The ACS-Brandeis Advanced APM

341 Pages·2017·8.91 MB·English

by  Sarah Selenich

Committee Members May 31, 2017
Jeffrey Bailet, MD, Chair
The Honorable Thomas E. Price
Elizabeth Mitchell, Vice Secretary
Chair U.S. Department of Health and Human Services
Robert Berenson, MD 200 Independence Avenue, SW
Washington, DC 20201
Paul N. Casale, MD, MPH
Tim Ferris, MD
Dear Secretary Price:
Rhonda M. Medows, MD
On behalf of the Physician-Focused Payment Model Technical Advisory
Harold D. Miller
Committee (PTAC), I am pleased to submit PTAC’s comments and
Len M. Nichols, PhD
recommendation to you on a Physician-Focused Payment Model (PFPM)
Kavita Patel, MD
submitted by the American College of Surgeons (ACS), entitled the ACS –
Bruce Steinwald, MBA Brandeis Advanced APM. These comments and recommendations are
required by the Medicare Access and CHIP Reauthorization Act of 2015
Grace Terrell, MD, MMM
(MACRA) which directs PTAC to: 1) review PFPM models submitted to PTAC
by individuals and stakeholder entities; 2) prepare comments and
recommendations regarding whether such models meet criteria established
by the Secretary of Health and Human Services (Secretary, HHS); and 3)
submit these comments and recommendations to the Secretary.
With the assistance of HHS’ Office of the Assistant Secretary for Planning and
Evaluation (ASPE), PTAC’s eleven members carefully reviewed ACS’ proposed
model (submitted to PTAC on December 14, 2016), additional information on
the model submitted by ACS in response to questions from a PTAC
Preliminary Review Team (PRT) and the PTAC as a whole, and public
comments on the proposal. At a public meeting of PTAC held on April 11,
2017, the PTAC deliberated on the extent to which this proposal meets the
criteria established by the Secretary in regulations at 42 CFR § 414.1465, and
should be recommended.
PTAC concluded that the ACS – Brandeis Advanced Alternative Payment
Model holds promise and recommends it for limited-scale testing with the
following stipulations. First, the testing should be for a very limited number
of both procedure episodes and condition episodes. This limited number
should be significantly smaller than the number proposed in the model. Second, testing should
proceed when the model has developed and is able to implement a quality measurement and
payment system that holds providers accountable for performance on quality measures
(including patient- reported outcomes (PROs)) as opposed to merely the reporting of quality
measures. Third, limited-scale testing should be undertaken only with Alternative Payment
Entities where the majority of the members of the relevant clinical affinity group(s) have agreed
to participate in the test of the model. Finally, the algorithms and construct of the episode
grouper, which is the lynchpin of the model, should be made publicly available; and a
mechanism should be in place for continuous update of the grouper so that it remains current
with advances in healthcare.
The members of PTAC appreciate your support of our shared goal to improve the Medicare
program for both beneficiaries and the physicians who care for them. The Committee looks
forward to your detailed response posted on the CMS website, and would be happy to assist
you or your staff as you develop your response. If you need additional information, please have
your staff contact me at [email protected].
Sincerely,
Jeffrey Bailet, MD
Chair
Attachments
REPORT TO THE
SECRETARY OF HEALTH
AND HUMAN SERVICES
_______________________
Comments and Recommendation on
ACS – Brandeis Advanced Alternative Payment Model
May 2017
About This Report
The Physician-Focused Payment Model Technical Advisory Committee (PTAC) was established
by the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) to: 1) review physician-
focused payment models (PFPMs) submitted by individuals and stakeholder entities; 2) prepare
comments and recommendations regarding whether such models meet criteria established by
the Secretary of Health and Human Services (Secretary, HHS); and 3) submit these comments
and recommendations to the Secretary. (See Appendix 1 for a list of PTAC members and their
terms of appointment.) PTAC reviews submitted proposals using criteria established by the
Secretary in regulations at 42 CFR § 414.1465. (See Appendix 2 for the Secretary’s criteria.) As
directed by MACRA, HHS’s Office of the Assistant Secretary for Planning and Evaluation (ASPE)
provides operational and technical support to PTAC.

