REGIONAL MAC MEETING
(November 17 & 18, 2006)

Lesli Lord, Executive Director of Coalition of Hematology Oncology Practices of the Southwest, shares her notes:

On Saturday, November 18, 2006, about 70 leaders and constituents of Region 4 attended a MAC meeting in San Antonio, TX hosted by OSCO and TSMO.

Background:

As required by Section 911 of the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA), CMS will replace its current claims payment contractors - fiscal intermediaries and carriers - with new contract entities called Medicare Administrative Contractors (MACs). CMS plans to award a total of 23 MAC contracts through three procurement cycles. Fifteen of these contracts will be with entities that will cover the majority of Part A and Part B services, i.e., A/B MACs.

The MAC Acquisition Plan cycles are:

1. Start-Up Cycle

• 4 Durable Medical Equipment (DME) MACs, and
• 1 Part A and Part B MAC

1. Cycle One

• 7 Part A and Part B MAC (Award Date: July ’07 -JR 4,5,12 and Sept. ’07- JR 1,2,7,13)

1. Cycle Two

• 7 Part A and Part B MAC (Award Date: Sept. ’08 -JR 6,8,9,10,11,14,15)

Start-Up Cycle:

On July 31, 2006, CMS announced that it had awarded the Jurisdiction 3 (J3) A/B MAC contract to Noridian Administrative Services (NAS).  As the J3 A/B MAC, NAS will immediately begin implementation activities and will assume full responsibility for the work no later than March 2007 (J3: Arizona, Montana, North Dakota, South Dakota, Utah, and Wyoming).

For more information of the DME MACs, please visit http://www.cms.hhs.gov/.

Cycle One:

In November 2005, CMS began the acquisition process for the seven A/B MAC jurisdictions that comprise Cycle One of the MAC procurement and transition schedule. CMS intends to release two RFPs for Cycle One. The first RFP will complete approximately 23% of the FFS workload under three A/B MAC jurisdictions: J4, J5 and J12. The second RFP will complete about 22% of the FFS workload under jurisdictions J1, J2, J7, and J13.

Cycle One will include the three (3) following jurisdictions:

• J4 - Colorado, Oklahoma, New Mexico, and Texas
• J5 - Iowa, Kansas, Missouri, and Nebraska
• J12 - Delaware, Maryland, New Jersey, and Pennsylvania

Cycle Two A/B MACs

The Cycle Two acquisition process will involve separate competitions for seven A/B MAC jurisdictions and four Home Health MACs.  Cycle Two of the A/B MAC acquisitions includes the following jurisdictions: J6, J8, J9, J10, J11, J14 and J15.

Source: http://www.cms.hhs.gov/

November 18, 2006 Meeting Summary

The meeting was divided into four segments:

CMS speaker to offer Washington’s view of the MAC and the official scope of work proposed for the contractor

1. Contractor Panel consisted of Medical Directors from three companies bidding on the contract/jurisdiction
2. “Larger Perspective” Panel discussed MAC and the potential implications. Panelists included a representative from Medicare’s Quality Improvement Organization (QIO); Dr. Allen from the Texas Medical Association (TMA); and a lobbyist and consultant, Marc Samuels from Hillco Partners.  
3. Action Planning Workshop.  How can each state in J4 collaborate to ensure a proactive approach to defining its position within oncology and the MACs?

Medicare Contracting Reform presented by Creighton Gales, Medicare Contractor Management Group, CMS Central Office, provided a “MAC 101” which included:

• MMA Section 911: A/B claims processing is to be integrated into a single entity to increase efficiency, accuracy and system responsiveness
• MACs will perform work currently administered by fiscal intermediaries and carriers
• Competitive award of performance-based contracts with award fees;  MACs rewarded when CMS’s operational and policy objectives are met (uh-oh)

The Medicare program benefits/goals are to improve the efficiency in program administration; reduce Medicare payment error rate; set platform for information technology improvements; and better meet future programmatic challenges and changes.

How do the providers benefit from the new operational structure?  According to Mr. Gales, the new structure will be beneficial due to the competitive process selects for strong customer service; improve provider education and training; increase payment accuracy and consistency in payment decisions; simplified interfacing for claims processing due to a single A/B MAC which will serve as point-of-contact for both A/B claims; and providers will have input in evaluations of MACs performance through satisfaction surveys.

Per CMS, the MAC jurisdictions will reasonably balance the number of fee-for-service beneficiaries and providers who are more alike in size than the existing fiscal intermediary and carrier jurisdictions.  CMS also believes the MAC jurisdictions will promote greater efficiency in Medicare’s billion + claims each year.

J4 Demographics: A/B MAC Jurisdiction 4 represents 9.1% of the Medicare’s total annual claims volume.  J4 has 3.4M beneficiaries in the FFS program cared for by 103,174 practitioners and 823 hospitals.

