[email protected] Physician Groups Nationwide Benefit from CAPG October Symposium, “How to Thrive in Risk-Based Coordinated Care” October 27, 2016, Chicago, IL: Register here http://www.businesswire.com/news/home/20160921005910/en About Amy Nguyen Howell, MD Dr. Howell is a board-certified family practice physician. She is a family physician at Playa Vista Medical Center, and previously served as chief medical officer at Easy Choice Health Plan, a WellCare Company, where she oversaw clinical direction of medical services within appeals and grievances, care management, utilization management and quality improvement. Since March 17, 2014, Dr. Nguyen has been chief medical officer of CAPG, the country’s leading association representing physician organizations practicing capitated, coordinated care. About CAPG CAPG is the nation’s leading association for and the voice of physician organizations practicing capitated, coordinated care. Its membership comprises approximately 250 multispecialty medical groups and independent practice associations (IPAs) across 41 states, the District of Columbia, and Puerto Rico. CAPG members strongly believe that comprehensive, accountable, risk-based coordinated care provides the highest quality, most efficient delivery, and greatest value for patients. Our members have successfully operated under this budget-responsible model for more than two decades. For more information, please visit www.capg.org. The mission of CAPG is to assist accountable physician groups to improve the quality and value of healthcare provided to patients. CAPG represents and supports physician groups that assume responsibility for clinically integrated, comprehensive, and coordinated healthcare on behalf of our patients. CAPG and its member groups will continue to drive the evolution and transformation of healthcare delivery throughout the nation. US Domestic Medical Travel (USDMT): Why does CAPG consider health systems and accountable physician organizations appropriate for membership in the organization? Amy Nguyen Howell (AH): Most hospital systems have a medical group component affiliated with them on their ambulatory primary care side.  These are the groups that would fit perfectly within CAPG’s membership structure, as long as they carried some sort of risk-based, coordinated model of care. Further, our members’ successes are attributable to how well they manage both clinical and financial risk under capitated arrangements. By knowing how to manage risk appropriately, they have prospered in population-based payments and risk-based arrangements. USDMT: Does CAPG extend its reach nationwide? AH: Most definitely. We have a strong footprint in California, but currently have a presence in 41 states. Three years ago, we began to extend our reach and share our expertise nationwide. Today, we continue to attract accountable physician groups and health systems throughout the country because of the tremendous value proposition that we offer to these organizations. Our national and regional symposia are strategically scheduled to make them accessible and convenient for travel. USDMT: What are the key benefits of membership in CAPG? AH: Our members take advantage of several key pillars of our service platform that distinguish our organization from others in the marketplace, such as AMGA. Advocacy is one important component, and CAPG federal advocacy focuses on advancing risk-based alternative payment models in traditional Medicare and Medicare Advantage. In recent years, the organization has seen significant achievement in advancing financial and clinical risk models. Our achievements in 2015 demonstrate the strength of these initiatives. CAPG is protecting and strengthening Medicare Advantage (MA), which we believe offers the best available option for physicians to advance capitated, coordinated care delivery models. Despite its success, Medicare Advantage has faced cuts over a number of years, and these cuts flow to our physicians and their patients. That’s why we established our organization as a leading physician voice protecting MA. Together with our advocacy partners, we have successfully reduced past proposed cuts. In 2015, the Administration proposed a 0.9% cut to Medicare Advantage. CAPG engaged in an intense advocacy campaign to avert these cuts. We are pleased to report that the Administration instead finalized a 1.25 percent increase to MA rates. We have also tackled the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). For years, we worked with Congress to encourage faster and more aggressive development of alternative payment models in Medicare. We are thrilled to see that the SGR repeal law, enacted in April 2015, included a 5 percent incentive payment for organizations participating in risk-based alternative payment models. We have also promoted coordinated, capitated payment models in traditional Medicare, and play a substantial role in pushing for more capitated payment model options. This year, the Administration announced that it would begin testing a capitated accountable care organization payment model, the Next Generation ACO. CAPG looks forward to continuing to work with the Administration to develop this and other models. And we are especially gratified by our role in advancing value-based delivery models. Health & Human Services Secretary