Transcript Document

Dr. Woolsey’s Disclosure
I have no industry or other financial
relationships to disclose.
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Courtesy of:
Patient Centered Care
“…care that is respectful of and
responsive to individual patient
preferences, needs and values,
ensuring that patient values guide all
clinical decisions”
IOM. (2001). Crossing the Quality Chasm: A new health system for the
21s century. Washington, DC: National Academy Press.
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Logistics/Workbook/Action
Plan
Surviving and Thriving in the
Age of Payment and Care
Delivery Reform
Sarah Woolsey, MD
Medical Director
Patient Centered Care in Action
September 27th, 2012
Improved System Performance
Relationships
Sharing
Clinical Data
Across
Providers &
Care Settings
Consumer
Engagement
Work Flow &
Care Process
Redesign
Engaged Community
Better
Outcomes &
Health, and
Lower Costs
Using HIT for
Care
Coordination
Payment
Alignment
Transparency
& Continuous
Feedback
Support
Copyright HealthInsight
2012 update
Overview
• Payment and care delivery system reform is
upon us
• Reformed systems will put providers at financial
risk for excess:
– Avoidable complications
– Adverse outcomes resulting from care coordination
failures
– Negative health outcomes associated with patient
health behavior and care plan execution choices
• “Change is not necessary. Survival is optional”
– Deming
Medicare&Medicaid Largest Drivers
of Future Federal Spending
Projected Increases in Federal Spending, 2010-2021
$2,500
Nondefense Discretionary Spending
$2,250
Defense
$2,000
Other Mandatory
Spending
Federal Spending in Billions
$1,750
Social Security
$1,500
$1,250
$1,000
Net Interest
$750
$500
$250
$0
-$250
Medicare +
Medicaid
Offsetting Receipts
Healthcare Cost-Shifting Makes
U.S. Businesses Uncompetitive
Public and Private Health Expenditures as a
Percentage of GDP,
U.S. and Selected Countries, 2008
18%
Percentage of GDP
16%
14%
12%
8.5%
10%
8%
6%
4%
2%
1.5%
6.6%
2.8%
5.7%
1.3%
1.5%
2.5%
2.1%
7.2%
7.2%
6.5%
7.0%
1.7%
3.1%
2.4%
2.5%
7.7%
7.3%
8.1%
8.1%
2.5%
Private
Expenditure
Public
Expenditure
4.4%
8.7%
6.3%
7.4%
0%
Source: Organisation for Economic Co-operation and Development (2010), "OECD Health Data", OECD Health Statistics (database)
Notes: Data from Australia and Japan are 2007 data. Figures for Canada, Norway and Switzerland, are OECD estimates. Numbers are PPP adjusted.
Health Care Costs Have
Wiped Out Real Income Gains
Monthly Income for Typical U.S. Family of Four
$9,000
$8,000
$7,000
$ 870 for inflation
$6,000
$ 945 for health care
$5,000
$
$4,000
$1910 more income
$3,000
95 for spending
Inflation on NonHealth Care Goods
Health Care Taxes,
Premiums, Expenses
Net Available Income
$2,000
$1,000
$0
1999
2009
Source: "A Decade of Heallth Care Cost
Growth Has Wiped Out Real Income Gains
For an Average US Family," Health Affairs,
September 20011
“Every system is perfectly
designed to get the results it
gets”
Paul Batalden, M.D.
Current Payment Systems Reward
Bad Outcomes, Not Better Health
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
$
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
What the Focus Should Be:
Reduce Costs By Improving Care
Patients
REDUCING
COSTS (WITHOUT
RATIONING)
Lower
Costs
Reducing Costs Without Rationing:
Can It Be Done??
Reducing Costs Without Rationing:
Prevention and Wellness
Healthy
Consumer
Continued
Health
Health
Condition
Reducing Costs Without Rationing:
Avoiding Hospitalizations
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
Reducing Costs Without Rationing:
Efficient, Successful Treatment
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
Reducing Costs Without Rationing:
= Better Quality
Healthy
Consumer
Continued
Health
Health
Condition
Better Outcomes/Higher Quality
No
Hospitalization
Acute Care
Episode
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
How Big Are the Opportunities?
