Medicare & Reimbursement Advisor Weekly – HCPro

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Medicare & Critical insight for
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            4        5       6
                                           Infusion reimbursement drop would shift Medicare
             July 15th, 2009
                Vol. 5 No. 23
                                           patients to hospitals
          In this issue                    by Bryan Cote                                                       39.7%; other biologics would drop signifi-
                                                                                                               cantly in 2010 as well, likely redirecting at
1  Infusion market changes
                                           If Medicare has its way, it will eliminate all                      least some portion of Medicare beneficia-
                                           the gains achieved several years ago in infu-                       ries to the hospital setting, says Joel Brill,
2  MTM conversation                        sion reimbursement for physician offices.                           MD. This could have a ripple effect in fur-
                                           The infusion codes were revised a few years                         ther straining hospital formularies, reducing
2  Survey snapshot
                                           ago to help offset average sales price (ASP)                        access, and creating higher plan costs. This
3  What do readmissions mean               reimbursement, but it appears they would                            is an "if" scenario since the reimbursement
   to product adoption?                    take a hit due to redistribution of practice                        rates here are proposed. A final fee schedule
5  June Medicare readmissions,             expenses based on the AMA's supplemental                            is due in November.
   St. Joseph Hospital                     physician survey. Using the chart below,
                                           you can see that reimbursement for infusing                         The use of orals and injectables
5  Reporter's Notebook
                                           chemotherapy for the first hour would drop                          could, in theory, benefit in a lower > p. 2


                                                                                                                     % change           2010         % change
                                           2009          2010 facility          2009           2010 proposed           2009          proposed          2009
                                          facility        proposed             facility          facility fee         to 2010       facility fee      to 2010
   CPT      Short descriptor            total RVU         total RVU              fee           (21.5% CF cut)        proposed        (2009 CF)       proposed
 *96360    Hydration IV                     1.57              1.30             $56.62                $36.82            -35%            $46.89          -17%
           infusion, init
 *96361    Hydrate IV                       0.46              0.35             $16.59                 $9.91           -40.3%           $12.62          -24%
           infusion, add-on
 *96365    Ther/proph/diag                  1.91              1.65             $68.89                $46.73           -32.2%           $59.51          -14%
           IV inf, init
 *96366    Ther/proph/diag                  0.61              0.53                $22                 $15.01          -31.8%           $19.12          -13%
           IV inf addon
 *96372    Ther/proph/diag                  0.58              0.60             $20.92                $16.99           -18.8%           $21.64           3%
           inj, sc/im
 *96374    Ther/proph/diag                  1.51              1.28             $54.46                $36.25           -33.4%           $46.17          -15%
           inj, IV push
 96413     Chemo, IV                        4.09              3.14             $147.51               $88.93           -39.7%          $113.25          -23%
           infusion, 1 hr
 96415     Chemo, IV                        0.93              0.71             $33.54                 $20.11          -40.1%           $25.61          -24%
           infusion, addl hr
 96417     Chemo, IV infus                  2.04              1.57             $73.58                $44.46           -39.6%           $56.62          -23%
           each addl seq




                                                                                                                                                                 1


                         HCPro, Inc.  200 Hoods Lane  Marblehead, MA  p. 860/232-6377  f. 781/639-0179  bcote@hcpro.com  www.hcpro.com
                                                                   2009 All Rights Reserved, HCPro, Inc.
           Medicare & Critical insight for
       Reimbursement managed markets
       Advisor Weekly professionals
              1      2       3
                                                                  Contents          |   Survey snapshot         |   Reporter's notebook        |   Contact us


              4      5       6             Infusion reimbursement                                    < p. 1