Sylvia M. Burwell announced ambitious value goals to transform Medicare from a volume-based system to a value-based system. In essence, the Secretary seeks to transform Medicare payments to the very model that CAPG members have been using for decades. We look forward to working with the Administration to share best practices and provide valuable leadership in this critical transformation. CAPG announced its own ambitious value goal: to move 90 percent of our members’ Medicare payments (Traditional Medicare and Medicare Advantage) to capitation by 2018. Today, we just announced our support for the ACO Improvement Act of 2016, a bipartisan bill introduced by U.S. Representatives Diane Black (R-TN) and Peter Welch (D-VT). The legislation is aimed at improving outcomes for Medicare beneficiaries by making improvements to the Medicare accountable care organization (ACO) program. USDMT: Looking on your website, there’s a significant focus on education. AH: In March 2016, CAPG launched its inaugural Educational Series, Essentials of Risk-Based Payment Models: Moving from Volume to Value. We recognized an ever-growing need for education on risk-based management and coordinated care for our leaders. While national associations, consultants, health systems, state medical societies, and universities have identified the need for courses in leadership and population health management; until now, there is not a single organization that offers managed care tutelage and mentorship at a level of detail that can be operationalized by physician groups. For example, at the recent CAPG Annual Conference attendees received hands-on knowledge and tools to navigate the brave new world of MACRA, MIPS, and APMs. With MACRA right around the corner in almost three months, our members need to quickly address the impact of this game-changing initiative and others that are effectively making value-based payment mandatory for physician organizations. As a result, they are better prepared for alternative payment arrangements with all payers: Medicare, Medicaid, and commercial. Also, CAPG has recently announced support of a new national movement entitled, “A Call for Collaborative Action: Achieving Readiness for a Value Payment World,” led by the Accountable Care Learning Collaborative (ACLC). In an environment where old-school fee-for-service is being replaced by a risk-based care system that emphasizes value over volume to ensure healthier patient outcomes at lower costs, there’s no better time to build on this momentum. A Call for Collaborative Action will bring diverse industry stakeholders together to share their best practices for population health management. In line with the Call for Action, CAPG has a new online hub, www.capg.org/accountablecompetencies, which centralizes the association’s educational resources on accountable care. In adding its support to this influential cause, CAPG joins a number of other prominent healthcare notables including Mike Leavitt, former Utah Governor and U.S. Secretary of Health and Human Services, and Dr. Mark McClellan, director of the Robert J. Margolis Center for Health Policy at Duke University. No other organization is providing this scope and depth of information, education, and training. USDMT: Do you offer any consulting services? AH: CAPG Consulting services are widely accessed throughout the year. They are positioned to serve those entities that are getting ready to take on risk or already in it, CAPG Consulting can help you accelerate your journey. Our team is composed of executives with decades of success in risk-based care delivery at leading physician organizations. With MACRA and other reforms, federal and state governments have confirmed an inevitable drive to alternative payment models. This movement is creating great demand for education and support on how to move into alternative payment models, or APMs. At the same time, CAPG is fortunate to have a group of highly experienced, recently retired physician organization CEOs. They’ve learned what works and what doesn’t, sometimes the hard way. And they want to help others succeed-because they strongly believe risk-based care offers the best outcomes and highest value for patients. NOTE: To learn more and get connected with one of the CAPG experts, contact my colleague Nelson Maldonado at 213.239.5041 or [email protected].  USDMT: Does CAPG advocate any innovative models for direct contracting with payers? AH: I’m glad you asked about this. CAPG continues to work to advance alternatives to Medicare ACOs for groups that are ready for higher levels of risk and reward. We call this alternative “A Third Option.” http://capg.org/ftp/2016CAPGAC/B2_TheMedicareSharedSavingsProgram_McDermott.pdf Here are the highlights:

• Clinically integrated organizations (CIO) would contract directly with CMS
• Beneficiary selects from traditional Medicare, CIO, or Medicare Advantage
• Beneficiary enrolls in the CIO and commits to stay within the CIO for one year

