CLINICAL INTEGRATION DRIVERS, IMPACT, AND OPTIONS JOBY KOLSUN, D.O. MEDICAL DIRECTOR CLINICAL INTEGRATION LEE PHO

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1 CLINICAL INTEGRATION DRIVERS, IMPACT, AND OPTIONS JOBY KOLSUN, D.O. MEDICAL DIRECTOR CLINICAL INTEGRATION LEE PHO

2 Disclaimers My current position I am not offering advice on clinical integration

3 Items to be Covered What is clinical integration? What are the driving forces? What is the impact on you? What are your options?

4 Clinical Integration The American Medical Association (AMA) describes clinical integration as the means to facilitate the coordination of patient care across conditions, providers, settings, and time in order to achieve care that is safe, timely, effective, efficient, equitable, and patient-focused.

5 Clinical Integration Integration of clinical information and healthcare delivery services from distinct entities. Refers to the coordination of care across a continuum of services, including preventive, outpatient, inpatient acute hospital care, post-acute including skilled nursing, rehabilitation, home health services, and palliative care to improve the value of the care provided. Maintains a focus on quality, value, and population health management. The Camden Group

6 Solo Practice Affiliated Integrated

7 FTC/DOJ Clinical Integration In their Statements of Antitrust Enforcement Policy in Health Care, the Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice declared that joint negotiation of fees for services by competing healthcare providers could be justified either through (1) the sharing of significant financial risks among the providers or (2) the providers clinical integration. Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice Statements of Antitrust Enforcement Policy in Health Care, February 13, 2013

8 FTC/DOJ Clinical Integration Physician network joint ventures that do not involve the sharing of substantial financial risk may also involve sufficient integration to demonstrate that the venture is likely to produce significant efficiencies. Such integration can be evidenced by the network implementing an active and ongoing program to evaluate and modify practice patterns by the network s physician participants and create a high degree of interdependence and cooperation among the physicians to control costs and ensure quality. Federal Trade Commission Department of Jus7ce

9 FTC/DOJ Clinical Integration This program may include: (1) establishing mechanisms to monitor and control utilization of health care services that are designed to control costs and assure quality of care (2) selectively choosing network physicians who are likely to further these efficiency objectives (3) the significant investment of capital, both monetary and human, in the necessary infrastructure and capability to realize the claimed efficiencies Federal Trade Commission Department of Jus7ce

10 Drivers

11 OECD 2014 Health expenditure as a share of GDP, 2011 (or nearest year)

12 OECD 2014 Health expenditure as a share of GDP

13 Per Capita Spending Life Expectancy SOURCE ORGANISATION FOR ECONOMIC COOPERATION AND DEVELOPMENT AND THE CIA WORLD FACTBOOK *PURCHASING POWER PARITY 2007 OR MOST RECENT YEAR FOR WHICH DATA ARE AVAILABLE

14 Key facts for the United States from OECD Health Statistics 2014

15 Key facts for the United States from OECD Health Statistics 2014

16 Overweight an obesity among children Source: OECD Health Statistics 2013, OECD (

17 Healthcare Costs by Age U.S. is spending much more for older ages Source: Fischbeck, Paul. US-Europe Comparisons of Health Risk for Specific Gender- Age Groups. Carnegie Mellon University; September, 2009.

18 The Healthcare Advisory Board

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20 Waste in Healthcare Delivery in the US % 19% 14% Failure of care delivery 4% Failure of care coordination 14% 21% Overtreatment Administrative complexity Pricing failures Fraud and Abuse 27%

21 Source: OECD Health Statistics 2013, OECD (

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23 A Study of Cost Variation for Percutaneous Coronary Interventions (Angioplasties) in the U.S. July 16, 2015 Blue Cross Blue Shield Association

24 Problems paying health bills Family of 4 Median Income $65,000 Typical Family of 4 $24,691 Employer pays $14,198 Employee pays $10,493 Commonwealth Fund Biennial Health Insurance Survey, 2014

25 Medicare Trust Fund Predictions 1983 Medicare trust fund was in a precarious position, facing insolvency around The Medicare Hospital Insurance trust fund is expected to remain solvent until the year 2023, according a report issued by the fund s trustees 2015 The Medicare Trustees today projected that the trust fund that finances Medicare s hospital insurance coverage will remain solvent until 2030, four years beyond what was projected in last year s report.

