Payment Innovation Michael Burton, Vice President of Business Development June 1, 2017

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1 Payment Innovation Michael Burton, Vice President of Business Development June 1,

2 Solving the Challenges of inefficiency and rising costs 2

3 Patient Centered Medical Home Fee-for-service Providers work in silos Care is focused on the member s most immediate health needs Data is fragmented and not shared among providers Providers are paid for the quality of care they provide, regardless of outcomes Patient Centered Medical Home Provider and health plan work together as a team Care is proactive, focusing on immediate health needs as well as potential issues that may be developing Data is shared among providers for a big-picture view of each member s health Providers are paid for the quality of care they provide 3

4 Why Focus on Primary Care? 4

5 Patient Centered Medical Home 5

6 Helping Providers Thrive in a world of value-based care Information Risk stratification Analytics Identification of gaps in care Avoidable ER use Brand/generic drugs Tools Practice advisor (ACP) Patient Records Choosing Wisely Resources Dedicated local support Guidance on getting the most from data and tools Assistance with practice transformation 6

7 PCMH Continues to Deliver Results in Maine 0 Fewer members admitted to the hospital Lower inpatient cost 5.6% fewer inpatient admits 4.5% fewer inpatient days Providers choosing preferred sites for lab & radiology Lower costs on radiology services and 3.2% lower utilization Lower cost for lab/pathology services, and 6.0% lower utilization Declining cost and utilization of inpatient surgical services Lower inpatient surgical costs 4.5% fewer inpatient surgeries and 1.9% fewer surgical inpatient days 7

8 PCMH Delivers Superior Quality PCMH providers outperformed a control group on all quality measures and showed improvement in a majority of measures. 1.9% Well Child Visits 0-15m 4.9% 1.1% 0.8% Statin Adherence PCMH Versus Control Group Oral DM Adherence 3.4% 3.6% MMR Vaccination Diabetes: Eye Exam PCMH Improvement from Baseline 0.9% 0.7% 1.7% 0.2% 4.7% Breast Cancer Screening 0.6% Well Child Visits 0-15m Statin Adherence Oral DM Adherence MMR Vaccination Diabetes: Eye Exam Breast Cancer Screening Quality results based on matched sample control group 4/1/13-12/31/15; 8

9 The Road Ahead PCMH 9

10 Specialty Pharmacy Specialty drugs are bringing great advances in care They are also bringing great challenges Specialty drugs are used by a small number of members, but at a high cost Specialty Pharmacy is complicated to manage. And it s growing. 10

11 What s Considered a Specialty Drug? There is no standard industry definition, though specialty drugs commonly share these challenging attributes: High-cost, usually biologic Require frequent dosing adjustments, intensive clinical monitoring Special handling requirements Used to manage complicated disease states 11

12 Specialty Pharmacy Spend is on the Rise Total industry specialty drug spent is expected to reach $400B by 2020 $127B $179B $235B $400B Issues driving cost The pipeline is robust Specialty drug therapies are expensive Utilization is increasing Generic options are limited

13 Location Matters Steering members along the right path Specialty Drugs Pharmacy Benefit Medical Benefit Specialty Pharmacy Retail Pharmacy Physician s Office Ambulatory infusion center Home infusion Outpatient hospital 13

14 Provider Administered Drugs The value of managing site of care Sites of care for provider-administered drugs: Requires administration by a health care professional Doctor s office, infusion suite, home or outpatient hospital facility Outpatient hospital can be two to three times more expensive While this is true it could be the right setting for some patients 14

15 Suggestions Push the carriers to do more around Payment Innovation Look at an Rx partner to review your Pharmacy Benefit Manager Consider self funding your plan Look for a creative broker who can think outside the box 15

16 Michael Burton Vice President of Business Development Questions? 16

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