Medical Management in the Era of Value Based Payments. Rick Lopez, MD

Medical Management in the Era of Value Based Payments Rick Lopez, MD 1

Brief Overview of Today s Discussion Value Based Payment: The Changing Environment of Alternative Payments Ideal Organizational Attributes to Manage Risk The Value Equation Approaches to Successful Management of Financial Risk Where to start.

Challenges in US Health Care Today and Why We Are Moving to Risk Based Payments Costly Limited patient engagement Uncertain appropriateness Unreliable compliance with evidence-based guidelines Incomplete communication across continuum of care A la carte payment for services without accountability for outcomes and quality Perverse incentive with more payment for complications Unjustified variation in care Widely variable outcomes Stunning geographic disparities Often an inverse or no relationship between quality and cost

CMS Goal - Target percentage of payments in FFS linked to quality and alternative payment models by 2016 and 2018 Source: Patrick Conway, M.D., MSc, CMS Innovation and Health Care Delivery System Reform, March 24, 2015

Our Challenge is to Move From To Volume-based reimbursement Value-based reimbursement Price focus Total Medical Expense 5

Degree of Difficulty There is a Spectrum of Value Based Payment Types Discount Arrangement Shared Risk Arrangement Performance Based (P4P) Arrangement Hospital and/or Specialty Capitation Global Budget Capitation Degree of Risk 2015 Atrius Health, Inc. All rights reserved. 6

Degree of Risk Risk Can Also Be Correlated with the Extent of the Population Covered Insurance Capitation Shared savings Medical home/p4p Episode Inpatient bundle FFS DRG 7 Population Covered

How Should We Approach Financial Risk on Medical Expense? 8

Cost Inefficiency In Healthcare PriceWaterhouse Coopers, $1.2T* Institute of Medicine $765B** *Premier s Waste Dashboard, 1/22/12 **IOM (Institute of Medicine). 2012. Best care at lower cost: The path to continuously learning health care in America. Washington, DC: The National Academies Press. 9

Attributes of the Ideal Risk Bearing Organization Organizational Culture/Governance Large Enough Scale to Manage Risk Medical Management Data Reporting and Analysis Health Information Patient Engagement 10

The Value Equation (Q)(S)(PE)(A) C = (Quality)(Safety)(Patient Experience)(Appropriateness) Cost

About Atrius Health Providing care for 675,000 adult and pediatric patients in eastern Massachusetts The Northeast s non-profit leader in delivering high-quality, patient-centered coordinated care. Financially stable with $1.8B annual revenue 750 physicians across 32 clinical sites in over 35 specialties Quality scores ranked #1 in New England and #3 nationally for Medicare ACOs for 2014 Multi-specialty medical groups: Dedham Medical Associates, Granite Medical Group, Harvard Vanguard Medical Associates VNA Care : Home health, palliative care and hospice, private duty nursing 2015 Atrius Health, Inc. All rights reserved.

Atrius Health Core Competencies Corporate Data Warehouse integrates single platform, electronic health record data with multi-payer claims data Widespread Extensive Population Health Management including disease-based and risk-based rosters, population managers Long history with and majority of revenue under Global Payment across commercial and public payers Sophisticated development and reporting of Quality and Performance Measures leading to high achievement Patient-Centered Medical Home foundation, achieving level 3 NCQA across all primary care practices 2015 Atrius Health, Inc. All rights reserved. Not for distribution. 13

Atrius Health is an expert in moving from Volume to Value Epic: 20 years of experience optimizing Epic, HIT system certified at highest level nationally HIMSS Level 7. Full-risk, global payment: Most in-depth experience and expertise with third party commercial and government (Medicare and Medicaid) contracts Model of Care: Physicians are able to work in teams with Advanced Practice Clinicians (NPs, PAs), nurses, and medical assistants. Patient-Centered Medical Homes: Atrius Health primary care practices are recognized as NCQA Level 3 PCMH. Multi-specialty practice: Enables close relationships and curbside consults among primary care and specialists; Behavioral health program integrated with primary care. Hospital collaboration: Extensive network of preferred hospitals with electronic health record (EHR) interoperability, clinical programs Integrated back-office operations: Gain economies and efficiencies 2015 Atrius Health, Inc. All rights reserved. 14

More Difficult Easier There a Just A Few Principles for Managing Financial Risk of Medical Expense and Delivering on the Value Equation 1. Use the lowest cost (but high quality) vendor for services 2. Deliver care in the least intensive ($) location 3. Manage transitions of care 4. Identify and manage the high risk and chronic disease patient 5. Provide superb End of Life Care 6. Deliver Evidence Base Care/Reduce Practice Variation 7. Optimize Coding (I hate this one) Let s consider each one separately

1. Use the lowest cost (but high quality) vendor for services Best achieved through the creation of a preferred set of vendors Seems obvious but not always easily executed For facilities, requires explicit standards, expectations for care in return for preferred status Standards for hospitals might include: Use of preferred VNA and SNF on discharge Interoperability Notification on admission and discharge Expectations around readmission rates Standards for SNF s might include: Use of preferred ambulances and VNA on discharge Appropriate medical information available in a timely manner on discharge Standards around ALOS, rates of readmission to acute hospital Must be able to deliver on volume This principle applies to use of generics for drugs and for Make-Buy decisions for specialty services and procedures.

