MAC Timeline

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MAC Timeline
Define the Episode Set the Episode Price/Budget Incorporate Quality Measures Operationalize Payment Contract with Providers

Define the Episode

 Episode Timing:

When does the episode start, and how long does it last?

Episode Start
Live birth identified through retrospective review of claims


Health plan / Payer notification during prenatal time period

Episode Length
Episode “look-back”

  • 270 days prior to delivery (so long as the woman was pregnant in this time period)


  • First visit when pregnancy is confirmed

Episode “look-forward”

  • 60 days postpartum for mom (most common) or other time period
  • 30 days postpartum for baby (if baby is included) or other time period

Patient Population:

How do payers and providers know which patient is being cared for under an episode-based payment?

  • Include all patients
  • Establish exclusions:
  • High-risk pregnancies (which can be defined in many ways and negotiable, and identified after-the-fact for retrospective episodes).
    Women who did not receive care from delivering provider during the prenatal time period.
  • Women whose pregnancy was not confirmed until a pre-negotiated week of pregnancy (this includes women who did not seek services at the start of their pregnancy).


What services are included? Do those services cover care for the baby?

  • All services inclusive of pregnancy or a smaller subset
  • If baby is included in episode – consider whether NICU costs will be included, if they occur.



Setting the Patient Population – Thursday, May 4, 2017


Set the Episode Price/Budget

 Establishing the Price/Budget:

What data is available?

Based on historical averages of:

  • an individual physician
  • a provider group
  • ACO or IPA
  • geography or marketplace

Based on expected services using payer rates:

  • Calculated by identifying all expected services within an episode and using payer rates to build the episode.

Type of Risk:

Will the base price (budget) be adjusted for other factors?

Risk Adjustment Options

  • Will the episode be risk-adjusted (and if so, how) OR will it be a flat rate?
  • Will the payer offer a margin for providers (might be considered when provider efficiency is high)?
  • Will the payer implement an underuse fee, whereby if certain services aren’t offered they will be automatically added to the price (budget) to prevent underuse of care?
  • Will the payer offer stop-loss protection for outlier cases?

Level of Risk:

What risk model will be used with providers?

Identify the Risk Model

  • Will the payer share any savings the provider generates? If so, what percentage?
  • Will the payer expect the provider to share in any losses that are incurred? If so, what percentage?
  • Will the provider be fully responsible for all losses and able to keep all savings it generates?
  • Will the payer automatically take a percentage of the price as its built in savings?



Episode Budget and Price – Thursday, June 15, 2017

Incorporate Quality Measures

 Which measures will be utilized to measure quality?

Identify Relevant Quality Measures

  • Identify areas for improvement based on current performance
  • Engage providers and stakeholders in choosing measures
  • Consider measures already collected, reported or publicly available, including those used by other payers
  • Consider measures with state, regional or national benchmarks


How will the payer and provider determine performance?

Determine How to Reward Quality

  • Performance relative to benchmarks or targets
  • Performance relative to other providers
  • Performance relative to past performance

How will performance on measures be tied to savings or risk?

Determine How Quality will Affect the Episode Financial Model

  • Integrate quality directly into the financial model and allow for performance to adjust the savings (or loss) percentages
  • Use quality performance independently of the financial model, and reward with a separate quality bonus pool or another mechanism.



Quality Measurement Part 1- Friday, March 3, 2017

Quality Measurement Part 2 – Monday, March 20, 2017

Operationalize Payment

 How will the payer operationalize the episode-based payment?

  • Fee-for-service with retrospective reconciliation to the episode budget.
  • Prospectively paid at the start of the episode. (If this option is chosen, the trigger can’t be a live birth.)

When will reconciliation payments be made?

  • With what frequency will the payer reconcile payments?
  • Will the provider face penalties for claims not submitted in a timely manner?
  • Will the payer face penalties for late reconciliation?

How will the payer distribute payments to the contracting entity?

  • Depending on the contracting method, the payer needs to identify how payments will be distributed.
  • Will accountable providers have any requirements to distribute shared savings payments to subcontractors (if applicable?)

How will data be used to assist providers in managing to an episode budget?

  • What data should providers expect to get from payers to help them track costs relative to budget for each episode?
  • How will the data be shared, (e.g., web portal) and with what frequency (e.g., monthly, near-real-time)?

Contract with Providers

 Which providers are ready for a maternity episode-based payment?

  • Identify providers amenable and have licensure to contracting for episodes
  • Share data to engage providers
  • Conduct readiness assessments

Which providers will have contractual obligations?

  • Payer contracts with one principal accountable provider
  • Payer contracts with one provider, which in turn subcontracts with other providers
  • Payer contracts with each partnering provider

What details should be included in the maternity episode-based contract?

Create and Execute Contract

  • Episode definitions (with specificity of billing codes)
  • Terms of payment
  • Appeals process
  • Provider responsibility for reporting, frequency of claims submission
  • Payer responsibility for data sharing



Episode Budget and Price – Thursday, June 15, 2017