Sunday, November 13, 2011

Healthcare Costs on the Agenda

Senator Sheldon Whitehouse (D-RI) brought together a panel of experts to the Capitol Hill to discuss ways to reduce the skyrocketing costs in our healthcare system while improving the quality of care. On November 10th, Senator Whitehouse chaired the Senate Health, Education, Labor and Pensions (HELP) Committee hearing on “Healthcare Savings Through Delivery System Reform”.

The hearing examined the tools needed to drive down costs and to improve quality of care by advocating prevention, improving quality, reforming the payment system, and simplifying the process. In addition, in the past several years, Senator Whitehouse has been working hard to create a robust, secure health IT infrastructure not only in his state but in the entire country.

One of the panelists Jonathan Blum, Deputy Administrator and Director the CMS Centers for Medicare and Medicaid Services outlined how hospital payments account for the largest share of Medicare spending and Medicare is the largest single payer for hospital services.

Earlier this year, CMS established the new Hospital Value-Based Purchasing (VBP) Program, which is going to change how CMS pays hospitals for inpatient acute care. This program which ties payment to value is expected to foster higher quality care for all hospital patients across the U.S health system.

In FY 2013, CMS will implement the new budget-neutral value-based incentive payments. In the future, CMS plans to add new measures that focus on improved patient outcomes and the prevention of hospital-acquired conditions.

ACOs are part of CMS and will bring together doctors, hospitals, and other healthcare providers to better coordinate care for patients. Blum announced that CMS has released the Medicare Shared Savings Program final rule (CMS-1345-F) on October 20, 2011. Under this program, providers who voluntarily form an ACO and meet quality standards based upon patients outcomes and care coordination as well as other measures, may share in the savings they achieve for the Medicare program. ACOs that commit to share in savings and losses for the duration of the agreement may receive a higher share of any generated savings.

In addition, CMS in their Innovation Center is testing alternative payment models and preparing organizations to provide accountable care. These initiatives include:

• The Pioneer ACO Model to allow providers groups to move more rapidly to a population-based payment model on a track consistent with but separate from the Medicare Shared Savings Program

• The Advance Payment ACO Model to provide additional support to rural and physician-based ACOs who participate in the Medicare Shared Savings Program, but lack the start-up resources to build the necessary infrastructure

• The Accelerated Development Learning Sessions to help providers with information on how to become an ACO

In recent months CMS has launched several new initiatives through the CMS Innovation Center that involves investments in primary care and medical homes. For example, the Comprehensive Primary Care Initiative (CPC) works with public and private healthcare payers to help strengthen primary care. The CPC initiative will test two models simultaneously such as a service delivery model and a payment model to see how primary care practices can best coordinate care for their patients.

Another example is the Innovation Advisors Initiative which is currently accepting applications for up to 200 health professionals to undertake intensive efforts to expand their health systems skills and knowledge, apply what they learn in their organizations and areas, and work with CMS to test new models of care delivery in their own organizations and communities.

CMS is helping doctors to begin using EHRs through the EHR incentive program. HHS has also issued administrative simplification rules (CMS-0032-IFC) to improve the use of electronic standards to help eliminate inefficient manual processes. CMS estimates that these changes will save providers and health plans $12 billion over the next 10 years.

In addition, recently, the Medicare-Medicaid Coordination Office announced a new opportunity for states to participate in demonstration projects designed to improve the quality of care for Medicare-Medicaid enrollees. The states now have the opportunity to share in reduced costs and CMS is reporting that 37 states and the District of Columbia have indicated interest in the demonstration project.