The MACs will serve as the single-point-of-contact for providers including claims, payment, bill submission guidance, etc.  MACs will be required to be responsive and will be measured through satisfaction surveys and other means.

MACs must have at least one Medical Director but CMS is not stipulating how many.  MACs will follow Program Integrity Manual (PIM) requirements for CACs and modifications of PIM are being considered:

• Separate Part A advisory committees similar to current Part B committees or combining Part A and Part B committees
• Utilization of telephone and videoconference meetings to broaden communication

A/B MACs will be expected to consolidate Local Coverage Determinations (LCDs) in a jurisdiction and educate providers, as necessary; and LCDs should be more streamlined with minimal variance between policies.

Link to Creighton Gales Presentation

Contractor Panel.  Panelists:

Trailblazer Health Enterprises: Charles Haley, MD and Debra Patterson, MD

Noridian Administrative Services: Robert Szczys, MD

EDS/NHIC: Bruce Quinn, MD

Each Medical Director provided a 5-10 minute introduction and overview:

Trailblazer: Noridian was the first to undergo the MAC competitive process with J3.   Each Jurisdiction will be blended into one policy.  All is speculative because rules can change between now and award period and the attendees were encouraged to listen to accept all communication with a grain of salt.  The actual processes may not mesh with message provided today.  The transition of contracts will be an enormous production; moving workloads from one contractor to another is a huge and risky endeavor.  Consolidation of LCD’s alone will be a massive undertaking.  Trailblazer is looking for simplicity and not looking for controversy in their policy. 

The MAC transition is a huge change in business for the contractors and CMS.  CMS is learning during each RFP, RFI, transition, and jurisdiction and, as a result, the bidding process and implementation will improve.  The goal is to make the change as seamless as possible for providers and beneficiaries.  CMS has insisted customer service be exemplary and transparent. Additional talking points:

• Policy: definition of least restrictive policy vs. no policy
• Consolidation of more than 800 policies to 70-80 policies. 
• Understand the challenges providers face in terms of reimbursement, etc.,

Noridian:  The focus will be to maintain consistent policies throughout the region. However, due to the regulations of combining LCD’s, Noridian sees it as an opportunity to combine in a streamlined manner.  In J3, approximately twenty LCD’s were needed for blending in J3 and he reported to significant issues or complications. They do have one policy re: hormone replacement policy that is outstanding.  

NHIC (subsidiary of EDS) currently administers Medicaid in many states and Part B in CA and New England. 

Contractor Panel Q&A

Question:

Re: Part A/B, please explain scope of business now and how the combination of Part A/B into one business unit will improve efficiencies. 

Answer(s):

Physicians are paid 20-22% of the total national healthcare dollars yet physicians drive 80%-90% of the utilization of the healthcare dollars.  As a result, Part A/B need to be as parallel as possible but Part A system is much more complicated and has a separate logic than Part B.  The two will never be merged due to the system (computer, administration, customer service) unless it is directed by Congress.  Differences also include drugs given in a hospital must follow a formulary; whereas in Part B, a formulary is not needed.

Question:

How will you manage the CACs?

Answer(s):

If it ain’t broke – don’t fix it! Re: meeting with CAC (Trailblazer in Texas), there are no plans to change it.   Trailblazer will maintain the state CAC’s and not regionalize them.  The other contractors echoed Trailblazer’s intent.

Question:

How effective are state specialty societies in advocating for their CACs and providers? 

Answer(s):

If CAC opposes the policy, then carrier tends to agree with the CACs’ recommendations.  A unified voice from specialty societies (state, regional, and city) is very important and does make a difference.

Question:

The current carrier listserv is provides an overload of policy changes and information.  Will that be curtailed?

Answer(s):

Carriers receive change request from CMS approximately every two hours and they have an obligations to pass them on to the providers.  They cannot randomly select or determine what is pertinent to each provider and therefore must share all of them.  Until Congress stops tinkering with the law, it won’t happen.  All contractors echoed the concerns (not to mention the MedLearn Matters information) but could not offer any solutions.

Question:

Do any of the contractors have subspecialty CAC meeting to discuss the upcoming combined LCD’s? 

Answer(s):

A few states have subspecialty CAC meetings but a general CAC is still necessary.  Each of the contractors was willing to participate in an informal meeting with subspecialty CAC as needed.  The general consensus was it was a good idea.   

Question:

Would organizing a four state coalition be well received by the MACs? 

Answer(s)

All: Absolutely.

