The Changing Face of the Employer-Provider Relationship
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1 The Changing Face of the Employer-Provider Relationship Cleveland Clinic Market & Network Services Shannon Schwartzenburg August 21, 2013
2 Cleveland Clinic Snapshot Group practice model specialties and sub-specialties - 40,000+ employees Cleveland Clinic Health System - Expansive Main Campus - 17 Family Health Centers in Ohio - 9 Regional Hospitals - Children s Hospital for Rehabilitation Florida - Weston Clinic and Hospital - West Palm Beach Health and Wellness Center Nevada Lou Ruvo Center for Brain Health, Las Vegas Canada Toronto Health and Wellness Centre Cleveland Clinic Abu Dhabi 2
3 Challenges Facing Employers Our employer partners say they are most concerned about: The impact of rising health care costs Inconsistent health care quality and cost across nation Financial impact of outlier group Keeping employees healthy and avoiding chronic conditions 3
4 Outliers An Unbalanced Cost-to-Patient Ratio 20% 80% 5% 50% High Acuity & Catastrophic Care Cardiovascular surgery Spine surgery Orthopedics Cancer Care 80% 95% Costs Costs Population Population 4
5 Healthcare Solutions Offerings Program For Advanced Medical Care (PAMC) - COE Medical Travel Program Executive Health - Annual Comprehensive Physical Program Cleveland Clinic Healthcare Solutions My Consult - Online Medical Second Opinion Program Wellness Solutions - Programs for Wellness and Prevention National Network - Cleveland Clinic Affiliate Hospitals 5
6 Managing the Outlier Population The Right Patient Identification of target conditions and procedures The Right Diagnosis Incorrect diagnosis drives unnecessary care and cost Up to 25% of the cases we review result in a diagnosis or treatment plan modification. MyConsult an online program for obtaining a second opinion. The Right Treatment Employed staff model ensures appropriate treatment Published outcomes Focus on quality, patient experience and continuous improvement The Right Location Selection of conditions where travel is justified Quaternary referral hospital Transitional care coordination with home market providers Program for Advanced Medical Care (PAMC) 6
7 We Have the Highest Volume and Best Outcomes Open Heart Surgery Data* Cleveland Clinic compared with other U.S. News & World Report Top US Hospitals Volume 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Hosp A Hosp B Hosp C Hosp D Hosp E Hosp F CCF Mortality o/e ratio Volume Mortality Index *University HealthSystem Consortium (UHC) Comparative Database, 2011 discharges 7
8 #1 Program Leads to Higher Volume - At 100 th percentile for volumes (STS Adult Cardiac Database) - Performed 4,148 cardiac surgeries in % re-operations Volume Comparisons - Performed 2,816 valve surgeries in 2011 (most in U.S.) - 2,030 primary operations re-operations *Society of Thoracic Surgeons (STS) Adult Cardiac Database
9 National Network of Affiliated Hospitals Allows Cleveland Clinic to offer high quality, cost effective patient care across the U.S. Current Affiliates Expansion Markets Cleveland Clinic Facilities 9
10 Program for Advanced Medical Care - Overview Direct contract between large, self-funded employer and Cleveland Clinic Employers Cleveland Clinic Contracting directly with Cleveland Clinic allows you to: Offer #1 Heart Care* to Employees *Additional services available AND Realize Efficiencies and Savings Avoid Variability in Outcomes 10
11 A solution with predictability and transparency in cost Fee for service reimbursement Global case rate; evolves to episodebased rate 11
12 Three Elements Differentiate the Program Change in Benefit Design Enhanced Care Coordination Predictable Pricing Benefit available as a carve-out within current plans Qualified patients have co-pay & deductible waived All travel costs covered (including companion) Cleveland Clinic has developed targeted communication strategies to reach employees at time of need Coordination of qualification process and pre-travel tests Education for patient and caregivers on what to expect pre/post-surgery Ongoing 24/7 access to Cleveland Clinic providers after return home Transitional care coordination with home market providers Global case rates include professional and technical components DRG-based rate schedule provides for pricing transparency 12
13 Event and Episode Definition Event Based - Initial Focus Pre-Op Event Recovery and Rehabilitation 70-80% of the Cost of Care Variability in Cost & Outcomes Episode Based - Future Solution 13
