Transcript 101108_presentation - The American Health Lawyers Association

Employer On-Site Clinics as Medical Homes
Payors, Plans, and Managed Care Practice Group
Mid-Year Luncheon
November 8, 2010
PRESENTERS:
Richard M. Luceri, M.D.
VP of Health Care Services
JM Family Enterprises Inc.
120 Jim Moran Blvd.
Deerfield Beach, FL 33442
Telephone: (954) 363-6068
Fax: (954) 363-4258
Email: [email protected]
Elise Dunitz Brennan
Partner
Doerner Saunders Daniel & Anderson LLP
320 S. Boston Avenue, Suite 500
Tulsa, OK 74103
Telephone: (918) 591-5214
Fax: (918) 925-5214
Email: [email protected]
Overview of the Presentation

Defining medical homes and why on-site clinics are
appropriate for medical homes

Describing why corporate clinics are proliferating

Legal issues

Ways JM Family Enterprises provides chronic care
management and functions as a medical home
2
Definition of Medical Homes

Continuity of care

Clinical information systems

Delivery system design

Decision support

Patient/family engagement

Coordination of care across providers and settings

Improved access to care
3
Typical Characteristics of Medical Homes Are
Easily Provided at Employer On-Site Clinics

Open scheduling

Expanded access hours

Email communication

Patient tracking

Chronic care management

Personal health assessments and wellness initiatives

Performance reporting and improvement
4
Increased Emphasis on Medical Homes

PPACA

Medicaid Demonstration Programs

Medicare Home Demonstration from Tax Relief and Healthcare Act
of 2006 and Medicare Improvement for Patients and Provider Act
of 2008

NCQA accreditation standards in existence

The Joint Commission accreditation standards are forthcoming
5
PPACA’s Emphasis on Employer Wellness
Programs Promotes On-site Clinics as Medical Homes

Grants to small employers to provide comprehensive workplace wellness
programs for FY2011-2015.

Comprehensive workplace programs include health awareness initiatives
such as HRAs, efforts to maximize employee involvement, initiatives to
change unhealthy behaviors, and workplace policies to encourage healthy
lifestyles.

CDC to study and evaluate employer wellness programs including
comprehensive workplace chronic disease management and health
promotion programs.
6
Why Corporate Clinics are Proliferating

Healthcare costs are out of control

Healthcare delivery system is broken
7
Employers View of Costs Associated
with Reform
Employer Estimates of Healthcare Costs
Increase by less than 1%
13%
Increase by 1-2%
28%
Increase by 3-4%
Budgeted Changes 2010-2011
13%
Increase by 5% or more
12%
8.0%
8.9%
8.3%
7.0%
Don't know
N/A -- Already in
compliance
30%
3%
Source: Mercer, Health Care Reform – Sizing up the Challenge,
2010.
2010
Mean
2011
Median
Mean
Median
(2010 Sample Size=61; 2011 Sample Size=38)
Source: National Business Group on Health, Large Employers’ 2011 Health Plan Design
Changes, August 2010.
8
Even the Government Expects
Higher Costs
The rate of increase in total U.S. healthcare spending will be little
changed by the healthcare overhaul, according to federal economists
Healthcare spending as a percentage of GDP
With effects of HC
reform
Prior to HC
reform
Projected
CMS Office of the Actuary Sept. 8, 2010
Employer Reactions to Healthcare Reform
88%
74%
33%
20%
12%
Increase
Employees'
Costs
Reduce health
benefits and
programs
Absorb costs in
the business
Pass on increse
to consumers
Eliminate or
reduce
wellness/health
promotion
programs
12%
Reduce
employment
Source: Towers Watson, Health Care Reform:, 2010.
10
11%
7%
Reduce employer
Reduce
contributions to
salaries/direct
retirement plans compensations
U.S. Healthcare System is Broken


Care is fragmented and not coordinated
Over-consumption of services
Patient side: no “skin in the game” (more is better)
 Physician side: fee-for-service rewards volume not quality; physicians are
paid for what they order not for what they know; fear of lawsuits; etc.


