AUA Health Policy Basics Course National Health Policy Organizations

1. AUA Health Policy Basics Course National Health Policy Organizations Chris M. Gonzalez MD MBA FACS Professor of Urology Feinberg School of Medicine Northwestern University Chicago, Illinois

2. The RUC meeting, convened by the AMA, evaluated 4 new CPT 1 codes to determine their RVU. CMS approved the panel recommendations; however stated that the GPCI and the PLI portion of the RVU will be modified. The CY 2012 CF was calculated at $24.67. • Studies by the AHRQ and IOMwere included in a MEDPAC report to Congress. A key quality issue related to Medicare part B was identified. The AUA, AACU, and LUGPA discussed. The AUA QIPS committee worked with the SQAand the ACS through the PCPI to develop a new measure. The measure was approved by the NQF.

3. Overview • Government Health Insurance • Structure and Reimbursement Process • Quality Improvement Initiatives and Organizations • Physician Organizations

4. Government Health Insurance Structure and Reimbursement Process

5. Medicare • Health Insurance for the Aged Act • Johnson Administration 1965 • Health insurance for Seniors • Nixon Administration 1972 • Patients with renal failure and chronic disability • Includes 17% of all beneficiaries in 2011 • Seniors qualify for benefits by paying at least 10 years (40 quarters) of payroll taxes • Premium required for non-qualifiers

6. Medicare • Part A • Hospital Insurance program • Acute inpatient stays, skilled nursing facilities, hospice, home health services • Funded by mandatory payroll taxes (workers and employers) • Eligible Medicare beneficiaries automatically enrolled • No co-pay but annual deductible • Part B • Supplementary Insurance Program • Physician services, supplies, outpatient and ambulatory care, durable medical equipment, and laboratory services • Voluntary program • Premium and deductible

7. Medicare • Part C • Medicare Advantage (MMA 2003) • Private insurance distributes Medicare Part A, Part B, and an equivalent to Part D with option of “advantage” • HMO, PPO, PFFS plans • Part D • Subsidized prescription medication coverage • Voluntary • Variable co-insurance rate drug costs > $310 annually • “Doughnut hole”

8. Medicaid • Title XIX Amendment to Social Security Act 1965 • Means tested health care benefits • Primarily state managed • Federal fund distribution based on state needs assessment and compliance with federal oversight • Inpatient, outpatient, nursing home, drug benefit • Special Considerations • Dual eligible (Medicare and Medicaid eligible) • Children • SCHIP or CHIP (Children’s Health Insurance Program)

9. Medicare Payment Advisory Commission (MEDPAC) • Balanced Budget Act of 1997 • Advisory group to Congress on payment and quality of the Medicare program; makes non-binding recommendations • 17 members with staggered three year terms • 2 practicing physicians • Broad oversight and mandate • Access, quality, payments to private insurance, GME payment recommendations

10. Center for Medicare and Medicaid (CMS) • Previously known as HCFA (Health Care Financing Administration) • Changed name to CMS in 2001 • Head of CMS is a presidential appointee • Administration, coordination, and oversight of Medicare and Medicaid • Interprets and implements Congressionally passed health care law through issuance of regulation for both programs in the federal register

11. Common Procedural Terminology (CPT) • Descriptive terms and identifying codes for reporting of provider services and procedures • Adopted by CMS in 1983 as official Healthcare Common Procedure Coding System (HCPCS) • Five digit numeric or alpha numeric codes • CPT 1 • Well established service or procedure • Reimbursed for this service or procedure • CPT 2 • Data collection, measure performance • CPT 3 • Temporary codes used to assess emerging technology

12. Common Procedural Terminology (CPT) • Evaluation and Management (E&M) codes • Patient encounters • Office, hospital, consults (newor established) • Codes 99201 – 99499 • Procedure codes • Diagnostic and treatment codes • Surgical, anesthesia, radiology, laboratory • Urology specific codes 50010 – 55899 • Cystectomy (51596), Cystoscopy (52000) • Modifiers • E&M and Procedure codes • Lengthy discussion (E&M) • Two surgeons, need for assistant surgeon (procedure) • Global period

13. International Classification of Disease (ICD) • First developed by World Health Organization in 1948 • Official use in the United States started in 1989 • ICD – 9 CM (9th revision) (Clinical modification) • 10th revision planned October 2014 • Codes represent signs, symptoms, complaints, diagnosis • Justify medical necessity for the patient encounter • Code specificity • Three to five digits • Bladder neck obstruction 596 • Renal mass 593.9 • Urinary frequency 788.41

14. Relative Value Scale (RVS) • Links monetary value to a CPT 1 code for provider reimbursement • Government reimbursement system • Resource based relative value scale (RBRVS) • Developed by statistician William Hsiao (1985) • Medicare adopted in 1992 • Private insurers begin to use 1995 • Modified RBRVS • Process where relative value unit (RVU) are updated and adjusted

15. CMS Payments Surgery vs. Office Visits 1990-2011**US Bureau of Labor Statistics $1.00 in 1990 = $1.68 in 2011

16. Medicare Physician Payment Scale • Work RVU component (52%) • Time, skill, stress, intensity, risks • Practice expense RVU component (44%) • Staff, supplies, rent • Malpractice RVU component (4%) • Professional liability insurance (PLI) • Multiply total RVU by a conversion factor (CF) for monetary value

