0. Payment Reform in Massachusetts: Impacts and Opportunities for the Health Care Workforce
Metro North Regional Employment Board Meeting
Anna Gosline and Jessica Larochelle
June 19, 2013
BLUE CROSS BLUE SHIELD OF MASSACHUSETTS FOUNDATION

1. Overview
The health care payment system is shifting away from fee-for-service models to more aggregated, bundled and global payments
These alternative payment models are spurring new models of care delivery, and creating new opportunities to pay for services that were previously not “reimbursable”
These changes, along with other provisions of state and national reform laws, will impact the demand for health care professionals, both the number and the type

2. Massachusetts Has the Lowest Uninsurance Rate in the Country
PERCENT UNINSURED, 2000–2011, ALL AGES
U.S. AVERAGE
MASS.
2000
2002
2004
2006
2007
2008
2009
2010
2011
NOTE: As of 2008, the state contracted with a new vendor (Urban Institute) to track insurance coverage rates in Massachusetts. The Urban Institute implemented methodological changes to the tracking survey which may affect comparability of the 2008, 2009, and 2010 results to prior years.
The national comparison presented here utilizes a different survey methodology, the Current Population Survey , which is known to undercount
Medicaid enrollment in some states.
SOURCES: Massachusetts Division of Health Care Finance and Policy, Massachusetts Health Insurance Survey 2000, 2002, 2004, 2006, 2007, 2008, 2009, 2010, 2011; U.S. Census Bureau, Current Population Survey, Health Insurance Historical Tables (HIB Series).

3. But the Highest Per Person Health Care Spending in the World
PER CAPITA PERSONAL HEALTH CARE EXPENDITURES, 2009
NATIONAL AVERAGE
State
NOTE: District of Columbia is not included.
SOURCE: Centers for Medicare & Medicaid Services, Health Expenditures by State of Residence, CMS, 2011.

4. Key Affordability/Cost-Related Developments in Massachusetts
2006
2007
2008
2009
2010
2011
2012
Health reform passes (Ch. 58)
Begins path to near universal coverage
Much of Chapter 58 enacted, e.g.:
MassHealth expansion
Commonwealth Care
Consumer affordability schedule
New health plan options for young adults
Employer Fair Share
Cost Containment Part 1 (Ch. 305) passes
Increased transparency about cost drivers
Reports on health insurer and hospital “reserves”
Special Commission on Payment Reform
Recommends move to global payment
Government reports and hearings on cost drivers
Governor rejects small group premiums
Cost Containment Part 2 (Ch. 288) passes
Aims to control premiums for small businesses, individuals
Governor Patrick files payment reform legislation
Special Commission on Provider Price Reform
Cost Containment Part 3 (Ch. 224) passes
Statewide cost growth targets and payment reforms
Continued focus on data transparency
ISELIN

5. Chapter 224 of the Acts of 2012
The law aims to reduce health care cost growth through:
The creation of new agencies (the Health Policy Commission and the Center for Health Information and Analysis)
Setting and monitoring statewide health care cost growth targets
New scrutiny on health care market power, price variation and cost growth at the individual health care entity level
Increased cost transparency for consumers
A focus on wellness and prevention
Expanding the primary care workforce
Other provisions around health resource planning, HIT, medical malpractice reforms, and administrative simplification.
Wide adoption of alternative payment methodologies
MassHealth must have 80% of enrollees in alternative payments by 2015
All payers must, to the maximum extent feasible, move away from fee-for-service

6. Solving the Cost Problem Through Provider Payment Reform
CURRENT FEE-FOR-SERVICE PAYMENT SYSTEM
PATIENT-CENTERED GLOBAL PAYMENT SYSTEM
THE PROBLEM
Care is fragmented instead of coordinated. Each provider is paid for doing work in isolation, and no one is responsible for coordinating care. Quality can suffer, costs rise and there is little accountability for either.
THE SOLUTION
Global payments made to a group of providers for all care. Providers are not rewarded for delivering more care, but for delivering the right care to meet patient’s needs. $ $ $ $ $ $
PRIMARY CARE
HOSPITAL
SPECIALIST
HOSPITAL
SPECIALIST
PRIMARY CARE
HOME HEALTH
HOME HEALTH
GOVERNMENT, PAYERS AND PROVIDERS WILL SHARE RESPONSIBILITY FOR PROVIDING INFRASTRUCTURE, LEGAL AND TECHNICAL SUPPORT TO PROVIDERS IN MAKING THIS TRANSITION. 6

