Tag Archives: Carol Bazell

How can Middle Eastern countries successfully adopt value-based care models?

Health systems in many countries in the Middle East are currently undergoing radical transformations as they strive to balance quality, cost and access to healthcare. Healthcare spending continues to increase, driven by the region’s growing healthcare consumerism, ageing populations and the increasing prevalence of chronic conditions and lifestyle diseases.

As providers, payers and patients alike recognise that the current healthcare financing framework—a predominantly fee-for-service (FFS) environment—is not sustainable, a key focus for reform in the region is developing high-value provider reimbursement models that tie healthcare spending to the achievement of the best possible health outcomes. A value-based healthcare system encourages the efficiency of hospitals and clinics in ways that optimise the services they provide. By tying payment to the value of services provided instead of just the quantity of services, value-based payment incentivises providers to give the best possible care to patients in order to maximise health outcomes, patient safety, patient experience and efficiency.

Countries like the United Arab Emirates and the Kingdom of Saudi Arabia have recognised this need and are leading the region’s initiatives to adopt value-based healthcare. The successful adoption of value-based care in the Middle East faces important challenges. In this article, Milliman’s Lalit Baveja, Alison Counihan, and Carol Bazell discuss six of those challenges.

Proposed rule may change prescription drug rebates

The Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS) recently issued a proposed rule it believes “may curb list price increases, reduce financial burdens on beneficiaries, lower or increase Federal expenditures, improve transparency, and reduce the likelihood that rebates would serve to inappropriately induce business payable by Medicare Part D and Medicaid MCOs [managed care organizations].”

The HHS OIG proposes changes to the Anti-Kickback Statute (AKS) safe harbors to ban rebate arrangements it believes are harmful, while protecting discount and service arrangements it believes are beneficial. The proposal applies to both Medicare Advantage and Managed Medicaid.

The broad AKS prohibits payments to induce or reward the referral of business reimbursable under any of the federal healthcare programs. Since the inclusion of remuneration under the AKS in 1977, HHS OIG has established various safe harbors to protect what it deems certain non-abusive business arrangements, while encouraging beneficial or innocuous arrangements.

The discount safe harbor currently allows the payment of rebates by manufacturers to payers, which are often offered in exchange for favorable formulary status. In most cases, Current Manufacturer Rebates—rebates offered by prescription drug manufacturers to pharmacy benefit managers (PBMs) and health plans—are expressed as a percentage of list price, so as list prices increase, the dollar value of rebates also increases. Additionally, price protection rebates, which are a form of manufacturer rebates designed to limit the impact of list price increases on payers, have also become more common and represent an increasingly large share of Current Manufacturer Rebates.

Between 2010 and 2015, the amount of all forms of rebates received by Medicare Part D sponsors and their PBMs increased nearly 24% annually, much faster than the overall growth in gross drug costs in that same time period. The Centers for Medicare and Medicaid Services (CMS) Office of the Actuary projects rebates of all forms to comprise nearly 27% of Medicare Part D gross drug costs in 2020.

Some of the proposed change to the AKS safe harbors include:

• Removing safe harbor protection for prescription drug manufacturer rebates to plan sponsors under Medicare Part D and Medicaid MCOs as well as PBMs under contract with them
• Adding safe harbor protection for certain price reductions offered by prescription drug manufacturers to Part D plans and Medicaid MCOs that are reflected at the point of sale to the beneficiary
• Adding safe harbor protection for fixed fees that prescription drug manufacturers pay to PBMs for services rendered to the manufacturers that meet specified criteria

Beyond Part D plan bids, the proposals, if finalized, are far-reaching and represent significant changes from the status quo. Health plans, PBMs, retail pharmacies, prescription drug wholesalers, and any number of entities that serve these organizations will, in some cases, need to reorient entire business models and restructure back-end operations to manage the new paradigm. For them, implementation on January 1, 2020, may appear an impossible task; however, given this administration’s focus on lowering prescription drug costs, the impossible may indeed become reality.

In this article, Milliman’s Maggie Alston, Carol Bazell, and David Mike write about how these proposed changes could affect Part D stakeholders.





Real-world evidence presents immense potential when done right

Real-world evidence (RWE) is key to understanding health-related experience in everyday settings. Stakeholders seek to use RWE for specific reasons related to their roles in healthcare innovation and decision-making. For example, health insurers may use it to make determinations about coverage and benefit design for specific medical products or services. Healthcare providers may use RWE to develop evidence-based clinical guidelines and to develop tools to guide a patient’s clinical care.

RWE relies on dependable real-world data (RWD). Administrative claims data, a type of RWD, offer a valuable combination of costs and information on patients’ diagnoses and service usage that can be leveraged for population estimates of important clinical and economic measures of healthcare.

As RWE plays an increasingly important role in healthcare decision-making, the translation of RWD into actionable and meaningful evidence requires the use of high-quality data and rigorous, meticulously developed analytic methodologies in order to establish confidence in the findings.