“Larger Perspective” Panelists: Dale W. Bratzler, DO, MPH, QIOSC Medical Director; Bohn Allen, MD, Texas Medical Association (TMA); Marc Samuels, Hillco Partners

Dale Bratzler, DO, MPH, QIOSC Talking Points:

• Improving Quality of Care – vast majority (1/2) of budget is focused on improvement of quality of care.  QIOSC covers hospitals, nursing homes, home health agencies, physician offices, implementation of EMRs, and Medicare Part B.
• Protect the Integrity of the Medicare Trust Fund
• Beneficiary Protection –they are obligated by law to investigate all complaints
• Statutory Protection of Data – providers are protected from discovery and civil action on submitted claims- (sans beneficiary protection)
• Medicare program does random sampling for OIG validation – about 21% of sampling is reviewed by the QIOSC
• High spending does not equate to higher quality of care.  Defining quality is difficult, at best.

Bohn Allen, MD, Texas Medical Association (TMA) Talking Points:

• TMA represents 42,000 members and represent 82% of practicing physicians in Texas
• TMA was asked to attend today and offer a view of the MAC process and Reimbursement Issues
• Budget neutrality – no other industry could sustain budget neutrality yet the medical industry must
• Medicare costs have increased in spite of reimbursement decreases.
• TMA conducted a study in 2005 and determined physicians (in TX) Medicare pays about 2/3 of practice costs (not charges).  As a result, practices are forced to develop ancillary services to help sustain the basic services.
• Shifting services from Part A to Part B should have created savings for the budget but the physicians are not seeing the savings that this shift has created.
• Perhaps the new MAC arrangements (with pressure on Congress) will bring A & B under the same payment system but can’t be done unless Congress makes changes.
• According to Dr. Gailes presentation earlier, there is a push towards a more central CMS and more Medicare oversight.  The demand for more financial performances from the MACs is the code word for reducing physician reimbursements. 
• Encouraged all carriers to please keep medical associations in mind and allow them be the conduit to its members and physicians on MAC issues.  For example, TMA has quarterly meetings with Trailblazer, the current Medicare carrier.
• Carriers must act under the CMS laws and cannot act independently and therefore easier to negotiate than with commercial payers.
• Dr. Allen discussed his concern with physician future enrollment and with Medicare program untenable due to the cuts in physician reimbursement and ASP.  Congress doesn’t believe physicians will be forced out of the Medicare program (similar to participation in the state Medicaid program)

Marc Samuels, Hillco Partners Talking Points:

• Federal Level re: compendia issues: NCCN believed it would beome a part of the Medicare compendia – but it was not.  NCCN has gone to Congress and Medicare to be included. 
• Tremendous problems with orphan products and rare use products in oncology.  What is the solution when you don’t have a lot of evidence for off-label?
• CMS did not have a working oncologist on staff until approx. 2 years ago so they are a little slow to recognize unique challenges in oncology
• Areas to Watch: CAP program: Noridian is also the designated vendor for the continuation of the CAP program.
• Least restrictive LCD is a requirement – not a guideline.  FAQ (41/31) discusses the least restrictive LCD if you need to review.
• The guidance say they shall consult peer review literature; it is important to know the law and rules and use to your advantage.
• Recommended a separate peer review group for orphan products.

Action Planning Workshop.  How can each state in J4 collaborate to ensure a proactive approach to defining its position within oncology and the MACs?  Dr. John Cox moderated the brainstorming session and solicited feedback from attendees on the following:

1. Goals.  Societies within J4 have a unique opportunity to collaborate and be proactive when a new MAC is awarded.  This opportunity will allow J4 participants to cultivate a mutually respectful relationship with the new vendor; to provide a unified voice for policy and reimbursement issues; and become a vehicle for timely and relevant MAC updates to providers in J4.
2. Membership.  Membership would consist of CAC members, state oncology and medical associations and administrator community/societies of each state in J4 (TX, OK, CO, NM).   Furthermore, it was suggested that a liaison be named from J4 to communicate with ASCO and ACCC. 
3. Communication.  OSCO has created a MAC listserv.  Attendees were encouraged to subscribe to the listserv at http://oscook.org/mac_region.php.  The state societies, if able, will provide a link and information re: the MAC, and reciprocal hyperlinks among participating associations’ website.
4. Next Steps.  State societies will query the membership re: hot issues (past and present) by their carrier’s CAC prior to the contract awarding the J4 MAC and communicate the issues via the MAC listserv.  Immediately following award of J4 MAC, participants of J4 will draft a letter to the newly appointed MAC outlining the J4 participants, goals, position, and mission.  Lastly, participants of J4 will schedule a face-to-face meeting with the medical director(s) of the MAC to discuss LCDs and additional policy initiatives.

Oklahoma Society of Clinical Oncology (OSCO) - www.oscook.org

Rocky Mountain Oncology Society (RMOS) = http://www.rmos-colorado.com

New Mexico Medical Society (NMSCO) - http://www.nmsocietyoncology.org

Texas Society of Medical Oncology - http://www.tsmo-texas.com

Coalition of Hematology Oncology Practices of the Southwest (CHOP)- website coming soon.