In this model, CIOs would report quality information. Beneficiaries would be able to compare quality across different Medicare options — “apples to apples.” CIOs could receive incentives for quality performance (like Medicare Advantage 5 Star Ratings Program) and could tie individual physician payments to quality as desired. Currently, we have groups like MemorialCare Health System who are doing exciting and innovative direct contracting with prominent employers and following the concept of the Third Option. USDMT: Does CAPG provide guidance on bundled pricing? AH: Absolutely. We have active members like Providence Health Systems who created a bundle care package for elective total knee and hip replacements which helped to improve patient expectations, reduced length of hospital stays, and enhance clinical outcomes. CAPG can facilitate formal and informal networking opportunities for those interested in getting more into bundled payments for their organization. We have a contracts committee whose members often discuss topics like bundled pricing along with other financial contracting elements. USDMT: How does CAPG help support the ACO movement? AH: Recently, CAPG published a comment letter on the policy considerations in CMS/CMMI’s treatment of the interplay between the bundled payment initiatives (bundled payments for care improvement, BPCI, and the comprehensive care for joint replacement, CJR) and the accountable care organization programs (Medicare Shared Savings Program, MSSP, Pioneer, and Next Gen). While we believe that there is great opportunity for these programs to support one another, we believe that current policy may disrupt and undermine the accountable care organization (ACO) programs. This is occurring at the very time when CMS is trying to encourage participation in Advanced Alternative Payment Models, like Next Gen and Tracks 2 and 3 of MSSP. In particular, we are concerned in cases where the ACO operates independently from the hospital participating in the bundled payment model. This is the case for many CAPG members. To illustrate the overlap issue, we will use the CMS guidance for such situations between Next Gen ACOs and BPCI participants. In the example in the guidance, the bundled target price is $10,000. The hospital participating in the bundled payment initiative achieves an actual expenditure of $8,000. The expenditure that is included in the ACO’s reconciliation is $10,000. CMS pays the $2,000 in savings to the hospital, the ACO does not receive any of those savings. Because that $2,000 in savings is credited only to the bundled hospital, the savings opportunity is taken from the ACO. We see two problems with this treatment of overlap situations. First, this approach makes it increasingly difficult for ACOs to achieve savings as compared to an historical benchmark. Second, this approach treats the care associated with the bundled payment episode as separate and distinct from the activities of the ACO, rewarding only the hospital bundler for the savings associated with a bundled payment patient. USDMT: Is capitation a dirty word? AH: Ahh…to some perhaps. At CAPG, this is our bread and butter. Having grown up in California, the land of the delegated, capitated model, we have thrived in pre-payment coordinate care, and we are well-positioned to educate the rest of America on how to prosper in alternative payment models. As we all know, the healthcare delivery system is on a journey from volume to value. A driving force of this change is the offering of new APMs in traditional Medicare. To date, the Centers for Medicare & Medicaid Services (CMS) has offered several options with increasing levels of risk. Relevant to physician organizations, these models tend to be ACOs. ACOs are groups of providers that come together with the goals of coordinating healthcare services to reduce costs and improve quality. However, the delivery system reform options available today are largely focused on the “on-ramp to risk” (e.g., shared savings based on fee-for-service). To continue to drive delivery system reform forward, especially since MACRA has become law, additional models are needed that enable physician organizations to gain experience in taking on more risk. Legislation introduced in the U.S. House of Representatives would help to meet this growing need by testing a new model for patient care networks (PCNs) in Medicare Part A and Part B. A patient care network (PCN) is a new model of integrated care that is made up of (1) a hospital, and (2) participating physician group practices that provide both primary and specialty care to patients in traditional Medicare. Through a PCN physicians, at the group level, would be allowed to directly contract with CMS to negotiate capitated payments for their Part A and Part B patients – a model that does not exist in Medicare today – provided that they meet robust quality and performance standards. The PCN model holds participating practitioners accountable for the quality, cost and overall care that the patients participating in their networks receive. This new model achieves several important objectives. First, it offers an additional option for physicians that want to pursue the advanced APM option under MACRA. Second, it tests a new model of payment that has not yet been tested in traditional Medicare. Third, it builds on the success of models in the commercial and Medicare Advantage space – models that have been proven to increase quality and lower cost for decades. Concurrently, CAPG supports legislative efforts to institutionalize the PCN model, including a bipartisan bill introduced by Congressman Mike Kelly (R-PA) and Congressman Richard Neal (D-MA), H.R. 5841.