the episode
definition, unless they fall into one of the excluded MS-DRGs for the
episode. Thus, we include inpatient psychiatric services whether paid
under the IPPS or the IPF PPS in all episodes under the BPCI initiative
according to the same policy that would exclude readmissions paid under
either payment system based on the same exclusion list. As we concluded
for the CJR model (80 FR 73306), we see no reason for the EPMs not to
apply the standards we proposed to define related and unrelated Part A
and Part B services with respect to IPF services furnished during EPM
episodes. Therefore, we believe the list of excluded MS-DRGs applicable
to the EPM episode identifies those IPF admissions during the episode
that would be clinically unrelated to the episode so we exclude them
from the EPM episode definition, whereas IPF services any time during
an EPM episode that result in discharge from an MS-DRG that is not
excluded would be related and included in the EPM episode definition.
We disagree with the commenter that all IPF services furnished
following discharge from the anchor hospitalization that initiates the
EPM episode after surgery are unlikely to be related to or resulting
from the EPM clinical condition or its treatment. Thus, we believe the
MS-DRG exclusions for the EPM episodes identify those circumstances
when IPF services are unrelated to the episode.
Comment: Several commenters recommended that CMS exclude post-acute
care services from EPM episodes if the beneficiary chooses a facility
not recommended by the EPM participant or treating physician. Other
commenters recommended that CMS exclude post-acute care services
following excluded readmissions due to how little is known about the
causal relationship between an unrelated hospital readmission and
subsequent post-acute care services.
Response: As discussed in section III.G.2. of this final rule, the
proposed EPMs would not limit an EPM beneficiary's ability to choose
among Medicare providers or the range of services that would be
available to them. Beneficiaries would continue to choose any Medicare
participating provider, or any provider that has opted out of Medicare,
with the same costs, copayments, and responsibilities as they have with
other Medicare services. Therefore, it would not be appropriate to
exclude post-acute care services from the EPM episode definition if the
beneficiary chooses a post-acute care facility that is not recommended
by the EPM participant or the beneficiary's treating physician.
With regard to requests that we exclude post-acute services from
EPM episodes following excluded readmissions, as Part A services are
generally intended to be comprehensive in nature and because the
beneficiary in an EPM episode would still be in the recovery period for
the 90 days following surgery or an AMI, we believe any post-acute care
services provided during the EPM episode would be related to the SHFFT,
CABG, or AMI. Regardless of the reason for the hospitalization
immediately preceding the initiation of post-acute care services during
an EPM episode, the post-acute care provider would need to address the
beneficiary's post-surgical or post-AMI recovery, even if the post-
acute care services followed an unrelated admission to the hospital.
Comment: Several commenters identified additional MS-DRGs or
conditions resulting in hospitalization that they recommended be
excluded from the cardiac episodes. The commenters requested that
clinical conditions that group to the following MS-DRGs be excluded
from the AMI and CABG model episode definitions, generally on the basis
that these readmissions are not integral to the management of
beneficiaries in the 90 days following discharge from the AMI or CABG
anchor hospitalization:
222 (Cardiac Defibrillator Implant with Cardiac
Catheterization with AMI/HF/Shock with MCC).
223 (Cardiac Defibrillator Implant with Cardiac
Catheterization with AMI/HF/Shock without MCC).
224 (Cardiac Defibrillator Implant with Cardiac
Catheterization without AMI/HF/Shock with MCC).
225 (Cardiac Defibrillator Implant with Cardiac
Catheterization without AMI/HF/Shock without MCC).
226 (Cardiac Defibrillator Implant without Cardiac
Catheterization with MCC).
227 (Cardiac Defibrillator Implant without Cardiac
Catheterization without MCC).
266 (Endovascular Cardiac Replacement with MCC).
267 (Endovascular Cardiac Replacement without MCC).
273 (Percutaneous Intracardiac Procedures with MCC).
274 (Percutaneous Intracardiac Procedures without MCC).
Another commenter claimed that CMS' proposal to include nearly all
surgical MS-DRGs within Major Diagnostic Category (MDC) 5 (Diseases and
Disorders of the Circulatory System) in the AMI and CABG episode
definition, rather than also requiring an acute care ICD-CM diagnosis
code on the claim for the MS-DRG in MDC 5 to be included in the
episode, especially within the 31 to 90 days following discharge from
the anchor hospitalization, could penalize hospitals for providing
necessary care within the timeframe for AMI and CABG episodes. Examples
provided by the commenter included abdominal aortic aneurysm;
peripheral bypass surgical and endovascular procedures; surgical valve
repair or replacement; planned inpatient or outpatient
electrophysiology admissions to replace cardiac defibrillators or
pacemakers; and staged outpatient revascularization procedures several
months after an initial intervention for AMI.
One commenter recommended that readmissions for extracorporeal
membrane circulation (ECMO) that would group to MS-DRG 003 (ECMO or
Tracheostomy with MV > 96 hours or PDX Except Face, Mouth and Neck with
Major O.R. Procedure) be excluded from the CABG episode definition.
Another commenter recommended the addition of 241 MS-DRGs to CMS' the
readmissions exclusion list for CABG episodes, in addition to the 370
MS-DRGs proposed by CMS on the list, on the basis that these MS-DRGs
did not have any clinical relevance to CABG. These additional MS-DRGs
would result in the exclusion of 611 MS-DRGs out of a total of
approximately 760 MS-DRGs from CABG episodes.
[[Page 259]]
Finally, the commenter who favored CMS' adopting a more robust
methodology for differentiating planned from unplanned use of inpatient
and outpatient services within the 90-day post-discharge period,
similar to the methodology used in the HRRP for AMI and CABG, requested
that should CMS continue with the MS-DRG exclusion list that CMS
revisit the proposed exclusion lists for AMI and CABG episodes. The
commenter claimed there were some inconsistencies in the treatment of
AMI MS-DRG-anchored AMI episodes and CABG episodes compared with PCI
MS-DRG-anchored AMI episodes. The commenter identified MS-DRGs 326
(Stomach, Esophageal, and Duodenal Procedures with MCC); 327 (Stomach,
Esophageal, and Duodenal Procedures with CC); 328 (Stomach, Esophageal,
and Duodenal Procedures without CC/MCC); 266 (Endovascular Cardiac
Valve Replacement with MCC); and 267 (Endovascular Cardiac Valve
Replacement without MCC) as on the PCI MS-DRG-anchored AMI exclusion
list but not on the AMI MS-DRG-anchored AMI and CABG MS-DRG exclusion
list, and was unclear about the rationale for these differences.
Response: We appreciate the requests by the commenters to add
certain MS-DRGs to the exclusion list for one or both of the cardiac
care models. CMS clinicians and coding staff reviewed the three
different proposed exclusion lists for AMI MS-DRG-anchored AMI
episodes, PCI MS-DRG-anchored AMI episodes, and CABG episodes for the
inconsistencies identified by one of the commenters against the
proposed standards for excluding readmissions during EPM episodes. We
proposed to exclude MS-DRGs 326-328 from PCI-anchored AMI episodes and
CABG episodes but not from AMI MS-DRG-anchored episodes. Based on
clinical review, we determined that admissions to these MS-DRGs would
be for acute disease surgical diagnoses unrelated to a condition
resulting from or likely to have been affected by care during the AMI
or CABG episode so these MS-DRGs meet the proposed standards for
exclusion from AMI MS-DRG-anchored AMI episodes. Therefore, we are
adding MS-DRGs 326-328 to the AMI MS-DRG-anchored AMI exclusion list.
MS-DRGs 266-267 are on the exclusion list for PCI MS-DRG-anchored AMI
episodes, but not on the exclusion list for AMI MS-DRG-anchored AMI
episodes or CABG episodes. Based on clinical review, we determined that
admissions to these MS-DRGs would be for chronic disease surgical
diagnoses unrelated to a condition likely to have been affected by care
during the AMI or CABG episode so these MS-DRGs meet the proposed
standards for exclusion from both AMI MS-DRG-anchored AMI episodes and
CABG episodes. Therefore, we are adding MS-DRGs 266-267 to the AMI MS-
DRG-anchored AMI exclusion list and the CABG exclusion list.
We note that MS-DRGs 222-227 and 273-274 requested for exclusion
from AMI and CABG episodes by several commenters are surgical MS-DRGs
in MDC 5. As another commenter pointed out, some of these may represent
planned readmissions following discharge from the anchor
hospitalization during the 90-day post-discharge period. However, based
on our proposed readmission exclusion methodology that identifies
excluded MS-DRGs without examining the diagnosis coding on hospital
claims to determine the reason for the readmission, as discussed in our
response to comments earlier in this section, we will not exclude
planned readmissions from the AMI and CABG episode definitions. Thus,
we proposed that MS-DRGs 222 through 227 and 273 through 274 not be
excluded from AMI (regardless of PCI or AMI MS-DRG-anchor) and CABG
episodes, and we are continuing to include these MS-DRGs in those
episodes, as well as the other surgical MS-DRGs in MDC 5 that we did
not propose to exclude from all AMI and CABG episodes. Based on
clinical review, we determined that these readmissions for circulatory
system procedures are related services in AMI and CABG episodes, based
on our proposed standards for excluding surgical MS-DRGs from the EPMs:
Chronic disease surgical diagnoses unrelated to a condition likely to
have been affected by care during the EPM episode; and acute disease
surgical diagnoses unrelated to a condition resulting from or likely to
have been affected by care during the EPM episode. While some
commenters stated that these readmissions were not integral to AMI and
CABG episodes, that is not the standard we used for determining related
readmissions because we are adopting broad episode definitions for the
EPMs. While we are not adopting any specific methodologies for
identifying and making episode payment adjustments for such planned,
related readmissions now except in the case of a CABG readmission
during an AMI episode as discussed in section III.D.4.b.(2).(c). of
this final rule, we will study this issue in more detail especially as
it relates to the cardiac models. Should we determine a change to our
policies regarding planned, related readmission could be appropriate,
we will make proposals through future rulemaking.
Finally, we carried out a clinical review of the 241 MS-DRGs
recommended by a commenter for addition to the CABG exclusion list, as
well as MS-DRG 003 that was recommended for exclusion by another
commenter. About three-quarters of the MS-DRGs recommended for
exclusion were medical MS-DRGs that did not meet our proposed standards
for excluding readmissions based on medical diagnoses, specifically
oncology or trauma medical diagnoses. As we first discussed in the CJR
Final Rule (80 FR 73304) and in the EPM proposed rule (81 FR 50833), we
believe all other readmissions for medical MS-DRGs should be included
in EPM episodes because these are generally linked to the condition
that was the focus of the anchor hospitalization as a complication of
that illness, a complication of treatment or interactions with the
health care system, or a chronic illness that may have been affected by
the course of episode care. The inclusion of most MS-DRGs in EPM
episodes should encourage providers to focus on comprehensive care for
beneficiaries during episodes. More than half of the surgical MS-DRGs
recommended for CABG episode exclusion were in MDC 5 and, with the
exception of MS-DRGs 266-267 discussed previously, we will not exclude
them from CABG episodes based on the reasons discussed earlier in this
response. Of the remaining surgical MS-DRGs spread across 7 MDCs
representing different body systems, we will also not exclude any of
these MS-DRGs because they do not meet our standards for excluding MS-
DRGs from CABG episodes, namely that the readmissions are for chronic
disease surgical diagnoses unrelated to a condition likely to have been
affected by care during the CABG episode or acute disease surgical
diagnoses unrelated to a condition resulting from or likely to have
been affected by care during the CABG episode. We believe that our
determinations may be different than the commenters' recommendations
because our standard for exclusion in broadly defined CABG episodes is
much more stringent than the commenters' review of MS-DRGs based on
their clinical relevance to CABG.
Comment: Several commenters requested that CMS add MS-DRGs 469 and
470 for major joint replacement of the lower extremity to the exclusion
list for SHFFT episodes, unless the joint replacement was for the joint
that
[[Page 260]]
underwent a SHFFT procedure that initiated the SHFFT episode. The
application of the exclusion in this way would exclude elective LEJR
readmissions from SHFFT episodes. The commenters claimed this approach
would avoid outliers and penalizing the orthopedic surgeon for
identification and treatment of unmet medical needs while treating a
beneficiary following a hip fracture. One commenter stated that these
circumstances would be highly variable, particularly in hospitals with
small patient volume. They recommended excluding MS-DRGs 469 and 470
from SHFFT episodes so as not to penalize low-volume hospitals who
performed costly elective LEJR during SHFFT episodes on an occasional
basis.
Response: Based on our proposed methodology to identify excluded
readmissions by a list of MS-DRGs, we would have to substantially
increase the complexity of our exclusions methodology to identify only
a subset of MS-DRG 469 and 470 readmissions for exclusion because they
were not related to the joint surgery that initiated the SHFFT episode.
We do not believe this additional complexity is necessary because we
expect that LEJR replacement of another joint, whether elective or for
fracture, would be rare during SHFFT episodes. Most LEJR is elective,
rather than for fracture, and given the prolonged partial weight-
bearing commonly required for recovery from SHFFT procedures and the
general complexity and frailty of many beneficiaries who would be
included in SHFFT episodes, we believe that elective LEJR of a joint
other than that involved in the initial SHFFT surgery during the 90
days post-discharge from the SHFFT model anchor hospitalization would
be exceedingly rare. We would expect that most LEJR procedures during
SHFFT episodes would be related because they would involve the joint
that had an initial SHFFT procedure.
Comment: One commenter recommended that CMS exclude Part B services
from CABG episodes based on individual ICD-9-CM and ICD-10-CM diagnosis
codes, rather than categories as CMS proposed. The commenter claimed
that CMS' proposed process would result in over 22,000 ICD-10-CM
diagnosis codes that would be classified as included in the CABG
episode, thereby resulting in those services being considered as
related items and services. The commenter believes that this
methodology would result in many of the included services having no
clinical relevance to a CABG. The commenter recommended CMS to specify
Part B episode exclusions at the ICD-CM code level to ensure that only
services that are clinically related to a CABG are included in the
episode. The commenter recommended 4,960 specific ICD-9-CM and 18,859
specific ICD-10-CM diagnosis codes be added to the CABG exclusion list.
Another commenter recommended that CMS exclude the following ICD-
10-CM diagnosis code categories from AMI episodes as they are not
integral to AMI treatment: I47 (Paroxysmal tachycardia); I48 (Atrial
fibrillation and flutter); and I49 (Other cardiac arrhythmias). The
same commenter recommended that CMS exclude ICD-9-CM diagnosis code
category 427 (Cardiac dysrhythmias) from AMI episodes.
Response: We appreciate the recommendations from the commenter
about additional ICD-9-CM and ICD-10-CM diagnosis code categories to be
excluded from AMI episodes. However, with respect to their requested
additions to the AMI Part B exclusion list, we believe the four
categories of ICD-CM codes recommended for exclusion do not meet our
proposed Part B exclusions standards, specifically those services that
are for acute disease diagnoses unrelated to a condition resulting from
or likely to have been affected by care during the EPM episode or for
certain chronic disease diagnoses, depending on whether the condition
was likely to have been affected by care during the EPM episode or
whether substantial services were likely to be provided for the chronic
condition during the EPM episode. The ICD-CM diagnosis code categories
describe different types of cardiac arrhythmias, which can result from
an AMI, where the arrhythmia would be an acute condition related to the
AMI episode, or can be a chronic condition where the management of the
arrhythmia would be affected by the AMI treatment. Thus, we do not
agree with the commenter that these ICD-CM diagnosis code categories
should be excluded from AMI episodes.
With respect to CABG episodes, another commenter recommended almost
19,000 ICD-10-CM diagnosis codes be added to the CABG exclusion list.
The commenter submitted individual codes in 750 ICD-10-CM categories
for exclusion, of which there were 563 categories (75%) in which they
requested excluding all codes. We note that there are about 71,000
billable ICD-10-CM codes in 1,910 categories, compared to about 15,000
ICD-9-CM codes in 1,042 categories. Due to the large number of
diagnosis codes, we believe it would be operationally infeasible and
unnecessarily complex to determine excluded Part B services at the
individual diagnosis code level. We further believe that the ICD-CM
diagnosis code categories are sufficiently narrow and descriptive that
they can be appropriately used to determine Part B exclusions without
substantial risk of misidentifying services that are unrelated to CABG
episodes according to our proposed Part B exclusions standards. We have
several years of experience with 48 different BPCI clinical episodes in
Model 2, including CABG, which has a similar design to the proposed
CABG model. We have encountered no significant concerns from BPCI
Awardees or other stakeholders about our BPCI methodology which
excludes Part B services based on ICD-CM diagnosis code categories,
just as we use in the CJR model and proposed for the CABG model.
Therefore, we are continuing to consider changes to the Part B
exclusion list for the EPMs based on ICD-CM categories.
We did not perform another clinical review of the 187 categories
where the commenter only requested that we exclude some of the
individual ICD-10-CM diagnosis codes in the category, because we will
continue to exclude ICD-10-CM codes at the category level. CMS
clinicians and coding staff reviewed all of the 563 ICD-10-CM diagnosis
code categories where the commenter recommended that we exclude all the
diagnosis codes in order to make a determination about additional
exclusions at the category level. While the commenters claimed that
diagnosis codes in these categories had no clinical relevance to CABG,
we do not agree that the additional categories where the commenter
recommended 100 percent of the ICD-10-CM diagnosis codes for exclusion
meet our proposed standards for exclusion. For example, the commenter
requested that we exclude the categories K20 (Esophagitis) and I12
(Hypertensive chronic kidney disease) for Part B services from the CABG
model episode definition. However, these two ICD-10-CM diagnosis code
categories do not meet our proposed standards for the exclusion of Part
B services because they include acute disease diagnoses for a condition
arising from or likely to have been affected by care during the CABG
episode in the case of Esophagitis and chronic disease diagnoses likely
to have been affected by care during the CABG episode in the case of
Hypertensive chronic kidney disease. The commenter's recommendations
were prepared based on a standard of ``clinical relevance'' to CABG
which we believe is too narrow to define related
[[Page 261]]
Part B services for the proposed CABG model which was designed to test
comprehensive, coordinated patient-centered care for the beneficiary
throughout broadly defined EPM episodes. In our clinical review based
on the proposed standards for Part B exclusions, we determined that the
563 ICD-10-CM diagnosis code categories where the commenter recommended
that we exclude 100 percent of the diagnosis codes do not meet the
standards for exclusion from CABG episodes. Therefore, we are making no
changes to the CABG episode ICD-10-CM Part B exclusion list.
The same commenter who made recommendations about additional ICD-
10-CM diagnosis code exclusions also recommended ICD-9-CM diagnosis
codes in 436 ICD-9-CM categories for exclusion, and of those, the
commenter recommended that all codes be excluded in 336 (77 percent) of
the categories. We did not perform an additional clinical review of the
categories where the commenter only requested that we exclude some of
the individual ICD-9-CM diagnosis codes in the category, as we will
continue to exclude ICD-9-CM codes at the category level. CMS
clinicians and coding staff reviewed all of the 100 ICD-9-CM diagnosis
categories where the commenter recommended that we exclude all the
diagnosis codes in order to make a determination about additional
exclusions at the category level. Similar to our findings from our
review of the ICD-10-CM diagnosis code categories where all codes were
recommended for exclusion, the ICD-9-CM categories with all codes
recommended by the commenter for CABG episode exclusion do not meet our
proposed exclusion standards for Part B services. For example, the
commenter recommended that we exclude all codes in ICD-9-CM diagnosis
code category 584 (Acute kidney failure) and 250 (Diabetes mellitus)
from CABG episodes. However, these two ICD-9-CM diagnosis code
categories do not meet our proposed standards for the exclusion of Part
B services because they include acute disease diagnoses for a condition
arising from or likely to have been affected by care during the CABG
episode in the case of Acute kidney failure and chronic disease
diagnoses likely to have been affected by care during the CABG episode
in the case of Diabetes mellitus. In our clinical review, we found that
none of the 100 ICD-9-CM categories where the commenter recommended
that we exclude 100 percent of the diagnosis codes meet our proposed
standards for excluding Part B services from CABG episodes, so we are
making no changes to the CABG episode ICD-9-CM Part B exclusion list.
Comment: One commenter stated that their understanding was that
emergency transportation of beneficiaries with AMI would be included in
AMI episodes. The commenter pointed out that this cost could vary
substantially based on the transport mileage and the mode of transport,
with air transport being substantially more costly than ground
transport. The commenter claimed that the EPM participant where the
episode would be initiated has little or no input on the transport
method used but would be held accountable for the transportation cost
in the AMI episode. The commenter requested that transport of the
beneficiary to the AMI model participant where the AMI episode is
initiated be excluded because the AMI model participant would have
little or no control of that cost.
Response: We proposed to include all Part A and Part B items and
services in AMI episodes beginning with the admission of the
beneficiary for the anchor hospitalization and extending through anchor
hospitalization discharge, whereupon the AMI model exclusion list would
be applied to Part A and Part B items and services during the 90 days
post-discharge to make a determination about their inclusion in the AMI
episode definition. With respect to the inclusion of Part B ambulance
claims for air or ground transport in the AMI episode definition, we
would exclude those services that occurred prior to the hospital
admission. If the ambulance transport occurs on the day of initial
admission for the anchor hospitalization and has place-of-service code
for ambulance on the claim, the claim would not be included in the AMI
episode definition, an approach which would be consistent with the
specific request of the commenter.
However, if ambulance transport occurs any other time during the
anchor hospitalization, the transportation would be included in the AMI
episode definition as we include all Part B services without regard to
the Part B exclusion list, except DME to which we apply the Part B
exclusion list during the anchor hospitalization as well. Following
discharge from the anchor hospitalization, the inclusion or exclusion
of ambulance transport in the AMI episode during the 90 day post-
discharge would be determined by our proposed methodology for
determining exclusion of any Part B items and services based on the
principal diagnosis code on the claim and whether that diagnosis code
is on the AMI model exclusion list.
We note that medically appropriate air ambulance transportation is
a Medicare-covered service regardless of the state or region in which
it is rendered. However, contractors approve claims only if the
beneficiary's medical condition is such that transportation by either
basic or advanced life support ground ambulance is not appropriate.
Medical reasonableness is only established when the beneficiary's
condition is such that the time needed to transport a beneficiary by
ground, or the instability of transportation by ground, poses a threat
to the beneficiary's survival or seriously endangers the beneficiary's
health.\59\ Thus, the circumstances of covered air transport are
limited and, once the AMI episode is initiated, the AMI model
participant would have an ongoing role in beneficiary care that would
result in the participant's input into the mode of transport should
transport be required.
---------------------------------------------------------------------------
\59\ Medicare Benefit Policy Manual, Chapter 10--Ambulance
Services, 10.4 and 10.4.2.
---------------------------------------------------------------------------
Comment: One commenter recommended that CMS include the costs of
pre-operative home visits in EPM episodes, including services to
discuss goals of care and advance care planning services. Another
commenter requested that CMS account for preventive services in the
EPMs, although they acknowledged the associated challenges in
benchmarking target prices based on historical claims data. One
commenter suggested that CMS include the proposed HCPCS G-codes for the
Collaborative Care model such that screening and follow-up would be
included in the payment structure for each EPM, while another commenter
recommended CMS to make resources for care coordination strategies
available to support advancing care coordination through appropriate
pre-discharge planning and post-discharge follow up. The commenter
observed that the majority of opportunities to advance care
coordination and improve patient outcomes are in decreasing hospital
length of stay to only what is necessary for appropriate treatment,
preventing unnecessary readmissions, and controlling post-acute care
costs. The commenter stated that opportunities to improve care
coordination include strong pre-discharge planning activities;
prevention of unnecessary patient visits to the emergency department
through early recognition of decompensation; increasing appropriate
referral to cardiac rehabilitation services; and
[[Page 262]]
effective patient and family education. The commenter claimed that
ensuring the social and environmental components are in place prior to
discharge is critical and that communication of the most appropriate
post-acute care facilities to not only the patients, but to their
families and caregivers, can be essential to a patient's recovery.
Response: The only items and services that are included in EPM
episode definitions are those that are separately paid by Medicare
under Part A or Part B. We established EPM episode definitions in order
to add Medicare payments for items and services included in the EPM
episode definitions into EPM-episode benchmark prices based on
historical EPM episodes and into the calculation of actual EPM-episode
spending. In addition, we proposed that EPM episodes begin with the
anchor hospitalization. Therefore, for the same reasons as discussed in
the CJR Final Rule (81 FR 73316 through 73317) regarding LEJR episodes,
we would not include any pre-operative home visits that could be
separately paid by Medicare in the EPM episode definitions because they
would precede the initiation of the episode which begins with admission
to the hospital and discharge from an MS-DRG that is included in the
EPM.
In terms of including preventive services and potential new HCPCS
G-codes for Part B services in the Collaborative Care model in the EPM
episode definitions, we note that according to our standard methodology
for identifying excluded Part B services under the EPMs, specific Part
B services would be included in both historical EPM episodes and actual
EPM episodes to the extent that the ICD-9-CM or ICD-10-CM diagnosis
code on the claim for the preventive service or HCPCS G-code for Part B
services in the Collaborative Care model is related to the EPM episode
and, therefore, not on the EPM episode exclusion list. With regard to
CMS making specific financial resources available to EPM participants
for pre-discharge planning, post-discharge follow-up, or other care
coordination activities, EPM participants would need to develop their
own strategies and use their own resources for these activities, as
well as engage with EPM collaborators, to redesign care to achieve good
quality and cost performance under the EPMs. CMS will not provide
additional payments under the EPMs specifically for these types of
planning and follow-up activities. However, EPM participants who
achieve acceptable episode quality or better and reduce actual EPM-
episode spending below the quality-adjusted price are eligible for
payment of the difference through a reconciliation payment, which can
support the resources used by EPM participants and collaborators in
redesigning care to achieve model success.
Comment: Several commenters commended CMS for proposing to exclude
IPPS new technology add-on payments for drugs, technologies, and
services from EPM episodes, as well as OPPS transitional pass-through
payments for medical devices. They believe that these proposals would
ensure EPM beneficiaries/access to valuable new drugs, technologies,
services, and devices. The commenters recommended CMS to go further and
exclude additional innovative technologies from EPM episodes by
establishing a review process to determine whether their costs should
be excluded from EPM-episode benchmark prices and actual EPM-episode
spending. The commenters reasoned that this new review process would
allow manufacturers to identify high-cost breakthrough technologies and
treatments that offer clinical improvements for all or certain types of
patients or offer significant therapeutic advances for new populations
or conditions. The commenters recommended that CMS utilize the same
processes as those used to determine eligibility for IPPS new
technology add-on payments but without regard to the statutory or
regulatory policies that apply only to new technology approvals. They
further suggested that CMS also allow individual EPM participants to
request an EPM payment adjustment if they adopt breakthrough treatment
in advance of other hospitals, as well as manufacturers and developers
to request the adjustment.
One commenter recommended CMS to consider other innovative capital
investments for an EPM episode payment adjustment and to provide
payment for new technologies at 100 percent of their cost, not 50
percent as under current CMS programs for payment of new technologies.
Finally, another commenter suggested that CMS should provide a
financial incentive to EPM participants to use technologies that are
shown to improve patient outcomes and reduce cost within 12 to 24
months.
Response: We appreciate the support of the commenters for our
proposals regarding the exclusion of new technology payments from EPM
episodes and agree that EPM beneficiaries should have access to
beneficial new technologies while they are in EPM episodes. We do not
believe it would be appropriate for the EPMs to potentially hamper
beneficiaries' access to new technologies that are receiving IPPS new
technology add-on payments or OPPS transitional pass-through payments
or to burden EPM participants who choose to use these new drugs,
technologies, services, or devices with concerns about these payments
counting toward actual EPM-episode spending.
However, for the same reasons that were discussed previously in the
CJR Final Rule (80 FR 73308) regarding LEJR episodes, we will not
establish a new process to review innovative technologies or different
technologies that would be ineligible for a payment adjustment under
the Medicare program and make individual determinations regarding their
exclusion from the EPM episode definitions, as recommended by some
commenters. Because the EPMs are retrospective reconciliation models
that pay all providers and suppliers under the regular Medicare program
throughout the episode of care, we believe it is more appropriate to
rely on the existing processes under the Medicare program to make
determinations about separate payment for new technology items and
services. If those existing processes identify new technologies that
would qualify for add-on payments under the IPPS or transitional pass-
through payments under the OPPS, we will exclude them from the EPM
episode definitions as we proposed, to ensure that beneficiaries'
access to new technology items and services is not influenced by their
care being included in the EPMs. Similarly, under these retrospective
EPMs, we will not provide additional payments for new technologies
beyond those that are paid under the Medicare program.
Finally, we do not believe it would be appropriate under the EPMs
to provide financial incentives to EPM participants to use specific
technologies that improve beneficiary outcomes and reduce cost over any
specific period of time. We understand that because the EPMs would
extend 90 days post-discharge from the anchor hospitalization, the EPMs
specifically incentivize the use of technologies and provision of
services that improve quality and reduce cost within the limited
episode timeframe for which the EPM participant is responsible for
episode quality and cost performance. However, we believe that EPM
participants, treating physicians, and other EPM collaborators are best
positioned to select technologies and furnish services that improve the
quality of care and reduce cost for EPM beneficiaries and expect that
their
[[Page 263]]
decisions factor in the long-term interests of beneficiaries as well.
Comment: One commenter stated that there was significant evidence
demonstrating that the use of more expensive drug-eluting stents (DES)
results in better long-term outcomes in many patients and fewer repeat
procedures for in-stent restenosis. The commenter added that long-term
benefit for patients (avoiding the risk, inconvenience and cost of
secondary procedures) and to Medicare (via fewer repeat procedures in
the long term) would not be fully captured in an episode extending 90
days post hospital discharge, but the full additional costs of DESs
would be. The commenter recommended CMS take steps to ensure that the
financial models used for the EPMs do not discourage the appropriate
use of DES. The commenter claimed that if the AMI model results in
fewer beneficiaries receiving DES, long-term outcomes may deteriorate
and overall costs may grow.
Response: As discussed in section III.C.4.a.(2) of this final rule,
we would initiate AMI episodes from PCI MS-DRGs (246-251) with an AMI
ICD-CM diagnosis code in the principal or a secondary position on the
claim for the anchor hospitalization. Medicare payment for coronary
stents, whether bare metal or DES, used during a PCI performed during a
hospitalization are included in the IPPS payment for the inpatient
hospitalization. While they are not paid separately by Medicare,
payment for the required resources would be included in AMI episodes
because the IPPS services for the anchor hospitalization are included
in the episodes. We proposed to risk-stratify EPM-episode prices based
on MS-DRG as discussed in section III.D.4.b.(1) of this final rule and
there are separate MS-DRGs for PCIs that use DES (246 and 247) and non-
DES (248 and 249) for which there would be separate AMI episode prices.
Therefore, we do not believe that the financial incentives under the
AMI model encourage the use of any specific coronary stent because the
episode prices take into consideration the IPPS payment for the
specific MS-DRG that applies to the AMI model beneficiary. We do not
expect the AMI model to discourage the appropriate use of DES.
Comment: Several commenters pointed out that Arkansas and Tennessee
have bundled payment programs that include CABG episodes, and their
efforts to implement bundled payments include state Medicaid and
commercial health plans. The commenters stated that in Arkansas, the
episode definition is consistent, specifically naming the duration,
responsible entity, and the included services and conditions, across
all participating payers. If MSAs from Arkansas or Tennessee are
selected for the AMI and CABG models, the commenters recommended that
CMS should align the CABG episode definition with that of the state
Medicaid plan. The commenters stated that this approach to episode
definition would decrease the complexity and cost to providers in those
states and reduce overlapping, independent efforts at care redesign
that both hospitals and cardiac surgery groups would be simultaneously
undertaking, potentially independently. The commenters added that this
would also allow CMS to experiment with different episode definitions
than those under the BPCI initiative and CJR model and proposed for the
EPMs.
Response: We appreciate the commenters drawing our attention to the
states that are currently engaged in testing bundled payment models. We
are encouraged that several states have identified clinical conditions
that overlap with those proposed in the EPMs for testing bundled
payment models, specifically CABG and PCI in the context of acute AMI
(acute PCI). The choice of these states to test bundled payment models
for some of the same clinical conditions that are included the EPMs
provides additional support for the opportunities under our proposal of
these models for Medicare beneficiaries. Specifically, Arkansas and
Tennessee are testing CABG bundled payment models which are similar to
the CMS CABG model, while Ohio and Tennessee are testing acute PCI
bundled payment models that are similar to the subset of beneficiaries
in the CMS AMI model discharged from PCI MS-DRGs with an AMI ICD-CM
diagnosis code on the hospital claim. As displayed in section III.B.5
of this final rule, MSAs in Arkansas, Tennessee, and Ohio have been
selected for participation in the CMS AMI and CABG models.
The state and CMS models for acute PCI and CABG episodes have
similar design features. First, the responsible entity for CABG
episodes is the hospital in Tennessee (the physician in Arkansas) like
the CMS model and for acute PCI episodes in both states it is the
facility where the PCI is performed, which would most commonly be the
hospital for an acute procedure as in the CMS model where the hospital
is responsible. Second, both the state and CMS models begin with the
inpatient hospitalization (or with performance of the procedure),
although the state model episodes extend 30 days following discharge,
whereas the CMS model episodes extend 90 days. We note that for CMS
CABG episodes, 92 percent of episode spending occurs during the anchor
hospitalization and the 30 days post-discharge, while 84 percent of
acute PCI episode spending occurs during that same period of time.\60\
Thus, despite the differences in episode duration between the state and
CMS models, the large majority of episode spending occurs in the first
30 days post-discharge so the state and CMS models contain most of the
same episode spending. Third, the state and CMS models include most
services furnished in the episode post-discharge from the anchor
hospitalization, although the state models are not quite as inclusive.
Fourth, episode payments are tied to quality measures in both the state
and CMS models. Finally, both the state and CMS models included two-
sided risk and risk adjustment (or risk stratification) based on payer-
specific factors.
---------------------------------------------------------------------------
\60\ Episodes for AMI and CABG beneficiaries initiated by all
U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule, that began in CY 2012-2014.
---------------------------------------------------------------------------
Both the state and CMS CABG and acute PCI models support the
implementation and testing of bundled payment models for these costly
episodes that significantly impact the health of individuals with
cardiac disease. While it is operationally infeasible for CMS to apply
the different definitions used by state Medicaid agencies in different
states testing episode payment in an EPM of the scope of the CMS CABG
and AMI models, the state and CMS models that included CABG and acute
PCI are sufficiently similar and clinical pathways around CABG and
acute PCI care reasonably well-established such that we believe
coordination among the various providers, including hospitals and
physicians, caring for all beneficiaries in CABG and acute PCI
episodes, regardless of payer, should not pose a significant burden on
the providers involved. Although the CMS CABG model places the
responsibility for the episode upon the hospital, like the Tennessee
CABG model, the financial arrangements that are permissible for
individuals and entities that collaborate with the hospital toward the
goal of improved quality and efficiency of CABG episode care as
discussed in section III.I. of this final rule provide participant
hospitals with substantial opportunity to share upside and downside
risk with their collaborators, including physicians that might be
leading CABG bundled payment efforts
[[Page 264]]
in Arkansas. The financial arrangement policies under the CMS CABG
model should help to minimize the occurrence of independent,
potentially overlapping efforts of hospitals and physician groups to
redesign care for CABG patients covered by different insurers. We
believe that the state and CMS bundled payment models for overlapping
clinical conditions are complementary efforts that will provide
substantial new information about the effects of bundled payments on
the quality and cost of care for CABG and acute PCI. While we
understand that implementation of the EPMs will result in testing CABG
and acute PCI episodes with minor differences in design for
beneficiaries of Medicare versus Medicaid and other commercial payers
in MSAs selected for the AMI and CABG models in Arkansas, Tennessee,
and Ohio, these differences are unlikely to affect the episode care
redesign strategies of the responsible hospitals under the CMS and
state models.
Comment: While a number of commenters supported the proposal to
update the EPM excluded services through the proposed sub-regulatory
process to provide for flexibility and timeliness in adding exclusions
to EPM episodes, several commenters opposed CMS' proposal to make
changes to EPM episode exclusions through an annual, at a minimum,
update outside of rulemaking. The commenters encouraged CMS to use
notice and comment rulemaking to evaluate and exclude additional
services from EPM episodes. The commenters stated that because
participation in the EPMs is required in selected geographic areas and,
therefore, the EPMs affect a large number of hospitals and providers,
it is important that CMS implement the process to update services to be
excluded from these episodes through notice and comment rulemaking, so
that provider feedback throughout the course of EPM implementation is
reflected in CMS' decisions. They added that hospitals of different
sizes, geographic locations, organizational capabilities, and socio-
economic factors all have unique preferences, and their ideas and
opinions should be accounted for when CMS makes changes to the list of
conditions and services to be included and/or excluded from the
episodes.
Many commenters recommended CMS to continue to evaluate the list of
services to be excluded from EPM episodes. They encouraged CMS to
consider excluding a variety of additional services, including hospital
readmissions planned for the beneficiary prior to the anchor
hospitalization for consistency with other CMS policies such as the
treatment of planned readmissions under the HRRP; ongoing care for
beneficiaries' chronic conditions for which management is outside the
scope of the EPMs and their exclusion could confound the EPM test of
optimizing quality and costs for certain episodes; and post-acute care
following excluded readmissions where little is known about the causal
relationship between the hospital readmission and subsequent post-acute
care services.
Response: We appreciate the interest of the commenters in ensuring
that future changes to the EPM episode definitions involve a
transparent process with opportunity for broad stakeholder input. We
have some experience with a similar sub-regulatory update process for
the CJR model for both the list of excluded services and the fracture
ICD-10-CM diagnosis codes that are used to identify episodes for
fracture risk-stratification. We used this process after publication of
the CJR Final Rule and again more recently to update the CJR model
exclusion list for changes to the FY 2017 IPPS MS-DRGs and ICD-10-CM
diagnosis codes. We have received significant public input through
those processes, which has allowed us to consider and incorporate, as
appropriate based on the regulatory review standards for the processes,
stakeholder input and in turn communicate timely final updates to the
exclusions and fracture lists to CJR participant hospitals. We have not
heard any concerns about the sub-regulatory update processes as we have
applied them during CJR model implementation.
As we concluded for the CJR model, we continue to believe that
updating the exclusions annually, at a minimum, is most appropriate for
the 5-year EPMs, and allowing more frequent updates than through
rulemaking as necessary to accommodate timely ICD-10-CM annual coding
changes and annual IPPS MS-DRG changes, as well as to address
significant issues raised by EPM participants and other stakeholders or
by CMS as we continue to evaluate the list of excluded services for the
EPM episodes. We will explore the additional areas recommended by the
commenters and others that may arise during EPM implementation, and we
will utilize the exclusion list update process to suggest any future
changes based on our additional analyses.
The commenters who supported an exclusion list update process
outside of rulemaking did not suggest specific revisions to the
proposed standards for updating the EPM episode exclusions, namely:
We would not exclude the following items or services that
are:
++ Directly related to the EPM episode or the quality or safety of
the EPM episode care.
++ For chronic conditions that may be affected by the EPM episode
care.
We would exclude the following items and services that
are:
++ For chronic conditions not generally affected by the EPM episode
care.
++ For acute clinical conditions, not arising from existing EPM
episode-related chronic clinical conditions or complications of EPM
episode care.
Thus, we continue to believe these standards provide the
appropriate clinical review framework for updates to the EPM exclusion
list. Finally, we believe that our proposed process to post the
potential revised exclusions, which could include additions to or
deletions from the exclusion list, to the CMS Web site to allow for
public input on our planned application of these standards, and then
adopt changes to the exclusion list with posting to the CMS Web site of
the final revised exclusion list after our consideration of the public
input is consistent with the recommendation of commenters that we use a
transparent process reflective of broad opportunity for public input,
including implementation experience with the EPMs. Conducting this
update process outside of rulemaking based on the standards set forth
in this final rule allows us the greatest flexibility to update the
exclusions as changes to the MS-DRGs and ICD-10-CM diagnosis codes,
upon which our exclusions rely, are released. This process also allows
us to respond quickly to any episode definition issues that arise
during implementation of the EPMs across the broad array of EPM
participants in the selected MSAs, as well as consider any new analysis
conducted by CMS or stakeholders about the relationship among items and
services to the EPM episodes that might result in a different
assessment of the inclusion or exclusion of existing MS-DRGs or ICD-10-
CM diagnosis codes in the definition of EPM episodes. We would widely
publicize the opportunity for review and public input through the CMS
Web site and listservs. We also note that any changes to our overall
approach to identifying excluded items and services or to our standards
for evaluating items and services for exclusion would be address
through future rulemaking. Therefore, we are finalizing our proposal to
update the exclusion list annually, at a minimum, using the standards
and process as described.
[[Page 265]]
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.210(a), without
modification, to identify related items and services for EPM episodes
as the following items and services paid under Medicare Part A and Part
B, after the EPM-specific exclusions are applied:
Physicians' services.
Inpatient hospital services.
IPF services.
LTCH services.
IRF services.
SNF services.
HHA services.
Hospital outpatient services.
Independent outpatient therapy services.
Clinical laboratory services.
Durable medical equipment.
Part B drugs.
Hospice.
We are also finalizing the proposals, without modification, to use
the following standards to exclude items and services from EPM
episodes:
Hospital readmissions for MS-DRGs that group to the
following categories of diagnoses: Oncology; trauma medical admissions;
surgery for chronic conditions unrelated to a condition likely to have
been affected by care furnished during the EPM episode; and surgery for
acute conditions unrelated to a condition resulting from or likely to
have been affected by care during the EPM episode.
Part B items and services for acute disease diagnoses
unrelated to a condition resulting from or likely to have been affected
by care during the EPM episode, and certain chronic disease diagnoses,
as specified by CMS on a diagnosis-by-diagnosis basis, depending on
whether the condition was likely to have been affected by care during
the EPM episode or whether substantial services were likely to be
provided for the chronic condition during the EPM episode.
Drugs that are paid outside of the MS-DRGs included in the
EPM episode definitions, specifically hemophilia clotting factors.
IPPS new technology add-on payments for drugs,
technologies, and services.
OPPS transitional pass-through payments for medical
devices.
We are finalizing the proposals in Sec. 512.210(b) to exclude from
EPM episodes specific readmissions, Part B-covered items and services
with specific ICD-9-CM or ICD-10-CM diagnosis codes in the principal
position on claims for items and services during the 90 days post-
discharge from the anchor hospitalization, and additionally Part-B
covered DME with specific ICD-9-CM or ICD-10-CM diagnosis codes in the
principal position on claims during the anchor hospitalization, with
modification to place MS-DRGs 326-328 on the AMI MS-DRG-anchored AMI
exclusion list and MS-DRGs 266-267 on the AMI MS-DRG-anchored AMI
exclusion list and the CABG exclusion list. As discussed in section
III.C.4.a.(5) of this final rule, we are not finalizing our proposed
AMI model inpatient-to-inpatient transfer episode initiation and
attribution policy so we will not use the terms chained anchor
hospitalization and price MS-DRG in the final AMI episode definition
and pricing policies. Therefore, the applicable EPM exclusion list is
applied to the EPM episode on the basis of the MS-DRG that anchors the
EPM episode. The final EPM exclusion lists based on ICD-9-CM and ICD-
10-CM diagnosis codes and MS-DRGs as of FY 2016 are posted on the CMS
Web site at https://innovation.cms.gov/initiatives/epm.
Lastly, we are finalizing our proposals in Sec. 512.210(c) to
update the exclusion lists by sub-regulatory guidance on an annual
basis, at a minimum, to reflect annual changes to ICD-10-CM coding and
annual changes to the MS-DRGs under the IPPS, as well as to address any
other issues that are brought to our attention throughout the course of
the EPMs, without modification. The standards for this updating process
are:
Include any items or services that are directly related to
the EPM episode diagnosis or procedure (for example, a subsequent
admission for heart failure or repeat revascularization) or the quality
or safety of care (for example, sternal wound infection following
CABG);
Include items or services for chronic conditions that may
be affected by the EPM diagnosis or procedure and the post-discharge
care (for example, diabetes);
Exclude items and services for chronic conditions that are
generally not affected by the EPM diagnosis or procedure and the post-
discharge care (for example, prostate removal for cancer); and
Exclude items and services for acute clinical conditions
not arising from existing EPM episode-related chronic clinical
conditions or complications from the EPM episode (for example,
appendectomy).
The potential revised exclusions, which could include additions to
or deletions from the exclusion lists, will be posted to the CMS Web
site to allow for public input. After receiving and reviewing public
input on potential revised exclusions, we will post the final revised
exclusion lists, including providing information to the public about
when the revisions would take effect and to which episodes they would
apply.
With the publication of this final rule, we are initiating the sub-
regulatory update process to incorporate changes to the MS-DRGs and
ICD-10-CM diagnosis codes for 2017 into the EPMs by posting potential
changes to the exclusion lists for the EPMs. We did not consider the
2017 changes in the EPM proposed rule, because the final MS-DRGs and
ICD-10-CM codes were not yet available when the proposed rule was
published in the Federal Register on August 2, 2016. There are no MS-
DRG changes for FY 2017 that resulted in our suggesting potential
changes to the exclusion lists for the EPMs. We are suggesting
potential modifications to the principal ICD-10-CM diagnosis code
categories for excluded Part B services in the AMI, CABG, and SHFFT
models as of July 1, 2017, based on new ICD-10-CM diagnosis code
categories for FY 2017 and clinical review of existing ICD-10-CM
diagnosis code categories to which new ICD-10-CM diagnosis codes have
been added for FY 2017. The potential modifications to the exclusion
list for each EPM are posted on the CMS Web site at https://innovation.cms.gov/initiatives/epm. We request that public input on the
potential modifications be sent to [email protected] by 11:59 p.m. on
Friday, January 27, 2017. After receiving and reviewing public input on
potential revised exclusions, we will post the final revised exclusions
by February 24, 2017, including providing information to the public
about when the revisions will take effect and to which episodes they
would apply.