14 The Value Equation Traditional Definition Value = Outcomes Cost Value = Quality + Patient Experience + Functional Status* Event + Episode + Ongoing Care Cost Reduction Cost Avoidance 5-10% per case 10-15% of cases Value Analysis: Predictive Model powered by Truven *Return to work and quality of life 14
15 Value is Driven Through Experience with the most complex patients Quality outcomes High patient satisfaction Reduced overall cost of care Improved long-term functional status and return to work 15
16
17 A Fully Coordinated Program Medical Care Cleveland Clinic: reviews medical records answers patient questions performs surgery provides/coordinates rehab transfers care to home physician Administrative Services TPA: prescreens patient coordinates eligibility performs medical reviews transfers information to home carrier processes case rate bills Note: Some examples of travel surgery procedures include: CABG, defibrillator or heart valve, hip or knee replacement, spinal or bariatric surgeries 17
18 The Problem Surgeries for Life Threatening Conditions are Expensive, Sometimes Unnecessary, and/or Low in Quality Data showed significant challenge with high cost, complicated cardiac procedures Best surgical results from most experienced surgeons As mergers reduce competition, some facilities seem to feel they own their market Considered three options to increase quality and/or reduce cost Options considered Cost Reduction Improved Quality Out-of-country surgery: Greatest Good Broad Center-of-Excellence Network: Good Single center of excellence: Neutral Greatest 18
19 The Solution Pilot with Top Quality Provider at Break Even Cost Decision was to pilot small number of procedures with a single top rated provider Lowe s selected Cleveland Clinic as designated surgery partner for high risk, complicated cardiac surgeries Ranked #1 in cardiac care Culture of quality: published outcomes Highly specialized physicians Magnet Nursing Status EMR with portable patient health record Experience with travelling patients One final goal, create a Positive disruption in marketplace 19
20 The Solution A Voluntary Program With Minimal Cost for the Beneficiary Benefit is voluntary Deductible, copay, coinsurance waived All travel cost to and from Cleveland and expenses in Cleveland paid by Lowe s for patient and companion Concierge-level patient/companion support Full administrative and travel support for employee and companion (TPA) Simplified bundled payment Case Rate paid by Lowe s Potential future expansion in procedures and providers 20
21 The Results: Good Outcomes, But Only for Small Number of People Lower mortality Industry benchmarks: 3.4% mortality Cleveland Clinic: 0% mortality since beginning of the program Re-admissions 11% re-admission rate over 3 years, due partly to: Post-discharge calls to patients MD to MD communication Quicker return to work On average, patients undergoing CABG returned to work 10 days (21%) sooner than national guidelines Satisfied employees 94% responded I feel I had much better care than I would have had if I had had surgery at my home hospital. Employee comment: My family and I know that I would not be here today if Lowe s had not created this benefit 21
22 The Results: Lessons Learned Supportive partners are key Post-op follow-up visit the day before the patient is discharged to home significantly improves recovery Physician to physician communication both before and after surgery is key Focus on hand-off/ communication with local insurer case management is important Regional centers of excellence needed for all except most complicated procedures Benefit design is powerful motivator 22
23 We Need to Reach the 100 Million Lives Outside the Scope of Healthcare Reform Source of Primary Health Benefits in the U.S. Our Opportunity Employer: Self-funded, 100 million Employer: State-regulated Medicare/ Government Source: Charles Weller, Esq., 2008 in proprietary research conducted for Cleveland Clinic 23
24 Patients Travel for Our Care More than 4.6 million patient visits annually from all 50 states and 120+ countries Medical Concierge Three hotels on campus Patients self-refer based on research Physicians refer based on our superior outcomes with complex cases. 42% 18 % 15% 25% Key Cardiac Surgery Service Areas Cuyahoga County Surrounding 6 Counties Rest of Ohio Outside of Ohio 24
25 Advantages of Mitral Valve Repair vs. Replacement Better early and late survival Improved lifestyle Better preservation of heart function and fewer post-op events Lower risk of stroke and infection, leading to fewer readmissions No need for blood thinners and accompanying blood tests Potential Savings About 25 lab tests/year at $40/test $1000 per year Cost for blood thinners $500 per year Readmissions cost as much as $50,000 per year 25
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