Transcript E-Rx Released August 31, 2011

What’s New In Washington and Baltimore…
POHMS Annual Fall Conference
November 3, 2011
John Akscin, Vice President and Customer Advocate
The Landscape is Changing
Quickly…Will You?
Top 10 Things to Watch for in 2011
Accuracy of MC Fee Schedule
PQRS
Red Flag Rule
Implementation of ACA
Medicare Provisions
EHR Incentive
Oversight/Compliance
E-Rx Prep for 2012
Prep HIPAA V-5010
CMS Rule on ACOs
Advocacy SGR Reform
Source: MGMA January 2011
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Medicare
Private
Payors
Market Based What Guidelines
Solutions
Cost Shifting
3rd
Party
Players
ACOs
Regulatory
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BCA 2011
The US borrows 40 cents to cover each dollar spent
White House and Congress need to Reduce Budget by $1.2 T
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Increases current debt limit by $917B
Allows the Fed Gov to operate 5-7 months
Establishes caps on discretionary spending for the next 10
years (does not affect Medicare)
Gives Congress additional time to draft and pass long term
solutions for and additional savings of up to $1.5T
• To be passed and signed by the President by January 2012
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Establishes the “Super Committee”
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Super Committee
Congressional Joint Select Committee on Deficit Reduction
Tasked with proposing legislation focused at reducing long-term
debt another $1.2 to $1.5T over the next 10 years
Senate Republicans:
Senator Jon Kyl (R-Ariz.)
Senator Pat Toomey (R-Pa.)
Senator Rob Portman (R-Ohio)
Senate Democrats:
Sen. Patty Murray (D-Wash.)
Sen. Max Baucus (D-Mont.)
Sen. John Kerry (D-Mass.)
House Democrats:
Rep. Jim Clyburn (D-S.C.)
Rep. Chris Van Hollen (D-Md.)
Rep. Xavier Becerra (D-Calif.)
House Republicans:
Rep. Jeb Hensarling (R-Texas)
Rep. Dave Camp (R – Mich.)
Rep. Fred Upton (R-Mich.)
Target for completion…November 23rd
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What Does MedPAC Say?
– MedPAC recommendations for the Medicare
Physician Payment fix were tough on specialists
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MedPAC would replace the current SGR formula with 10 years
of statutory fee schedule updates that the commission estimates
would cost Medicare $200 billion -- compared with the $300
billion cost of freezing physician pay at current rates
To pay for that $200 billion cost MedPAC developed offsets that
the commission estimates to equal $235 billion.
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Recommendations for an 18 percent cut in payments to specialists
over the next three years followed by a freeze for seven years.
Medicare payments to primary care physicians would be frozen for
10 years
Source: MedPAC Report to Congress Septeimber 2011
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And The White House…
 President Obama’s blueprint for deficit reduction…a recommendation to the
Congressional Joint Committee
– $248 billion in Medicare cuts but do NOT include a reduction in Medicare
reimbursement for Part B drugs below ASP + 6%.
 The President’s recommendations do include proposals to:
– further reduce Medicare payments to physicians for advanced imaging (CT, MRI);
– require Medicare to institute a prior authorization for advanced imaging services (CT,
MRI, PET);
– eliminate Medicare payment adjustments for rural hospitals and physicians;
– increase certain Medicare beneficiary premiums, co-pays and cost-sharing
provisions;
– require pharmaceutical companies to charge less for low-income Medicare
beneficiaries at the Medicaid price; and
– reduce Medicare payments for hospital bad debt and medical education.
Source: MGMA January 2011
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And The White House…
 The $248 billion in Medicare reductions comes in a package that is
estimated to reduce the federal budget deficit by $3 trillion over the
next ten years (in addition to the $1.2 trillion in reductions included in
the Budget Control Act). Outside of the Medicare/health care arena,
the President proposes $1.5 trillion in additional tax revenues, in part
by:
 allowing the expiration of the Bush tax cuts;
 creating a new millionaire’s tax;
 scaling back itemized deductions for individuals making over $200,000 and joint
filers making over $250,000;
 taxing carried interest at ordinary income rates;
 eliminating the Last-In, First-Out (LIFO) tax accounting method.
 While it is good that ASP is not on this particular recommendations
list, there is a long way to go before this matter is resolved we will
certainly need your continued engagement over the coming weeks and
months.
