[Senate Hearing 113-272]
[From the U.S. Government Publishing Office]
S. Hrg. 113-272
REFORMING THE DELIVERY SYSTEM: THE CENTER FOR MEDICARE AND MEDICAID
INNOVATION
=======================================================================
HEARING
before the
COMMITTEE ON FINANCE
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
FIRST SESSION
__________
MARCH 20, 2013
__________
Printed for the use of the Committee on Finance
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COMMITTEE ON FINANCE
MAX BAUCUS, Montana, Chairman
JOHN D. ROCKEFELLER IV, West ORRIN G. HATCH, Utah
Virginia CHUCK GRASSLEY, Iowa
RON WYDEN, Oregon MIKE CRAPO, Idaho
CHARLES E. SCHUMER, New York PAT ROBERTS, Kansas
DEBBIE STABENOW, Michigan MICHAEL B. ENZI, Wyoming
MARIA CANTWELL, Washington JOHN CORNYN, Texas
BILL NELSON, Florida JOHN THUNE, South Dakota
ROBERT MENENDEZ, New Jersey RICHARD BURR, North Carolina
THOMAS R. CARPER, Delaware JOHNNY ISAKSON, Georgia
BENJAMIN L. CARDIN, Maryland ROB PORTMAN, Ohio
SHERROD BROWN, Ohio PATRICK J. TOOMEY, Pennsylvania
MICHAEL F. BENNET, Colorado
ROBERT P. CASEY, Jr., Pennsylvania
Amber Cottle, Staff Director
Chris Campbell, Republican Staff Director
(ii)
C O N T E N T S
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OPENING STATEMENTS
Page
Baucus, Hon. Max, a U.S. Senator from Montana, chairman,
Committee on Finance........................................... 1
Hatch, Hon. Orrin G., a U.S. Senator from Utah................... 16
WITNESS
Gilfillan, Richard J., M.D., Director, Center for Medicare and
Medicaid Innovation, Centers for Medicare and Medicaid
Services, Baltimore, MD........................................ 3
ALPHABETICAL LISTING AND APPENDIX MATERIAL
Baucus, Hon. Max:
Opening statement............................................ 1
Prepared statement........................................... 23
Gilfillan, Richard J., M.D.:
Testimony.................................................... 3
Prepared statement........................................... 25
Responses to questions from committee members................ 38
Hatch, Hon. Orrin G.:
Opening statement............................................ 16
Prepared statement........................................... 56
Communications
Roundtable on Critical Care Policy............................... 59
Wilson, Brandon G................................................ 62
REFORMING THE DELIVERY SYSTEM:
THE CENTER FOR MEDICARE AND
MEDICAID INNOVATION
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WEDNESDAY, MARCH 20, 2013
U.S. Senate,
Committee on Finance,
Washington, DC.
The hearing was convened, pursuant to notice, at 9:35 a.m.,
in room SD-215, Dirksen Senate Office Building, Hon. Max Baucus
(chairman of the committee) presiding.
Present: Senators Carper, Casey, Hatch, Grassley, Crapo,
Roberts, Thune, and Isakson.
Also present: Democratic Staff: Mac Campbell, General
Counsel; David Schwartz, Chief Health Counsel; Tony Clapsis,
Professional Staff; and Karen Fisher, Professional Staff.
Republican Staff: Kimberly Brandt, Chief Healthcare
Investigative Counsel.
OPENING STATEMENT OF HON. MAX BAUCUS, A U.S. SENATOR FROM
MONTANA, CHAIRMAN, COMMITTEE ON FINANCE
The Chairman. The committee will come to order.
The great American inventor Thomas Edison often liked to
challenge his colleagues by saying, ``There is a way to do it
better: find it.'' Edison always looked to inspire fresh ideas
to overcome any challenge.
Today we are in need of new and innovative ideas for
America's health care system. We know there is a better way to
deliver health care and to lower costs. We created the Center
for Medicare and Medicaid Innovation to find it.
Known simply as the Innovation Center, the Affordable Care
Act established a national facility to inject government health
care programs with some of the flexibility and creativity that
the private sector enjoys.
The Center comes with a simple mission: lower costs and
improve quality. It does so by testing new payment incentives
and employing creative methods of delivering care. If the
Center develops a successful idea, Medicare and Medicaid work
to quickly replicate it nationwide. If an idea is not
successful, they go back to the drawing board and develop
something different.
In just a short time, the Innovation Center has produced
results. According to the Congressional Budget Office, the
investments in the Innovation Center are expected to generate a
13-percent return through 2019, and, in the decade after, the
Center is expected to save taxpayers tens of billions of
dollars.
The Innovation Center is already testing many promising
ideas. These include Pioneer Accountable Care Organizations,
groups of doctors across the United States who work together
and coordinate their care to reduce costs.
From Minneapolis to Maine, from Nevada to New York, these
doctors are sharing lessons learned and best practices in an
effort to provide better patient care. This is just one of the
more than 30 new programs that the Innovation Center has
already introduced, impacting the lives of 5 million
beneficiaries across all 50 States.
Health reform included specific ideas for the Innovation
Center to test. We also knew that tapping into Americans'
ingenuity and entrepreneurship could lead to ground-breaking
ideas on how to improve the health care delivery system.
So we told the Center to ask Americans for their ideas on
how to improve the quality of care without increasing costs,
and, as an incentive, the Center would provide grants to test
the most promising models. One company that answered the call
is the online clinic, Health Link Now.
Recognizing the challenges that rural communities face in
accessing mental health care, Health Link Now will partner with
local hospitals and doctors in Montana and in Wyoming. They
will provide mental health care through secure video-
conferencing and interactive technology.
Patients in even the most rural areas, like Troy, MT,
population 933, can now access quality care if needed. This
initiative is expected to lower costs through reduced hospital
admissions and emergency room visits while increasing access to
care in rural communities. If proven successful, it will likely
be replicated across rural America.
This is just one example of the type of revolutionary ideas
the Innovation Center is supporting. Some of the tested models
will be successful, others will not, but we cannot be afraid of
missteps. We must continue trying new ideas, learning from
mistakes, building on our successes. That is how we find what
works.
We also need Medicare and Medicaid to develop programs
faster than they have in the past. In 2003, Medicare partnered
to create a demonstration project in which hospitals in 26
States, including St. James Healthcare in Butte, St. Vincent
Healthcare in Billings, and Holy Rosary Healthcare in Miles
City, MT, would receive bonus payments based on the quality of
care delivered. From 2003 to 2009, the demonstration project is
estimated to have saved thousands of lives, including 8,500
heart attack patients.
Seeing the success of this demonstration project, Congress
used it as a model to create a program where Medicare rewards
all hospitals across the Nation for high-quality care. It also
penalizes hospitals that produce poor outcomes. That program
began this year.
In many ways, the 2003 demonstration project set a new
standard. It was developed in stages, with close public/private
collaboration, but it took too long. We cannot wait a decade to
develop a model and then implement it nationally. We need to
cut through red tape much more quickly.