  Survey snapshot                         infusion reimbursement market. As we've                            Setting? Our conclusions could be helpful in
                                           reported, the effect of a shift of Medicare                        understanding the effects these changes may
Account management                         beneficiaries to hospitals produces                                have on access and quality of care: Thirty-
success                                    tighter margins and indirectly affects phar-                       eight percent of 302 responding physicians
"What impresses me when I talk             macy and medical spend, says Faye Satterly,                        said it would help to have drugs that allowed
to a national or regional account          director of Martha Jefferson Hospital's                            more infusions per hour, and 78% of 54
manager is that they have a good           cancer center in Charlottesville, VA. The                          hospitals surveyed said they would consider
understanding of managed care              changes in physician office infusion reim-                         being more aggressive in urging physicians to
and Medicare Part D and our                bursement would hit at the same time as a                          select "cheaper drugs" for infusions, based on
benefit design. It's sometimes frus-       drop in hospital reimbursement to ASP+4%.                          tightening margins. n
trating if I spend the first several
meetings explaining managed
                                           In the wake of the 2003 Medicare reim-                             Editor's note: If you are interested in study-
care. It's good if the account man-
                                           bursement changes, we studied the poten-                           ing the potential effect of these proposed
ager can come in and ask me,
                                           tial impact in our report, What If Cancer                          changes, please contact me to discuss.
`What do you take into consider-
                                           Care Shifts to the Hospital Outpatient                             BC (860/712-8960)
ation when adding a drug?'

"I take therapeutic indication,
safety profile, efficacy, cost-effec-
tiveness, treatment guidelines,
                                           Greater payer MTM investment, reimbursement
and standard of care into consid-          presents opportunities to make claims about
eration. We have to work within
CMS guidelines, but it's also very         drug profile
important to us to ensure that the
patients have desired health out-          by Bryan Cote                                                      Patients will be eligible for the plan's MTM
comes. If our formulary decision                                                                              services if they have any three of the core
improves outcomes, it will help            As you may know, Medicare Part D MTM                               conditions in Figure 1 (see p. 3) and take a
on the medical side, and [in] my           programs are changing again for 2010 to                            minimum of five medications from KP's list
opinion, on the drug side as well,         include more patients, with lower drug spend                       of drug classes. Patients must have an annual
by decreasing the need for other           but more conditions. Here's how the changes                        minimum drug spend of $3,000, a drop
meds due to side effects or pro-           will play out in California with Kaiser                            from the current $4,000 cutoff. If patients
gression of their disease state."          Permanente (KP) and how its program has                            meet these criteria, they must opt out if they
                                           worked so far. KP's MTM program used to                            do not wish to be contacted (as opposed to
       --Ronnie DePue, former              target its entire eligible population, taking                      some plan MTM programs that use an opt-
Coventry pharmacy director for             all comers in a more global approach. But                          in model).
Medicare, on account manager               many didn't have significant interventions
success. To access our Account             after their complete med reviews with the                          One targeted population is looking at
  Manager Success Files series,            KP-employed ambulatory care pharmacist.                            patients discharged from the hospital in the
 contact me for a copy (bcote@             Now, KP is trying to target special popula-                        past week. KP does this every week. It looks
   hcpro.com or 860/232-6377).             tions or use key patient lists by using its inte-                  to its EMR from all of its California medi-
                                           grated EMR, KP HealthConnect, to identify                          cal centers and gets a list, by center, of all
                                           where the most critical need is.                                   discharges. The list can be broken > p. 3

                                                                                                                                                                2


                         HCPro, Inc.  200 Hoods Lane  Marblehead, MA  p. 860/232-6377  f. 781/639-0179  bcote@hcpro.com  www.hcpro.com
                                                                   2009 All Rights Reserved, HCPro, Inc.
                  Medicare & Critical insight for
              Reimbursement managed markets
              Advisor Weekly professionals
                            1             2            3
                                                                                       Contents          |   Survey snapshot       |   Reporter's notebook          |   Contact us


                            4            5             6        MTM investment                          < p. 2


