The Big Six: Significant Events Impacting Heart Programs in 2015 and Beyond

Posted by: Larry Sobal on Thursday, December 31, 2015

The end of a year is a good time to reflect. So, let's take stock of what happened that played some significance for heart programs in 2015. But don't think of this as just another “2015 top whatever” list. This is really a segue for my blog next week where I will spell out what heart programs need to focus on in 2016 (and beyond) to be successful.

The challenge is that in a world where everything seems to be over-analyzed, over-hyped, over-publicized, and (too often) over-criticized, it can be hard to separate things that really matter from those that are just important or of little consequence. It is with that context that I chose six things from 2015 that I think were big deals. You can judge for yourself. And for the record, these are not listed in any particular order of importance.

1. SGR Fix

On Thursday, April 16, President Obama signed into law the legislation ending and replacing the Sustainable Growth Rate (SGR) Formula, which would have reduced Medicare physician payments by 21 percent. Under SGR, Medicare's budget was calculated by linking Medicare spending to economic growth. However, once health care costs began rising faster than the growth of the economy, physicians were at continual risk for cuts to their reimbursements. For over a decade, Congress passed temporary “doc fixes” to keep the reimbursements steady. The new legislation eliminates the need for repeated fixes by repealing the SGR law and replacing it with a new system that eventually ties payments to participation in value-based payment models. Most of the changes are not slated to take effect until 2019. Doctors will receive an annual update of 0.5 percent in each year 2015 through 2019.

The implications of this repeal are enormous, as this has been an ominous cloud hanging over medical practices for a decade. Enactment of a 21 percent reimbursement decrease would have been devastating in many ways and a fix was necessary.

2. MACRA

You can't mention the SGR repeal without MACRA, short for the Medicare Access and CHIP Reauthorization Act of 2015. Section 101 of MACRA repealed the Medicare SGR formula affecting the Medicare Physician Fee Schedule (MPFS) and replaced it with a new Merit Based Incentive Payment Schedule (MIPS) while sun setting and consolidating the current Physician Quality Reporting System (PQRS), the Value-Based Modifier (VM) and the Medicare Electronic Health Record (EHR) Incentive. This legislation also encourages the development of new Alternative Payment Models (APMs) that would exempt physicians from assessment under MIPS, and provide bonus payments.

Aside from adding to our impressive list of acronyms, the implications of MACRA are not yet clear. Since not all of the formulaic components have been fully defined, all we can say is that this is a distinct move toward reimbursement that incorporates various aspects of quality and cost performance.

3. Heart Failure Drugs

This past summer the FDA approved the heart failure drug sacubitril/valsartan (Entresto), previously known as LCZ696. There had been no new heart failure drugs for a decade until ivabradine (Corlanor) ended the drought last April. The excitement was more palpable with LCZ696, called a game-changer for not only reducing heart failure hospitalizations like ivabradine but also preventing heart failure deaths.

In a world where everything seems to be over-analyzed, over-hyped, over-publicized, and (too often) over-criticized, it can be hard to separate things that really matter from those that are just important or of little consequence. Here are six things from 2015 that I think were big deals.

I'm not qualified to say whether or not this will impact readmissions, but if so that would be significant as, once again, the majority of the nation's hospitals are being penalized by Medicare for having patients frequently return within a month of discharge (often related to heart failure), this time losing a combined $420 million, government records show. In the fourth year of federal readmission penalties, 2,592 hospitals began receiving lower payments for every Medicare patient that stays in the hospital—readmitted or not—starting in October. The Hospital Readmissions Reduction Program, created by the Affordable Care Act, was designed to make hospitals pay closer attention to what happens to their patients after they get discharged.

4. IOM Report

In September, the Institute of Medicine (IOM) released the report Improving Diagnosis in Health Care, a continuation of the landmark Institute of Medicine reports To Err Is Human: Building A Safer Health System (2000) and Crossing the Quality Chasm: A New Health System for the 21st Century (2001). This latest report called out that diagnosis—and, in particular, the occurrence of diagnostic errors—has been largely unappreciated in efforts to improve the quality and safety of health care.

The result of this inattention is significant: The committee concluded that most people will experience at least one diagnostic error in their lifetime, sometimes with devastating consequences. Urgent change is warranted to address this challenge. With so many different physicians being involved in a heart patient's care as they travel across the continuum, not to mention limited interoperability between EMRs that impeded communication, the potential for error in diagnosis certainly exists.

5. ICD -10

Transitioning to the International Classification of Diseases, 10th Revision (ICD-10) for the October 1, 2015 deadline was a major effort for both payors and providers. After a few delays, the 2015 launch of ICD-10 codes promised many benefits and returns on your efforts, such as capturing more precise health care information and bringing the United States in step with coding systems worldwide.

ICD-10 undoubtedly changes the landscape of coding, and the effects will be felt in every arena of the revenue cycle. The conversion will impact almost every aspect of operations, data analysis, and reporting as well as a number of information technology (IT) systems that use diagnostic and procedural information. In addition, charging and pricing, physician documentation and buy-in, computer systems, electronic order entry, clinical documentation improvement, and computer-assisted coding are all affected by the implementation of ICD-10.

6. CMS Strategy

In November, CMS announced its new Medicare quality plan, the first update since June 2014. In it, CMS clarified its strategy for moving away from fee-for-service payments and said by the end of next year, 85 percent of all traditional Medicare payments to quality of value and 30 percent of traditional Medicare payments should be tied to alternative payment models (i.e. bundled payments or ACOs). The goals rise to 90 percent and 50 percent, respectively, by 2018.

The update aligns with the National Quality Strategy in two major highlighted areas. One, CMS lays out a three-pronged mission for itself including: improving overall quality of care by centering care on the patient, and making it more reliable, accessible and safe; addressing behavioral, social and environmental influences on health and supporting proven solutions to provide better care; and reducing health care costs across the board from individuals to businesses to communities and the government.

CMS also laid out six specific goals they hope will drive that mission: Reduce harm caused while delivering care, strengthen personal and family engagement together in care, effective communication and coordination of care, treatment and prevention of chronic disease, promote healthy living in communities and make care affordable.

There you have it, my top six for 2015. What would you argue should have been included? Next week I will focus on the key questions that heart programs should be asking themselves in preparing for success in 2016.

 


Larry SobalLarry Sobal is Executive Vice President of Business Development at MedAxiom. He has a 35-year background as a senior executive in medical group leadership, hospital leadership and insurance. As part of his current role, Larry consults, writes and presents on topics relevant to transforming physician practices and health systems.

 

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