We need to allow proven ideas to ramp up and spread rapidly
without waiting for Congress to act. That is what the vision of
the Center's task is. It can broadly deploy demonstration
projects that are proven to reduce spending or increase
quality.
This will allow us to test, evaluate, and then integrate
new ideas nationwide in only a few years instead of a decade. I
look forward to examining the progress that the Center has
made. We are here to ask questions. We want to hear about
different models tested, we want to hear which projects are the
most promising, and we want to know when we are going to see
results.
We are going to need a bold vision if we are going to get
health care costs under control, so let us act boldly. Let us
realize there is a way to do it better when it comes to health
care costs, and, as Thomas Edison said, let us find it.
[The prepared statement of Chairman Baucus appears in the
appendix.]
The Chairman. Senator Hatch is not here yet, so I will just
introduce you, Dr. Gilfillan. Why don't you proceed? As most
people know, you are the Director for the Center for Medicare
and Medicaid Innovation. Doctor, your full statement will be in
the record, and I would urge you to summarize and get to the
point in about 5 minutes. We look forward to hearing from you.
I might say, I think you are doing great work. I would just
encourage you to keep at it.
STATEMENT OF RICHARD J. GILFILLAN, M.D., DIRECTOR, CENTER FOR
MEDICARE AND MEDICAID INNOVATION, CENTERS FOR MEDICARE AND
MEDICAID SERVICES, BALTIMORE, MD
Dr. Gilfillan. Chairman Baucus, Ranking Member Hatch,
committee members, thank you for the opportunity to discuss the
Innovation Center's progress. I am a family physician by
background, and I practiced in rural Massachusetts and urban
New Jersey. Before joining CMS, I was an executive at the
Geisinger Health System in Pennsylvania. While there, I worked
with colleagues to develop new primary care and episode-based
payment models and tools for ACO development.
During that experience, I saw how innovative approaches to
delivering high-quality care at a lower cost can make a real
difference for patients and their families. Marie, a high-risk
patient in a medical home program there, had previously been
hospitalized frequently. Through that model, Marie gained
access to a case manager who helped her better manage her
medical conditions and avoid frequent trips to the ER.
Marie described the program simply by saying, ``The idea of
the program is to keep me healthy, keep me out of the hospital,
and keep costs down. I don't think I would still be here
without this program. It has been my lifeline.''
Care like this is the promise of delivery system reform and
the potential answer to the challenging problems we face in our
health care system. In all of our work at the Center, we are
focused on creating care models that improve outcomes, as this
one did for Marie, because that is the way to make care more
affordable and accessible for all Americans.
We must find new care and payment models that reward and
support providers in delivering high-quality, coordinated, and
efficient care, not simply for providing more services. Today,
I am pleased to report on our progress at the Center for
Medicare and Medicaid Innovation.
Our job is to test new models of care delivery and payment
that reduce costs and improve quality by changing the incentive
structure of our payment systems to emphasize care
coordination, improved quality outcomes, and reduced total cost
of care.
In short, to accelerate our movement to a health care
system with better outcomes and lower costs, we must accelerate
the movement of CMS, and indirectly other payers, from being
fee-for-service payers to becoming value-based purchasers of
health care through the new models we are testing.
The resources provided in the Affordable Care Act have
allowed us to build on the excellent existing CMS capabilities
to test more models on a larger scale to get more rapid
results. Right now we are working on three dozen models that
support 50,000 health care providers who are serving more than
1 million Medicare, Medicaid, and CHIP beneficiaries, as well
as many private patients. We believe these models will result
in better coordinated care, improved quality outcomes, and
reduced total costs of care.
Examples of these new service and payment models that
reward providers for delivering high-quality, coordinated care
and improved outcomes include our Comprehensive Primary Care
Initiative, a multi-payer test of care management expenses to
primary care physicians; our Pioneer Accountable Care
Organization model, a multi-payer test also testing advanced
Shared Savings incentives for larger, experienced groups of
providers; and our Bundled Payments for Care Improvement
Initiative, which is a model to test payment of a global
episode fee instead of fee-for-service payments for specific
procedures and conditions. Each of these models is directly
supporting the re-designing and the re-engineering of care to
deliver these outcomes.
From our work on these and other models, we have already
learned that providers and other stakeholders are eager to re-
design care and participate in models that reward quality and
coordination and decrease costs. States and private payers are
committed to working with us as well.
We also know that there is no one simple solution. We must
test a broad range of models. Of course we are all eager to see
the results of these models, but we need to be realistic. This
change is difficult. Some models will work, and some will not.
It will take time to see the improvements we are after.
We will see signs of change in some metrics early on, but
measures of broader impacts, such as the total cost of care,
will take longer. To get accurate information, we must give
each project sufficient time for claims to come in and quality
outcomes to emerge.
We are currently analyzing the first year of data from two
primary care projects, the Multi-Payer Advanced Primary Care
Practice and the Federally Qualified Health Center Advanced
Primary Care Practice Demonstration. We will also see first-
tier results from the Pioneer ACO model this summer. We will be
able to start sharing interim results with Congress within the
year and start giving recommendations for payment or care
changes within the next 2 years.
The good news is that providers are responding positively
to the many portions of the Affordable Care Act that support
these efforts to improve care, such as value-based purchasing.
Delivery system transformation to a more sustainable, higher-
quality system is clearly under way across the Nation, and it
is coming from grassroots providers in their communities who
understand the need, the imperative, to improve our system.
More than 250 ACOs, including the 32 ACOs in models
developed by the Innovation Center, are now operating in the
Medicare fee-for-service program, serving more than 4 million
Medicare beneficiaries. Early national data is starting to show
the effects of this focus on improving care coordination,
improved quality of care, and the total cost of care.
After more than 5 years of holding steady, the rate of all-
cause hospital readmissions is starting to trend downwards. In
addition, the rate of growth in per capita Medicare spending
has been at historic lows for 3 years in a row. We look forward
to seeing which models and demonstrations will provide the
results our health care system and the people we serve need. I
am happy to answer your questions.
The Chairman. Thank you, Doctor.
[The prepared statement of Dr. Gilfillan appears in the
appendix.]
The Chairman. The bottom line is, I think most of us--at
least I am--are concerned about making sure we are getting
value for our buck in terms of the Act, that is, that the
Center actually does produce results. You mentioned that it
takes time. That is true, it does take time.
But at the same time, people, at least in Congress, are
going to be a little bit impatient. They are going to want
results that are quantifiable, demonstrable, that you can
identify, put your finger on, and see, not just grand goals and
platitudes. So what can you tell us? You mentioned you would
have some results in a year, other results in a couple of
years.
What can you tell us here that kind of makes us more
comfortable that we are actually going to get demonstrable
results so this whole effort is worthwhile? It sounded good
when we put it together in the Act, but now we are trying to
find out whether in practice it makes sense. So give us some
numbers that make us a little more comfortable that you can
actually get the work done where these proposals will produce
results.
Dr. Gilfillan. Certainly, Chairman Baucus. We are, as I
said, now looking at some of the first-year results from some
of our early programs in primary care. It takes time for all of
these programs to--number one, programs have to start putting
new care models in place, then they need to start measuring
results. We need to see results over time so that the
information we receive and analyze is complete.