4. EPM Episodes
a. Beneficiary Care Inclusion Criteria and Beginning of EPM Episodes
(1) General Beneficiary Care Inclusion Criteria
Because of the clinical variability leading up to these EPM
episodes and the challenge of identifying unrelated services given the
multiple chronic conditions experienced by many EPM beneficiaries, we
proposed to follow the CJR model precedent and not begin an EPM episode
prior to the anchor hospitalization (80 FR 73315 and 73318). We
proposed that all services that were already included in the IPPS
payment based on established Medicare policies (for example, 3-day
payment window payment policies) would be included in these EPM
episodes, and that the defined population of Medicare beneficiaries
whose care would be included in the EPMs would meet all of
[[Page 266]]
the following criteria on admission to the anchor or chained anchor
hospitalization:
Enrolled in Medicare Part A and Part B.
Eligible for Medicare not on the basis of end-stage renal
disease.
Not enrolled in any managed care plan (for example,
Medicare Advantage, Health Care Prepayment Plans, cost-based health
maintenance organizations).
Not covered under a United Mine Workers of America health
plan, which provides health care benefits for retired mine workers.
Have Medicare as their primary payer.
Not aligned to an ACO in the Next Generation ACO model or
an ACO in a track of the Comprehensive ESRD Care Initiative
incorporating downside risk for financial losses.
Not under the care of an attending or operating physician,
as designated on the inpatient hospital claim, who is a member of a
physician group practice that initiates BPCI Model 2 episodes at the
EPM participant for the MS-DRG that would be the anchor MS-DRG under
the EPM.
Not already in any BPCI model episode.
Not already in an AMI, SHFFT, CABG or CJR model episode
with an episode definition that does not exclude the MS-DRG that would
be the anchor MS-DRG under the applicable EPM.
For a discussion of our proposal to exclude certain ACO-assigned
beneficiaries from EPM episodes, we refer to section III.D.6.c.(3) of
the proposed rule (81 FR 50869 through 50870). For a discussion of our
proposals for addressing potential overlap of beneficiaries in episode
payment models that are relevant to these last two criteria, we refer
to sections III.D.6.c.(1) and (2) of the proposed rule (81 FR 50868
through 50869).
The proposal for beneficiary care inclusion policies was included
in proposed Sec. 512.230. We sought comment on our proposal of
beneficiary care inclusion policies.
The following is a summary of the comments received and our
responses. We refer to sections III.D.6.c.(1) through (3) of this final
rule for a summary of the comments received and our responses on the
proposed three general beneficiary care inclusion criteria that relate
to beneficiaries in other CMS models and programs.
Comment: Many commenters expressed support for the proposed general
beneficiary care inclusion criteria as reasonable and consistent with
other models and programs. On the other hand, a number of commenters
requested that CMS exclude beneficiaries with certain clinical
characteristics from all three proposed EPMs, including beneficiaries
receiving hospice care before or during the episode; experiencing an
inpatient psychiatric hospitalization preceding or during an episode;
having preexisting functional disabilities in activities of daily
living; bearing a diagnosis of dementia; residing in a SNF; and
experiencing illnesses for which it is expected that the beneficiary
would be likely to die within the upcoming year. The commenters
generally stated that these beneficiaries should be excluded due to
high and variable needs for care that would not be typical for
beneficiaries in EPM episodes. One commenter recommended CMS to adopt
an ``out clause'' for the most complex patients to be exempt from the
EPMs, such as beneficiaries with multi-organ system involvement or
comorbidities or poly-chronic illnesses. The commenters were concerned
that without accurate risk adjustment under the EPMs, hospitals
disproportionately caring for these beneficiaries would experience
undue financial risk for necessary episode care. The commenters
recommended that if CMS did not exclude high-risk beneficiaries, CMS
must adopt more robust risk adjustment to account for socioeconomic,
clinical, or other risk factors that are out of the hospital's control
and impact patients' health and recovery. Several commenters
recommended that at least the initial implementation of the EPMs should
exclude vulnerable populations with complicated or intensive care needs
from the EPMs until the EPMs demonstrate sufficient quality outcomes
and have developed accurate risk adjustments and patient safeguards to
ensure high-quality care for populations that the commenters believe
could face serious care disadvantages in the EPMs and put hospitals at
an unacceptable level of financial risk.
Response: Most beneficiaries with anchor hospitalizations that
would initiate EPM episodes would have underlying conditions that may
affect care throughout the episode or that may be influenced by the
surgery or AMI that initiates the episode. Similar to our rationale in
the CJR Final Rule regarding LEJR episodes (80 FR 73371), we believe it
is important to include these beneficiaries in the EPMs so that they
can benefit from the increased opportunities for care coordination and
management throughout the episodes, and including the broadest feasible
array of Medicare beneficiaries in the EPMs provides EPM participants
with the greatest volume of episodes and incentive to redesign episode
care. We do not believe it would be appropriate to exclude
beneficiaries from the EPMs just because they are potentially expected
to have high-cost, variable health care needs under the EPMs. We refer
to section III.D.4.b.(2) of this final rule for a discussion of risk
adjustment for the EPMs. Therefore, we will not exclude additional
beneficiaries with certain clinical characteristics from the EPMs
beyond those general beneficiary care inclusion criteria that we
proposed.
Comment: Several commenters requested that CMS exclude
beneficiaries with a home address not in the service area of the
treating hospital. The commenters believe that including beneficiaries
in this scenario would result in an unfair financial and administrative
burden for EPM participants relative to other EPM beneficiaries
residing in the service area of the hospital in meeting the challenges
of remote post-discharge care coordination and ensuring ultimate
quality outcomes for medically complex out-of state-patients.
Response: We acknowledge that in occasional circumstances, EPM
participants may have limited ability to coordinate care. For similar
reasons as our discussion in the CJR Final Rule (80 FR 73317 through
73318) regarding LEJR episodes, following the care coordination that
takes place in the EPM participant during the anchor hospitalization,
we expect that much of the subsequent coordination of post-acute care
services and other related services for EPM beneficiaries during the 90
days post-discharge can be accomplished through telecommunications that
do not require the patient to remain within the geographic proximity of
the hospital responsible for the EPM episode. In addition, the design
of the EPMs does not preclude hospitals from coordinating care with
other providers outside of their immediate service area, which may be
necessary especially in the case of beneficiaries who are admitted to a
o-i or inpatient-to-inpatient (i-i) transfer hospital after an
outpatient-to-inpatient or inpatient-to-inpatient transfer,
respectively, for a different or higher level of cardiac care that is
not available at the local hospital to which they originally presented
with symptoms of an AMI. As discussed in section III.C.4.a.(5) of this
final rule, under our final AMI model policy we are canceling all AMI
episodes that begin at an initial treating hospital through an
inpatient admission that
[[Page 267]]
initiates the AMI episode when the beneficiary is transferred for
admission to an i-i transfer hospital after the AMI episode begins.
Thus, hospitals that are AMI and CABG model participants and that
receive beneficiaries in transfer either from outpatient or inpatient
status at an initial treating hospital will commonly initiate and be
responsible for AMI or CABG episodes that begin at the o-i/i-i transfer
hospital. This attribution of episodes to the o-i/i-i transfer hospital
increases the probability that the home of beneficiaries is not in the
service area of the responsible hospital under the AMI or CABG model,
yet most commenters requested that we adopt this transfer attribution
policy. Therefore, we believe that most EPM participants have the tools
to engage in effective remote care coordination that results in high
quality episode care.
Finally, we note that we are finalizing several waivers of Medicare
program rules, as discussed in section III.J. of this final rule, to
facilitate efficient and effective episode care coordination for
beneficiaries in remote or distant locations outside of the EPM
participant's immediate community. We are also finalizing policies for
financial arrangements in section III.I. of this final rule that allow
EPM participants to share upside and downside financial risk with a
variety of individuals and entities who collaborate with the EPM
participant in redesigning care and caring for EPM beneficiaries,
regardless of the geographic proximity of these individuals and
entities to the EPM participant. Through financial arrangements, EPM
participants could align the financial incentives of providers in the
EPM beneficiary's home community with the goals of the EPM participant
to improve the quality and reduce the cost of EPM episodes. Therefore,
we will not exclude beneficiaries from the EPMs who are referred to EPM
participants that are not close to the beneficiary's home.
Comment: Several commenters requested clarification about whether
patients who buy in to Medicare A or B through the Medicaid program
would be excluded from the EPMs.
Response: As long as the beneficiaries are enrolled in both
Medicare Part A and Part B, regardless of whether enrollment occurs
through Medicaid program buy in, and assuming the beneficiaries meet
the other general beneficiary care inclusion criteria, their care would
be included in the EPMs.
Comment: A commenter presented a scenario where an EPM participant
admitted and successfully treated a beneficiary with a SHFFT procedure,
but the patient later falls and has a subsequent hip fracture requiring
surgical fracture repair within the post[hyphen]acute period of the
episode. The commenter requested clarification about whether this
instance would trigger a new SHFFT episode or the cost of the
readmission to repair the second fracture would be included in the
prior SHFFT episode's total cost.
Response: During such a readmission, the beneficiary would already
be in a SHFFT episode. Therefore, the ongoing SHFFT episode would not
be canceled and a new SHFFT episode would not be initiated because the
beneficiary would not meet the proposed beneficiary care inclusion
criteria to initiate a SHFFT episode since he or she is already in a
SHFFT episode. Because SHFFT MS-DRGs 480-482 are not on the exclusion
list for SHFFT episodes, the related readmission would be included in
the ongoing SHFFT episode and its cost included in the calculation of
actual episode spending for the SHFFT episode that began with the
initial hospitalization for a SHFFT procedure.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.230 for the
general beneficiary care inclusion criteria, with modification to
remove references to chained anchor hospitalization which we are not
including in the final EPM policies as discussed in section
III.C.4.a.(5) of this final rule. We are additionally excluding from
EPM episodes beneficiaries who are assigned to a Shared Savings Program
ACO in Track 3, as discussed in section III.D.6.c.(3) of this final
rule. We define the population of Medicare beneficiaries whose care is
included in the EPM as those who meet all of the following criteria on
admission to the anchor hospitalization:
Enrolled in Medicare Part A and Part B.
Eligible for Medicare not on the basis of end-stage renal
disease.
Not enrolled in any managed care plan (for example,
Medicare Advantage, Health Care Prepayment Plans, cost-based health
maintenance organizations).
Not covered under a United Mine Workers of America health
plan, which provides health care benefits for retired mine workers.
Have Medicare as their primary payer.
Not prospectively assigned to:
++ An ACO in the Next Generation ACO model;
++ An ACO in a track of the Comprehensive ESRD Care Model
incorporating downside risk for financial losses; or
++ A Shared Savings Program ACO in Track 3.
Not under the care of an attending or operating physician,
as designated on the inpatient hospital claim, who is a member of a
physician group practice that initiates BPCI Model 2 episodes at the
EPM participant for the MS-DRG that would be the anchor MS-DRG under
the EPM.
Not already in any BPCI model episode.
Not already in an AMI, SHFFT, CABG or CJR model episode
with an episode definition that does not exclude the MS-DRG that would
be the anchor MS-DRG under the applicable EPM.
(2) Beginning AMI Episodes
We proposed that, as long as the beneficiary met the general
beneficiary care inclusion criteria, then an AMI episode would begin
with admission of a Medicare beneficiary to an IPPS hospital for the
following MS-DRGs, where the specific MS-DRG would be called the anchor
MS-DRG for the episode:
AMI MS-DRGs--
++ 280 (Acute myocardial infarction, discharged alive with MCC);
++ 281 (Acute myocardial infarction, discharged alive with CC); and
++ 282 (Acute myocardial infarction, discharged alive without CC/
MCC).
PCI MS-DRGs, when the claim includes an AMI ICD-10-CM
diagnosis code in the principal or secondary position on the IPPS claim
as specified in Table 3--
++ 246 (Percutaneous cardiovascular procedures with drug-eluting
stent with MCC or 4+ vessels/stents);
++ 247 (Percutaneous cardiovascular procedures with drug-eluting
stent without MCC);
++ 248 (Percutaneous cardiovascular procedures with non-drug-
eluting stent with MCC or 4+ vessels/stents);
++ 249 (Percutaneous cardiovascular procedures with non-drug-
eluting stent without MCC);
++ 250 (Percutaneous cardiovascular procedures without coronary
artery stent with MCC); and
++ 251 (Percutaneous cardiovascular procedures without coronary
artery stent without MCC).
Table 3 displays the ICD-9-CM codes that we proposed to use to
identify historical AMI episodes for beneficiaries discharged from PCI
MS-DRGs, as well as the ICD-10-CM diagnosis codes that would be used to
identify AMI episodes for beneficiaries discharged from PCI MS-DRGs
throughout the duration of the AMI model. The sub-regulatory process
for updating this AMI ICD-10-CM diagnosis code list was described in
[[Page 268]]
section III.C.3.a.(1) of the proposed rule (81 FR 50831).
We first identified the ICD-9-CM diagnosis codes for the initial
AMI episode-of-care that were historically used to report care for a
newly diagnosed AMI patient admitted to the hospital. These codes all
have a fifth digit of ``1'' and were applicable until the patient was
discharged from acute medical care, including for any transfers to and
from other acute care facilities that occurred. These AMI ICD-9-CM
diagnosis codes would be used to identify historical AMI episodes for
developing AMI model-episode benchmark prices for anchor PCI MS-DRGs.
We proposed to cross-walk the ICD-9-CM diagnosis codes for the initial
AMI episode-of-care to the ICD-10-CM diagnosis codes that would be
reported for similar beneficiaries during the AMI model performance
years. The crosswalk in Table 5 is consistent with the crosswalk CMS
posted for public comment regarding ICD-9-CM to ICD-10-CM diagnosis
codes used for HIQR Program measures, including AMI quality
measures.\61\
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\61\ https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Downloads/HIQR-ICD9-to-ICD10-Tables.pdf.
Table 5--Proposed ICD-9-CM and ICD-10-CM AMI Diagnosis Codes in the Principal or Secondary Position on the IPPS
Claim for PCI MS-DRGS (246-251) That Initiate AMI Episodes
----------------------------------------------------------------------------------------------------------------
ICD-10-CM
ICD-9-CM Diagnosis code ICD-9-CM Description Diagnosis code ICD-10-CM Description
----------------------------------------------------------------------------------------------------------------
410.01........................ Acute myocardial infarction of 121.09 ST elevation (STEMI) myocardial
anterolateral wall, initial infarction involving other
episode of care. coronary artery of anterior
wall.
122.0 Subsequent ST elevation (STEMI)
myocardial infarction of
anterior wall.
410.11........................ Acute myocardial infarction of 121.01 ST elevation (STEMI) myocardial
other anterior wall, initial infarction involving left main
episode of care. coronary artery.
121.02 ST elevation (STEMI) myocardial
infarction involving left
anterior descending coronary
artery.
121.09 ST elevation (STEMI) myocardial
infarction involving other
coronary artery of anterior
wall.
122.0 Subsequent ST elevation (STEMI)
myocardial infarction of
anterior wall.
410.21........................ Acute myocardial infarction of 121.10 ST elevation (STEMI) myocardial
inferolateral wall, initial infarction involving other
episode of care. coronary artery of inferior
wall.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.31........................ Acute myocardial infarction of 121.11 ST elevation (STEMI) myocardial
inferoposterior wall, initial infarction involving right
episode of care. coronary artery.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.41........................ Acute myocardial infarction of 121.19 ST elevation (STEMI) myocardial
other inferior wall, initial infarction involving other
episode of care. coronary artery of inferior
wall.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.51........................ Acute myocardial infarction of 121.29 ST elevation (STEMI) myocardial
other lateral wall, initial infarction involving other
episode of care. sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.61........................ True posterior wall infarction, 121.29 ST elevation (STEMI) myocardial
initial episode of care. infarction involving other
sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.71........................ Subendocardial infarction, 121.4 Non-ST elevation (NSTEMI)
initial episode of care. myocardial infarction.
122.2 Subsequent non-ST elevation
(NSTEMI) myocardial
infarction.
410.81........................ Acute myocardial infarction of 121.21 ST elevation (STEMI) myocardial
other specified sites, initial infarction involving left
episode of care. circumflex coronary artery.
121.29 ST elevation (STEMI) myocardial
infarction involving other
sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.91........................ Acute myocardial infarction of 121.3 ST elevation (STEMI) myocardial
unspecified site, initial infarction of unspecified
episode of care. site.
122.9 Subsequent ST elevation (STEMI)
myocardial infarction of
unspecified site.
----------------------------------------------------------------------------------------------------------------
The proposal for beginning AMI episodes was included in proposed
Sec. 512.240(a)(1). We sought comment on our proposal to begin AMI
episodes.
We address some of the comments related to the proposed AMI ICD-CM
diagnosis codes displayed in Table 5 in section III.C.3.a.(1) of this
final rule in the context of our discussion of the clinical conditions
that define AMI episodes. We received no comments specific to the ICD-
9-CM to ICD-10-CM crosswalk of the AMI ICD-CM diagnosis codes included
in Table 5.
[[Page 269]]
The following is a summary of the comments received on other issues
related to our proposal to begin AMI episodes and our responses.
Comment: Several commenters stated that uncomplicated acute AMI can
be treated and discharged the next day. They pointed out that under
Medicare's Two-Midnight rule, these beneficiaries would be classified
as outpatients. They requested clarification about whether CMS believes
these beneficiaries with AMI should be classified as inpatient even if
the expectation of the treating physician is a less than Two-Midnight
hospital stay so the AMI model would include all beneficiaries with
AMI.
Response: The AMI model does not change Medicare's current payment
policy for classifying Medicare beneficiaries as outpatients or
inpatients, including beneficiaries with AMI. Therefore, AMI model
participants should continue to follow all existing Medicare rules that
apply to classifying beneficiaries as inpatients or outpatients for
beneficiaries with AMI who could potentially initiate AMI episodes if
they were admitted to the AMI model participant.
To provide greater clarity to hospitals and physician stakeholders,
and to address the higher frequency of beneficiaries being treated as
hospital outpatients for extended periods of time, CMS adopted the Two-
Midnight rule for admissions beginning on or after October 1, 2013.
This rule established Medicare payment policy regarding the benchmark
criteria to use when determining whether inpatient admission is
reasonable and necessary for purposes of payment under Medicare Part
A.\62\ In general, the original Two-Midnight rule stated that:
---------------------------------------------------------------------------
\62\ Fact Sheet: Two-Midnight Rule; CMS; October 30, 2015.
---------------------------------------------------------------------------
Inpatient admissions would generally be payable under Part
A if the admitting practitioner expected the patient to require a
hospital stay that crossed two midnights and the medical record
supported that reasonable expectation.
Medicare Part A payment was generally not appropriate for
hospital stays expected to last less than two midnights. Cases
involving a procedure identified on the inpatient-only list or that
were identified as ``rare and unusual exception'' to the Two-Midnight
benchmark by CMS were exceptions to this general rule and were deemed
to be appropriate for Medicare Part A payment.
The Two-Midnight rule also specified that all treatment decisions
for beneficiaries were based on the medical judgment of physicians and
other qualified practitioners. The Two-Midnight rule did not prevent
the physician from providing any service at any hospital, regardless of
the expected duration of the service.
We acknowledge that full provider implementation of hospital care
in accordance with the Two-Midnight rule did not occur immediately on
October 1, 2013 and that the first CMS' contractor reviews of short
stay inpatient admissions did not begin until October 2015. Therefore,
we understand that shifts in classifying certain beneficiaries with
uncomplicated AMI as outpatients instead of inpatients could have
occurred during the period of historical AMI episodes that would span
January 1, 2013 and December 31, 2015 and would be used for setting
quality-adjusted target prices in performance years 1 and 2 of the AMI
model. Under our monitoring and evaluation activities as discussed in
sections III.G.4. through 6. and section IV. of this final rule,
respectively, we will monitor the site-of-service for treatment of
beneficiaries with AMI over the course of the model to detect any
issues related to access to care, quality of care, or delayed care. We
will also evaluate the AMI model with respect to changes in AMI case
mix for AMI model participants, and if we observe them, we would
conduct analyses about the potential causes of such changes, including
whether AMI model participants shifted to treating some uncomplicated
beneficiaries with AMI as outpatients rather than inpatients. We
further note that when we first update the data used for historical EPM
episode payments in performance year 3 of the EPMs to be calendar years
2015 through 2017, we expect that any changes in care patterns related
to the Two-Midnight rule would have been made by the beginning of that
3-year period.
Comment: One commenter agreed with CMS that it is currently rare
for a beneficiary with AMI to have an outpatient PCI and, therefore,
almost all beneficiaries with AMI who are treated with PCI would be in
the AMI model under current hospital treatment practices. However, the
commenter added that by excluding beneficiaries who receive outpatient
PCI from the AMI model, EPM participants may change their billing to
outpatient PCI, especially for more complex and costly beneficiaries
for which AMI episode costs would be expected to be high. The commenter
recommended that CMS should put all AMI patients on the inpatient only
list.
Response: We appreciate the concern expressed by the commenter
about the potential for the financial incentives in the AMI model to
lead to shifting in the site-of-service for PCI for beneficiaries with
AMI from inpatient to outpatient. We note that the OPPS inpatient only
list includes procedures that are only paid under the IPPS and does not
assign certain diagnoses to inpatient only care. PCI currently is
commonly performed in the outpatient hospital department for
beneficiaries that do not have AMI, and we do not believe it would be
appropriate to place PCI procedures on the inpatient only list due to
concerns about the shifting of the site-of-service from inpatient to
outpatient for AMI model beneficiaries who require PCI. As we stated in
the proposed rule (81 FR 50829) patients experiencing an AMI are almost
uniformly admitted to the hospital for further evaluation and
management based on clinical guidelines for the treatment of
beneficiaries with AMI.\63\ We do not believe that EPM participants
would change their patterns of treatment of beneficiaries with AMI,
especially for those complex patients with significant medical needs,
in ways that would risk beneficiaries not receiving the medically
necessary inpatient hospital evaluation and management recommended for
their AMI treatment. We will be monitoring patterns of care as
discussed in sections III.G.4. through 6. of this final rule for
evidence of clinically-unexplained changes in care, including the site-
of-service for AMI beneficiaries who receive PCI, especially if we
believe there is the potential to compromise beneficiary access to care
or quality of care or to delay care.
---------------------------------------------------------------------------
\63\ Amsterdam et al. 2014 AHA/ACC Guideline for the Management
of Patients with Non-ST--Elevation Acute Coronary Syndromes.
Circulation. 2014; 130:e344-e426.
---------------------------------------------------------------------------
Comment: A commenter requested that CMS further clarify how an EPM
participant can determine whether beneficiaries with AMI who have a
CABG would be attributed to the AMI or CABG model.
Response: We appreciate the opportunity to provide clarification on
the specific episode attribution of beneficiaries with AMI who have a
CABG. We refer to section III.D.4.a.(5) of this final rule for further
discussion of the final transfer attribution policy for AMI episodes
that involve an inpatient-to-inpatient transfer for AMI care. AMI and
CABG episodes are initiated based on the MS-DRG that is assigned to the
final discharge that occurs during the anchor hospitalization. Thus, if
a beneficiary hospitalized for treatment of AMI has a CABG during that
anchor hospitalization, we expect that the
[[Page 270]]
beneficiary would be discharged from a CABG MS-DRG (231-236) and,
therefore, would initiate a CABG episode. We refer to section
III.D.4.b.(b) of this final rule for the pricing adjustment that would
apply to CABG episodes for beneficiaries who have a CABG during the
initial hospitalization for AMI treatment. However, if a beneficiary
with an AMI hospitalized for initial treatment is discharged from the
anchor hospitalization and then readmitted for CABG during the 90 day
post-discharge episode duration, the beneficiary would initiate an AMI
episode, which would not be canceled due to the CABG readmission. We
refer to section III.D.4.b.(c) of this final rule for the pricing
adjustment that would apply to AMI episodes with CABG readmissions.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.240(a)(1),
without modification, to begin AMI episodes with admission of a
Medicare beneficiary to an IPPS hospital for the following MS-DRGs,
where the specific MS-DRG is called the anchor MS-DRG for the episode:
AMI MS-DRGs--
++ 280 (Acute myocardial infarction, discharged alive with MCC);
++ 281 (Acute myocardial infarction, discharged alive with CC); and
++ 282 (Acute myocardial infarction, discharged alive without CC/
MCC).
PCI MS-DRGs, when the claim includes an AMI ICD-10-CM
diagnosis code in the principal or secondary position on the IPPS claim
as specified in Table 6--
++ 246 (Percutaneous cardiovascular procedures with drug-eluting
stent with MCC or 4+ vessels/stents);
++ 247 (Percutaneous cardiovascular procedures with drug-eluting
stent without MCC);
++ 248 (Percutaneous cardiovascular procedures with non-drug-
eluting stent with MCC or 4+ vessels/stents);
++ 249 (Percutaneous cardiovascular procedures with non-drug-
eluting stent without MCC);
++ 250 (Percutaneous cardiovascular procedures without coronary
artery stent with MCC); and
++ 251 (Percutaneous cardiovascular procedures without coronary
artery stent without MCC).
Table 6--Final ICD-9-CM and ICD-10-CM AMI Diagnosis Codes in the Principal or Secondary Position on the IPPS
Claim for PCI MS-DRGS (246-251) That Initiate AMI Episodes
----------------------------------------------------------------------------------------------------------------
ICD-10-CM
ICD-9-CM Diagnosis code ICD-9-CM Description Diagnosis code ICD-10-CM Description
----------------------------------------------------------------------------------------------------------------
410.01........................ Acute myocardial infarction of 121.09 ST elevation (STEMI) myocardial
anterolateral wall, initial infarction involving other
episode of care. coronary artery of anterior
wall.
122.0 Subsequent ST elevation (STEMI)
myocardial infarction of
anterior wall.
410.11........................ Acute myocardial infarction of 121.01 ST elevation (STEMI) myocardial
other anterior wall, initial infarction involving left main
episode of care. coronary artery.
121.02 ST elevation (STEMI) myocardial
infarction involving left
anterior descending coronary
artery.
121.09 ST elevation (STEMI) myocardial
infarction involving other
coronary artery of anterior
wall.
122.0 Subsequent ST elevation (STEMI)
myocardial infarction of
anterior wall.
410.21........................ Acute myocardial infarction of 121.10 ST elevation (STEMI) myocardial
inferolateral wall, initial infarction involving other
episode of care. coronary artery of inferior
wall.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.31........................ Acute myocardial infarction of 121.11 ST elevation (STEMI) myocardial
inferoposterior wall, initial infarction involving right
episode of care. coronary artery.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.41........................ Acute myocardial infarction of 121.19 ST elevation (STEMI) myocardial
other inferior wall, initial infarction involving other
episode of care. coronary artery of inferior
wall.
122.1 Subsequent ST elevation (STEMI)
myocardial infarction of
inferior wall.
410.51........................ Acute myocardial infarction of 121.29 ST elevation (STEMI) myocardial
other lateral wall, initial infarction involving other
episode of care. sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.61........................ True posterior wall infarction, 121.29 ST elevation (STEMI) myocardial
initial episode of care. infarction involving other
sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.71........................ Subendocardial infarction, 121.4 Non-ST elevation (NSTEMI)
initial episode of care. myocardial infarction.
122.2 Subsequent non-ST elevation
(NSTEMI) myocardial
infarction.
410.81........................ Acute myocardial infarction of 121.21 ST elevation (STEMI) myocardial
other specified sites, initial infarction involving left
episode of care. circumflex coronary artery.
121.29 ST elevation (STEMI) myocardial
infarction involving other
sites.
122.8 Subsequent ST elevation (STEMI)
myocardial infarction of other
sites.
410.91........................ Acute myocardial infarction of 121.3 ST elevation (STEMI) myocardial
unspecified site, initial infarction of unspecified
episode of care. site.
[[Page 271]]
122.9 Subsequent ST elevation (STEMI)
myocardial infarction of
unspecified site.
----------------------------------------------------------------------------------------------------------------
(3) Beginning CABG Episodes
We proposed that, as long as a beneficiary met the general
beneficiary care inclusion criteria, a CABG episode would begin with
the admission of a Medicare beneficiary to an IPPS hospital for a CABG
that is paid under the following CABG MS-DRGs and the specific MS-DRG
would be called the anchor MS-DRG for the episode:
231 (Coronary bypass with percutaneous transluminal
coronary angioplasty (PTCA) with MCC).
232 (Coronary bypass with PTCA without MCC).
233 (Coronary bypass with cardiac catheterization with
MCC).
234 (Coronary bypass with cardiac catheterization without
MCC).
235 (Coronary bypass without cardiac catheterization with
MCC).
236 (Coronary bypass without cardiac catheterization
without MCC).
The proposal for beginning CABG episodes was included in proposed
Sec. 512.240(b)(1). We sought comment on our proposal to begin CABG
episodes.
The following is a summary of the comments received and our
responses.
Comment: One commenter recommended that CMS begin elective CABG
prior to admission for the anchor hospitalization, since all of the
workup prior to an elective CABG happens in the weeks or months before
the hospitalization. The commenter claimed that the patient workup can
vary considerably among providers, which may result in unnecessary
costs. As an example, the commenter stated that a patient could have
every cardiac diagnostic test prior to CABG when only several may be
necessary. To help address unnecessary utilization prior to elective
CABG, the commenter recommended that CMS begin the episode for elective
CABG prior to the hospitalization for surgery.
The commenter further disagreed with CMS' proposal that elective
and urgent CABG would be included in one EPM, because the beneficiaries
behave differently during the episode and with respect to their risk
profiles. The commenter recommended that CMS separate CABG under these
two circumstances into separate EPMs and test both models.
Response: We appreciate the interest expressed by the commenter in
starting CABG episodes prior to the hospital admission, and we
recognize that the beneficiary's care that ultimately leads to the
CABG, including the physician-patient relationship and diagnostic
workup, can begin long before the surgical procedure. However, for
similar reasons to our consideration of analogous comments in the CJR
Final Rule (81 FR 73316 through 73317) regarding LEJR episodes,
beginning the episode too far in advance of the CABG would make it
difficult to avoid bundling unrelated items and services, and starting
the episode prior to the hospital admission is more likely to encompass
costs that vary widely among beneficiaries with CAD that are potential
candidates for CABG, which would make the episode more difficult to
price appropriately. We continue to believe that beginning the CABG
episode with the anchor hospitalization is most appropriate due to the
clinical variability leading up to the CABG and the challenge of
distinguishing between related and unrelated services. We also believe
that beginning the episode with the anchor hospitalization, and not
prior to admission, would be easier to administer and provide more
consistent episodes for testing the CABG model.
Furthermore, we agree with the commenter that beneficiaries
experiencing elective versus urgent CABG behave differently during the
episode due to their different health care needs. However, rather than
creating two EPMs for these beneficiaries for whom we believe the same
CABG episode definition would apply, we are providing a pricing
adjustment as discussed in section III.D.4.b.(2)(b) of this final rule
for CABG model beneficiaries with an AMI diagnosis code on the claim
for the anchor hospitalization who have substantially higher historical
episode spending than CABG model beneficiaries without AMI. The two
groups correspond to the urgent versus elective groups recommended by
the commenter. We believe this pricing adjustment policy accomplishes
the major objective of the commenter who recommended two CABG EPMs so
that we price CABG episodes for the two groups of CABG model
beneficiaries differently based on their different patterns of health
care utilization.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. 512.240(b)(1),
without modification, to begin CABG episodes with the admission of a
Medicare beneficiary to an IPPS hospital for a CABG that is paid under
the following CABG MS-DRGs and the specific MS-DRG is called the anchor
MS-DRG for the episode:
231 (Coronary bypass with percutaneous transluminal
coronary angioplasty (PTCA) with MCC).
232 (Coronary bypass with PTCA without MCC).
233 (Coronary bypass with cardiac catheterization with
MCC).
234 (Coronary bypass with cardiac catheterization without
MCC).
235 (Coronary bypass without cardiac catheterization with
MCC).
236 (Coronary bypass without cardiac catheterization
without MCC).
(4) Beginning SHFFT Episodes
We proposed that as long as a beneficiary met the general inclusion
criteria, a SHFFT episode would begin with the admission of a Medicare
beneficiary to an IPPS hospital for surgical treatment of hip or femur
fracture (other than joint replacement) that is paid under the
following SHFFT MS-DRGs and where the specific MS-DRG would be called
the anchor MS-DRG for the episode:
480 (Hip and femur procedures except major joint with
MCC).
481 (Hip and femur procedures except major joint with
complication or comorbidity (CC).
482 (Hip and femur procedures except major joint without
CC or MCC).
The proposal for beginning SHFFT episodes was included in proposed
Sec. 512.240(c)(1). We sought comment on our proposal to begin SHFFT
episodes.
We received no comments specific to our proposal to begin SHFFT
episodes.
Final Decision: We are finalizing the proposals in Sec.
512.240(c)(1), without modification, to begin SHFFT episodes with the
admission of a Medicare beneficiary to an IPPS hospital for
[[Page 272]]
surgical treatment of hip or femur fracture (other than joint
replacement) that is paid under the following SHFFT MS-DRGs and where
the specific MS-DRG is called the anchor MS-DRG for the episode:
480 (Hip and femur procedures except major joint with
MCC).
481 (Hip and femur procedures except major joint with
complication or comorbidity (CC).
482 (Hip and femur procedures except major joint without
CC or MCC).
(5) Special Policies for Hospital Transfers of Beneficiaries With AMI
The asymmetric distribution of cardiac care across hospitals makes
transfer, either from an inpatient admission or from the emergency
department (without inpatient admission) of one hospital to another, a
common consideration in the treatment course for beneficiaries with an
initial diagnosis of AMI. Therefore, transfer for cardiac care is an
important consideration for the AMI and CABG models.
The availability of revascularization and intensive cardiac care
are particularly important considerations in the transfer of
beneficiaries with an AMI. A substantial portion of hospitals do not
have revascularization capability (that is, a cardiac catheterization
lab for PCI or cardiothoracic surgeons who can perform CABG) or
cardiovascular intensive care units (CVICU) and, therefore, must
transfer beneficiaries to provide access to these services. In the PCI
and CABG examples, the discharge from the transfer hospital that
accepted the beneficiary would result in discharge under the MS-DRGs
for PCI (246-251) or CABG (231-236). For the CVICU example, the
transfer hospital's discharge MS-DRG would be AMI (280-282). There is
evidence of the asymmetric distribution of cardiac care in the 2014
IPPS and critical access hospital claims data: While 4,332 hospitals
submitted at least one claim for an AMI MS-DRG, only 1,755 (41 percent)
and 1,156 (27 percent) of these hospitals filed at least one claim for
PCI or CABG MS-DRGs, respectively.\64\
---------------------------------------------------------------------------
\64\ AMI, CABG and PCI MS-DRG inpatient claims from all U.S.
IPPS hospitals and CAHs derived from the 2014 Geographic Variations
Inpatient Claims File located in the Chronic Conditions Warehouse.
---------------------------------------------------------------------------
The potential transfer scenarios are best illustrated by the care
pathways experienced by beneficiaries with AMI. These beneficiaries
typically present to a hospital's emergency department where the
evaluation identifies the AMI diagnosis and determines the initial
indicated treatments. Depending on the beneficiary's clinical needs and
the hospital's treatment capacity, the beneficiary could be--
Admitted to the initial treating hospital, with no
transfer to another hospital during the initial hospitalization for
AMI. We refer to this scenario as no transfer;
Admitted to the initial treating hospital and later
transferred to a transfer hospital. We refer to this scenario as
inpatient-to-inpatient transfer and the transfer hospital as an i-i
transfer hospital; or
Transferred from the initial treating hospital to a
transfer hospital without admission to the initial treating hospital.
We refer to this scenario as outpatient-to-inpatient transfer and the
transfer hospital as an o-i transfer hospital.
Our proposals and alternatives considered for these scenarios are
described in detail in this section. In our proposals for AMI or CABG
episodes for initial AMI care, our overarching policy was that every
AMI or CABG episode would begin at the first AMI or CABG model
participant to which the beneficiary was admitted for an AMI MS-DRG,
PCI MS-DRG with an AMI ICD-CM diagnosis code, or CABG MS-DRG. The AMI
or CABG model participant where the episode began would then be
financially responsible for the AMI or CABG episode unless the episode
was canceled.
Based on our analysis of Medicare claims data, in the proposed rule
(81 FR 50836) we presented the finding that about 75 percent of
historical AMI episodes and CABG episodes for beneficiaries with AMI
began through the emergency department of the hospital where the anchor
hospitalization for the AMI or CABG episode would occur. In another 18
percent of historical AMI episodes and CABG episodes for beneficiaries
with AMI, the anchor hospitalization occurred at a transfer hospital
following an emergency department visit at another hospital without
admission to that hospital for an MS-DRG that would initiate an AMI or
CABG episode.\65\
---------------------------------------------------------------------------
\65\ Episode for beneficiaries with AMI initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in the proposed rule, that end in CY
2014.
---------------------------------------------------------------------------
In each of these scenarios, policies to determine which episode
type would apply, the beginning of the episode, and the specific
hospital with financial responsibility for the episode must be
determined (for example, AMI or CABG, if CABG is provided as an initial
treatment in an outpatient-to-inpatient or inpatient-to-inpatient
scenario). In the proposed rule, we discussed each of the scenarios in
detail and provide a summary of the scenarios in Table 7.
In the no transfer scenario, the episode would begin upon admission
to an AMI or CABG model participant under circumstances that meet the
criteria discussed in sections III.C.4.a.(1) and (2) or (3) of the
proposed rule (81 FR 50847 through 50848), and the AMI or CABG episode
that applied would be determined by the specific MS-DRG for the anchor
hospitalization. Financial responsibility for the episode would be
attributed to the sole treating hospital involved in the initial AMI
care. Under this proposal, the treating hospital's quality measure
performance would determine the effective discount factor to be applied
to the AMI or CABG model benchmark episode price for the episode at
reconciliation as described in section III.D.4.b.(10) of the proposed
rule (81 FR 50861 through 50862).
The inpatient-to-inpatient transfer scenario had several potential
outcomes. If the beneficiary initially presented for AMI care to a
hospital that was not an AMI model participant and was admitted and
then transferred to an i-i transfer hospital that was an AMI or CABG
model participant, the episode would first initiate at the i-i transfer
hospital and, therefore, the i-i transfer hospital would be financially
responsible for the AMI or CABG episode. The i-i transfer hospital's
quality measure performance would determine the effective discount
factor to be applied to the AMI or CABG model benchmark episode price
for the episode at reconciliation as described in section
III.D.4.b.(10) of the proposed rule (81 FR 50861 through 50862).
If a beneficiary initially presented for AMI care to an AMI model
participant and was admitted and then transferred to an i-i transfer
hospital (hereinafter a chained anchor hospitalization) and the i-i
transfer hospital was not an AMI or CABG model participant, the episode
would initiate at the initial treating hospital and would only be
canceled for beneficiaries discharged from the i-i transfer hospital
under MS-DRGs that were not anchor MS-DRGs for AMI or CABG episodes as
discussed in section III.C.4.b. of the proposed rule (81 FR 50841
through 50842). The initial treating hospital's quality measure
performance would determine the effective discount factor to be applied
to the AMI or CABG model benchmark episode price for the episode at
reconciliation as described in section III.D.4.b.(10) of the proposed
rule (81 FR 50861 through 50862). We also refer to section
III.D.4.b.(2)(a) of the proposed rule (81 FR 50849 through 50851) for
[[Page 273]]
further discussion of our proposal for price MS-DRGs that could differ
from the anchor MS-DRG in AMI episodes that included a chained anchor
hospitalization, in order to provide pricing adjustments for episodes
where the initial treating hospital was responsible for the AMI
episode.
Inpatient-to-inpatient transfers between AMI and CABG model
participant hospitals were further considered in this section and
specifically included beneficiaries experiencing an AMI who were
transferred for revascularization (that is, PCI or CABG) or a higher
level of medical AMI care. We noted that of all beneficiaries
experiencing an AMI in historical episodes, about half received no
revascularization (PCI or CABG) during the anchor hospitalization or
the 90-day post-hospital discharge period, about 40 percent received a
PCI, and less than 10 percent had CABG surgery.\66\ Moreover, three-
quarters of CABG procedures and over 90 percent of PCIs for
beneficiaries experiencing an AMI occurred at the hospital that first
admitted the beneficiary for an inpatient hospitalization.\67\
---------------------------------------------------------------------------
\66\ Episodes for beneficiaries with AMI initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in the proposed rule, that end in CY
2014.
\67\ Episodes for beneficiaries with AMI initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in the proposed rule, that end in CY
2014.
---------------------------------------------------------------------------
However, given the asymmetric distribution of cardiac care
capacity, we noted in the proposed rule (81 FR 50837) that there would
be beneficiaries who initiated an AMI episode by admission to an
initial treating hospital but then required transfer to an i-i transfer
hospital for additional treatment during the AMI episode, resulting in
a chained anchor hospitalization. For historical AMI episodes ending in
CY 2014, only about 12 percent of beneficiaries who would have
initiated an AMI episode through admission and assignment to an AMI MS-
DRG at the initial treating hospital were transferred to an i-i
transfer hospital, with 30 percent and 20 percent receiving PCI or
CABG, respectively, at the i-i transfer hospital. Another 20 percent
were discharged from the i-i transfer hospital in the chained anchor
hospitalization under an AMI MS-DRG. The remaining 30 percent of
beneficiaries were discharged from the i-i transfer hospital in the
chained anchor hospitalization under other MS-DRGs that would not have
initiated AMI or CABG episodes, including cardiac valve surgery,
septicemia, and renal failure. From the perspective of hospital
capacity and transfer patterns, most hospitals transferred less than 10
percent of beneficiaries initiating a historical AMI episode under an
AMI MS-DRG at the first admitting hospital, and only a handful of
hospitals transferred the majority of their patients in this
scenario.\68\ This small number of hospitals that transferred the
majority of their patients included a range of urban and rural
hospitals with 50 to 250 beds.
---------------------------------------------------------------------------
\68\ Episodes for AMI beneficiaries initiated by all U.S. IPPS
hospitals and constructed using standardized Medicare FFS Parts A
and B claims, as proposed in the proposed rule, that end in CY 2014.
---------------------------------------------------------------------------
The need to transfer a beneficiary in an AMI episode during the
anchor hospitalization for appropriate care that resulted in a chained
anchor hospitalization where the hospitals were both AMI or CABG model
participants raised considerations about whether attribution of the AMI
episode should be to the first treating hospital that admitted the
beneficiary or the i-i transfer hospital, as well as considerations
about the specific model (AMI or CABG) for attribution of the episode
in some circumstances. For example, if the first treating hospital
initiated an AMI episode by admitting a beneficiary and then
transferred the beneficiary to another hospital where the beneficiary
was treated and ultimately discharged from acute care, ending the
chained anchor hospitalization under a CABG MS-DRG, then we needed to
determine whether the beneficiary would be included in the AMI or CABG
model, which hospital would assume financial responsibility for the
beneficiary's episode, and under what circumstances, if any, would the
AMI episode be canceled if a transfer occurred.
In considering the model episode that would include the
beneficiary's care and accountability for the beneficiary in inpatient-
to-inpatient transfer scenarios between AMI and CABG model participant
hospitals that resulted in a chained anchor hospitalization for AMI,
several factors were relevant, including the timing of final discharge
disposition of the beneficiary, including to post-acute care; the
location of the post-acute care; the identity and location of the
physician who was most responsible for managing the beneficiary's care
after discharge; and consistency with other CMS transfer policies. We
noted in the proposed rule (81 FR 50837) that while 64 percent of CABG
beneficiaries in historical episodes received post-acute care services
following discharge from the anchor hospitalization (most commonly home
health services--43 percent received home health services only and 13
percent a combination of home health and SNF services), only 36 percent
of historical AMI beneficiaries received post-acute services.\69\ Of
further relevance for beneficiaries with an AMI diagnosis was that
significant follow up care was usually performed by cardiologists who
managed the patient's underlying cardiovascular disease, rather than
the interventional cardiologist or cardiothoracic surgeon that
performed the revascularization procedure. PCI procedures, billed by
interventional cardiologists, have a 0-day global period, reflecting
that follow up care is not typically furnished by interventional
cardiologists. We further noted that patients in commercial programs
that require travel to regional centers of excellence for CABG
generally only stay in the remote location away from the patient's home
for a week or so post-hospital discharge. We expected that
beneficiaries hospitalized for treatment of AMI, even if they were
transferred to a revascularization hospital resulting in a chained
anchor hospitalization, would receive most follow up care in their
local communities, a view that was supported by many commenters on the
CJR model proposed rule who believed that many patients requiring post-
acute care prefer to return to their home communities for that care
following hospital discharge (80 FR 23457). Finally, consistency across
other CMS program policies when a beneficiary with an AMI experienced
an inpatient-to-inpatient transfer was relevant to developing policies
for the AMI and CABG models. Specifically, we noted that the Hospital-
Level, Risk-Standardized Payment Associated with a 30-Day Episode of
Care for AMI (NQF #2431) measure used in the hospital value-based
purchasing (HVBP) Program attributes payments for transferred
beneficiaries to the hospital that admitted the patient for the initial
AMI hospitalization.\70\
---------------------------------------------------------------------------
\69\ Episodes for AMI and CABG beneficiaries initiated by all
U.S. IPPS hospitals and constructed using standardized Medicare FFS
Parts A and B claims, as proposed in the proposed rule, that end in
CY 2014.