In this paper, Milliman consultants discuss using administrative claims data to expand the use of RWE in healthcare decision-making.





ACOs have more flexibility to establish beneficiary incentives under Pathways to Success

In August, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that will significantly change the Medicare Shared Savings Program (MSSP) if enacted. The proposed rule, known as “Pathways to Success,” provides new flexibilities for accountable care organizations (ACOs) to offer monetary beneficiary incentive programs. Beginning as early as July 2019, CMS proposes to allow certain MSSP ACOs to provide general monetary incentive payments to beneficiaries who receive primary care services in order to foster greater patient engagement.

In this paper, Milliman’s Carol Bazell, Susan Philip, and Laurie Lingefelt discuss key elements related to beneficiary incentives proposed under Pathways to Success. This paper is the fifth in a series of Milliman papers on the proposed rule.





Are preference-sensitive surgical procedures a significant cost contributor for Medicare?

Medical conditions with more than one treatment option are termed preference-sensitive conditions. For many preference-sensitive conditions, surgery is one of several treatment options, and in some instances, several types of surgical procedures are available to treat a single condition. Surgical procedures for the subset of preference-sensitive conditions with surgery among their treatment options are termed preference-sensitive surgical procedures (PSSPs).

Variation in rates of surgery for preference-sensitive conditions commonly reflects a lack of strong clinical evidence or an unresolved debate about the efficacy of treatments. For example, greater disagreement among surgeons about the effectiveness of a procedure increases the likelihood of its geographic variation.

There is no industry standard definition or list of PSSPs, and no comprehensive list of PSSPs has been published. In addition, the contribution of PSSPs to total population costs has not been previously reported. However, shared decision-making (SDM) provides patients with a review of conservative and invasive treatment options. Its greatest impact is expected to be on the treatment of preference-sensitive conditions, including the use of PSSPs. Studies demonstrate the potential for the wider adoption of SDM to reduce healthcare costs because as many as 20% of patients who participate in SDM choose less invasive surgical options and more conservative treatment than do patients who do not use decision aids.

In this paper, Milliman’s Kate Fitch, Carol Bazell, and Sumudu Dehipawala focus on 15 PSSPs that may be performed to treat certain preference-sensitive conditions that have surgical treatment options. Their interest is in quantifying the incidence and cost of PSSPs for the Medicare fee-for-service (FFS) population and identifying areas of spending that may provide opportunities for reducing medically unnecessary utilization.





Two proposed rules open up opportunities for care coordination through telehealth

Over the summer, the Centers for Medicare and Medicaid Services (CMS) issued two proposed rules that will create mechanisms for some providers to receive payment for telehealth as well as other non-face-to-face and care coordination services using telecommunications technologies. Together, the changes proposed in the calendar year 2019 Medicare Physician Fee Schedule (PFS) and the Medicare Shared Savings Program (MSSP) proposed rules have the potential to enable new interactions that strengthen care access and coordination for a much broader set of patients.

The term “telehealth” is often used to broadly refer to the use of telecommunication technologies to furnish healthcare services. However, Medicare telehealth services specifically refer to a set of Part B-covered services specified under section 1834(m) of the Social Security Act. By law, Medicare fee-for-service (FFS) telehealth services under the PFS are currently subject to the following conditions:

• Provided using real-time, interactive audio and video
• Geographic restrictions on originating site (beneficiary location)
• Setting restrictions on distant site (provider location)
• Provider restrictions (and possibly further limitations due to state licensure laws)
• Limitations on type of visits

Waivers of Medicare telehealth rules are currently available under specific CMS Center for Medicare and Medicaid Innovation models. For example, under the existing Next Generation ACO Model, CMS has waived the geographic and originating site requirements for Medicare telehealth services. In addition, beginning in 2018, the Next Generation ACO Telehealth Waiver was expanded to include asynchronous telehealth services for teledermatology and teleophthalmology, which provides physician payment for the receipt and analysis of remote, asynchronous images for dermatologic and/or ophthalmologic evaluation.

MSSP accountable care organizations (ACOs) do not currently have such flexibility because no telehealth waivers are available to them. However, under the MSSP proposed rule, for 2020, CMS has proposed changes for telehealth services provided by ACOs that take on two-sided risk. Specifically, CMS proposes to expand the use of telehealth by ACOs by removing the geographic and originating site restrictions on these services. This means that ACOs will be able to provide telehealth services to beneficiaries in their homes as well as for beneficiaries obtaining care in metropolitan statistical areas (MSAs).

In addition, under the PFS proposed rule, CMS proposes to provide separate payment for new non-face-to-face services, virtual check-in visits, chronic care remote physiologic monitoring, interprofessional consultation, and remote professional evaluation of patient-transmitted information.

In this paper, Milliman’s Susan Philip, Carol Bazell, and Laurie Lingefelt describe these changes in greater detail and also discuss the possible implications for providers and MSSP ACOs in particular.