Summary of the HIT Policy Committee Report to Congress

Below is a summary of the HIT Policy Committee Report: "Challenges and Barriers to Interoperability" submitted to Congress today:

The Consolidated and Further Continuing Appropriations Act, 2015 was signed by the President on December 1, 2014. It reads in part:

Interoperability.--The agreement directs the Health IT Policy Committee to submit a report to the House and Senate Committees on Appropriations and the appropriate authorizing committees no later than 12 months after enactment of this act regarding the challenges and barriers to interoperability. The report should cover the technical, operational and financial barriers to interoperability, the role of certification in advancing or hindering interoperability across various providers, as well as any other barriers identified by the Policy Committee.

Past Health IT Policy Committee recommendations in the following categories of barriers to interoperability:

• Lack of universal adoption of standards-based EHR systems
• Impact on providers’ day-to-day workflow
• Complex privacy and security challenges associated with widespread health information exchange
• Need for synchronous collective action among multiple stakeholders
• Weak or misaligned incentives

Interoperability is defined as the ability of two or more systems to exchange information and the ability of those systems to use the information that has been exchanged without special effort. Although substantial interoperability amongst all stakeholders in American health care has not been achieved to date, there are pockets of meaningful health information exchange developing.

The following new recommendations were developed by the Interoperability Task Force of the HITPC to build upon work that ONC has undertaken to identify solutions to some of the barriers identified within this report, most notably, ONC’s updated version of the Shared Nationwide Interoperability Roadmap (Interoperability Roadmap).

Three Recommendations

Develop and implement meaningful measures of HIE-sensitive health outcomes and resource use for public reporting and payment

HIE-sensitive measures are those which require health information to be exchanged and effectively used in order for the applicant to earn high scores. In order to enhance the strength of incentives that drive interoperability, a set of specific measures should be developed that focus on the delivery of coordinated care, facilitated by shared information across the entire health team (including the individuals and families) and throughout the continuum of care settings. An example of an HIE-sensitive measure would look at medically unnecessary duplicate testing. Payers could provide incentive clout by declining to reimburse for medically unnecessary duplicate testing.

Develop and implement HIE-sensitive vendor performance measures for certification and public reporting

While use of HIE-sensitive quality and value measures for provider organizations may serve as an indirect incentive for vendors to improve their systems, we believe that direct measures of HIE-sensitive vendor performance will bolster market forces behind vendor business practices that promote interoperability. Today, purchasers of EHR systems lack such measures to inform purchasing decisions or to use as a lever to put pressure on vendors to improve. Although vendors have strong incentives to pass the interoperability requirements for EHR certification, this process is “one-time” and occurs in a lab. It has not been shown to translate into interoperability that is affordable or easy to implement in the field.

Accelerate Payment Incentives for Interoperability: Set specific HIE-sensitive payment incentives that incorporate specific performance measure criteria and a timeline for implementation that establishes clear objectives of what must be accomplished under alternative payment models

Payers have existing mechanisms through which to incentivize providers to meet HIE-sensitive outcome measures, and Medicare is the logical payer to lead such efforts (particularly as CMS operationalizes new payment requirements under the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). We note that these measures do not require defining interoperability as a new domain of performance incentives as they could easily be incorporated into incentive programs that target dimensions of provider performance that are HIE-sensitive, such as care that is coordinated, high-value, and safe, as well as integrated across the health and social services continuum. For example, a payment policy that denies claims for medically unnecessary duplicate testing for high-cost imaging would require coordination, or at least awareness, of orders and results by all providers involved in the care of an individual patient. Providing a roadmap for specific HIE-sensitive performance measures for future payment incentives, with enough lead time, will motivate and catalyze specific actions to speed the pace of achieving effective health information exchange that facilitates high priority use cases.