Typically, for models like this, it will take us 12 months
of experience with the new model operating, and then 3 months
after that 12-month period to get the claims in-house into the
system so we can analyze them. That is what we are doing right
now with the two models that I mentioned for primary care. We
are starting to see some signs, and I can share with you a
couple of data points.
We want to make sure though that, as we do this analysis,
it produces complete and accurate, dependable information. We
can see now, as we look at data from the State of Vermont, that
it appears that the trend, the rate of increase in cost for the
total cost of care, looks like it is below what was expected.
So it does appear that there is some early evidence of bending
the cost trend from the medical home program that we have
there.
In the State of North Carolina, we are seeing some
improvement in the rates of hospitalization, that is, the
frequency with which Medicare beneficiaries are being admitted
to the hospital and the frequency with which they are visiting
the emergency room.
These are two types of data that we are looking at very
closely in all of our models: high-level data looking at the
total cost of care and looking at quality measures and
outcomes, and then more granular, more detailed measures of the
actual experience, such as how often people go to the emergency
room of the hospital.
We are working hard. In each of our models, we have
established a rapid-cycle evaluation group, Senator, that
allows us to watch these results on a quarterly basis. As they
become complete, as we get that data to a point where we feel
it is accurate and complete, then we will share those results
with you.
The Chairman. I appreciate that. I have another question
that I am curious about. The premise behind the ACA was to move
away from volume-based services, fee-for-service, and push
toward reimbursement based more on quality.
One question is, do you think that, based upon your work,
that premise, that assumption, is still valid, and should we
still work in that direction? The second is, as you, I am sure,
know, Time magazine published an article that is getting a lot
of currency. I read it last weekend.
I am just curious of the degree to which some of these
delivery system reforms and some of your work at the Center can
get at some of the problems pointed out in that article, namely
how charges are based on this Charge Master in hospitals, and
how, at least according to the author, many people are over-
paying because the Charge Master sets rates much higher than
the actual costs of the devices, the Durable Medical Equipment,
or whatnot. So the question is the degree to which your work
will get at some of those problems mentioned in that article.
Dr. Gilfillan. Thank you for that question, Chairman
Baucus. It was quite an interesting and revealing article that
talked about many of the issues those of us who have been in
health care for a long time have been concerned about.
To your first question, we believe that the underlying
ideas in the Affordable Care Act regarding the need to
transition from fee-for-service-based payment approaches to
more value-based payment approaches is still correct, and I
think it has gained greater acceptance throughout the country.
I think what we are seeing is a real commitment from providers
to engage with CMS and with their private payers to pursue
these alternative approaches to reimbursement.
The article in Time spoke largely about the effect of
charges on either commercial payers and rates of premium that
people end up paying through private payers or, even more
unfortunately, the impact that they have on individuals who may
not have coverage.
I think we are seeing in our models, where we are working
closely with other payers, that there is a real opportunity to
change the way private payers are paying providers as well, and
some engagement from providers and being willing to engage with
them on that.
So, I would be hopeful that, with the increased coverage
that we are likely to see in 2014, the ability for more people
to access negotiated rates that are paid by commercial payers,
or the rates paid by government payers, we will see less impact
from charges and we will see the gradual move on the private
sector side from payments based on charges, such as were
referred to in the article, to payments based on value
produced, as you have stated.
The Chairman. Thank you. My time has expired.
Senator Carper. Mr. Chairman? Mr. Chairman? I need to go
chair a hearing on Sandy recovery in Homeland Security and
Governmental Affairs. Could I have just 30 seconds to say
something very briefly?
The Chairman. Absolutely.
Senator Carper. Would my colleagues indulge me?
The Chairman. I am sure they will for 30 seconds.
Senator Carper. Dr. Gilfillan, thank you so much for
assuming these responsibilities for our country. The work that
you are doing, the work at the Innovation Center, is just so
important. It is exciting, it is essential. We are going to be
debating in the next 36 to 48 hours how to get better health
care results for less money, especially with respect to
Medicare and Medicaid, and what you and other folks are working
on across the country is just critical.
Our neighbor to the north is Pennsylvania. You ran
Geisinger up there. I have been up to visit your facility and
was just really impressed with what you are doing there and
some of the lessons that we can learn, so thank you for doing
this work.
The chairman is trying to impart a sense of urgency, and
that is a sense of urgency that I think we all share. Thank
you.
Dr. Gilfillan. Thank you, Senator. I think I can say for
all of our team, it is a real honor and a privilege to be
involved in the work here at CMS and throughout the
administration and the health care system to build on the work
that was done in the Affordable Care Act.
The Chairman. Thank you.
Senator Crapo?
Senator Crapo. Thank you, Mr. Chairman.
Dr. Gilfillan, I appreciate your work and appreciate you
being here. I also appreciate hearing that CMS is taking an
innovative approach to dealing with our Medicare issues. As the
chairman referenced, we regularly are told from many different
sources that we have to get away from focusing on volume and on
to focusing on quality. The problem is, how do we do that? You
are here to give us those answers.
Physicians should be able to manage the care of their
beneficiaries in a way that rewards them for quality, which is
why I supported things like--well, various programs that
promote flexibility and quality rewards for health care
experts, like the Accountable Care Organizations.
I was also pleased to see that the dialysis community also
accessed this integrated care program with the new End-Stage
Renal Disease Care Initiative formation. I am told that, under
this model, the dialysis clinics and nephrologists can access
more expensive patients, those with multiple diseases and co-
morbidities, and the care in the Medicare program.
My question is, can you explain to me how these two models,
the Accountable Care Organization on the one hand and the new
ESRD Care Initiative, will work together and how new patients
are attributed to each?
Dr. Gilfillan. Senator, thank you for that question. Yes,
that is a great question. One of the things that we are working
on at CMS in pursuit of all these models is to build the
operational infrastructure that is needed to operate in this
new way, needed to operate in a value-based world.
This goes right to the heart of that question, and we have
built the operational capacity and ability to distinguish
patients who were aligned with one ACO or one program versus
another. It has been something we have worked hard on over the
past 2 years. There are rules that we will use to decide who
the most likely provider of care to a particular patient is
and, as were laid out actually in the Shared Savings
regulations, we look at the experience of that patient to see
who has provided the most care.
In this case, while some patients were aligned with Pioneer
ACOs or Shared Savings ACOs, the vast majority of ESRD
patients, End-Stage Renal Disease patients, were not aligned
with those ACOs. We expect that we will be able to use our
computer systems that we have built to actually identify a
distinct set of patients for the ACOs and a distinct set of
patients who will be obtaining most of their care from their
dialysis provider or their nephrologist and actually align them
appropriately with the provider of their care.
Senator Crapo. Thank you. Will the beneficiaries with ESRD
be assigned first to the new ESRD-specific program and then to
the primary care ACOs?
Dr. Gilfillan. Senator, they will not be. They will not be
assigned to two of the programs; they will only be assigned to
one. Those who are assigned already to the Pioneer or Shared
Savings ACOs will remain with those. Those who will be aligned
through our analysis with the dialysis provider will be
assigned there and will not be eligible for assignment into
ACOs.
