Promoting Value Through Transparency

Promoting Value Through Transparency Program, Training and Implementation Stephanie Benintendi, Corporate Director, Patient Access Centura Health April 27-28, 2017

Promoting Value Through Transparency

Agenda What is it? What does it mean to you now? Federal/state regulations Section 1.501(r) Market analysis and trends Centura s Journey: Balancing Science with Art Centura Health 2020 Market basket pricing Self-pay packages Self-pay discount Transparency Hotline Overall estimate accuracy Where are you? 3

Mission Centura Health Bio We extend the healing ministry of Christ by caring for those who are ill and by nurturing the health of the people in our communities Sponsors Catholic Health Initiatives Adventist Health System Colorado and Western Kansas region s largest health care network 17 Hospitals 13 Affiliate Hospitals 16 ambulatory surgery centers 12 occupational medicine clinics Outpatient rehab centers 250+ physician clinics 7 home health agencies 9 urgent care centers 3 free-standing emergency room 3 mountain clinic ERs Flight for Life Colorado Outreach lab 26 draw stations 37 imaging centers Radiation Oncology 8 campuses 2 senior living communities 2 ambulatory senior health clinics 6 hospices 2 blood donor centers 4

Centura Health by the Numbers* Statistic Numbers Hospital Inpatient Admissions 101,982 ER Visits 505,936 Surgeries 100,474 Deliveries 14,366 Attributed Lives 306,697 Long-Term Care Resident Days 72,005 Home Health Patients Served 16,643 Physician/Clinic Visits 1,493,786 Net Operating Revenue $3,443,658,000 Charity $152,610,000 *for fiscal year ending June 30, 2016 5

What is transparency? What is value? What does transparency mean within healthcare reform? Provide a methodology for the patient to shop fairly. Uninsured: Market basket pricing transparency on website Insured: Factor in commercial contract rate (confidential!) Educate the patient on their health benefits. Create a process flow to pull it all together to increase POS collections. Value: The quality of a healthcare service in relation to the total price paid for the service by patients, insurers, and others 6

Section 1.501(r) Applicable to all 503(c)(3) organizations. Refund safe harbor prevents you from requiring collections/deposits that are more than AGB without financial assistance screening. Can affect your POS collection rate OR Require shift in resources to screen upfront 7

Strengthening our foundation Moving upstream to manage health Creating systems of care Centura Health 2020 Advanced medical technology Integrated EHR Increase associate partnership and satisfaction Reducing variation in care Targeted reductions in cost Integrating analytics Meaningful use Multi-specialty culture Restructure the patient, doctor and hospital relationship Move from sick care to wellness care Promoting wellness and preventative care Reaching rural communities with access to care, education and support Collaborate on best practices Optimize value by integrating cardiac, trauma, oncology, neuroscience, pediatric and senior service networks 8

Market Trends Free standing and retail emergency room/urgent care, ambulatory surgery centers, free standing radiology centers, free standing sleep centers. Increased consumerism due to high deductible plans. Shoppers Patient s delaying care due to ability to afford care Commercial payers with their own transparency tool. Increased physician participation in ACOs to limit costs. 9

Market Analysis Self-pay to commercial volume comparison. What is their method of accessing care---emergency room or scheduled/elective care? Different strategies needed for self-pay, Medicare and commercial patients. Gross price, market price and self-pay price analysis. Do most consumers base their decisions on overall value (cost, outcome effectiveness, service and convenience) as opposed to simply the cheapest price? Do consumers seek health care where they feel comfortable? Ease of access and a strong educational element to our transparency strategy will be key components under the service and convenience aspects of the value equation. 10

Market Findings Self-pay/uninsured volume is very low. Most self-pay consumers come through the emergency department. Commercial consumers: Cost to a commercial member will be much different than Centura s price, as member cost is heavily dependent on the particular member s deductible and out of pocket liability Commercial price transparency has severe limitations due to the confidentiality of payer contracts as well as the variance in commercial contracted rates and individual benefit plans The real ability to provide this sort of commercial transparency lies with the commercial payers themselves, though Centura Health can as well 11

Market Findings Medicare has their own unique set of concerns. Price competitiveness is less of a selling point since cost is going to be the same to the member wherever they go These consumers will most likely be focused on the outcome effectiveness, service and convenience components of the value equation Consumers under these populations may not have access to a computer. Telephone and in-person contact will be a key component in serving a large portion of these populations. Centura Health is currently ahead of its market competitors in regard to transparency, but significant opportunity exists to advance this strategy and promote Centura Health as the market leader in overall value. 12