\70\ https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/HospitalQualityInits/Measure-Methodology.html.
---------------------------------------------------------------------------
Based on these considerations, we proposed that once an AMI episode
was initiated at an AMI model participant hospital through an inpatient
hospitalization, the AMI episode would continue under the financial
responsibility of that participant hospital, regardless of whether the
[[Page 274]]
beneficiary was transferred to another AMI or CABG model participant
hospital for further medical management of AMI, or for a PCI or CABG
during a chained anchor hospitalization. Under this proposal, the
initial treating hospital's quality measure performance would determine
the effective discount factor to be applied to the AMI model benchmark
episode price for the episode at reconciliation as described in section
III.D.4.b.(10) of the proposed rule (50861 through 50862) rule. Our
proposal to cancel AMI episodes for beneficiaries discharged from the
i-i transfer hospital under MS-DRGs that were not anchor MS-DRGs for
AMI or CABG episodes was discussed in section III.C.4.b. of the
proposed rule (81 FR 50841 through 50842). We also referred to section
III.D.4.b.(2)(a) of the proposed rule (81 FR 50849 through 50851) for
further discussion of the proposal for price MS-DRGs that could differ
from the anchor MS-DRG in AMI episodes that included a chained anchor
hospitalization, in order to provide pricing adjustments for episodes
where the initial treating hospital was responsible for the AMI
episode.
In the proposed rule (81 FR 50838), we noted that we did not
propose to cancel the AMI episode even if the transfer and admission to
the i-i transfer hospital would otherwise initiate a CABG episode at
the i-i transfer hospital. We believed that once the AMI episode had
been initiated, all related care during the episode (including hospital
care for transfers and related readmissions for CABG) should be fully
attributed to the AMI episode in the manner described in this section
for the episode and that the first hospital that initiated the AMI
episode should be financially responsible for the AMI episode.
Therefore, we did not propose to cancel the AMI episode if a CABG was
performed during a chained anchor hospitalization, nor did we propose
that a beneficiary could simultaneously be in an AMI and CABG episode
for overlapping periods of time due to the different MS-DRGs that
applied during the chained anchor hospitalization. Instead, we would
make an AMI episode pricing adjustment for these circumstances by
paying the AMI model participant based on a price MS-DRG that was
different from the anchor MS-DRG to reflect Medicare payment for the
CABG as discussed in section III.D.4.b.(2)(a) of the proposed rule (81
FR 50849 through 50851).
We considered several alternatives to our proposal for AMI episode
attribution for inpatient-to-inpatient transfer scenario where both
hospitals are AMI or CABG model participants. First, we considered
canceling the AMI episode initiated at the initial treating hospital
when a transfer occurs, and basing any AMI or CABG episode initiation
on the MS-DRG for the final i-i transfer hospital admission in the
chained anchor hospitalization as long as that latter hospital was an
AMI or CABG model participant. This would place financial
responsibility for the episode on the i-i transfer hospital if the
beneficiary went on to be discharged from acute care at that hospital.
Attributing episodes under this alternative policy would assign
beneficiaries to the final i-i transfer hospital for the AMI or CABG
episode based on the model episode definitions in sections
III.C.4.a.(2) and (3) of the proposed rule (81 FR 50834 through 50835).
That is, if the beneficiary was discharged from the final admission in
the chained anchor hospitalization under an AMI MS-DRG or a PCI MS-DRG,
then the AMI episode initiated at the initial treating hospital would
be canceled and the i-i transfer hospital accepting the beneficiary on
referral would initiate an AMI episode. Similarly, if the beneficiary
was discharged from the final admission in the chained anchor
hospitalization under a CABG MS-DRG, then the AMI episode initiated at
the first hospital would be canceled and the i-i transfer hospital
accepting the beneficiary on referral would initiate a CABG episode.
Under this alternative, the i-i transfer hospital's quality measure
performance would determine the effective discount factor to be applied
to the AMI or CABG model benchmark episode price for the episode at
reconciliation as described in section III.D.4.b.(10) of the proposed
rule (81 FR 50861 through 50862). However, we did not propose this
alternative because we believed that post-acute care and care
management following hospital discharge would be more likely to be
effectively provided near the beneficiary's home community, rather than
near the i-i transfer hospital accepting the beneficiary upon referral.
Second, we considered proposing an episode hierarchy such that,
during a chained anchor hospitalization, the most resource-intensive
MS-DRG during the whole chained anchor hospitalization would determine
the model episode and the financially responsible hospital for the
episode. For example, if we established CABG, PCI, and AMI MS-DRGs in
descending order of inpatient hospital resource-intensity, we would
initiate a model episode based on the most resource-intensive MS-DRG
during the chained anchor hospitalization and attribute the model
episode to the hospital discharging the beneficiary under that MS-DRG.
Under this scenario, either the initial treating or i-i transfer
hospital's quality measure performance would determine the effective
discount factor to be applied to the AMI or CABG model benchmark
episode price for the episode at reconciliation as described in section
III.D.4.b.(10) of the proposed rule (81 FR 50861 through 50862),
depending on the specific hospital discharging the beneficiary under
the most resource-intensive MS-DRG during the chained anchor
hospitalization. However, we did not propose this alternative because
we believed, like the first alternative we considered, this could
frequently lead to episode responsibility being attributed to the i-i
transfer hospital when the local hospital first caring for the
beneficiary with AMI may be better positioned to coordinate care in the
beneficiary's home community.
Thus, our proposal would have placed responsibility for care during
the 90-day post-hospital discharge period in the AMI episode on the AMI
model participant hospital to which the beneficiary initially presented
for AMI care and was admitted, rather than on the i-i transfer hospital
to which the beneficiary was transferred after initiating the AMI
episode. Given the broad episode definition of AMI episodes, we
believed that the post-discharge care required following
hospitalization that included CABG, PCI, or medical management was best
coordinated and managed by the hospital that originally admitted the
beneficiary for the AMI. Such post-discharge care could include follow
up for adherence to cardiac rehabilitation referral and management of
the beneficiary's underlying CAD and comorbidities. Even in the case of
the more common surgical complications of CABG, such as wound
infection, the beneficiary commonly would be admitted to the local
hospital for treatment.
We further proposed that, as discussed in section III.I.3. of the
proposed rule (81 FR 50918 through 50920), hospitals could be
collaborators in the AMI, CABG, and SHFFT models in order to increase
the financial alignment of hospitals and other EPM collaborators with
EPM participants that were financially responsible for EPM episodes.
Therefore, we expected that community hospital participants in the AMI
model would be able to enter into sharing arrangements with i-i
transfer hospitals accepting AMI model beneficiaries on referral to
allow sharing of episode reconciliation payments or
[[Page 275]]
repayment responsibility with the i-i transfer hospitals if those
hospitals played a significant role in care redesign of AMI or CABG
care pathways or management of beneficiaries throughout AMI or CABG
episodes, including during the 90 days post-hospital discharge. We
expected that community hospitals would need to coordinate closely with
i-i transfer hospitals accepting AMI model beneficiaries on referral as
the beneficiaries in AMI episodes were discharged from those hospitals,
in order to improve the quality and efficiency of AMI episodes. This
coordination could potentially be enhanced if i-i transfer hospitals
were AMI model collaborators with financial incentives that were
aligned with those of the AMI model participants through sharing
arrangements.
The proposal for AMI episode attribution in circumstances that
involve inpatient-to-inpatient transfers of beneficiaries with AMI was
included in proposed Sec. 512.240(a)(2). We sought comment on our
proposal for AMI episode attribution in circumstances that involved
inpatient-to-inpatient transfers of beneficiaries with AMI, including
comment on the alternatives considered.
In the outpatient-to-inpatient transfer scenario where a
beneficiary with AMI was transferred from the emergency department of
the initial treating hospital without admission to that hospital as an
inpatient to an o-i transfer hospital for admission, we proposed that
the AMI or CABG episode would begin at the o-i transfer hospital based
on the MS-DRG (and AMI ICD-CM diagnosis code if a PCI MS-DRG applies)
that was assigned to that anchor hospitalization. That is, if a
beneficiary received initial AMI care in a hospital emergency
department without admission and was transferred to an AMI or CABG
model participant (the o-i transfer hospital) for admission, then the
AMI or CABG episode would begin in the first hospital involved in the
beneficiary's AMI or CABG care that admitted the beneficiary as an
inpatient, specifically the o-i transfer hospital. Therefore, the o-i
transfer hospital would be financially responsible for the AMI or CABG
episode. This attribution was in accordance with the AMI and CABG model
rules, as discussed in sections III.C.4.a.(2) and (3) of the proposed
rule (81 FR 50834 through 50835), that initiated an AMI episode with a
hospitalization that results in discharge from an AMI MS-DRG or PCI MS-
DRG with an AMI ICD-CM diagnosis code in the principal or secondary
position from an AMI model participant or a CABG episode with a
hospitalization that resulted in discharge from a CABG MS-DRG. Under
this proposal, the o-i transfer hospital's quality measure performance
would determine the effective discount factor to be applied to the AMI
or CABG model benchmark episode price for the episode at reconciliation
as described in section III.D.4.b.(10) of the proposed rule (81 FR
50861 through 50862). Under this proposal, regardless of whether the
initial treating hospital was an AMI or CABG model participant, an AMI
or CABG episode would only be initiated at the o-i transfer hospital if
that hospital was an AMI or CABG model participant.
We considered an overarching alternative policy that would begin
every AMI or CABG episode at the first AMI or CABG model participant at
which either:
The beneficiary presented to the emergency department for
initial AMI care before being transferred to an o-i transfer hospital;
or
The beneficiary was admitted for an AMI MS-DRG, PCI MS-DRG
with an AMI ICD-CM diagnosis code, or a CABG MS-DRG.
The AMI or CABG model participant where the episode began would
then be financially responsible for the AMI or CABG episode unless the
episode was canceled. Under this alternative, there would no changes to
our proposals for attributing episodes with no transfers or inpatient-
to-inpatient transfers.
However, under this alternative, if the beneficiary presented for
initial AMI care to the emergency department of an AMI or CABG model
participant, the AMI or CABG episode would begin at this initial
treating hospital when a beneficiary was transferred from the emergency
department for his or her first inpatient hospitalization which
occurred at an o-i transfer hospital. This would place financial
responsibility for the AMI or CABG episode on the initial treating
hospital despite the fact that the beneficiary was transferred from
that hospital without being admitted, and the initial treating
hospital's quality measure performance would determine the effective
discount factor to be applied to the AMI or CABG model benchmark
episode price for the episode at reconciliation as described in section
III.D.4.b.(10) of the proposed rule (81 FR 50861 through 50862).
Identifying the emergency department visit at the initial treating
hospital would require using Field (Form Locator) 15--Point of Origin
for Admission or Visit code on the CMS 1450 IPPS claim from the o-i
transfer hospital to identify transfer from another hospital and
linking that claim to the hospital outpatient claims from the initial
treating hospital for the emergency department visit and other hospital
outpatient services that occurred within a certain period of time prior
to the o-i transfer hospital admission and that were related to the AMI
care. The episode would be assigned to the AMI model even if the
beneficiary received a CABG at the o-i transfer hospital, and we would
assign financial responsibility for the AMI episode to the initial
treating hospital. Under this alternative, the initial treating
hospital's quality measure performance would determine the effective
discount factor to be applied to the AMI model benchmark episode price
for the episode at reconciliation as described in section
III.D.4.b.(10) of the propose rule (81 FR 50861 through 50862). We
would also need to identify other types of related services to include
in the episode that would begin prior to the o-i transfer hospital
admission, such as physicians' services for care in the emergency
department.
This alternative would have had the benefit of consistently
including all care in each AMI or CABG episode that occurred following
presentation of a beneficiary with AMI to the emergency department of
an AMI or CABG model participant to the AMI or CABG episode, regardless
of whether an AMI or CABG episode involved no transfer, o-i transfer,
or i-i transfer. However, because this alternative would have begun the
AMI episode prior to the initial hospital admission, we would have
needed to establish additional policies for identifying the
beneficiaries who initiated these episodes and defined the timeframe
and services that would have been included in the AMI or CABG episode
prior to admission to the o-i transfer hospital.
We did not propose this alternative because we believed the
policies necessary to begin the AMI or CABG episode at the first
treating hospital when an inpatient hospitalization did not occur would
be complex, challenging to operationalize, and required assumptions
about the relationship of care to the AMI based solely on
administrative claims data that were insufficient to ensure we could
accurately identify related care. We believed it remained problematic
to define the services to be included in AMI or CABG episodes if those
services preceded an inpatient hospitalization that would otherwise
initiate the AMI or CABG episode. For example, we would need to define
the timeframe for beginning an AMI or CABG episode with an emergency
department visit for AMI that resulted in a transfer to the o-
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i transfer hospital, as well as the Part A and Part B services to be
included in the AMI or CABG episode that would result. As we discussed
in section III.C.4.a.(1) of the proposed rule (81 FR 50834), we did not
propose to begin any EPM episode prior to the anchor hospitalization
because of the clinical variability leading up to all EPM episodes and
the challenge of identifying unrelated services prior to the inpatient
hospitalization. Thus, we did not propose to make an exception for
transfers from the emergency department of the initial treating AMI or
CABG model participant hospital when the beneficiary with AMI was not
admitted to that hospital.
We sought comment on the proposal for AMI and CABG episode
initiation and attribution for the outpatient-to-inpatient transfer
scenario, as well as the alternative considered that would begin an
episode upon presentation of a beneficiary for initial AMI care to the
emergency department of an AMI or CABG model participant when the care
resulted in an outpatient-to-inpatient transfer.
Table 7 included in the proposed rule (81 FR 50840) provided a
summary of episode initiation and attribution at the beginning of AMI
care for no transfer, inpatient-to-inpatient transfer, and outpatient-
to-inpatient transfer scenarios, including a description of how these
related to the participation in the AMI or CABG models of hospitals
providing initial AMI care.
Table 7--Proposed Initiation and Attribution of AMI and CABG Episodes
That Involve No Transfer, or Outpatient-to-Inpatient or Inpatient-to-
Inpatient Transfers at the Beginning of AMI Care
------------------------------------------------------------------------
Proposed episode initiation and
Scenario attribution
------------------------------------------------------------------------
No transfer (participant): Beneficiary Initiate AMI or CABG episode
admitted to an initial treating based on anchor
hospital that is a participant in the hospitalization MS-DRG.
AMI or CABG model for an AMI MS-DRG, Attribute episode to the
PCI MS-DRG with AMI ICD-CM diagnosis initial treating hospital.
code, or CABG MS-DRG.
No transfer (nonparticipant): No AMI or CABG episode is
Beneficiary admitted to an initial initiated.
treating hospital that is not a
participant in the AMI or CABG model
for an AMI MS-DRG, PCI MS-DRG with AMI
ICD-CM diagnosis code, or CABG MS-DRG.
Inpatient-to-inpatient transfer Initiate AMI or CABG episode
(nonparticipant to participant): based on the MS-DRG at i-i
Beneficiary admitted to an initial transfer hospital.
treating hospital that is not an AMI Attribute episode to the i-i
or CABG model participant and later transfer hospital.
transferred to an i-i transfer
hospital that is an AMI or CABG model
participant for an AMI MS-DRG, PCI MS-
DRG with AMI ICD-CM diagnosis code, or
CABG MS-DRG.
Inpatient-to-inpatient transfer Initiate AMI or CABG episode
(participant to participant or based on anchor
participant to nonparticipant): hospitalization MS-DRG at
Beneficiary admitted to an initial initial treating hospital. If
treating hospital that is an AMI or the chained anchor
CABG model participant for an AMI MS- hospitalization results in a
DRG, PCI MS-DRG with AMI ICD-CM final AMI, PCI, or CABG MS-
diagnosis code, or CABG MS-DRG and DRG, calculate episode
later transferred to an i-i transfer benchmark price based on the
hospital for an AMI, PCI, or CABG MS- AMI, PCI or CABG MS-DRG with
DRG, regardless of whether the i-i the highest IPPS weight. If
transfer hospital is an AMI or CABG the final MS-DRG is not an
model participant. AMI, PCI, or CABG MS-DRG,
cancel the episode. Attribute
episode to the initial
treating hospital.
Outpatient-to-inpatient transfer Initiate AMI or CABG episode
(nonparticipant to participant or based on anchor
participant to participant): hospitalization MS-DRG at o-i
Beneficiary transferred without transfer hospital. Attribute
admission from the initial treating episode to the o-i transfer
hospital, regardless of whether the hospital.
initial treating hospital is an AMI or
CABG model participant, to a o-i
transfer hospital that is an AMI or
CABG model participant and is
discharged from the o-i transfer
hospital for an AMI MS-DRG, PCI MS-DRG
with AMI ICD-CM diagnosis code, or
CABG MS-DRG.
Outpatient-to-inpatient transfer No AMI or CABG episode is
(participant to nonparticipant): initiated.
Beneficiary transferred without
admission from the initial treating
hospital that is an AMI or CABG
participant to an o-i transfer
hospital that is not an AMI or CABG
model participant.
------------------------------------------------------------------------
The following is a summary of the comments received and our
responses.
Comment: A number of commenters expressed support for the proposed
AMI model transfer episode initiation and attribution policy that would
initiate an AMI episode under the responsibility of an initial treating
hospital that is an AMI model participant where the beneficiary is
assigned to an AMI MS-DRG or PCI MS-DRG with AMI ICD-CM diagnosis code
and the beneficiary is later transferred to another hospital and
ultimately discharged from an AMI, PCI, or CABG MS-DRG. One commenter
further recommended that CMS consider implementing this policy in the
BPCI initiative and future episode payment models that are under
development. Several commenters stressed the importance of
beneficiaries receiving rehabilitation services in their home
communities to improve adherence to the treatment plan, and
acknowledged that CMS' AMI model transfer attribution proposal would
encourage this care pattern. Another commenter pointed out that CMS
should differentiate patient-directed presentation with AMI at a
hospital emergency department versus emergency medical services-
directed delivery to the hospital emergency department. The commenter
explained that the usual practice in the case of STEMI identified in
the field by emergency medical services would be to transport the
beneficiary to a hospital with appropriate capacity to avoid any need
for transfer that could delay treatment and impair outcomes. The
commenter added that the trend nationally for emergency medical
services delivery of patients with an AMI is for the patient to be
taken to a facility that is capable of managing that patient rather
than taking them to the closest hospital. Thus, the commenter believes
the transfer issues should be only applicable to the minority of
beneficiaries who present to the emergency department under their own
power.
Other commenters who supported the proposed AMI model transfer
episode initiation and attribution policy, including the proposal to
cancel
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episodes that contain a chained anchor hospitalization with a final
discharge MS-DRG that is not an AMI, PCI, or CABG MS-DRG, however
expressed concern that the proposal for a price MS-DRG payment
adjustment does not go far enough to provide a level playing field for
AMI episodes involving a chained anchor hospitalization. One of these
commenters presented analysis showing that while only a minority of
episodes involving a chained anchor hospitalization resulted in a final
discharge MS-DRG other than an AMI, PCI, or CABG MS-DRG, the episode
costs were very high in those cases because they were atypical. The
commenter concluded that CMS' proposal to cancel these episodes was
appropriate.
Additional analysis by the commenter demonstrated that hospitals
that transfer AMI beneficiaries frequently are more likely to be
smaller community hospitals with much higher episode spending, who
would be penalized by the lack of a more robust transfer-adjustment
methodology just because they do not have the most sophisticated
cardiac care available. Several commenters stated that these hospitals
often have no choice but to transfer their most complicated patients to
larger, tertiary hospitals so that the patients can receive the most
appropriate cardiac care and that hospitals should not be penalized for
doing so. These commenters requested that CMS exclude the IPPS amount
paid to the initial admitting hospital when calculating quality-
adjusted target prices and actual episode spending to put these
hospitals on a more level playing field with larger referral hospitals
that offer comprehensive cardiac care in order to encourage the best
provision of care to beneficiaries in AMI episodes. Additionally, the
commenters recommended that CMS provide additional explanation of the
framework for chained anchor hospitalizations in the final rule and
include illustrative examples about how the methodology works.
One commenter expressed support for the second of the two
alternatives considered by CMS for attributing AMI episodes in
inpatient-to-inpatient transfer scenarios that would begin an AMI
episode and assign episode responsibility to the hospital in the
chained anchor hospitalization discharging the beneficiary under the
most resource-intensive MS-DRG according to a hierarchy of CABG, PCI,
and AMI MS-DRGs in descending order of inpatient hospital resource-
intensity. The commenter reasoned that in comparison with CMS'
proposal, this approach would provide a more direct association in the
transfer policy between hospital episode responsibility and the
hospital providing the highest level of care for the beneficiary with
AMI during the chained anchor hospitalization. The commenter stated
that if a hospital admits a beneficiary but then has to transfer the
beneficiary to another hospital for more advanced cardiac care that the
initial treating hospital cannot provide, it does not seem reasonable
to make that initial hospital responsible for all follow up care post-
discharge for that condition.
The majority of commenters opposed CMS' proposed AMI model transfer
episode initiation and attribution policy, with the majority addressing
the inpatient-to-inpatient transfer scenario where the initial treating
hospital and the i-i transfer hospital are both AMI and CABG model
participants. In general, the commenters believe the inpatient-to-
inpatient transfer proposal was too complex and would be unmanageable
for EPM participants. They stated that while CMS partially predicated
its AMI model transfer episode initiation and attribution proposal on
public input on the CJR model that beneficiaries often prefer to
receive follow up care after hospital discharge in their community, the
AMI and CABG models are sufficiently different from the CJR model that
this perspective may not apply to the proposed models. In the AMI and
CABG models, the commenters emphasized that beneficiaries would be more
likely to require emergent care and, therefore, have less of an
opportunity to seek care from a facility located outside of their
region. Thus, the commenters believe that many AMI model beneficiaries
experiencing a chained anchor hospitalization during their initial
hospital treatment for AMI would remain in the same region as the i-i
transfer hospital for post-acute care services, in contrast to
primarily elective LEJR under the CJR model where procedures may be
planned in advance and involve farther travel for the surgery. Thus,
the commenters reasoned that the initial treating hospital and the i-i
transfer hospital caring for a beneficiary in an AMI episode would be
likely to be in the same region as one another and the beneficiary's
home community. Thus, they concluded that CMS' interest in AMI model
attribution policy for inpatient-to-inpatient transfers that could
support beneficiary follow up in their own community following
discharge could be met equally well through AMI episode attribution to
the i-i transfer hospital as to the initial treating hospital.
Therefore, for inpatient-to-inpatient transfer scenarios for AMI
model beneficiaries, many commenters who disagreed with CMS' proposal
recommended CMS to adopt the first alternative considered for i-i
transfers once an AMI episode is initiated at the initial treating
hospital. Consistent with CMS' discussion of this alternative
considered in the proposed rule (81 FR 50838), the commenters
encouraged CMS to cancel the AMI episode initiated at the initial
treating hospital every time an inpatient-to-inpatient transfer occurs,
and base any AMI or CABG episode initiation on the MS-DRG for the final
i-i transfer hospital admission in the chained anchor hospitalization
if the i-i transfer is an AMI or CABG model participant. This would
place financial responsibility for the episode on the i-i transfer
hospital if the beneficiary went on to be discharged from acute care at
that hospital and the hospital was an AMI or CABG model participant.
The commenters claimed this approach would greatly simplify the
initiation, attribution, and pricing methodologies under the AMI and
CABG models.
The commenters favoring AMI episode initiation and episode
assignment to the i-i transfer hospital contended that CMS' proposal to
assign AMI episode responsibility to the initial treating hospital
could encourage the initial treating hospital to either prematurely
transfer patients who present to the emergency department with symptoms
of AMI or not transfer AMI patients at all to retain control of the
episode and its associated costs. The commenters speculated that while
these hospital responses could be clinically appropriate, it is unclear
whether this would be the best approach for beneficiaries and whether
long-term this type of transfer policy within the AMI model could
reduce the capacity of small and rural hospitals to effectively manage
care for cardiac patients, while creating an overreliance on larger
hospitals.
The commenters stated that CMS' proposal placed too much importance
on the role of the local hospital and physicians associated with the
initial AMI treatment and too little importance on the role of the
hospital providing the majority of the AMI care. They maintained that
the i-i transfer hospital would be more likely to influence the post-
discharge plan and post-acute care the beneficiary receives and would
be in a better position to retain financial responsibility for the
beneficiary and assume final risk for the EPM episode. The commenters
claimed that it is the
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discharging i-i transfer hospital that would develop the discharge
plan; make recommendations on the type of post-acute care services
necessary and make arrangements with specific post-acute care
providers; schedule follow up appointments; educate the beneficiary and
caregivers about the beneficiary's clinical condition; and communicate
post-discharge instructions.
In addition, several commenters pointed out that the initial
treating hospital may not know the beneficiary's final MS-DRG until
days after discharge from the i-i transfer hospital. They stated that
this time lag makes it problematic to assign episode responsibility to
the initial treating hospital because that hospital would not be able
to identify and intervene with AMI model beneficiaries prior to their
discharge from acute care, a care redesign strategy that the commenters
believe is important for AMI model success. Some commenters stated that
CMS failed to appreciate the complexity of accurate beneficiary
identification and its impact on facilitating effective post-acute care
services in the proposed AMI model transfer policy.
A number of commenters recognized CMS' intent to link transferring
hospitals with larger, tertiary hospitals through the AMI model
transfer episode initiation and attribution proposal in order to
strengthen the quality and efficiency of health care within
communities. The commenters agreed that there needs to be increased
communication and collaboration among these hospitals in order to
achieve better patient outcomes, yet they also believe that ongoing
challenges with the timely communication of beneficiary information
among providers and the current competitive healthcare landscape are
not conducive to this type of collaboration.
In general, many commenters expressed concern that the complexity
of the AMI model's proposed transfer attribution policies and the
potential resulting confusion about beneficiary notification and
hospital episode responsibility in an environment that lacks
established electronic tracking programs that can communicate among
many hospitals in different systems. Several commenters believe the
proposed policy could focus an AMI model participant's limited
resources on administrative issues that do not actually improve care
and reduce episode costs for AMI beneficiaries. They stated that
hospital time and resources would be better spent improving care,
developing sharing arrangements among providers, and tracking
beneficiary outcomes. The commenters emphasized that this is especially
true since transfers are expected to occur in a small minority of AMI
episodes.
The majority of commenters also expressed various concerns about
potential beneficiary harm due to AMI model transfer policies under an
EPM, whether those proposed or recommended by some of the commenters,
that would establish new financial incentives for hospitals around
transfers for beneficiaries with AMI in the absence of clear best
transfer practices for hospitals with varying levels of cardiac care
capacity. The commenters claimed that CMS' proposal did not include
sufficient protections against EPM participants engaging in adverse
patient selection to improve quality and cost performance in each type
of transfer scenario (no transfer, outpatient-to-inpatient, and
inpatient-to-inpatient). The commenters believe that inappropriate
transfers and cost-shifting among competitors in a geographic market
could occur under the AMI model, and they recommended to CMS to provide
robust patient protections and transfer methodologies in the final
rule.
Most commenters expressed support for CMS' proposal to initiate AMI
episodes upon admission to the o-i transfer hospital in an outpatient-
to-inpatient transfer scenario, as well as attribute responsibility for
the episode to the o-i transfer hospital. The commenters agreed with
CMS that this approach would not require potentially flawed assumptions
about the relatedness of services preceding the hospital admission and,
therefore, would result in clearly defined AMI episodes. However,
several commenters recommended CMS to address the operational issues
identified in the proposed rule (81 FR 50839) related to outpatient-to-
inpatient transfers that would not allow CMS to begin AMI episodes when
an initial treating hospital provides only outpatient emergency care
prior to transfer to an o-i transfer hospital. The commenters believe
it would be important to mitigate these concerns in order to avoid the
potential unintended consequences of unnecessary and medically
inappropriate outpatient-to-inpatient beneficiary transfers.
Due to the complexity of transfer scenarios and the lack of clarity
about the best approaches to caring for beneficiaries with AMI under an
EPM in communities with varying cardiac care capacity distributed among
hospitals in the region, several commenters further recommended that
CMS gather clinical expert advice through an advisory panel or other
dialogue with stakeholders to further explore the AMI model transfer
policy consequences on hospitals' willingness to transfer patients.
Finally, many commenters recommended CMS to provide clarification and
ongoing guidance and support to AMI model participants related to
transfers and episode attribution and monitor for any unintended
consequences of the final AMI model transfer episode initiation and
attribution policies.
Response: We appreciate the variety of perspectives of the
commenters on the proposed AMI model transfer episode initiation and
attribution policies. We agree with the commenters that this area of
policy is both complex and significant under the AMI model, given the
variety of care patterns experienced by beneficiaries with AMI and the
variation in cardiac care capacity among hospitals. The transfer policy
has substantial implications for AMI and CABG model participants with
varying cardiac care capacity, beneficiaries who experience transfers
during emergency treatment of AMI, and CMS due to the potential for the
AMI model transfer policy to result in changes in transfer patterns
that do not improve the quality or efficiency of care for beneficiaries
with AMI, both those beneficiaries included the model and those whose
care is not included in the AMI model. We recognized the importance of
considering the potential advantages and disadvantages of various
approaches to AMI model transfer episode initiation and attribution for
beneficiaries and hospitals in our extensive discussion in the proposed
rule (81 FR 50838 through 50840) about alternatives considered for
outpatient-to-inpatient and inpatient-to-inpatient transfer scenarios.
We also continue to believe that collaboration among community
hospitals and referral hospitals with more advanced cardiac care
capacity is important to improving the quality and efficiency of health
care in communities, especially for beneficiaries with conditions
requiring emergency evaluation and treatment such as AMI.
We considered the analysis provided by some commenters and the
commenters' different perspectives on the proposed AMI model transfer
episode initiation and attribution proposal and the alternatives
considered, including the potential for unintended consequences under
any transfer policy we would establish for the AMI model. At this point
in time, we appreciate that there are important advantages and
disadvantages to each of the potential AMI model transfer
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episode initiation and attribution policies that require ongoing
consideration over the longer-term during AMI model implementation in
order to optimize the interests of beneficiaries, hospitals, and CMS,
while limiting the risk of unintended consequences that could create
problems for beneficiaries, hospitals, and CMS. For example, several
commenters stressed that changes to current AMI transfer patterns under
transfer policies of the AMI model that encourage the initial treating
hospital to either more quickly transfer patients who present to the
emergency department with symptoms of AMI or not transfer AMI patients
at all to retain control of the episode and its associated cost could
be clinically appropriate but also could reflect premature transfers
that were not medically necessary or a care pattern that poses a risk
to beneficiaries' health. Thus, while we are finalizing a policy now to
address transfer situations under the AMI model to allow for
implementation of the model, we are also coupling this policy with
heightened monitoring and evaluation of transfers of Medicare AMI
beneficiaries to and from AMI and CABG model participants and may
propose refinements to the policy or payment adjustments in the future
depending on our findings.
With respect to the policy for outpatient-to-inpatient transfers of
beneficiaries with AMI, we proposed to begin AMI and CABG episodes upon
the first inpatient admission to a treating hospital that is an AMI or
CABG model participant, rather than in the outpatient department of the
initial treating hospital that did not admit the beneficiary. In the
proposed rule (81 FR 50839), we also considered an overarching
alternative policy that could begin every AMI and CABG episode at the
first AMI or CABG model participant at which the beneficiary was either
admitted for an AMI MS-DRG, PCI MS-DRG with an AMI ICD-CM diagnosis
code, or CABG MS-DRG or presented to the emergency department for
initial AMI care (including observation status) before being
transferred to an o-i transfer hospital. However, we are not beginning
AMI or CABG episodes with care furnished by an AMI or CABG model
participant when the beneficiary is not admitted as an inpatient to
that hospital. Given the commenters' concerns about our proposal to
begin AMI episodes at the initial treating hospital under the
circumstance of an inpatient-to-inpatient transfer, we believe that
beginning AMI episodes at a hospital furnishing only emergency AMI care
could interfere with the hospital's focus on emergency stabilization
and transfer of the beneficiary. It could also place an undue burden on
the initial treating hospital for long-term responsibility for the AMI
episode in which the initial treating hospital had a role that was
limited to stabilization prior to transfer for AMI treatment. We would
not expect the initial treating hospital in these circumstances to be
substantially involved in the beneficiary's AMI treatment after the
initial emergency care. The commenters confirmed our concerns, as
discussed in the proposed rule (81 FR 50839), that this approach would
be complex, challenging to operationalize, and require assumptions
about the relationship of care to the AMI based solely on
administrative claims data that would be insufficient to ensure we
could accurately identify related care.
Thus, we have concluded that it remains problematic to define the
services to be included in AMI episodes if those services precede an
inpatient hospitalization that would otherwise initiate the AMI or CABG
episode. As we discuss in section III.C.4.a.(1) of this final rule, we
are not beginning an EPM episode prior to the anchor hospitalization
because of the clinical variability leading up to all EPM episodes and
the challenge of identifying unrelated services prior to the inpatient
hospitalization. Thus, we will not make an exception for transfers from
the emergency department or observation status of the initial treating
AMI or CABG model participant when the beneficiary with AMI is not
admitted to that hospital. As discussed in sections III.G.4. through 6.
and IV. of this final rule, we will be engaged in monitoring and
evaluation specifically as they relate to the risks associated with
this policy of adverse patient selections that could result in
increased transfers of complex beneficiaries with AMI to other
hospitals so that an AMI model participant can avoid high-cost
episodes. Should we observe concerning outpatient-to-inpatient transfer
patterns, we may engage in future rulemaking to refine the AMI episode
initiation policy or to make a payment adjustment for this scenario.
With respect to the proposed policy for inpatient-to-inpatient
transfers, we appreciate the detailed comments on the proposal as well
as on the two alternatives considered in the proposed rule (81 FR
50838). In response to the commenters who contended that the proposal
to assign AMI episode responsibility to the initial treating hospital
in an inpatient-to-inpatient transfer scenario could increase premature
transfers, we are unclear that this would be the case since we also
proposed not to initiate AMI episodes based only on care in the
outpatient department. Thus, we believe it would be more likely
expected that AMI model participants pursuing early transfer would
transfer the beneficiary prior to admission to the hospital. However,
we are concerned that the proposal to assign AMI episode responsibility
to the initial treating hospital could lead to beneficiaries not being
transferred in circumstances where they need a higher level of cardiac
care, as a number of commenters claimed.
We appreciate the support of the commenter for the second
alternative we discussed in the proposed rule (81 FR 50838) for
inpatient-to-inpatient transfer, which would assign AMI or CABG episode
responsibility to the hospital in the chained anchor hospitalization
discharging the beneficiary under the most resource-intensive MS-DRG
according to a hierarchy of CABG, PCI, and AMI MS-DRGs in descending
order of inpatient hospital resource-intensity. While we continue to
believe that this alternative could have merit by placing AMI episode
responsibility on the hospital that furnished the most intensive
treatment to the AMI beneficiary during the chained anchor
hospitalization, we are not adopting this policy due to concerns about
the episode attribution complexity that it would present. Many
commenters pointed out significant challenges for AMI model
participants that would arise under our proposal to assign AMI episode
responsibility consistently to the initial treating hospital that
admitted the beneficiary regarding the ability of AMI model
participants to meet the requirements of the model, such as timely
beneficiary notification. They also raised concerns about the
timeliness of the responsible hospital's identification of model
beneficiaries especially if the hospital is not the one discharging the
beneficiary from acute care and stated that a delay in beneficiary
identification could seriously impede the hospital's ability to
intervene with AMI and CABG model beneficiaries to begin coordinating
care prior to hospital discharge. Thus, we believe that an inpatient-
to-inpatient transfer policy that assigns AMI episode responsibility in
some cases to the initial treating hospital and in other cases to the
i-i transfer hospital depending on the different MS-DRGs during the
chained anchor hospitalization would be even more
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complex and could lead to even greater hospital confusion than our
proposal.
We also considered the potential for making a payment adjustment
while holding the initial treating hospital accountable for the AMI
episode as recommended by a number of commenters, in order to put
hospitals with lesser cardiac care capacity that more frequently need
to transfer AMI beneficiaries on a more level playing field with
hospitals that can themselves furnish comprehensive cardiac care. While
this recommendation from the commenters would be operationally feasible
and address some of the concerns raised by commenters about the
transfer incentives inherent in our proposal, while maintaining the
responsible hospital for the AMI episode in an inpatient-to-inpatient
transfer scenario as the initial treating hospital that would be most
likely to be in the beneficiary's community, this recommendation would
add even greater complexity to the AMI model pricing methodology,
already an area of significant concern to the commenters. This
refinement also would not address the challenges for the initial
treating hospital raised by other commenters related to timely
beneficiary identification and notification. Therefore, we are not
adopting this recommendation for the AMI model. However, we note that
because we are changing the responsible hospital for AMI and CABG
episodes that involve inpatient-to-inpatient transfers in our final
policy as discussed later in this section, we believe the commenters'
interest in creating a more level playing field among AMI model
participants that transfer beneficiaries to variable degrees is
addressed through that final policy.
Most commenters favored the first alternative we discussed in the
proposed rule (81 FR 50838) for AMI model transfer episode initiation
and attribution in the inpatient-to-inpatient transfer scenario.
Specifically, this policy would cancel the AMI episode initiated at the
initial treating hospital that is an AMI model participant when any
inpatient-to-inpatient transfer occurs. The beneficiary would initiate
a new AMI or CABG episode at the i-i transfer hospital if that hospital
is an AMI or CABG model participant and the MS-DRG for that
hospitalization is an AMI MS-DRG, PCI MS-DRG with AMI ICD-CM diagnosis
code, or CABG MS-DRG. If the i-i transfer hospital is not an AMI or
CABG model participant, then the beneficiary would not be included in
any AMI or CABG episode regardless of the MS-DRG assigned. This
approach would place financial responsibility for the AMI or CABG
episode on the i-i transfer hospital if the beneficiary went on to be
discharged from acute care at that hospital. Episode initiation and
attribution in this way addresses the concerns of commenters about
establishing a level playing field for AMI model participants that more
frequently transfer beneficiaries for AMI treatment because it would
not hold those hospitals accountable for AMI episodes with inpatient-
to-inpatient transfers that are, on average, higher-cost than AMI
episodes without transfers.
This approach also addresses the commenters' significant concerns
about the potential burden our proposal would have placed on the
initial treating hospital to track beneficiaries transferred to the i-i
transfer hospital and determine if they were discharged from the i-i
transfer hospital under an MS-DRG that would assign the beneficiary to
an AMI episode for which the initial treating hospital would be
responsible. The resources necessary for the initial treating hospital
to coordinate with the i-i transfer hospital that was actually
discharging the beneficiary around the discharge and follow up plan
could be substantial, given that the i-i transfer hospital would hold
the discharge planning responsibility for that beneficiary. It is not
clear that the opportunity for the initial treating hospital to enter
into financial arrangements to share upside and/or downside risk with
the i-i transfer hospital as discussed in section III.I. of this final
rule would have been sufficient to incentivize the degree of timely
collaboration and coordination by the i-i transfer hospital that would
be needed by the responsible initial treating hospital.
Therefore, we believe the most prudent final AMI model transfer
episode initiation and attribution policy at this time is to cancel the
AMI episode initiated at the initial treating hospital whenever an
inpatient-to-inpatient transfer occurs, and base any new AMI or CABG
episode initiation on the MS- DRG for the i-i transfer hospital
admission if the i-i transfer hospital is an AMI or CABG model
participant. This attribution approach is simple and unambiguous. It
eliminates the need for us to adopt the concept of chained anchor
hospitalization altogether, as well as the complex policy that would
have established a price MS-DRG that could be different from the MS-DRG
that was assigned to the hospitalization that initiates the AMI
episodes as discussed in section III.D.4.b.(2)(a) of this final rule.
We do not believe there is a need to make any additional pricing
adjustments for inpatient-to-inpatient transfer scenarios that include
more than one IPPS payment for continuous acute care services in the
beginning of AMI episodes in order to ensure a level playing field for
hospitals that more commonly transfer beneficiaries for AMI treatment.
By making the hospital ultimately discharging the beneficiary from
acute care responsible for the AMI or CABG episode and beginning the
episode at that hospital, we reduce the hospital's uncertainty as much
as possible around identifying beneficiaries in the model. In the
inpatient-to-inpatient transfer scenario, the uncertainty about
identification of beneficiaries who were transferred is no different
than if all the care for the beneficiary occurred at a single hospital.
We also do not hold a hospital financially responsible for inpatient or
outpatient hospital and Part B services that precede the beneficiary's
admission to the responsible hospital, services the responsible
hospital would be unable to influence according to the commenters.
While we are finalizing this AMI model transfer episode initiation
and attribution policy at this time for the AMI model that differs from
our proposal for the reasons discussed, we continue to have some
concerns about the care patterns that could be perpetuated and changes
that could be incentivized by the policy. First, we recognize that this
policy does not encourage any efficiencies in the transfer patterns of
beneficiaries with AMI, while we know that episodes which include
inpatient-to-inpatient transfers in the beginning of AMI care are
costly for the Medicare program. A recent analysis by DataGen of 90-day
episodes of care for AMI found that nationally, Medicare payments (that
is, costs to the program) for AMI acute care transfers (not just those
receiving PCI) were second only to the costs for patients going to
long-term care.\71\ This analysis is consistent with information
provided by the commenters that AMI episodes that include inpatient-to-
inpatient transfers are significantly more costly than AMI episodes
that do not include such transfers. The analysis identified three
scenarios for AMI care as follows:
---------------------------------------------------------------------------
\71\ The Truth Behind Variation in Episode Payments; May 5,
2014. Accessed October 18, 2016 at http://www.beckershospitalreview.com/finance/the-truth-behind-variation-in-episode-payments.html.
---------------------------------------------------------------------------
In hospitals that are licensed to perform PCIs, a patient
who is admitted with AMI and needs a PCI receives his or her full
treatment at that hospital. This results in one MS-DRG assignment and
payment for the PCI.
[[Page 281]]
In hospitals not licensed to perform PCIs, a patient
admitted with an AMI who needs a PCI is assigned an AMI MS-DRG at the
initial treating hospital and then transferred to an i-i transfer
hospital for the PCI. This results in two MS-DRG payments, one for the
AMI care and one for the PCI. In this case, the inpatient acute care
costs for the initial AMI treatment are substantially higher. The
analysis found that the average length-of-stay at the initial treating
hospital was 3 days, but it was not possible to determine from
administrative claims whether that relatively long length-of-stay was
due to patient stabilization or the need to wait for the PCI to be
scheduled at the i-i transfer hospital.
In hospitals that are licensed to perform PCIs, a patient
who is admitted with an AMI and needs a PCI receives some care at the
initial treating hospital and then is transferred to an i-i transfer
hospital for the PCI. This also results in two MS-DRG payments and
substantially higher inpatient acute care costs for the initial AMI
treatment
In summary, medically unnecessary or inappropriate inpatient-to-
inpatient transfers lead to inefficiencies in initial AMI treatment,
yet both the second and third scenarios may provide opportunities for
care redesign. However, the final AMI model transfer episode initiation
and attribution policy is not able to test such opportunities at this
time.
In addition to not creating incentives for transfer efficiency, the
final AMI model policy may create additional incentives for an AMI
model participant to transfer complex beneficiaries or beneficiaries
with potentially avoidable complications resulting from AMI treatment
who would be expected to result in high-cost episodes to i-i transfer
hospitals. Transfers could occur to i-i transfer hospitals that are
also participants in the AMI model where the costs of care at the
initial treating hospital would not be included in the AMI episode
initiated at the i-i transfer hospital or to hospitals outside the MSA
that would not be participants in the AMI model. Such transfer patterns
could ultimately result in either complex beneficiaries or those with
complications resulting from the initial AMI treatment
disproportionately not being the financial responsibility of the
initial AMI model treating hospital or not being included in the AMI
model at all.
Given these concerns about the potential missed opportunities and
unintended consequences due to the final AMI model transfer episode
initiation and attribution policy, we will be examining AMI transfers
to and from AMI model participants very closely through our monitoring
and evaluation activities as discussed in sections III.G.4. through 6.
and IV. of this final rule, both of beneficiaries that ultimately are
included in AMI episodes and those that are not. We may revisit the
transfer policy or propose payment adjustments through future
rulemaking if we see reduced AMI transfer efficiency; opportunities to
increase transfer efficiency; disproportionate transfers of complex AMI
beneficiaries suggesting that AMI model participants are engaging in
adverse patient selection; high rates of transfers of beneficiaries
with potentially avoidable complications of AMI treatment at the
initial treating hospital; inordinate loss of beneficiaries from the
AMI model due to transfer outside of the MSAs where the AMI and CABG
models are being tested; or other patterns of concern.
The final policies for initiation and attribution of AMI and CABG
episodes that involve no transfer, outpatient-to-inpatient transfer, or
inpatient-to-inpatient transfers at the beginning of AMI care are
summarized in Table 8.