Senator Crapo. All right. Thank you.
Thank you, Mr. Chairman.
The Chairman. Thank you, Senator.
Senator Isakson?
Senator Isakson. Thank you, Mr. Chairman.
Thank you for your work, Dr. Gilfillan. I appreciate it
very much. I have a question that actually popped into my head
while you were talking. I am one who talks about fee-for-
service all the time, and I commend the movement away from that
and the movement towards reimbursement based on quality. But it
seems to me, in the debate on the Accountable Care
Organizations and in some decisions that have been made by CMS,
there has been a total move away from home health care to drive
people more to hospitals than home health care services.
I represent a State that has a major metropolitan area,
Atlanta, but we also have a huge rural area where there is not
a physician in the county, much less a hospital. Home health
care, particularly for the elderly, but in long-term recovery,
is a better environment and a less expensive environment for a
patient to be healed in than a hospital is. Have you all done
any analysis of some of the decisions that have been made to
drive the reimbursement rates on fee-for-service for home
health care way down to move people into hospitals, which are
far more expensive?
Dr. Gilfillan. Senator Isakson, thank you for that
question. We could not agree more with you that it is always
better for a patient to obtain care in the least restrictive,
least clinical, intense setting as possible. So, whenever care
can be provided in a home, we think that is a good thing to do,
assuming it can be done safely and effectively.
We have established some models that emphasize more, we
think, home care, certainly our ACO programs, our Comprehensive
Primary Care Initiatives. All of our primary care initiatives
are very much oriented to using home care services as much as
possible, avoiding unnecessary hospital services, so there is
great incentive to do that.
We also, in our Bundled Payments for Care Improvement
Initiative, through the use of episode-based payments, have
created conditions in which hospitals, other providers working
closely with home care providers, and other post-acute
providers, can design care in a way that is most effective and
delivers the best outcomes. So we think, more and more, we will
see services provided in the home as a result of the models
that we are testing.
Senator Isakson. Well, I am glad to hear you say that,
because I have had a personal experience with one of my
children many years ago where they were recovering over an
extensive period of time, and the home health care, from the
standpoint of the mental health of the patient, is far superior
to long-term hospitalization in many recoveries.
I think there are some people--some people; I am not
speaking about you--who are driving people away from home
health care and into hospitalization, which is less good for
the patient's mental health and much more expensive in terms of
reimbursement. So, thank you for that answer.
The second question. Ten billion dollars is a lot of money.
That is your authorization over a decade. Last November, GAO
reported that several programs funded through CMMI were
potentially duplicative or overlapping with other initiatives
that CMS is currently undertaking. What specific steps are you
taking to ensure that work is coordinated and that duplication
does not take place?
Dr. Gilfillan. Thank you, Senator. The GAO report did speak
to, I think, three areas where there may have been duplication,
or they thought that it was possible. They identified the
specific activities that we had put in place to ensure that
there was coordination, and they ranged from daily interactions
with the Innovation Center team, with the Centers for Medicare
and Medicaid Services, and with the Center for Clinical Quality
Standards. So we are working throughout CMS to ensure that we
coordinate well. The other area that was identified in the GAO
report was the potential overlap with activities of the Quality
Improvement Organizations, the QIO program. We have reviewed
all of the potential overlap situations between our QIOs and
the hospital engagement networks from our Partnership for
Patients Program.
We have created plans for any hospital where both
organizations could potentially overlap so that they are
coordinating and ensuring that there is no duplication of
services or payments. So it is something we pay attention to
regularly. We meet at the highest levels of CMS to review
potential duplication and avoid that and ensure that the
programs are synergistic and complementary.
Senator Isakson. Well, that is very important. Quite
frankly, Congress is guilty of the same type thing. We have far
too many duplicative appropriations in different departments
where we could find a lot of savings if we would take time to
look, so I am glad you paid attention to that report and are
taking a look at it. Thank you for your service.
Dr. Gilfillan. Thank you, Senator.
Senator Isakson. Thank you, Mr. Chairman.
The Chairman. Thank you, Senator.
Senator Grassley, you are next.
Senator Grassley. Thank you very much.
I am sorry I did not hear your testimony. I had to be at
another place.
I have a question about the GAO's November report raising
questions about CMMI activity overlapping with the CMS offices.
Specifically, the GAO identified three key examples of overlap
between the 17 Innovation Center models and the efforts of
other CMS offices. CMS's response to this overlap was calling
the work complementary to each other. At the same time, CMMI
has a designated funding stream of $10 billion between 2010 and
2019.
So, as everyone is acutely aware, we are in the middle of
sequestration. Agencies have been told to scale back and be
smarter with the dollars. So my first question to you is, do
you think it is appropriate for CMMI to be operating models
that clearly overlap with existing programs at CMS, and was
there a good policy reason for choosing models that overlapped
so closely with existing CMS initiatives?
Dr. Gilfillan. Thank you, Senator Grassley. The GAO report
identified those three areas to include ACO activity, possible
overlaps with Medicaid activities, and possible overlap between
the Quality Improvement Organizations and the Partnership for
Patients' Hospital Engagement Networks.
As they pointed out in the report, we have established
mechanisms to ensure that there is not duplication in each of
those programs. We did improve the coordination and address the
specifics of overlap in the QIO and Partnership for Patients
programs, and completed the work that they suggested in
December.
One of the things we have learned, Senator--and we have
heard loud and clear from stakeholders around the country--is
that not one model works for everyone, that there are provider
organizations that are experienced in delivering more
coordinated care, having done it for years in Medicare
Advantage programs, and they were interested in having a more
advanced program. The Pioneer program was the result of that.
We had people from around the country come to us in the
earliest days of the Innovation Center, asking for a more
advanced, higher opportunity program for ACOs. So we developed
that program specifically for that segment of the delivery
system that was more advanced and was requesting it.
Similarly, we had heard input from other physicians in
rural communities about their concerns about being able to
participate in the Shared Savings Accountable Care Organization
program, because they were concerned they did not have
sufficient capital to make the investments.
So we established the Advanced Payment ACO program, which
supports small physician Accountable Care Organizations and
Accountable Care Organizations from rural communities. As a
result of those activities, we ended up with 40 Advanced
Payment ACOs, seven of which are actually from rural
communities and 33 that are physician-based Accountable Care
Organizations.
So, Senator, we think there is good reason for developing
programs that sound initially like they might be overlapping or
duplicative but really represent the attempt to mix or match
the richness, the diversity of the delivery system, and the
requests we have had from stakeholders to create paths to this
new care model for all different types of providers.
Senator Grassley. All right. Well, put me down for being a
little cynical about it. I think that you have answered in good
faith, so I do not question your intent. But, in 3 to 5 years,
when you might be called back here to testify during an
evaluation phase, are you comfortable that you will be able to
justify that those $10 billion were spent in truly separable
projects, because that is going to be a lot of taxpayers' money
that we are wagering?
Dr. Gilfillan. Senator, we take financial accountability
very seriously. I spent a career in the private sector, where I
learned how important it is to be accountable for, and
responsible in, the handling of financial resources.