5-17% of Hospital Admissions
Are Potentially Preventable
Source:
AHRQ
HCUP
Many Procedures Could Be Done
for 80-90% Less Than Today
10-Fold Difference
5-Fold Difference
Many Other
Savings Opportunities
• Better scheduling of scarce resources (e.g., surgery
suites) to reduce both underutilization & overtime
• Coordination among multiple physicians and
departments to avoid duplication and conflicts in
scheduling
• Standardization of equipment and supplies to facilitate
bulk purchasing
• Less wastage of expensive supplies
• Reducing lengths of stay
• Moving more procedures to outpatient settings
• (Your idea here)
We Should Focus First on
How to Improve Patient Care
Contributors to Healthcare Costs
How Do We Help:
How Do We Limit:
•Patients Stay Well
• New Technologies
•Avoid Unnecessary Surgery
and Other Hospitalizations
• Higher-Cost Drugs
•Eliminate Potentially
Life-Threatening
Errors and Safety Problems
•Reduce Costs of Procedures
• Potentially Life-Saving
Treatment
“Every system is perfectly
designed to get the results it
gets”
Paul Batalden, M.D.
Are There Better Ways to
Pay for Health Care?
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
$ ?
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
“Episode Payments” to Reward
Value Within Episodes
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
$
A Single Payment
For All Care Needed
From All Providers in
the Episode,
With a Warranty For
Complications
Episode
Payment
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
Yes, a Health Care Provider
Can Offer a Warranty
SM
Geisinger Health System ProvenCare
– A single payment for an ENTIRE 90 day period including:
•
•
•
•
ALL related pre-admission care
ALL inpatient physician and hospital services
ALL related post-acute care
ALL care for any related complications or readmissions
– Types of conditions/treatments currently offered:
•
•
•
•
•
•
•
•
Cardiac Bypass Surgery
Cardiac Stents
Cataract Surgery
Total Hip Replacement
Bariatric Surgery
Perinatal Care
Low Back Pain
Treatment of Chronic Kidney Disease
Payment + Process Improvement
= Better Outcomes, Lower Costs
It Can Be Done By Physicians,
Not Just Health Systems
• In 1987, an orthopedic surgeon in Lansing, MI and the
local hospital, Ingham Medical Center, offered:
– a fixed total price for surgical services for shoulder and knee
problems
– a warranty for any subsequent services needed for a two-year
period, including repeat visits, imaging, rehospitalization and
additional surgery
• Results:
– Health insurer paid 40% less than otherwise
– Surgeon received over 80% more in payment than otherwise
– Hospital received 13% more than otherwise, despite fewer
rehospitalizations
• Method:
– Reducing unnecessary auxiliary services such as radiography
and physical therapy
– Reducing the length of stay in the hospital
– Reducing complications and readmissions.
Johnson LL, Becker RL. An alternative health-care reimbursement system—application of arthroscopy
and financial warranty: results of a two-year pilot study. Arthroscopy. 1994 Aug;10(4):462–70
Caution: The Weakness of
Episode Payment
Healthy
Consumer
Continued
Health
Health
Condition
Still paying only when
care occurs
Does not address
upstream prevention of
the episode itself
No
Hospitalization
Acute Care
Episode
Episode
Payment
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
Comprehensive Care Payments
To Avoid Episodes
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
$
A Single
Payment
For All Care
Needed For
A Condition
Comprehensive
Care
Payment
or
“Global”
Payment
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
Isn’t This Capitation?
