Legacy Health Issues Public Comment on Centers for Medicare & Medicaid Services Proposed Rule

WASHINGTON, June 30 -- Anna Loomis, senior vice president and chief financial officer of Legacy Health, Portland, Oregon, has issued a public comment on the Centers for Medicare and Medicaid Services' proposed rule entitled "Comprehensive Care for Joint Replacement Model Three Year Extension and Modifications to Episode Definition and Pricing". The comment was written on June 22, 2020, and posted on June 24, 2020:

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On behalf of Legacy Health, we appreciate the opportunity to comment on the February 24th CMS proposed rule titled, "Medicare Program: Comprehensive Care for Joint Replacement Model Three-Year Extension and Changes to Episode Definition and Pricing" (CMS-5529-P).

Legacy Health is a nonprofit health care provider in the Portland-Vancouver area and mid-Willamette Valley with an integrated network of care providers from over 100 primary care, urgent care and specialty care clinics, and seven community-based and nationally recognized hospitals - Legacy Emanuel Medical Center, Randall Children's Hospital at Legacy Emanuel, Legacy Good Samaritan Medical Center, Legacy Meridian Park Medical Center, Legacy Mount Hood Medical Center, Legacy Salmon Creek Medical Center, and Legacy Silverton Medical Center.

Legacy, in the Portland-Vancouver-Hillsboro MSA, is one of 86 CJR participating providers that was defined as a voluntary participant in the CJR demonstration in 2018 when CMS reduced the number of mandatory MSAs from 67 to 34 (i.e., the Portland-Vancouver-Hillsboro MSA was redefined as a "voluntary" MSA). During the first three years of the demonstration (2016, 2017 and 2018) Legacy reduced Medicare spending by 2.91%, 8.34% and 5.62%.

In the proposed rule CMS states, "we are not proposing to provide any additional opt-in period for . . . any hospitals with CCN primary address located in the 33 voluntary MSAs and therefore, participation of these hospitals in the model will end at the end of performance year 5," or this year.

Though plainly stated, the agency's rationale for discontinuing participation by providers in "voluntary" MSAs appears specious.

By narrowing participation in a proposed three-year CJR extension to providers in the remaining mandatory 34 MSAs, CMS states, "narrowing participation for hospitals in the 34 mandatory MSAs during the proposed 3-year extension will allow CMS to minimize selection bias while evaluating the impact of the changes proposed in this rule." Legacy's MSA was, like the other 33 now "voluntary" MSAs, for the first two years of the CJR demonstration "mandatory" MSAs. CMS cannot now claim the agency wishes to "minimize selection bias" by simply renaming "mandatory" participants "voluntary" participants. That they "volunteered" to remain in the demo after PY2 is irrelevant particularly since they would have received only one year of performance data by January 2018 and since a significant percent of those redefined as "voluntary," over 25%, chose to persist in the demo. Logic suggests CMS allowed the 86 to remain in the demo because the agency would know their PY4 and PY5 performance would be no less evaluatively meaningful than providers still defined as "mandatory." Nor will their performance be any less evaluatively meaningful should they be allowed to participate for an additional three years particularly if CMS wants to understand better financial APM performance over time.

CMS also argues, "We already have evaluation data on voluntary LEJR bundled payment model participation from the Bundled Payments for Care Improvement (BPCI) model which ended on September 30, 2018." CMS states further the agency is gathering data on LEJR bundles from the currently running BPCI Advanced that began this past January. This reasoning is also faulty. Both BPCI and BPCI Advanced are voluntary bundled payment demonstrations. Both suffer from selection bias.

As an alternative to CJR, CMS states, "We believe that BPCI Advanced is an ideal fit for hospitals seeking to voluntarily participate in a clinical episode-based payment model for LEJR ... Since the CJR model, under our existing regulations, would end on December 31, 2020, we anticipate that any participant hospitals interested in pursuing voluntary participation in a bundled payment model would have applied to participate in BPCI Advanced." Legacy is a participant in BPCI Advanced, but not for LEJR episodes. Legacy did in fact analyze the potential financial effect of participating in BPCIA Advanced LEJR and found it to be far from an "ideal fit." The LEJR BPCI targets for Legacy are essentially unattainable. Had the participating Legacy facilities been subject to the BPCI LEJR targets during CJR PY3, Legacy would have missed the targets by $1.3 million. Even if 100% of all skilled nursing stays, home health visits, and readmissions had been eliminated on non-fracture cases, the Legacy hospitals still would have owed money to CMS. LEJR participation under BPCI Advanced is not a viable alternative.

In light of these arguments, particularly in light of the fact there is, again, a critical need to evaluate APM financial performance over time and because ten years after passage of the ACA only a small percent of Medicare Fee for Service providers participate in an Advanced APM, we strongly encourage CMS to allow those re-defined as "voluntary" providers to continue to participate in the CJR demo should it be extended three years.

Thank you for consideration of our comments.

Sincerely,

Anna Loomis

Senior Vice President & Chief Financial Officer

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The proposed rule can be viewed at: https://www.regulations.gov/document?D=CMS-2020-0013-0002

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