Comment: One commenter requested that CMS establish a transfer
attribution policy for the SHFFT model as well, because beneficiaries
with SHFFT are occasionally transferred from the initial treating
hospital to another hospital for SHFFT surgery. The commenter
recommended that the SHFFT episode be attributed to the transfer
hospital, that is, the hospital receiving the beneficiary upon transfer
from the initial treating hospital.
Response: We appreciate the commenter's suggestion. However, we do
not believe it is necessary to establish a specific transfer policy for
the SHFFT model. A SHFFT episode would only be initiated in the
hospital where the beneficiary had SHFFT surgery and where a SHFFT
model MS-DRG is first assigned to the beneficiary's hospitalization.
The initial treating hospital would only assign a SHFFT model MS-DRG to
the beneficiary if the beneficiary received SHFFT surgery at that
hospital and the transfer hospital could not assign a SHFFT model MS-
DRG unless the beneficiary had surgery on the other hip, an unlikely
scenario. Therefore, under the circumstances described by the
commenter, without any special policies beyond the standard rules of
SHFFT episode initiation, the SHFFT episode would be initiated at the
transfer hospital, which would be responsible for the SHFFT episode. We
note that if the SHFFT surgery was performed at the initial treating
hospital where an episode was initiated and then the beneficiary was
transferred to another hospital for additional care, the SHFFT episode
would continue under the responsibility of the initial treating
hospital. We note that we would apply the SHFFT model exclusion list to
the transfer hospital MS-DRG to determine whether those inpatient
services were included in the SHFFT episode.
Final Decision: After consideration of the public comments
received, we are not finalizing our proposal to attribute AMI episodes
to the initial treating hospital when an inpatient-to-inpatient
transfer occurs during the anchor hospitalization. Instead, we are
adopting a final policy to cancel the AMI episode initiated at the
initial treating hospital when an inpatient-to-inpatient transfer
occurs, and base any AMI or CABG episode initiation on the MS-DRG for
the final i-i transfer hospital admission if the i-i transfer hospital
is an AMI or CABG model participant. If the i-i transfer hospital is
not an AMI or CABG model participant, the beneficiary's care is not
included in any AMI or CABG episode. We are not using the terms chained
anchor hospitalization and price MS-DRG in the final episode definition
and pricing policies for the AMI model as discussed in sections
III.C.4.a.(5) and III.D.4.b.(2)(a) of this final rule. Instead, the
episode definition and pricing is determined only by the anchor MS-DRG
for the AMI or CABG model episode.
The proposal for AMI episode attribution in circumstances that
involve inpatient-to-inpatient transfers of beneficiaries with AMI was
included in proposed Sec. 512.240(a)(2). We no longer need a specific
attribution provision for the AMI model because attribution of AMI and
CABG episodes occurs in the usual manner to the AMI or CABG model
participant that discharges the beneficiary under an AMI MS-DRG, PCI
MS-DRG with AMI ICD-CM diagnosis code, or CABG MS-DRGs that initiates
the AMI or CABG episode at that hospital. Therefore, we are renumbering
proposed Sec. 512.240(a)(3) (Cancellation of an AMI model episode) to
Sec. 512.240(a)(2), and revising proposed Sec. 512.240(a)(3)(iii)
which has been renumbered Sec. 512.240(a)(2)(iii) to specify that an
AMI model episode is canceled if the beneficiary is transferred during
the anchor hospitalization to another hospital for inpatient
hospitalization.
The final policies for initiation and attribution of AMI and CABG
episodes that involve no transfer, outpatient-to-inpatient transfer, or
inpatient-to-inpatient transfers at the beginning of AMI care are
summarized in Table 8.
[[Page 282]]
Table 8--Final Initiation and Attribution of AMI and CABG Episodes That
Involve No Transfer, or Outpatient-to-Inpatient or Inpatient-to-
Inpatient Transfers at the Beginning of AMI Care
------------------------------------------------------------------------
Final episode initiation and
Scenario attribution policy
------------------------------------------------------------------------
No transfer (participant): Beneficiary Initiate AMI or CABG episode
admitted to an initial treating based on anchor
hospital that is a participant in the hospitalization MS-DRG.
AMI or CABG model for an AMI MS-DRG, Attribute episode to the
PCI MS-DRG with AMI ICD-CM diagnosis initial treating hospital.
code, or CABG MS-DRG.
No transfer (nonparticipant): No AMI or CABG episode is
Beneficiary admitted to an initial initiated.
treating hospital that is not a
participant in the AMI or CABG model
for an AMI MS-DRG, PCI MS-DRG with AMI
ICD-CM diagnosis code, or CABG MS-DRG.
Inpatient-to-inpatient transfer Initiate AMI or CABG episode
(nonparticipant to participant): based on the MS-DRG at i-i
Beneficiary admitted to an initial transfer hospital.
treating hospital that is not an AMI Attribute episode to the i-i
or CABG model participant and later transfer hospital.
transferred to an i-i transfer
hospital that is an AMI or CABG model
participant for an AMI MS-DRG, PCI MS-
DRG with AMI ICD-CM diagnosis code, or
CABG MS-DRG.
Inpatient-to-inpatient transfer Cancel AMI episode. No other
(participant to nonparticipant): AMI or CABG episode is
Beneficiary admitted to an initial initiated.
treating hospital that is an AMI or
CABG model participant for an AMI MS-
DRG or PCI MS-DRG with AMI ICD-CM
diagnosis code and later transferred
to an i-i transfer hospital for an
AMI, PCI, or CABG MS-DRG, where the i-
i transfer hospital is not an AMI or
CABG model participant.
Inpatient-to-inpatient transfer Cancel AMI episode at the
(participant to participant): initial treating hospital.
Beneficiary admitted to an initial Initiate an AMI or CABG
treating hospital that is an AMI or episode at the i-i transfer
CABG model participant for an AMI MS- hospital. Attribute episode to
DRG or PCI MS-DRG with AMI ICD-CM the i-i transfer hospital.
diagnosis code later transferred to an
i-i transfer hospital for an AMI, PCI,
or CABG MS-DRG, where the i-i transfer
hospital is an AMI or CABG model
participant.
Outpatient-to-inpatient transfer Initiate AMI or CABG episode
(nonparticipant to participant or based on anchor
participant to participant): hospitalization MS-DRG at o-i
Beneficiary transferred without transfer hospital. Attribute
admission from the initial treating episode to the o-i transfer
hospital, regardless of whether the hospital.
initial treating hospital is an AMI or
CABG model participant, to a o-i
transfer hospital that is an AMI or
CABG model participant and is
discharged from the o-i transfer
hospital for an AMI MS-DRG, PCI MS-DRG
with AMI ICD-CM diagnosis code, or
CABG MS-DRG.
Outpatient-to-inpatient transfer No AMI or CABG episode is
(participant to nonparticipant): initiated.
Beneficiary transferred without
admission from the initial treating
hospital that is an AMI or CABG
participant to an o-i transfer
hospital that is not an AMI or CABG
model participant.
------------------------------------------------------------------------
b. Middle of EPM Episodes
Similar to the CJR model, we proposed that once an EPM episode
begins, it would continue until the end of the episode as described in
the following section, unless certain circumstances arise during the
episode (80 FR 73318). When an EPM episode was canceled, we proposed
that the services furnished to beneficiaries prior to and following the
EPM episode cancellation would continue to be paid by Medicare as usual
but there would be no actual EPM episode spending calculation that
would be reconciled against the EPM quality-adjusted target price.
Specifically, we proposed that the following circumstances
occurring during an EPM episode would cancel the EPM episode:
The beneficiary ceases to meet any of the general
beneficiary inclusion criteria described in section III.C.4.a.(1) of
the proposed rule (81 FR 50834), except the three criteria regarding
inclusion in other episode payment model episodes.
The beneficiary dies during the anchor hospitalization.
The beneficiary initiates any BPCI model episode.
For purposes of cancellation of EPM episodes for beneficiary
overlap with other episode payment models, we proposed that if a
beneficiary in an EPM episode would initiate any BPCI model episode,
the EPM episode would be canceled. We refer to section III.D.6.c.(1) of
the proposed rule (81 FR 50868) for further discussion of our proposals
addressing potential overlap of beneficiaries in the EPMs with the BPCI
initiative. We also refer to section III.D.6.c.(3) of the proposed rule
(81 FR 50869 through 50871) for discussion of our proposal to cancel
EPM episodes for beneficiaries who become assigned to specified ACOs
during EPM episodes.
Our proposal to only cancel the EPM episode if a beneficiary dies
during the anchor hospitalization differs from the final CJR model
policy that cancels an episode if a beneficiary dies any time during
the episode (80 FR 73318). As discussed in the CJR Final Rule for LEJR
episodes, we believe that it also would be appropriate to cancel an
episode in the AMI, CABG, and SHFFT models when a beneficiary dies
during the anchor hospitalization as there would be limited incentives
for efficiency that could be expected during the anchor hospitalization
itself (80 FR 73318). We agreed with commenters on the CJR model
proposed rule that we should cancel CJR episodes for death any time
during those episodes, because beneficiary deaths following LEJR would
be uncommon and expected to vary unpredictably, leading to extremely
high or low episode spending that was not typical for a LEJR episode. A
recent analysis that pooled results from 32 studies showed the
incidence of mortality during the first 30 and 90 days following hip
replacement to be 0.30 percent and 0.65 percent, respectively,
confirming our expectation of low mortality rates during LEJR
episodes.\72\
[[Page 283]]
In contrast, the 30-day national CABG and AMI mortality rates as
displayed on Hospital Compare are significantly higher at approximately
3 percent and 14 percent respectively.\73\ Several CMS programs use 30-
day mortality measures for CABG and AMI as measures of hospital
quality, and these measures were proposed for use in the pay-for-
performance methodology for the CABG and AMI models as discussed in
section III.E.3.f. of the proposed rule (81 FR 50880). Similarly, a
2009 study shows a 30-day hip fracture mortality rate for Medicare
beneficiaries of approximately 5 percent, significantly higher than the
mortality rate following LEJR procedures.\74\ Thus, we would expect
that deaths during SHFFT episodes would be more common than in CJR
episodes. Because beneficiaries in AMI, CABG, and SHFFT episodes would
be at significant risk of death during these episodes that we proposed
to extend 90 days post-hospital discharge, we considered mortality to
be a harmful beneficiary outcome that should be targeted for
improvement through care redesign incentivized by the EPMs for these
clinical conditions. Therefore, in the proposed rule (81 FR 50841) we
discussed our belief that it would not be appropriate to exclude
beneficiaries from AMI, CABG, or SHFFT episodes who die any time during
the episode like we do in the CJR model. Instead, we proposed to
maintain beneficiary episodes in the EPMs even if death occurred during
the episodes, meaning we would calculate actual EPM episode spending
when beneficiaries die following discharge from the anchor
hospitalization but within the 90-day post-hospital discharge episode
duration and reconcile it against the quality-adjusted target price. We
believed this proposal would encourage EPM participants to actively
manage EPM beneficiaries to reduce their risk of death, especially as
death would often be preceded by expensive care for emergencies and
complications. Because of the higher mortality rates for all of the EPM
episodes than for LEJR episodes in the CJR model, we did not consider
mortality following hospital discharge to be atypical and, therefore,
we proposed to cancel EPM episodes only for death during the anchor
hospitalization.
---------------------------------------------------------------------------
\72\ Berstock JR, Beswick AD, Lenguerrand E, Whitehouse MR, Blom
AW. Mortality after total hip replacement surgery: A systematic
review. Bone & Joint Research. 2014; 3(6):175-182. doi:10.1302/2046-
3758.36.2000239.
\73\ https://www.medicare.gov/hospitalcompare/search.html.
\74\ Brauer CA, Coca-Perraillon M, Cutler DM, Rosen AB.
Incidence and Mortality of Hip Fractures in the United States. JAMA.
2009;302(14):1573-1579. doi:10.1001/jama.2009.1462.
---------------------------------------------------------------------------
We further proposed that the following circumstances also would
cancel an AMI episode in the circumstances of a chained anchor
hospitalization when the beneficiary was discharged from acute care
under an MS-DRG from the final transfer hospital in the chained anchor
hospitalization that could not, itself, initiate an AMI or CABG
episode, regardless of whether the final transfer hospital was an AMI
or CABG model participant (that is, the episode would be canceled if
the final transfer hospital MS-DRG was any MS-DRG other than an AMI MS-
DRG, PCI MS-DRG, or CABG MS-DRG).
While we proposed to begin an AMI episode with the first
hospitalization in the chained anchor hospitalization that would
initiate an episode as discussed in section III.C.4.a.(5) of the
proposed rule (81 FR 50836 through 50840), we also proposed to cancel
AMI episodes under the circumstances when a beneficiary in an AMI
episode was discharged from acute care under an MS-DRG from the final
i-i transfer hospital in the chained anchor hospitalization that was
not an AMI, PCI, or CABG MS-DRG that could initiate an AMI or CABG
episode (that is, the episode would be canceled if the final transfer
hospitalization MS-DRG was any MS-DRG other than an AMI, PCI, or CABG
MS-DRG). Overall, this proposal treated the hospital that initiated the
AMI episode and then transferred the beneficiary most similarly to a
hospital that furnished all of the beneficiary's inpatient care itself,
with respect to whether or not the beneficiary's care was ultimately
included as an episode in the AMI model.
Finally, we did not propose to cancel an AMI episode altogether for
a CABG readmission during the 90-day post-hospital discharge period or
cancel the AMI episode and initiate a CABG episode because planned CABG
readmission following an anchor hospitalization that initiates an AMI
episode may be an appropriate clinical pathway for certain
beneficiaries. Instead, we proposed to provide an adjusted AMI model-
episode benchmark price that includes a CABG readmission in such
circumstances so as not to financially penalize participant hospitals
for relatively uncommon, costly, clinically appropriate care patterns
for beneficiaries in AMI episodes. We refer to section III.D.4.b.(2)(c)
of the proposed rule (81 FR 508520 for discussion of the adjusted AMI
model-episode benchmark price that would apply in the case of CABG
readmission during an AMI episode.
The proposals for cancellation of EPM episodes were included in
proposed Sec. Sec. 512.240(a)(3), (b)(2), and (c)(2). We sought
comment on our proposals for cancellation of EPM episodes.
The following is a summary of the comments received and our
responses.
Comment: With the exception of the proposal for cancellation of EPM
episodes for death only during the anchor hospitalization, many
commenters expressed support for the other proposed EPM episode
cancellation policies, especially the proposal to cancel EPM episodes
in the circumstances of a chained anchor hospitalization when the
beneficiary is discharged from acute care under an MS-DRG from the
final transfer hospital in the chained anchor hospitalization that
could not, itself, initiate an AMI or CABG episode. The commenters
pointed out that when a transfer results in discharge from the final
hospital in the chained anchor hospitalization under an MS-DRG that
could not initiate an AMI or CABG episode, those episodes are
disproportionately likely to reflect high-cost episodes that would not
be conducive to care redesign due to beneficiary complexity and the
need for atypical beneficiary care. Several commenters encouraged CMS
to monitor cancellation circumstances because EPM participants could
engage in gaming by discharging a dying patient from the hospital to
garner a low-cost episode or encouraging beneficiaries to enroll in a
Medicare Advantage plan.
A few commenters requested that CMS cancel EPM episodes when a
beneficiary has an excluded readmission because the Part A and Part B
services furnished following that readmission would be related to the
clinical condition that was the basis for the readmission, and not the
condition that was the focus of the EPM.
Response: We appreciate the support for our proposals to cancel an
EPM episode when a beneficiary initiates an EPM episode but then fails
to meet the general beneficiary care inclusion criteria sometime during
the episode, which include enrollment in Medicare Part A and Part B;
eligibility for Medicare not on the basis of end-stage renal disease;
not enrolled in any managed care plan; not covered under a United Mine
Workers of American health plan; have Medicare as their primary payer;
and not to an ACO in the Next Generation ACO model or an ACO in a track
of the Comprehensive ESRD Care Model incorporating downside risk for
financial losses. In addition, we appreciate the support for our
proposals to cancel an AMI episode when a beneficiary initiates any
BPCI episode and when an AMI model beneficiary is discharged from the
final hospital in a
[[Page 284]]
chained anchor hospitalization under an MS-DRG that is not an AMI, PCI,
or CABG MS-DRG, regardless of whether the final transfer hospital is an
AMI or CABG model participant. As discussed in section III.C.4.a.(5) of
this final rule, we are finalizing this proposal, but with modification
to cancel all AMI episodes that begin at an initial treating hospital
when an inpatient-to-inpatient transfer occurs after the AMI episode
has begun.
In response to those commenters requesting that we cancel EPM
episodes for the occurrence of an excluded readmission, we do not agree
that all Part A and Part B services furnished following discharge from
the excluded readmission but within the original 90-day post-discharge
period for the EPM episode would be unrelated to the clinical condition
that is the focus of the EPM. Instead, we believe care during that
period would also be furnished for EPM beneficiary management and
recovery following the AMI, CABG, or SHFFT hospitalization that
initiated the EPM episode. The application of our exclusion list for
readmissions and Part B services continues to identify those
readmissions and Part B services that would be excluded from the EPM
episode definition throughout the full post-discharge episode duration,
regardless of the occurrence of an excluded readmission during the EPM
episode.
Additionally, as discussed in sections III.G.4. through 6. of this
final rule, we plan to monitor EPM participants' claims data and audit
EPM participants' and their EPM collaborators medical records and
claims as we deem appropriate and will include canceled EPM episodes in
this monitoring to ensure that we do not observe patterns of
cancellation suggestive of gaming of the EPM episode cancellation
policies.
Comment: Several commenters expressed support for CMS' proposal to
cancel EPM episodes for death during the anchor hospitalization but not
for death during the 90-day post-discharge episode period. These
commenters agreed that death during the inpatient hospitalization would
be atypical and should result in EPM episode cancellation, whereas
death within the 90 days following hospital discharge would not be rare
for the clinical conditions in the EPMs and could appropriately be
targeted for improvement through EPM care redesign. The commenters
pointed out that CMS' proposals to use AMI and CABG mortality rates in
the AMI and CABG model pay-for-performance methodologies was consistent
with the opportunities for EPM care redesign to reduce mortality rates
in the 30 days following discharge from the anchor hospitalization for
AMI and CABG. A few commenters suggested that CMS should not cancel EPM
episodes for any death once they are initiated, even for death during
the anchor hospitalization, arguing that such cancellations could skew
episode costs and that some in-hospital deaths may be preventable,
which the EPMs should provide incentives to prevent.
However, many commenters, including MedPAC, recommended that CMS
adopt the same policy as the CJR model and cancel episodes for death at
any time during the EPM episode, including during the 90 days post-
hospital discharge. Some of the commenters stated that episodes during
which a beneficiary dies usually involve atypical courses of care,
which may include extensive end-of-life care that hospitals should not
be penalized for providing. MedPAC speculated that on the one hand,
stays during which the EPM beneficiary dies could be exceptionally
high-cost if the patient lives for most of the 90 days and receives
end-of-life care. On the other hand, if the EPM beneficiary dies
shortly after discharge from the hospital, the patient may receive
little post-acute care services or end-of-life care, resulting in
unusually low-cost episodes. They concluded that in either case, the
episode spending would not be typical and, therefore, these stays
should be excluded from calculating the target price and reconciliation
payment for the EPM participant. They stated that excluding these
episodes would make the spending data less ``noisy'' and better reflect
the typical spending for the EPM participant's episodes. MedPAC also
claimed that CMS has better tools than including in the EPMs
beneficiaries who die in the 90 days following hospital discharge that
encourage lower mortality rates, such as use of the AMI and CABG
mortality rates in the HVBP Program, and care coordination, such as the
Medicare Spending Per Beneficiary (MSPB) measure in the HVBP Program
and the HRRP.
Some commenters further contended that the proposal to cancel SHFFT
episodes only for death during the anchor hospitalization compared to
CJR model episode cancellation for beneficiary death any time during a
LEJR episode leads to a lack of consistency between hip fracture
beneficiaries included in the CJR and SHFFT models. Under CMS'
proposal, hip fracture beneficiaries treated with a SHFFT would be
subject to one set of rules, while those treated with a hip replacement
would be subject to another set, leading to confusion among the
hospitals that would be participants in both the CJR and SHFFT models
and inequitable treatment of beneficiaries with the same clinical
condition of hip fracture. The commenters also believe that CMS'
rationale for not canceling SHFFT episodes for beneficiaries who die
following discharge from the anchor hospitalization due to a higher
risk of death for hip fracture patients than patients receiving LEJR
ignored the fact that a substantial portion of the hip fracture
population is treated with a LEJR. These commenters concluded that this
overlap of fracture beneficiaries between SHFFT and LEJR confounded the
comparison CMS was trying to make between the higher mortality rate of
beneficiaries following SHFFT versus LEJR and led to questions about
its validity.
Response: While we appreciate that there may be some opportunities
to reduce in-hospital deaths for beneficiaries treated with CABG or
SHFFT, we believe that there are limited efficiencies that could be
expected during the anchor hospitalization itself. Furthermore, we note
that there are three separate MS-DRGs for beneficiaries who die during
a hospitalization for AMI (MS-DRG 283 Acute Myocardial Infarction,
Expired with MCC; MS-DRG 284 Acute Myocardial Infarction, Expired with
CC; MS-DRG 285 Acute Myocardial Infarction, Expired without CC/MCC),
and we did not propose that these MS-DRGs would initiate AMI episodes.
Thus, there would be no situations when AMI episodes were canceled for
death during an anchor hospitalization. Thus, we do not believe it
would be appropriate to include beneficiaries who die during the anchor
hospitalization in any of the EPMs.
While beneficiary deaths in the 90-days post-discharge from the
anchor hospitalization would be expected to be more common in AMI,
CABG, and SHFFT episodes than in the LEJR episodes included in the CJR
model, we agree with the commenters that the costs of such episodes are
likely to vary unpredictably across EPM participants. We also agree
with the commenters' argument about the importance of policy
consistency in similar episode payment models for deaths because
adopting different cancellation policies for death under the CJR model
than we proposed for the EPMs could be confusing for those hospitals
that are participants in both the SHFFT and CJR models. While we
continue to believe that reductions in mortality following discharge
from a hospitalization for AMI, CABG, or SHFFT are a harmful
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beneficiary outcome that should be targeted for improvement through
care redesign incentivized by the EPMs for these clinical conditions,
we agree with the commenters that it would be appropriate to cancel all
EPM episodes for beneficiary death any time during the episode. We note
that our use of 30-day AMI and CABG mortality measures in the pay-for-
performance methodologies of the AMI and CABG models, respectively, as
discussed in sections III.E.2.b. and c. of this final rule encourages
AMI and CABG model participant to actively manage AMI and CABG
beneficiaries to reduce this risk of death, to supplement existing
incentives in other CMS programs that encourage lower mortality rates.
Comment: Several commenters requested that CMS clarify its
administrative policies for identifying and informing EPM participants
about beneficiaries whose episodes are initiated and then canceled. The
commenters stated that CMS should inform EPM participants in a timely
manner when an episode is canceled for any reason, with one commenter
specifying at least quarterly notification. The commenters pointed out
that an EPM participant's awareness of episode cancellation is
important for several reasons, including the EPM participant's
simultaneous calculation of EPM episode spending; beneficiary
notification; provision of beneficiary engagement incentives; and
determination of beneficiary eligibility for certain Medicare program
rule waivers which is discussed further in section III.J. of this final
rule. The commenters claimed that while the EPM participant is in the
best position to know when the triggering procedures or services they
have been providing will result in a MS-DRG that would initiate an EPM
episode, the EPM participant will not always know when a patient meets
certain exclusion criteria throughout the course of the EPM episode.
The commenters emphasized that it is important for the EPM participant
to know if beneficiaries they expect to be part of the EPM episode are
going to be part of the EPM episode on a timely basis for cancellations
or events that would serve to disqualify the beneficiary from a given
hospital's attribution of an episode. Therefore, the commenters
recommended that CMS inform EPM participant and CJR participant
hospitals timely when an episode is canceled for any reason.
Response: We appreciate the interest of the commenters in
conducting timely analysis of EPM episode spending, as well as ensuring
that the requirements of the EPM are met in their treatment of Medicare
beneficiaries. Given our plans for providing and updating episode
claims data to EPM participants upon request as frequently as quarterly
as discussed in section III.K.5 of this final rule, we will explore
adding indicators to the beneficiary-identifiable claims data supplied
to EPM participants that provide information about circumstances that
could result in EPM episode cancellation, such as admission of a
beneficiary to a hospital that initiates episodes under a BPCI model
for care that could potentially cancel an EPM episode. To the extent
adding such indicators to the claims data is feasible, providing this
information through the claims data to EPM participants would ensure
that EPM participants are informed as frequently as quarterly about
beneficiary circumstances that could result in EPM episode
cancellation. This information would not be real-time, however, and
while our best estimate, would likely be incomplete even based on the
best available information at the time. At a minimum, it would always
reflect the time lag for the EPM episode claims to be submitted and
processed and then reported back to the EPM participant in the updated
claims data. We note that at reconciliation, complete information would
be provided to EPM participants that have requested beneficiary-level
claims data or summary beneficiary claims data reports about those
episodes that were ultimately included in the EPM participant's
reconciliation report as discussed in section III.D.5. of this final
rule.
We note that we expect EPM participants to be actively managing all
of their beneficiaries with conditions characterized by AMI, CABG, or
SHFFT based on their care pathways developed for such beneficiaries,
regardless of the model or program that may ultimately apply to the
beneficiary under the uncommon circumstances of EPM episode
cancellation. We also emphasize the importance of strong, ongoing
communication among providers in a given geographic area caring for
beneficiaries in similar models or programs where provider interests in
delivering high quality, efficient health care should align.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. Sec. 512.240(a)(2),
(b)(2), and (c)(2) for cancellation of EPM episodes, with modification
to also cancel EPM episodes if the beneficiary dies during the episode.
We are canceling EPM episodes for the following circumstances:
The beneficiary ceases to meet any of the general
beneficiary inclusion criteria described in section III.C.4.a.(1) of
this final rule, except the three criteria regarding inclusion in other
episode payment model episodes.
The beneficiary dies.
The beneficiary initiates any BPCI model episode.
Additionally, in the AMI model we are canceling the AMI episode
when a beneficiary is transferred during the anchor hospitalization for
inpatient hospitalization at another hospital as discussed in section
III.C.4.a.(5) of this final rule.
Because we are not finalizing the proposed AMI model transfer
episode initiation and attribution policy, as discussed in section
III.C.4.a.(5) of this final rule, we are not adopting the policy
included in proposed Sec. 512.240(a)(2). Therefore, we are renumbering
proposed Sec. 512.240(a)(3) to Sec. 512.240(a)(2) to specify the
final AMI episode cancellation policy. This includes renumbering
proposed Sec. 512.240(a)(3)(iii) to final Sec. 512.240(a)(2)(iii) and
revising the provision to specify the final inpatient-to-inpatient
transfer policy that cancels an AMI model episode if the beneficiary is
transferred during the anchor hospitalization for inpatient
hospitalization at another hospital.
c. End of EPM Episodes
(1) AMI and CABG Models
We proposed a 90-day post-hospital discharge episode duration for
AMI episodes. AMI in general, whether managed medically or with
revascularization, has a lengthy recovery period, during which the
beneficiary has a higher than average risk of additional cardiac events
and other complications, as well as higher utilization of diagnostic
testing and related cardiac procedures. AMI frequently serves as a
sentinel event that marks the need for a heightened focus on medical
management of coronary artery disease and other beneficiary risk
factors for future cardiac events, cardiac rehabilitation over multiple
months, and beneficiary education and engagement. Given the broad
episode definition for AMI episodes that includes beneficiaries
receiving both medical and PCI management for an acute event, we do not
believe that an episode longer than 90 days would be feasible due to
the higher risk of including unrelated services in the episode beyond
several months after hospital discharge. However, we believe that 90-
day post-hospital discharge episodes would provide substantial
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incentives for aggressive medical management, cardiac rehabilitation,
and beneficiary education and engagement, whereas a shorter episode
duration would have less effect. We acknowledge that ongoing disease
management for beneficiaries with cardiovascular disease must extend
long after the conclusion of the AMI episodes. However, we believe the
90-day post-hospital discharge episode duration remains appropriate for
an episode payment model focused around a hospitalization. We expect
that the medical management and care coordination during AMI episodes
would continue to be provided as beneficiaries transition out of AMI
episodes, potentially into a primary care medical home or other model
or program with accountability for population health, such as an ACO.
We further note based on analysis of historical episodes that about
10 percent of beneficiaries hospitalized with AMI who received a CABG
received the CABG between 2 and 90 days post-discharge from the anchor
hospitalization (these beneficiaries would be in AMI episodes), while
the remaining 90 percent of CABGs for beneficiaries hospitalized with
AMI were provided during the initial hospitalization (these
beneficiaries would in CABG episodes). In contrast, fewer than 3
percent of those AMI model beneficiaries who received an inpatient or
outpatient PCI during an AMI episode received the PCI between 2 and 90
days post-discharge from the anchor hospitalization, while more than 97
percent received the PCI during the anchor hospitalization.\75\ We
refer to section III.D.4.b.(2)(c) of this final rule for further
discussion of pricing adjustments and alternatives considered for
setting EPM-episode benchmark prices for AMI episodes where PCI or CABG
occurs during the AMI episode but post-discharge from the anchor or
chained anchor hospitalization.
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\75\ Episodes for AMI beneficiaries initiated by all U.S. IPPS
hospitals and constructed using standardized Medicare FFS Parts A
and B claims, as proposed in the proposed rule, that end in CY 2014.
---------------------------------------------------------------------------
Finally, for similar reasons, we believe CABG episodes should
extend 90 days post-hospital discharge. About one-third of CABG
procedures are performed in the context of a hospital admission for
AMI, leading to the same considerations discussed previously in this
section around the appropriate episode duration for beneficiaries with
AMI. The remaining CABG model beneficiaries are likely to have
significant ischemic heart disease, making the occurrence of CABG
itself a sentinel event, like AMI, that marks the need for a heightened
focus on medical management of CAD and other beneficiary risk factors
for future cardiac events, cardiac rehabilitation over multiple months,
and beneficiary education and engagement. Moreover, CABG procedures
have 90-day global periods under the Physician Fee Schedule, consistent
with the lengthy period of recovery associated with major chest
surgery. Thus, a 90-day post-hospital discharge episode duration is
consistent with the recovery period from CABG surgery. We acknowledge
that ongoing disease management for beneficiaries with cardiovascular
disease must extend long after the conclusion of the CABG episodes.
However, we believe the 90-day post-hospital discharge episode duration
remains appropriate for an episode payment model focused around a
hospitalization. We expect that the medical management and care
coordination during CABG episodes would continue to be provided as
beneficiaries transition out of CABG episodes, potentially into a
primary care medical home or other model or program with accountability
for population health, such as an ACO.
As in the CJR model, we proposed that the day of discharge from the
anchor hospitalization counts as day 1 of the post-hospital discharge
period (80 FR 73324). Since the post-hospital discharge period is
intended to extend 90 days for recovery following hospital discharge,
we believe it is appropriate under these circumstances to begin the 90-
day count when the beneficiary is ultimately discharged from acute care
for the first time during the AMI episode. However, the hospital that
initiated the AMI episode in the chained anchor hospitalization would
continue to be responsible in the AMI model for the episode discussed
previously in section III.C.4.a.(5) of this final rule.
The proposals for the end of AMI and CABG episodes were included in
proposed Sec. Sec. 512.240(a)(1) and (b)(1), respectively. We sought
comment on our proposals to end AMI and CABG episodes.
We received a number of comments on the proposed episode duration
for the AMI and CABG models, although most commenters provide similar
rationale and recommendations for the three proposed EPMs. Thus, we
refer to the next section for a discussion of the comments regarding
the proposed ending of EPM episodes, including SHFFT as well as AMI and
CABG episodes.
(2) SHFFT Model
We believe that SHFFT model beneficiaries are similar to CJR model
beneficiaries who undergo hip replacement for fracture. We believe that
the same episode duration as the CJR model of 90 days is appropriate
for SHFFT episodes in order to include the full time for recovery of
function for these beneficiaries, which extends beyond 60 days based on
patterns of post-acute care provider use (80 FR 73319 through 73324).
Therefore, we proposed a 90-day post-hospital discharge duration for
SHFFT episodes.
The proposal for the end of SHFFT episodes was included in proposed
Sec. 512.240(c)(1). We sought comment on our proposal to end SHFFT
episodes.
The following is a summary of the comments received and our
responses.
Comment: A number of commenters expressed support for the proposed
90-day post-discharge episode duration for the AMI, CABG, and SHFFT
models. These commenters reasoned that 90 days following discharge from
an inpatient hospitalization was the most clinically appropriate length
for the proposed conditions and would enhance the commitment of EPM
participants and their collaborators to caring for patients over time.
They added that this duration would be sufficiently long to capture
many complications of treating EPM clinical conditions and engage
multiple providers in inpatient, outpatient, and post-acute care
provider settings. The commenters believe that the proposed episode
length would move providers closer to achieving long-term population
health management. Several commenters pointed out that hospitals are
well-prepared to assume responsibility for EPM episodes that continue
for 90 days after hospital discharge.
Other commenters stated that the proposed 90-day EPM episode
duration was too long, especially in the context of the proposals to
include a broad array of related items services in EPM episodes. In
general, the commenters who stated for a shorter episode duration
believe that during the early stages of required bundled payment
models, it would be more reasonable for hospitals to assume episode
performance risk for 30 days post-discharge than 90 days as proposed
and that CMS should adopt 30-days post-discharge as the standard EPM
episode duration permanently or temporarily, such as for the first two
model years, and then reevaluate.
Several commenters contended that in using an episode definition
that
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includes 90-day post-discharge, CMS was, in effect, making hospitals
managers of population health. These commenters believe that hospitals
lack the resources, skill sets, and infrastructure to engage in the
mission of managing population health, and stated that the requirements
are much different and more complex and demanding than what is need for
episode payments. Several commenters reasoned that since the proposed
quality metrics for the EPMs were 30 days after discharge and they
believe that hospitals are more effective managing the first 30 days of
an episode, the episode duration should be shortened to 30 days so the
quality and performance metrics would be aligned.
A number of commenters requested that CMS shorten the episode
duration to 30 days because 30 days is a more appropriate duration for
exacerbations of existing, unrelated chronic conditions to the
condition that is the focus of the episode. Some commenters claimed
that a post-surgical or post-event episode duration under the AMI,
CABG, and SHFFT models longer than 30 days poses a greater risk for
variability due to medical events outside the intended scope of the
model and control of the hospital. They stated that this is
particularly true for ill patients who are likely to have major
complications or comorbidities when admitted and are at higher risk for
developing new complications post-discharge. The commenters stated that
because all the proposed models are urgent or emergent, rather than
elective or time-sensitive, this danger poses greater concern than
under other Innovation Center episode payment models, such as the CJR
model and OCM. While such comorbidities contributing to all-cause
readmission can be reasonably controlled in the immediate and 30-day
post-operative or post-event period, the commenters contended that the
most complex patients develop complications after discharge, which are
highly varied and predominantly unrelated to the quality of care they
receive. Therefore, they concluded that care for chronic conditions and
other non-anchor MS-DRG-related conditions becomes much more prevalent
in days 31 to 90 following hospital discharge. One commenter observed
based on experience in its hospitals that after 30 days, an over 30
percent increase in readmissions to a hospital other than the original
facility occurred, creating a need for additional strategies to
coordinate episode care after 30 days. The commenters stated that
hospitals do not have the time, money, skill set or recourse to develop
the infrastructure to support episode care management during the 31- to
90-day post-discharge period. Finally, several commenters observed that
Medicare beneficiaries may have more than one residence during the
year, creating challenges with follow up for an episode that extends 90
day following hospital discharge.
Response: We appreciate the support of many commenters for the
proposed 90-day post-hospital discharge EPM episode duration. We agree
with the commenters that the episode duration should capture the
majority of health care services that are related to the episode and be
sufficiently long to include many complications and follow-up care to
the anchor hospitalization. We believe that hospitalization is often a
sentinel event for Medicare beneficiaries, representing an opportunity
for increased care coordination and, in the case of the EPMs, improved
care management of chronic conditions that may have led to the
hospitalization for the cardiac event or cardiac or orthopedic surgery.
This episode duration provides EPM participants with a substantial
period of time in which to work to improve the quality and efficiency
of EPM episode performance for beneficiaries who are hospitalized for
the targeted conditions.
We have substantial BPCI Model 2 experience in testing AMI, PCI,
CABG, and SHFFT episodes that include beneficiaries who are most
similar to those who would be included in the proposed EPMs. Almost all
BPCI Model 2 Awardees testing these episodes have selected the 90-day
episode duration, compared to the 30-day and 60-day alternative
durations that are available in BPCI Model 2. Ninety days post-hospital
discharge is also the episode duration in the CJR model. Our goal in
the EPMs is to incentivize efficient, high quality care that returns
beneficiaries to the community in the best health possible, and we
believe that a 90-day post-discharge duration reflects a full continuum
of clinical services and transition of care for average SHFFT, AMI, and
CABG model beneficiaries, at which time the beneficiary's functional
recovery and stabilization of medical conditions are relatively
complete so the beneficiary is able to resume most usual activities of
daily living.
Similar to LEJR episodes under the CJR model, in our analysis of
episode spending for the EPMs we observed the concentration of Medicare
post-discharge episode spending in the earlier part of the episode
following discharge from the anchor hospitalization in all the
EPMs.\76\ Specifically, in the first 30 days following anchor
hospitalization discharge in AMI episodes, excluding those AMI episodes
with readmissions for CABG for which we make a payment adjustment under
the AMI model as discussed in section III.D.4.b.(2)(c) of this final
rule, we found 61 percent and 54 percent of post-discharge episode
spending for AMI MS-DRG-anchored and PCI MS-DRG-anchored AMI episodes,
respectively. Similarly, in the 30 days following discharge, we
observed 68 percent and 69 percent of post-discharge episode spending
for CABG and SHFFT episodes. For all of the EPMs, about 60 to 70
percent of the remaining post-discharge spending occurred in days 31-60
post-discharge, and one-third in days 61-90 post-discharge. Thus, while
the 90-day post-discharge episode duration increases the EPM
participant's financial risk somewhat compared to episodes that extend
only 30 days, because we found that significant services related to the
clinical condition that is the focus of the models occurred during days
31-90 post-discharge, we believe there are significant opportunities
for improved quality and efficiency in EPM episodes after 30 days and
extending through 90 days post-discharge from the anchor
hospitalization. If, as some commenters speculated, a post-surgical or
post-event episode duration under the AMI, CABG, and SHFFT models
longer than 30 days posed a significant risk of variability primarily
due to medical events that are unrelated to the clinical condition that
is the focus of the EPM episode, we would have expected to see an equal
percentage of post-discharge episode spending in the periods of time
from days 31-60 and 61-90. That was not the case in our analysis,
because we continued to see EPM episode spending as a proportion of
post-discharge spending drop off in relation to increasing time after
discharge, suggesting that the EPM episode definitions are capturing
related episode spending that declines, as would be expected, over the
period of time post-discharge as the beneficiary recovers and returns
to the community.
---------------------------------------------------------------------------
\76\ Episodes for AMI, CABG, and SHFFT beneficiaries initiated
by all U.S. IPPS hospitals not in Maryland and constructed using
standardized Medicare FFS Parts A and B claims, as proposed in the
proposed rule, that began in CY 2012-2014.
---------------------------------------------------------------------------
While we understand that uncommon events during the 90-day post-
discharge episode duration may occur for an individual beneficiary,
resulting in an unanticipated or unavoidable need for costly health
care services, we believe
[[Page 288]]
that our EPM episode definitions that exclude unrelated items and
services and our payment policies, namely the adjustment for high
payment episodes and stop-loss policies discussed in sections
III.D.3.d., III.D.7.b.(1), and III.D.7.d. of this final rule, provide
sufficient protections for EPM participants from undue financial
responsibility for the care of unrelated clinical conditions as well as
for unusual circumstances. We also believe that shorter episode
durations may incur a higher clinical risk for beneficiaries if EPM
participants delay services beyond the EPM episode, and the risk to
beneficiaries of this response by providers to episode payment can be
minimized by the longer 90-day episode duration that we proposed for
the EPMs. We refer to sections III.G.4. through 6. of this final rule
for discussion of our plans to monitor for access to care, quality of
care, and delayed care.
In response to the commenters recommending a shorter episode
duration in the earlier stages of bundled payment, as noted previously
we have several years of experience with BPCI Model 2 where the
majority of Awardee have selected a 90-day episode duration for
episodes of a similar design to the EPMs that target the same clinical
conditions. While entities choose to participate in the BPC models, we
have also established a 90-day episode duration in the CJR model, which
is the first episode payment model which has a geographic basis. Thus,
we do not believe that it is necessary to adopt a shorter episode
duration for the EPMs either permanently or temporarily.
Regarding those commenters who believe that the 90-day post
discharge episode duration and broad episode definitions would make
hospitals responsible for population health, we note that the EPMs are
not total cost-of-care models. As discussed in section III.C.3.b of
this final rule, we exclude items and services that are unrelated to
EPM episodes, namely those that are not directly related to the EPM
episode or the quality or safety of the EPM episode care that is
included in the EPM episode; for chronic conditions that are generally
not affected by the EPM episode care; and for acute clinical conditions
not arising from existing EPM episode-related chronic clinical
conditions or complications of EPM episode care. We agree with the
commenters in favor of the proposed 90-day post-discharge episode
duration for the EPMs who stated that the proposed EPMs of this episode
duration move providers closer to long-term population health
management. Given the diversity of commenters' views on hospitals'
readiness to assume responsibility for episodes of the proposed
duration, we appreciate that EPM participants in models where
participation is required are in various stages of readiness for
managing the quality and cost performance of episode, based on their
prior experience, resources, and infrastructure. We believe that all
EPM participants have substantial opportunities to increase their
capacity to manage the quality and cost of EPM episodes and achieve
significant financial rewards from good performance, regardless of
their starting point. We note that many of the EPM policies such as
data sharing, financial arrangements, the phase-in of two-sided risk,
and stop-loss limits afford hospitals the opportunity to learn about
EPM episode care patterns, collaborate with others who have expertise
in care redesign, and implement their initial EPM care plans for their
beneficiaries in an initial environment of limited financial risk.
We do not believe that the measurement period for the quality
measures and the duration of the EPM episodes must necessarily align,
although we note that we sought comment in the EPM proposed rule about
potentially using quality measures that examine patient outcomes over a
period that extends at least as long as the EPM episode (81 FR 50901).
We proposed to use existing AMI and CABG outcome measures that assess
outcomes over a 30-day period following discharge, at least initially,
because they are in wide use and have gained acceptance among hospitals
and because the AMI and CABG mortality measures have been reviewed and
endorsed by the National Quality Forum. However, we believe that 90
days is a period over which hospitals have substantial ability to
influence the quality and efficiency of care that EPM beneficiaries
receive. Rather than shorten EPM episodes to align with the existing
30-day quality measure timeframe as some commenters recommended, we
believe it would be more appropriate to seek to adapt the existing
measures or to develop new related measures to assess outcomes over a
longer timeframe, including timeframes at least as long as the EPMs. We
refer to section III.E.4 of this final rule for further discussion of
our plans regarding future quality measures that could be incorporated
into the EPM pay-for performance methodologies.
Finally, we appreciate the perspective of the commenters who
believe that a 30-day episode duration would be more appropriate
because a longer episode duration poses a greater risk for variability
due to events outside the intended scope of the model and control of
the hospital, including readmissions to a different hospital, and that
this risk is higher for the EPMs than other Innovation Center bundled
payment models due to the urgent or emergent clinical conditions
included in the EPMs. We agree with the commenters that the EPMs test
different clinical scenarios than the CJR model that targets LEJR,
which is primarily elective, and that the complexity of many EPM
beneficiaries requires new approaches to redesigning and coordinating
care for the 90 days post-hospital discharge. While EPM beneficiaries
may be more likely to develop a variety of complications requiring more
related services following discharge than those in the CJR model, we
continue to believe that complications most commonly have patterns and
bear a significant relationship to the quality of care and
effectiveness of care coordination following hospital discharge. Even
though some EPM beneficiaries may be medically complex and fragile, we
continue to believe there are substantial opportunities to improve the
quality and efficiency of their care under the EPMs where EPM
participants have quality and cost performance responsibility for
episodes that extend 90-day post-discharge from the anchor
hospitalization. We also agree with the commenters that EPM
participants who are required to participate in the EPMs be protected
from undue financial risk. We refer to section III.D.4.b.(2) of this
final rule for further discussion of risk adjustment under the EPMs.
Final Decision: After consideration of the public comments
received, we are finalizing the proposals in Sec. Sec. 512.240(a)(1),
(b)(1), and (c)(1) for the end of AMI, CABG, and SHFFT episodes,
respectively, based on an EPM episode duration that extends 90 days
following discharge from the anchor hospitalization, with modification
to revise Sec. 512.240(a)(1) to eliminate proposed paragraphs
(a)(1)(i) and (ii) and incorporate the 90-day post-discharge episode
duration in the general provision. We no longer need to specify the
episode duration separately for an AMI episode that includes an
inpatient-to-inpatient transfer after an AMI episode has been initiated
because we are not adopting the proposed policies for chained anchor
hospitalizations. As discussed in section III.C.4.a.(5). of this final
rule, we are not finalizing the AMI model transfer episode initiation
and attribution proposal that would have required us to
[[Page 289]]
identify chained anchor hospitalizations.