1. Use the lowest cost (but high quality) vendor for services

1. Use the lowest cost (but high quality) vendor for services Meet service standards SNF willingness to collaborate Good metrics* Created preferred SNF network to enhance the delivery and coordination of care Atrius Health team on-site History of positive relationship Geographic needs *Good Metrics: Medicare Compare; State survey; Readmission during SNF stay; LOS Atrius Health 2015. All rights reserved 18

1. Use the lowest cost (but high quality) vendor for services Comparison of performance in skilled nursing facilities 2.0 LOS = $2M 2% Readmit Rate = $.5M Outer Space Approx. 240 Facilities ALOS: 22.3 Readmit rate: 10.9% % of admits: 30% # of admits: 1,023 TME per case $11,249 Preferred Facilities Facilities: 20 ALOS: 15.8 Readmit rate: 8.4% % of admits: 30% # of admits: 1,026 TME per Case: $9,395 Facilities w Atrius Clinicians Facilities:16 ALOS: 13.9 Readmit rate: 8.3% % of admits: 40% # of admits: 1,380 TME per SNF Case: $7,624 Data is for TMP and Pioneer patients thru November 2014 and is for the three Atrius Health Moving Forward practices; does not include Commercial insured patients) 19

1. Use the lowest cost (but high quality) vendor for services

2. Deliver care in the least intensive ($) location Hospital $$$$ ASC/Procedure Unit $$ Office $

2. Deliver care in the least intensive ($) location There is also opportunity to shift post acute site of service to more appropriate, lower cost settings. Site of Service Opportunity Dollars in Millions Post Acute Cost per Case by Site Savings Opportunity Ranges $40,000 $37,455 $35,000 $30,000 $25,000 $20,000 $15,000 $21,781 $21,760 % Sos Shift $ Savings (M) 10% $28.6 20% $57.2 30% $85.8 $10,000 $5,000 $4,054 $- LTACH SNF IRF HHA Cases: 612 15,082 2,367 48,459 22

3. Manage transitions of care Key components: guaranteed post discharge calls within 48 hours and follow up with a primary care clinician within a week, assuring accurate post discharge medication reconciliation, clear patient communication and teach back, action plans for what if scenarios Tools for avoiding readmissions: VNA Telemetry Use of paramedics for same day visits Self directed care such as use of rescue kits

3. Manage transitions of care Some things Atrius Health is doing: Placing transitional care nurses in preferred hospitals in order to ensure seamless discharges Centralizing post discharge calls to ensure reliability Implementing same day RN visits for fragile patients in lieu of ED Increasing use of home telemetry Rescue kits for COPD Use of geriatric clinical pharmacist to support VNA s in managing patients with complex medications

3. Manage transitions of care

4. Identify and Manage High Risk and Chronic Disease Patients: Follow the money! Bodenheimer T, Berry-Millett R. N Engl J Med 2009;361:1521-1523.

4. Identify and manage the high risk and chronic disease patient Chronic Care, Rising Risk Next 15% Advanced Illness - Top 2% High Risk Poly-Chronic - Another 3% Risk Prevention & Reduction Remaining 80% Tight coordination of 5% highest risk patients and excellent end of life care Management of chronic conditions and care coordination for the next 15% Preventative care and risk reduction for the remaining 80% 27

4. Identify and manage the high risk and chronic disease patient the essence of population health What is the target population? How is the cohort defined? How is accountability defined? What population outcomes do we want & how are they measured? What conceptual framework links potential care processes to target outcomes? What are the overall key indicators? What are interim process/operational indicators? How do we support the key processes required to achieve outcomes? Which of these processes are most effective, efficient, and patient centered? What infrastructure is required to ensure reliable frontline process execution?. Atrius Health 2015. All rights reserved 28

4. Identify and manage the high risk and chronic disease patient the essence of population health Atrius Health CKD Guidelines for Primary Care Stage (egfr) Albuminuria? ( 30mg/g) Serum egfr and Urine Microalbumin Hgb, 25-OH Vit D, Phos, PTH, Lipids, Ca Electrolytes Initial Renal Ultrasound Nephrology Consult Stage 3a (45-59) No Annually* Annually* Consider Stage 3a; (45-59) Yes Q6 Month* Annually* Consider Recommend Stage 3b; (30-44) No Q6 Month* Annually* Consider Recommend Stage 3b; (30-44) Yes Q4-6 Month* Annually* Consider Recommend Stage 4; (15-29) N/A Q3 Month* Annually* Consider Recommend * Might require more frequent monitoring if abnormal and/or if undergoing changing treatment strategies Kidney International, Jan 2013; Supplement 3 KDIGO Clinical Practice Guideline for the Evaluation and Management of Chronic Kidney Disease: 1-150 Approved by the Atrius Health Accountable Care Organization s Geriatric Care Model CKD Workgroup, which includes the Harvard Vanguard Chief of Nephrology; February 2013. Atrius Health 2015. All rights reserved 29