We appreciate the resources we have. We know there is a
great deal of work to be done. We think every day about what
the ultimate return on the investments will be, and we are
confident that we will come back to you at some future time and
be able to demonstrate that to you.
Senator Grassley. All right. Thank you.
Senator Roberts, you are next. The chairman just handed me
the gavel, and I am going to give it to you, because I have to
go to the Judiciary.
Senator Roberts. That is a very dangerous proposition.
[Laughter.]
Senator Grassley. Yes. Do not abuse the privilege.
Senator Roberts. I could ask unanimous consent and then say
``without objection.'' [Laughter.]
I hate to tell you this, but you may not have a job, just
repeal and--never mind. [Laughter.]
We will go on from there. You will note that they really
did not hand me the gavel.
Thank you very much for coming and taking time out of your
schedule to come up. I do not think it comes as any surprise to
anybody on the committee, and perhaps you, that I have some
strong concerns with many of the provisions of the Affordable
Health Care Act, what some call AHA or PPACA, or whatever way
you want to describe it, most especially, those provisions that
I believe gave the Department, and more especially CMS,
authority--as I have determined in talking to many of my
providers out in the rural health care delivery system, both in
Kansas and all across the country--to ration care. Now, those
are their words, not mine, but I think they are mine as well
after listening to many of their concerns.
You stated in your testimony that Congress provided the
Secretary with the authority to expand the scope and duration
of a model being tested through rulemaking, including--and this
is very important--the option of expanding on a nationwide
basis.
I do not think I would have ever been comfortable with
this, and we did not get an opportunity at the time, although
we had many hearings in the HELP Committee and here in this
committee, but the final product, we did not have much access
to, so I could not offer an amendment.
But I have talked about this a lot on the floor of the
Senate and every chance that I get, but I do not think I would
have been very comfortable with allowing officials who are not
elected the ability to bypass the Congress to implement
policies that could impact Americans in every State, every
region of the United States. But I can tell you that I have
become even more alarmed watching the implementation.
Right off the bat, the Department and CMS began
implementing the major portions through IFRs, interim final
rules. I have a big problem with this in regards to--I remember
the days when CMS actually went out and asked people if in fact
a regulation made sense, if in fact it could be tweaked,
changed, or many different kinds of suggestions. If enough
people really complained about it during a 90-day period, 60-
day period, there would be an additional 60 days. Well, you
gave 30 days.
Basically, the stakeholders do not really have an
opportunity to weigh in. We have seen regulations, even
economically significant regulations--and that is a term that
is hard to really define--implemented with, I think, little or
no quantitative cost/benefit analysis, despite the fact that it
is required by the President's executive order.
Then--and this is the one that has really got me riled most
recently--regulations are being implemented with what we call
sub-regulatory guidances. This was a problem for me in that I
had a heck of a time trying to remember that sub-regulatory
guidance is just the name of it to begin with, but we are
talking about such things as FAQs--FAQs is Frequently Asked
Questions--and then bulletins, then postings to the website,
then guidances.
Now, aside from the fact that stakeholders can barely keep
up with all the regulations now coming out of CMS, we cannot
even guarantee that these folks know about sub-regulatory
guidances, because no one ever let them know. I am talking
about everybody within the provider system who is involved with
Medicare payments.
Then, when actually implementing the regulations through
notice and comment, the Department is giving stakeholders a
minimum amount of time, 30 days, to review hundreds of pages of
regulations, sometimes with multiple regulations being issued
in the same day.
Throw in the holidays, and you have a perfect recipe to
assure stakeholders will not be able to engage constructively,
if at all. I do not know how many hospital administrators--or
for that matter doctors, nurses, whatever--are overwhelmed with
the regulatory situation. They just do not have time to pay
attention to sub-
regulatory guidance. They do not even know it is there to begin
with.
Then you are going to have to have somebody whom they
hire--I think it is a new growth industry: regulatory overkill
101, 102, 103--but our universities and others in the private
sector just cannot really have people available to do that.
There are not that many people to help out. Do not tell me to
call a 1-800 number that does not answer or where somebody does
not have the answer.
Some representatives from the administration have come
before this committee, and I thank them for this. They have
suggested that 60 days is a more appropriate time frame in
regards to sub-regulatory guidance, again, if they even have
the ability to know what that is.
I would tell my distinguished friend and colleague and the
ranking member that I am over my time 10 seconds, but I am on a
roll, so I am going to keep going, if you do not mind.
Senator Hatch [presiding]. Keep rolling if you want to.
Senator Roberts. All right. Thank you.
I ask unanimous consent to proceed for another 5 minutes,
if I might.
Senator Hatch. Without objection.
Senator Roberts. And I know that I want to give the good
doctor an opportunity to respond.
I think this attempt to circumvent the traditional
regulatory process--again, what CMS used to do, not what they
do now because there is an agenda out there with all the
regulations--I know that there is a time frame here that the
administration wants to follow, but you cannot just leave the
entire health care delivery system behind in a fog of
regulations.
At any rate, this becomes especially alarming when coupled
with new authorities to allow CMS to expand the policies
nationwide without accountability through any congressional
review, which is what we are having today. I think there is a
big storm coming. I am concerned, because whatever chance we
have for this to really succeed, I think, is being endangered
by a storm of regulatory overkill. I call it a Katrina of
regulations; perhaps that is an overstatement.
The traditional regulatory process, as described in both
statute and executive order, calls for notice, it calls for
comment, it calls for review, and it calls for consideration of
comments, and the issuing then of a final rule.
Again, I do not think I will ever be comfortable with the
way this was done, but here is my question, finally, after this
speech, or rant, or whatever you want to call it. Can you
assure me today that any policies CMMI expands, especially
those that go nationwide, will be done through the traditional
rulemaking process, including the notice, 60-day comment
period, review and consideration of comments, clear and
quantitative cost/benefit analysis, and issuance then of a
final rule? I suppose you could say ``yes'' and that would be
the end of it, but would you please comment?
Dr. Gilfillan. Senator, as you point out, the Affordable
Care Act, section 3021, does speak to the potential for the
Secretary expanding the scope or duration of a particular model
even to a national level, assuming that we can demonstrate to
the satisfaction of the actuaries at CMS that there are cost
savings, or at least the same costs and quality getting better
and quality always being better--the same, or better. So there
is that provision, and it is stated through regulations.
We have not gotten to that point at this time. We have not
issued any regulations. I understand and hear your concerns
about regulations. We have not confronted that, but our
expectation is that we would follow the usual regulatory
pathways and all of their levels, but we have not gotten to
that point with any of our models at this point.
I would say that----
Senator Roberts. But you intend to do that, of course?
Dr. Gilfillan. We certainly are expecting to find models
that are successful that we would like to expand the duration
and the scope of, and ideally some of them nationally, as we
demonstrate the results of these different models. I would say
that we have not been involved in regulation other than in the
regulations for the Medicare Shared Savings Program for
Accountable Care Organizations. That was, I think, a remarkable
example of how we put an initial----
Senator Roberts. All right. Now, I am going to do something
I do not like to do, and I do not want to interrupt you, but
you mentioned it, and that gets to my next question. And I am
still over time. Again, I will ask for another 5 minutes if I
have to.