D. Methodology for Setting EPM Episode Prices and Paying EPM
Participants in the AMI, CABG, and SHFFT Models
1. Background
a. Overview
We proposed that the AMI, CABG, and SHFFT models would provide
incentives for EPM participants to work with other health care
providers and suppliers to improve the quality and efficiency of care
for Medicare beneficiaries by paying EPM participants or holding them
responsible for repaying Medicare based on EPM participants'
performance with respect to the quality and spending for AMI, CABG, and
SHFFT episodes in a manner similar to the CJR model. Given the general
similarity between the design of the CJR model and these EPMs, there is
precedent for adopting the general payment and pricing parameters used
under the CJR model, with modification to appropriately pay for EPM
episodes that include the different clinical conditions treated in AMI,
CABG, and SHFFT model episodes. The following sections describe our
proposals for the:
Performance year, retrospective episode payments, and two-
sided risk EPMs.
Adjustments to actual EPM-episode payments and to
historical episode payments used to set episode prices.
EPM episode price-setting methodologies.
Process for reconciliation.
Adjustments for overlaps with other Innovation Center
models and CMS programs.
Limits or adjustments to EPM participants' financial
responsibility.
b. Key Terms for EPM Episode Pricing and Payment
For purposes of ease of understanding of the technical discussion
that follows around EPM episode pricing and payment, our proposed rule
provided the following definitions of terms that were used in sections
that precede their technical definition and cross-references to other
sections of the proposed rule for more detailed discussion of the
policies associated with these terms.
Anchor hospitalization--hospitalization that initiates an
EPM episode and has no subsequent inpatient-to-inpatient transfer
chained anchor hospitalization.
Chained anchor hospitalization--an anchor hospitalization
that initiates an AMI model episode and has at least one subsequent
inpatient-to-inpatient transfer.
Anchor MS-DRG--MS-DRG assigned to the first
hospitalization discharge, which initiates an EPM episode.
Price MS-DRG--for EPM episodes without a chained anchor
hospitalization, the price MS-DRG is the anchor MS-DRG. For AMI model
episodes with a chained anchor hospitalization, the price MS-DRG is the
MS-DRG assigned to the AMI model episode according to the hierarchy
that was described in III.D.4.b.(2)(i) of the proposed rule.
Episode benchmark price--dollar amount assigned to EPM
episodes based on historical EPM-episode data (3 years of historical
Medicare payment data grouped into EPM episodes according to the EPM
episode definitions as discussed in sections III.C.3. and III.C.4. of
the proposed rule) prior to the application of the effective discount
factor, as described throughout sections III.D.4.b through e. of the
proposed rule.
CABG readmission AMI model episode benchmark price--
episode benchmark price assigned to certain AMI model episodes with
price MS-DRG 280-282 or 246-251 and with a readmission for MS-DRG 231-
236, as described in sections III.D.4.b.(2)(c) and III.D.4.e. of the
proposed rule.
Quality-adjusted target price--dollar amount assigned to
EPM episodes as the result of reducing the episode benchmark price by
the EPM participant's effective discount factor based on the EPM
participant's quality performance, as described in sections
III.D.4.b.(10) and III.E.3.f. of the proposed rule.
Excess EPM-episode spending--dollar amount corresponding
to the amount by which actual EPM-episode payments for all EPM episodes
attributed to an EPM participant exceed the quality-adjusted target
prices for the same EPM episodes, as discussed in section III.D.2.c. of
the proposed rule.
2. Performance Years, Retrospective Episode Payments, and Two-Sided
Risk EPMs
a. Performance Period
Consistent with the methodology for the CJR model, we proposed 5
performance years (PYs) for the EPMs, which would include EPM episodes
for the periods displayed in the following Table 9:
Table 9--Proposed Performance Years for EPMs
----------------------------------------------------------------------------------------------------------------
Performance year (PY) Calendar year EPM episodes included in performance year
----------------------------------------------------------------------------------------------------------------
1............................................ 2017 EPM episodes that start on or after July 1, 2017
and end on or before December 31, 2017.
2............................................ 2018 EPM episodes that end between January 1, 2018 and
December 31, 2018, inclusive.
3............................................ 2019 EPM episodes that end between January 1, 2019 and
December 31, 2019, inclusive.
4............................................ 2020 EPM episodes that end between January 1, 2020 and
December 31, 2020, inclusive.
5............................................ 2021 EPM episodes that end between January 1, 2021 and
December 31, 2021, inclusive.
----------------------------------------------------------------------------------------------------------------
As displayed in Table 9, some EPM episodes that would begin in a
given calendar year may be captured in the following performance year
due to some EPM episodes ending after December 31st of a given calendar
year. For example, EPM episodes beginning in December 2017 and ending
in March 2018 would be part of performance year 2. As we noted in our
proposed rule, we believe that the proposed period of time for the
EPMs, which generally aligns with the performance period for other
Innovation Center models, for example, the CJR and Pioneer ACO models,
should be sufficient to test and gather the data needed to evaluate the
EPMs (80 FR 73325). In contrast, we were concerned whether an EPM with
fewer than 5 performance years would be sufficient for these purposes.
We considered extending the first PY, for example, to 18 months. As
discussed further in section III.D.2.c. of the proposed rule, however,
we instead proposed to delay the requirement for participants to begin
accepting downside risk until the second quarter of PY2. As such, EPM
participants would have a comparable transition period to that of CJR
participants with respect to when they must accept downside risk while
still allowing us to make timely reconciliation payments to EPM
participants as well as to most effectively align EPM reconciliation
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with the reconciliation processes for other models and programs with
which the EPMs overlap (for example, the Shared Savings Program,
Pioneer ACO model, Comprehensive Primary Care Initiative, and Oncology
Care Model). As stated in our proposed rule, we believe that it is
important to synchronize the timing of reconciliation for EPMs with
other efforts that need this information when making their financial
calculations. We sought comment on this proposal.
The following is a summary of the comments received and our
responses.
Comment: Many commenters requested that CMS delay implementation of
the models; typically, for at least 6 months to a year--or a year from
the final rule's issuance--so that participants would have a sufficient
time to prepare for the new models. Some commenters recommended
delaying the models entirely until CMS had additional time to consider
evaluation results for BPCI or the CJR model. Other commenters
recommended a phased-in approach for implementing the models, for
example, by (1) first implementing the SHFFT model no sooner than
January 1, 2018 and then implementing the cardiac EPM models no sooner
than 6 months later as well as additional time if the final rule is
delayed beyond January 1, 2018 or (2) conversely delaying the SHFFT
model, given that hospitals are in the early stages of building
infrastructure for the CJR model and having to do so for the SHFFT
model as well could be too great a burden. A commenter recommended that
CMS delay the start date to January 1, 2018 as it would better align
with private payers' regulatory and business models, which are also
developing and rolling out bundled payment models. In their view, this
synchronization would reduce burden by simplifying record keeping
requirements, performance metric submission, and financial tracking by
both CMS and private payers.
Among the reasons cited for a delay, some commenters expressed
concern with the rapid pace of implementing additional models--
particularly, geographic-based models, which a number of commenters
have said they oppose. For example, commenters expressed concerns that
CMS was moving forward with new models in the absence of empirical
results from the CJR model or promising results from BPCI.
Specifically, results from the evaluation of year 2 results for BPCI
showed no statistically significant difference in Medicare payments and
an increase in mortality for the cardiovascular surgical episodes
between the BPCI participants (which were voluntary), and comparison
groups. Further, while there was a significant reduction in utilization
of institutional post-acute care settings, there were instances where
BPCI patients exhibited less functional improvement. As one commenter
noted, CMS has not yet been able to ensure that the quality of care and
beneficiary outcomes under the model are at least equivalent, if not
better than, those in traditional fee-for-service Medicare.
Commenters also pointed to the pre-implementation efforts that
would be needed for participants to be successful with episode payment
bundles, which they believe would take more time than would be granted
under the proposal. For example, hospitals need more time than proposed
to better understand the models' requirements and clinical and
financial risk of their patient populations; build the clinical, legal,
financial and quality infrastructure; analyze and understand the
clinical and cost factors that affect their performance; and identify
changes to care pattern to be successful. Moreover, there is
considerable variation in hospital preparedness and capabilities to
implement these models without a delay as well as challenges in doing
so while simultaneously fulfilling the requirements of multiple models
including the CJR model, MACRA, and the end of the grace period for
ICD-10.
A commenter noted that, given the broad-based clinical experience
with continuity-of-care across episodes, appropriate workforce capacity
and technology infrastructure, and significant investment by both the
public and private sectors needed to be successful, the cardiac models
could be particularly challenging. Further, these challenges could be
especially acute for small hospitals that often have limited financial
resources, have low case volume across which to spread financial
experience, have high amounts of uncompensated care or are located in
lower income geographic regions, do not yet have experience with
episode-based payments, or lack existing networks with physicians and
other providers. In addition to provider readiness, a commenter
questioned whether CMS has the administrative and personal resources to
manage the complexities of the newly proposed and expanded models in a
way that would meet hospitals' needs to be successful under the models.
Another commenter believed that, despite CMS proposing certain waivers
under the models, insufficient protections existed with regard to
regulatory and legal risk.
Response: We appreciate the concerns commenters expressed on our
proposed start date as well as their requests to delay the proposed
models. Our general goals for the proposed models are to improve care
quality for Medicare beneficiaries and efficiency in service delivery
to better control growth in Medicare spending. Hence, we wish to move
forward in implementing the proposed models as quickly as is reasonably
possible. Many commenters expressed concerns about their readiness to
participate in the models under our proposal; particularly, with the
requirement to assume downside risk within 6 months of the models being
implemented. We understand these concerns and share in hospitals'
desire to be successful in improving care and increasing efficiencies
under the models so that they earn reconciliation payments and Medicare
and its beneficiaries realize improvements in care and efficiency.
Thus, while we are not proposing to delay implementation of the models,
as discussed in section III.D.2.c. of this final rule, we are modifying
our proposal requiring participants to assume downside risk in the
second quarter of PY2 so that they would have an additional 9 months of
experience in the models without assuming downside risk. EPM
participants would not be required to assume downside risk for episodes
until PY3, but could voluntarily elect to do so in PY2. We believe that
delaying the requirement for participants to assume downside risk under
the models appropriately balances our interests in implementing the
models in a timely way with the concerns and interests of participants
with respect to their readiness to participate successfully in the
models as well as accommodate to the proposed requirements in
conjunction with other requirements under the Medicare program. As
such, we do not believe it is also necessary to further delay or phase-
in the models. Likewise, we do not believe it is necessary to delay our
models so that they are better aligned with private payer models. We
would further note that, beginning in PY2, our proposed models would
already follow the period suggested for this alignment to occur.
We do not agree with commenters that the models should be delayed
until additional BPCI or CJR model results are considered or in light
of the BPCI year 2 results. The currently proposed models will test
geographic-based bundled payments with a broader, more diverse, and
different group of participants or episodes than is the case
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with BPCI or the CJR model, which will expand our understanding of
these models with a broader and more complex array of conditions and
procedures. We also do not believe that the unique challenges that
could be presented under the cardiac models is a reason to delay the
models. Rather, among other things, we would expect these models to
assist us in empirically identifying what challenges there may be as
well as the steps needed to overcome them. We also share commenters'
concerns that smaller hospitals be successful under the models.
Accordingly, our proposed rule included additional protections to limit
financial risk for certain hospitals, including rural hospitals and
sole community hospitals, through more generous stop loss thresholds,
which we finalized in section III.D.7.c.(1) of this final rule. Also,
as discussed further in section III.D.7.c.(1) of this final rule, we
are extending these protections to hospitals determined to have a low
volume of episodes under an EPM.
We appreciate the comment on whether CMS is prepared
administratively and with respect to personnel resources to implement
the models, and note that the proposed models would not be implemented
in the absence of our readiness to do so. Finally, we have considered
and made final a range of waivers of program rules and provisions for
financial arrangements that we believe are necessary and sufficient to
facilitate participation in the models through allowing additional
flexibilities in care delivery and giving participants to the tools to
align the financial incentives of other providers, suppliers, and ACOs
with the goals of the EPMs (see sections III.I. and III.J. of this
final rule).
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
establish five performance years beginning with EPM episodes that start
on or after July 1, 2017 as displayed in Table 10.
Table 10--Final Performance Years for EPMs
----------------------------------------------------------------------------------------------------------------
Performance year (PY) Calendar year EPM episodes included in performance year
----------------------------------------------------------------------------------------------------------------
1............................................ 2017 EPM episodes that start on or after July 1, 2017
and end on or before December 31, 2017.
2............................................ 2018 EPM episodes that end between January 1, 2018 and
December 31, 2018, inclusive.
3............................................ 2019 EPM episodes that end between January 1, 2019 and
December 31, 2019, inclusive.
4............................................ 2020 EPM episodes that end between January 1, 2020 and
December 31, 2020, inclusive.
5............................................ 2021 EPM episodes that end between January 1, 2021 and
December 31, 2021, inclusive.
----------------------------------------------------------------------------------------------------------------
b. Retrospective Payment Methodology
Consistent with the CJR model (80 FR 73329), we proposed to apply a
retrospective payment methodology to the proposed EPMs (81 FR 50844).
Under this proposal, all providers and suppliers caring for Medicare
beneficiaries in EPM episodes would continue to bill and be paid as
usual under the applicable Medicare payment systems. After the
completion of an EPM performance year, Medicare claims for services
furnished to EPM beneficiaries would be grouped into EPM episodes and
aggregated, and EPM participants' actual EPM episode-payments would be
compared to quality-adjusted target prices (which account for the level
of EPM episode quality), as described in section III.D.5.a. of the
proposed rule (81 FR 50864 through 50865). Based on an EPM
participant's performance (taking into account quality and spending),
we would determine if Medicare would make a payment to the participant
(reconciliation payment), or if the participant owes money to Medicare
(resulting in Medicare repayment).
We considered an alternative option of paying for EPM episodes
prospectively by paying one lump sum amount to the EPM participant for
the expected spending for the EPM episode which extends 90 days post-
hospital-discharge. However, as was the case when we established
regulations for the CJR model (80 FR 73329), we believed that such an
option would be challenging to implement at this time given the payment
infrastructure changes for both EPM participants and Medicare that
would need to be developed to pay and manage prospective episode
payments under these EPMs. Moreover, we continued to believe that a
retrospective payment approach can accomplish the objective of testing
episode payments in a broad group of hospitals, including financial
incentives to streamline care delivery around that episode, without
requiring core billing and payment changes by providers and suppliers,
which would create substantial administrative burden.
We sought comment on this proposal. The following is a summary of
the comments received and our responses.
Comment: Most of the comments supported CMS' proposal to use a
retrospective payment methodology. Commenters agreed with CMS' view
that this would be the most administratively feasible and
straightforward payment option since it uses the existing payment
system infrastructure and processes. Some of these commenters reported
that alternatively applying a prospective payment methodology, which
would make one lump sum payment to the hospital for the episode, would
be challenging to implement given the administrative and infrastructure
changes it would entail for hospitals, other participating providers
and Medicare. One commenter expressed concern that our proposed models
would, in fact, require all payments be made to the responsible
hospital so that other providers would have to submit bills for
services they provided under an EPM episode to that hospital, which the
commenter believed could result in both decreased access to care and
increased administrative complexity.
Response: We appreciate the comments we received that were in
support of our proposed retrospective payment methodology, and concur
with commenters' views on some of the benefits of this model. We would
clarify that, as stated previously in this section, all providers and
suppliers caring for Medicare beneficiaries in EPM episodes would
continue to bill and be paid as usual under the applicable Medicare
payment systems. As such, providers would submit claims for payment as
they always have and would not submit claims to the responsible
hospital.
Comment: While not opposing the proposal, a commenter expressed the
view that a retrospective model should be viewed as a stepping stone
toward rather than the destination to requiring greater levels of
financial risk. In their view, disadvantages of a retrospective model
include their potential to reduce spending within an episode of care
but not the volume of the episodes themselves, which could encourage a
greater number of bundled procedures;
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fragmentation of care delivery due to the existence of multiple bundled
payment programs designed around different disease states or
procedures; and the potential that the considerable cost and effort
expended to organize people and systems around each bundled episode
could cause the total cost of these programs combined to be higher than
the cost associated with operating a single program covering the full
population and the full spectrum of care. As such, the commenter
supported the proposed bundled payments for a limited time and for the
purpose of stimulating efforts to full population based efforts.
Response: We understand the commenter's view that bundled payments
could be a stepping stone toward other models that establish greater
risk for providers and recognize the various limitations of a fee-for-
service system with respect to higher volume of services and less
coordinated delivery of care. In contrast to the commenter, however, we
believe in and hence are empirically testing within our proposed models
the potential to improve upon these dimensions as well as assist in
lowering the cost of services within a fee-for-service rather than
capitated framework.
Comment: Some commenters opposed the proposed retrospective
methodology. For example, a commenter reported their view that the
proposed retrospective payment model would limit the possibility for
real, innovative care redesign because it (1) offered no upfront
incentive dollars to invest in new care delivery models and services
that could deliver true value and (2) confined innovation care redesign
by what the FFS structure will reimburse. That is, while participants
would be held financially accountable for ensuring that care is
delivered below the quality-adjusted target price, they could do little
to affect the costs for the episode within their own setting as they
continue to receive a MS-DRG payment for the diagnosis regardless of
whether the patient stays a longer or shorter period of time,
additional services are offered, or care coordination is provided.
Thus, if a participant seeks to reduce costs, it is limited to reducing
readmissions, improving care transitions, or reducing post-acute care
costs--either by reducing the length of stay within a SNF (as it is
paid on a per diem) or through substitutions of care (for example,
directly discharging the patient home with or without services). In
this commenter's view, significant care redesign would be better
facilitated through providing a group of provider partners with a
prospective payment.
Similarly, a commenter suggested that participants are impeded in
their ability to plan for the delivery of services if they do not know
how much money will be available to support those services. As such,
participants should have a risk-adjusted budget for the condition or
episode in advance rather than after care has already been delivered.
Further, payment amounts should be based on the actual costs of all of
the services being delivered, not just the amounts that would have been
paid under the fee-for-service system for the subset of services that
would have been separately billable. As such, the commenter recommended
that participants and their collaborators be paid for high-value
services that are not currently billable as part of condition-based and
episode-based payment models if providers have agreed to be accountable
for overall spending related to a condition or episode.
Another commenter recommended that CMS determine payment benchmarks
through negotiated rates or competitive bids (rather than fee-for-
service claims) as it would foster more rapid transformation in cost
and resource use as well as encourage competition among providers to
achieve the best outcomes for the lowest cost. In their view, a
prospective negotiated rate would offer providers more opportunity to
innovate in how they deploy professional staff, choose technology, and
engage with outpatient and home-based services. Also, a prospectively
negotiated case rate would foster collaboration among all clinicians
involved in patient care and provide predictable pricing.
Response: We appreciate the concerns and challenges raised by these
commenters, but are not persuaded to change our methodology. Rather, we
believe that participants are capable of innovative care redesign in
the absence of upfront incentives dollars and within the constraints of
fee-for-service Medicare payment requirements. While our proposal did
not provide participants with an up-front budget or a capitated payment
amount, we would be providing them detailed information on their
benchmark and likely quality-adjusted target prices as well as their
financial performance both historically and during their participation
in the models (see section III.K. of this final rule). We believe this
information should be sufficient to enable participants' abilities to
assess their performance as well as determine and plan changes in their
practices to make them successful. Also, where appropriate, we have
offered participants improved flexibilities under the models by waiving
certain Medicare requirements and allowing for financial arrangements,
which should facilitate their participation under the models (see
sections III.I. and III.J. of this final rule). To the extent, we
identify additional adjustments, we could consider them through future
rulemaking. Finally, while we wish to explore and test a range of
payment models, which could include capitated or competitive bidding
models, the purpose of the proposed models is to examine ways in which
to improve health care quality and reduce costs in a fee-for-service
framework.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification to
implement a retrospective payment methodology. Also, we would like to
clarify that when referring to Medicare claims data for services
furnished to EPM beneficiaries, as we have stated immediately here and
throughout this section, we mean any payment from the Part A or Part B
trust fund on behalf of a beneficiary that is not specifically excluded
as specified in section III.C. or III.D.6 of this final rule.
Consistent with this, we have made conforming changes to our regulatory
text--specifically, to our definition of actual episode payments as
well as to Sec. 512.305(c)(1) and Sec. 512.307(a)(1).
c. Two-Sided Risk EPMs
As we did for the CJR model (80 FR 73229 through 7333), we proposed
to establish two-sided risk for EPM participants (81 FR 50844). Under
this proposal, for each of performance years 1 through 5, we would make
EPM-episode reconciliation payments to EPM participants that achieve
reduced actual EPM payments relative to their quality-adjusted target
prices. Likewise, beginning with episodes ending in the second quarter
of performance year 2 and extending through each of performance years 3
through 5, we would hold EPM participants responsible for repaying
Medicare when their actual EPM-episode payments exceed their quality-
adjusted target prices. As such, our proposal differed from CJR in that
we proposed a modestly shorter period in which EPM participants would
accept downside risk in order to allow them a comparable transition
period to that of CJR participants in which to do so. Accordingly, we
referred to the two portions of performance year 2 as either having no
downside risk (NDR) or having downside risk (DR); specifically--
Performance Year 2 (NDR) or PY 2 (NDR) for the first
quarter, that is
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January 1, 2018 to March 31, 2018, in which EPM participants assume no
downside risk and therefore would have no Medicare repayment
responsibility; and
Performance Year 2 (DR) or PY 2 (DR) for the second, third
and fourth quarters, that is April 1, 2018 to December 31, 2018, in
which EPM participants assume downside risk and would have Medicare
repayment responsibility.
Our proposed rule noted our continued belief that our proposal to
establish two-sided risk would provide appropriate incentives for EPM
participants to improve their care quality and efficiency under the
EPMs, and that we would diminish these incentives if we instead
proposed to establish one-sided risk, in which an EPM participant could
qualify for a reconciliation payment but not be held responsible for
Medicare repayments. In recognition that EPM participants may need to
make infrastructure, care coordination and delivery, and financial
preparations for the EPMs, which can take several months or longer to
implement, we thought that it was reasonable to delay EPM participant
responsibility for repaying excess EPM-episode spending in performance
year 1 to more strongly align EPM-participant incentives with care
quality. Thus, similar to what we did for the CJR model, we proposed to
phase-in this repayment responsibility beginning in the second quarter
of EPM performance year 2 as displayed in Table 11 (81 FR 50844 through
50845).
Table 11--Proposed Stop-Loss Thresholds and Discount Percentage Ranges for Medicare Repayments by PY
--------------------------------------------------------------------------------------------------------------------------------------------------------
Performance year PY1 PY2 (NDR) PY2 (DR) (%) PY3 (%) PY4 (%) PY5 (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Stop-loss threshold..................................... n/a as no downside risk in PY1 5 10 20 20
or first quarter of PY2
Discount percentage (range) for Repayment, Depending on 0.5-2.0 0.5-2.0 1.5-3.0 1.5-3.0
Quality Category.......................................
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Stop-loss thresholds for certain hospitals, including rural and sole-community hospitals are 3% for PY2 (DR) and 5% for PY3-PY5.
We refer to section III.E.3.f. of this final rule for additional
information on the effective discount factors used to calculate
quality-adjusted target prices, as well as the quality categories that
determine an EPM participant's effective discount factor that would be
applied to the EPM benchmark episode price at reconciliation to
calculate the repayment amount during the phase-in period under the
models.
We sought comment on this proposal. The following is a summary of
the comments received and our responses.
Comment: A number of commenters supported CMS' proposal to phase-in
downside risk noting that doing so would allow providers with little or
limited experience and who were not ready to take on risk additional
time to prepare to do so. However, nearly all of the commenters on this
proposal urged CMS to extend the period of time during which
participants would not be subject to downside risk as 6 months would
not be an adequate timeframe in which to begin managing episodes that
will be subject to downside risk. A number of commenters noted that
because of the way that episodes are defined during a performance year,
participants would actually have only 6 months before episodes that
will incur downside risk begin. This is because the models would begin
on July 1, 2017 and downside risk would begin for episodes ending April
1, 2018 and later. However, episodes that end April 1, 2018 would have
begun over 90 days earlier, or prior to January 1, 2018. Therefore,
participants would actually only have from July 1, 2017 until about
January 1, 2018 before episodes that will incur downside begin.
Most of the commenters requested a 12-month period during which
participants would not be required to assume downside risk with some
commenters requesting longer periods, for example, up to 2 years. In
some cases, commenters requested that CMS delay the requirement to
assume downside risk, but to allow participants flexibility to assume
risk earlier if they wished to do so. A commenter requested that CMS
stagger downside risk across the models, for example, allow a longer
period without downside risk for AMI episodes than for CABG episodes as
the commenter believed there was greater complexity and uncertainty
associated with the former than the latter. Additionally, several
commenters opposed the proposal to require downside risk altogether or
asking that CMS make this requirement contingent upon also further
risk-adjusting target prices and financial performance data.
The reasons offered for delaying downside risk often paralleled
those for delaying the models in general--that is, additional time is
needed to develop infrastructure and expertise with the models. Some
commenters raised concerns about the effects of the proposal on
beneficiary access; particularly, for smaller hospitals and academic
medical centers. As such, a commenter expressed support for CMS' plans
to monitor access and recommended that CMS publish data and consider
alternatives if this is found among complicated AMI or CABG cases.
A commenter suggested that CMS completely waive downside risk for
certain protected hospitals such as SCHs, MDHs, RRCs, and low-volume
hospitals. Another commenter stated that participants should not have
to take on additional risk given they are already facing payment
reductions through other efforts such as those for the HRRP. If
participants must face downside risk through the proposed models, the
commenter requested that CMS exclude conditions under the model from
the HRRP. Some commenters pointed to delays in receiving performance
data from CMS as well as time need to review these data needed to
assist them in assessing and adjusting care patterns. Commenters also
noted that because not all participants have had experience with
bundled payment models, they are likely not ready to assume downside
risk.
In addition to comments requesting that CMS delay downside risk,
commenters also requested that EPM participants be permitted to
voluntarily adopt downside risk sooner, for example, to fulfill one of
the requirements to qualify as participating in an Advanced APM.
Response: We appreciate comments supporting our proposal to phase-
in downside risk. We are also persuaded by commenters that delaying the
date by which participants would be required to
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assume downside risk would improve participants' ability to
successfully achieve the goals of the models. Accordingly, we are
revising our proposal so that participants in the proposed models would
not be required to assume downside risk until PY3--that is, episodes
ending on or after January 1, 2019, with anchor discharges that occur
on or after October 4, 2018. We believe that this delay period
appropriately balances participants' desire for additional experience
under the models in the absence of downside risk with our desire to
establish appropriate incentives for improved care quality and cost
control. Given we believe this delay period is sufficient for all
models, we do not believe it necessary to stagger downside risk
separately by model. We also disagree with comments opposing our
proposal to require downside risk or asking that CMS make this
requirement contingent upon our also further risk-adjusting target
prices and financial performance data. First, we believe downside risk
is necessary for purposes of establishing appropriate provider
incentives. Second, as discussed in section III.D.4.b.(2). of this
final rule, we plan to explore additional risk-adjustment options that
could be implemented beginning in PY3 and would thus apply to episodes
that would be subject to downside risk for all participants.
While we are delaying the requirement to assume downside risk under
the models, we have decided to allow EPM participants, including those
seeking to qualify as participating in an Advanced APM, to voluntarily
begin to assume downside risk for episodes ending on or after January
1, 2018, with anchor discharges that occur on or after October 4, 2017.
Table 12 presents our final policies for phasing-in downside risk for
all participants, along with associated stop-loss limits and discount
percentages, for participants that voluntarily assume risk on this
accelerated schedule.
We appreciate the concerns raised on the potential effects of our
proposal on beneficiary access to care, and would note that we have
made final a range of quality measures (see section III.E. of this
final rule), monitoring activities (see section III.G. of this final
rule), and compliance efforts (see section III.F. of this final rule)
that would address beneficiary access issues. We disagree with the
suggestions to waive downside risk for certain protected hospitals such
as SCHs, MDHs, RRCs, and low-volume hospitals or given that hospitals
are already facing payment reductions through other efforts. We believe
that the additional protections we included, which limit total
financial risk under the models for these protected hospitals, are
sufficient (see section III.D.7.c.(2). of this final rule). We also
recognize that while a participant could experience payment reductions
under both the proposed models and the HRRP, we disagree that they
should be held harmless from either of these potential reductions. The
payment reductions participants would potentially face under the
proposed models are not dissimilar to the potential reductions
hospitals already simultaneously face for programs such as the HRRP,
HAC, and EHR incentives without exemption.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, with modification, to phase-
in downside risk. Accordingly, we are delaying the requirement to
assume downside risk by 9 months so that episodes ending on or after
January 1, 2019 would assume downside risk as compared to our proposal
that would have required this for episodes that ended on or after April
1, 2018 and beyond. Also, we are allowing participants to voluntarily
elect downside risk for episodes ending on or after January 1, 2018.
Table 12 presents our final policies on this in conjunction with
modified stop-loss thresholds and discount percentages by performance
year. These final policies are further discussed in sections
III.D.7.b.(1), III.D.7.c.(1) and III.E.3.f of this final rule,
respectively.
Table 12--Final Stop-Loss Thresholds and Discount Percentage Ranges for Medicare Repayments by PY
----------------------------------------------------------------------------------------------------------------
PY1 PY2 (%) PY3 (%) PY4 (%) PY5 (%)
----------------------------------------------------------------------------------------------------------------
Downside Risk for All Participants--DR effective for episodes ending on or after 1/1/2019
(anchor discharges occurring on or after 10/4/2018)
----------------------------------------------------------------------------------------------------------------
Stop-loss threshold............. n/a as no downside risk in PY1 5 10 20
and PY2 without election of
voluntary downside risk for
PY2
Stop-loss threshold for certain 3 5 5
hospitals *....................
Discount percentage (range) for 0.5-2.0 0.5-2.0 1.5-3.0
Repayment, Depending on Quality
Category.......................
----------------------------------------------------------------------------------------------------------------
Voluntary Downside Risk--DR effective for episodes ending on or after 1/1/2018
(anchor discharges occurring on or after 10/4/2017)
----------------------------------------------------------------------------------------------------------------
Stop-loss threshold............. n/a as no 5 5 10 20
downside risk
in PY1
Stop-loss threshold for certain .............. 3 3 5 5
hospitals *....................
Discount percentage (range) for .............. 0.5-2.0 0.5-2.0 0.5-2.0 1.5-3.0
Repayment, Depending on Quality
Category.......................
----------------------------------------------------------------------------------------------------------------
* Including rural and sole-community hospitals, rural referral centers, Medicare Dependent Hospitals and
hospitals determined to be EPM volume protection hospitals within an EPM.
[[Page 295]]
3. Adjustments to Actual EPM-Episode Payments and to Historical Episode
Payments Used To Set Episode Prices
a. Overview
Using Medicare payments for Parts A and B claims for services
included in the EPM episode definitions, we proposed to calculate
historical episode payments (3 years of historical Medicare payment
data grouped into EPM episodes), EPM-quality-adjusted target prices,
and actual EPM-episode payments according to the EPM episode
definitions as discussed in sections III.C.3. and III.C.4. of the
proposed rule (81 FR 50829 through 50843) as we did for the CJR model.
As was the case for the CJR model (80 FR 73330 through 73336), we also
proposed to include certain payment adjustments in the EPMs for: (1)
Special payment provisions under existing Medicare payment systems; (2)
payments for services that straddle episodes; and (3) high payment
episodes (81 FR 50846). We also proposed to additionally include an
adjustment for reconciliation payments and Medicare repayments when
updating EPM participant episode benchmark and quality-adjusted target
prices (81 FR 50847). We refer to section III.D.6. of the proposed rule
for discussion of adjustments for overlaps with other Innovation Center
models and CMS programs (81 FR 50867 through 50872).
b. Special Payment Provisions
Many of the existing Medicare payment systems have special payment
provisions that have been created by regulation or statute to improve
quality and efficiency in service delivery. IPPS hospitals are subject
to incentives under the HRRP, the HVBP Program, the Hospital-Acquired
Condition (HAC) Reduction Program, and the HIQR Program and Outpatient
Quality Reporting (OQR) Program. IPPS hospitals and CAHs are subject to
the Medicare Electronic Health Record (EHR) Incentive Program.
Additionally, the majority of IPPS hospitals receive additional
payments for Medicare Disproportionate Share Hospital (DSH) and
Uncompensated Care, and IPPS teaching hospitals can receive additional
payments for Graduate Medical Education (GME) and Indirect Medical
Education (IME). IPPS hospitals that meet certain requirements related
to low volume Medicare discharges and distance from another hospital
receive a low volume add-on payment. Also, some IPPS hospitals qualify
to be sole community hospitals (SCHs) or Medicare Dependent Hospitals
(MDHs), and they may receive enhanced payments based on cost-based
hospital-specific rates for services; whether a SCH or MDH receives
enhanced payments may vary year to year, in accordance with Sec.
419.43(g) and Sec. 412.108(g), respectively.
Medicare payments to providers of post-acute care services,
including IRFs, SNFs, IPFs, HHAs, LTCHs, and hospice facilities, are
conditioned, in part, on whether the provider satisfactorily reports
certain specified data to CMS: Inpatient Rehabilitation Facility
Quality Reporting Program (IRF QRP); Skilled Nursing Facility Quality
Reporting Program (SNF QRP); Inpatient Psychiatric Facility Quality
Reporting Program (IPF QRP); Home Health Quality Reporting Program (HH
QRP); Long-Term Care Hospital Quality Reporting Program (LTCH QRP); and
Hospice Quality Reporting Program. Additionally, IRFs located in rural
areas receive rural add-on payments, IRFs serving higher proportions of
low-income beneficiaries receive increased payments according to their
low-income percentage (LIP), and IRFs with teaching programs receive
increased payments to reflect their teaching status. SNFs receive
higher payments for treating beneficiaries with human immunodeficiency
virus (HIV). HHAs located in rural areas also receive rural add-on
payments.
Ambulatory Surgical Centers (ASCs) have their own Quality Reporting
Program (ASC QRP). Physicians also have a set of special payment
provisions based on quality and reporting: Medicare EHR Incentive
Program for Eligible Professionals; Physician Quality Reporting System
(PQRS); and Physician Value-based Modifier Program.
Consistent with how we determine payments under the CJR model (80
FR 73333), we proposed to adjust both the actual and historical EPM-
episode payments used to set EPM-episode benchmark and quality-adjusted
target prices by excluding these special payments from EPM-episode
calculations using the CMS Price Standardization methodology (81 FR
50846). Our proposed rule noted our view that in applying this
methodology to exclude these payments from our calculations, we would
best maintain appropriate incentives for both the EPMs and the existing
incentive programs. Also, not excluding add-on payments based on the
characteristics of providers caring for EPM beneficiaries, such as more
indigent patients, having low Medicare hospital volume, being located
in a rural area, supporting greater levels of physician training, and
having a greater proportion of beneficiaries with HIV, from actual EPM-
episode payments could inappropriately result in certain EPM
participants that receive more add-on payments having worse episode
payment performance compared to quality-adjusted target prices than
what their performance would otherwise have been. Additionally, not
excluding enhanced payments for MDHs and SCHs could result in higher or
lower quality-adjusted target prices just because EPM participants
received their enhanced payments in 1 historical year but not the
other, regardless of actual utilization. We also noted that excluding
special payments would ensure an EPM participant's actual episode
payment performance is not artificially improved or worsened because of
payment reduction penalties or incentives or enhanced or add-on
payments, the effects of which we were not intending to test under the
models. In addition to the various incentives, enhanced payments, and
add-on payments, we noted that sequestration came into effect for
Medicare payments for discharges on or after April 1, 2013, per the
Budget Control Act of 2011 and delayed by the American Taxpayer Relief
Act of 2012. Sequestration applies a 2-percent reduction to Medicare
payment for most Medicare FFS services.
For more information on the CMS Price (Payment) Standardization
Detailed Methodology, we referred to the QualityNet Web site at http://www.qualitynet.org/dcs/ContentServer?c=Page&pagename=QnetPublic%2FPage%2FQnetTier4&cid=1228772057350 and to 80 FR 73331. Accordingly, we proposed to exclude these
special payments from EPM-episode calculations using the CMS Price
Standardization methodology at Sec. 512.300(e)(2). We sought comment
on our proposal to exclude special payments using the CMS Price
Standardization methodology.
The following is a summary of the comments received and our
responses.
Comment: Commenters generally supported the proposal to adjust
actual and target spending amounts for various special payments such as
IME and DSH.
Response: We appreciate the comments we received supporting our
proposal to exclude special payments from EPM-episode calculations
using the CMS Price Standardization methodology. We wish to clarify
that like CJR, we will follow the CMS Price Standardization methodology
with modifications as necessary to be consistent with our episode
definition in section III.C of this final rule and to ensure timely
reporting of reconciliation
[[Page 296]]
results, for the performance year reconciliations, which begin 2 months
after the conclusion of a performance year. We will account for the
information available at the time due to claims run-out, payment system
updates, and the calculations necessary to fully implement the
standardization methodology. We will utilize the methodology,
consistent with our episode definition, for the target price
calculations and subsequent reconciliation calculations 14 months after
the conclusion of the performance year, in which we incorporate full
claims run-out and further account for overlap with other models. This
approach will provide feedback and reconciliation payments, as
available, to hospitals in a timely manner and as accurately as
feasible, while ensuring the standardization approach is utilized for
the subsequent reconciliation calculation for a performance year.
Comment: Commenters requested more clarity on whether IPPS capital
payments are included, and requested that we exclude these costs. A
commenter noted that these capital costs are not included under the
BPCI models, hospitals need stability in capital cost reimbursement to
plan for major capital expenditures, and thus these costs should not be
placed at risk because of models affecting only cardiovascular and
orthopedic services.
Response: To clarify, as is the case with CJR, IPPS capital
payments will be included in EPM-episode calculations. As we stated in
the CJR Final Rule (80 FR 73333), these payments are included in
Medicare FFS payments, which we use to calculate benchmark and actual
expenditures. Further, including IPPS capital payments affords
participants an opportunity to achieve greater reconciliation payments
if they are able to achieve efficiencies for the costs that the capital
portion of IPPS payments would cover, which may or may not actually be
capital costs.
Comment: A commenter requested that CMS exclude outlier payments
EPM-episode calculations. The commenter expressed concern that because
CMS proposed a limited risk-adjustment methodology, hospitals that
treat the least healthy beneficiaries such as academic medical centers
would be penalized for longer lengths of stay that result in receiving
outlier payments for the index admission, particularly as financial
targets transition to regional pricing.
Response: We disagree that outlier payments should be excluded from
our calculation. First, we expect the models to encourage more
efficient care that should result in lower costs and potentially the
frequency for which outlier payments are needed. Second, as discussed
in section III.D.3.d. of this final rule, we are finalizing policies to
cap high-cost episodes with payments 2 standard deviations or more
above the mean calculated at the regional level for purposes of
determining benchmark prices and actual expenditures, which should
assist in protecting participants from higher costs associated with
outlier payments. Third, as discussed in section III.D.4.b.(2). of this
final rule, we will be exploring options to further risk-adjust costs
and payments under the models with the goal of making them effective
for episodes ending after January 1, 2019, with anchor discharges
occurring on or after October 4, 2018. These further adjustments for
risk would offer additional financial protections to participants with
high-cost episodes.
Comment: Several commenters recommended that costs for chronic care
management, cardiac rehabilitation, and intensive cardiac
rehabilitation services be excluded from payment calculations. With
regard to the former, the commenter noted that chronic care management
services were not paid under Medicare until January of 2015 and
therefore was not a payable service during two of the years used to set
target prices for the first two performance year. Further, in this
commenter's view, many physicians currently are not billing for these
services, but the commenter anticipates the volume will increase. With
regard to the latter, commenters noted that if the proposed efforts to
encourage CR utilization are successful, spending for CR/ICR services
in AMI and CABG episodes would increase and could cause participants'
spending to exceed their targets making them either ineligible to
receive reconciliation payments or at risk for making Medicare
repayments. As such, this would penalize hospitals for improving CR/ICR
utilization, which would impede, if not completely defeat, CMS' efforts
to encourage CR and ICR utilization. Accordingly, these commenters
recommended that the cost of CR and ICR services be excluded from
episode payment calculations.
Response: As we noted in section III.C.3.b. of this final rule, we
do not believe that it would be appropriate to exclude other specific
Part B services, including chronic are management services, cardiac
rehabilitation, intensive cardiac rehabilitation services that are
related to the clinical conditions that are the basis for EPM episodes,
just because they are underrepresented in the baseline period upon
which benchmark episode prices are set. Likewise, we do not believe it
is appropriate to exclude the costs of these included services from our
financial calculations. To the extent that care redesign under the EPMs
increases utilization of these services to improve episode quality and
efficiency, periodic updates to the 3 years of historical data used to
establish EPM-episode benchmark prices, as is discussed in section
III.D.4.b.(3) of this final rule, would result in greater
representation of these services that reflect more recent care
patterns.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
exclude certain special payments from EPM-episode calculations using
the CMS Price Standardization methodology. Our final policy for
excluding special payments is included in Sec. 512.300(e)(2).
c. Services That Straddle Episodes
A service that straddles an EPM episode is one that begins before
the start of or continues beyond the end of an EPM episode that extends
90 days post-hospital discharge. Under the CJR model, we prorate
payments so that they include only the portion of the payment that is
included in the CJR model episode, using separate approaches to prorate
payments under each payment system, for example, IPPS, non-IPPS and
other inpatient services, and home health services (80 FR 73333 through
73335). We proposed to apply the CJR model methodologies for prorating
payments when calculating actual EPM-episode payments and when
calculating historical EPM-episode payments used to set EPM-episode
benchmark and quality-adjusted target prices (81 FR 50846). We believed
these methodologies would most accurately account for spending within
EPM episodes under the EPMs. The methodologies for prorating payments
under the EPMs were included in Sec. 512.300(f). We sought comment on
our proposed methodologies for prorating payments.
The following is a summary of the comments received and our
responses.
Comment: We received comments requesting greater clarity on how we
would prorate payments for services that straddle episodes. We also
received a comment requesting greater clarity for ``prorated'' payments
for ``straddled'' episodes with the presence of an AMI diagnosis
treated with CABG.
Response: Following are the steps we use for the CJR model that we
proposed to apply when prorating payments under the proposed EPMs, and
that were specifically cited in our proposed rule (80 FR 73333 through
73335).
[[Page 297]]
These steps have been updated to reflect our methodology as applied to
an AMI episode involving a CABG.
In general, assuming we have a beneficiary in an EPM episode who is
admitted to a SNF for 15 days, beginning on Day 86 post-discharge from
the anchor EPM hospitalization, the first 5 days of the admission would
fall within the episode, while the subsequent 10 days would fall
outside of the episode. Under our proposal, to the extent that a
Medicare payment for included episode services spans a period of care
that extends beyond the episode, these payments would be prorated so
that only the portion attributable to care during the episode is
attributed to the episode payment when calculating actual Medicare
payment for the episode.
For non-IPPS inpatient hospital (for example, CAH) and inpatient
post-acute care (for example, SNF, IRF, LTCH, IPF) services, we would
prorate payments based on the percentage of actual length of stay (in
days) that falls within the episode window. Prorated payments would
also be similarly allocated to the 30-day post-episode payment
calculation in section III.D.7.e. of this final rule. In the previous
example, one-third of the days in the 15-day length of stay would fall
within the episode window, so under the proposed approach, one-third of
the SNF payment would be included in the episode payment calculation,
and the remaining two-thirds (because the entirety of the remaining
payments fall within the 30 days after the episode ended) would be
included in the post-episode payment calculation.
For HHA services that extend beyond the episode, the payment
proration would be based on the percentage of days, starting with the
first billable service date (``start of care date'') and through and
including the last billable service date, that fall within EPM episode.
Prorated payments would also be similarly allocated to the 30-day post-
episode payment calculation in section III.D.7.e. of this final rule.
For example, if the patient started receiving services from an HHA on
day 86 after discharge from the anchor hospitalization and the last
billable home health service date was 55 days from the start of home
health care date, the HHA claim payment amount would be divided by 55
and then multiplied by the days (5) that fell within the EPM episode.
The resulting, prorated HHA claim payment amount would be considered
part of the EPM episode. Services for the prorated HHA service would
also span the entirety of the 30 days after the EPM episode spends, so
the result of the following calculation would be included in the 30-day
post-episode payment calculation: HHA claim payment amount divided by
55 and then multiplied by 30 days (the number of days in the 30-day
post-episode period that fall within the prorated HHA service dates).
There may also be instances where home health services begin prior
to the EPM episode start date, but end during the EPM episode. In such
instances, we would also prorate HHA payments based on the percentage
of days that fell within the episode. Because these services end during
the EPM episode, prorated payments for these services would not be
included in the 30-day post-episode payment calculation discussed in
section III.D.7.e. of this final rule. For example, if the patient's
start of care date for a home health 60-day claim was February 1, the
anchor hospitalization was March 1 through March 4 (with the EPM
episode continuing for 90 days after March 4), and the patient resumed
home care on March 5 with the 60-day home health claim ending on April
1 (that is, April 1 was the last billable service date), we would
divide the 60-day home health claim payment amount by 60 and then
multiply that amount by the days from the EPM admission through April 1
(32 days) to prorate the HHA payment. This proposed prorating method
for HHA claims is consistent with how partial episode payments (PEP)
are paid for on home health claims.