4. Identify and manage the high risk and chronic disease patient the essence of population health Description Clinical guidelines Provider education & training Patient education and engagement Keeping services in-house when appropriate Expectations for outside nephrologists Epic tools Risk score modification Results In first 5 months, 66% of patients with lab defined criteria were diagnosed with CKD triggering clinical interventions. Expected Outcomes Improve diagnosis Slow progression of CKD Atrius Health 2015. All rights reserved 30

4. Identify and manage the high risk and chronic disease patient the essence of population health 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Patients w/egfr<60 CKD Dx No CKD Dx. Atrius Health 2015. All rights reserved 31

4. Identify and manage the high risk and chronic disease patient the essence of population health Primary Care Dashboard: Merge of EPIC and Claims Data - Lab Result Based Total CKD Population - Laboratory Screening (Ca, Phos, CBC, UA, Vit D, PTH) - Clinical Outcomes (BP, LDL, HgA1c) - Referral to Nephrologist Specialist - Visit to Nephrologist Atrius Health 2015. All rights reserved 32

4. Identify and manage the high risk and chronic disease patient For each. Review current state, best practices Choose an assessment tool, develop workflows Develop EMR tools and trackers Set targets Measure and track performance 2015 Atrius Health, Inc. All rights reserved. Not for distribution. 33

4. Identify and manage the high risk and chronic disease patient Chronic/High Risk Toolkit: Longitudinal Case Management PCMH Teamwork Routine outreach Participation by all specialties at point of service Decision support/prompts in the EMR Chronic Disease Rosters Roster Reviews as standard work Monthly performance metrics, unblinded, at the site and physician level

5. Provide superb End of Life Care 36

5. Provide superb End of Life Care Pre Early Middle Advanced Preventi ve Care Disease- Modifying Treatments Birth Diagnosis Death 37 Advance Discussions ( Patient Preferences) PALLIATIVE CARE Advance Directive (HCP) Advance Decision (CC/DNR, MOLST) H O S P I C E

5. Provide superb End of Life Care Description: Developed advance care planning (ACP) curriculum with CME/CEU credits. Established site-based ACP champions to train and provide ongoing ACP support locally Developed new tools in Epic to track and document advance care planning Expected Outcomes: Improve PCP knowledge and comfort with ACP Increase end of life conversations and collection of patient s care wishes, advance directives and proxy information Minimize use of aggressive curative care when not aligned with patient s care wishes 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2013 ACP and 2014 MOLST Trainings ACP 82% MOLST 86% Atrius Health 2015. All rights reserved 38

6. Deliver Evidence Base Care/Reduce Practice Variation Create best practice guidelines Assure EMR support (alerts, order sets) Align incentives (rewards and penalties) Data-sharing and facilitated conversations Dissemination of evidence, existing guidelines Monitoring and feedback of data

6. Deliver Evidence Base Care/Reduce Practice Variation Commonly Overused Clinical Services MRI for low back pain Nuclear stress tests EGD for GERD Arthroscopy Non-generic drugs Imaging for headache Serial PFTs for COPD Pre-op evaluations Cancer screening for elderly Vitamin D testing Echo for benign murmurs PSA testing PAP smears Mammography? Derm referrals for moles A lot more!

6. Deliver Evidence Base Care/Reduce Practice Variation

CBC previsit lab trend - site

7. Optimize Coding Optimal coding reflects the true morbidity of the population and many risk arrangements adjust budgets/revenue based on the populations overall risk score. Budgets for NexGen and Medicare Advantage plans rely on HCC coding to adjust revenue in a zero-sum manner Many commercial risk arrangements rely on DxCG coding to adjust for risk and revenue The ACA has made accurate risk coding for commercial health plans critical

% Chronic RAF (Risk Adjustment Factor) Captured 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 46.79% TMP 69.80% 60.98% 77.71% 81.06% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 40.89% PION 61.45% 52.96% 68.73% 72.39% 0.00% 0.00% February March April May June February March April May June 46 2015 Atrius Health, Inc. All rights reserved.

High Effort Where to start Low Reward Own hospitalists Tele visits NCQA PCMH Certification High Reward Reduce Clinical Variation End of Life Care Integrated Primary/Specialty CDM including BH Identifying Rising Risk Patients Moving more care to the home - Use of Paramedics for same day home intervention - Home infusion - Hospital at Home Referral management Low Effort 47 Data Analytics to Identify High Risk pts Case Managers/facilitators Pop Health facilitators Transitions of care, post acute to reduce readmissions SNF ists to reduce ALOS in SNF s Home Telemetry Identification and Management of preferred vendors (SNF/DME/VNA) Expanded office hours (to accommodate urgencies/convenience/access) Care in lowest cost setting Optimize Coding

Reflections The future we predict today is not inevitable. We can influence it, if we know what we want it to be We can and should be in charge of our own destinies in a time of change. Charles Handy The Age of Unreason 48