Value model in the new healthcare paradigm: Producing value at a single specialty center.

Value model in the new healthcare paradigm: Producing value at a single specialty center. State of Spine Surgery Think Tank June 17, 2017 Catherine MacLean, MD, PhD Chief Value Medical Officer Center for the Advancement of Value in Musculoskeletal Care Hospital for Special Surgery

2 Title of Presentation Here Value Mandate

Historical Perspective on Value-based Payment: Code of Hammurabi Hammurabi ruled Babylonia between 1795-1750 BC Developed codex of 282 laws inscribed on a stone stele Includes earliest known medical fee schedule: Payment based on result Penalties for bad outcomes 215-217 If a surgeon has made a deep incision in the body of a gentleman with a lancet of bronze and saves the man's life or has opened a carbuncle in the eye of a man with a lancet of bronze and saves the eye, he shall take 10 shekels of silver. If the patient is a freeman, he shall take 5 shekels of silver. If the patient is a slave, the master of the slave shall give 2 shekels of silver to the surgeon. 218 If a surgeon operate on a man for a severe wound with a bronze lancet and cause the man's death, or open an abscess in the eye of a man with a bronze lancet and destroy the man's eye, they shall cut off his fingers. 3 Spiegel AD. Manag Care. 1997;6:78-82.

US Policy Makers and Payers Question What US Health Spending Buys 4

How the US Spent $2.1 Trillion in 2013 Personal Health Care Spending in the United States by Age Group, Aggregated Condition Category, and Type of Health Care, 2013* * DUBE = diabetes, urogenital, blood, and endocrine diseases. 3 Most Expensive Conditions, 2013 Diabetes $101.4 B 5 Dieleman JL, et al. JAMA. 2016;316(24):2627-2646. Ischemic Heart Disease Back & Neck Pain $88.1 B $87.6 B

Cost of Low Back and Neck Pain Cost of back and neck pain over time. Substantial increase in spending between 1996 and 2013. Distribution of costs for back and neck pain. Spending driven largely by ambulatory and hospital care. 6

Worsening of Spine Symptoms Over Time in US Population Self-reported Health Status and Disability Measures for Adults With Spine Problems, Age- and Sex- Adjusted, MEPS 1997-2005a Martin BI, et al. JAMA;2008;299:656-664. 7

Defining Value VALUE = Quality Cost Most value-based purchasing programs currently focus largely on Improved Individual Health & Wellbeing Absent routine measurement of Timely & Effective Return to Function Patient Satisfaction with care delivery and outcomes Impossible to realize Avoidance of Adverse Events Avoidance of unnecessary diagnostics & procedures Least expensive inputs to achieve quality 8 Achievement of population health and cost goals

Anticipated Distribution of Payment Models Healthcare Payment Learning and Action Network White Paper on Alternative Payment Models; 1/12/2016.

The Building Blocks of Value Unit-Drug or Device Least expensive to produce desired outcome Opportunity: Use fewer or less expensive units. Risk: Use of less effective units. Procedure-TKA, THA DRG incudes drugs, devices, facility fees, readmission Professional includes evaluation, procedure and follow-up Opportunity: Efficient management of procedure. Risk: Inappropriate procedures; skipping important care components. Episode- BPCI, CJR, other Bundles Facility and professional procedure, costs Post-acute care-procedure-related, OR all care for defined period Pre-acute care: possibly care for defined period Value opportunity: Care coordination; pre-procedure risk optimization; reduced AEs, readmissions; avoidance of unnecessary post-acute care. Risk: Inappropriate procedures; skipping important care components; cherry picking Condition / Disease-Back Pain, OA, RA, others Case rate, management fee or gain share to manage disease Opportunity: Disease optimization; care coordination; reduced ER visits and hospitalizations; appropriateness; secondary prevention. Risk: Withholding needed or best care. 10 Population-Employees, plan members; All health-or condition- management, e.g. musculoskeletal Fee to manage all care; typically pmpm Opportunity: Primary prevention; care coordination; appropriate utilization. Risk: Withholding needed or best care.

HSS VALUE INITIATIVES 11 Title of Presentation Here

HSS Principles for High Value Care Patient First Evidencebased Care Manage Longterm Total Cost Improve health consistent with patient preferences Avoid harm Physical Financial Base clinical decisions on best available evidence Utilize diagnostic and therapeutic services with evidence of efficacy Do not perform diagnostic and therapeutic services with evidence of little or no effect Avoid unnecessary care Costly and potentially dangerous Standardize efficient care pathways Utilize least expensive therapies for desired outcomes Manage entire episode of care; address condition 12

Better Advancing The State of Value-Based Musculoskeletal Care Delivering Value Today Adopting new payment models: BPCI, CJR, Commercial Bundles Coordinating care across the entire episode: advanced practitioners, relationships with skilled nursing facilities Continuous value-based improvement: discharge home, length-of-stay Value timelines: Analysis and visualization of patient outcomes and complications relative to utilization of services and cost of care 13