This report includes: 1) a summary of PTAC’s review of a PFPM submitted by the American
College of Surgeons (ACS), entitled, ACS – Brandeis Advanced Alternative Payment Model; 2) a
summary of this model; 3) PTAC’s comments on the proposed model and its recommendation
to the Secretary; and 4) PTAC’s evaluation of the proposed PFPM against each of the
Secretary’s criteria for PFPMs. The appendices to this report include a record of the voting by
the PTAC on this proposal (Appendix 3); the proposal submitted by ACS (Appendix 4); and
additional information on the proposal submitted by ACS subsequent to the initial proposal
submission (Appendix 5).
SUMMARY STATEMENT

PTAC recommends the ACS – Brandeis Advanced Alternative Payment Model for limited-scale
testing with four stipulations. While finding that this model offers promise because of its broad
scope and focus on episodes of care for many different health care procedures and conditions,
PTAC recommends that limited-scale testing be undertaken because the model has not yet
been implemented and could benefit from testing in a limited number of both procedure
episodes and condition episodes.

PTAC REVIEW OF ACS PROPOSAL

The ACS – Brandeis Advanced Alternative Payment Model was submitted to PTAC by the
American College of Surgeons on December 14, 2016. The proposal was first reviewed by a
PTAC Preliminary Review Team (PRT) composed of three PTAC members, including one
physician. These members reviewed the proposal and related data and information, secured
additional clarifying information on the proposal from the American College of Surgeons,
reviewed all comments on the proposal submitted by the public, and talked with the Centers
for Medicare and Medicaid Services on current use of episode groupers by Medicare. The PRT’s
findings, conclusions, and recommendation were documented in a “Preliminary Review Team
Report to the Physician-Focused Payment Model Technical Advisory Committee (PTAC),” dated
March 22, 2017, and sent to the full PTAC on March 23, 2017 along with the proposal and all
related information. At a public meeting held on April 11, 2017, the PTAC deliberated on the
extent to which the proposal meets the criteria established by the Secretary in regulations at 42
CFR § 414.1465, and should be recommended.1 Below are a summary of the ACS – Brandeis
Advanced Alternative Payment Model, PTAC’s comments and recommendation to the Secretary
on this proposal, and the results of the PTAC’s evaluation of the proposal compared to the
Secretary’s criteria for PFPMs.

PROPOSAL SUMMARY

The ACS – Brandeis Advanced Alternative Payment Model (the model), is an episode-based
payment model that identifies more than one hundred candidate procedures and conditions
(payment episodes) as its focus. These procedures and conditions are diverse, including but not
limited to: upper respiratory infection; appendectomy; colonoscopy; cataract surgery; acute

1PTAC member Rhonda M. Medows, MD, was not in attendance, and PTAC member Tim Ferris, MD, recused
himself from voting.
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simple, benign fibrocystic / dysplastic breast disease; juvenile idiopathic arthritis; lung
resection; coronary artery bypass grafting; open heart valve surgery; liver transplant; heart
failure; and breast neoplasm (malignant). These episodes are defined by an updated version of
an episode grouper developed for the Centers for Medicare & Medicaid Services (CMS) by a
team led by Brandeis University. In response to a question from the PTAC PRT, the American
College of Surgeons clarified that more than 50 of these procedure episodes are ready for
implementation in 2018.

In the model, an organizational entity (which could consist of “single-specialty practices,
multispecialty practices or convenor groups of small provider practices with or without ties to
particular facilities… as long as the entity is able to perform its management and fiduciary
responsibilities.”) would enter into a risk-based contract with CMS for the quality and cost of its
contributions to a set of procedure or condition episodes defined in the contract. The contract
would involve Medicare payments for every instance of the procedure or condition episodes
defined in the contract during a performance period for which the entity’s affiliated Qualified
Participants (QPs) provide a service paid for by Medicare. Each entity participating in the model
with CMS will identify its affiliated QPs who will participate under business agreements.