                                                                out by type of discharge or admission, such                       Figure 1
                                                                as those for chest pain. The list is then com-
                                                                                                                                  Core conditions
                                                                pared to the eligible MTM population KP                           KP criteria: Minimum of 3 conditions;
                                                                has for the program year, and any matches                         minimum of 5 medications overall
                                                                are referred to the KP-employed ambulatory                        Arthritis: Osteoporosis
                                                                care pharmacists for workup (med reconcili-
                                                                                                                                  Arthritis: Osteoarthritis
                                                                ation, review of discharge orders, discussion
                                                                of meds). To date, there have been fewer                          Rheumatoid arthritis
                                                                readmissions for the MTM group compared                           Congestive heart failure
                                                                to those not receiving MTM services.                              Diabetes
                                                                                                                                  Dyslipidemia
                                                                "Often, patients get new meds at discharge,                       Hypertension
                                                                so we can identify patients going home and
                                                                                                                                  Respiratory: Asthma
                                                                reach out to them at an important time and
                                                                                                                                  Respiratory: COPD
                                                                prevent readmissions or address bigger-pic-
                                                                ture issues with their treatment," says Erwin                     Respiratory: Chronic lung disorder
                                                                Jeong, RPh, a pharmacist at KP in Southern                        Mental health: Depression
                                                                California.                                                       Mental health: Schizophrenia
                                                                                                                                  Mental health: Bipolar
                                                                Some KP ambulatory care pharmacists have
                                                                                                                                  Mental health: Chronic and disabling
Editorial advisory board                                        signed collaborative practice agreements
Ronnie J. DePue, RPh, PharmD                                    with doctors to allow them to adjust doses,                      Source: Kaiser Permanente.
Joel Brill, MD                                                  switch medications, or initiate therapy.
Chief Medical Officer
Predictive Health
Michael Yanuck, MD                                              Other examples of targeted populations                           Jeong says the program can help get patient
Michael Yanuck Medical Consulting
                                                                include using KP's lab data access to pull                       LDLs, for example, under control. Eligible
Susan Slaton
Director of Reimbursement                                       a list of anyone with LDL-Cs greater than                        MTM patients in skilled nursing settings and
BayerHealthcare                                                                                                                  hospice are enrolled into the program using
                                                                100 or using pharmacy data to pull lists of
Matthew Murawski, RPh, CGP
Associate Professor of Pharmacy                                 patients on drugs to be avoided in the elderly.                  the opt-out method. n
Purdue University
Howard Tag
Tag & Associates
Dawn Holcombe
The Oncology Network                                            Reducing readmission: Can your products align with
Lynn Veith, RN, Administrator
McLean Nursing Home                                             payer, hospital financial goals?
Todd Michael, MS, MBA
Healthcare Economics
Baxter BioScience                                               by Bryan Cote                                                    are indirect financial benefits for adopting
Medicare & Reimbursement Advisor Weekly (ISSN: 1937-7541)                                                                        products that keep patients from bouncing
                                                                Reducing hospitalizations is one of the top                      back after discharge.
                                                                benefits that plan medical directors look
                                                                for when evaluating products for formulary                       For example, four readers from five different
                                                                adoption. And in terms of hospitals, there                       pharmaceutical companies recently > p. 4

                                                                                                                                                                                     3


                                              HCPro, Inc.  200 Hoods Lane  Marblehead, MA  p. 860/232-6377  f. 781/639-0179  bcote@hcpro.com  www.hcpro.com
                                                                                        2009 All Rights Reserved, HCPro, Inc.
    Medicare & Critical insight for
Reimbursement managed markets
Advisor Weekly professionals
   1   2       3
                                                    Contents          |   Survey snapshot        |   Reporter's notebook         |   Contact us


   4   5       6             Reducing readmission                               < p. 3


                             asked me whether there's any financial or                        QIOs may go beyond an electronic/distance
                             reimbursement benefit to hospitals that                          review if there's a pattern at the same
                             keep patients out of the acute setting after                     hospital.
                             discharge.
                                                                                              If a hospital is not paid for readmissions
                             Although you don't gain reimbursement by                         and a pattern begins, we're talking about a
                             keeping the discharged patient out of the                        significant revenue loss.
                             hospital beyond 30 days, you do avoid los-
                             ing reimbursement if the patient is readmit-                     What causes readmissions?
                             ted inside a month.                                              Hospitals such as St. Joseph's in Atlanta are
                                                                                              now tracking their readmissions and work-
                             BaCkgRound                                                       ing to reduce their readmission rate and
                             Medicare doesn't want to pay for hospi-                          identify the chief causes. See the chart on p. 5
                             tal readmissions. Under Medicare's 9th                           for analysis of St. Joseph's June readmissions
                             Scope of Work rules, CMS' fiscal interme-                        (also see the July 10 MRAW for readmis-
                             diaries currently monitor hospital readmis-                      sions data). One-third of the readmissions in
                             sions, and if a patient is readmitted at the                     June were related to a precipitating surgery,
                             same facility for the same diagnosis within                      and 25 of those bounced back within five
                             30 days of discharge, the intermediary                           days, says Anne Pedersen, RN, the hospital's
                             flags and sends an electronic note to the                        care management director.
                             state Quality Improvement Organization
                             (QIO).                                                           HeaRt FailuRe/CHeSt Pain examPle
                                                                                              The DRG for congestive heart failure is 293
                             The QIO then contacts the hospital ask-                          (if the patient does not have other major
                             ing for documentation and background                             comorbid conditions). Reimbursement under
                             records (e.g., the patient's discharge plan                      this DRG has a blended payment rate. For
                             and care plan).                                                  example, if a patient enters the hospital
                                                                                              within 30 days of discharge for the same
                             The QIO reviews the records and has the                          DRG, the average blended rate for hospi-
                             authority to deny payment for the readmis-                       tals concerning this DRG comes to about
                             sion if it believes there's enough evidence                      $4,500. But the cost of the second admission
                             that the hospital could have avoided the                         may be higher if you factor in two to three
                             readmission or if the documentation or dis-                      days' worth of emergency department costs,
                             charge plan are not of good quality.                             supplies, and nursing time. The hospital eats
                                                                                              these costs if the QIO determines that the
                             Generally, if the QIO determines that there                      discharge plan documentation or plan of
                             was not a great effort to get the patient                        care were not adequate.
                             the best discharge at the next best level of
                             care (i.e., a skilled nursing facility), the hos-                meSSage
                             pital will not be reimbursed for the second                      If your product keeps the coronary artery
                             readmission.                                                     stable and patients out of the hospital > p. 5

