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0 Multi-stakeholder Payment Reform and System Redesign: Working Together to Improve Healthcare Value Elizabeth Mitchell CEO Maine Health Management Coalition.

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Presentation on theme: "0 Multi-stakeholder Payment Reform and System Redesign: Working Together to Improve Healthcare Value Elizabeth Mitchell CEO Maine Health Management Coalition."— Presentation transcript:

1 0 Multi-stakeholder Payment Reform and System Redesign: Working Together to Improve Healthcare Value Elizabeth Mitchell CEO Maine Health Management Coalition

2 1 Maine Health Management Coalition The Maine Health Management Coalition Foundation is a public charity whose mission is to bring the purchaser, consumer and provider communities together in a partnership to measure and report to the people of Maine on the value of healthcare services and to educate the public to use information on cost and quality to make informed decisions. 16 Private Employers 5 Public Purchasers 21 Hospitals 14 Physician Groups 5 Health Plans Employers Health Plans Providers Collectively 35% of Comm. Market The MHMC is a purchaser-led partnership among multiple stakeholders working collaboratively to maximize improvement in the value of healthcare services delivered to MHMC members employees and dependents.

3 2 quality / outcomes + Value = improved health + employee satisfaction cost Best quality health care Best outcomes and quality of life Most satisfaction For the most affordable cost For all Maine citizens MHMC Value Equation

4 Maines Economy Has Moved From Manufacturing to Healthcare Manufacturing Health Care

5 Maine Has 5 th Highest Insurance Premiums in U.S. For Singles Maine

6 20-25% of Chronic Disease Admits Return Within 30 Days

7 Maine Has 3 rd Highest Rate of Surgeries in U.S. Maine

8 But Inpatient Utilization Is Low, Meaning Cost/Day is Higher Source: Commercial Cost Variation by Hospital Referral Region, Milliman August 2010 Portland

9 Spending on Physicians is Below Average Source: Commercial Cost Variation by Hospital Referral Region, Milliman August 2010 Portland

10 Multiple Cost Drivers Require Multiple Strategies 9

11 10 1)Performance Measurement and Public Reporting 2)Consumer Engagement 3)Value Based Purchasing 4)Reformed Payment/Effective Incentives 4 Steps to Improving Health Care Value

12 Meaningful system performance measurement and public reporting is necessary for accountability to purchasers, patients and community. Transparency of cost, resource use and appropriateness Transparency of utilization rates and patterns Transparency of patient outcomes and experience Transparency of quality and safety 11

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15 14 Employer Use State of Maine Tiered Networks –Hospital based on PTE Metrics - 2006 Added cost of care w/ quality Aug 2011 –PCPs based on PTE Metrics - July 2007 Other Employers/Plan Sponsors –Jackson Lab and Barber Foods – January 2011 –U Maine System – January 2012 –MMEHT – January 2012

16 15 Employer Use Employer members choose if/how to use performance measures Consistency across employers preferred by providers Gradual raising of the bar on performance Transparent, multi-stakeholder process important to employees and providers Threshold: Achieving minimum of Good in every category (only quality/safety for 5 years)

17 16 Employer Use Exceptions made for ACO pilots: Higher value initiatives –MaineGeneral- Cary –PenBay - SMMC Drove provider and employer engagement on delivery system and payment reform RFP for direct contracts: JAX Network Design: MaineSense

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20 Cost Variation 19

21 Publishing Hospital Costs How the data is used is what matters: Without tiering: Low cost hospitals negotiated higher rates With tiering: High cost hospitals renegotiating lower rates to be included in network (4.7%) 20

22 If food prices had risen at medical inflation rates since the 1930s. *Source: American Institute for Preventive medicine 2009 1 dozen eggs$85.08 1 pound apples$12.97 1 pound sugar$14.53 1 roll toilet paper$25.67 1 dozen oranges$114.47 1 pound butter$108.29 1 pound bananas$17.02 1 pound bacon$129.94 1 pound beef shoulder$46.22 1 pound coffee$68.08 10 Item Total$622.27

23 Employee engagement curriculum to develop optimal incentives and engage patients in their role to improve their health and healthcare: Module 1: Examining What You Have, Determining What You Want Module 2: Bright Spotting: Best Practice Locally, Regionally and Nationally Module 3: Securing High Quality Healthcare Services Module 4: Preventing Poor Health Module 5: Monitoring Your Benefits Package to Assure the Best Value for Benefit Dollars 22

