Accelerating Care and Payment Innovation: The CMS Innovation Center

1. Accelerating Care and Payment Innovation: The CMS Innovation Center

2. Thank You For the care you are providing every day For the hard work you are doing to improve your care systems every day For your commitment to health care reform, innovation and transformation

3. Health Care Innovation: One Patient’s Story Marie Jones, a high risk patient, with her dedicated nurse case manager. “The idea of the program is to keep me healthy, keep me out of the hospital, and keep costs down. I don’t think I would still be here without this program. It has been my lifeline.” – Marie Jones New York Times, June 21, 2010

4. We need delivery system and payment transformation • Future State – • People-Centered • Outcomes-Driven • Sustainable • Coordinated Care Systems • New Payment Systems • Value-based purchasing • ACO shared savings • Episode-based payments • Care management fees • Data transparency Current State – Producer-Centered Volume-Driven Unsustainable Fragmented Care Systems FFS Payment Systems

5. The CMS Innovation Center “ Identify, Test, Evaluate, Scale The purpose of the [Center] is to test innovative payment and service delivery models to reduce program expenditures…while preserving or enhancing the quality of care furnished to individuals under such titles. - The Affordable CareAct

6. Our Strategy: Conduct many model tests to find out what works The Innovation Center portfolio of models will address a wide variety of patient populations, providers, and innovative approaches to payment and service delivery 6

7. Delivery Transformation Continuum Delivery Transformation Continuum Providers can choose to participate in the testing of different care delivery transformation models with different amounts of Medicare payments at risk, while benefiting from supports and resources designed to spread best practices and enhance quality. The Patient-centered Health Care System of the future Comprehensive Primary Care Health Care Innovation Awards Tools to Empower Learning and Redesign: Data Sharing, Learning Networks, RECs, PCORI, Aligned Quality Standards 7

8. Providers are Driving Transformation • More than 50,000 providers are or will be providing care to beneficiaries as part of the Innovation Center’s current initiatives • Over 250 organizations are participating in Medicare ACOs • More than 4 million Medicare FFS beneficiaries are receiving care from ACOs • More than 1 million Medicare FFS beneficiaries are participating in primary care initiatives

9. Accountable Care Medicare Shared Savings Program (Center for Medicare) Pioneer ACO Model Advance Payment Model Comprehensive ESRD Care Initiative 9

10. 4 million Medicare beneficiaries having care coordinated by 220 SSP and 32 Pioneers ACOs(Geographic Distribution of ACO Population)

11. The Pioneer ACO Model GOAL: Test payment arrangements with higher risk and reward than MSSP, including partial- and full capitation arrangements, as well as a transition from FFS to population based payments. • Designed for health care organizations and providers that are already experienced in coordinating care • Requires ACOs to create similar arrangements with other payers. • Option for transition from shared savings to population-based payment in Year 3 • 32 Participating ACOs announced in December 2011 • Over 900,000 aligned beneficiaries • First performance period began in January 2012. 11

12. Quality Measurement & Performance for ACOs • 33 Quality measures are separated into the following four key domains: • Better Care • Patient/Caregiver Experience • Care Coordination/Patient Safety • Better Health • Preventative Health • At-Risk Population • ACOs must meet quality targets to share in savings and the amount of savings shared depends on quality performance

13. Comprehensive Primary Care Initiative GOAL: Test a multi-payer initiative fostering collaboration between public and private health care payers to strengthen primary care. 13 • Collaborating with public and private insurers in purchasing high value primary care in communities they serve. • Requires investment across multiple payers • individual health plans, covering only their members, cannot provide enough resources to transform primary care delivery. • Medicare will pay approximately $20 per beneficiary per month (PBPM) then move towards smaller PBPM to be combined with shared savings opportunity. • The 7 markets selected: Ohio (Dayton), Oklahoma (Tulsa), Arkansas, Colorado, New Jersey, Oregon, New York (Hudson Valley)

14. Comprehensive Primary Care Initiative 14 14

15. Bundled Paymentsfor Care Improvement • GOAL: Test payment models that link payments for multiple services patients receive during an episode of care for effectiveness in promoting coordination across services and reducing the cost of care. Four models: • Acute care hospital stay only • Acute care hospital stay plus post-acute care • Post-acute care only • Prospective payment of all services during inpatient stay 15

16. Bundled Payments for Care Improvement: All Participants 16 16

17. Bundled Payments: 4 Models

18. Health Care Innovation Awards Round Two GOAL: Test new innovative service delivery and payment models that will deliver better care and lower costs for Medicare, Medicaid, and Children’s Health Insurance Program (CHIP) enrollees. • Test models in four categories: • Reduce Medicare, Medicaid and/or CHIP expenditures in outpatient and/or post-acute settings • Improve care for populations with specialized needs • Transform the financial and clinical models for specific types of providers and suppliers • Improve the health of populations • Letter of Intent due June 28, 2013 • Applications due August 15, 2013