No – It’s Different
CAPITATION
(WORST VERSIONS)
COMPREHENSIVE
CARE PAYMENT
No Additional Revenue
for Taking Sicker
Patients
Payment Levels
Adjusted Based on
Patient Conditions
Providers Lose Money
On Unusually Expensive
Cases
Limits on Total Risk
Providers Accept for
Unpredictable Events
Providers Are Paid
Regardless of the Quality
of Care
Bonuses/Penalties
Based on Quality
Measurement
Provider Makes
More Money If
Patients Stay Well
Provider Makes
More Money If Patients
Stay Well
Flexibility to Deliver
Highest-Value
Services
Flexibility to Deliver
Highest-Value Services
Example: BCBS Massachusetts
Alternative Quality Contract
• Single payment for all costs of care for a population of patients
–
–
–
–
Adjusted up/down annually based on severity of patient conditions
Initial payment set based on past expenditures, not arbitrary estimates
Provides flexibility to pay for new/different services
Bonus paid for high quality care
• Five-year contract
– Savings for payer achieved by controlling increases in costs
– Allows provider to reap returns on investment in preventive care,
infrastructure
• Broad participation
– 14 physician groups/health systems participating with over 400,000
patients, including one primary care IPA with 72 physicians
• Positive first-year results
– Higher ambulatory care quality than non-AQC practices, better patient
outcomes, lower readmission rates and ER utilization
http://www.bluecrossma.com/visitor/about-us/making-quality-health-care-affordable.html
Not Just Better Acute Care,
But Reducing the Need for It
Healthy
Consumer
Continued
Health
Health
Condition
No
Hospitalization
Acute Care
Episode
Efficient
Successful
Outcome
High-Cost
Successful
Outcome
Complications,
Infections,
Readmissions
Opportunity: Significant Reduction
in Rate of Hospitalizations
Examples:
• 40% reduction in hospital admissions, 41% reduction in
ER visits for exacerbations of COPD using in-home &
phone patient education by nurses or respiratory
therapists
J. Bourbeau, M. Julien, et al, “Reduction of Hospital Utilization in Patients with Chronic Obstructive
Pulmonary Disease: A Disease-Specific Self-Management Intervention,” Archives of Internal Medicine
163(5), 2003
• 66% reduction in hospitalizations for CHF patients using
home-based telemonitoring
M.E. Cordisco, A. Benjaminovitz, et al, “Use of Telemonitoring to Decrease the Rate of Hospitalization in
Patients With Severe Congestive Heart Failure,” American Journal of Cardiology 84(7), 1999
• 27% reduction in hospital admissions, 21% reduction in
ER visits through self-management education
M.A. Gadoury, K. Schwartzman, et al, “Self-Management Reduces Both Short- and Long-Term
Hospitalisation in COPD,” European Respiratory Journal 26(5), 2005
Global Payment Can Assist,
(But It’s a Big Jump from FFS)
FULL COMP. CARE/GLOBAL PAYMENT
Health Insurance Plan
ConditionAdjusted
Per Person
Payment
$
Physician
Practice/
ACO
Office
Visits
$
Phone
Calls
Nurse
Care Mgr
ER
Visits
Hospital
Stay
Avoidable
Avoidable
Lab Work/
Imaging
Avoidable
Flexibility and accountability
for a condition-adjusted budget
covering all services
Example: Washington State
Medical Home Pilot Program
• Organized by Puget Sound Health Alliance and
Washington State Health Care Authority
• 4-Part Payment Model
– Current FFS payments for PCP services
– Additional PMPM payment for “care management”
• $2.50 per patient per month in Year 1 (part of year)
• $2.00 per patient per month in Years 2 & 3
• No restrictions on how money is used
– Targets for Reducing Preventable ER/Hospital Utilization
• Reduction targets large enough to repay health plans for upfront
payments
• Penalty for failure: Repayment of up to 50% of PMPM payment
– Bonus for success in reducing utilization beyond targets
• 50/50 split of payers’ savings from reductions in ER visits and/or
hospitalizations net of PMPM payment
• Quality of care must be maintained based on quality measures
• Implementation Began May 2011
– 7 health plans (5 commercial, 2 Medicaid)
– 12 primary care practice sites (8 provider orgs), ~ 25,000 patients
CMS CMMI: The Federal $10 Billion
Investment in Payment & System Redesign
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Medicare Shared Savings Model ACO Initiative
Medicare Advanced Payment Model ACO Initiative
Medicare Pioneer ACO Initiative
Bundled Payments for Care Improvement Initiative
Comprehensive Primary Care Initiative
FQHC Primary Practice Demonstration
Independence at Home Demonstration
Initiative to Reduce Avoidable Hospitalizations Among Nursing
Facility Residents
Medicaid Emergency Psychiatric Demonstration
Medicaid Incentives for the Prevention of Chronic Disease
State Demonstrations to Integrate Care for Dual Eligibles