Improvements in care quality and efficiency would be brought about by financial incentives and
Clinical Affinity Groups. Clinical Affinity Groups are sets of clinicians who regularly participate
together in episodes of a given type. Their decisions and services are intended to influence the
way in which patients are treated for a type of episode. Physicians would choose to participate
by contracting with the Alternative Payment Model (APM) entity. If they did so, they would
continue to have their services paid through the Medicare Physician Fee Schedule, but they
would be at financial risk for spending on the episode based on their attributed role in
providing care for the procedure/condition episodes defined in the entity’s contract with CMS.
Attributed roles would be determined by clinical algorithms that retrospectively identify all
clinicians who participated in the care of a patient for each type of episode and then infer each
clinician’s role. Incentive payments would be made retrospectively based on the difference
between the observed and expected spending for the episode. Each clinical role would be
assigned a fixed proportion of the savings or loss amount. Savings or losses would be attributed
to each participating QP based on the episodes he/she is involved in and on his/her specific role
in that care. The APM entity would receive a share of these gains or losses based on the
contract with CMS. The proposal states that “Several specific methods for determining the
share may be considered.” In the case of savings, the shared savings component of the
payment would be paid to the APM entity. According to the proposal, “The APM entity would
engage in gainsharing with affiliated QPs as agreed upon in their business agreements with the
participant, and guided at its discretion by the team-based fiscal attribution framework.” If
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spending exceeded the expected amount, the difference would be paid to CMS by the entity.
The entity would need to find a source of funds to make these payments, and the proposal
indicates that "participating providers may also be required to contribute” and “to protect
against catastrophic loses, the model will build in stop loss provisions.”

RECOMMENDATION AND COMMENTS TO THE SECRETARY

PTAC concluded that the American College of Surgeons – Brandeis Advanced Alternative
Payment Model’s broad scope and focus on episodes of care for many different health care
procedures and conditions holds promise and PTAC recommends it for limited-scale testing
with the following stipulations. First, the testing should be for a very limited number of both
procedure episodes and condition episodes. This limited number should be significantly smaller
than the 54 procedural episodes most recently proposed by the submitter and should include
both procedural and condition episodes. Second, testing should proceed when the model has
developed and is able to implement a quality measurement and payment system that measures
and incentivizes provider performance on quality measures (including patient- reported
outcomes (PROs)) as opposed to measuring and rewarding the reporting of quality measures.
Third, limited scale testing should only be undertaken with Alternative Payment Entities where
the majority of the members of the relevant clinical affinity group(s) have agreed to participate
in a test of the model. Fourth, the algorithms and construct of the episode grouper, which is the
lynchpin of the model, should be made publicly available; and a mechanism should be in place
for continuous update of the grouper so that it remains current with advances in healthcare.

These stipulations for limited scale testing were identified as a result of several issues identified
by the PTAC (discussed below). PTAC believes that the proposed model’s breadth could presage
considerable impact if these issues are addressed.

Broad Scope and Complexity of the Model and Limited Detail on Key Aspects

The Committee concluded that the very broad scope of the model ― the initial model
submitted to PTAC identified more than 100 procedures involving more than 70 separate
medical specialties ― necessitates testing the model on a limited scale to better understand
how the model is likely to change provider payments and patient care. This is particularly
important because the model has not yet been implemented and therefore not yet produced
any data on how the APM would function for any of the episodes described.

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Committee members also note that the complexity of the model contributes to an unavoidable
risk of unintended consequences which cannot be anticipated given the myriad number and
variation of interacting parts within this model. These include, for example: variation in the
numbers and types of included episodes, differing risk-sharing arrangements between the APM
entity and its qualified providers, and the proportion and effect of non-participating providers
on costs and patient outcomes.

Information on the model’s effects on individual conditions and procedures, and its impact on
provider payments and patient care was limited. As an example, PTAC found that the proposed
model described its intended effect on physician behavior at a very high level. Because it has
not been implemented, it could not provide an example of actual change in physician behavior
that the model has achieved. PTAC is not clear on the extent to which the proposed model
would achieve desired change in physician behavior.

Unclear Effect on Physician Behavior

The model involves creating sets of incentives to control spending for individual episodes of
care and then allowing those incentives to operate differentially depending on the condition,
the diagnosis, the nature of the care provided, and the venue of care. The model also is
designed to encourage multiple physicians to collaborate in addressing cost drivers in resource
use and variation in care.

PTAC members, however, had concerns about the way the model and its proposed behavioral
economics would actually change the way clinicians practice. For example, PTAC took note of
information sent by ACS that stated, “The ACS-Brandeis model does not begin with
predetermined care redesign or formulate in advance the strategies of mechanisms for change.
We designed the model to allow providers and provider groups to find their own way toward
high-quality and high-value care.” Additionally, in its April 11, 2017 reply to a question from a
PTAC member on “Where do you see something that could really fundamentally change the
way we practice medicine?” the submitter stated, “I'm not sure we're going to fundamentally
change the way we practice medicine. We want to change the way we pay for it.”