19. National Outcomes are Improving

20. We are starting to see results nationally Cost trends are down, Outcomes are Improving & Adverse Events are Falling • Total U.S. health spending grew only 3.9 percent in 2011 • Medicare 30-day, all-cause readmission rate is estimated to have dropped 1 percent after being at 19 percent for five years • 70,000 fewer readmissions in 2012 • Expanding coverage with insurance marketplaces gearing up for 2014

21. Results: Medicare Per-Capita Spending Growth at Historic Low Source: CMS Office of the Actuary, Midsession Review – FY 2013 Budget

22. Our Ask: • Continue the work of improving quality and patient safety • Push your organizations to support this transition to a sustainable patient center healthcare system • Chose Your Pathways: • ACOs, Models focused on Primary Care, Bundled Payments for Care Improvement, State Innovation Models • Make your personal commitment to transformation

23. Appendix

24. Multi-payer AdvancedPrimary Care Practice Model GOAL: Test the effectiveness of offering providers a common payment method from Medicare, Medicaid, and private health plans. • Medicare will participate in existing State multi-payer health reform initiatives. • Must include participation from Medicaid and private health plans. • Monthly care management fee for beneficiaries receiving primary care from Advanced Primary Care practices. • Eight states selected: Maine, Vermont, Rhode Island, New York, Pennsylvania, North Carolina, Michigan and Minnesota. 24

25. Federally Qualified Health Center (FQHC) Advanced Primary Care Demonstration GOAL: Evaluate impact of the advanced primary care practice model in the Federally Qualified Health Center (FQHC) setting. • Open to FQHCs that have provided medical services to at least 200 Medicare beneficiaries in previous 12-month period. • FQHC receives care management fee for each Medicare beneficiary enrolled. • 485 FQHCs selected. • Performance year started Nov 1, 2011. 25

26. Independence at Home GOAL: Testing the effectiveness of providing chronically ill beneficiaries with home-based primary care. • Medical practices provide chronically ill beneficiaries with home-based primary care. • Practices must serve 200 targeted beneficiaries living with multiple chronic diseases to be eligible • Beneficiaries must be living with multiple chronic diseases • Incentive payments for practices successful in: • meeting quality standards; and • reducing total expenditures • 15 independent practices and 3 consortia participating 26

27. Graduate Nurse Education Demonstration GOAL: To increase the provision of qualified training supply of to Advanced Practice Registered Nursing (APRN) students in order to provide access to primary care services for the increasing number of Medicare beneficiaries. • 4 year demonstration where participating hospitals will be paid for the reasonable costs of the non-hospital community- based care setting clinical training component of the APRN degree requirements • Hospitals must partner with schools of nursing and community-based care settings and can partner with other hospitals • 5 hospitals participating 27

28. Initiatives Focused on Medicare-Medicaid Enrollees • Financial Alignment Initiative • Initiative to Reduce Avoidable Hospitalizations of Nursing Facility Residents 28

29. Financial Alignment Initiative GOAL: Test two models for effectiveness in improving quality of care for Medicare-Medicaid enrollees and reducing costs to Medicare and Medicaid. Two Demonstration Models: • Capitated Model: Three-way contract among State, CMS and health plan to provide comprehensive, coordinated care in a more cost-effective way. • Managed FFS Model: Agreement between State and CMS under which States would be eligible to benefit from savings resulting from initiatives to reduce costs in both Medicaid and Medicare. Participating states: Massachusetts, Washington, Ohio, Illinois, California, Virginia 29

30. Initiative to Reduce Avoidable Hospitalizations Among Nursing Facility Residents GOAL: Test evidence-based interventions for their effectiveness in reducing preventable inpatient hospitalizations among residents of nursing facilities. • Participants implement evidence-based interventions at a minimum of 15 Medicare-Medicaid certified nursing facilities. • 7 organizations selected to participate • Interventions must: • Improve beneficiary safety through coordinating management of prescription drugs • Bring onsite staff to collaborate and coordinate with providers • Demonstrate a strong evidence base 30

31. Capacity to Spread Innovation • Partnership for Patients • Community Based Care Transition Program • Million Hearts • Innovation Advisors Program • Care Innovations Summit 31

32. Partnership for Patients GOALS: 40% Reduction in Preventable Hospital- Acquired Conditions • 1.8 Million Fewer Injuries | 60,000 Lives Saved 20% Reduction in 30-Day Readmissions • 1.6 Million Patients Recover without Readmission 32 partnershipforpatients.cms.gov

33. Hospital Engagement Networks • American Hospital Association • Premier • VHA • NC Hospital Assoc • Intermountain HealthCare • GA Hospital Assoc • TX Hospital Assoc • MN Hospital Assoc • NY State Hosp Assoc • IA Healthcare Collaborative • PA Hospital Assoc • WA Hospital Assoc • Dallas Fort Worth Regional Hospital Assoc • OH Hospital Assoc • NJ Hospital Assoc • Ascension Health • TN Hospital Assoc • MI Hospital Assoc • National Public Hospital & Health Institute • Lifepoint • Joint Commission Resources • OH Children’s Hospital • Dignity Healthcare • NV Hospital Assoc • Carolinas Health Care • University Health Care Collaborative 33