For IPPS services that extend beyond the episode (for example,
readmissions included in the episode definition), we would separately
prorate the IPPS claim amount from episode target price and actual
episode payment calculations as was made final in the final CJR rule
(80 FR 73334 through 73335), called the normal MS-DRG payment amount
for purposes of this final rule. The normal MS-DRG payment amount would
be pro-rated based on the geometric mean length of stay, comparable to
the calculation under the IPPS post-acute care transfer policy at Sec.
412.4(f) and as published on an annual basis in Table 5 of the IPPS/
LTCH PPS Final Rules. Consistent with the IPPS post-acute care transfer
policy, the first day for a subset of MS-DRGs (indicated in Table 5 of
the IPPS/LTCH PPS Final Rules) would be doubly weighted to count as 2
days to account for likely higher hospital costs incurred at the
beginning of an admission. If the actual length of stay that occurred
during the episode is equal to or greater than the MS-DRG geometric
mean, the normal MS-DRG payment would be fully allocated to the
episode. If the actual length of stay that occurred during the episode
is less than the geometric mean, the normal MS-DRG payment amount would
be allocated to the episode based on the number of inpatient days that
fall within the episode. If the full amount is not allocated to the
episode, any remainder amount would be allocated to the 30 day post-
episode payment calculation discussed in section III.D.7.e. of this
final rule. The proposed approach for prorating the normal MS-DRG
payment amount is consistent with the IPPS transfer per diem
methodology.
More specifically, if a beneficiary has a readmission for MS-DRG
234--coronary bypass with cardiac catheterization without major
complications or comorbidities--into an IPPS hospital on the 89th day
after discharge from an EPM anchor hospitalization, and is subsequently
discharged after a length of stay of 5 days, Medicare payment for this
readmission would be prorated for inclusion in the episode. Based on
Table 5 of the IPPS/LTCH PPS Final Rule for FY 2017, the geometric mean
for MS-DRG 234 is 8 days, and this MS-DRG is indicated for double-
weighting the first day for proration. This readmission has only 2 days
that falls within the episode, which is less than the MS-DRG 234
geometric mean of 8 days. Therefore, the normal MS-DRG payment amount
associated with this readmission would be divided by 8 (the geometric
mean) and multiplied by 3 (the first day is counted as 2 days, and the
second day contributes the third day), and the resulting amount is
attributed to the episode. The remaining five-eighths would be captured
in the post-episode spending calculation discussed in section
III.D.7.e. of this final rule. If the readmission occurred on the 82nd
day after discharge from the EPM anchor hospitalization, and the length
of stay was 10 days, the normal MS-DRG payment amount for the admission
would be included in the episode without proration because length of
stay for the readmission falling within the episode (9 days) is greater
than or equal to the geometric mean (8 days) for the MS-DRG. We would
also clarify that, consistent with how we would prorate payments for
services that extend beyond the episode when establishing benchmark
prices for an AMI episode without a CABG, in instances of an AMI
episode with CABG readmissions, we would establish the benchmark price
based on prorated amounts for both the AMI episode and the CABG
readmission.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without
[[Page 298]]
modification, to prorate payments for services that straddle episodes.
Our final policy for prorating payments is included in Sec.
512.300(f).
d. High-Payment EPM Episodes
For the CJR model, we defined a high-payment episode as an episode
with payments 2 standard deviations or more above the mean calculated
at the regional level (80 FR 73336 through 73337). As with the CJR
model, we proposed to apply a high-payment episode ceiling when
calculating actual EPM-episode payments and when calculating historical
EPM-episode payments used to set EPM-episode benchmark and quality-
adjusted target prices (81 FR 50846). We proposed to apply the ceiling
according to the following groupings that align with our proposed EPM
price-setting methodology.
First, for SHFFT model episodes, we proposed to calculate and apply
the ceiling separately for each SHFFT price MS-DRG at the regional
level.
Second, for AMI model episodes with price MS-DRGs 280-282 or 246-
251 without readmission for CABG MS-DRGs, we proposed to calculate and
apply the ceiling separately for each price MS-DRG at the regional
level.
Third, for CABG model episodes, we proposed to apply ceilings
separately to the payments that occurred during the anchor
hospitalization of the CABG model episode and to the payments that
occurred after the anchor hospitalization. For the anchor
hospitalization portion of CABG model episodes, we proposed to
calculate and apply the ceiling separately by each price MS-DRG in 231-
236 at the regional level. For the post-anchor hospitalization portion,
we proposed to calculate and apply the ceiling separately for the
following groupings at the regional level:
With AMI ICD-CM diagnosis code on the anchor inpatient
claim and price MS-DRG with major complication or comorbidity (231,
233, or 235).
With AMI ICD-CM diagnosis code on the anchor inpatient
claim and price MS-DRG without major complication or comorbidity (232,
234, or 236).
Without AMI ICD-CM diagnosis code on the anchor inpatient
claim and price MS-DRG with major complication or comorbidity (231,
233, or 235).
Without AMI ICD-CM diagnosis code on the anchor inpatient
claim and price MS-DRG without major complication or comorbidity (232,
234, or 236).
Fourth, for AMI model episodes with price MS-DRG 231-236, we
proposed to apply ceilings separately to the payments that occurred
during the chained anchor hospitalization and to the payments that
occurred after the chained anchor hospitalization. For the anchor
hospitalization portion of the episode, we proposed to apply the
regional level ceiling calculated for the anchor hospitalization
portion of a CABG model episode for the corresponding price MS-DRG, as
described previously. For the post-anchor hospitalization portion of
the episode, we proposed to apply the regional level ceiling calculated
for the post-anchor hospitalization portion of a CABG model episode for
the corresponding price MS-DRG with AMI diagnosis.
Fifth, for AMI model episodes with price MS-DRG 280-282 or 246-251
and with readmission for CABG MS-DRGs, we proposed to apply the ceiling
separately to the payments during the CABG readmission and all other
payments during the episode. For payments during the CABG readmission
portion of the AMI model episode we proposed to apply the regional
level ceiling calculated for the anchor hospitalization portion of a
CABG model episode for the corresponding CABG readmission MS-DRG, as
described previously. For all other payments during the AMI model
episode, we proposed to apply the regional level ceiling calculated for
AMI model episodes with price MS-DRG 280-282 or 246-251 and without
readmission for CABG MS-DRGs corresponding to the AMI price MS-DRG.
We believed that the proposed ceiling would protect EPM
participants from variable repayment risk for especially-high payment
EPM episodes where the clinical scenarios for these cases each year may
differ significantly and unpredictably.
The proposal for capping high payment EPM episodes were included in
Sec. 512.300(e)(1). We sought comment on our proposal to cap high
payment EPM episodes.
The following is a summary of the comments received and our
responses.
Comment: Commenters supported the proposal for capping high payment
episodes. A commenter noted that the proposal does not separately
address an episode where Medicare accepts a beneficiary's appeal of
Medicare Provider Non-Coverage after the discharging physician
determined not to certify that patient for care. The commenter noted
that under such a scenario, in contradiction with the hospital's
clinical judgment on appropriate level of care, the proposed policy
would not cap spending unless it reached the proposed threshold. The
commenter recommended that CMS create additional flexibilities or
protections for hospitals where a Medicare appeal overturns a
hospital's decision that is based on clinically-directed, evidence-
based discharge criteria.
Response: We appreciate comments in support of our proposal to cap
high payment EPM episodes. We disagree with the suggestion to include
protections in addition to what we have proposed to address scenarios
where a Medicare appeal contradicting a hospital's discharge decision
increases the costs of an episode. We believe our proposal offers
sufficient protection under such circumstances. Further, if a
hospital's discharge decision was overturned upon appeal, we would have
to believe the final decision was correct and any additional costs that
resulted from the appeal would be appropriately included as an episode
cost.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, with modification, to cap
high payment EPM episodes. Specifically, we are not finalizing our
proposal to apply ceilings separately to the payments that occurred
during the chained anchor hospitalization and to the payments that
occurred after the chained anchor hospitalization with respect to AMI
model episodes with MS-DRG 231-236, and instead will simply apply
ceilings separately for each MS-DRG at the regional level as we would
with MS-DRGs 280-282 or 246-251 without readmission for CABG MS-DRGs.
Our final policy for capping high payment EPM episodes is included in
Sec. 512.300(e)(1).
e. Treatment of Reconciliation Payments and Medicare Repayments When
Calculating Historical EPM-Episode Payments To Update EPM-Episode
Benchmark and Quality-Adjusted Target Prices
For the CJR model, we exclude CJR model reconciliation payments and
Medicare repayments from the expenditure data used to update historical
claims when calculating CJR model target prices, although we received
comments on the proposed rule encouraging us to include these payments.
For example, commenters supported their inclusion because CJR-
participating hospitals otherwise would be providing care coordination
services that would not be paid directly or accounted for under
applicable Medicare FFS payments systems and thus might be funded
through reconciliation payments. Further, by
[[Page 299]]
excluding reconciliation payments from the calculations, commenters
suggested that we may underestimate their actual resource costs when
updating target prices for the care necessary during episodes. The CJR
Final Rule discussed our view that including reconciliation payments
would have the effect of Medicare paying CJR model participant
hospitals their target prices, regardless of whether such participant
was below, above, or met their episode target price. We also noted that
we had not discussed any alternatives in the CJR model proposed rule,
and that we might consider including these payments in updating
historical claims through future rulemaking (80 FR 73332).
After further consideration, we proposed to include both
reconciliation payments and Medicare repayments when calculating
historical EPM-episode payments to update EPM-episode benchmark and
quality-adjusted target prices (81 FR 50847). We concurred with the
views expressed by commenters on the CJR model proposed rule that
including these payments would more fully recognize the total resource
costs of care under an EPM than would their exclusion. As indicated in
section V.B. of the proposed rule (81 FR 50950 through 50951), we also
proposed to modify our policy for the CJR model to also include
reconciliation payments and Medicare repayments when updating target
prices under that model. We also considered an option where we would
include only reconciliation payments when updating but not Medicare
repayments; however, we believed this option would not achieve our
intention of more fully capturing the costs of care under the EPM. We
further noted that the inclusion of both reconciliation payments and
Medicare repayments could have differential effects on an EPM
participant's benchmark and quality-adjusted target prices based on
whether or not it received a reconciliation payment or made a Medicare
repayment. For example, all else equal, including an EPM reconciliation
payment when updating an EPM participant's EPM-episode benchmark and
quality-adjusted target prices would modestly increase the quality-
adjusted target prices in performance years 3 through 5 in comparison
to not including the reconciliation payment. Conversely, all else
equal, including a Medicare repayment when updating an EPM
participant's EPM-episode benchmark and quality-adjusted target prices
would reduce the next performance year's quality-adjusted target price
in comparison to not including the Medicare repayment. Following
analogous logic, we also proposed to include BPCI Net Payment
Reconciliation Amounts in our calculations when updating EPM-episode
benchmark and quality-adjusted target prices. We noted, however, that
the effects of these proposals would largely be confined to PY3 of the
EPMs and diminish as EPM-participant historical EPM-episode updates are
eventually determined based on regional payments in subsequent years of
the EPMs. This is because the net sum of EPM reconciliation payments,
Medicare repayments, and BPCI Net Payment Reconciliation Amounts would
represent a small portion of the total historical EPM-episode payments
captured in regional pricing.
When updating EPM-episode benchmark and quality adjusted target
prices for CABG model episodes, we proposed to apportion EPM
reconciliation payments and BPCI Net Reconciliation Payment Amounts
proportionally to the anchor hospitalization and post-anchor
hospitalization portions of CABG model historical episodes. We also
proposed to calculate the proportions based on regional average
historical episode payments that occurred during the anchor
hospitalization portion of CABG model episodes and regional average
historical episode payments that occurred during the post-anchor anchor
hospitalization portion of CABG model episodes that were initiated
during the 3 historical years. This aligns with the general proposal to
calculate the CABG model-episode benchmark price as the sum of the
corresponding CABG anchor hospitalization benchmark price and the
corresponding CABG post-anchor hospitalization benchmark price, as
discussed in III.D.4.b.(2)(ii) and III.D.4.d. of the proposed rule.
The proposal to include both reconciliation payments and Medicare
repayments when calculating historical EPM-episode payments to update
EPM-episode benchmark and quality-adjusted target prices was included
in Sec. 512.300(c)(8). We sought comment on our proposal to include
both reconciliation payments and Medicare repayments when calculating
historical EPM-episode payments to update EPM-episode benchmark and
quality-adjusted target prices.
The following is a summary of the comments received and our
responses.
Comment: Multiple commenters supported the proposal to include
reconciliation payments when calculating target prices in order to more
fully recognize the costs of care under the models. A number of
commenters expressed the view that the proposal will help avoid
participants from constantly competing against their prior success and
better ensure that target prices decrease at a slower rate, which is
critical for those providers that are already efficient, allow more
viable financial targets for the participating providers that are
better aligned with effective patient care. A commenter requested that
CMS include these reconciliation payments and repayments in PY2 rather
than PY3. Another commenter requested that CMS exclude Medicare
repayments given that the targets would fall for hospitals that
increased their spending to improve care, which then caused them to
exceed their target prices.
Response: We appreciate the comments supporting our proposal to
include reconciliation and Medicare repayments when calculating
historical EPM-episode payments to update EPM-episode benchmark and
quality-adjusted target prices. We disagree with comments suggesting
that we accelerate their inclusion to PY2 or to exclude Medicare
repayments for these purposes. We would further note that since the
historical data for determining PY1 and PY2 benchmarks is based on 2013
to 2015 expenditure data, the effects of a reconciliation determination
for PY1, which is based on 2017 expenditure data, would not pertain to
the data used to determine target prices for PY2. Moreover, given that
reconciliation determinations are made 2 months after the completion of
a performance year, it would not be possible to apply the PY1
reconciliation results to the PY2 benchmark data even if we were to
adjust our timeframe for determining historical payments.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
include both reconciliation payments and Medicare repayments when
calculating historical EPM-episode payments to update EPM-episode
benchmark and quality-adjusted target prices. The final policy for
including reconciliation payments and Medicare repayments is included
in Sec. 512.300(c)(8).
4. EPM-Episode Price-Setting Methodologies
a. Overview
Whether an EPM participant receives a reconciliation payment or is
made responsible to repay Medicare under the EPM is based on the EPM
participant's actual EPM-episode payments relative to quality-adjusted
target prices, as well
[[Page 300]]
as the EPM participant's eligibility for reconciliation payment based
on acceptable, good, or excellent quality performance. While our
proposals for relating EPM participant quality performance to EPM
payments were further discussed in section III.E.3.f of the proposed
rule (81 FR 50887 through 50893), this section of the proposed rule
discussed the approach to establishing EPM-episode benchmark and
quality-adjusted target prices (81 FR 50847 through 50864).
For the purposes of price-setting, any references in our proposed
rule to AMI ICD-CM diagnosis codes meant those ICD-9-CM and ICD-10-CM
diagnosis codes for historical EPM episodes or ICD-10-CM diagnosis
codes for EPM episodes during the EPM performance years that can be
found in the specific EPM episode definitions parameters spreadsheet.
Also, for the purposes of price-setting, any references in the proposed
rule to intracardiac ICD-CM procedure codes meant those ICD-9-CM
procedure codes for historical EPM episodes that can be found in the
specific EPM episode definitions parameters spreadsheet. The EPM
episode definitions parameters spreadsheets are posted on the CMS Web
site at https://innovation.cms.gov/inititatives/epm.
We proposed to establish EPM-episode benchmark and quality-adjusted
target prices for each EPM participant based on the following MS-DRGs
and diagnoses included in the AMI, CABG, and SHFFT models as discussed
in sections III.C.3 and III.C.4. of the proposed rule:
(1) AMI model
AMI MS-DRGs --
++ 280 (Acute myocardial infarction, discharged alive with MCC);
++ 281 (Acute myocardial infarction, discharged alive with CC);
++ 282 (Acute myocardial infarction, discharged alive without CC/
MCC); and
PCI MS-DRGs, when the claim includes an AMI ICD-CM
diagnosis code in the principal or secondary position on the inpatient
claim and when the claim does not include an intracardiac ICD-CM
procedure code in any position on the inpatient claim--
++ 246 (Perc cardiovasc proc with drug-eluting stent with MCC or 4+
vessels/stents);
++ 247 (Perc cardiovasc proc with drug-eluting stent without MCC);
++ 248 (Perc cardiovasc proc with non-drug-eluting stent with MCC
or 4+ vessels/stents);
++ 249 (Perc cardiovasc proc with non-drug-eluting stent without
MCC);
++ 250 (Perc cardiovasc proc without coronary artery stent with
MCC); and
++ 251 (Perc cardiovasc proc without coronary artery stent without
MCC).
(2) CABG model DRGs--
231 (Coronary bypass with PTCA with MCC);
232 (Coronary bypass with PTCA without MCC);
233 (Coronary bypass with cardiac cath with MCC);
234 (Coronary bypass with cardiac cath without MCC);
235 (Coronary bypass without cardiac cath with MCC); and
236 (Coronary bypass without cardiac cath without MCC).
(3) SHFFT model DRGs--
480 (Hip and femur procedures except major joint with
MCC);
481 (Hip and femur procedures except major joint with CC);
and
482 (Hip and femur procedures except major joint without
CC or MCC).
We proposed to generally apply the CJR model methodology to set
EPM-episode benchmark and quality-adjusted target prices (80 FR 73337
through 73338), with the addition of some adjustments based on the
specific clinical conditions and care patterns for EPM episodes
included in the AMI, CABG, and SHFFT models. The price-setting
methodology incorporated the following features:
Set different EPM benchmark and quality-adjusted target
prices for EPM episodes based on the assigned price MS-DRG in one of
the included MS-DRGs to account for patient and clinical variations
that impact EPM participants' costs of providing care. Inpatient claims
with PCI MS-DRGs 246-251 that contain an intracardiac ICD-CM procedure
code in any position would not anchor an historical episode, nor be
considered when assigning a price MS-DRG. This is because beginning in
FY 2016, inpatient claims containing an intracardiac ICD-10-CM
procedure code in any position no longer map to MS-DRGs 246-251.
Adjust EPM benchmark and quality-adjusted target prices
for certain EPM episodes involving chained anchor hospitalizations,
specific readmissions, or the presence of an AMI ICD-CM diagnosis code
for CABG MS-DRGs.
Use 3 years of historical Medicare FFS payment data
grouped into EPM episodes according to the EPM episode definitions in
sections III.C.3 and III.C.4. of the proposed rule, termed historical
EPM episodes and historical EPM-episode payments. The specific set of 3
historical years would be updated every other performance year.
Apply Medicare payment system (for example, IPPS, OPPS,
IRF PPS, SNF, MPFS.) updates to the historical EPM-episode data to
ensure we incentivize EPM participants based on historical utilization
and practice patterns, not Medicare payment system rate changes that
are beyond such participants' control. Because different Medicare
payment system updates become effective at two different times of the
year, we would calculate one set of EPM-benchmark and quality-adjusted
target prices for EPM episodes initiated between January 1 and
September 30 and another set for EPM episodes initiated between October
1 and December 31.
Blend together EPM-participant hospital-specific and
regional historical EPM-episode payments, transitioning from primarily
hospital-specific to completely regional pricing over the course of the
5 performance years, to incentivize both historically-efficient and
less-efficient EPM participants to furnish high quality, efficient care
in all years of the EPM Regions would be defined as each of the nine
U.S. Census divisions.
Normalize for hospital-specific wage-adjustment variations
in Medicare payment systems when combining hospital-specific and
regional historical EPM episodes.
Pool together EPM episodes by groups of price MS-DRGs to
allow a greater volume of historical cases and allow us to set more
stable prices.
Apply an effective discount factor on EPM-episode
benchmark prices to serve as Medicare's portion of reduced expenditures
from the EPM episode, with any remaining portion of reduced Medicare
spending below the quality-adjusted target price potentially available
as reconciliation payments to the EPM participant where the anchor
hospitalization occurred.
Further discussion on each of the features and sequential
steps to calculate EPM-episode benchmark and quality-adjusted target
prices can be found in sections III.D.4.b through e. of both our
proposed rule and this final rule.
We also proposed to calculate and communicate EPM-episode benchmark
and quality-adjusted target prices to EPM participants prior to the
performance period in which the prices apply (that is, prior to January
1, 2018, for prices covering EPM episodes that start between January 1,
2018, and September 30, 2018; prior to October 1, 2018, for prices
covering EPM episodes that start between October 1, 2018, and December
31, 2018). We stated our belief that prospectively communicating
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EPM-episode benchmark and quality-adjusted target prices to EPM
participants would help them make infrastructure, care coordination and
delivery, and financial refinements they may deem appropriate to
prepare for the new episode target prices under the model.
The proposal to prospectively communicate quality-adjusted target
prices was included in Sec. 512.300(c)(9). We sought comment on our
proposal to prospectively communicate these prices.
The following is a summary of the comments received and our
responses.
Comment: Commenters supported the proposal to establish and
prospectively communicate benchmark and quality-adjusted target prices.
Commenters also expressed concerns about how far in advance the
information would be made available and the level of detail that would
be included in the information. Commenters indicated that knowing the
target price prior to the relevant performance period is essential for
participants to be able to implement efficient care redesigns linked
explicitly to established payment rates. As such, commenters requested
that CMS provide this information 60 to 90 days prior to the start of
the relevant performance period. Other commenters requested that CMS
make all of the components necessary to calculate the target price for
both the CJR model and proposed EPMs available to participants so they
can verify that CMS accurately calculated the target price as some CJR
participants have reported an inability to replicate the target price
calculation due to CMS' use of ``black box'' inputs for certain
national factors.
Response: We appreciate the comments and support we received for
our proposal to prospectively communicate benchmark and quality-
adjusted target prices, agree with commenters on the importance of
having this information in advance of each performance year, and intend
to make as much information available as we deem appropriate to
participants as far in advance of the models' implementation as is
possible.
Comment: Several commenters recommended that CMS annually
reevaluate and update the price-setting assumptions through a notice
and comment process. One of these commenters reported that the proposal
to make historical claims data available before implementation of the
models would still not give hospitals an opportunity to comment on
problems with the methodology until after the models had begun. Another
commenter based their request on significant and unexplained changes in
prices reported under BPCI and the Pioneer ACO model.
Response: We appreciate these comments and suggestions. We believe
the information we provided in both our proposed and this final rule is
sufficiently detailed for participants to understand our assumptions
and methodology for setting target prices. In the event we intend to
materially change our price-setting assumptions or methodology, we
would make those proposed changes available through a notice and
comment process.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
prospectively communicate quality-adjusted target prices.
b. EPM-Episode Benchmark and Quality-Adjusted Target Price Features
(1) Risk-Stratifying EPM-Episode Benchmark Prices Based on MS-DRG and
Diagnosis
To account for some of the clinical and resource variations that
would be expected to occur under the EPMs, we proposed generally to
apply the episode pricing methodology that was applied to the CJR model
to develop the EPM-episode benchmark prices, which we referred to as
the standard EPM-episode benchmark price (81 FR 50848). In addition,
for each EPM participant, we proposed to risk-stratify and establish
special EPM-episode benchmark prices for episodes in different pricing
scenarios as described in this section, as well as sections III.D.4.c.
through e. of the proposed rule (81 FR 50848 through 50864). For
purposes of the proposed rule, risk-stratification meant the
methodology for developing the EPM-episode benchmark price that
accounts for clinical and resource variation in historical EPM episodes
so that the quality-adjusted target price (calculated from the EPM-
episode benchmark price) can be compared to actual EPM episode payments
for EPM beneficiaries with similar care needs to those in historical
EPM episodes.
For the SHFFT model, we proposed to set the price MS-DRG equal to
the anchor MS-DRG. We proposed to calculate standard SHFFT model-
episode benchmark prices based on price MS-DRGs following the general
payment methodology that was applied to the CJR model (80 FR 73337
through 73358) with risk stratification according to the anchor MS-DRG.
Similarly, for AMI model episodes without chained anchor
hospitalizations and without readmissions for CABG MS-DRGs, we proposed
to set the price MS-DRG equal to the anchor MS-DRG. We proposed to
calculate standard AMI model-episode benchmark prices based on price
MS-DRGs following the general payment methodology that was applied to
the CJR model (80 FR 73337 through 73358) with risk stratification
according to the anchor MS-DRG. We proposed to apply the CJR model
payment methodology separately to AMI model episodes with anchor AMI
MS-DRGs 280 through 282 and anchor PCI MS-DRGs 246 through 251 with a
corresponding AMI ICD-CM diagnosis code on the inpatient claim for the
anchor hospitalization and without an intracardiac ICD-CM procedure
code in any position on the inpatient claim for the anchor
hospitalization.
For episodes in the AMI model with chained anchor hospitalizations
and no readmissions for CABG MS-DRGs, we proposed to set the price MS-
DRG based on the hierarchy described in section III.D.4.b.(2)(a) and to
calculate AMI model-episode benchmark prices based on price MS-DRGs as
described in sections III.D.4.b.(2)(a) and III.D.4.c. of the proposed
rule.
For AMI model episodes without chained anchor hospitalizations and
with readmissions for CABG MS-DRGs, we proposed to set the price MS-DRG
as the anchor MS-DRG and to calculate CABG readmission AMI model-
episode benchmark prices as described in sections III.D.4.b.(2)(b),
III.D.4.b.(2)(c), and III.D.4.e of the proposed rule.
For AMI model episodes with chained anchor hospitalizations that do
not include CABG MS-DRGs and with readmissions for CABG MS-DRGs, we
proposed to set the price MS-DRG based on the hierarchy described in
section III.D.4.b.(2)(a) and to calculate CABG readmission AMI model-
episode benchmark prices as described in sections III.D.4.b.(2)(b),
III.D.4.b.(2)(c), and III.D.4.e. of the proposed rule.
For CABG model episodes, we proposed to set the price MS-DRG as the
anchor MS-DRG and to calculate CABG model-episode benchmark prices as
the sum of the CABG anchor hospitalization portion price and the CABG
post-anchor hospitalization portion price, which would be calculated by
applying the general payment methodology that was applied to the CJR
model (80 FR 73337 through 73358) separately to the expenditures that
occurred during the anchor hospitalization of the CABG model episode
and to the expenditures that occurred after the anchor hospitalization
as discussed in sections III.D.4.b.(2)(b) and III.D.4.d. of the
proposed rule.
[[Page 302]]
Finally, we proposed that after assigning an EPM-episode benchmark
price to each EPM episode, the EPM-episode quality-adjusted target
price would be the EPM-episode benchmark price reduced by the effective
discount factor for the corresponding EPM that corresponds to the EPM
participant's quality category, as discussed in sections III.D.4.b.(10)
and III.E.3.f. of the proposed rule.
The following is a summary of the comments received and our
responses.
Comment: One commenter commended CMS for attempting to create a
target price methodology that accounts for the variations in episode
spending that are characteristic of these specific clinical scenarios
while other commenters noted that the complexity of the proposals made
it difficult to evaluate them. Several commenters disagreed with the
proposal to base prices on MS-DRGs or anticipated that they could
result in unintended consequences. For example, commenters noted
concerns that it would be challenging to generate sufficient savings
where a sizeable portion of episode costs are embedded in the MS-DRG
costs attributed to the initial hospitalization and cannot be changed
by hospitals' performance. Other commenters noted that the higher
payments associated with higher-weighted MS-DRGs could serve as a
disincentive to participants from making quality improvements or to
reduce complications because they would be paid more when there are
complications that raise the MS-DRG, but paid less when quality
improvements they made resulted in a lower cost MS-DRG where only CMS
rather than the hospital benefitted from the reduced costs. Likewise,
several commenters claimed that participant coding behavior could
result in similar unintended consequences. As such, several commenters
recommended that CMS consider a price-setting methodology that removes
the MS-DRG payment from the target price or mitigates coding effects
from the calculations or differentially weights cost components that
would be ``locked in'' to the episode spending.
Response: The purpose of our models is to test EPMs within the
existing parameters and payment systems of FFS Medicare. As we noted in
section III.A.1.c. of this final rule, issues such as those commenters
raised are generally present for every episode payment model that sets
a price Medicare will pay for an episode-of-care. While our models are
not intended to change these existing FFS payment systems, we intend
that by incorporating both the MS-DRG payment and Part B services
furnished during the anchor inpatient hospitalization, the EPMs will
create incentives for increased care coordination and efficient care
delivery from the time of inpatient admission through 90 days after
discharge. Moreover, we hope the EPMs can identify the effectiveness of
a bundled payment model within those parameters as well as the factors
that could impede success. As discussed further in sections III.G.4.
through III.G.6. of this final rule, we will monitor access to care,
the quality of care, and delayed care under the EPMs and may take
actions against EPM participants if we find evidence that supports
concerns in these areas. In addition, the evaluation as discussed in
section IV. of this final rule will analyze beneficiary outcomes and
their relationship to clinical pathways under the EPMs.
Comment: Several commenters addressed EPM payments under the SHFFT
model. One commenter noted that the proposed SHFFT model would include
beneficiaries discharged under hip and femur procedures except major
joint replacement MS-DRGs (480-482), representing IPPS admissions for
hip fixation procedures in the setting of hip fractures. As these
procedures are emergent rather than elective, they would have more risk
to manage than would an elective LEJR and would more often require a
SNF stay and non-weight bearing status for weeks, which results in
higher costs than for an elective procedure. The commenter questioned
whether such non-elective procedures would have a higher benchmark
price and expressed concerns that bundled payment models are
potentially less successful for non-elective procedures which they
believe require more time for planning and rehabilitation.
Other commenters suggested that the differences in severity and
fracture type for episodes under the SHFFT model are not adequately
represented by the three MS-DRGs we proposed. One of these commenters
requested additional separate target prices as CMS had done for the CJR
model, which would serve as a rough form of risk-adjustment and would
make it easier for hospitals to devise protocols and strategies best
suited to fracture type. Another commenter suggested that since
patients who experience SHFFT episodes often require lengthier and more
complicated care, and typically require longer post-acute care than
those receiving joint replacement, the calculation of target prices
should also take into account the proportion of SHFFT episodes included
in the bundle in order to most accurately capture the risk of SHFFT
episodes. One commenter recommended that CMS adopt transfer mechanisms
within the SHFFT model, including price adjustments, which are similar
to those proposed for inpatient-to-inpatient hospital transfers under
the AMI model but that the receiving hospital would bear the risk if a
SHFFT patient is transferred to that hospital.
Response: We proposed to set prices based on anchor MS-DRGs, which
implicitly adjust payments based on their relative weights with respect
to the IPPS resources required for that MS-DRG. For example, average
episode expenditures for historical SHFFT episodes increases from
roughly $36,000 in episodes with anchor MS-DRG 482 to more than $52,000
for episodes with anchor MS-DRG 480.\77\ Further, our benchmark prices
would reflect the historic costs of post-acute care associated with
these MS-DRGs. If historic post-acute care costs for the emergent MS-
DRG are higher than those for a similar elective MS-DRG, then those
higher resources would be reflected in and produce a larger increase in
the benchmark amount than would be the case for the elective procedure.
We would also note that as discussed in section III.D.4.b.(2) which
follows, we will be exploring additional options to adjust benchmark
prices and performance payments to better account for cost variation
associated with risk. These adjustments, which we intend to be
effective beginning in PY3, should further account for some of the
potential variation in costs across episodes as has been highlighted.
We disagree with the view that a bundled payment would be any less
effective with an emergent than an elective procedure. Our proposed
models are intended to encourage changes and improvements in
participants' care practices, in general, with respect to the episodes
covered under the models, which we believe would apply regardless of
whether the episode is elective or emergent.
---------------------------------------------------------------------------
\77\ Episodes for SHFFT model beneficiaries initiated by all
U.S. IPPS hospitals and constructed using standardized Medicare FFS
Parts A and B claims, as proposed in this rule that began in CYs
2012-2014.
---------------------------------------------------------------------------
As discussed in section III.D.4.b.2.(a), we are not finalizing our
proposal with regard to inpatient-to-inpatient transfers for AMI
episodes. For AMI model episodes alone, we will cancel the AMI episode
that begins at the initial treating hospital when an inpatient-to-
inpatient transfer occurs during the anchor hospitalization. For CABG
and SHFFT model episodes, once the episode begins and an inpatient-to-
inpatient transfer occurs, the episode will continue and
[[Page 303]]
the hospitalization at the transfer hospital will be included or
excluded from the CABG or SHFFFT episode based on whether or not the
MS-DRG for the admission at the transfer hospital is excluded from the
CABG or SHFFT episode definition.
Comment: One commenter stated that the proposed EPMs do not
adequately account for research and teaching functions and that CMS
should adjust payments to account for the overhead associated with
these functions.
Response: We disagree that our proposed models should include
additional payment adjustments for research and teaching function
beyond the payments Medicare already makes for these purposes under the
IPPS. In contrast, we believe that participants should seek improved
care quality and efficiencies as broadly as is possible, including any
that can be attained with research or teaching activities.
Comment: A commenter noted their view that all providers should
have EHR capability, including the ability to share EHR data across
sites of service in order to speed decision-making and eliminate
duplication of effort. The commenter suggested that CMS include
incentive funds to assist post-acute care providers in implementing a
robust EHR system and tools to share the data with other providers.
Similarly, a commenter suggested that the proposed models will require
technology and services for monitoring care during a post-acute care
stay, and that CMS should incentivize the use of such technology and
services. The commenter recommended that CMS should pay for remote
patient monitoring using the CPT-code 94040, which is similar to what
is done in certain state models.
Response: We agree that EHR capability and monitoring technologies
can be useful tools toward improving care coordination and care
quality; however, our models are based on incentives to improve care
quality and efficiency, with a goal of improving control of cost
growth. We do not believe that adding funding to encourage further
adoption of technologies under the models is consistent with our goals.
However, we would note that to the extent a participant establishes
sharing arrangements with post-acute care collaborators under the
models, those collaborators could choose to use such shared funds for
purposes of improving their EHR or monitoring capacities.
Comment: As discussed in section III.C.3.b. of this final rule, one
commenter pointed to evidence demonstrating that the use of drug-
eluting stents (DESs) results in better long-term outcomes in many
patients and fewer repeat procedures for in-stent restenosis than do
less costly non-drug eluting stents. The commenter expressed concern
that while the costs of these more expensive stents would be captured
in the episode cost calculation, the long-term benefit for patients
both in terms of outcomes and costs would not be fully captured in the
90-day post-discharge episode period and hence discourage the
appropriate use of DES by causing fewer patients to receive them,
resulting in poorer outcomes and increased cost growth. The commenter
requested that CMS consider various means so to ensure the 90-day post-
discharge episode target price does not discourage the longer term
outcomes that are better for Medicare beneficiaries and potentially
overall savings for CMS. Another commenter requested an adjustment or
additional financial protection for costs associated with the
implantation of an Implantable Cardioverter Defibrillator (ICD) given
strong empirical support and its Class I recommendation for prevention
of sudden cardiac death for certain patients.
Similarly, another commenter recommended that CMS include a payment
adjustment such as an additional outlier or add-on payment for using
new technology, having higher cost cases, or adopting a breakthrough/
high cost treatment in advance of other providers.
Finally, one commenter recommended that CMS coordinate with the
device industry to create a process wherein the use and associated cost
of new technologies can be added to episodes of care definitions on a
routine basis and modify the proposal to ensure that providers have
financial incentives to provide optimal care for high-risk patients
with severe coronary artery disease even if the initial treatment
episode has a higher cost. The commenter expressed concern that
insufficient data were available at this time to inform a clinical
guideline recommendation with regard to the optimal timing of non-
culprit vessel PCI, and the proposed payment bundles could encourage
procedures that may not provide the best clinical outcomes for Medicare
beneficiaries but instead have financial benefits with respect to the
target price. As guidelines change based on available data, CMS should
consider potential adjustments to reconciliation to the episodes
quality adjusted target prices based on guideline changes.
Response: As we noted in section III.C.3.b. of this final rule,
Medicare payment for coronary stents, whether bare metal or DES, used
during a PCI performed during a hospitalization are included in the
IPPS payment for the inpatient hospitalization. While they are not paid
separately by Medicare, payment for the required resources would be
included in AMI episodes because the IPPS services for the anchor
hospitalization are included in the episodes. We propose to risk-
stratify EPM-episode prices based on MS-DRG as discussed in section
III.D.4.b.(1) of this final rule and there are separate MS-DRGs for
PCIs that use DES (246 and 247) and non-DES (248 and 249) for which
there would be separate AMI episode prices. Therefore, we do not
believe that the financial incentives under the AMI model encourage the
use of any specific coronary stent because the episode prices take into
consideration the IPPS payment for the specific MS-DRG that applies to
the AMI model beneficiary. We do not expect the AMI model to discourage
the appropriate use of DES. We would also note, as stated in section
III.D.4.b.(2), we will be exploring additional mechanisms to risk
adjust payments that should become available beginning in PY3. We
believe that these adjustments will provide participants further
protections that should help mitigate the concerns commenters raised.
Likewise, we do not agree with comments requesting payments in
addition to those currently made available when participants adopt
specific or new technologies, provide services for high-cost cases, or
adopt breakthrough technologies. The purposes of the proposed models
are to improve care quality and efficiency while better controlling
Medicare cost growth within a FFS framework. As such, the models seek
to achieve these goals to the greatest extent possible within the
regulatory framework that applies within FFS Medicare, and are not
intended to create new or substitute payment mechanisms or processes
for establishing new payments under FFS Medicare.
Comment: A commenter recommended that when establishing episode
target payments, price calculations should incorporate clinical
practice guidelines and appropriate use criteria that are endorsed by
all stakeholders to ensure that patients are not receiving inadequate
care.
Response: We disagree with the recommendation that prices should
include clinical practice guidelines as, to the contrary, they are
based on Medicare FFS payments and their historical utilization for
services included in the EPMs, and should not
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include specifications reflecting normative criteria regarding clinical
practice guidelines, which could be overly prescriptive for EPM
participants and provides and suppliers treating EPM beneficiaries.
That said, we would assume that EPM participants would be following
clinical practice guidelines as we would expect should also be the case
for services and paid under the Medicare FFS program.
Comment: We received a comment suggesting that CMS make payment
adjustments for cases where a beneficiary receives the majority of
their post-acute care in a different MSA from the MSA in which the
anchor hospitalization occurred. The commenter presented an example
where a beneficiary with an anchor hospitalization in Massachusetts
receives post-acute care in Florida. In their view, the MSA in Florida
could have higher service utilization and spending than the
Massachusetts MSA given different care practices. Further, the
commenter believed it was unlikely that the hospital in Massachusetts
could have influence on a provider in another distant MSA. The
commenter recommended a payment adjustment to both avoid penalizing
hospitals in the initiating MSA and to help in not deterring tertiary
care facilities from accepting patients that could not receive
necessary care in their own distant MSA.
Response: As noted in section III.C.4.a. of this final rule, we
recognize that in occasional circumstances, EPM participants may have
limited ability to coordinate care, but that we generally expect that
much of the subsequent coordination of post-acute care services and
other related services for EPM beneficiaries during the 90 days post-
discharge can be accomplished through telecommunications that do not
require the patient to remain within the geographic proximity of the
hospital responsible for the EPM episode. In that section, we also
noted that the design of the EPMs does not preclude hospitals from
coordinating care with other providers outside of their immediate
service area, that most EPM participants have the tools to engage in
effective remote care coordination that results in high quality episode
care, and that we finalized several waivers of Medicare program rules,
as discussed in section III.J. of this final rule, to facilitate
efficient and effective episode care coordination for beneficiaries in
remote or distant locations outside of the EPM participant's immediate
community. We also finalized policies for financial arrangements in
section III.I. of this final rule that allow EPM participants to share
upside and downside financial risk with a variety of individuals and
entities who collaborate with the EPM participant in redesigning care
and caring for EPM beneficiaries, regardless of the geographic
proximity of these individuals and entities to the EPM participant.
Through financial arrangements, EPM participants could align the
financial incentives of providers in the EPM beneficiary's home
community with the goals of the EPM participant to improve the quality
and reduce the cost of EPM episodes. Therefore, we do not believe it is
necessary to make a payment adjustment when a beneficiary receives
post-acute care in a different MSA from the MSA in which the anchor
hospitalization occurred. However, we plan to monitor these occurrences
and could consider modifying our policy should that be determined
appropriate.
Comment: Several commenters requested that CMS include more
flexibility with respect to payments for post-acute care services under
the models. For example, some commenters noted that while Medicare
payments for inpatient rehabilitation facility or long-term care
hospital services are based on a prospective amount, payments for
skilled nursing facility services are less ``encompassing'' and are
based on a per diem amount. Commenters suggested that these differences
can create an unequal playing field and prevent efficiencies that are
realized from being reflected in payments. As such, commenters
requested that CMS identify flexibilities so that payments among a
broader array of post-acute care providers could more closely reflect
any efficiencies that are realized, for example, through payments on a
per diem basis or at a reduced rate.
Response: We appreciate the suggestions commenters offered to
better align payments across post-acute care providers. We will not be
adopting these suggestions for purposes of these models as, to the
greatest extent possible, we want to test the effects of bundled
payments within the existing FFS Medicare framework. We will consider
the applicability of the suggestions offered, however, as we explore
future models that involve payments for post-acute care services.
(2) Adjustments To Account for EPM-Episode Price Variation
We also considered further adjustments to account for clinical and
resource variation that could affect EPM participants' costs for EPM
episodes. As was the case for the CJR model (80 FR 73338 through
73339), we stated our belief that no standard risk adjustment approach
that is widely-accepted throughout the nation exists for the proposed
EPM episodes. Thus, we did not propose to make risk adjustments based
on beneficiary-specific demographic characteristics or clinical
indicators. Likewise, we questioned whether CMS Hierarchical Condition
Categories (HCC) used to adjust for risk in the Medicare Advantage
program would be appropriate for risk-adjusting EPM episodes as such
categories are used to predict total Medicare expenditures in an
upcoming year for MA plans and may not be appropriate for use in
predicting expenditures over a shorter period of time, such as the EPM
episodes. Further, the validity of HCC scores for predicting Medicare
expenditures for shorter episodes-of-care or specifically for the AMI,
CABG, and SHFFT model episodes that we are proposing has not been
determined. Thus, we did not propose to risk-adjust EPM-episode
benchmark or quality-adjusted target prices using HCC scores for the
EPMs. We referred to the CJR Final Rule for additional discussion of
our assessment of risk-adjustment options for the CJR model, which
informed our views on their appropriateness for the EPMs (80 FR 73338
through 73340).
We also noted, however, that there are circumstances that could
account for spending variation in EPM episodes where certain pricing
adjustments could be appropriate. We identified several scenarios where
increased EPM-episode efficiencies would be limited for certain groups
of EPM beneficiaries and a standard EPM-episode benchmark price based
on the anchor MS-DRG would, therefore, not account for circumstances
where clinically-appropriate care could consistently result in higher
EPM-episode payments. For example, as discussed in section
III.C.4.a.(5) of the proposed rule, variation could arise from the
asymmetric distribution of cardiac care across hospitals, which makes
transfers, either from a hospitalization or from the emergency
department (without inpatient admission) of one hospital to another, a
common consideration in the treatment course for beneficiaries with an
initial diagnosis of AMI, resulting in a chained anchor hospitalization
for inpatient-to-inpatient transfers. We also recognized that certain
episodes involving hospital readmissions for clinically-appropriate
planned follow-up care may have higher episode spending than episodes
with a single hospitalization or with chained anchor hospitalizations
involving transfers that do not have any readmissions. Further, a
beneficiary
[[Page 305]]
who has a CABG in the context of hospitalization for an AMI may have
different spending in the 90 days post-hospital-discharge due to
different health needs than a beneficiary who has an elective CABG.
Accordingly, we proposed specific policies and payment adjustments in
recognition of the systematic, consistent variation in EPM-episode
spending that could result from such circumstances.
The following is a summary of the comments received and our
responses.
Comment: While one commenter supported the proposal to risk-
stratify episode costs based largely on MS-DRGs with additional
adjustments for scenarios including chained anchor hospitalizations,
readmissions, and CABG, many commenters expressed concerns that no
further risk-adjustment was proposed beyond the risk-stratification
inherent in the MS-DRGs and CMS' proposed adjustments for such
scenarios as chained anchor hospitalizations or episodes involving
readmissions or CABG. These commenters noted their views that the
absence of further risk-adjustment would penalize hospitals treating
the sickest, most complicated, and most vulnerable patients for factors
that are beyond the hospitals' control. One commenter reported that
adequate risk-adjustment is especially important as CMS considers
additional clinical groups for bundling programs, such as cardiac care
or SHFFT patients, that are more clinically heterogeneous than CJR
patients. MedPAC noted that it has ``consistently found that chronic
conditions and advanced age play a major role in explaining variation
in spending across beneficiaries. CMS proposes no further risk-
adjustments beyond the DRG/subgroups but provides no data to assess
whether the proposed stratification is sufficient to adjust for
differences in spending across beneficiaries within each episode type.
The Commission urges CMS to evaluate whether additional risk adjustment
strategies, such as comorbidities and age, would improve the accuracy
of the benchmarks.''
Many of the commenters pointed to a recent study noting that the
use of region-based target pricing can lead to reduced reconciliation
payments for hospitals.\78\ However, reconciliation payments would
substantially increase for hospitals that treat patients with high
complexity and be reduced for hospitals that treat patients with low
complexity when CMS-HCC scores are applied. Some commenters cited
additional data in support of their views that the absence of risk-
adjustment ignores the substantial variation in episode payments that
exists, penalizes hospitals for assuming the risk of higher-cost/
higher-risk patients, or potentially impedes access to high quality
care.