But the Advanced Payment ACOs, that is what you are talking
about, the Accountable Care Organizations. One question is,
what percentage of these are rural? My answer to that is, I
have heard back from many rural providers that, due to the
structural limitations of the ACOs, it is difficult, if not
impossible, for a rural community or provider to initiate an
ACO.
We just do not have the doctors, we do not have the
professionals. Many times you have to drive 60 miles, 120
miles, whatever, to see a doctor or a nurse clinician, and
maybe there is only one doctor. That doctor may circulate
around in many different hospitals. We do have regional centers
that provide very good care.
But can you speak to how many rural providers have
initiated ACOs versus any participation in an ACO initiated by
a health system for a more urban community? I think there is a
tremendous bias here to have ACOs succeed in urban settings,
but the criteria for the rural providers I think are such that
it just does not match up.
Dr. Gilfillan. Certainly, Senator, that is an excellent
question, confronting the real challenges that we know
providers in rural communities face. That is why, for our
Pioneer ACO model, we created a specific set of criteria for
rural entities to participate, and it resulted in us having a
rural ACO in Ft. Dodge, IA, at Trinity Health.
In our Advanced Payment program, we put additional funding
in place for rural providers for small physician organizations
or for hospitals in rural areas who lacked capital to become
Accountable Care Organizations. We have seven of our 40
Advanced Payment Accountable Care Organizations that are from
rural areas. One of them includes a hospital, but the others
are physician-based.
We have also worked hard across our other activities to
ensure that we get good representation and good opportunities
for rural providers, Senator. About 16 percent of our health
care innovation awards are specifically for providers, rural
providers, and are getting at some of those difficulties you
have mentioned.
Senator Roberts. All right. I am out of time, and I am
taking way too much time, and I apologize to my colleagues. I
am going to ask one more question if I might, and I apologize
to Senator Casey and to the ranking member.
You addressed efforts to reduce inappropriate hospital
admissions. Now, I do not know of anybody on the committee or
anybody anywhere who is supportive of continuing to allow for
inappropriate hospital readmissions, and I know that you have
done a lot of work for CMS, HHS, and have certainly done a lot
of work to cut down on hospital readmissions. It comes under
the heading of cost savings and even fraud and abuse
prevention.
However, can you speak to me about what work is being done
to look into the unintended consequences of these policies?
Specifically, I am referring to anecdotal examples I am being
given that make this a real problem in rural areas with
patients who need to be readmitted but are not because of this
policy.
In rural areas, there is no other place to go. I know of a
particular case of a very good friend of mine--and I am not
going to mention the hospital or the area--but whose mother was
in her 90s and had a sprained ankle. She went in to see the
doctor and went out to the parking lot and had apparently,
later, as we have determined, a stroke, but she could not get
readmitted back in the hospital except to the emergency room.
The person there who gave the treatment indicated she was
fine and went home. It was obvious that her son knew something
was terribly wrong but could not get her readmitted back into
the hospital. Now, I am not going to go into the details of
what happened later, but unfortunately she died.
Now, that is just one anecdotal example that I am
personally aware of and was involved with, and I could not
believe it. In talking to the hospital administrator, he said,
well, this is what we are operating under. Now, that is a
problem. I hope--I hope--that that is not a common theme, but I
think you have to really take a look at the rural areas and
hospital admissions. Have you done that on the other side of
it? You always wonder what lurks under the banner of reform and
what you are trying to do, and the real world out there is
something entirely different if we are not careful.
Dr. Gilfillan. Thank you, Senator. We would be happy to
work with your folks and with CMS to look into any specific
concerns you have, certainly, but we know we have to
ultimately--every hospital, every doctor makes decisions about
the right way to care for a patient, and there is nothing in
the Affordable Care Act that says that people cannot do things,
it just asks them to exercise judgment about whether the
patients need to be in the hospital or can be cared for at home
or in other settings.
So we will monitor patient satisfaction rates, patient
concerns, hospital complications. The whole intent of value-
based purchasing, of course, is to look at the combination of
quality of care outcomes, whether they be for admissions to the
hospital or readmissions to the hospital.
Senator Roberts. So you are going to take a look at the
readmission policy and look at the law of unintended
consequences and what really happens out in a rural health care
delivery system, and that that hospital administrator who tells
me that, well, it says right here under subsection C, paragraph
2, I am sorry, I cannot do this. Something is wrong here
somewhere. There is a disconnect.
Dr. Gilfillan. Senator, we would be happy to follow up on
that directly.
Senator Roberts. I do not mean to target anybody
individually. The last thing they want is for me to call them
and say, guess what, I am going to have CMS or you folks give
them a call and figure out what is wrong. They do not want to
do that. I mean, nobody wants to get into that kind of
situation.
To my distinguished ranking member and Senator Casey, I
apologize for taking so much time, but these are concerns that
are very real, and I appreciate the doctor answering to the
best of his ability. Thank you, sir.
Senator Hatch. Well, thank you, Senator.
Senator Casey, I have not made my opening statement. I will
make that and I will hold my questions, and then I will turn to
you. Is that all right?
Senator Casey. Yes.
Senator Hatch. All right.
OPENING STATEMENT OF HON. ORRIN G. HATCH,
A U.S. SENATOR FROM UTAH
Senator Hatch. I want to thank Senator Baucus for convening
this timely and much-needed hearing this morning. It is no
secret that for many reasons--and we want to welcome you, Dr.
Gilfillan, and appreciate you being here--I did not support the
President's health reform bill.
Despite my long-term interest in reforming our Nation's
health care delivery system to reduce costs and of course
improve quality, I was concerned with the creation of a new
bureaucracy known as the Center for Medicare and Medicaid
Innovation, CMMI, and giving them $10 billion in taxpayer funds
with no strings attached.
We have now held two hearings in the committee where we
have heard from the public and private sectors about
interesting ways they are working to improve the delivery of
care. I for one wholly support the private sector, working
among payers, providers, and patients, to come up with
solutions that best fit their communities in order to achieve
more efficient and higher quality results.
I have heard repeatedly from my Democratic colleagues that
CMMI is tasked with letting ``a thousand flowers bloom.'' What
I really wonder is if this is simply a euphemism for ``barely
controlled chaos.'' Dr. Gilfillan, I do not envy you your job.
The administration expects you and your staff to overhaul the
way health care is delivered in this country and to do it
quickly so that people begin to believe their claims that
Obamacare will save money.
I will make a prediction: come the first part of next year,
this is going to be utter chaos, and people are going to
realize what a tragic mess we are in because of Obamacare.
However, despite the claims that Obamacare will save money, I
am quite confident that Obamacare will only increase the costs
of health care in this country.
I believe the evidence overwhelmingly supports my position,
and we will all find out at the beginning of next year when all
of these things trigger, including 20,000 pages of regulations.