Primary care physician shortage, projected to be even lower with ACA
No time to be the “trusted” physician
 No coordination with other providers, specialists
 Earlier referral to specialists (with regional differences based on local
expectations and sophistication)
 Lowest paid provider


IT deficiencies

low rate of electronic record adoption and sharing, exaggerated HIPAA
interpretation, little interoperability, etc.
11
Reality: Patients Do Not Receive
Recommended Care
McGlynn et al “The Quality of Health Care Delivered to Adults in the United States” NEJM June 26, 2003Health Study by the RAND Corporation
(supported by the Robert Wood Johnson Foundation and the Veterans Affairs Health Administration);
12
Employers to the Rescue:
Reasons for Success of Onsite Clinics

Better opportunities to control costs:


Shift to less expensive but patient-oriented primary care
Introduce “consumerism” in controlled setting:



Focus on generic drugs, annual physical exams, etc.
Value-based health plan design
Good health is good for business:




Physician-patient relationship is the cornerstone of care
Emphasis on screening, wellness programs, chronic disease
management
Reduced productivity losses and absence
Employee retention, work-life balance, employer of choice, etc.
13
Legal Issues

Corporate practice of medicine issues

Licensing issues

Privacy issues

ERISA applicability

Relationship to HSAs

HRAs & GINA

Liability Issues
14
Corporate Practice of Medicine
Issues

Medical home is a physician-driven model in which the physician
leads a team that takes collective responsibility for a patient.

Problem with employment of physicians in some states so there is a
need to link with a captive PC.

On-site clinics frequently rely on physician extenders (APNs and
PAs) to decrease costs.

On-site clinics need to balance reliance on physician extenders with
medical home concept that physicians are pivotal.
15
Licensing Issues Involving
Physician Extenders




PAs are frequently licensed by medical licensing statutes, so
corporate practice of medicine prohibition may apply.
APNs are typically the only type of nurses that can diagnose and
treat.
APNs may not have prescriptive authority.
Typically neither a doctor nor a physician extender can rely on the
patient assessment by an RN and make a medical diagnosis if he or
she does not see the patient directly. Further, a RN can not take
orders from a doctor unless:
 The doctor has seen the patient; and
 Has prepared a medical protocol.
16
Licensing Issues Involving Drug
Distribution

Chronic disease management includes medication management
and employers are desiring to purchase and dispense drugs directly
to employees to lower costs.

Distribution of medication through employer facilities may
necessitate wholesale or distribution pharmacy licensing issues
depending on state law.

In some states, properly registered physicians can dispense
non-schedule medicine but on-site clinics frequently warehouse
drugs.
17
Privacy Issues

Covered entity status of employer health plan, but not
employer, so free exchange of PHI between on-site clinic
and health plan must be shielded from employer.

Ease of access to patients: emails and quick and
frequent meetings when healthcare providers reside at
patient’s place of location necessitates enhanced HIPAA
and HITECH responsibilities.
18
Privacy Issues

State privacy laws, Americans with Disabilities Act, and
Family and Medical Leave Act may apply to PHI.

Employer health plan and on-site clinics are both covered
entities, and this differs from typical arrangements when TPA
is business associate of employer health plan so aggregate
collection of PHI for plan administration purposes needs to be
carefully monitored.
19
Privacy Issues

Confidentiality obligations of the on-site provider differ for
the treatment of job related injuries versus other health
care needs. Most state workers compensation laws allow
employer access to treating physician report.

May need to consider enhanced or coordinated privacy
policies for “trust.”
20
ERISA Applicability

Maintenance on the premises of an employer facility of treatment for
minor injuries or illness or rendering first aid in the case of accidents
occurring during working hours is not an employee welfare benefit
plan pursuant to DOL section 2510.3-1(c).

A wellness program is any program designed to promote health or
prevent disease. DOL section 2590.702(f).