34. Community-based Care Transitions Program (CCTP) • GOALS: Test models for improving care transitions from the hospital to other settings and reducing readmissions for high-risk Medicare beneficiaries • Open to community-based organizations partnered with hospitals • Currently 102 participants • $300 million in total funding • Participants in all 10 CMS Regions 34

35. Million Hearts Initiative GOAL: Prevent 1 million heart attacks and strokes in 5 years Focus, coordinate, and enhance cardiovascular disease prevention activities across the public and private sectors. • Will scale-up proven clinical and community strategies to prevent heart disease and stroke across the nation. • Led by Centers for Disease Control and Prevention and Centers for Medicare and Medicaid Services within HHS. • Partners include: American Heart Association, YMCA, and many other private and public organizations. 35

36. Initiatives Focused on the Medicaid Population • Medicaid Emergency Psychiatric Demonstration • Medicaid Incentives for Prevention of Chronic Diseases • Strong Start Initiative 36

37. Medicaid Emergency Psychiatric Demonstration GOAL: Test whether Medicaid Beneficiaries aged 21 to 64 who are experiencing a psychiatric emergency (suicidal or homicidal thoughts or gestures) get more immediate, appropriate care when institutions for mental diseases (IMDs) receive Medicaid reimbursement • Demonstration provides up to $75 million in federal matching funds over 3 years • Demonstration pays for inpatient services necessary to stabilize the psychiatric emergency • 11 States – Alabama, California, Connecticut, Illinois, Maine, Maryland, Missouri, North Carolina, Rhode Island, Washington, and West Virginia – and the District of Columbia applied and were selected to participate 37

38. Medicaid Incentives for Prevention of Chronic Diseases (MIPCD) GOAL: Testing the impact of providing incentives to Medicaid beneficiaries who participate in prevention programs and demonstrate changes in health risk and outcomes, including the adoption of healthy behaviors. One or more of the following prevention goals must be addressed: • tobacco cessation • controlling or reducing weight • lowering cholesterol • lowering blood pressure • avoiding the onset of diabetes or in the case of a diabetic, improving the management of the condition Grants awarded to: California, Montana, New York, Connecticut, Nevada, Texas, Hawaii, New Hampshire, Wisconsin, Minnesota 38

39. Strong Start: Strategy 1 GOAL: Test ways to encourage best practices and support providers in reducing early elective deliveries prior to 39 weeks. 3 primary activities: • Promote Awareness – support broad-based awareness efforts in partnership with March of Dimes, American College of Obstetricians and Gynecologists and other organizations. • Spread Best Practices – building on efforts of Partnership for Patients to create measureable goals and provide technical assistance in testing and implementing a variety of strategies. • Promote Transparency – support efforts to collect performance data and measure success and continuous improvement. 39

40. Strong Start: Strategy 2 GOAL: Test effectiveness of prenatal care approaches to reduce preterm births for women covered by Medicaid or CHIP who are at risk for preterm births • Testing 3 approaches to the delivery of enhanced prenatal care • Targets women receiving Medicaid and at risk for having a preterm birth • Up to $43 million in funding to 27 awardees (announced February 15, 2013) • Awards will be located in 32 states, the District of Columbia and Puerto Rico, and will serve more than 80,000 women enrolled in Medicaid or CHIP over the three intervention years 40

41. Health Care Innovation Awards GOAL: Test a broad range of innovative service delivery and payment models that achieve better care, better health and lower costs through improvement in communities across the nation. • 107 Projects Awarded in Round 1 • Awards range from approximately $1 million to $30 million for a three-year period. • Funding activity in all 50 states • Nearly 3000 applications received • Applications were accepted from providers, payers, local government, public-private partnerships and multi-payer collaboratives. 41

42. Health Care Innovation Awards 42

43. State Innovation Models • GOALS: • Partner with states to develop broad-based State Health Care Innovation Plans • Plan, design, test and support of new payment and service and delivery models in the context of larger health system transformation • Utilize the tools and policy levers available to states • Engage a broad group of stakeholders in health system transformation • Coordinate multiple strategies into a plan for health system improvement 43

44. State Innovation Models Awardees Model Testing States • Arkansas • Maine • Massachusetts • Minnesota • Oregon • Vermont Model Pre-Testing States • Colorado • New York • Washington Model Design States • California • Connecticut • Delaware • Hawaii • Idaho • Illinois • Iowa • Maryland • Michigan • New Hampshire • Ohio • Pennsylvania • Rhode Island • Tennessee • Texas • Utah (Announced 2/21/13) 44

45. State Innovation Models 45

46. Innovation is happening broadly across the country 46

47. Thank You innovation.cms.gov 47