With that said, I do think there is merit to trying to
change the delivery of care and to focus on greater
coordination of care, reducing hospital admissions, and
providing better outcomes to patients. I am concerned, though,
that there is confusion and a clear lack of focus at CMMI.
The Government Accountability Office, GAO, reported in
November of last year that, while you have taken steps to
coordinate with other offices at CMS, more work needs to be
done to make coordination more systemic. It seems to me that
CMMI would function best if it would pick a few initiatives,
such as Accountable Care Organizations or Bundled Payments and
really devote the time to those initiatives to make sure they
actually work and have the intended consequences of lowering
costs and increasing quality and efficiency.
Instead, I hate to say this, but I fear that you are trying
to do too much at one time. Coordination among initiatives that
have similar goals is something the GAO has highlighted as a
concern. For example, the Innovation Center's Partnership for
Patients model and CMS's Quality Improvement Program have a
similar goal: to reduce the rate of preventable hospital-
acquired conditions and 30-day hospital readmissions. Both
models contract with organizations to disseminate interventions
to hospitals and perform virtually identical functions. That
sounds like something that could be consolidated.
I hope that CMMI takes the time to really study the impact
of initiatives, both while they are going on and at the end of
demonstrations, so we know if they work and how well they work
before the initiatives are offered to more providers and
patients.
Since the GAO report indicated that, in most cases, it
would be 3 to 5 years before CMMI and the taxpayers know if
these initiatives achieved their anticipated savings, it is
critical that they be reviewed to determine whether they meet
their stated goals. As you know, in the past, the Congressional
Budget Office has shown us that most demonstrations do not
actually save the taxpayers any money.
Finally, I wanted to raise concerns about the number of
high-
salary staff who are employed by CMMI. In addition to spending
billions on the CMMI projects, GAO noted that nearly half of
the 184-plus members of the CMMI staff are paid at the highest
levels of the Federal pay scale, which stands in stark contrast
to other areas within CMS. I have also heard that CMMI staffers
have state-of-the-art workspaces, including very expensive
treadmill desks.
In a post-sequester world where White House tours are being
canceled and Easter egg hunts are being threatened, you can
imagine why the American people would take a very cynical view
about Federal employees being furnished with $1,000 treadmill
desks.
The Federal Government absolutely cannot afford to pour
money into things that do not work. Our priority must be very
clear. We need to make government as efficient as possible, and
we do not need bloated bureaucracies, we do not need
duplication of efforts, and we do not need an increased morass
of regulations and platitudes.
We do not need taxpayer dollars being spent so that staff
can work at treadmill desks. What we do need is a clear
strategic plan to improve quality and reduce costs. We need
specific goals with specific direction to achieve those goals.
We need the right people with expertise in these areas to
develop targeted approaches that can be tried quickly, studied,
and assessed for measures of success.
Now, Dr. Gilfillan, you know that last year I sent you a
letter asking for an accounting of what your office has been
working on, how much money has been spent and, more
importantly, how that money was spent. It took you more than 6
months to reply to my request. Now, let me repeat that again: 6
months. That is, to me, entirely unacceptable. I hope I will
have your commitment today that that type of behavior will not
be repeated, and all members of this committee will be given
timely and complete responses. I would hope that you would do
that. Can I get a commitment on that?
Dr. Gilfillan. Senator, we deeply regret the length of time
it took to respond to your letter. It was the first such letter
we received. It took us time to develop what we felt was an
adequately comprehensive report addressing your questions. It
certainly is our intent to be much more----
Senator Hatch. Then call me and say, ``Look, we need a
little more time here; we will be happy to give you a step-by-
step approach in accordance with what we have worked on.'' But
do not let us sit there for 6 months without having a response.
We are getting too much of that in this administration, where
they just ignore what people up here ask them to give. It is
too pervasive in this administration, and we have to stop that
or there is going to be just unholy war up here.
Well, as you can see, I have a number of concerns that I do
not have time enough to go into right now, but I do want to
thank the chairman for convening this hearing.
[The prepared statement of Senator Hatch appears in the
appendix.]
Senator Hatch. Let me turn to Senator Casey at this point.
Senator Casey. I want to thank the ranking member. Doctor,
I appreciate you being here, for your testimony and for your
service. I know you have fond memories of Pennsylvania, and we
appreciate your work that you did in our State.
Doctor, I want to ask you one question that relates to the
work that has been done to date--with regard to the work of the
Innovation Center. I know a lot of the focus, attention, and
work has been on payment or delivery system reforms as it
relates to Medicare and Medicaid, and appropriately so. We need
to find more and better ways to deliver good care, good quality
care, and also save money.
My concern, though, is, I am not sure we are doing enough
in terms of using those same approaches or strategies as it
relates to children. I guess the basic question I would have
is, can we, or how can we, and how does CMMI plan to invest in
strategies for children that we can prove over time will result
in better outcomes, and especially with regard to children that
have the kind of complex medical needs.
You have heard the child advocates often say that, when it
comes to children's health insurance--and you know this better
than I do as a medical doctor and a practitioner--children are
not small adults, and you cannot just impose health care
strategies or approaches on them that you would on an adult.
So, can you talk a little bit about that and whether or not
there might be more opportunities to focus those same reforms
on children?
Dr. Gilfillan. Certainly, Senator. Thank you for that
question. We are working closely with our colleagues at the
Centers for Medicaid and CHIP Services on a variety of programs
intended to improve care for all Medicaid and CHIP
beneficiaries, and of course most particularly focusing on
issues that affect children.
One of those programs, of course, is the Strong Start
initiative, where we are working hard with the private sector,
the March of Dimes, the American Congress of Obstetricians and
Gynecologists, to find new ways to deliver prenatal care to
give kids the best start, to get them off on the right foot by
decreasing the incidences of prematurity. So, from a program
standpoint, that program is certainly well-focused on children
at the very beginning.
In our health care innovation awards, we have a number of
projects focused directly on the needs of children,
specifically the children with complex needs. We have, I
believe, four different models actually looking at systems of
care intended to address the needs of those patients. We have a
program in Cleveland, a program in Akron, a program in Texas,
and a program in North Carolina focused directly on that
population and investigating new systems.
Now, these are innovation awards, small programs. We are
learning a lot. We have the option as we learn to expand them,
make them broader model tests, and we have met with the
stakeholders from the Pediatric Hospital Association several
times to talk about that. We are also focused on what is
probably the most significant health problem, chronic health
problem, for children in the treatment of asthma.
We have a number of initiatives that we are working on,
again, in the health care innovation award space, to look at
new ways of treating children with asthma to decrease
exacerbations or complications and limit or decrease the
frequency that they have to go to the emergency room.
Then we are working with States through our State
Innovation Model, where we are asking them to work with us,
work with the Centers for Medicaid and CHIP Services, work with
the Innovation Center, to design programs that will improve
care for all of their populations, and these will include the
pediatric populations as well.
So it is an important area. We are committed to working
through it, to learning from the initial models, and looking
for broader opportunities, Senator, to test in a more broad-
based way new care systems for children across the country.