---------------------------------------------------------------------------
\78\ Ellimoottil C, Ryan AM, Hou H, et al. Medicare's New
Bundled Payment For Joint Replacement May Penalize Hospitals That
Treat Medically Complex Patients. Health Affairs. 2016: 35(9):1651-
1657. doi: 10.1377/hlthaff.2016.0263.
---------------------------------------------------------------------------
A number of commenters related the absence of further risk-
adjustment to concerns with the proposal to phase-in regionally
determined target prices. For example, commenters noted that the use of
a regional spending component will hold all hospitals in a region to
the same target price, even though they would have different clinical
capabilities and different risk profiles that results in their treating
patient populations with differing levels of severity and costs, which
further buttressed the view that substantial variation in episode
payments exist within each target price category, not just between the
target price categories. Some commenters expressed concerns that
differences in clinical capabilities, and therefore, differing rates of
more costly transfer episodes, could penalize smaller hospitals that do
not have the most sophisticated cardiac care available.
Some commenters expressed the view that the absence of risk
adjustment would particularly affect hospitals that typically treat
more complex patients, for example, tertiary hospitals or hospitals
that are academic medical centers because the absence of risk
adjustment would not account for the complexity of their patients,
which often included multiple co-morbidities, longer lengths of stay,
and higher costs. As hospitals could view these patients as increasing
their financial risk under the EPMs, commenters expressed concerns that
patients who suffer from multiple chronic conditions or comorbidities
may find it more difficult to find participating hospitals willing to
serve them.
Other commenters expressed concern that hospitals serving
communities with a high percentage of lower income patients could be
adversely affected by the absence of risk-adjustment. Moreover, the
lack of further risk-adjustment could create a risk-adverse environment
with the possibility of withholding appropriate care to patients with
moderate to high-risk profiles, for example to women, due to their
older age at cardiac presentation and minorities due to increased
frequency of clinical renal disorder. These commenters noted that such
patients could have higher costs due to their age or presence of
multiple co-morbidities. Further, by not providing an adjustment
factor, there could be a greater chance of transfer abuse whereby
smaller providers might shift risk for these patients to tertiary
providers by transferring emergency room patients that are at greater
risk for complications or readmissions.
Commenters also noted that CMS appeared to be inconsistent and
contradictory in not proposing to apply CMS-HCC scores for the proposed
models or for the CJR model when it does so for similar programs and
applications. Specifically, commenters observed that CMS-HCC scores are
applied to quality measures such as Medicare Spending per Beneficiary
(MSPB), 30-day mortality and readmission, as well as for the quality
measures proposed to be included under the proposed models. Commenters
remarked that this gives the impression of poor harmonization of
efforts within CMS, which leads to fragmented programs.
Thus, the commenters requested that CMS apply some kind of
additional risk-adjustment to the proposed models and the CJR model at
the latest before downside risk begins. One commenter noted that even
if not ideal, further risk-adjustment would be at least as good as CMS'
proposal, but simpler and easier to understand than the 75 different
target prices CMS proposed. Other commenters recommended that CMS
explore and incorporate additional risk- adjustment to address socio-
demographic factors, in addition to clinical factors, to more
accurately reflect the level of risk associated with such beneficiary
characteristics as income and employment status. Further, another
commenter reported that socio-demographic factors such as the
availability of primary care, physical therapy, easy access to
medications and appropriate food, and other supportive services, which
are beyond providers' control, affect hospitals' performance on outcome
measures.
Several commenters recommended that CMS apply the CMS-HCC scores.
In their view, some benefits of these scores is that they capture the
severity of a patient's level of underlying illness, better match
hospital's payment to the complexity of their patients, appropriately
account for the expected increase in utilization of health care
services, reduce the likelihood of a Medicare repayment, and should be
administratively simple to apply given their use for other efforts and
programs under Medicare. One commenter offered that these codes could,
at a minimum, serve as a basis for CMS to begin to construct an
appropriate risk-
[[Page 306]]
adjustment for CJR episodes, as well as for SHFFT episodes if it re-
proposes their implementation in the future. Another commenter
suggested that CMS identify a means to adjust the CMS-HCC codes so that
they could better apply to a 90-day episode. Moreover, while
encouraging further risk-adjustment as soon as possible within the
period of the model, this commenter also suggested that the proposed
models could be an opportunity to obtain the data needed to develop EPM
risk-adjusters.
One commenter encouraged the use of physician-defined patient
condition categories to ensure effective risk stratification in
condition-based payment models. This commenter reported that
alternative payment models that are designed to control overuse need to
incorporate effective risk adjustment or risk stratification components
in order to protect patients against underuse and to avoid penalizing
physicians for delivering and ordering services that patients need. In
their view, CMS-HCCs and other claims-based regression models are not
adequate for risk adjustment in condition-based payment models. Rather,
condition-based payment models must be risk stratified based on the
clinical characteristics and functional status of patients that are
most relevant to the types of conditions being managed.
Some commenters urged CMS to improve the risk-adjustment
methodology by collaborating with the clinical community and relevant
medical specialty societies such as the cardiovascular community that
have experience with the different risks facing patients who will be
treated within these episode models. Other commenters recommended that
CMS review risk adjustment methodologies used by other's bundling
models or to incorporate data from the STS Risk Calculator into the
risk-adjustment methodology or to use multiple model to better predict
the cost of care.
Commenters requested that CMS expand risk-adjustment to other
provider types or measures factors in addition to the patient alone.
For example, one commenter expressed concern that CMS has no risk-
adjustment methodology in place for patients' transitions into the
post-acute and long-term care sector and that many factors contribute
to cost variation in these milieu are outside of the control of the
facilities themselves. The commenter requested CMS to clearly define
risk stratification indices and develop a cost-to-risk algorithm based
on previous utilization data and incorporating specific, patient
characteristics, including functional status, age, and frailty, to
accurately evaluate EPM performance. Another commenter recommended that
CMS examine whether the CMS-HCC model would be an appropriate way to
measure the resource use of geriatricians as well as serve as a risk-
adjustment mechanism. Finally, one commenter urged CMS to modify the
risk-adjustment policy to reflect the relative riskiness of the
procedures as well as the beneficiary-specific demographic
characteristics and clinical indicators.
Response: We appreciate the comment supporting our proposal to
risk-stratify episode costs based largely on MS-DRGs with additional
adjustments for scenarios including chained anchor hospitalizations,
readmissions, and CABG as well as the many comments expressing concerns
about our proposal, data cited in support of these concerns, requests
for additional measures to adjust for risk, and suggestions on
approaches to consider for this purpose. We share commenters' interests
in ensuring that payments under the models are well aligned with costs
and adequately recognize cost variation associated with either the
services provided or beneficiary characteristics so that participants
are encouraged and able to be successful under the models, which
includes providing access to high quality care to Medicare
beneficiaries. In particular, we share commenters' concerns that
episode payments be more closely aligned with costs when all EPM
participants will assume downside risk and have their payments
determined more fully based on regional pricing.
Based on the comments we received, we are persuaded to explore
additional measures with which we could adjust EPM episode payments for
risk to complement our proposals to stratify and adjust episode
payments based on type and combination of anchor MS-DRGs included in an
episode. As such, we plan to examine a range of options such as CMS-HCC
scores, beneficiary factors, clinical factors, pathways including
planned readmissions after discharge for an acute cardiac event, and
other measures that potentially further explain variation in costs,
including socio-demographic factors such availability of primary care
services. As discussed in section III.D.7.c.(2) of this final rule, CMS
will also consider and potentially incorporate results from studies
conducted under the Improving Medicare Post-Acute Care Transformation
``IMPACT'' Act of 2014 (Pub. L. 113-183) with respect to factors,
including socio-demographic factors, that could affect resource use
under Medicare and the EPMs.
While we are optimistic that we will be able to identify factors
that explain more variation in episode expenditures than risk
stratification alone, we acknowledge that no combination of adjustments
will account for all variation in episode expenditures. Still, we
intend to proceed with the models and as discussed elsewhere in this
rule are finalizing other financial protections like an extended period
of no downside risk (see section III.D. 2.c.), capping high payment
episodes (see section III.D.3.d.), and more generous stop-loss
protections for certain hospitals (see III.D.7.c.(1)). We also intend
to engage with and seek input from stakeholders as we examine this
range of options prior to rulemaking.
Our goal is to make our refinements to the pricing methodology to
reflect risk adjustment effective beginning in PY3, which we would
establish based on a notice and comment rulemaking process. As such,
the additional measures would apply to episodes ending on or after
January 1, 2019 and that had anchor discharges occurring after October
1, 2018 and thus be in place at the time downside risk is required.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
risk-stratify episodes based on adjustments to recognize the
combination of MS-DRGs and pathways associated with an episode. We will
also explore and plan to implement additional adjustments to account
for risk through rulemaking to be effective in PY3.
(a) Adjustments for Certain AMI Model Episodes With Chained Anchor
Hospitalizations
In section III.C.4.a.(5) of the proposed rule, we stated that once
an AMI model episode is initiated at an AMI model participant, the AMI
model episode continues under the responsibility of that specific
participant, regardless of whether the beneficiary is transferred to
another hospital for further medical management of AMI or
revascularization through PCI or CABG during a chained anchor
hospitalization. Given there could be significant differences between
the discharge MS-DRG from the hospital that initiates the AMI episode
and the hospital to which a beneficiary is transferred, as well as the
Medicare payment associated with these different MS-DRGs and the post-
discharge spending for these beneficiaries, we stated that it would be
[[Page 307]]
appropriate to adjust the AMI model-episode benchmark prices for
certain AMI model episodes involving a chained anchor hospitalization.
More specifically, we indicated that it would be appropriate to make an
adjustment when a final hospital discharge MS-DRG in the chained anchor
hospitalization is an anchor MS-DRG under either the AMI or CABG model.
Thus, for episodes involving a chained anchor hospitalization with a
final discharge diagnosis of any of AMI MS-DRG 280-282, PCI MS-DRG 246-
251 without an intracardiac ICD-CM procedure code in any position on
the inpatient claim, or CABG MS-DRG 231-236, we proposed to set a
chain-adjusted AMI model-episode benchmark price or ``price MS-DRG''
based on the AMI, PCI, or CABG MS-DRG in the chained anchor admission
with the highest IPPS weight. If a CABG MS-DRG occurred in a chained
anchor hospitalization that was initiated with an AMI MS-DRG or PCI MS-
DRG without an intracardiac ICD-CM procedure code in any position on
the corresponding inpatient claim, we proposed that the AMI model
episode would begin with and be attributed to the first hospital, and
we proposed to set the price MS-DRG to the CABG MS-DRG in the chained
anchor hospitalization with the highest IPPS weight.
If the price MS-DRG was an AMI or PCI MS-DRG, we proposed to set
the episode benchmark price as the standard AMI model-episode benchmark
price for the price MS-DRG, subject to a possible adjustment for
readmission for CABG MS-DRGs, as described in section III.D.4.b.(2)(c)
of the proposed rule. If the price MS-DRG is a CABG MS-DRG, we proposed
to set the AMI model-episode benchmark price as the CABG model-episode
benchmark price for the corresponding CABG MS-DRG, with no further
adjustment in the event of a readmission for CABG MS-DRGs.
Table 13 displays the weights for CABG, PCI, and AMI MS-DRGs
established in the FY 2016 IPPS final rule, which are subject to change
each FY through the annual IPPS rulemaking (80 FR 49325 through 49886).
Table 13--FY 2016 IPPS Weights for MS-DRGS 231-236, 246-251, and 280-282
----------------------------------------------------------------------------------------------------------------
MS-DRG MS-DRG title Weights
----------------------------------------------------------------------------------------------------------------
231........................................... CORONARY BYPASS W PTCA W MCC.................... 7.8056
232........................................... CORONARY BYPASS W PTCA W/O MCC.................. 5.7779
233........................................... CORONARY BYPASS W CARDIAC CATH W MCC............ 7.3581
234........................................... CORONARY BYPASS W CARDIAC CATH W/O MCC.......... 4.9076
235........................................... CORONARY BYPASS W/O CARDIAC CATH W MCC.......... 5.8103
236........................................... CORONARY BYPASS W/O CARDIAC CATH W/O MCC........ 3.8013
246........................................... PERC CARDIOVASC PROC W DRUG-ELUTING STENT W MCC 3.2494
OR 4 + VESSELS/STENTS.
247........................................... PERC CARDIOVASC PROC W DRUG-ELUTING STENT W/O 2.1307
MCC.
248........................................... PERC CARDIOVASC PROC W NON-DRUG-ELUTING STENT W 3.0696
MCC OR 4 + VES/STENTS.
249........................................... PERC CARDIOVASC PROC W NON-DRUG-ELUTING STENT W/ 1.9140
O MCC.
250........................................... PERC CARDIOVASC PROC W/O CORONARY ARTERY STENT W 2.6975
MCC.
251........................................... PERC CARDIOVASC PROC W/O CORONARY ARTERY STENT W/ 1.6863
O MCC.
280........................................... ACUTE MYOCARDIAL INFARCTION, DISCHARGED ALIVE W 1.6971
MCC.
281........................................... ACUTE MYOCARDIAL INFARCTION, DISCHARGED ALIVE W 1.0232
CC.
282........................................... ACUTE MYOCARDIAL INFARCTION, DISCHARGED ALIVE W/ 0.7557
O CC/MCC.
----------------------------------------------------------------------------------------------------------------
We stated our belief that this proposal could minimize potential
disincentives to AMI model participants from transferring patients when
different or higher levels of care are needed. This is because the AMI
model-episode benchmark prices we set would be more representative of
the AMI spending based on the totality of care furnished during the
chained anchor hospitalization and post-discharge period within the AMI
model episode and for which the AMI model participants would be held
accountable. We also stated our view that our proposal could encourage
AMI model participants that frequently transfer patients after
admission to improve their efficiency and the quality of care by
transferring beneficiaries needing higher levels of care prior to
hospital admission and managing those beneficiaries admitted to reduce
the need for later transfers.
As an alternative, we also considered an approach where we would
set the target price taking into consideration IPPS payments for both
the MS-DRG assigned to the first admission in the chained anchor
hospitalization and the MS-DRG assigned to the final admission in the
chained anchor hospitalization. We could apply this approach to all AMI
model participant hospitals or to only a subset of hospitals based on
special situations that could lead to more common transfer scenarios
that are unavoidable, such as small bed-size, rural location,
interventional or cardiac surgery capacity, or other characteristic of
the hospitals. All AMI model episodes involving chained anchor
hospitalizations would include at least two IPPS payments for the
chained anchor hospitalization, compared to one IPPS payment for most
AMI episodes with only an anchor hospitalization that does not result
in an inpatient-to-inpatient transfer. In our view, the alternative
approach would likely result in a higher AMI-model episode benchmark
price than under our proposal for AMI model episodes including a
chained anchor hospitalization. Therefore, we noted that this
alternative approach could have the effect of further reducing
potential disincentives to hospitals from transferring patients when
different or a higher level of care is needed; however, we were not
convinced this approach would ultimately improve care quality and
efficiency under the AMI model.
First, we were concerned that this alternative approach could serve
as an incentive for hospitals to admit and then transfer patients when
doing so might not be medically necessary, which would neither enhance
care quality nor efficiency. A recent study showed that non-procedure
hospitals, defined as hospitals that lack onsite cardiac
catheterization and coronary revascularization facilities, vary
substantially in their use of the transfer process for Medicare
beneficiaries admitted with AMI.\79\ Beneficiaries
[[Page 308]]
transferred from hospitals that had a high transfer rate experienced
greater use of invasive cardiac procedures after admission to the
transfer hospital than beneficiaries transferred from hospitals with a
low transfer rate. However, higher transfer rates were not associated
with a significantly lower risk-standardized mortality rate at 30 days,
and at one year, there was only a 1.1 percent mortality rate difference
between hospitals with higher and lower transfer rates. As such, we
believed this alternative approach could be appropriate for only a
subset of AMI model participant hospitals based on specific hospital
characteristics that could lead to a higher frequency of unavoidable
transfers for AMI model beneficiaries rather than appropriate for
hospitals overall. In addition, if we were to adopt this alternative
approach, we believed it would also be necessary to incorporate methods
for monitoring changes in the frequency of AMI model participant
hospital patient transfers over the model's performance years, as well
as assessing the appropriateness of those transfers. For example, to
address changes in transfer frequency, we might compare how often an
AMI model participant hospital transferred a beneficiary following an
inpatient admission within each performance year relative to the
frequency of transfers during its initial 3-year historical period. To
address appropriateness of transfers, we might consider reviewing and
comparing a sample of a hospital's transfers within a performance year
as compared to the historical period. Furthermore, we might also
propose future changes to this approach where changes in the frequency
or appropriateness of transfers were identified.
---------------------------------------------------------------------------
\79\ Barreto-Filho J, Wang Y, Rathore SS, et al. Transfer Rates
From Nonprocedure Hospitals After Initial Admission and Outcomes
Among Elderly Patients With Acute Myocardial Infarction. JAMA Intern
Med. 2014;174(2):213-222. doi:10.1001/jamainternmed.2013.11944.
---------------------------------------------------------------------------
Second, in contrast to our proposal, we believed that this
alternative approach would not have the benefit of encouraging AMI
model participant hospitals to make an early decision and transfer
patients prior to rather than following inpatient admission when doing
so prior to admission would be appropriate for the beneficiary's
clinical circumstances and the hospital's capabilities. While we
recognized that in some cases, an AMI model beneficiary admitted to the
initial treating hospital may need to be transferred to a referral
hospital that can provide a different or higher level of care, we noted
our belief it is important that the AMI model's payment methodology
support the goal of rapid decision-making by the AMI model participant
hospital about the AMI model beneficiary's care pathway based on
clinical guidelines that often incorporate a time dimension in the
guidelines for care.
Thus, on balance, we believed that our proposed methodology would
best establish appropriate incentives to improve care quality and
efficiency under the AMI model by encouraging timely decisions about
admission to the initial treating hospital and incentivizing only those
transfers that are necessary to meet AMI model beneficiary's health
care during the course of their hospitalization. Our proposal would
adjust the AMI model-episode benchmark price that applies to the
episode when a chained anchor hospitalization occurs and results in
more costly care at the transfer hospital than would be expected based
on the anchor MS-DRG at the initial treating hospital who would be
accountable for the episode under the AMI model, thus accounting for
the care at the referral hospital.
In contrast, some chained anchor hospitalizations could begin an
episode based on an MS-DRG that anchors an episode in the model such as
an AMI MS-DRGs that subsequently also includes an MS-DRG that does not
anchor an episode under the model (for example, heart failure, renal
failure, or cardiac valve replacement). Some of these non-anchor MS-
DRGs could be related to the AMI episode but are unavoidable, for
example, cardiac valve surgery, while others could potentially reflect
complications resulting from inadequate care management during the
episode (for example, heart or renal failure).
As discussed in section III.C.4.b. of the proposed rule, we
proposed to cancel an AMI model episode when the final MS-DRG in a
chained anchor hospitalization is from an MS-DRG that would not an
anchor MS-DRG under the AMI or CABG model. We believed that, in tandem,
these proposals would allow for appropriate pricing of AMI model
episodes that continue and include chained anchor hospitalizations.
The proposals to establish pricing for AMI model episodes involving
chained anchor hospitalizations were included in Sec.
512.300(c)(7)(i). We sought comment on our proposals for pricing AMI
episodes involving chained anchor hospitalizations and the alternative
proposals we considered. We also sought comment on the alternative
considered that would account for both the MS-DRGs at the first and
last hospitals caring for the AMI model beneficiary during the chained
anchor hospitalization in setting the AMI-model episode benchmark price
for episodes involving a chained anchor hospitalization. In particular,
under such an alternative, we sought comment on the clinical
circumstances in which inpatient-to-inpatient transfers are unavoidable
and whether or not there are hospital characteristics that would lead
us to expect higher frequencies of unavoidable inpatient-to-inpatient
transfers for AMI model beneficiaries than hospitals overall. We also
sought comment on how we could discourage unintended consequences under
this alternative, such as less timely decisions about the most
appropriate hospital to treat the beneficiary and increased beneficiary
transfers that are unnecessary or inappropriate for improved quality of
AMI model episode care.
The following is a summary of the comments received and our
responses.
Comment: As discussed earlier in Section III.C.4.a. of this final
rule, many commenters expressed concerns and opposed the proposal that
once an AMI model episode is initiated at an AMI model participant, the
AMI model episode continues under the responsibility of that specific
participant, regardless of whether the beneficiary is transferred to
another hospital for further medical management of AMI or
revascularization through PCI or CABG during a chained anchor
hospitalization. Similarly, many commenters expressed concerns with
respect to the pricing of episodes in the case of these chained anchor
hospitalizations that generally paralleled the comments discussed in
section III.C.4.a. of this final rule.
Response: As discussed in section III.C.4.a., we were persuaded by
commenters to not finalize our proposal that once an AMI model episode
is initiated at an AMI model participant, the AMI model episode would
continue under the responsibility of that specific participant when a
beneficiary is transferred to another hospital for further medical
management of AMI or revascularization through PCI or CABG during a
chained anchor hospitalization. Instead, we are finalizing a policy
that for an episode involving an inpatient-to-inpatient transfer, the
episode would be attributed to the transfer hospital rather than the
initial hospital.
Accordingly, we are also not finalizing our proposed pricing
methodology for these episodes, which would have set a chain-adjusted
AMI model-episode benchmark price or ``price MS-DRG'' based on the AMI,
PCI, or CABG MS-DRG in the chained-
[[Page 309]]
anchor admission with the highest IPPS weight. Instead, we are
finalizing a policy where an episode's price will be determined only by
the anchor MS-DRG for the AMI or CABG model episode as determined by
the transfer hospital in the same manner as we would for any other AMI
episode that does not involve a transfer.
Since we are not finalizing our original proposal, we also will not
be finalizing the terms ``chained anchor hospitalization'' or ``price
MS-DRG'' as all episodes under the model will be priced based on their
assigned anchor MS-DRG. Accordingly, we will be deleting these terms
from our proposed regulations.
Final Decision: After consideration of the public comments
received, we are not finalizing the proposal to make payment
adjustments for AMI episodes involving a chained anchor
hospitalization, but will instead attribute the episode to the final
hospital and calculate prices for these episodes based on the anchor
MS-DRG for that episode determined by the transfer hospital. As such,
we are replacing the term ``price MS-DRG'' with ``MS-DRG'' and deleting
references to ``chained-anchor hospitalizations.'' Also as discussed in
section III.C.4.a.(5) of this final rule, given our concerns about the
potential missed opportunities and unintended consequences due to the
final AMI model transfer episode initiation and attribution policy, we
will be examining AMI transfers to and from AMI model participants very
closely through our monitoring and evaluation activities as discussed
in sections III.G.4. through 6. and IV. of this final rule, both of
beneficiaries that ultimately are included in AMI episodes and those
that are not. We may revisit the transfer policy or propose payment
adjustments through future rulemaking if we see reduced AMI transfer
efficiency, opportunities to increase transfer efficiency,
disproportionate transfers of complex AMI beneficiaries or those with
potentially avoidable complications suggesting that AMI model
participants are engaging in adverse patient selection or providing
poor quality care, inordinate loss of beneficiaries from the AMI model
due to transfer outside of the MSAs where the AMI and CABG models are
being tested, or other patterns of concern.
(b) Adjustments for CABG Model Episodes
Among Medicare beneficiaries historically discharged under a CABG
MS-DRG, average episode spending was substantially higher for those
beneficiaries who also had AMI ICD-CM diagnosis codes on their
inpatient claims ($57,000) than those who did not ($44,000).\80\ About
30 percent of CABG beneficiaries had AMI ICD-CM diagnosis codes on
their claims, while about 70 percent did not, and this percentage of
CABG beneficiaries with AMI varied substantially across IPPS hospitals
furnishing CABG procedures.\81\ While average spending, in total, was
substantially higher for CABG beneficiaries with AMI than without AMI,
average spending during the anchor hospitalization was not
substantially higher. Rather, much of this variation in CABG model
episode spending occurred after discharge from the anchor
hospitalization and correlated both with the presence of AMI and
whether the CABG beneficiary was discharged from the anchor
hospitalization in a CABG MS-DRG with major complication or comorbidity
(MS-DRGs 231, 233, or 235) as opposed to a CABG MS-DRG without major
complication or comorbidity (MS-DRGs 232, 234, or 236). Specifically,
we found that average CABG episode spending after discharge from the
anchor hospitalization was--
---------------------------------------------------------------------------
\80\ Episodes for CABG model beneficiaries initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in this rule, that began in CYs 2012-
2014.
\81\ Episodes for CABG model beneficiaries initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in this rule, that began in CYs 2012-
2014.
---------------------------------------------------------------------------
$9,000 for non-AMI CABG beneficiaries discharged from MS-
DRGs 232, 234, or 236;
$11,000 for CABG beneficiaries with AMI discharged from
MS-DRGs 232, 234, or 236;
$16,000 for non-AMI CABG beneficiaries discharged from MS-
DRGs 231, 233, or 235; and
$20,000 for CABG beneficiaries with AMI discharged from
MS-DRGs 231, 233, or 235.\82\
---------------------------------------------------------------------------
\82\ Episodes for CABG model beneficiaries initiated by all U.S.
IPPS hospitals and constructed using standardized Medicare FFS Parts
A and B claims, as proposed in this rule that began in CYs 2012-
2014.
---------------------------------------------------------------------------
Thus, for CABG model episodes, we proposed to set CABG model-
episode benchmark prices by first splitting historical CABG model-
episode expenditures into expenditures that occurred during anchor
hospitalizations and expenditures that occurred after discharge from
the anchor hospitalizations.
We proposed to calculate the CABG anchor hospitalization benchmark
price by following the general payment methodology that was applied to
the CJR model (80 FR 73337 through 73358), with expenditures limited to
those that occurred during the anchor hospitalization and risk
stratification according to the price CABG MS-DRG.
We also proposed to calculate the CABG post-anchor hospitalization
benchmark price by following the general payment methodology that was
applied to the CJR model (80 FR 73337 through 73358), with expenditures
limited to those that occurred after the anchor hospitalization and
risk-stratification according to the presence of an AMI ICD-CM
diagnosis code on the anchor inpatient claim and whether the price MS-
DRG is a CABG MS-DRG with major complication or comorbidity (231, 233,
or 235) or a CABG MS-DRG without major complication or comorbidity
(232, 234, or 236).
We proposed that the CABG model-episode benchmark price for an
episode would be the sum of the corresponding CABG anchor
hospitalization benchmark price and the corresponding CABG post-anchor
hospitalization benchmark price, as discussed in this section and in
III.D.4.d. of the proposed rule.
The proposals to establish pricing for CABG model episodes were
included in Sec. 512.300(c)(7)(ii). We sought comment on our proposals
to establish pricing for CABG model episodes.
The following is a summary of the comments received and our
responses.
Comment: One commenters suggested that CMS create a separate target
price for CABG episodes where a patient has a previous history of CABG.
Response: We appreciate the commenter's suggestion, but believe the
existing MS-DRGs that apply under the IPPS, which similarly do not
distinguish CABG MS-DRG discharges based on whether or not a
beneficiary had a previous history of CABG, our proposed pricing
adjustments for CABG episodes, and additional risk-adjustments that we
anticipate will be effective in PY3 should appropriately recognize the
potential costs for beneficiaries within CABG episodes whether or not
they had a previous history of CABG.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
establish pricing for CABG model episodes. Our final policy for
establishing CABG model episodes is included in Sec. 512.300(c)(7)(i).
(c) Adjustments for Certain AMI Model Episodes With CABG Readmissions
In section III.C.4.b of the proposed rule, we discussed AMI model
episodes where a beneficiary is discharged from an AMI model
participant under an AMI
[[Page 310]]
MS-DRG and is later readmitted for a CABG. In that section, we did not
propose to cancel the AMI model episode altogether for a CABG
readmission during the 90-day post-hospital discharge period or cancel
the AMI model episode and initiate a CABG model episode because planned
CABG readmission following an anchor hospitalization that initiates an
AMI episode may be an appropriate clinical pathway for certain
beneficiaries. For example, we noted that historically approximately 10
percent of those AMI beneficiaries who received CABGs during AMI
episodes would receive the CABG between 2 and 90 days post-discharge
from the anchor hospitalization, and most of those readmissions did not
occur through hospital emergency departments. Even though CABG
readmissions are not excluded from AMI model episodes (because they are
clinically-related to the AMI model episode), we proposed to provide an
adjusted AMI model-episode benchmark price in such circumstances so as
not to financially penalize AMI model participants for relatively
uncommon, costly, clinically-appropriate care patterns for AMI model
beneficiaries. Accordingly, we proposed to establish an adjusted CABG-
readmission AMI model-benchmark episode price for AMI model episodes
with a price MS-DRG of 280-282 or 246-251 that have readmission for a
CABG MS-DRG 231-236.
Specifically, if a CABG readmission occurs during an AMI model
episode with a price MS-DRG of 280-282 or 246-251, we proposed to
calculate a CABG-readmission AMI model-episode benchmark price equal to
the sum of the standard AMI model-episode benchmark price corresponding
to the price MS-DRG (AMI MS-DRGs 280-282 or PCI MS-DRGs 246-251) and
the CABG anchor hospitalization benchmark price corresponding to the
MS-DRG of the CABG readmission. Because the adjustment would be based
on the anchor hospitalization benchmark price, which does not include
costs associated with the post-discharge period for CABG, this
adjustment approach would avoid ``double counting'' post-discharge
costs. Because adjusting for spending that occurred during a CABG
readmission accounts for most of the spending variation between AMI
model episodes with a CABG readmission and AMI model episodes without a
CABG readmission, we proposed no additional adjustment to the price for
AMI model episodes with a CABG readmission.
In the event of any other readmission other than CABG during an AMI
model episode that is not excluded from the AMI model episode
definition, we would apply the usual rules of EPM-episode pricing that
would include the spending for the related readmission in the actual
AMI model-episode spending, without other adjustments. Fewer than 3
percent of those AMI model beneficiaries who receive inpatient or
outpatient PCIs during AMI episodes receive the PCIs between 2 and 90
days post-discharge from the anchor or chained anchor hospitalizations,
and we did not propose to make a pricing adjustment for PCIs that occur
later in the AMI model episodes after discharge from the anchor or
chained anchor hospitalizations. Since a PCI for an AMI typically is
provided during the anchor or chained anchor hospitalization and most
PCIs later in an episode occur in the context of a beneficiary
presenting through the emergency department, we believe that the
beneficiary likely has experienced a complication of care resulting in
a PCI that may potentially be avoided through care management during
the AMI model episode. Given that our intention is to offer appropriate
incentives for care quality and efficiency by holding AMI model
participants accountable for readmissions that could be related to the
quality of care provided prior to the readmission, we believe that an
adjustment other than for a CABG readmission would not be appropriate.
The proposal for adjusting episodes involving CABG readmissions was
included in Sec. 512.300(c)(7)(iii). We sought comment on our proposal
for adjusting episodes involving CABG readmissions.
The following is a summary of the comments received and our
responses.
Comment: Several commenters expressed concerns about the proposal
for adjusting episodes involving CABG readmissions--specifically, that
the proposal does not sufficiently account for the increased post-acute
care that a beneficiary typically receives after a CABG, but which they
would not receive after only an AMI. One of the commenters presented
data supporting their concern suggesting that post-discharge spending
for certain MS-DRGs with a CABG readmission was substantially higher
than for those same MS-DRGs without a CABG readmission. The commenters
requested that CMS modify the methodology to account for the increased
post-acute care that a beneficiary typically receives after a CABG.
Response: We appreciate the concerns raised by the commenters and
have conducted further analysis of our proposal with respect to how
well our proposal would account for post-acute care costs for AMI
episodes involving CABG readmissions. While we agree that spending
after discharge from the anchor stay for AMI episodes with CABG
readmissions is substantially higher than for episodes without these
readmissions, we disagree with suggestions that our proposal
inadequately adjusts for these differences. Rather, based on our
analysis, on average, the proposed adjustments account for the
overwhelming majority of additional spending that occurs in AMI
episodes with CABG readmissions relative to episodes without CABG
readmissions. Additionally, the number of episodes for many of the
affected MS-DRGs is relatively small, which we believe would impede our
ability to establish reliable prices that would be an improvement over
our current proposal in terms of payment accuracy. Accordingly, we are
not persuaded to modify our proposal.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
adjust episodes with CABG readmissions. Our final policy for adjusting
episodes with CABG readmissions is included in Sec. 512.300(c)(7)(ii).
(d) Potential Future Approaches To Setting Target Prices for AMI and
Hip Fracture Episodes
As previously described, our proposed approach for pricing AMI and
CABG model episodes for beneficiaries with AMI set different episode
target prices depending upon whether the beneficiary is managed
medically, undergoes PCI, or undergoes CABG during the acute phase of
the episode, as well as whether the episode involved a chained anchor
hospitalization or CABG readmission. Similarly, the target price set
for beneficiaries experiencing hip fracture would depend on whether the
patient undergoes hip fixation (and therefore initiates a SHFFT model
episode) or hip arthroplasty (and therefore initiates a CJR model
episode). We believed that this would be a prudent approach that both
recognizes the resource costs of services provided while encouraging
care redesign during the portions of these episodes that we believe
present the greatest opportunities to improve the quality and
efficiency of the care delivered. However, we noted that the general
principle guiding our payment reform efforts is that the payment system
should hold providers accountable for the overall quality and cost of
the care their beneficiaries receive rather than
[[Page 311]]
setting their payment based on the specific services delivered or
settings in which they are delivered. We indicated that this approach
would give providers maximum flexibility to redesign care in ways that
both produce the best outcomes for patients and controls the growth in
spending for these services.
For this reason, we expressed interest in exploring future
approaches to episode payment that would set an inclusive target price
for episodes for beneficiaries with AMI that does not depend on whether
the beneficiary is managed medically or receives PCI or CABG during the
acute portion of the episode and, similarly, future approaches that
would set prices for episodes for beneficiaries with hip fracture that
do not depend on whether the beneficiary undergoes hip fixation or hip
arthroplasty. While we believe that the choice of treatment during the
acute phase of these episodes may be determined predominantly by
clinical factors such that financial factors may play a smaller role in
shaping episode care redesign than they do following hospital
discharge, we nevertheless believe it would be valuable to consider
testing an inclusive episode payment model. Providers may be able to
redesign and implement care pathways that we might not have otherwise
anticipated, especially as the evidence-base for AMI and hip fracture
treatment continues to grow and evolve.
We sought comment on this type of approach to setting an inclusive
episode target price and on any episode payment model design features
that would be needed to make such an approach successful. In
particular, we sought comment on potential approaches to risk-
adjustment aimed at ensuring that providers are appropriately paid for
caring for high-complexity episode beneficiaries in the context of this
alternative approach. We would seek to ensure that all providers caring
for these episode beneficiaries, including those providers for which we
proposed additional protections and those that serve a high percentage
of potentially vulnerable populations of medically and socially complex
patients as discussed in section III.D.7.c. of the proposed rule, would
not bear undue financial risk and to mitigate any incentives to avoid
caring for high-complexity patients. In addition, we sought comment on
whether and how our methodology linking quality performance to payment
under the EPMs and the CJR model might need to be modified in the
context of this alternative approach that would set an inclusive
episode target price, in order to appropriately incentivize the
delivery of high-quality care and discourage stinting on appropriate
care.
The following is a summary of the comments received and our
responses. The comments we received typically recommended that we
consider either population-based models or capitated models, which we
have addressed in section III.D.2.b. of this final rule; however, we
are providing some specific examples that were recommended in the
following comments.
Comment: A commenter recommended that we consider a population-
based model that was tied to an ``event'' such as a beneficiary's
initial Medicare enrollment in a selected geographic area such as a
county or MSA; however, we should exclude Medicare Advantage enrollees
or enrollees participating in other Medicare payment reform efforts.
The model would include multiple quality measures reflecting both a
clinical perspective and a beneficiary perspective. The model could
include two tracks: Full financial accountability and partial financial
accountability. Under the first track, we would pay participating
providers a monthly, all-inclusive, beneficiary-risk-adjusted premium
based on regional historical expenditures and the provider would assume
full risk for all Part A and Part B expenditures. Under the partial
financial accountability track, we would continue to provide the plan
administration (allowing provider organizations without claims-payment
and risk-assumption capabilities the opportunity to participate). Model
participants would receive a monthly, beneficiary-risk-adjusted target
budget for Medicare Part A and Part B services and their actual
expenditures would be compared against their target budget at the end
of each year for reconciliation. If costs exceeded the target, then the
participant would repay CMS an agreed upon amount. If costs were below
the target, then CMS would pay the participant an agreed upon amount.
Both tracks could be eligible for Advanced APM designation under the
Quality Payment Program, if they had a certified Electronic Health
Record technology requirement for participants.
Another commenter, who had suggested that CMS adopt a model
including prospective negotiated rates rather than retrospective
reconciliation of fee-for-service claims, suggested that a capitated
model would allow providers to experiment with services, in addition to
telehealth consultations, that do not generate a fee-for-service claim.
In their view, hospitals and surgeons have more opportunity to innovate
in how they deploy professional staff, choose technology, and engage
with outpatient and home-based services when they have full flexibility
within a budgeted payment amount, and would encourage collaboration
between all clinicians involved in patient care as well as provide
predictable pricing. Also, the commenter believes that using
prospectively determined negotiated rates or competitive bids would
result in a more rapid transformation in cost and resource use. In
their view, using target prices based on a provider's historical costs
or the region's average costs is inconsistent with the goal of
implementing innovative payment models. Moreover, current practice
patterns should not be used to set a total cost for care, given the
unnecessary care, excessive costs and cost variations that result from
this payment approach. As such, this commenter recommend that providers
competitively bid their episode price to encourage competition among
providers to achieve the best outcomes for the lowest cost.
A commenter recommended that CMS design EPMs that would allow
providers two options; specifically to (1) organize themselves in the
manner most efficient to accept a prospective bundled payment from
Medicare, and allocate it among the participating providers or (2) if
other providers find it easier to continue billing under current
payment systems, then retrospectively reconcile those payments against
a prospectively defined budget. In this commenter's view, jointly-
governed teams should have the flexibility to determine which
organizational approach and retrospective or prospectively-determined
payment model best works for their particular circumstances.
Another commenter suggested that CMS consider a model that pays
specialists for management of specific conditions and combinations of
conditions using the same payment model concepts being used with
primary care physicians in the Comprehensive Primary Care Plus
initiative. Under this model, CMS should focus accountability on
services directly related to the condition, rather than total spending
on all of the patients' health care needs and for which the physician
may be unable to control. Further, the model would encourage the use of
physician-defined patient condition categories to ensure effective risk
stratification in condition-based payment models. These models would be
risk stratified based on the clinical characteristics and functional
status of patients that are most relevant to the types of conditions
being
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managed. Patients could designate the physician who would be managing
care for their condition(s) but would be required to use the team of
providers chosen by that physician for delivery of services related to
the condition(s). Further, target spending amounts would be set for
condition-based payments and episode payments prior to the beginning of
the performance period. Finally, physicians and other providers could
be for high-value services that are not currently billable as part of
condition-based and episode-based payment models that use retrospective
reconciliation.
Another commenter noted that while not recommending a specific
framework, CMS should consider additional geographic-based models that
include other costly procedures that vary in total episode costs, for
example, spine surgery.
Response: We appreciate the comments and suggestions that were
offered and that while not adopting these suggestions for these models,
we will take them into consideration as we explore similar models in
the future.
(e) Summary of Final Pricing Methodologies for AMI, CABG, and SHFFT
Model Episode Scenarios
Tables 14 through 16 summarize our final standard pricing
methodologies and the adjustments that will occur that are in sections
III.D.4.b.(1) and (2) of this final rule for AMI, CABG, and SHFFT model
episodes.
Table 14--AMI Model Pricing Scenarios
------------------------------------------------------------------------
AMI pricing scenario Price
------------------------------------------------------------------------
Single hospital AMI MS-DRG or PCI MS- Episode benchmark price is
DRG (with AMI diagnosis). standard episode benchmark
price based on anchor MS-DRG.
An AMI MS-DRG or PCI MS-DRG (with AMI Episode benchmark price is the
diagnosis) anchored episode with CABG sum of the standard episode
readmission. benchmark price corresponding
to the anchor MS-DRG and the
CABG anchor hospitalization
benchmark price corresponding
to the CABG readmission MS-
DRG.
------------------------------------------------------------------------
Table 15--CABG Model Pricing Scenarios
------------------------------------------------------------------------
CABG pricing scenario Price
------------------------------------------------------------------------
Single hospital CABG MS-DRG with AMI Episode benchmark price is the
diagnosis. sum of the CABG anchor
hospitalization benchmark
price for the MS-DRG and the
CABG post-anchor
hospitalization benchmark
price based on the presence of
an AMI ICD-CM diagnosis code
and whether the anchor MS-DRG
is w/MCC or w/o MCC.
Single hospital CABG MS-DRG without AMI Episode benchmark price is the
diagnosis. sum of the CABG anchor
hospitalization benchmark
price for the MS-DRG and the
CABG post-anchor
hospitalization benchmark
price based on no AMI ICD-CM
diagnosis code and whether the
anchor MS-DRG is w/MCC or w/o
MCC.
------------------------------------------------------------------------
Table 16--SHFFT Model Pricing Scenarios
------------------------------------------------------------------------
SHFFT pricing scenario Price
------------------------------------------------------------------------
SHFFT MS-DRG........................... Episode benchmark price is
standard episode benchmark
price based on anchor MS-DRG
(which is the price MS-DRG).
------------------------------------------------------------------------
(3) Three Years of Historical Data
As was the case for the CJR model (80 FR 73340 through 73341), we
proposed to use 3 years of historical EPM episodes for calculating EPM
participants' EPM-episode benchmark prices, with each set of historical
episodes updated every other year (81 FR 50854). Under our proposal,
each of the first 2 years of historical data would be trended to the
most recent of the 3 years, based on national trend factors for each
combination of price MS-DRGs and payments would be updated for each
payment system (for example, IPPS, PFS, etc.) based on annual changes
in input costs (see sections III.D.4.b (4) and III.D.4.b (5) of the
proposed rule). Under our proposal, we would establish historical EPM-
episode payments based on episodes that started between--
January 1, 2013 and December 31, 2015 for performance
years 1 and 2;
January 1, 2015 and December 31, 2017 for performance
years 3 and 4; and
January 1, 2017 and December 31, 2019 for performance year
5.
We believe that 3 years of historical EPM-episode data should
provide sufficient historical episode volume to reliably calculate EPM-
episode benchmark prices, and that updating these data every other year
would allow us to make the most current claims data available in a way
that incorporates the effects of regular Medicare payment system
updates and changes in utilization without creating uncertainty in
pricing for EPM participants. We would further note that the effects of
updating EPM-participant hospital-specific data on an EPM-episode's
benchmark prices would diminish over time as the contribution of
regional pricing on EPM benchmark prices will increase from one-third
for performance years 1 and 2 to two-thirds in performance year 3, and
100 percent in performance years 4 and 5.
The proposal for 3 years of historical data updated every other
year under the EPMs was included in Sec. 512.300(c)(1).
We sought comment on our proposal for 3 years of historical data
updated every other year.
The following is a summary of the comments received and our
responses.
Comment: Some commenters requested that CMS apply more trend data
than the 3 years we proposed. A commenter expressed concern that in the
absence of several years of historical data, target setting would not
fully reflect case mix and behavior changes in addition to historical
claims patterns.
[[Page 313]]
Further, an impact of a focus on short-term costs may be a shift away
from new technologies proven to improve outcomes and reduce costs.
Another commenter requested an additional 2 years of trend data for
Program Year 1, to bring the data up from 2015 to the 2017 program
level and another 3 years of trend data to bring the 2015 claims up to
the 2018 level. A commenter requested that the process be open and
transparent so as to insure that all impacted collaborators are given
the information and opportunity to comment and adjust.
Response: We continue to believe our proposed period for 3 years of
historical data updated every other year is appropriate for the models.
We disagree that including additional years of data beyond those we
proposed would be necessary or helpful. Instead, rather than improving
our historical data, the request for additional years of data could
result in more heterogeneous historical data that is less reflective of
a participant's most recent performance.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification to use 3
years of historical EPM episodes for calculating EPM participants' EPM-
episode benchmark prices, with each set of historical episodes updated
every other year. The final policy for using 3 years of historical EPM
episodes for calculating benchmark prices is included in Sec.
512.300(c)(1).
(4) Trending Historical Data to the Most Recent Year
We recognize that some payment variation could exist in the 3 years
of historical EPM-episode data due to annual Medicare payment system
updates (for example, IPPS, OPPS, IRF PPS, SNF PPS) and national
changes in utilization patterns. Thus, EPM episodes in the third year
of the 3 historical years might have higher average payments than those
from the earlier 2 years, in part due to Medicare payment rate
increases over the course of the 3-year period. Also, EPM-episode
payments could change over time due to national trends reflecting
changes in industry-wide practice patterns. For example, readmissions
for all patients, including those in CABG model episodes, may decrease
nationally due to improved industry-wide surgical protocols that reduce
the chance of infections. We do not intend for the incentives under the
EPMs to be affected by Medicare payment system rate changes that are
beyond EPM participants' control or to provide reconciliation payments
to (or require repayments from) EPM participants for achieving lower
(or higher) Medicare expenditures solely because they followed national
changes in practice patterns. Instead, we aim to incentivize EPM
participants to improve care quality and efficiency based on their
hospital-specific inpatient and post-discharge care practices under the
EPMs.
