Lindsay Holland, MHA, Director, Care Transitions Health Services Advisory Group (HSAG)

1. Skilled Nursing Facility Value-Based PurchasingGreater Los Angeles Care Coordination Learning and Action Network Lindsay Holland, MHA, Director, Care Transitions Health Services Advisory Group (HSAG) July 14, 2017

2. Objectives • Describe the skilled nursing facility (SNF) Value-Based Purchasing (VBP) Program • Compare the hospital and skilled nursing facility readmission penalties • Identify how the penalty impacts your facility

3. Hospital Readmission Penalties Section 3025 Affordable Care Act of 2010 • 2017: 139 California hospitals were penalized ALL 5 years for excess readmissions • Congestive heart failure • Coronary artery bypass graft • Acute myocardial infarction • Pneumonia • Chronic obstructive pulmonary disease • Total knee and hip arthroplasty

4. Nursing Home Readmission VBP Program H.R. 4302 Protecting Access to Medicare Act of 2014 • October 2017 • Readmission rates go public on Nursing Home Compare • October 2018 • VBP program for nursing homes begins

5. SNF Readmission Penalty Timeline Oct. 2018 • Incentive/ penalty goes live 40% of SNFs nationally will receive a penalty Oct. 2016 “Potentially preventable” adjusted rate 2014 Passed Oct.2017 Oct.2015 Oct.2016 $2B Savings/10 years October 2018 2014 Oct. 2018 • 2% withhold of SNF payments begin Oct. 2017 • Public reporting of SNF readmissions Oct. 2015 • All-cause readmission measure defined 50–70% of the withhold will go to incentive payments to SNFs 30–50% of the withhold will go to Medicare for savings • https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/Other-VBPs/SNF-VBP.html

6. Nursing Home Readmission VBP Program Reduction amount: 2% • Lowest performers may lose 2% of Medicare funding Program is designed to save money for CMS* • Top performers’ incentive payments 50–70% of the reduction amount (1.0–1.4%) SNFs will be ranked • Bottom 40% will be in the penalty-eligible range CMS provides reports on the measure • So SNFs can review and plan for action • Began 10/1/2016 40% *Centers for Medicare & Medicaid Services

7. Nursing Home Readmission VBP Program (cont.) One measure: an all-condition, risk-adjusted, potentially avoidable hospital readmission rate • Payment differentials begin fiscal year (FY) 2019. • Payments on or after 10/1/2018 • Calculation of VBP amount will use the “achievement/improvement” methodology used for hospital VBP. • Rates will be compared to thresholds and benchmarks • SNFs will be awarded points for either achievement or improvement, whichever is higher

8. 30-Day All-Cause SNF Readmission Measure (SNF-RM) FY 2016 SNF Prospective Payment System (PPS) final rule, CMS adopted the SNF-RM as the first measure for the SNF VBP Program. • The measure is the risk-standardized rate of all-cause, unplanned hospital readmissions of Medicare beneficiaries within 30 days of discharge from their prior hospitalization. • Hospital readmissions are identified through Medicare hospital claims (not SNF claims). • Readmission data are not collected from SNFs and there are no additional reporting requirements for the measure.

9. 30-Day All-Cause SNF-RM (cont.) • Readmissions to a hospital within the 30-day window are counted if: • The beneficiary is readmitted directly from the SNF, or • After discharge from the SNF • As long as the beneficiary was admitted to the SNF within 1 day of discharge from a hospital stay • Excludes planned readmissions • Is risk-adjusted based on: • Patient demographics • Principal diagnosis from the prior hospitalization • Comorbidities • Other health status variables that affect probability of readmission

10. 30-Day SNF Potentially Preventable Readmission (SNF-PPR) Measure July 29, 2016, CMS adopted the SNF-PPR measure for future use in the SNF VBP Program • The SNF-PPR measure assesses: • Risk-standardized rate of unplanned, potentially preventable readmissions • Medicare FFS SNF patients • Within 30 days of discharge from a prior hospitalization

11. 30-Day SNF-PPR Measure (cont.) • The key difference between the SNF-RM and SNF-PPR measures: • CMS will replace the SNF-RM with the SNF-PPR “as soon as practicable.” SNF-RM All-Cause Readmissions SNF-PPR Potentially Preventable Readmissions

12. Performance Scoring CMS has adopted these scoring methodologies to measure SNF performance that include levels of achievement and improvement: • Achievement scoring • Compares an individual SNF’s performance rate in a performance period against all SNFs’ performance during the baseline period • Improvement scoring • Compares a SNF’s performance during the performance period against its own prior performance during the baseline period

13. Definitions for SNF VBP Program

14. Performance Standards Like mortality rates, the lower the readmissions rate, the better. As with the Hospital VBP Program, mortality rates are inverted to a “survivability” rate so that higher is better (1 – mortality rate). Since a lower readmissions rate is better, every SNF’s readmissions rate is inverted using (1 – readmissions rate) for the purposes of the performance standards (i.e., benchmark and threshold) and performance scoring.

15. Calculating SNF Performance for SNF VBP • Performance scores will be calculated under the SNF VBP Program by first inverting SNF-RM rates using the following calculation: • SNF-RM Inverted Rate = 1 – Facility’s SNF-RM Rate • Example: SNF readmissions rate of 20.449% • SNF-RM Inverted Rate = 1 – 0.20449 • SNF-RM Inverted Rate = 0.79551

16. SNF VBP Scoring Methodology Achievement Scoring Achievement Score: For FY 2019, points awarded by comparing the facility’s rate during the performance period (CY 2017) with the performance of all facilities nationally during the baseline period (CY 2015) CY 2015 Baseline Period CY 2017 Performance Period Time 100 points Rate better or equal to benchmark Rate between the two (formula in final rule) 1–99 points 0 points Rate worse than achievement threshold https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/Other-VBPs/SNF-VBP.html

17. SNF VBP Scoring Methodology Improvement Scoring Improvement Score: Points awarded by comparing the facility’s rate during the performance period (CY 2017) with its previous performance during the baseline period (CY 2015) CY 2015 Baseline Period CY 2017 Performance Period Me! Me! Time 1–89 points Awarded according to the formula described in the final rule https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/Other-VBPs/SNF-VBP.html

18. Accessing Your SNF VBP ReportCMS QIES* Systems Welcome Page *Quality Improvement and Evaluation System (QIES)

19. CASPER* Login Page *Certification and Survey Provider Enhanced Reports

20. CASPER Topics Page

21. CASPER Reports Page

22. Additional Information • For more information about the SNF VBP Program: • https://www.cms.gov/Medicare/Quality-Initiatives-Patient-Assessment-Instruments/Value-Based-Programs/Other-VBPs/SNF-VBP.html • Refer to:FY 2016 SNF-PPS final rule andFY 2017 SNF-PPS final rule • For additional questions, email: SNFVBPinquiries@cms.hhs.gov

23. Thank you! Lindsay HollandDirector, Care Transistions, HSAGLholland@hsag.com

24. This material was prepared by Health Services Advisory Group, the Medicare Quality Improvement Organization for California, under contract with the Centers for Medicare & Medicaid Services (CMS), an agency of the U.S. Department of Health and Human Services. The contents presented do not necessarily reflect CMS policy. Publication No. CA-11SOW-C.3-07132017-01