SGR is gone with MIPS taking it's place, Meaningful use being absorbed

SGR Repeal and Medicare Provider Payment Modernization Act

Although they have not yet determined how it will be paid for, the House (bill referred to Committee on Energy and Commerce et al) and Senate (bill referred to Senate Finance) have agreed on a permanent fix to the sustainable growth rate (SGR) formula that sets physician payment in the Medicare program. Under the deal Medicare will increase the amount it pays physicians by 0.5% each year for the next five years. The plan provides financial incentives for healthcare providers to participate in tests of alternative payment models (APMs). The deal also includes offers of bonuses to providers that agree to have their reimbursements based more on outcomes than on the volume of services they provide. The bill would also consolidate 3 different Medicare incentive programs, including the one for meaningful use of an electronic health record system (EHR).  

Starting in 2018, payments under the new system would be adjusted based on performance in the new incentive system, the Merit-Based Incentive Payment System (MIPS), which consolidates three incentive programs: the Physician Quality Reporting System (PQRS), which provides incentives for physicians to report on the quality of care measures; the Value-Based Payment Modifier, which adjusts payment based on quality use of resources; and meaningful use of electronic health records. MIPS will assess performance in four categories:

1. Quality - In addition to measures used in the existing quality performance programs (PQRS, VBM, EHR MU) HHS will develop additional measures. Measures used by qualified clinical data registries may also be used to assess performance under this category.
2. Resource Use - The resource use category will include measures used in the current VBM program.
3. Meaningful Use - Current EHR meaningful use requirements, demonstrated by use of a certified system, will continue to apply in order to receive credit towards incentives in the new system. However, to prevent duplicative reporting, professionals who report quality measures through certified EHR systems for the MIPS quality category are deemed to meet the meaningful use clinical quality measure component.
4. Clinical Practice Improvement Activities - Professionals will be assessed on their effort to engage in clinical practice improvement activities. Incorporation of this new component gives credit to professionals working to improve their practices and facilitates future participation in APMs.

At the end of 2017 some incentive program penalties are sunset, including the 2 percent penalty for failure to report PQRS quality measures and the 3 percent (which would have increased to 5 percent in 2019) penalty for failure to meet EHR meaningful use requirements. The legislation would also require that EHRs be interoperable by 2017 and prohibit providers from deliberately blocking information sharing with other EHR vendor products. Another provision would require HHS to publish a list of clinical-decision support tools by April 1, 2016, that would be used in a program promoting the appropriate use of advanced diagnostic imaging. After Jan. 1, 2017, Medicare will pay only for images ordered by a clinician who has consulted one of these qualified systems and whose order adheres to what are called applicable "Appropriate Use Criteria."

There is flexibility to participate in MIPS in a way that best suits a particular practice environment. These options could include: use of EHRs, use of qualified clinical data registries maintained by physician specialty organizations, and the option to be assessed as a group, as a “virtual” group, or with an affiliated hospital or facility. Technical assistance would also be available to help practices with 15 or fewer professionals improve MIPS performance or transition to APMs. Overall, there will be very strong incentives to participate in APMs.

This bill will consolidate plans proposed last year by the Senate Finance, House Ways and Means, and House Energy and Commerce committees. How to pay for this new plan is still a big task ahead, although there seems to be enough momentum behind the effort to get this done. With the 0.5 percent increase, the cost for the SGR repeal comes to about $125 billion over 10 years, according to the Congressional Budget Office. A powerful array of provider organizations have expressed strong support including:

• The American Medical Association
• The American College of Physicians
• American Academy of Family Physicians

But the final product still needs to pass both houses of Congress and then be signed by the President. And hospital groups may be the first to try to guard their share of revenue. Already earlier this week the Federation of American Hospitals published a chart describing recent cuts on its blog entitled "Enough is Enough." There will be jockeying to determine funding, but I think we are closer than ever before to finally resolve this incredibly important issue, and at the same time make some smart moves in consolidating and simplifying programs while moving towards a payment system that rewards quality instead of quantity in healthcare.

