Legal Considerations in Negotiating ACO Contracts Broad and Cassel presented by Mike Segal at the FLAACOs 2014 Fall Conference

1. FLAACOs Business Partners
Legal Considerations in Negotiating ACO Contracts
Broad and Cassel
Mike Segal
Phone: 305.373.9400
Email: msegal@broadandcassel.com

2. FLAACOs Business Partners
Background
 The concept of "ACO's" introduced with the passage of the Affordable Care Act
 CMS launches Pioneer ACO program and MSSP
 Triple Aim: lower costs, higher quality of care for defined population
 After ACO introduced, commercial payers got into the game

3. FLAACOs Business Partners
Background
What do the new models look like?
 Leverage CMS model
 Shared savings for achieving and meeting cost and quality targets
 Move to downside risk only if confident cost and quality targets can be satisfied
 All models rely on timely, actionable data

4. FLAACOs Business Partners
Focus of Today's Discussion
 Overview of emerging contract models for population health management
 Trends in data analytics
 Legal pitfalls with fraud and abuse waivers in commercial setting
 HIPAA considerations

5. FLAACOs Business Partners
Refresher on CMS Models
MSSP and Pioneer ACO models
 Pioneer intended for more advanced ACOs
Both allow an ACO to take risk for defined population
 MSSP 2 Tracks: upside only or upside and downside
 Pioneer – 5 choices with opportunity to move to population based payments
 Fee for service remains intact (unless Pioneer with population based payment)

6. FLAACOs Business Partners
Refresher on CMS Models
Other features of programs
 Alignment – prospective vs retrospective
 Setting benchmark – look at historical claims
 Need to meet/exceed the benchmark AND meet minimum risk corridor to share
savings
 33 quality measures – taken into account as well
 Move to downside risk only if confident cost and quality targets can be satisfied

7. FLAACOs Business Partners
Commercial Contract Considerations
 Payers include insurance companies and large self-funded plans
 Since many use CMS model as starting point, make sure familiar with it
 Antitrust considerations (beyond scope of this discussion)

8. FLAACOs Business Partners
Commercial Contract Considerations
A few key points to consider during negotiations (NOT all-inclusive)
 Number of covered lives – at least 5,000
 Attribution – many use visit based (HMO can use member selection)
Visit based has pros and cons – if measured on quality need to make sure you
know who is in
Self-funded more likely to use PCP selection – ensures you capture most/all
of beneficiaries
True population encompasses everyone, not just sick
More opportunity to forge relationship with PCP and manage health
Payors attempting to forge more narrow networks

9. FLAACOs Business Partners
Commercial Contract Considerations
Network Development for ACO
 Need primary care providers – how attribution is done
 Need high quality lower cost providers
Engage providers in developing commercial contract quality measures
Ensures meaningful measures and uniformity across contracts
Incorporate as part of clinical protocols
Physician leader at negotiation table

10. FLAACOs Business Partners
Commercial Contract Considerations
Data Considerations
 Ability to extract or receive feed to monitor quality is critical
 Receipt of claims feed from payer to validate targets with your actuary is
important
 Payer must also provide daily reports (admits, discharges, etc.) to manage
population – ACO needs to include in process
Patient Engagement
 Component of quality measure
 Patient portal development
 Engage caretakers as well in plan of care

11. FLAACOs Business Partners
Commercial Contract Considerations
Validating Claims Data with your Actuary
 Evaluate current state of attributed population – 3 years of claims
 Validate medical cost target
 Advise re likelihood of success on quality measures – i.e., gateways to get $
 Consider stop loss limits, high cost exclusions and amounts?
 Have static medical cost target vs reset every year to continue savings
 First dollar shared savings?
 Cap on savings and losses?
 Upside only for x years?
 Right to audit payer calculations of results
Shared Savings Contracts are Path Forward – Not Model of Sustainability

12. FLAACOs Business Partners
Data Analytics/Population Health Management
 Sources: electronic health records, state HIE, disease registries, claims
 Data vendor to churn claims for predictive modeling?
 Mechanism to tag high risk/high cost in EHR – vendor or payer?
 Physician input a must on meaningful dashboards, data, etc.
 Low risk – forge relationships to manage for long term
 Data drives action plans (high risk, medium risk, low risk, or other stratification
model chosen)

13. FLAACOs Business Partners
Fraud and Abuse Waivers
 5 Waivers
 Do not apply in commercial context
 Waivers do not override state law
 Shared savings distributions considerations
 Patient Incentive Considerations

14. FLAACOs Business Partners
HIPAA Considerations
 Disclosures without patient consent for treatment, payment, healthcare
operations
 Healthcare operations – includes population based activities to
Improve population health
Case management
Care coordination
 Many ACO activities fall under "healthcare operations"
BUT make sure boundaries are respected
ACO compliance officer is key

15. FLAACOs Business Partners
Concluding Thoughts
 Commercial shared savings and risk contracts are multiplying rapidly across
Florida and the country
 Plans will push moving rapidly to risk
 Do not trust plan data – must get it audited
 Right mix of physicians, with a robust PCP group, essential
 The next few years will be stressful, but exciting!

16. FLAACOs Business Partners
ReachUs
Mike Segal, Partner
Broad and Cassel
Phone: 305.373.9400
Email: msegal@broadandcassel.com
Website: www.broadandcassel.com