PTAC appreciates the evidence of widespread deficits in the delivery of health care nationwide,
and that it is not reasonable to expect a payment model aimed at more than one hundred
candidate procedures and conditions to describe the exact interventions to be used to improve
care in all episodes of care. Nevertheless, PTAC did anticipate the model to identify some care
delivery problems that potentially could be improved through the model and provide
information on how the model would remove barriers that exist to the provision of high quality
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healthcare. Related to this, PTAC noted that the Innovation Center's authorizing statute says
that it is authorizing "payment and service delivery models where there is evidence that the
model addresses a defined population for which there are deficits in care, leading to poorer
clinical outcomes." One area of concern with this model is that it did not clearly identify specific
deficits in care and how they would be addressed. Concern about the unknown effects on
provider behavior is increased because of concern about the ability of the model to maintain or
improve quality of care.

Questions about Potential Effects on Quality of Care

The premise of the model is that by: 1) providing information to providers on quality and total
spending on episodes; 2) designating Clinical Affinity Groups (teams of providers involved in
specific types of care delivery), and 3) giving physicians the ability to take on risk for spending
relative to risk-adjusted benchmarks, physicians will be encouraged to improve team-based
care processes and conserve resources. However, the quality measures to be used and the
standard of performance that providers are to meet are not specified. The proposal states its
intent is to move to outcome measures, but the measures are still under development.
Although the model promises the use of patient reported outcomes (PROs) as quality
measures, the model does not specify the PROs to be used.

Further, the proposed quality framework initially provides incentives simply for reporting of
quality measures as opposed to accountability for performance on quality measures, and it
specifies no minimum quality standards. Under the proposed model, if providers merely
reported on measures, then they would be eligible to receive savings, regardless of their actual
performance on the measures. This increases concern about the potential that the model could
incentivize achieving savings by stinting on care as a well as by improving quality and efficiency.
Even if payment is tied to actual performance on measures, PTAC is concerned that the
methodology could still reward savings when quality decreases. Additionally, it is not clear how
cost and quality of care data resulting from physicians who are not participating in the model
would be handled by the model.

The concerns about the model’s protections for quality lead to a concern that in the initial
years, spending could be reduced in ways that would not be beneficial to patients. In the
future, the model might well overcome these issues, but there was no assurance of when
changes in the quality measures and framework would be implemented. This concern is related
to questions about where and how accountability for quality of care resides in the model and
how it would be implemented.

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Unclear Accountability

The proposed model relies on the APM entity in which physicians participate to transfer
incentives to the individual physicians and other qualified providers to change their behavior.
The proposal cannot indicate exactly how those incentives would work at the individual
provider level because the model does not specify how entities would distribute savings and
losses, and these decisions might be very different from entity to entity, as well as for different
conditions and procedures. As a result, it is difficult to identify the accountability for
performance when the incentives at the individual practitioner level are unknown.

In addition, there is no requirement that in order for providers to participate in a procedural
episode, they must also participate in the associated condition episodes for the conditions to
which the procedure is applied. Although there is accountability in a procedural episode for
spending within an episode, accountability for the number of episodes would only exist if the
providers were also accountable for overall spending on the underlying conditions.
Consequently, if procedural episodes are not implemented along with the associated condition-
based episodes, it is possible that providers could save money within episodes but also increase
the number of episodes, which could increase total spending.

A third issue is that there is only accountability for the portion of the spending in the episode
that is allocated to clinicians who are participating in the Alternative Payment Entity. If all
members of a clinical affinity group do not participate in the model, then only a portion of the
total spending would be allocated to the entity, and Medicare would be at risk for the balance.

As a result of these possible scenarios, PTAC members felt that there needed to be assurances
that implementation would only occur where (a) both condition-based episodes and procedural
episodes were implemented together, and (b) the majority of the members of a clinical affinity
group were participating.

Questions on the Grouper

The use of a new updated version of the Episode Grouper for Medicare (EGM) is a core part of
this proposal. PTAC received general information on how the grouper is intended to work and
some information about what codes are included, but it did not receive the detailed clinical
logic behind the grouper; e.g., when a code is included in an episode and when it is not, and
comprehensive information on its performance.

PTAC members had several comments and questions on the grouper:
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