7. The New Ways to Pay and Practice
Global payment/budget – (eg. Accountable Care Organizations)
Usually accepted by a group of providers (sometimes a hospital and it’s physician practices, sometimes just a physician group) accepting responsibility for the total cost of care for a set population or patient group
Large variation in the exact details of the payment; providers may accept various levels of “risk” around meeting per person cost targets
Payments usually dependent on achieving quality metrics
Patient Centered Medical Homes
Accepted by a primary care practice with augmented abilities around managing care both within its own practice and coordinating with specialists and hospitals.
Focus on team-based, patient-centered care and population management
Payments are usually structured as additional per-person care management fees on top of standard fee-for-service payments
Value-Based Purchasing
A bit of a catch-all phrase, mostly associated today with Medicare penalties for high rates of readmissions at hospitals
Bundled and Episode-Based Payments
A single payment to cover all care for a procedure or condition usually over a defined period of time
Often accepted by jointly be a hospital and it’s physician group
Eg. Medicare Bundled Payment demonstration, just launched in 2013

8. Alternative Payments Are Spreading Quickly in Massachusetts
HMO MEMBERSHIP IN BCBSMA’S GLOBAL PAYMENT CONTRACT
75% of HMO membership
646,048
428,600
359,000
328,000

9. Global Payments Are Showing Positive Results on Both Cost and Quality

10. But there Is No Overall Link Between Global Payments and Total Spending – Likely a Reflection of Price Disparities
BCBSMA RELATIVE HEALTH STATUS-ADJUSTED TOTAL MEDICAL EXPENSE
PROVIDERS OPERATING UNDER GLOBAL PAYMENTS
SOURCE: Office of Attorney General Martha Coakley, “Examination of Health Care Cost Trends and Drivers,” June 2011.

11. The Payment Reform Landscape is Spurring a New Wave of Market Consolidation, Potentially Increasing Prices Further
Cooley Dickinson Trustees Choose Massachusetts General Hospital
02/28/ :07 AM
Partners in talks with Hallmark Health
By Steven Syre
GLOBE COLUMNIST  APRIL 17, 2012
Steward Continues Buying Spree;
Globe Reports Deal for Lowell Hospital
April 4, 2011 | 12:37 PM | By Carey Goldberg
Lahey, Northeast Health finalize merger
Boston Business Journal
Date: Monday, May 7, 2012, 6:51am EDT

12. So What Does this All Mean for the Health Care Workforce?
Demand for comprehensive, and community-focused primary care services
Continued strong demand primary care physicians, NPs and PAs
Opportunities for new kinds of lay health care professionals, eg. Community Health Workers
Need for care management and case management
New skills for primary care practitioners and beyond
Emphasis on team-based care, collaboration and coordination
Promoting team-based care skills as part of medical education for physicians, nurses and other health care professionals
Capability with EHRs and population health data analysis
Patient engagement
Cultural competence
Behavioral health integration
Provisions of state and national health reform support many of these goals

13. Primary Care Physicians: Landscape
BERKSHIRE
FRANKLIN
HAMPSHIRE
HAMPDEN
WORCESTER
MIDDLESEX
ESSEX
NORFOLK
BRISTOL
PLYMOUTH
BARNSTABLE
DUKES‡
NANTUCKET‡
94.7
77.3
99.7
94.6
120.2
54.5
59.6
90.3
113.8
58.1
249.7
SUFFOLK
PCP Density (per 100,000 residents)
PRIMARY CARE PHYSICIAN DENSITY BY COUNTY PER 100,000 POPULATION, 2006
‡Due to the relatively small number of physicians and total population size, caution should be taken when comparing rates in this County to rates in other Counties.
Source: Health Resources and Services Administration (HRSA) update to the American Medical Association’s Master File – Physician Characteristics (2006). For more information, visit HRSA at 1Kay Lazar. “Many Continue to Rely on ER: 14% Used Hospital Before Family Doctor,” The Boston Globe (November 2008)

14. Primary Care Physicians: Landscape
PERCENT OF INTERNAL MEDICINE PRACTICES ACCEPTING NEW PATIENTS AND WAIT TIME TO NEW PATIENT APPOINTMENT
Source: Massachusetts Medical Society, 2012 Patient Access to Healthcare Study

15. Primary Care Physicians and Recent Legislation: More and/or Different?
Chapter 224 and the Affordable Care Act (ACA)
Primary care residency grant programs and loan forgiveness programs
Service obligations for federally supported student loans softened
Primary care payment bump
Medicare will increase primary care reimbursement rates by 10% from
Medicaid reimbursement will be increased to at least Medicare levels from
MassHealth alternative payment methodologies
Massachusetts will likely not see the surge in primary care demand predicted nationwide in 2014, as the state already has a well-established universal access reform.
But the fast pace of payment reform adoption and delivery system change will mean major changes, nonetheless.