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Senator Kohl’s bill…
Kohl (D-WI) - Chair of the Senate Committee on Aging
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Restructure ASP to incentivize use of generic drugs
Establish a Medicare Part B drug rebate program similar to
Medicaid
Allow the Secretary of HHS to negotiate pricing on Part B
drugs where the government is the “majority purchaser”
Re-establish “least costly alternative” as the payment model
for Part B drugs that are essentially “equivlavent”
Establish a study and report on physician reimbursement for
Part B drugs including
• Ability of physicians to afford and profit on drugs under the current ASP+6%
model
• Rate at which physicians use a higher priced drug when there is a lower cost
alternative
• The feasibility of lower cost drug reimbursement models not based on price
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What This Means to You…
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For now, ASP+3% is back on the table
If Congress does not provide a long term solution a
provision reducing entitlement spending could be
triggered affecting Medicare providers but not
beneficiaries directly
All spending will be fair game to the Super
Committee including Part B drugs, physician
payments and hospital payments
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3.5 Things You Should be Doing…
1.
Work with your professional societies and associations in
contacting Congress asking them to oppose any reductions in
Medicare spending for Cancer Care
2. Key committees of jurisdiction submitted their
recommendations on October 15th. The work accelerates
exponentially in order to hit the target of November 23rd so be
alert to advocacy efforts
3. Continue to stay tuned to MHS for periodic updates and
information to stay informed
3.5 Engage!
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Drug Shortages
What is Happening?
 Generic products represent over 78% of prescription Rx
dispensed or administered in the USA
 The are now over 230 drugs in short supply, a four fold
increase since 2004 when there were 58 drugs in short supply.
 From cancer treatments to surgical sedatives to standard ER
remedies, many pharmaceuticals are in short supply according to
doctors, hospitals, pharmacies, advocacy groups, and the FDA.
 Shortfalls are more frequent and prolonged
Why is this Happening?
 Industry consolidation
 Random and unpredictable manufacturing
problems
 Scarcity of raw materials
 Quality Control issues
 Simple economics
 Thin margins in generic drugs have eliminated
manufacturers (some have decreased >50% since 2005)
 Almost no new generic manufacturers entering this space
 shortfalls of key medications are more frequent and
prolonged
“Worst drug shortage in more than
30 years…”
 Many of the drugs in short supply are sterile injectables
 So how bad is it?
 Michael Link, MD, president-elect of the American Society of
Clinical Oncology "This is probably the worst drug shortage
in more than 30 years."
 The FDA has few tools to resolve shortages:
 It can’t order drug companies to make more drugs
 It does plan to accelerate approval processes in situations of
shortages.
 It also has plans to clear non-licensed drugs from overseas that
are similar to today’s scarce medications.
Generic Drug Sourcing…
What can the Distributors Do?
 In the short term:
Continue to work hard to get as much inventory as
possible based upon product availability (which is not
always within our control)
Communicate alternative treatments
Assure that the amount of products we do have are
fairly allocated
Staying Engaged with the Industry
 In the mid term:
Through collaboration with HDMA, specialty distribution is
continuing its advocacy efforts with professional associations
including HDMA, ASCO, ASHP, ASA and the Institute for
Safe Medicine Practices
This coalition recently held a drug shortage summit with the
FDA to explore strategies to manage and mitigate product
shortages
ASHP is finalizing a report to be available to coalition
members
HDMA is working on updating a report that was issued a few
years ago on product availability
Finding Long Term Solutions
 The Long term:
Further diversify supplier portfolios to better serve our
customers and their patients
Identify and engage “secondary” suppliers for all key products
that meet safety and credibility standards
Drug Shortage Legislation
HR-2245, Degette
S-296, Klobuchar
– All Rx including Biologics
– Significant penalties for not
reporting
– HHS gets to set “evidence
based” criteria
– HHS to collaborate with
stakeholders (WD’s SD’s)
to assure continuity of
supply
– Requires FDA to report to
Congress
– Rx excluding Biologics
– No penalties
– HHS gets to set “evidence
based criteria
– No such provision
– No such requirement,
however OIG/GAO to
study and report
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What Else…
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HHS Kathleen Sebelius hosts hearings on Gray Market
House E&C Health Sub-Com testimony
FDA one day workshop
Congressman Elijah Cummings, D-MD launches investigations of
Gray Market and 5 regional distributors for price gouging
Significant penalties for not reporting
HHS preparing to set “evidence based” criteria
HHS to collaborate with stakeholders (WD’s SD’s) to assure
continuity of supply
Premier Healthcare Alliance Report on Gray Market
Require FDA to report to Congress on solutions
Renewed discussion of Federal pedigree legislation is imminent
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The Executive Order…
– Direct FDA to broaden reporting of potential shortages of certain
prescription drugs;
– Require FDA to expand its current efforts to expedite review of
new manufacturing sites, drug suppliers, and manufacturing
changes;
– Direct FDA to work with the Dept. of Justice to example reports of
price gouging.