SGR Repeal and Medicare Provider Payment Modernization Act

H.R.4015 

Healthcare Impact of the "Fiscal Cliff" Deal

Members of the U.S. House of Representatives have voted by 257-167, with 172 Democratic votes and only 85 Republicans voting in favor, to approve the previously Senate-passed bill that will avert the so-called "fiscal cliff" of automatic tax increases and mandated spending cuts. Under the plan, taxes will increase for individuals making more than $400,000 a year and couples earning more than $450,000, as well as on investment profits and dividends, the first U.S. income tax increase in 20 years. The package will extend unemployment benefits for a year and boost taxes on large inheritances. It also allows payroll taxes to go back up to 6.2% this year from 4.2 percent in 2011 and 2012, amounting to a $1,000 tax increase for someone earning $50,000 a year. The "fiscal cliff" bill is the result of two days of marathon negotiations between the White House and Senate Republicans. It was passed in an unusual vote early on New Year's Day, 89-8. Senate Minority Leader Mitch McConnell said the compromise was an "imperfect agreement" that will keep tax hikes from affecting most Americans. There are significant effects on healthcare as part of this package.

The nonpartisan Congressional Budget Office released a report estimating that the Senate bill would add $329 billion to deficits in 2013 and $3.9 trillion to deficits over the next 10 years, relative to current law. The CBO analysis of the bill shows fiscal 2013 revenues would be $280 billion lower and spending $50 billion higher, resulting in a $330 billion deficit increase, for a total deficit of around $971 billion in 2013. The bill would apply another temporary SGR fix and block the scheduled 27% payment cuts to Medicare providers, and keep rates frozen at current levels for one year. A companion CBO report (PDF) entitled Detail on Estimated Budgetary Effects of Title VI (Medicare and Other Health Extensions) of H.R. 8, the American Taxpayer Relief Act of 2012, As passed by the Senate on January 1, 2013 gives the details of the impact to Medicare. Among the provisions affecting healthcare (hat tip to Matthew Taber) are:

• elimination of funding for Medicare Improvement Fund
• rebasing of State DSH allotments
• repeal of the CLASS program (part of the ACA)
• creates commission on Long Term Care
• ambulance add-on services
• extension of payments for low-volumne hospitals
• extension of MDH program
• extension Medicare Advantage special needs programs
• extension of medicare reasonable cost contracts
• extension of qualifying individual program
• extension of transitional medical assistance program
• extension of S-CHIP Express Lane
• extension of family-to family health information center
• extension of indian diabetes program
• coding adjustment for MS-DRGs
• revisions to Medicare ESRD bundled payments
• treatment of multiple service payment policies for therapy services
• payment for certain radiology services
• adjustment of equipment utilization rate for radiology 
• elimination of overpayment for diabetic supplies
• removes obstacles to collection of overpayments
• improves medicare advantage coding intensity adjustment

The bill rescinds all unobligated funds for a program in the health care law to help set up consumer-oriented nonprofit health plans. The bill will create a contingency fund of 10 percent of current unobligated funds to help co-op plans that have already been approved. Savings from this provision amount to $2.3 billion. Also under the bill, the Medicare Improvement Fund would be eliminated, saving $1.7 billion.

The legislation cuts $4.9 billion by changing the bundled payment given for end-stage renal disease services. An additional $300 million will come from cutting payment rates by 10 percent for non-emergency ambulance services used by patients with end-stage renal disease. There is also $1.8 billion projected to be saved by reducing reimbursement for multiple therapy procedures when performed on the same day.

The bill is a mixed bag in that it would require that hospitals pick up nearly half of the approximately $30 billion cost of stopping the 27% payment cut. The legislation will reduce hospital payments in two ways: number one, it will cut $10.5 billion from projected Medicare hospital payments over 10 years for inpatient or overnight care; number two, it will reduce Medicaid disproportionate share payments to hospitals by an additional $4.2 billion over the next decade.

Statements from stakeholders:

American Hospital Association

Federation of American Hospitals

National Association of Public Hospitals and Health Systems