                                                                                                                                                  4


           HCPro, Inc.  200 Hoods Lane  Marblehead, MA  p. 860/232-6377  f. 781/639-0179  bcote@hcpro.com  www.hcpro.com
                                                     2009 All Rights Reserved, HCPro, Inc.
    Medicare & Critical insight for
Reimbursement managed markets
Advisor Weekly professionals
   1    2       3
                                                     Contents          |   Survey snapshot       |   Reporter's notebook          |   Contact us


   4    5       6             Reducing readmission                               < p. 4


                              for more than 30 days, the drug indirectly                       reduce so-called bouncebacks and have hos-
                              helps hospitals avoid revenue/reimburse-                         pital staff work more in collaboration with
                              ment loss. CMS' goal is to help save $17                         the community (doctors, nurses, skilled nurs-
                              billion through these efforts. It wants to                       ing, etc). n


                               JUNE MEDICARE READMISSIONS
                               Number of readmissions, June 2009                                                  77
                               Medicare discharges                                                                595
                               Readmission rate                                                                   12.9%
                               Average days between readmissions                                                  10.4%
                               Average length of stay for readmission                                             5.19%
                               Hospice/expired                                                                    12 (15.6%)
                               Precipitated by OR                                                                 27 (35.6%)
                               Common primary diagnosis at readmission                                            UTI, sepsis
                               Common secondary diagnosis at readmission                                          ESRD, ARF, Afib

                              Source: St. Joseph's Hospital, Atlanta, and HCPro 2009 Readmissions Study.




Reporter's                    Access to meds difficult for Medicaid
       notebook               Medicaid's cumbersome policies often lead                        providers and plans, whose officials say that
                              to patients not getting or filling their pre-                    getting those people eventually re-enrolled
                              scriptions, receiving important diagnostic                       becomes an even bigger administrative and
                              tests, or managing their chronic diseases,                       costly headache.
                              which will lead to more costs down the road,
                              according to a new report released by the                        Officials from several health plans say cre-
                              Association for Community Affiliated Plans                       ating policies that provoke churning is a
                              (www.communityplans.net).                                        common practice in states that are trying to
                                                                                               reduce costs.
                              Under current practice, the report estimates,
                              Medicaid will cover 68 million people dur-                       "States use the redetermination process to
                              ing the course of this year, but 13 million                      save money in times of tight budgets," says
                              will not be enrolled in any given month                          Elaine Batchlor, MD, chief medical officer at
                              mainly because their eligibility expired and                     LA Care, a Medicaid plan with 750,000 mem-
                              they did not have a chance or the means to                       bers. "They tend to increase the frequency of
                              renew it. That results in lowered payments                       redetermination; that's one way to decrease
                              from the state and federal government to the                     the number of people covered." > p. 6

                                                                                                                                                   5


            HCPro, Inc.  200 Hoods Lane  Marblehead, MA  p. 860/232-6377  f. 781/639-0179  bcote@hcpro.com  www.hcpro.com
                                                      2009 All Rights Reserved, HCPro, Inc.
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