Senator Casey. And I appreciate that. I am glad you
mentioned Strong Start, because I was noting in your testimony
at page 7 the description, and quoting the second sentence of
that section in your testimony, ``The first is a public/private
partnership, an awareness campaign to reduce the rate of early
elective delivery prior to 39 weeks for all populations.'' You
then go on and talk about, ``It is a persistent problem.'' You
highlight the Strong Start awards, 27 of them most recently,
and two of them, by the way, in Pennsylvania. We are happy
whenever that occurs.
But what are you seeing with regard to the larger challenge
of making sure that we are learning through these programs to
deliver care better? I know it is early, but have any
conclusions as to that been yielded from Strong Start?
Dr. Gilfillan. Well, yes, Senator. The Strong Start
strategy is one we have been working on for almost a year now.
This is an initiative to work across the delivery system with
private sector colleagues, the March of Dimes, the American
Congress of OB-GYNs, and other private sector interested
parties, to help support the enactment of policies across
hospitals that are consistent with what the American Congress
of Obstetricians and Gynecologists has advocated for 20 years.
That is, that there should not be elective deliveries performed
prior to 39 weeks gestation.
Now what that means, elective deliveries mean, is there is
no medical reason for doing it, so it may be done for the
convenience of the practice, the physician. At times people
have said patients are interested, moms are interested in
having early elective deliveries.
What we have learned is that, while people think the baby
may be at-term, the reality is there is a great deal of
development that goes on between 37 and 39 weeks, so it is
important. About 8 percent of the time, babies who are
delivered at that time actually end up being admitted to the
NICU, the Neonatal Intensive Care Unit, for complications.
Senator Casey. Before 39 weeks?
Dr. Gilfillan. Before 39 weeks, even though people think it
is at-term. So the experts have long supported avoiding doing
that and not delivering babies early like that. So, through the
Partnership for Patients, we have engaged their hospital
network to talk with hospitals about putting policies in place
that prevent that from happening, and we have seen remarkable
improvement in the hospitals that are doing that.
Some hospitals had already started doing that themselves,
but many--the vast majority of hospitals around the country--
had not put a policy like that in place. Through our private/
public partnership with the March of Dimes, the American
Congress of Obstetricians and Gynecologists, hospital
associations, and through the relationships we have in our
Partnership for Patients, we have been really, I think, able to
raise the consciousness, the awareness of this problem
nationally, and we are seeing major changes across health
systems, across State hospital associations, in hospitals
putting that in place.
What happens very dramatically is, we see early elective
deliveries going from a rate that could be as high as 15, and
in some cases over 20 percent, going down to 2, 3, or 4 percent
with better outcomes, because babies are not being admitted to
the Neonatal Intensive Care Unit. We think, but we do not have
definite evidence of this, we are beginning to see a decreased
frequency in use of Neonatal Intensive Care Units as a result
of this. More to come on that as that information and data
become more complete and mature.
Senator Casey. Thanks very much. I now owe the ranking
member 3 minutes and 47 seconds.
Senator Hatch. Well, I was happy to give that to you,
especially after giving the distinguished Senator from Kansas
10 minutes. And, we were interested in your questions besides.
Senator Thune, you will be our last questioner.
Senator Thune. Thank you, Mr. Chairman.
Dr. Gilfillan, thank you for being here today. On page 31
of the November 2012 GAO report on the early implementation
efforts of the CMS Center for Innovation, GAO talked about how
a centralization database would hep the Innovation Center make
coordination of the new models more systematic.
One of the biggest goals of such a database would be to
prevent duplicative payments to providers that participate in
CMS efforts involving incentive payments for meeting quality
and cost measures. At the time, CMS officials said that such a
database would ensure that beneficiaries are not counted twice
for the purposes of calculating incentive payments and that the
database would be fully functional in September of 2012. Is
that database operational?
Dr. Gilfillan. Yes, Senator, it is operational.
Senator Thune. And can you explain what happens when the
database discovers a beneficiary is being counted twice?
Dr. Gilfillan. Certainly, Senator. That is a great
question. It goes to how we have had to build new operating
capabilities within CMS to track patients in the different
initiatives that we have, not just within the Innovation
Center, but across CMS and the Shared Savings Program as well.
So we had to build the capability for our information
systems to only align a patient once with any of these
programs, and that is exactly what the system does. We have a
series of dates where different programs present their
physicians to the IS folks. They run the data through this
database.
They look at all the visits a patient has had to a
particular provider, and, as a result of that, they align a
patient with only one set of providers so that we do not have
any duplication. So that system has been operating now since
last year. It is refined and continually upgraded, and it
becomes faster to operate, frankly, as they refine it. But it
is operating and producing the result that we were after:
namely, avoiding duplicated payments for patients.
Senator Thune. Thank you.
My understanding is that, in mid-2012, CMMI had started to
work on 17 new models designed to test different approaches to
health care delivery and payment in Medicare and Medicaid, and
it has assumed responsibility for another 20 demonstration
programs that were already in progress when the Center was
created. GAO's report, again, from November of 2012, provided
some valuable insight into how those 17 new models were
functioning. Since the GAO report, has CMMI initiated any new
models?
Dr. Gilfillan. Since the final report, we have announced
awardees for our Strong Start program, and we have announced
our upcoming comprehensive End-Stage Renal Disease program that
we are just in the solicitation phase for right now.
We also have announced awardees for our State Innovation
Model program and have identified six States that are testing
their innovation plan, and another 19 States that are testing
or have received grants, awards, to do design work. I think
those are the major additions we have had since then.
Senator Thune. What was the review process for those
models?
Dr. Gilfillan. Sure. Well, we follow the standard CMS
review processes for consideration of applications, and we
convene typically panels of reviewers to look at applications
to rate them according to the criteria that we have. Then we go
through a standard review and approval process that is
consistent with the overall grant and corporate agreement-
making policy of CMS.
Senator Thune. And is that process that you just described
any different from the process that was noted in the GAO
report?
Dr. Gilfillan. No, I do not believe it is, Senator. We
followed the standard grant-making and corporate agreement-
making processes that other Federal agencies follow. So I would
have to go back and look at the exact language, but I do not
think it is different.
Senator Thune. If it is not, if the review process has not
changed from what was noted in their report, how then can you
be sure that you do not end up repeating the same mistakes that
were noted in their report, in the GAO report?
Dr. Gilfillan. Well, Senator, we have continually improved
our approach. We are exquisitely conscious of potential
duplication in all of our models. We are working carefully to
coordinate across CMS and across the Innovation Center with
different models. I think we have been very conscious of the
importance of avoiding overlap where there is no added
advantage to starting another program.
Senator Thune. All right. My time is up, Mr. Chairman.
Thank you.
Senator Hatch. Well, thank you.
Dr. Gilfillan. Thank you, sir.
Senator Hatch. Dr. Gilfillan, we appreciate you taking the
time to be with us, and we look forward to working with you in
the future. Hopefully, we can get some of these conflicts
resolved. But thank you for being here.
With that, we will recess until further notice.
Dr. Gilfillan. Thank you very much, Senator Hatch.
[Whereupon, at 10:49 a.m., the hearing was concluded.]
A P P E N D I X
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Communications
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