Community-based Care Transitions Program
Partnership for Patients
Innovation Advisors Program
Innovation Awards Program
http://www.bluecrossma.com/visitor/about-us/making-quality-health-care-affordable.html
A Sampling of Utah Payment Reform
Initiatives: Both Public and Private Sector
• Approved Medicaid ACO Waiver Application
• Multiple PCMH Initiatives with Private Payers and
Providers
• Direct contracting with Providers by Private and Public
Employers
• Payer, State, and Community-led efforts to measure
and make visible pricing and quality performance
• Onsite Work Clinics Developed by providers
• Medical Home Infrastructure Development in
Preparation for ACO
• Other ACO Development Activities by Providers and
Payers (e.g., Central Utah Clinic)
• “Limited Network” Product Development by multiple
payers
• Aarches CO-OP insurance plan ($85M CMS loan)
http://www.bluecrossma.com/visitor/about-us/making-quality-health-care-affordable.html
Things Needed to Make Global
Payment Work Well for Physicians
• Trusted, Shared Data on Current Utilization, Cost
– Physician needs to know current rates of admissions,
complications, etc. to set prices appropriately
– Purchaser/payer needs to know that they’re getting a better deal
than they are today
• Protections for Physicians from Insurance Risk
–
–
–
–
Severity adjustment of payment
Risk corridors in case costs were mis-estimated
Outlier payments for unusually expensive patients
Risk exclusions for some patient populations
• Good Measures of Outcomes
– Measures meaningful to patients using high-quality data
Challenge: Gaining Support from
a Critical Mass of Payers
Payer
Better
Payment
System
Payer
Current
Payment
System
Payer
Current
Payment
System
Provider
Patient Patient Patient
Provider is only compensated for changed practices
for the subset of patients covered by participating payers
Payers Need to Truly Align to
Allow Focus on Better Care
Payer
Better
Payment
System A
Payer
Better
Payment
System B
Payer
Better
Payment
System C
Provider
Patient Patient Patient
Even if every payer’s system is better than it was,
if they’re all different, providers will spend too much time
and money on administration rather than care improvement
Payer Coordination Is Beginning
to Occur Around the Country
• Examples of Multi-Payer Payment Reforms:
– Colorado, Maine, Michigan, Minnesota, New York, North Carolina,
Oregon, Pennsylvania, Rhode Island ,Vermont, and Washington
all have multi-payer medical home initiatives
• A Facilitator of Coordination is Needed
– State Government (provides anti-trust exemption)
– Non-profit Regional Health Improvement Collaboratives
• Medicare Needs to Participate in Local Projects as Well as
Define its Own Demonstrations
– Center for Medicare and Medicaid Innovation (CMMI) created
under PPACA provides the opportunity for this
– Medicare is now participating in eight of the state-led multi-payer
medical home initiatives
Payment Reform Efforts Depend
on Patient, Family & Consumer
Engagement
In the Clinic  Outside the
Clinic
• A ratio problem: 60 vs. 525,540 minutes
• How can individuals take control of their
own healthcare, and ultimately their
own health?
• What can providers and plans do to
help?
Benefit Design Changes Are
Critical to Success
Ability and
Incentives to:
• Improve health
• Take prescribed
medications
• Allow a provider to
coordinate care
• Choose the
highest-value
providers and
services
Benefit
Design
Payment
System
Patient
Provider
Ability and
Incentives to:
• Keep patients well
• Avoid unneeded
services
• Deliver services
efficiently
• Coordinate
services with other
providers
Current Lack of Incentives for
Value-Based Patient Choice
• Copays, Co-insurance, and High Deductibles
can discourage patients from getting
preventive treatments or medications they
need to stay well and out of the hospital
• Copays, Co-insurance, and High Deductibles
do little to encourage patients to be costconscious in choosing among high-cost
providers and services
Pay the Difference in Price?
Use the High-Value Provider
Knee Joint
Replacement
Consumer Share
of Surgery Cost
$1,000 Copayment:
10% Coinsurance
w/$2,000 OOP Max:
$5,000 Deductible:
Highest-Value
(Reference Pricing):
Price #1
$23,000
Price #2
$28,000
$1,000
$2,000
$1,000
$2,000
$5,000
$5,000
$0
$5,000

Price #3
$33,000


$5,000 
$1,000
$2,000
$10,000
Blue Cross/Blue Shield of MA
Hospital Choice Cost-Share
Low-Cost
Hospitals
High-Cost
Hospitals
PCP
$20
$20
SPC
Inpatient Hospital
$35
$500
$35
$1500*
Outpatient Hospital Day Surgery
High Tech Radiology
$250
$50
$1250
$500
Laboratory
X-Rays/Other Imaging Tests
$0
$0
$35
$100
PT/OT/ST
$35
$70
Benefit
*LOWER INPATIENT COPAY APPLIES IF EMERGENCY ADMISSION
Use Financial Incentives to
Encourage Use of Medical Home?