When an on-site clinic provides chronic care coordination it
becomes a wellness program subject to ERISA plan and notification
requirements, HIPAA nondiscrimination rules, and COBRA.
21
Applicability to HSAs

IRS Notice 2008-59 (Q&A 10) allows an employer or dependent to
have an HSA and use an employee on-site clinic that is either free
or charges below fair market value, if the employee or dependent
does not receive significant benefits in the nature of medical care.

A hospital that permits its employees to receive all medical care at
its facilities for no charge is providing significant care and the
employees are not eligible for HSAs.
22
Notice 2008-59 Guidance on
Significant Benefits




Physicals and immunizations are not considered
significant benefits.
Injecting antigens provided by employees is not
considered significant benefits.
Providing aspirin and other non-prescription pain
relievers is not considered significant benefits.
Query: Does the nature of a medical home necessitate a
provision of more than significant benefits?
23
PPACA Increases Confusion

Query: Are preventive screenings broad enough to include annual
physicals, basic tests, and services typically provided in an
outpatient physician’s office to manage chronic conditions, which is
implicit in the medical home concept.

PPACA provides some indication that management of chronic
problems (such as regular blood pressure checks) fall within the
concept of preventive screenings but need further guidance.
24
PPACA Increases Confusion

Tests as to whether the services provided by on-site clinic are in the
nature of preventive and primary or treatment for injuries and
illnesses contracted at the employer’s worksite versus management
of specialist healthcare needs.

Once on-site clinics enter into employer direct service agreements
with hospitals or specialists movement to significant benefits.

For now most employees with an HSA are charged a nominal fee for
on-site clinic services, but this does not resolve the exemption from
ERISA issue.
25
Future Issue

On-Site medical clinics will be treated as a group health
plan coverage for purposes of the excise tax that goes
into effect in 2018 on “Cadillac Plans” if they offer more
than a de minimus amount of medical care to employees
in executive physical programs.


This is in the technical explanation of the revenue provisions of
the Reconciliation Act of 2010 as amended, in combination with
the Patient Protection and Affordable Care Act (JCX-18-10),
64 (March 21, 2010).
This explanation does not define de minimus medical care.
26
HRAs and GINA

Title I prohibits health plans from discriminating against covered
individuals based on genetic information.

Title II prohibits employers from discriminating against employees
based on genetic information.

Genetic Information includes family medical history and information
on individuals’ and family members’ genetic tests and genetic
services.

Federal regulations at 74 Fed Reg 51664 (October 7, 2009).
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HRAs and GINA


Fundamental to the concept of Medical Home is
collecting sufficient information through health risk
assessments and/or biometric testing, which enable the
provider to manage chronic illness or provide preventive
care.
The Medical Home concept incorporates wellness
initiatives which are governed by the HIPAA
nondiscrimination rules that prohibit discrimination in the
provision of wellness programs based on participant’s
illness or medical condition (29 CFR § 2590).
28
HRAs and GINA



Wellness programs that provide rewards for completing HRAs that
request genetic information, including family medical history, violate
the prohibition against requesting genetic information for
underwriting purposes. This is the result even if the rewards are not
based on the outcome of the assessment, which otherwise would
not violate the 2006 final HIPAA nondiscrimination rules regarding
wellness programs. Some employers give rewards for completing
HRAs that do not solicit genetic information.
Some employers make completion of HRAs completely voluntary.
Query: When a turn-key on-site clinic or independent contractor
seeks completion of HRA, is this an action of the employer?
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Professional Liability




The professional must render care with the same degree
of care as a reasonable member of that profession in
similar circumstances would render in the community.
Query: What is the community standard for on-site
clinics? Is it a different standard?
Does the standard differ for independent contractor,
employee, turn-key operation, or captive PC?
Possible apparent authority or ostensible agency issues
as raised against non-staff model HMOs.
30
JM FAMILY EXPERIENCE WITH
“MEDICAL HOME”
31
About JM Family Enterprises, Inc.