26 CMS Medicare Quality or Value Payments 60% 50% 40% Began Oct 1, % 20% 10% 0%

27 HealthCare Transformation Task Force 75% of their business into valuebased payment arrangements by 2020.

28 H.R.2 - Medicare Access and CHIP Reauthorization Act of 2015 ***SGR is dead*** FY 2015 through FY % increase FY 2019 (Oct 1, 2018) begin MIPS. FY /- 4%, 5%, 7%, 9%. (budget neutral winners & losers)

29 Adjustments to Medicare Payments to Physicians under the Merit-Based Incentive Payment System (MIPS). Rosenthal MB. N Engl J Med 2015;373:

30 Merit-based Incentive Payment System Payment is based on 4 areas: Quality Resource Use Meaningful Use Clinical Practice Improvement. If you receive significant payment in an Alternative Payment Model (ACO, MSSP, Bundle, etc.) you are excluded from MIPS.

31 Triple Aim Don Berwick & IHI

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34 Follow up on quality gaps Workflow change to close quality gaps Complete reporting requirements Engage patients in healthcare

35 Managed Medicare Quality Measurement Comparison

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37 National Committee for Quality Assurance

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40 Clinical Integration Program (About 500 commercially) Network of otherwise independent physicians who collectively commit to quality and cost improvement. Separate legal entity. A set of clinical and administrative metrics defining the network s performance improvement goals Membership selectively limited to those physicians able to advance those goals A system to monitor physician performance against those goals A physician-led governance structure to oversee program operations, supported by administrative staff An IT infrastructure to identify improvement opportunities and facilitate exchange of patient information between participants Performance-based payment incentives to motivate physician achievement of goals Joint contracting with commercial payers/employers for physician services

41 ACO (Medicare) Legally structured group of providers potentially including physicians, hospitals, post-acute providers, and others who are collectively responsible for the care outcomes of a patient population for a defined period of time. An aligned physician network, with physicians integrated either through CI or extensive employment An IT infrastructure that facilitates exchange of patient information and identification of care improvement opportunities An optimal capacity strategy, including a streamlined acute care enterprise and a comprehensive ambulatory network Transformed clinical operations, including standardized care pathways, emphasis on primary care, smooth care transitions, and patient activation Partnerships with payers willing to collectively reward all participants for better population management (e.g., payment bundles, shared-savings, global risk)

42 ACO (Medicare) Pioneer Model 13 of 32 participants dropped out. Advance Payment Model 35 participants physician based in rural areas Next Generation Model 404 Participants Upside only 401 Two sided risk 3 Networks of individual practices 225 Group practices 149 Hospital/Professional Partnerships 136

43 No one integration model has proven to be clearly superior to others Ability of an organization to achieve tangible improvement in cost and quality depends more on strong clinical leadership and the organization s culture and commitment to improvement Clinical Integration: A Cornerstone for Population Heath Management. Journal of Healthcare Management 60:3 May/June 2015

44 Will Clinical Integration affect my independence to manage patients? Will peers and patients be aware of my performance? Will peer benchmarking be done with similar patient populations for all providers? Will my productivity be affected by having to meet clinical integration quality of care guidelines? What are the financial implications, positive or negative at a personal level? Will the data collecting process be fair and use all possible channels to collect data? Will I be penalized for patient lack of compliance when I attempted to meet the clinical guidelines and patients refused? What are the financial implications for joining this program?

45 Will the culture of my practice fit in the with the program I am interested in? How close am I to retirement? Does my practice utilize alternative payment methodologies beyond fee for service currently? What is the size and makeup of the provider network? Primary versus specialty, employed versus independent, etc.? What is the structure of the program? Who are the leaders? What does the governance look like? What is the payer mix, how many patients lives are covered? What is the financial viability of the program (if using at risk)? How are shared savings and pay for performance payments calculated?

46 How is data being collected and shared? How will I be able to provide better care to my patients? Will I be required to change EHRs, if so how is that paid for? How are quality and performance metrics developed and what systems are in place to collect and assess the data? How will performance data be shared will all members of the care team? What criteria are used in determining medical necessity? Does the program require Medical home recognition/certification? Will the program provide a care coordinator or other clinical support staff in my office? What is the payment methodology used by the program?

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