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The President Also…
– Sent a letter to manufacturers reminding them of their legal
responsibilities to report discontinuation of certain drugs to the
FDA and encourages companies to voluntarily notify FDA about
potential shortages in cases where notification is not required.
– Indicated support for increasing staffing at FDA’s Drug Shortages
Program to address the increased workload for additional
notifications
– Released two reports examining drug shortages (ASPE and FDA)
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Be Careful Out There…
Senator Michael Bennett (D-CO) sends letter to Margaret Hamburg
Drug pedigree tracking is critical to watch dog effort
“Grey market” schemes are worrisome
OIG action catches Maryland physician for “introducing missbranded drugs into intrastate commerce”
Physician plead guilty
Criminal investigation discovered this “cancer doctor”
Purchased >$200,000 in drugs from an illegal European
distributor
Billed the government (Fed and State) almost $800,000 for these
drugs administered to patients in the clinic’s infusion center
Remember…if the deal is too good to be true…it probably is!
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Proposed Rule v Final Rule 2012 MC-PFS
Component
Proposed Rule Provision Final Rule Provision
Released August 30, 2011
Released Nov 2, 2011
Payment Reduction
29.5%
27.4%
Conversion Factor
$23.9635
$24.6712
3rd year of 4 year phase
in
Same
50%
25%
Currently $33.9764
PE RVU Changes
Adv Dx Imaging
Reduction
2012 E-Rx targets for
Groups
Total affected practices
25-99 EPs = 625 events
>100 EPs = 2500 events
865
CMS PR and FR Published as Noted
1042
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Potential Impact (Assuming no change in CF)
Specialty
Proposed Rule Provision
Final Rule Provision
Released August 30, 2011
Released Nov 2, 2011
Hem-Onc
0.0%
0.0%
Rad-Onc
-4%
-6%
Dx Radiology
-4%
-3%
3rd year of 4 year phase in
Same
50%
25%
PE RVU Changes
Adv Dx Imaging Reduction
25-99 EPs = 625 events
>100 EPs = 2500 events
2012 E-Rx targets for
Groups
Drugs
ASP+6%
Drugs Alternative Pricing AMP+3% Where drug is lower
than 5% less than 5% less than
Model
ASP+6%
HOPD ASP+4%
Same
ASP
CMS PR and FR Published as Noted
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Proposed Rule 2012 MC-PFS
Impact to specialties as projected by CMS without a CF change
Hem-Onc = 0%
Rheumatology = 0%
Urology = 0%
Gastroenterology = 0%
Dermatology = 0%
Rad Onc = - 4%
Dx Imaging = - 4%
*2012 is year 3 of the 4 year phase in of RVU changes
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Meaningful Use, Stage 2
The HITPC has heard from both the vendor community and the provider community
that the current schedule for compliance with stage 2 meaningful use objectives
in 2013 poses a nearly insurmountable timing challenge for those who attest to
meaningful use in 2011. With the anticipated release of the final rule for stage 2
in June, 2012, it would require EHR vendors to design, develop, and release
new functionality
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Final Recommendations from Health IT PB
•
Delay Stage 2 implementation until 2014
•
*Dr. Mostashari, NC-HIT says…don’t worry about Stage 2
MU now…we will deal with it through a Proposed Rule by
Q2-2012 followed by a Final Rule in Q4 2012. Therefore we
will hold implementation until 2014
*Statement by Dr. Mostashari at the 2011 MGMA National Conference in Vegas Last Week
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EHR Registration and Attestation
1. Registration Page
a) https://ehrincentives.cms.gov/hitech/login.action
b) EPs must obtain “proxy: for Prac Admin’s to register and attest
c) If you plan to participate in 2011, you must be registered by
2/29/2012
2. Reporting will be by attestation and subject to audits
3. Registrations and interest is getting traction, CMS as of 9/30/11
a) >114,600 EPs active registrations in MC/MD programs
b) >$514m paid out in Medicaid