Diversified private automotive company

Founded in 1968 by automotive legend
Jim Moran

Led by President and CEO Colin Brown

Approximately 4,000 associates

Headquarters in Deerfield Beach, FL

Major business operations throughout
U.S. and Canada
32
About JM Family Enterprises, Inc.
Notable JM Family Rankings
No. 28 on “100 Best Companies to Work
For” list; ranked for 12 consecutive years
No. 30 on list of
America’s Largest Private
Companies
No. 3 on list of
“100 Best Places to Work in IT”
No. 2 on list of
Florida’s Largest Private Companies
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On-site Health & Wellness Centers
4,000 Associates
10,000 Covered Lives
Health & Wellness Centers
34
Our Leaders “Get It”
CEO
CAO/HR
Total
Rewards
Healthcare
Services
35
Overall Medical Home Strategy:
Engagement, Wellness, Prevention
Associate
Engagement
Stay Healthy
Accept responsibility for
one’s own health
Better understand how to
consume healthcare
Prevention
Promote healthy
lifestyle
Promote targeted
screening
Health Risk
Assessment
Core Programs
Coordinate Care
Weight Management
“Medical Home”
Physical Activity
Education
Coaching
Manage chronic disease
Smoking Cessation
Risk Reduction
36
On-site Health & Wellness Centers



Staff:

Primary care/IM physicians, gynecologists (full and part-time)

Full-time registered nurses

Physical therapist on-site or locally accessible in major facilities

Contracted registered dietitians and fitness instructors
Patients served:

Benefit plan members including associates, spouses, children >15

Wellness/prevention programs are open to all
Schedule options:

By appointment

“Fast Track” minor care (viewed as a “stay healthy” opportunity)

Virtual waiting rooms
37
Wellness & Prevention Programs



Smoking cessation
Weight management
Cancer screening

Breast
 Prostate
 Colorectal
 others




Vaccinations
Psychological counseling
Nutritional consultations
Onsite fitness programs tailored to location:

Gyms, swimming pool
 Exercise classes, Pilates, Boot Camp, etc.
38
Coordinated Care (DM) Programs

Core programs:




Always available:




Diabetes
Hypertension
Hyperlipidemia
Weight management
Smoking cessation
Behavioral health
Planned:

Musculo-skeletal health
39
We “Drive” Associates and Families
to Our Health & Wellness Centers

No-cost access to H&W Centers (except HAS plan)



No deductibles
All services performed on company time
“Free” ancillary lab and imaging services

Local vendor contracting
 High-touch/quality services

“Free” screening specialty visits

Well-woman exams by GYN
 Dermatology checks

“Free” starter medications, course of antibiotics
40
We Test Our Programs
Through Pilot Studies

“Modified” HRA with biometric data:

72% participation rate in pilot of > 1,000 associates without incentives
 Generated multiple annual and wellness visits, nurse coaching,
teachable moments

LifeSteps weight management program:





3-components: behavior modification, proper nutrition, and activity
Remote locations tested first
Mentoring from previous participants is maintaining engagement
Success prompted “waiting list” for future enrollees and need for
additional personnel
We pay for programs; participants maintain memberships through
continued engagement and commitment
41
We Promote Partnerships With
Local Hospitals and Provider Groups

Partnerships with area hospitals:

Employers are good corporate community partners for hospitals
 Hospital revenue streams and margins are challenged
 Grants are possible and should be pursued:




We earned a fitness and smoking cessation grant in one location
$1.5 M grant proposal is being submitted with another hospital system for
wellness partnerships
Opportunities for integrated delivery systems (ACO) and other
opportunities through PPACA
Local specialty networks



Reinforce coordinated care concept
Assure quality
Coordinated by our physicians
42
What’s Next?

Preliminary results



Future direction




We’ve begun bending the cost curve
Associate engagement has increased
Continued focus on overall health and wellness of our associates
Expand onsite or near-site services
Telehealth in certain locations
Modulate benefit design in conjunction with healthcare
services
43
Employer On-Site Clinics As Medical Homes © 2010 is published by the American Health Lawyers
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44