17. Medicare Physician Payment Scale RVU Work x Geographic Practice Cost Index (GPCI) + RVU Practice Expense x PE GPCI + RVU Malpractice x PLI GPCI Total RVU Dollar amount for service: Total RVU x CF for CY 2012 ($24.6712) = Payment

18. Relative Value Scale Update Committee (RUC) • Peer review group convened by the AMA • Payment for service determined by this committee • Multispecialty representation – 31 seats • CMS triggers for RUC review • New technology • Volume (billed > 500,000 per year) • Billed 75% of the time with another code (bundle) • CMS specific request (fast growing)

19. Relative Value Scale Update Committee (RUC) • Specialty survey data acquisition from membership • Compile data into a case to retain reimbursement • Determine physician work and practice expense component of the RVU • Specialty presents proposed RVU of the service to the RUC • CMS involved in the peer review process

20. Recovery Audit Contractor (RAC) • Medicare Modernization Act of 2003 • Recover improper Medicare payment claims • Initial demonstration program involving five states recovered nearly 700 million dollars • Private contractors hired by CMS to “audit” physician offices or practices • Medicare Part A and B billing • Award up to 12.5% of dollars corrected • FY 2010 - 92.3 million dollars discovered in improper payments • 82% overpayment and 18% underpayment

21. Recovery Audit Contractor (RAC) • CMS must approve potential issue raised by RAC • CMS oversight of process through RAC data warehouse • Review process • Automated review • Analytics used to review claims • Complex review • Review medical records on site • If overpayment is determined a “demand letter” is sent to the institution • Appeals process

22. Quality Improvement Initiatives and Organizations

23. Physician Consortium for Performance Improvement (PCPI) • National physician led effort to improve health care quality, patient safety, efficiency • Over 70 medical specialties involved • Convened and staffed by the American Medical Association • Evidence based physician level measure development • Identify areas of quality improvement with specialty collaboration • Vote on proposed measures

24. National Quality Forum (NQF) • Formed in accordance with National Technology Transfer and Advancement Act of 1995 • Voluntary, consensus-based organization, formed to endorse existing measures after expert panel and member review • Health care stakeholders • Eight councils over 300 members • Professionals, public health, consumers, purchasers, industry • NQF approved measures “special status” • PCPI vetted measures

25. Institute of Medicine (IOM) • Health arm of National Academy of Sciences • Independent not for profit organization • Mission is to “serve as an advisor to the nation to improve health” • Provide evidence based “unbiased and authoritative advice” for private and public health care sector • Quality related tasks commissioned and sponsored by government, industry, independent foundations • Volunteer members • Peer review system

26. Agency for Healthcare Research and Quality (AHRQ) • Agency within the Department of Health and Human Services • FY 2010 budget 372 million dollars • 80% of budget supports research grants and contracts towards improving health care • Mission is to improve health care quality, improve safety and outcomes, reduce cost • Portal for consumer / clinician information • Health information technology research • Mandated role to support the US Preventative Services Task Force

27. United States Preventative Services Task Force (USPSTF) • Independent panel of primary care experts in evidence based medicine • Family practice, pediatricians, nurses, behavior specialists • Review evidence of effectiveness and develop recommendation statements • Grades A through D and I • Recommendations provided for consumption by physicians, health care systems, and health insurance • Affordable Care Act 2010 • PSA screening is now a “D” • Discourage the use of this service

28. Quality Alliances • Surgical Quality Alliance (SQA) • Alliance of surgical specialties and anesthesia • Quality measurement and improvement initiatives • Ambulatory Care Quality Alliance (AQA) • AAFP funded by America’s Health Insurance Plans • Collaborative of physician groups, health insurance plans, consumers, AHRQ • Hospital Quality Alliance (HQA) • Collaborative of public and private stakeholders • Data acquisition and reporting, measure development

29. Physician Organizations

30. Physician Organizations • American Medical Association (AMA) • “Promote the art and science of medicine” • Political advocacy organization • Steward organization for the CPT,RUC,PCPI • Membership • < 18% of US physicians currently members • 30% of members are students or residents • American College of Surgeons (ACS) • Largest surgical specialty organization • > 77,000 members (2600 fellows) • Cancer and trauma care, CME, data registry, SQA steward • Political advocacy organization

31. Urology Organizations • American Urological Association (AUA) • Founded in 1902 • FY 2010 budget 30 million dollars • Three entities with one board (2001) • AUA Education and Research 501(c)(3), AUA Inc. 501(c)(6), AUA Foundation 501(c)(3) • Eight geographical sections • American Board of Urology (ABU) • “Mission is to act on the behalf of the public to ensure high quality, safe and efficient practice of Urology”

32. Urology Organizations • American Association of Clinical Urologists (AACU) • Goal is to protect the professional autonomy of urologists • Inform members of issues and create ability to organize • Work with state societies and specialty coalitions to protect interests of urology • Large Urology Group Practice Association (LUGPA) • Association of groups with > 10 practicing urologists • Business operations, clinical outcomes benchmarking, clinical trials, educational programs • Political advocacy

33. Urology Organizations • UROPAC (Urology Political Action Committee) • Organized in 1992 and since 2003 jointly sponsored by AUA and AACU • Support key lawmakers in health policy and advocates for Urology specific issues • 2010 election cycle raised over one million dollars