c) >$357m for year 1 “early adopter’s” paid out
Practice Administrators may Register and Attest on behalf of the
groups EPs. The PA must have an Access and Identity ID issued
by CMS. We will provide the link to the CMS page
Source: CMS EHR Web pages, Spotlight
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More on Payment Model EHR…
1. A reporting year is a calendar year
2. First year participation will require reporting at least 90 days of
continuous use ending within the reporting year
a) 2011 or 2012, must report Oct, Nov & Dec to receive bonus
3. Successive years must be full years
4. Successful EPs participate for up to 5 years with payments
beginning as early as 2011 and ceasing after 2016
5. Remember, if you are not participating by 2015 your MC
payments will be decreased by 1% and increase yearly
6. No double dipping with E-Rx incentives
Source: CMS Fact Sheet EHR Incentive Program
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Provider Incentive Programs – Physician
Medicare incentive program…Part B claims method
CY 2011
Start
CY 2012
Start
CY 2013
Start
CY 2014
Start
CY 2015
and
after
CY 2011
$18,000
CY 2012
$12,000
$18,000
CY 2013
$ 8,000
$12,000
$15,000
CY 2014
$ 4,000
$ 8,000
$12,000
$12,000
CY 2015
$ 2,000
$ 4,000
$ 8,000
$ 8,000
$0
CY 2016
None
$ 2,000
$ 4,000
$ 4,000
$0
Total
$44,000
$44,000
$39,000
$24,000
$0
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Source: CMS FR Meaningful Use for HiTech ARRA, July 13, 2010
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5.5 Other Tidbits
2009 PQRI
1.
Success rate for Claims Based Reporting ~50%
2.
Success rate for Registry Reporting ~90%
3.
Success rate for Registry Reporting in Group model ~95%
4.
ER Physicians and Anesthesiologists had highest success rates
(>70%)
5.
% of EPs using Registry reporting doubled from 7.5% in 2008 to 15%
in 2009
5.5
EPs using Registry reporting had, on average, a 49.7% higher
payment than EPs using Claims Based reporting
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Medicare Contractors Making Payments
2010 E-Rx and PQRI
CMS reports MC Contractors have completed making payments to
successful EPs for 2010 E-Rx participation
Payments are complete and are averaging ~$8,300 per EP (ERA will
be coded LE “RX10”
Reports are available for download
MC Contractors are making payments to successful EPs for 2010
PQRI participation
Reports will be available for download soon
(~$8,800/EP in
procedure intensive specialties)
Payments will be coded on the ERA as
LE “PQ10”
Remember…Reports are issued by the EPs NPI, and payments are
made to the Tax ID of the group entity
Source: CMS E-Rx and PORS Web Pages Updated October 15, 2011
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Final Rule for MC – E-Rx
Released August 31, 2011
Clarifies payment reductions for not successfully
participating:
1.0% reduction effective 1/1/2012
1.5% reduction effective 1/1/2013
2.0% reduction effective 1/1/2014
Reports will not be available for download until September
Modifies the descriptor statement for the E-Rx QM to include:
Use of an applicable freestanding E-Prescribing
technology…or
Use of an EHR “certified” by one of the organizations
approved by ONC
Source: CMS FR E-Prescribing Published August 31, 2011
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Final Rule for MC – E-Rx
Continued…
 Expands the “hardship” exemptions for 2012 to include
EPs that:
1. Are located in a rural area w/o access to high speed internet
2. Are located in an area w/o sufficient pharmacies available to
accept E-Rx
3. Register to participate in the MC or MD EHR program and
adopt ONC certified EHR technology
4. Are not able to E-Rx due to local, state or federal law
5. Have very limited prescribing activity
6. Are limited by the E-Rx “denominator” requirements
 Extends the deadline to apply for these “hardship”
exemptions to November 8, 2011
Source: CMS FR E-Prescribing Published August 31, 2011
And Updated by CMS November 2, 2011
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Woops…We have a bug!