Redesigning the HSS Episode of Care HSS Chronic Care --Assessment - PROMs Collection - Referral to appropriate care - Risk Assessment Data Utilized - Surgical workup - Surgical vs. Non-surgical PCP/Community Care Expanded focus beyond inpatient care. Coordinated care across all phases and sites of care. 14 Co-Morbidity Identified Patient Enters Care Management Protocols Inerventions Delivered Prior to Surgical Encounter, Maintained throughout Care Ongoing Care Management Support through Innovative Tools/Patient Care

Case Study: FastTrack Spine Care for Back Pain Getting spine patients to the right provider in a timely fashion for the most appropriate care, while serving as an entry point for episode management Non-surgical Treatment for 95% Timely care Better outcomes Images, non-surgical procedures limited per evidence-based protocol Lower medical cost Less time off work Reduced presenteeism Rapid Access to Care Provider within 24 hours Evidence-based treatment plan based on patient goals, preferences, risk factors and appropriateness criteria Appropriate surgery in minority of cases High Value Care 15 Care Coordination Across Sites of Service and Providers

Post-Acute Network Management Developed key relationships with select SNFs to enhance communication and care coordination Devoted FTE to track and coordinate care for HSS patients discharged to SNFs. SNF Care Coordination Facilities were vetted and selected based on various factors including quality ratings, geographic locations, and patient experience HSS s TJA sub-acute pathway indicates an appropriate SNF LOS is 5-7 days for noncomplicated patients Average LOS at HSS Care Coordination Facilities (CCF) 2014 16.8 days 7.5 days Since start of CCF program 16 16

Better Advancing The State of Value-Based Musculoskeletal Care Delivering Value Today Adopting new payment models: BPCI, CJR, Commercial Bundles Coordinating care across the entire episode: advanced practitioners, relationships with skilled nursing facilities Continuous value-based improvement: discharge home, length-of-stay Value timelines: Analysis and visualization of patient outcomes and complications relative to utilization of services and cost of care Measuring Value Defining the right measures: patient-reported outcomes (PROMs) More effectively capturing and monitoring data: e.g. wearables Embedding value measurement and management into clinical practice Measuring presenteeism Assessing, understanding and meeting patient goals 17

HSS is Adopting Routine PROM Collection as a Standard of Care To inform clinical decisions Risk Stratification Therapeutic Choice To measure our performance Quantify patient outcomes Advance clinical care Report performance to patients and other stakeholders To prepare for anticipated reporting requirements Build operations needed for reporting Understand scores in advance of reporting To advance the science of PROMs as quality measures before they are reported publicly What is the minimal clinically important change in a PROM? What is the best way to report PROMs to the public How should PROMs be used as measures of quality or appropriateness? 18 HSS PROM Standard for all patients: Uniform general health measure: PROMIS Global Disease-specific measure: Uniform across service lines Collected at all patient encounters and at specified time points before and after certain treatments.

PROM Data Collection- Utilizing Multiple Touch Points Electronically prior to visit: MyHSS Link to collection method through MyHSS Other electronic platform with Epic interface Pre-visit phone call By the nursing call center while performing IPA In person prior to radiology visit In waiting rooms of physician offices Pre-registration during patient calls from registrars During the PSS day Initiative kicked off 12/2016 for PROMIS among preoperative patients >10,000 surveys completed as of 5/30/2017 19

Presenteeism: At Work But Out of it Significant impact on employer costs Does medical care reduce presenteeism? Measuring presenteeism in a population of patients undergoing total knee arthroplasty, total hip arthroplasty, and spinal lumbar fusion/decompression before and after surgery Evaluating the impact of surgery on presenteeism Comparing presenteeism across procedure groups 20

Better Advancing The State of Value-Based Musculoskeletal Care Delivering Value Today Adopting new payment models: BPCI, CJR, Commercial Bundles Coordinating care across the entire episode: advanced practitioners, relationships with skilled nursing facilities Continuous value-based improvement: discharge home, length-of-stay Value timelines: Analysis and visualization of patient outcomes and complications relative to utilization of services and cost of care Measuring Value Re-Defining Value for the Future Defining the right measures: patient-reported outcomes (PROMs) More effectively capturing and monitoring data: e.g. wearables Embedding value measurement and management into clinical practice Assessing, understanding and meeting patient goals Measuring presenteeism Artificial intelligence for real-time, more accurate diagnosis Predictive analytics for more proactive (vs. reactive) care delivery Transformation of supply chain through lower-cost products / devices 21

Personalized Health Management 22

HSS Personalized Health Management Initial Communication Questionnaire Risk Assessment Treatment Options Follow-up Patient Reports Back Pain Condition is either chronic or acute onset Designated Portal Patient navigates to designated portal Questionnaire Patient fills out patient questionnaire assessing back pain history, treatment goals and preferences. Risk Assessment Patient risk factors such as comorbid disease, BMI, smoking, and physical activity are assessed Treatment Options Treatment options are presented along with patient-specific predictions on the likelihood of improvement, achievement of goals and complications Follow-up Collection of PROMs, Ongoing risk assessment, patient-provider communication channel 23

THANK YOU! 24