PTAC Recommends 2 APMs for Potential MACRA Implementation

November 10, 2017 - The Physician-Focused Payment Model Technical Advisory Committee (PTAC) recently recommended two alternative payment models to HHS for possible MACRA implementation.

Stakeholders have submitted 19 alternative payment model proposals since the committee launched after the 2015 MACRA implementation rule. The committee of 11 individuals with experience and expertise in physician-focused payment models have only forwarded two proposals to HHS for limited scale testing prior to the most recent recommendations.

The two proposals were Project Sonar, a gastroenterology-focused alternative payment model, and the American College of Surgeons (ACS)-Brandeis Advanced Alternative Payment Model, a bundled payment model for surgical episodes.

HHS decided not to launch limited scale tests for the two alternative payment models despite PTAC approval. The federal department plans to work with the model’s creators to improve the proposals.

During its September meeting, PTAC suggested two more proposals for potential inclusion in MACRA. In a committee first, members forwarded the HaH Plus (Hospital at Home Plus) Provider-Focused Payment Model for full implementation. The Oncology Bundled Payment Program Using CNA-Guided Care proposal moved forward for potential limited-scale testing.

HaH Plus (Hospital at Home Plus) Provider-Focused Payment Model

READ MORE: Understanding the Value-Based Reimbursement Model Landscape

The Icahn School of Medicine at Mount Sinai designed the HaH Plus model to allow Medicare beneficiaries who require inpatient hospitalizations to receive hospital-level acute care services at home.

Patients who have acute illnesses or worsening chronic diseases that fall into 44 Medicare Severity Diagnosis Related Groups (MS-DRGs) would qualify for the HaH Plus program. The model’s creators determined that about 21 percent of patients who fall into the 44 MS-DRGs would qualify for less expensive, at-home care under the HaH Plus model.

The qualifying patients would go into either the Observation at Home or the Palliative Care at Home track. Each track contains an acute care phase and a 30-day transition period following “discharge” from acute care services.

The acute care phase includes daily (or more frequent) visits from a physician or advanced practice nurse and registered nurse. The patients would also receive daily (or more frequent) access to radiology, labs, and pharmacy if needed.

During the 30-day transition period, the patient’s regular care providers would perform post-discharge visits and care coordination services.

READ MORE: Using an Alternative Payment Model to Reduce Hospitalizations

Providers would receive a bundled payment for the acute care and transition services. The bundled payment would be 95 percent of the DRG payment that would have been reimbursed to a hospital and the average professional fees that would have been paid to providers had the patient received treated in the hospital.

The bundled payment also includes a performance-based component. The component is a shared savings/losses payment based on the total spending for acute care and transition services compared to a target price and quality performance.

Model creators noted that the target price would be the average spending for hospitalized patients in the same region who had the same DRGs.

Providers would be accountable for savings and losses up to 10 percent of the target price. CMS would collect the first 3 percent of any savings and the remaining savings would be reimbursed back to the providers.

Providers would be responsible for repaying CMS for any potential financial losses.

READ MORE: How MACRA Implementation Rules Affect Provider Profitability

PTAC recommended the HaH Plus model to fill a need for a Medicare alternative payment model for home-based hospital-level acute care for qualifying patients. The model would “support broader efforts to move care out of the hospital setting appropriately.”

The HaH Plus model also promotes greater patient choice for care and care coordination, the committee added.

While PTAC suggested that the model be fully implemented, the committee identified weaknesses that should be corrected prior to implementation.

The committee expressed concerns about patient safety under the model. Providers need to ensure that qualifying patients can be safely cared for in the home versus a hospital. The model should include external monitoring of patient cases and formal provider training requirements to counter patient safety risks.

The committee also found faults with the payment methodology. The bundled payment discount should be larger than the current MS-DRG reimbursement amount because the intensity of services would be lower than for hospitalized patients. The reimbursement should also contain a quality adjustment.

Additionally, PTAC advised the creators to reduce the financial risk providers take on at first. Risk should increase over time to encourage model participation.

Oncology Bundled Payment Program Using CNA-Guided Care

Oncology Bundled Payment Program Using CNA-Guided Care is an episode-based alternative payment model created by Cota, Inc. and Hackensack Meridian Health (HMH).The bundled payment model would cover care episodes involving patients newly diagnosed with breast, colon, rectal, and lung cancer.

The care episode would start on the day of pathologic diagnosis of cancer and last for a year. Providers would receive bundled payments that cover the cost of care for oncology services for the four cancers identified and “unrelated” services. MHM and Cota proposed 27 bundled payments for the four cancer types. The payments intend to “ensure payments match the care needs of subgroups of similar patients.”

The subgroups would be determined by Cota’s proprietary patient classification system, which assigns each patient a Cota Nodal Address (CNA) based on historical, demographic, biologic, and treatment factors. Providers could also use similar patient classification systems from other vendors.

CNAs would link to pre-determined treatment protocols, called lanes. The treatment lanes are based on a three-year retrospective study of patient characteristics, treatments, outcomes, and care costs, as well as nationally accepted care guidelines primarily from the National Comprehensive Cancer Network and American Society of Clinical Oncology.

Providers would select from multiple lanes for each CNA and follow the treatment plan. Then, providers would receive a bundled payment based on the CNA and treatment lane.

HMH and Cota noted that the patient classification system can assign multiple CNAs to a patient. The costs of each CNA will be combined and averaged using a weighted approach for the bundled payment.

If providers exceed the bundled payment amount, they incur a financial loss. However, providers are not at risk for repayment.

Additionally, a part of the bundled payment would be incentive-based. Providers would earn greater compensation by meeting performance and quality standards while reducing the cost of care below the bundled payment amount.

HMH and Cota initially intended for the bundled payment model to only be implemented in the HMH system. Although, the organizations stated that the model could be implemented at other facilities after a pilot demonstration.

PTAC suggested that HHS test the model on a small scale because the model promotes precision medicine use. The model should also be tested outside of the HMH system to generate more data on developing a cancer bundled payment model.

However, the committee stipulated that the Oncology Bundled Payment Program Using CNA-Guided Care should undergo the following changes prior to limited scale testing:

• Gather feedback from other oncology groups and clinicians involved in patient care

• Test model in more than one site

• Consider advantages and disadvantages of proprietary software use

• Establish formal patient engagement and shared decision-making processes

• Make quality-based incentive payments more explicit

• Coordinate model testing with other limited scale pilots, such as the Medicare Oncology Care Model

HHS should also consider how the bundled payment model might integrate with the PTAC-recommended ACS Brandeis Advanced Alternative Payment Model.