24 I am part of labor representing about 360 members. My members can not afford a healthcare plan that does not give them the best possible outcome or quality of care. The classes have taught me the buying power of our group. We should not pay for bad results or poor quality of service. As consumers, we need to be more pro-active in our healthcare. - City of Portland Employee Before I learned about the work of the Coalition, I thought the only thing I could do about healthcare was complain. - Prof. Arthur Hill, UMaine Employee 23

25 Accountable Benefit Design Option Explanation/Rationale Incent Selection of PCP provider in ACO If primary care is to be foundation of ACO, plan must encourage use of selected practices Incent PCP visits v. ER visitsEstablish significant differential to obtain care at PCP or network urgent care Incent compliance with preventive care 100% coverage or preventive services and age- sensitive screenings linked to health credit Incent participation in practice based care management Waive all co-pays for participation in practice based care management for members with chronic conditions

26 25 Employers Pay For: Tests Visits Procedures Prescriptions Errors & Complications Employers Want: Informed Employees Improved Outcomes Care Coordination Prevention Functional Status Return to Work You Get What You Pay For

27 26 Dr. Steele: The Way YOU Pay is Major Part of Problem! Population Health for 20,000 People Primary Care Psych Clinic, Home Health, EMS, Nursing Home, Etc. Inpatient Beds Lab and Other Ancillaries Imaging Surgical and other Procedures Total Joints Rests on the head… of a pin ER LOSE ?? LOSE $$ $$$

28 Example: Maines Transition to Global Payments & ACOs PURCHASERSPROVIDERSFACILITATOR State Employees Health Commission and UMS Maine General Health Maine Health Management Coalition Bath Iron Works MidCoast Health System Data Technical Assistance

29 Best Opportunities for Short-Term Significant Success Choosing a Starting Point in Moving to Higher-Value Care Conditions Affecting Many Patients Services With Evidence of Over- Utilization Low-Cost Interventions With Significant Short-Term Impact Willing and Able Clinical Leadership

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32 Its not about risk or incentives, its about giving healthcare providers the ability/flexibility to improve outcomes and reduce costs in a way that is financially feasible Desired changes in care should drive payment reforms that support them, not the other way around Principal Tools: –Episode-of-Care Payment –Risk-Adjusted Global Payment Payment Reforms Needed that Support Care Changes

33 Payers Need to Truly Align to Allow Focus on Better Care Payer Provider Payer Patient Better Payment System A Better Payment System B Better Payment System C Even if every payers system is better than it was, if theyre all different, providers will spend too much time and money on administration rather than care improvement

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36 Many Changes in Care Needed to Achieve Significant Savings Category of Spending Projected Spending Change in UtilizationSavings Advanced Imaging$971,879-20%($194,376) ER Utilization$755,969-15%($113,395) ACSC Hospitalizations$2,380,536-40%($952,214) Back Surgeries$506,451-10%($50,645) CABGs$546,673-10%($54,667) Other Hospitalizations & SNF$22,052,815-3%($661,584) Other Physician Services$13,320,2980%$0 Other Outpatient Services$4,527,8800%$0 Home Health, Hospice, & DME$6,437,5000%0 $51,500,000-3.9%($2,026,882)

37 Identifying Opportunities and Strategies for Win-Win Savings Questions to Address: –Is this a desirable opportunity to pursue? –Does the opportunity vary among regions or among employers? –What are the barriers and how could they be overcome? –What does each stakeholder need to do differently to support success? Employers/Medicaid Health Plans Hospitals Physicians Consumers/Patients/Families –What additional information is needed to develop the business case for a win-win-win approach and implement the changes?

38 Who, What and How? Employers –Patient Incentives through Benefit Design/Wellness –Informed purchasing with performance data – reward high performance –Payment reform – pay for what we value (PCMH) Providers –High-value, coordinated, patient centered care –Shared Decision Making –Increase primary and effective care/Decrease services of limited value –Transparent cost and quality information Health Plans –New roles, products and reimbursement systems Patients –Informed choice and engagement to seek appropriate care –Awareness of risks/benefits with reliable information –Personal health responsibility

39 Key Next Steps 1.Access and use your data 1.Identify key cost drivers 2.Quantify and prioritize opportunities 2.Build partnerships with providers 1.Set clear goals with physician leaders to change care delivery and lower cost 3.Do your part- benefit design/reimbursement changes to support accountable care 38

40 Key Next Steps 4. Expect Accountability 1.Review transparent data - monitor impact 2.Reward success 3.If progress is not made, act 39

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