 CMS Bug in E-Rx Exemption Request Web Page
1. A bug was detected in the web page
2. The bug only affected those requesting the EHR hardship
exemption
3. On Sept 30th CMS announced the bug has been repaired
4. The bug was in field the field which requires you to enter your
15 digit EHR certif #...but the field was only for 13 characters
 So if you have any concerns contact the
1. Qualitynet help desk at qnetsupport.sdps.org
1. CMS will contact EPs to assure their exemption request has been
received and processed
Source: CMS Web Page E-Prescribing Exemptions Updated October 1, 2011
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Must be completed by 1/1/2012
–One of 3 accrediting agencies (ACR, IAC, TJC)
• ACR will electronically transmit to CMS after
1/1/2012
• You still have to update you CMS 855R to
– Lock in the “Adv Dx Imaging” provider specialty code 95
– List the advanced imaging procedures you will be
providing
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http://www.innovations.cms.gov/areas-of-focus/patient-caremodels/bundled-payments-for-care-improvement.html
 August 23, 2011, CMS issued a FR on the Bundled Payment Initiative through
CMMI
 Invites providers to apply and assist in testing and developing four models of bundling
payments.
 Bundled payments would be the net payment mechanism for a patient receiving a single
episode of care, such as a total hip replacement, and all of the providers, such as the physician,
hospital and other healthcare providers coordinating care for the patient when they are in the
hospital and after they are discharged.
 Unlike the UHC model, under the new concept by CMMI, providers would have the
flexibility to define which episodes of care and which services would be bundled
together.
 Providers also have the option of dividing the proceeds as they want.
 Applicants would propose the target price for each episode of care that would be set by
applying a discount to total costs for a similar episode of care as determined from
historical data. Participants in these models would be paid for their services under
the traditional fee-for-service (FFS) system--DRGs, APCs, fee schedule etc. After
the conclusion of the episode, the total payments would be compared with the target
price. Participating providers may then be able to divide up the surplus or loss.
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Healthcare Reform: From ACQ
to ACO
Community Providers
Accountable Care
Organizations
BonusEligible
Providers
(ACO defined)
Providers
Used for
Patient
Assignment
There is no
ACO
Without
Physicians
(ACO Defined)
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The Question That Will
Need To Be Answered
ACO Launched
Projected Spending
Target Spending
Shared Savings
Actual Spending
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Key Requirements
• Accountability for quality, cost &overall care
– Must report cost, quality & other data to CMS
• 3 year period for budget benchmarks & agreement
• “Shared Savings” methodology—no cost increase
– Mainly FFS but could use partial capitation or bundling
• Must have PCPs serving >5,000 Medicare patients
•
• Formal legal entity with leadership & management
• Incorporate EBM, patient engagement, and patient
centeredness
HHS Secretary given broad discretion
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Comparison of Proposed and Finalized Requirements
for the Medicare Shared Savings Program
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Comparison of Proposed and Finalized Requirements
for the Medicare Shared Savings Program
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Comparison of Proposed and Finalized Requirements
for the Medicare Shared Savings Program
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The Bottom Line…
• The ACO game is in the early stages of definition
– Keep options open and remain independent while the dust settles
– Some specialties are likely to have additional value-based options with
Medicare before all is done
• Potential pilot initiatives (demonstrations) through CMI
• Value-based reimbursement generally depends on…
– The ability to deliver and document high quality, cost effective care is vital
regardless of whether one joins and ACO or remains independent
– Success requires scale, investment and changes in practice governance
and practice patterns
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The Bottom Line (cont.)
• Relative to hospitals
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Hospitals need physicians more than physicians need hospitals
Hospitals are high cost providers/are targets of budget legislation
Physician employment in the past failed and is likely to fail again
Research shows that hospital centric ACO's failed to save money, and
more importantly, did not make money
• PGP Demonstration, 5 years
• 4 out of 10 received a payment bonus
– Winners split $29.4m
• Only 2 hit bonus all 5 years
– Marshfield…$15.8m
– University of Michigan Faculty Medical Group…$5.3m
• 7 hit 100% of the target CQMs…but only in the last year
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Akscin’s 5.5 Pearls of Wisdom For Success
Engage
Focus
Address
Develop
Measure
Celebrate !
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The Picture is Clearer…
The Future is Now!