Centura s Journey: Balancing Science with Art 13

Strategic Work Plan 2020 14

Scenario Planning 2020

Market Basket Prices Phase I Self-pay only Prices were adjusted based on market values and vary by region Denver Metro, El Paso County, La Plata County, Pueblo & Canon City Metro, Summit County, and Kansas 63 CPT and DRGs Selected by CHA Does not include ancillary services HIS system will adjust that particular code to the market price; all others will adjust 50% for uninsured discount 16

Market Basket Prices 17

Website Attributes

Self-Pay Packages Most common/consistent Bariatric OB Cosmetic The rest OB w/wo newborn, epidural and circumcision Colonoscopy Tonsils Knee scopes And 50+ others! 19

Self-Pay Package Issues Too much variation in same region Doc deals Creates conflict with market basket and selfpay discounts 20

Self-Pay Packages Current State 4 out of 5 regions have moved away from self-pay and follow exclusively market basket or self-pay discount Extraordinary market factors in 5 th region regarding bariatric and OB competition South Denver: decrease in birth rate with increase of late/no prenatal care Source: Colorado Dept of Health, 8/14/16. http://www.chd.dphe.state.co.us/resources/vs/2015/douglas.pdf 21

Self-Pay Discount Phase 2 All hospital and physician services automatically receive 50% off if the account is listed as self-pay at the time of billing Phased in based on Epic implementation Self-pay stats: 4% of total net revenue 6% of visits 1% of non-ed net revenue Before FA determination Market basket prices take precedence if less Lesser of self-pay discount or market basket price 22

Transparency Hotline One central number on websites that direct consumers to Corporate Patient Access Consistent estimates Tracked volume Uses same tool as facilities that can be used if patient does come to facility for services to see estimate given by Hotline 23

Overall Estimate Accuracy* Month of January 2017 Liability Report Contract Manager Charge CarePricer Charges Data Facility Desc User ID Sum of CM Gross Charges Sum of CP Gross Charges Percentage Accuracy EPIC - Avista Adventist Hospital $ 1,691,182.91 $ 2,492,707.16 68% EPIC - Castle Rock $ 2,235,771.36 $ 2,284,338.14 98% EPIC - Littleton Adventist Hospital $ 8,993,870.80 $ 8,865,749.34 101% EPIC - Longmont United Hospital $ 1,677,417.18 $ 2,052,065.19 82% EPIC - Mercy Regional Medical Center $ 260,871.27 $ 229,690.29 114% EPIC - OrthoColorado $ 14,464,171.64 $ 14,361,280.91 101% EPIC - Parker Adventist Hospital $ 4,234,186.01 $ 6,079,328.17 70% EPIC - Porter Adventist Hospital $ 10,040,426.91 $ 9,370,026.41 107% EPIC - St Anthony Hospital $ 7,438,322.45 $ 9,733,045.02 76% EPIC - St. Anthony North $ 2,728,420.96 $ 3,345,416.27 82% EPIC - St. Anthony Summit Medical Center $ 365,401.43 $ 374,551.94 98% Penrose St. Francis $ 15,897,829.81 $ 16,095,699.10 99% St Catherine Hospital $ 1,074,643.04 $ 1,842,593.24 58% St. Mary-Corwin Medical Center $ 3,773,510.72 $ 3,548,618.55 106% St. Thomas More Hospital $ 696,884.49 $ 571,414.99 122% (blank) (blank) (blank) Total Grand Total $ 75,572,910.98 $ 81,246,524.72 93% *NAHAM AccessKeys 3.0 Good 85%: Better 90%: Best 95%

Where Are You? Strategic Planning Short term and long term Project Plan Map out resources needed Key stakeholders identified Infrastructure Support Staffing, systems, policies Make it obtainable but challenging 25

Guiding Principles 1. Price transparency should empower patients and other care purchasers to make meaningful price comparisons prior to receiving care. It should also enable other care purchasers and referring clinicians to identify providers that offer the level of value sought by the care purchaser or the clinician and his or her patient. 2. Any form of price transparency should be easy to use and easy to communicate to stakeholders. 3. Price transparency information should be paired with other information that defines the value of services for the care purchaser. 4. Price transparency should ultimately provide patients with the information they need to understand the total price of their care and what is included in that price. 5. Price transparency will require the commitment and active participation of all stakeholders. Retrieved 1/31/2017 HFMA Website; http://www.hfma.org/content.aspx?id=28796 26

Questions Stephanie Benintendi Corporate Director, Patient Access Revenue Management Centura Health 303-643-1182 (phone) stephaniebenintendi@centura.org Visit us at www.centura.org 27