Published 2/1/2017
Elizabeth Fassbender

CMS Issues Advancing Care Coordination Final Rule

On Dec. 20, 2016, the Centers for Medicare & Medicaid Services (CMS) finalized a rule that will, according to CMS, "continue the Administration's progress to shift Medicare payments from rewarding quantity to rewarding quality by creating strong incentives for hospitals to deliver better care to patients at a lower cost." Although the rule makes some positive changes to the proposal, the American Association of Orthopaedic Surgeons (AAOS) commented on a number of items that must still be addressed.

"These models are an opportunity to further provider collaboration and sharing of best practices," CMS stated. "In the Comprehensive Care for Joint Replacement (CJR) Model, approximately 90 percent of hospitals participating in the model are fostering education, outreach, communication, and collaboration. These new models advance CMS' goal of improving the efficiency and quality of care for Medicare beneficiaries and encourage hospitals, physicians, and post-acute care providers to work together to improve the coordination of care from the initial hospitalization through recovery."

Payment models and ACOs
The rule does three things: (1) it finalizes three new cardiac care payment models; (2) it finalizes the Surgical Hip and Femur Fracture Treatment (SHFFT) Model, which targets patients who receive surgery after a hip fracture, other than hip replacement; and (3) it provides an accountable care organization (ACO) opportunity for small practices. The SHFFT Model expands on the CJR Model, which began in April 2016. The AAOS commented on the proposed rule in 2016, strongly opposing the mandatory models.

According to CMS, the new Medicare ACO Track 1+ Model will have more limited downside risk than Tracks 2 or 3 of the Medicare Shared Savings Program to encourage more practices, especially small practices, to advance to performance-based risk.

Under the SHFFT section, the final rule also makes adjustments to the CJR Model, enabling the model to qualify as an Advanced Alternative Payment Model (APM). Thus, the SHFFT, CJR, and ACO Track 1+ models could provide additional opportunities for physicians to qualify for a 5 percent incentive payment through the Advanced APM path under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) and the Quality Payment Program. For the SHFFT model, clinicians may potentially earn the incentive payment beginning in performance year 2019, or potentially as early as performance year 2018 if they collaborate with participating hospitals that choose the Advanced APM path. For the CJR model, clinicians may potentially earn the incentive payment beginning in performance year 2017. For the Track 1+ Model, clinicians may potentially earn the incentive payment beginning in performance year 2018, and the application cycle will align with the other Shared Savings Program tracks.

Comments from AAOS
AAOS strongly opposes the mandatory nature of models such as SHFFT, which is the second mandatory orthopaedic bundle after the CJR model. Although AAOS had asked for a delay of the start date for SHFFT, citing problems with the short turnaround between the CJR final rule publication and implementation date, CMS finalized the start date of July 1, 2017.

AAOS also asked that the first year evaluation reports of CJR be published before SHFFT implementation in the same hospitals. SHFFT, akin to CJR, is also a hospital-led bundle, and the surgeon's ability to earn the Advanced APM bonus will depend on whether the contracted hospital chooses the Advanced APM path. AAOS therefore asked for physician leadership or at least surgeon-hospital co-leadership.

Finally, the SHFFT model has been finalized without socioeconomic and demographic risk adjustment and the episode prices continue to be risk-stratified based on Medicare Severity Diagnosis Related Groups. In the final rule, CMS acknowledged AAOS' comments and citation of relevant peer-reviewed studies and has agreed to explore and implement additional adjustments.

"Unlike the Bundled Payments for Care Improvement Initiative, CJR and SHFFT are mandatory models," AAOS commented earlier. "Providers who lack such deep resources will not be able to opt out, and therefore will face unaffordable costs for participation. In addition, we are concerned about the impact on small and medium sized practices… [as] it may be more difficult for small physician practices to reach a contract with hospitals leading the CJR and SHFFT episodes."

AAOS is continuing to address the issues associated with the mandatory bundled payment models, and is particularly focused on the next administration and Congress as avenues for improvements. It should be noted that the "Better Way" healthcare proposal put forth by House Speaker Paul Ryan (R-Wisc.) includes a repeal of the CMS Innovation Center, or CMMI, beginning January 1, 2020. For more information on these payment models, visit the AAOS office of government relations at http://www.aaos.org/Advocacy/MedicarePaymentCMS/

Elizabeth Fassbender is the communications manager in the AAOS office of government relations. She can be reached at fassbender@aaos.org