16. Nurse Practitioners (NPs): Landscape
NURSE PRACTITIONER DENSITY PER 100,000 POPULATION, 2011
Source: Calculations based on The 2012 Pearson Report, The American Journal for Nurse Practitioners, NP Communications LLC.

17. Nurse Practitioners (NPs) and Recent Legislation: More and/or Different?
Key Provisions in Chapter 224
Global signature authority – NPs can now fulfill laws or rules that used to require a signature, stamp, verification, etc. by a physician
Limited service clinics – Expands to the scope to include all services within the scope and practice of NPs
Key Provisions in the Affordable Care Act
Dedicated funds in the Prevention and Public Health Fund to train new NPs
Family NP training demonstration will support new graduates for a year of practice in a federally qualified health center or nurse-managed health clinic

18. Physician Assistants (PAs): Landscape
US Average

19. Physician Assistants (PAs) and Recent Legislation: More and/or Different?
Key Provisions in Chapter 224
Carriers must now recognize PAs as participating providers and cover care provided by PAs for health maintenance, diagnosis, and treatment
PAs are now included in the definition of primary care provider; carriers that require designation of a primary care provider must allow members the option to choose a PA
Physicians are no longer prohibited from supervising more than four PAs at a time
The Health Care Workforce Center’s scope has been broadened to include PAs; information on the status of the PA workforce will be included in its annual report
Key Provisions in the Affordable Care Act
Dedicated funds in the Prevention and Public Health Fund to train new PAs

20. Community Health Workers: Definition
Community Health Workers (CHWs) are public health workers who apply their unique understanding of the experience, language and/or culture of the populations they serve in order to carry out one or more of the following roles:
Providing culturally appropriate health education, information and outreach in community-based settings;
Bridging/culturally mediating between individuals, communities and health and human services, including actively building individual and community capacity;
Assuring that people access the services they need;
Providing direct services, such as informal counseling, social support, care coordination and health screenings; and
Advocating for individual and community needs.

21. Community Health Workers and Recent Legislation: More and/or Different?
Community Health Worker (CHW) Certification Process:
Legislation passed in 2010; went into effect in 2012
The Board will establish standards for:
Education and training of community health workers and community health worker trainers
Education and training program curricula for community health workers
Requirements for community health worker certification and renewal of certification
Other considerations
Grandfathering?
Reimbursement considerations?

22. New Skills – Team-Based Care and Care Coordination
Patient-Centered Medical Homes
Practice redesign with an emphasis on patient communication, after-hours access, care planning, management and coordination, community support and performance measurement
New partnerships beyond the practice
Coordinating care with hospitals, specialists and post-acute care providers
Example: Researchers have found that those with a primary care visit within 14 days of an admission for CHF are much less likely to be readmitted
Behavioral health integration
Patients with mental health and substance abuse disorders, especially those with co-morbid chronic health conditions, are among the costliest patients in the system
Designing innovative care management programs that address the particular needs of this population will be crucial
Will require greater collaboration between providers with different specialties

23. New Skills – EHR and Population Data
There are many forces aligning that will require more sophisticated use of data, electronic data use and sharing
One of the core capacities of NCQA certification for Patient-Centered Medical Home accreditation is the use of data for population management
Even more critical for practices accepting risk for the total cost of care for their patients
Chapter 224 made EHR proficiency a condition of licensure for Massachusetts physicians
HIE data exchange for care coordination

24. New Skills – Patient Activation and Engagement
As providers accept risk for the total costs and quality of care, they will have to build new types of relationships with patients, e.g. “shared decision-making”
ACA identifies patient engagement as a critical component of accountable care organizations and patient-centered medical homes.
When patients are engaged in their health care – more knowledgeable, more confident in managing their health and navigating they system – they experience better health outcomes and incur lower health care costs.
Challenges for providers: overworked physicians, insufficient provider training, and clinical information systems that fail to track patients throughout the decision-making process.
Source: Health Affairs, Health Policy Briefs: Patient Engagement, February 14, 2103

25. Questions/Comments Thank you!
Anna Gosline, Director of Policy and Research
Jessica Larochelle, Director of Evaluation & Strategic Initiatives