ROCK
MIDDLE GROUND
HARD PLACE
CONSUMERS/
PATIENTS CAN
CHANGE OR USE
MULTIPLE
PROVIDERS
AT WILL
CONSUMERS/
PATIENTS ARE
ENCOURAGED
TO CHOOSE &
USE AN ACO OR
MEDICAL HOME
CONSUMERS/
PATIENTS ARE
“LOCKED IN”
TO A SINGLE
GATEKEEPER
PROVIDER
OPTION 1:
Charge patients more for using providers
outside the ACO or medical home (requires
changing benefits)
Or Offer a “Better Product” to
Attract and Retain Patients?
ROCK
MIDDLE GROUND
HARD PLACE
CONSUMERS/
PATIENTS CAN
CHANGE OR USE
MULTIPLE
PROVIDERS
AT WILL
CONSUMERS/
PATIENTS ARE
ENCOURAGED
TO CHOOSE &
USE AN ACO OR
MEDICAL HOME
CONSUMERS/
PATIENTS ARE
“LOCKED IN”
TO A SINGLE
GATEKEEPER
PROVIDER
OPTION 1:
Charge patients more for using providers
outside the ACO or medical home (requires
changing benefits)
OPTION 2:
Give patients high quality, coordinated care
by using the providers inside the ACO or
medical home (requires payment change)
Today: Many Barriers to Patient
Adherence & Care Coordination
Services Unavailable
or Not Affordable
PATIENT
Lack of
Transportation
NON-MEDICAL
SUPPORT
(e.g., weight loss)
PCP OFFICE/
MEDICAL HOME
SPECIALIST
OFFICE
Multiple Days
Off Work
LAB FOR
TESTING
Flexible Payment Allows
More Radical Care Redesign
Single, Flexible,
Comprehensive Care Payment
PCP OFFICE
WORK-SITE
CLINIC
PATIENT
SNF/ASSISTED
LIVING CLINIC
LAB FOR
TESTING
NON-MEDICAL
SUPPORT
SPECIALIST
SUPPORT
URGENT
CARE CENTER
EMERGENCY
ROOM
Where are we going?
• Care delivery system will need to
accommodate more patients and sicker
patients
• New models of care and innovation needed
to address cost/capacity/quality issues.
• Patient at the center and a new focus on care
outside clinic walls.
• Payment models will change; more
accountability for outcomes, less focus on
activities.
“Every system is perfectly
designed to get the results it
gets”
Paul Batalden, M.D.
Rapid Cycle - Multiple Cycles
Overall AIM Increase documented eye exams
for our diabetes population by 45% in the next 12 months
Implement Final
Changes
Cycle #5 – Reminder letter from PCPs
Expect Challenges
and Barriers
Cycle #4 – Computer Network with eye doctors
Cycle #3 – Front Office track down eye results
Cycle #2 – Patient Fax Back Form
Cycle #1 – Contact Eye Doctors
Time
Summary
• Payment and care delivery system reform is
upon us
• Reformed systems will put providers at financial
risk for excess:
– Avoidable complications
– Adverse outcomes resulting from care coordination
failures
– Negative health outcomes associated with patient
health behavior and care plan execution choices
• “Change is not necessary. Survival is optional”
– Deming
Today’s Engagement Agenda
• Can patient choices and behavior be positively
influenced by health care providers? Or …
– are such patient behaviors beyond the reach of
providers (there’s nothing we can do)?
– can patient behaviors be influenced by providers, but
not systematically (instead “luck” dominates)?
– can patient behaviors be influenced by providers, but
those providers must be born with the knack (it
cannot be learned)?
– is there something else that makes this impossible?
• What can we do to prepare for reform?
Self-assessment:
• Are you ready?
• Areas for improvement?
• Experts and best practices.