To mitigate the effects of Medicare payment system updates and
changes in national utilization practice patterns on the 3 years of
historical episode data, we proposed to apply a national trend factor
to each of the years of historical EPM-episode payments (81 FR 50855)
as we do with the CJR model (80 FR 73341 through 73342). Specifically,
we proposed to inflate the 2 oldest years of historical EPM-episode
payments for EPM episodes to the most recent year of the 3 historical
years using changes in the national EPM-episode payments for each
different type of EPM episode. That is, we proposed to apply separate
national trend factors for the following pricing scenarios:
SHFFT model episodes, separately by each price MS-DRG in
480-482.
AMI model episodes without CABG readmissions, separately
by each price MS-DRG in 280-282 and 246-251; and
The anchor hospitalization portion of CABG model episodes,
separately by each price MS-DRG in 231-236.
The post-anchor hospitalization portion of CABG model
episodes, separately for:
++ With AMI ICD-CM diagnosis code on the anchor inpatient claim and
CABG price MS-DRG with major complication or comorbidity (231, 233, or
235);
++ With AMI ICD-CM diagnosis code on the anchor inpatient claim and
CABG price MS-DRG without major complication or comorbidity (232, 234,
or 236);
++ Without AMI ICD-CM diagnosis code on the anchor inpatient claim
and CABG price MS-DRG with major complication or comorbidity (231, 233,
or 235); and
++ Without AMI ICD-CM diagnosis code on the anchor inpatient claim
and CABG price MS-DRG without major complication or comorbidity (232,
234, or 236).
For example, when using Calendar Year (CY) 2013 through 2015
historical EPM-episode data to establish EPM-episode benchmark prices
for performance years 1 and 2, we would calculate an aggregate national
average SHFFT model episode payment in historical episodes with price
MS-DRG 480 for each of the 3 historical years. To trend historical
payments to the most recent year in an historical window, we would
create a ratio based on national average historical EPM-episode payment
for that episode type in a previous year and for the most recent year.
Thus, in this example, we would create a ratio of national average
SHFFT model historical episode payment with price MS-DRG 480 in CY 2015
as compared to that national average SHFFT model historical episode
payment in CY 2013 in order to trend the CY 2013 historical SHFFT model
episode payments to CY 2015. Similarly, we would determine the ratio of
the national average SHFFT model historical episode payment for CY 2015
to national average SHFFT model historical episode payment in CY 2014
to trend 2014 SHFFT model episode payments to CY 2015. This process
would be repeated for each pricing scenario previously listed.
We noted our belief that this method for trending data would
capture updates in Medicare payment systems as well as national
utilization pattern changes that might have occurred within that 3-year
period. Moreover, as with the CJR model, we believed that adjusting for
national rather than regional trends in utilization would be most
appropriate as any Medicare payment system updates and significant
changes in utilization practice patterns would not be region-specific
but rather be reflected nationally.
The proposal for trending historical data was included in Sec.
512.300(c) (11). We sought comment on our proposal for trending
historical data.
The following is a summary of the comments received and our
responses.
Comment: A few commenters addressed the use and trending of
historical data. A commenter expressed their general agreement with the
proposed trending methodology, but recommended that CMS update prices
every other year rather than annually to limit the extent that
participants would face increasingly more difficult targets. Another
commenter recommended that CMS trend the initial 3 years of historical
data for the full five years of the models. A commenter suggested that
CMS apply more trend data to each performance year and expressed
concerns that while CMS would trend data to the end of the benchmark 3-
year period, CMS would not be trending data from the end of the
benchmark period to match the time period for which the prices will be
applied to pay providers.
Response: We appreciate the comments we received on our proposal to
trend data and would like to clarify that their application would be on
a semi-annual basis when we update target prices rather than annually.
We disagree with the suggestion to apply
[[Page 314]]
the 3 initial years of trend data to all five performance years as our
intention is to establish target prices for the models using more
recent performance data so as to maintain incentives for participants
to continuously improve. Similarly, we disagree with the suggestion to
expand the number of years used to trend data or to permanently relate
trend data for a given performance year to those data for the initial
3-year benchmark period as doing so would result in data that are less
representative of a participant's most recent performance.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
trend data. Our final policy for trending data is included in Sec.
512.300(c) (11).
(5) Update Historical EPM-Episode Payments To Account for Ongoing
Payment System Updates
As previously mentioned, we proposed to prospectively update the
historical EPM- episode payments to account for ongoing updates to
Medicare payment systems (for example, IPPS, OPPS, IRF PPS, SNF, PFS,
etc.) in order to ensure we incentivize EPM participants based on
historical utilization and practice patterns, not Medicare payment
system rate changes that are beyond hospitals' control. Under our
proposal (81 FR 50855), we would apply the same methodology developed
for the CJR model to incorporate Medicare payment updates (80 FR 73342
through 73446).
Because Medicare payment systems rates are not updated at the same
time during the year--for example, rates under the IPPS, IRF PPS, and
SNF payment systems are updated effective October 1, while the hospital
OPPS and MPFS rates are updated annually effective January 1--we
proposed to generally update historical EPM-episode payments and
calculate EPM-episode benchmark prices separately for EPM episodes
initiated between January 1 and September 30 versus October 1 and
December 31 of each performance year, and at other intervals if
determined necessary. The EPM-episode benchmark price in effect as of
the day the EPM episode is initiated would be the EPM-episode benchmark
price for the whole EPM episode. Note that for performance year 5, the
second set of EPM-episode benchmark prices would be for EPM episodes
that start and end between and including October 1 and December 31
because the fifth performance period of the SHFFT, CABG, and AMI models
would end on December 31, 2021. Also, an EPM episode benchmark price
for a given EPM performance year could be applied to EPM episodes
included in another performance year. For example, an EPM episode
initiated in November 2017, and ending in February 2018 would have an
EPM-episode benchmark price based on the second set of 2017 EPM-episode
benchmark prices (for EPM episodes initiated between October 1, 2017,
and December 31, 2017), and it would be captured in the CY 2018 EPM
performance year (performance year 2) because it ended between January
1, 2018, and December 31, 2018. We refer to section III.D.2.a. of this
final rule for further discussion on the definition of EPM performance
years.
We proposed to update historical EPM-episode payments by applying
separate Medicare payment system update factors each January 1 and
October 1 to each of the following six components of each EPM
participant's historical EPM-episode payments:
Inpatient acute.
Physician.
IRF.
SNF.
HHA.
Other services.
A different set of update factors would be calculated for January 1
through September 30 versus October 1 through December 31 EPM episodes
each EPM performance year. The six update factors for each of the
previously stated components would be EPM-participant hospital-specific
and would be weighted by the percent of the Medicare payment for which
each of the six components accounts in the EPM participant's historical
EPM episodes. The weighted update factors would be applied to
historical EPM-participant-specific average payments to incorporate
ongoing Medicare payment system updates. A weighted update factor would
be calculated by multiplying the component-specific update factor by
the percent of the EPM participant's historical EPM-episode payments
the component represents, and summing together the results. Each of an
EPM participant's six update factors would be based on how inputs have
changed in the various Medicare payment systems for the specific EPM
participant.
As an example, we would assume for purposes of this example that 50
percent of an EPM participant's historical EPM-episode payments were
for inpatient acute care services, 15 percent were for physician
services, 35 percent were for SNF services, and 0.0 percent were for
the remaining services. We would also assume for purposes of this
example that the update factors for inpatient acute care services,
physician services, and SNF services are 1.02, 1.03, and 1.01,
respectively. The weighted update factor in this example would be the
following: (0.5 * 1.02) + (0.15 * 1.03) + (0.35 * 1.01) = 1.018. The
EPM participant in this example would have its historical average EPM-
episode payments multiplied by 1.018 to incorporate ongoing payment
system updates. The specific order of steps, and how this step fits in
with others, is discussed further in sections III.D.4.c through d. of
the proposed rule. Also, as discussed further in sections III.D.4.c.
through d. of the proposed rule, the update factors would vary by price
MS-DRG. For example, in CABG model episodes, the update factors would
be calculated separately for the anchor hospitalization portion of
episodes and the post-anchor hospitalization portion of episodes, as
described in section III.D.4.d. of the proposed rule.
Region-specific update factors for each of the previously stated
components and weighted update factors would also be calculated in the
same manner as the EPM-participant-specific update factors. Instead of
using historical EPM episodes attributed to a specific hospital,
region-specific update factors would be based on all historical EPM
episodes initiated at any IPPS hospital within the region with
historical EPM episodes, regardless of whether or not the MSAs in which
the hospitals are located were selected for inclusion in the models. We
referred to the CJR Final Rule (80 FR 73342 through 73446) for further
discussion of our specific methodology and considerations for adopting
this methodology for updating historical EPM-episode payments for
ongoing payment system updates.
The proposal for updating episode payments for ongoing annual
Medicare payment updates was included in Sec. 512.300(c)(10). We
sought comment on our proposal for updating episodes payments for
ongoing annual Medicare payment updates. We received no specific
comments on our proposal for updating historical EPM-episode payments
to account for ongoing payment system updates. However, we wish to
highlight that, as we do for the CJR model (80 FR 73343 through 73344),
where an equation is used to calculate update factors for payment
systems that apply annual updates to their rates effective October 1 of
each year such as for inpatient acute, SNF, and IRF services, in lieu
of calculating the update factors using the values applicable at the
end of the latest historical year used to calculate target prices, we
use a blend of the values applicable during the latest historical
[[Page 315]]
year. This blend is intended to account for the payment systems that
update payment rates on a fiscal year cycle, and ensure we are
calculating update factors based on the payment rates that apply to a
given period to the extent feasible, and result in more accurate target
price calculations.
Final Decision: We are finalizing the proposal, without
modification, to update episode payments for ongoing annual Medicare
payment updates. The final policy for updating episode payments for
ongoing annual Medicare payment updates is included in Sec.
512.300(c)(10).
(6) Blend Hospital-Specific and Regional Historical Data
We proposed to calculate EPM-episode benchmark prices using a blend
of EPM-participant-specific and regional historical average EPM-episode
payments, including historical EPM-episode payments for all IPPS
hospitals that are in the same U.S. Census division, which was
discussed further in section III.D.4.b.(7) of the proposed rule (81 FR
50856). Specifically, we proposed to blend two-thirds of the EPM-
participant-specific historical EPM-episode payments and one-third of
the regional historical EPM-episode payments to set an EPM
participant's EPM-episode benchmark prices for the first 2 performance
years of the EPMs (CYs 2017 and 2018). For performance year 3 of the
EPMs (CY 2019), we proposed to adjust the proportion of the EPM-
participant-specific and regional historical EPM-episode payments used
to calculate the EPM-episode benchmark prices from two-thirds EPM
participant-specific and one-third regional to one-third EPM
participant-specific and two-thirds regional. Finally, we proposed to
use only regional historical EPM-episode payments for performance years
4 and 5 of the EPMs (CYs 2020 and 2021) to set an EPM participant's EPM
episode-benchmark prices, rather than a blend between the participant-
specific and regional historical EPM episode payments.
Consistent with our methodology for the CJR model (80 FR 73544), we
proposed two exceptions. First, we proposed to use only regional
historical EPM-episode payments to calculate EPM episode-benchmark
prices for EPM participants with low historic EPM-episode volume). For
SHFFT model episodes, this exception applies to SHFFT model
participants with fewer than 50 historical SHFFT model episodes in
total across the 3 historical years. For AMI model episodes anchored by
MS-DRGs 280-282, this exception applies to AMI model participants with
fewer than 75 of these particular AMI model historical episodes in
total across the 3 historical years. For AMI model episodes anchored by
PCI MS-DRGs 246-251, this exception applies to AMI model participants
with fewer than 125 of this particular AMI model historical episodes in
total across the 3 historical years. For CABG model episodes, this
exception applies to CABG model participants with fewer than 50
historical CABG model episodes in total across the 3 historical years.
The thresholds for low historic volume in this final rule are higher
than the CJR model threshold for low historical LEJR episode volume of
20 episodes in total across the 3 historical years. The higher
thresholds are based on the volume thresholds from the BPCI Model 2
Risk Track B for 90-day episodes, which increase when the ratio of
within-hospital episode spending variation to between-hospital episode
spending variation increases. That is, as EPM episode payment variation
increases within a hospital relative to EPM-episode payment variation
between hospitals, it is necessary to have more EPM episodes at that
hospital to estimate a stable EPM-episode benchmark price using data
from only that hospital. We proposed to set higher thresholds for the
SHFFT, AMI, and CABG models based on internal analysis from BPCI
episode data that shows higher within-hospital episode spending
variation relative to between-hospital episode spending variation for
episodes anchored by the EPM MS-DRGs, compared to episodes anchored by
MS-DRGs 469 and 470 included in the CJR model.\83\
---------------------------------------------------------------------------
\83\ BPCI Model 2 Baseline Price Common Template calculations
for 90-day episodes in Risk Track B calculates BPCI volume
thresholds based on the ratio of within-hospital episode spending
variation and between-hospital episode spending variation for BPCI
Clinical Episodes, based on episodes that met BPCI eligibility
criteria and that began in July 1, 2009-June 30, 2012.
---------------------------------------------------------------------------
Second, in the case of an EPM participant that has undergone a
merger, consolidation, spin-off, or other reorganization that results
in a new hospital entity without 3 full years of historical claims
data, we proposed that EPM participant hospital-specific historical
EPM-episode payments would be determined using the historical EPM
episode payments attributed to their predecessor(s), as in the CJR
model (80 FR 73544).
The aforementioned proposals align with our method for blending EPM
participant hospital-specific and regional data under the CJR model. We
referred to the CJR model Final Rule (80 FR 73346 through 73349) for
further discussion on alternatives to and reasons for adopting this
methodology for the CJR model, which informed our proposal with respect
to the EPMs.
The proposal for blending payments when establishing participants'
benchmark and quality-adjusted targets and certain exceptions was
included in Sec. 512.300(c)(2), (3), and (4). We note that the
specific order of steps, and how this step fits in with others, is
discussed further in section III.D.4.c. of this final rule. We sought
comment on our proposal for blending payments when establishing
participants' benchmark and quality-adjusted targets as well as the
exceptions.
The following is a summary of the comments received and our
responses.
Comment: Commenters expressed different views on the proposal to
base prices initially on a blend of participant-specific and regional
historical data, while phasing in full regional pricing. Their
perspective commonly related to the proposal to determine regional
prices based on U.S. Census Divisions, which is discussed in section
III.D.4.b.(7) that immediately follows. Some commenters appreciated the
proposal of moving to regional pricing because it would help attenuate
the effect of participants having to compete against their own best
performance and where the most efficient participants in a region could
be rewarded. Moreover, some of these commenters recommended that CMS
even accelerate regional pricing or allow efficient participants the
option to transition from historic to regional target prices at an
accelerated rate. A commenter viewed the proposal as a way to
incentivize both historically efficient and less efficient hospitals to
provide high quality, efficient care.
Response: We appreciate the comments supporting our proposal to
blend payments when establishing participants' benchmark and quality-
adjusted targets and agree with their perceived benefits of the
proposal. We do not agree with suggestions to accelerate regional
pricing or allowing flexibility for hospitals to accelerate their
transition to regional prices. We continue to believe our proposed
phase-in period for regional pricing would generally be most protective
of participants as they adjust to the models because their performance
would be compared to their own historical performance rather than
hospitals in their region. We are also concerned that allowing certain
hospitals the option to accelerate toward regional pricing as was
suggested could affect our estimates
[[Page 316]]
and possibly generate inflated reconciliation payments due to potential
selection issues if historically efficient hospitals were to opt
earlier for a more generous regional price. Allowing certain hospitals
the option to select regional pricing earlier would also increase
administrative complexity under the models.
Comment: Several commenters opposed proposed regional pricing
policy, asking that CMS slow its phase-in period, asking that CMS
phase-in regional prices to something less than 100 percent, for
example, to only a 50-50 blend of participant-specific and regional
pricing, or relying solely on participant-specific performance data.
Some commenters suggested that hospitals might not be prepared to
compete relative to regional pricing while others expressed concern
that hospitals would be penalized for factors beyond their control, for
example, hospitals with a disproportionately large population of high-
cost or vulnerable beneficiaries. Thus, several commenters suggested
that CMS also account for these factors.
Response: As we stated in the CJR Final Rule (80 FR 73348), we
believe that only using participant-specific pricing would not reward
already efficient participants for maintaining high performance and
participants already delivering high quality and efficient care would
find it challenging to improve upon their own historical performance to
quality for reconciliation payments. We appreciate the concerns raised
about participants being penalized for factors beyond their control
once regional prices are phased-in. As discussed earlier in section
III.D.4.b.(2) of this final rule, we will be exploring additional
methods for further risk-adjusting episodes under the models that we
intend to make effective by PY3. We believe that these additional
adjustments in tandem with our general methodology for risk
stratification, caps on high-payment episodes, and limits on Medicare
repayments will offer sufficient protections to participants so that
they are not penalized once regional pricing is phased-in.
Comment: Some commenters noted that even when regional pricing is
fully phased-in, CMS and participants will see diminishing returns over
time, beginning with providers in low-spending areas where more limited
opportunities for additional gains in efficiency exist and target
prices could not be further constrained without putting the quality of
care at risk. Thus, these commenters requested that CMS use the higher
of national or regional historical episode payments when calculating
the target price to help ensure that appropriate incentives are
provided to participants in both high- and low-spending areas. A
commenter recommended that CMS vary pricing based on whether the
participants is in a MSA with higher or lower than average historical
prices. For example, for participants in MSAs with costs well above the
national average, target prices would be based on a blend of
participant-specific data and MSA historical data to help level the
playing field while continuing to allow program savings. For
participants in MSAs already below the national average, CMS should use
a 5-state regional benchmark that would allow high performing MSAs to
drive improvement and achieve savings for CMS and providers.
Alternatively, some commenters recommended that CMS adopt a bifurcated
transition whereby it uses a lower weight for the participants
determined to have spending higher than their region similar to the
Shared Savings Program.
Response: As we stated in the CJR Final Rule (80 FR 73348), we
believe that using the higher of regional and participant-specific
prices would not sufficiently incentivize inefficient participants to
become more efficient. That is, participants with historically high
episode expenditures would have less of an incentive to become more
efficient over the course of a model if they can quality for
reconciliation payments by improving only slightly relative to their
own performance while still being less efficient than their regional
peers.
We appreciate the suggestions to adopt a bifurcated transition or
to vary pricing based on whether the participant is in a MSA with
higher or lower than average historical prices--that is, to base target
prices on a blend of participant-specific data and MSA historical data
in MSAs with higher than average costs and a 5-state regional benchmark
for hospitals in MSAs with lower than average costs, but do not believe
these would materially improve upon our proposed methodology. We
believe the protections we are offering participants are sufficient and
obviate further adjustments such as the ``bifurcated'' transition or
weighting adjustments recently adopted for the Shared Savings Program.
Further, we believe the latter proposal would decrease incentives for
all participants by potentially making it too difficult to achieve
success for participants in higher-spending regions while relaxing
standards for those in lower spending regions.
Comment: Some commenters recommended that, in lieu of regional
pricing targets, CMS adopt national targets. In its comments, MedPAC
noted that national prices are used in other Medicare FFS payment
systems and that it believes the EPMs should transition to national
prices. Further, in 2013, MedPAC reported that risk-adjusted spending
on post-acute care and readmissions varied about 30 percent between
high- and low-spending MSAs for SHFFT episodes. Transitioning to
regionally-based benchmarks, as opposed to nationally-based benchmarks,
will continue to allow large differences in spending across the
country. In markets with long-term care hospitals (LTCH) and inpatient
rehabilitation facilities (IRF), these high-cost settings will raise
the participants' benchmarks. In markets without these providers, on
the other hand, post-acute care is delivered in lower-cost settings and
participants' benchmarks will be lower. MedPAC recommended that CMS
ultimately transition to national benchmarks to exert pressure on high-
cost regions to bring their spending in line with spending in other
markets. Another commenter seemed to suggest that applying nationally-
based benchmarks would help in addressing their concern with disparate
device costs depending on whether a participant was in a rural or
metropolitan area. In their view, participants in rural areas would be
disadvantaged by higher costs for these items.
Response: We agree with MedPAC on the benefits of national prices
as well as their view that national prices should ultimately be adopted
if the EPMs were fully integrated into Medicare on a national basis. We
also continue to believe that our proposal to phase-in regional pricing
from participant-specific prices offers the most appropriate balance of
incentives and protections for purposes of testing the proposed EPMs.
In particular, we are concerned that immediately moving toward national
pricing could impede the chances for success among participants in high
cost regions. As a result, we are reluctant to adopt national pricing
at this time. We also do not agree with the suggestion that moving
toward national pricing would benefit participants in rural areas with
respect to device costs. This is because financial performance,
including spending on devices, during the performance years would be
generally compared to a participant's historical costs or to the
historical costs of providers in their region. In either case, the
costs for
[[Page 317]]
devices should be relatively more comparable than if comparisons were
made to a national measure.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
blend payments when establishing participants' benchmark and quality-
adjusted targets. We would note that our final policy would also
include Sec. 512.300(c)(5) in conjunction with Sec. 512.300(c)(2),
(3), and (4). Thus, the final policy for blending payments when
establishing benchmark and quality-adjusted targets is included in
Sec. 512.300(c)(2), (3), (4), and (5).
(7) Define Regions as U.S. Census Divisions
As we did for the CJR model (80 FR 73349 through 73350), for all 5
performance years, we defined ''region'' as one of the nine U.S. Census
divisions \84\ in Figure 1 (81 FR 50857).
---------------------------------------------------------------------------
\84\ There are four census regions--Northeast, Midwest, South,
and West. Each of the four census regions is divided into two or
more ``census divisions''. Source: https://www.census.gov/geo/reference/gtc/gtc_census_divreg.html. Accessed on April 15, 2015.
\85\ http://www.eia.gov/consumption/commercial/census_maps.cfm.
[GRAPHIC] [TIFF OMITTED] TR03JA17.000
We believe U.S. Census divisions provide the most appropriate
balance between very large areas with highly disparate utilization
patterns and very small areas that would be subject to price
distortions due to low volume or participant-specific utilization
patterns. Our proposed rule also clarified that we would ascribe the
same regional component of EPM-episode benchmark prices for EPM
participants in MSAs that span U.S. Census divisions. That is, selected
MSAs that span U.S. Census divisions would be attributed to one U.S.
Census division for purposes of calculating the regional component of
an EPM-episode benchmark price. Specifically, we would attribute an MSA
to the U.S. Census division in which the majority of people in the MSA
reside.
The proposal to define a region as one of the nine U.S. Census
divisions was included in Sec. 512.300(c)(2). We sought comment on our
proposal to define region in this manner.
The following is a summary of the comments received and our
responses.
Comment: Many of the commenters on the proposed regional definition
expressed concerns about the proposal to blend participant-specific and
regional pricing. In general, the commenters expressed concerns that,
given the size and diversity of the proposed U.S. Census divisions with
respect to health conditions and costs, a single regional price would
potentially not be an accurate measure of a participant's costs. As a
result, those participants that treated sicker patients would be
penalized in particularly large and diverse regions. Thus, many of
these commenters requested that CMS set prices based on a narrower and
more cohesive geographic area, for example, at the MSA level, IPPS wage
index level, or based on MAC regions. A commenter recommended that CMS
not base benchmark prices fully on a regional average but consider
taking into account a participant's relative mix of patients with
respect to CCs and MCCs.
Another commenter suggested that while some financial risk is
captured based on CMS-HCC scores, the best way to remove unintended
consequence is by comparing participants with similar patient
populations, instead of using Census Divisions to calculate target
prices. In their view, using Census Divisions to set target prices
penalizes high acuity hospitals for existing in the same multi[hyphen]
state ``region'' as lower[hyphen]acuity hospitals, even if those
hospitals are more capable at caring for sicker patients. As such, many
hospitals are funneled the most complex AMI, CABG, or fracture cases,
which may increase average costs in a way that is consistent with
providing the highest[hyphen]quality care. As such, this commenter
recommended that CMS instead compare hospitals against other hospitals
with similar patient populations for the purpose of calculating target
prices. As high[hyphen]acuity
[[Page 318]]
referral centers are most at[hyphen]risk given that they treat the most
ill patients in the nation for all of the proposed EPMs, the commenter
recommended that CMS group together such high[hyphen]acuity referral
centers and treat them as their own ``Peer group'' cohort rather than
by region or within each region for the purpose of calculating target
price. This would ensure that locations systematically treating the
most complex cases are being compared appropriately. Another commenter
suggested this concept be expanded more broadly so that peer groups
might be formed around characteristics such as urban teaching
hospitals, suburban hospitals, or small rural hospitals.
Response: We appreciate the comments and concerns raised on our
proposal to base regional pricing on U.S. Census Divisions as well as
the suggested alternatives. Our proposal intended to balance our goal
of identifying relatively cohesive, homogeneous, and meaningful groups
for purposes of establishing benchmark prices with what was
administratively feasible. While we appreciate the suggested
alternatives that were offered and could consider them for future
models, we continue to believe, as we stated in the CJR Final Rule (80
FR 73350), that U.S. Census Divisions provide the most appropriate
balance between very large areas with highly disparate utilization
patterns and very small areas that would be subject to price
distortions due to low volume or hospital specific utilization
patterns. We would also note that as discussed earlier in section
III.D.4.b.(2), we will be exploring additional methods for further
risk-adjusting episodes under the models that we intend to make
effective by PY3. We believe that these additional adjustments will
make comparisons of financial performance among participants more
comparable regardless of a region's diversity.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, without modification, to
define a region as one of the nine U.S. Census divisions. Our final
policy for defining regions is included in Sec. 512.300(c)(2).
(8) Normalize for Provider-Specific Wage Adjustment Variations
Some variation in historical EPM-episode payments across hospitals
in a region may be due to wage adjustment differences in Medicare
payments. In setting Medicare payment rates, Medicare typically adjusts
facilities' costs attributable to wages and wage-related costs (as
estimated by the Secretary from time to time) by a factor (established
by the Secretary) that reflects the relative wage level in the
geographic area of the facility or practitioner (or the beneficiary's
residence, in the case of home health and hospice services) compared to
a national average wage level. Such adjustments are essential for
setting accurate payments, as wage levels vary significantly across
geographic areas of the country. However, having the wage level for one
hospital influence the regional-component of another hospital's EPM
episode-benchmark price with a different level would introduce
unintended pricing distortion not based on utilization pattern
differences.
To preserve how wage levels affect provider payment amounts, while
minimizing the distortions introduced when calculating the regional-
component of blended EPM-episode benchmark prices, we proposed to
normalize for wage indices at the claim level for both historical EPM-
episode payments and actual EPM-episode payments (81 FR 50858). As
discussed in section III.D.3.b. of the proposed rule (81 FR 50845
through 50846), we utilize the CMS Price (Payment) Standardization
Detailed Methodology to calculate EPM-episode benchmark and quality-
adjusted target prices and actual EPM-episode spending. This
methodology removes wage level differences in calculating standardized
payment amounts.
We believe it is important to reintroduce wage index variations
near the end of the EPM-episode price-setting methodology and when
calculating actual EPM-episode payments during an EPM performance year,
to account for the differences in cost for care redesign across
different geographic areas of the country. For example, hiring
additional hospital staff to aid in patient follow-up during the post-
discharge period of an AMI model episode would be significantly more
costly in San Francisco than in rural Idaho. If we do not reintroduce
wage index variations into EPM-episode benchmark price and actual EPM-
episode payment calculations, we would calculate reconciliation and
repayment amounts that would not capture labor cost variation
throughout the country, and EPM participants in certain regions may see
less opportunity and financial incentive to invest in care redesign.
Thus, when setting EPM-episode benchmark prices and calculating actual
EPM-episode payments, we proposed to reintroduce the participant-
specific wage variations by multiplying EPM-episode payments by the
wage normalization factor when calculating the EPM-episode benchmark
prices and actual EPM-episode payments for each EPM participant, as
described in section III.D.4.c. of the proposed rule.
We proposed to use the following algorithm to create a wage
normalization factor: 0.7 * IPPS wage index + 0.3. The 0.7 approximates
the labor share in IPPS, IRF PPS, SNF, and HHA Medicare payments. The
specific order of steps, and how this step fits in with others, is
discussed further in section III.D.4.c. through III.D.4.e. of the
proposed rule (81 FR 50862 through 50864). We also referred to the CJR
model Final Rule for more detailed information on our normalization
process adopted for the CJR model (80 FR 73350 through 73352).
The proposal to normalize for provider-specific wage adjustment
variations was included in Sec. 512.300(c)(12). We sought comment on
our proposal to normalize for these variations.
We received no specific comments on our proposal to normalize for
provider-specific wage adjustment variations other than one in support
of the proposal.
Final Decision: We are finalizing the proposal, without
modification, to normalize for provider-specific wage adjustment
variations. Our final policy for normalizing provider-specific wage
adjustment variations is included in Sec. 512.300(c)(12).
(9) Combining Episodes to Set Stable Benchmark and Quality-Adjusted
Target Prices
For the purposes of having sufficient episode volume to set stable
EPM-episode benchmark and quality-adjusted target prices, we proposed
generally to follow the process from the CJR model (80 FR 73352 and
73353) to calculate severity factors, EPM participant-specific weights,
and region-specific weights that allow us to surmount issues of low
volume for EPM episodes with particular characteristics by aggregating
EPM episodes and portions of EPM episodes across dimensions that
include anchor MS-DRGs, the presence of AMI ICD-CM diagnosis code on
the anchor inpatient claim, and the presence of a major complication or
comorbidity for anchor CABG MS-DRGs (81 FR 50858 through 50861). Where
the CJR Final Rule referred to anchor factors, however, for the
purposes of the proposed rule, we referred to severity factors to avoid
confusion when performing calculations pertaining to expenditures that
occurred during the anchor hospitalization and after the anchor
hospitalization in CABG model episodes.
[[Page 319]]
For SHFFT model episodes, we proposed to combine episodes with
price MS-DRGs 480-482 to use a greater historical episode volume to set
more stable SHFFT episode benchmark and quality-adjusted target prices.
To do so, we proposed to calculate severity factors for episodes with
price MS-DRGs 480 and 481 equal to--
[GRAPHIC] [TIFF OMITTED] TR03JA17.001
The national average would be based on SHFFT model episodes attributed
to any IPPS hospital. The resulting severity factors would be the same
for all SHFFT model participants. For each SHFFT model participant, a
hospital weight would be calculated using the following formula, where
SHFFT model episode counts are SHFFT-model-participant hospital-
specific and based on the SHFFT model episodes in the 3 historical
years used in SHFFT model episode benchmark and quality-adjusted target
price calculations:
[GRAPHIC] [TIFF OMITTED] TR03JA17.002
A SHFFT model participant's specific average episode payment would
be calculated by multiplying such participant's weight by its combined
historical average episode payment (sum of historical episode payments
for historical episodes with price MS-DRGs 480-482 divided by the
number of historical episodes with price MS-DRGs 480-482). The
calculation of the participant weights and the participant-specific
pooled historical average episode payments would be comparable to how
case-mix indices are used to generate case-mix adjusted Medicare
payments. The participant weight essentially would count each episode
with price MS-DRGs 480 and 481 as more than one episode (assuming
episodes with price MS- DRGs 480 and 481 have higher average payments
than episodes with price MS-DRG 482) so that the pooled historical
average episode payment, and subsequently the SHFFT model episode
benchmark and quality-adjusted target prices, are not skewed by the
SHFFT model participant's relative breakdown of historical episodes
with price MS-DRGs 480 and 481 versus historical episodes with price
MS-DRG 482.
We would calculate region-specific weights and region-specific
pooled historical average payments following the same steps as for
hospital-specific weights and hospital-specific pooled average
payments. Instead of grouping episodes by the attributed hospital as
for hospital-specific calculations, region-specific calculations would
group together SHFFT model episodes that were attributed to any IPPS
hospital located within the region. The participant-specific and
region-specific pooled historical average payments would be blended
together as discussed in section III.D.4.b.(6) of the proposed rule.
The specific order of steps, and how this step fits in with others, is
discussed further in section III.D.4.c. of the proposed rule.
Afterwards, the blended pooled calculations would be ``unpooled''
by setting the episode benchmark price for episodes with price MS-DRG
482 to the resulting calculation, and by multiplying the resulting
calculation by the severity factors to produce the episode benchmark
prices for episodes with price MS-DRGs 480 and 481. Applying the
discount factor as discussed in III.D.4.b.(10) and III.D.4.c. of the
proposed rule would result in the SHFFT model quality-adjusted target
prices for episodes with price MS-DRGs 480-482.
For episodes in the AMI model with price MS-DRGs in 280-282 or 246-
251 and without readmissions for CABG MS-DRGs, we proposed to follow an
analogous procedure to the SHFFT model with the following
modifications. First we proposed to group episodes with price MS-DRGs
280-282 separately from episodes with price MS-DRGs 246-251 for the
calculations. Second, we proposed to calculate severity factors for
episodes with price MS-DRGs 280-282 as--
[GRAPHIC] [TIFF OMITTED] TR03JA17.003
Third, we proposed to calculate hospital-specific weights and
region-specific weights for episodes with price MS-DRGs 280-282 as--
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[GRAPHIC] [TIFF OMITTED] TR03JA17.004
Fourth, we proposed to calculate severity factors for episodes with
price MS-DRG 246-251 as--
[GRAPHIC] [TIFF OMITTED] TR03JA17.005
Fifth, we proposed to calculate hospital-specific weights and
region-specific weights for episodes with price MS-DRG 246-251 as--
[GRAPHIC] [TIFF OMITTED] TR03JA17.006
After blending historical and regional pooled episode payments for
episodes with price MS-DRGs 280-282, the blended pooled calculations
would be ``unpooled'' by setting the episode benchmark price for price
MS-DRG 282 to the resulting calculation, and by multiplying the
resulting calculation by the severity factors to produce the episode
benchmark prices for price MS-DRGs 280 and 281.
After blending historical and regional pooled episode payments for
episodes with price MS-DRGs 246-251, the blended pooled calculations
would be ``unpooled'' by setting the episode benchmark price for price
MS-DRG to the resulting calculation, and by multiplying the resulting
calculation by the severity factors to produce the episode benchmark
prices for price MS-DRGs 246-251.
Applying the discount factor as discussed in III.D.4.b.(10) and
III.D.4.c of the proposed rule would result in the quality-adjusted
target prices for price MS-DRGs 280-282 and 246-251.
For episodes in the CABG model with price MS-DRGs in 231-236, we
proposed to calculate severity factors, hospital-specific weights, and
region-specific weights separately for the anchor hospitalization
portion of CABG model episodes and the post-anchor hospitalization
portion of CABG model episodes.
For the anchor hospitalization portion of CABG model episodes, we
proposed to follow an analogous procedure to the SHFFT model with the
anchor hospitalization portion of CABG model episodes grouped by the
price MS-DRG. Specifically, we proposed to calculate anchor
hospitalization severity factors for price MS-DRGs 231-235 as--
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[GRAPHIC] [TIFF OMITTED] TR03JA17.007
We also proposed to calculate participant-specific weights and
region-specific weights for the anchor hospitalization portion of CABG
model episodes as--
[GRAPHIC] [TIFF OMITTED] TR03JA17.008
After blending historical and regional pooled anchor
hospitalization payments for the CABG model episodes, the blended
pooled calculations would be ``unpooled'' by setting the price MS-DRG
236 anchor hospitalization benchmark price to the resulting
calculation, and by multiplying the resulting calculation by the
severity factors to produce the anchor hospitalization benchmark prices
for price MS-DRGs 231-235.
For the post-anchor hospitalization portion of CABG model episodes,
we proposed to follow an analogous procedure to the SHFFT model with
the post-anchor hospitalization portion of CABG model episodes grouped
in the following manner--
With AMI diagnosis on the anchor inpatient claim and price
MS-DRG with major complication or comorbidity (231, 233, or 235)
With AMI diagnosis on the anchor inpatient claim and price
MS-DRG without major complication or comorbidity (232, 234, or 236)
Without AMI diagnosis on the anchor inpatient claim and
price MS-DRG with major complication or comorbidity (231, 233, or 235)
Without AMI diagnosis on the anchor inpatient claim and
price MS-DRG without major complication or comorbidity (232, 234, or
236)
Specifically, we proposed to calculate post-anchor hospitalization
severity factors as--
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[GRAPHIC] [TIFF OMITTED] TR03JA17.009
We also proposed to calculate hospital-specific weights and region-
specific weights for the post-anchor hospitalization portion of CABG
model episodes as--
[GRAPHIC] [TIFF OMITTED] TR03JA17.010
After blending historical and regional pooled post-anchor
hospitalization payments for the CABG model episodes, the blended
pooled calculations would be ``unpooled'' by setting the without AMI
ICD-CM diagnosis code on the anchor inpatient claim and price MS-DRG
without major complication or comorbidity (232, 234, or 236) post-
anchor hospitalization benchmark price to the resulting calculation,
and by multiplying the resulting calculation by the severity factors to
produce the post-anchor hospitalization benchmark prices for:
With AMI diagnosis on the anchor inpatient claim and price
MS-DRG with major complication or comorbidity (231, 233, or 235)
With AMI diagnosis on the anchor inpatient claim and price
MS-DRG without major complication or comorbidity (232, 234, or 236)
Without AMI diagnosis on the anchor inpatient claim and
price MS-DRG with major complication or comorbidity (231, 233, or 235)
We proposed to calculate episode benchmark prices for CABG model
episodes by summing combinations of CABG anchor hospitalization
benchmark prices and CABG post-anchor hospitalization benchmark prices.
Applying the discount factor as discussed in III.D.4.b.(10) and
III.D.4.d of the proposed rule would result in the quality-adjusted
target prices for CABG model episodes.
For episodes in the AMI model with CABG readmissions, we proposed
to perform no additional blending of participant-specific and regional-
specific episode payments. We proposed to calculate the AMI model
episode benchmark and quality-adjusted target prices for such episodes
as described in section III.D.4.e. of the proposed rule.
The proposals to combine episodes to set stable benchmark and
quality-adjusted target prices were included in Sec. 512.300(c)(13).
We sought comment on our proposals for combining episodes for these
purposes.
We received no comments on our proposals for combining episodes.
Final Decision: We are finalizing the proposal, without
modification, to combine prices for episodes. Our final policy for
combining episodes is included in Sec. 512.300(c)(13). We would note
that since we did not finalize our proposal for price MS-DRGs, the term
price MS-DRG is excluded and replaced with the term anchor MS-DRG.
(10) Effective Discount Factor
As discussed in section III.D.2.c. of the proposed rule, we
proposed to make EPM participants partly or fully accountable for EPM-
episode payments in relationship to the EPM quality-adjusted target
price (81 FR 50844). As part of this, in setting an episode quality-
adjusted target price for an EPM participant, we proposed to apply an
effective discount factor to an EPM participant's participant-specific
and regional blended historical EPM-episode payments for a performance
period. We expect EPM participants to have a significant opportunity to
improve the quality and efficiency of care furnished during episodes in
comparison with historical practice, because the EPMs would facilitate
the alignment of financial incentives among providers caring for EPM
beneficiaries. Our proposed effective discount factors were intended to
serve as Medicare's portion of reduced expenditures from an EPM episode
with any EPM-episode expenditures below the quality-adjusted target
price potentially available as reconciliation payments to the EPM
participant where the anchor hospitalization occurred.
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For the EPMs, we proposed to establish a 3 percent effective
discount factor to calculate the quality-adjusted target prices for EPM
participants in the below acceptable and acceptable quality categories,
as discussed in section III.E.3.f. of the proposed rule (81 FR 50887
through 50893) and similar to the CJR model (80 FR 73355). The
effective discount factor to calculate the quality-adjusted target
price for EPM participants in the good and excellent quality categories
would be 2 percent and 1.5 percent, respectively.
As discussed in section III.D.2.c. of the proposed rule (81 FR
50844), because of the proposed phase-in of repayment responsibility
with no responsibility in either performance year 1 or performance year
2 (NDR) and only partial repayment responsibility in performance year 2
(DR) and all of performance year 3, an EPM participant with actual EPM-
episode payments that exceeded the quality-adjusted target prices
multiplied by the EPM participant's number of EPM episodes to which
each quality-adjusted target price would apply in performance year 2
(DR) and performance year 3 would owe Medicare less than would
otherwise result from this calculation.
Also, as discussed in section III.E.3.f of the proposed rule (81 FR
50801), we proposed to apply an ``applicable discount factor'' to
repayment amounts in performance years 2 and 3 while this repayment
responsibility was being phased-in. We refer to section III.E.1. and
specifically Tables 20 through 28 in our proposed rule for further
illustration of the discount percentages that would apply for
reconciliation payment and Medicare repayment over the 5 EPM
performance years (81 FR 50888 through 50892). We believe this
methodology offers EPM participants an opportunity to create savings
for themselves and Medicare, while also maintaining or improving
quality of care for EPM model beneficiaries.
The proposal to establish discount factors that would apply to the
quality categories was included in Sec. 512.300(d). We sought comment
on our proposal to establish discount factors that apply to the quality
categories.
The following is a summary of the comments received and our
responses.
Comment: Most commenters suggested that the ability to achieve
savings under the proposed models (most notably for the cardiac models
and the CABG model in particular) was more limited than for the CJR
model, and that these limitations would become more significant as
target prices decline further over time. For example, commenters opined
that while about half of CJR episode spending is attributable to the
initial hospitalization, CMS noted that about three-quarters of CABG
episode spending is attributable to the initial hospitalization. As
such, there are fewer opportunities to achieve efficiencies within the
inpatient hospital payment amount because it is a predetermined per-
discharge payment based primarily on the patient's condition, not on
services provided. Further, some portion of CABG and AMI costs outside
the initial hospitalization is attributable to readmissions; however,
these costs are already declining due to hospitals' responses to the
HRRP and any remaining readmissions are more likely to be clinically
appropriate and necessary. As such, it would be difficult to achieve
efficiencies within the remaining percentage of spending that occurs
outside the initial hospitalization. Thus, commenters requested that
CMS implement a smaller discount factor than what was proposed--
typically a 1 percentage point reduction.
Response: We appreciate the comments and concerns raised with
respect to our proposed discount factor. We recognize that, as compared
to episodes under the CJR model, opportunities to achieve improved
efficiencies under the proposed models would be different and
potentially more challenging for participants under the proposed
models. However, we do not believe the increased efficiencies needed to
be successful as was proposed under the models are unattainable. Given
our policy to phase-in full regional pricing over time, participants'
performance will increasingly be compared to that of peers within their
region; thus, for the more efficient participants, target pricing would
likely be higher than if we relied on participant-specific pricing
alone. Further, as discussed in section III.D.4.b.(2), we plan to
explore and implement additional adjustments for risk beginning in PY3,
which should facilitate successful participants' ability to achieve
savings under the models. We would also note that our final policy to
include reconciliation payments when updating target prices for
successful participants under the models should ease the decline in
pricing over time, which should facilitate their ability to be rewarded
for improved efficiencies.
Comment: A commenter encouraged CMS to provide participants with
protection against having to make repayments that result from adverse
events beyond their control, similar to the protections offered under
the Medicare Shared Savings Program. Specifically, during risk-bearing
periods of the program, instead of setting a repayment target price
equal to historical payments minus some percentage, the commenters
recommended that CMS should instead set a symmetric target price equal
to historical payments plus or minus some percentage. Under this
proposal, participants with historical payments falling between, for
example, 97 percent and 103 percent of historical payments would
neither receive reconciliation payments nor be held responsible for
repaying Medicare.
Response: We appreciate the suggested alternative the commenter
offered, but would note that the proposed models are intended to test a
bundled payment rather than a shared savings model, which is being
tested through Innovation Center and Shared Savings Program ACO
efforts.
Final Decision: After consideration of the public comments
received, we are finalizing the proposal, with modification, to
establish discount factors that would apply to the quality categories.
Specifically, for repayment amounts in performance year 2, our final
applicable discount factor would apply only to participants that
elected downside risk in that year. Also, in conformance with our final
policy for phasing-in repayment responsibility, the applicable discount
factor is extended so that it will apply to all EPM participants in
performance year 4. Our final policy for the discount factor is
included in Sec. 512.300(d).
c. Approach To Combine Pricing Features for All SHFFT Model Episodes
and AMI Model Episodes Without CABG Readmissions
The following presents our proposed methodology for combining the
pricing features presented in section III.D.4.b. of the proposed rule
with respect to SHFFT model episodes and AMI model episodes without a
CABG readmission (81 FR 50862 and 50863).
Step 1--Calculate historical EPM-episode payments for
episodes that were initiated during the 3-historical-years of each
applicable EPM (that is, individually for each of the SHFFT and AMI
models) (section III.D.4.b.(3) of the proposed rule) for all IPPS
hospitals for all Medicare Part A and B services included in the EPM
episodes. Limit the potential AMI model episodes to those episodes with
price MS-DRGs in 280-282 or 246-251 and without readmissions for CABG
MS-DRGs. We note that specific PBPM payments may be excluded from
historical EPM-episode payment calculations as
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discussed in section III.D.6.d. of the proposed rule.
Step 2--Remove the effects of special payment provisions
(section III.D.3.b. of the proposed rule) and normalize for wage index
differences (section III.D.4.b.(8). of the proposed rule) by
standardizing Medicare FFS payments at the claim-level.