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Bundled Payments Stacey Schulz, MBA Sr. Contract Manager UnityPoint Health - Meriter Stephanie Cain, APN, DNP Advanced Practice Nurse - Colorectal Center.

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Presentation on theme: "Bundled Payments Stacey Schulz, MBA Sr. Contract Manager UnityPoint Health - Meriter Stephanie Cain, APN, DNP Advanced Practice Nurse - Colorectal Center."— Presentation transcript:

1 Bundled Payments Stacey Schulz, MBA Sr. Contract Manager UnityPoint Health - Meriter Stephanie Cain, APN, DNP Advanced Practice Nurse - Colorectal Center UnityPoint Health Peoria- Methodist Medical Center

2 Purpose & Learning Objectives Give an overview of Bundled Payment initiatives at UnityPoint - Meriter and UnityPoint - Peoria Methodist –What are Bundled Payments? –How do we structure a Bundled Payment Program? –What is impact of Bundled Payments on delivery of Care? 2 Bundled Payments

3 Fee For Service Payments Separate payments for each service during a single illness or course of treatment –Fragmented provision of care –Minimal coordination across providers and health care settings –Rewards quantity vs. quality 3 Bundled Payments

4 What are Bundled Payments? A lump sum payment for an entire episode of care –More coordinated care –Higher quality outcomes –Lower cost to payors/patients –Opportunity to align incentives for providers across the care continuum 4 Bundled Payments

5 Available Opportunities Partnership for Healthcare Payment Reform – Private Payor Bundle Pilot Center for Medicare and Medicaid Innovation (CMMI)’s Bundled Payments for Care Improvement Initiative (BPCI) 5 Bundled Payments

6 PHPR Initiative sponsored by the Wisconsin Health Information Organization: provide superior healthcare at affordable costs Total Knee Replacement Pilot –Bundled Payment with a private payor –Collaborative communication and feedback amongst participants (providers and payors) –Ability to design episode of care and required performance measures 6 Bundled Payments

7 CMMI – Bundled Payments for Care Improvement Initiative Four innovative payment models –Financial and performance accountability measures –Care redesign/enhancements Evidence-based medicine Standardized operating protocols Improved care transitions –Potential to gainshare 7 Bundled Payments

8 BPCI Models of Care Model 1: Retrospective Acute Care Hospital Stay Only Model 2: Retrospective Acute Care Hospital Stay plus Post-Acute Care Model 3: Retrospective Post-Acute Care Only Model 4: Prospective Acute Care Hospital Stay Only 8 Bundled Payments : CMMI

9 Model 2: Retrospective Acute Care Hospital Stay plus Post-Acute Care 48 Episodes (MS-DRG severity family) to select from Post-Acute Episode Length –30, 60, or 90 days 3% discount for 30 and 60 days 2% discount for 90 days Risk Track for Outliers –A: 1/99, B: 5/95, C: 5/75 –Responsible for 20% of episode payments above the high-end threshold Model 2 Waivers –Payment Policy Waivers 3-Day Stay Requirement for SNF Payment Post-Discharge Home Visit Telehealth –Fraud and Abuse Waivers Savings Pool Contribution Waiver Incentive Payments Waiver Group Practice Gainsharing Waiver Patient Engagement Incentive Waiver 9 Bundled Payments:

10 BPCI Model 2 - Meriter Major joint replacement of the lower extremity MS-DRG 469: Major joint replacement or reattachment of lower extremity with major complication or comorbidity MS-DRG 470: Major joint replacement or reattachment of lower extremity without major complication or comorbidity 90 days, 2% discount Risk Track B (5/95) Fraud and Abuse Waivers –Savings Pool Contribution Waiver –Incentive Payments Waiver –Group Practice Gainsharing Waiver Live: January 1, 2014 10 Bundled Payments:

11 CMS Pricing Rules Update Factors Area Wage Index Historical Hospital Claim Data Risk Tracks National Case-mix Weights Low Volume Adjustment Apply Area Wage Index Case-mix Discount Adjustments Target Price $ End Result = 11 Bundled Payment

12 Post-Episode Spending CMS will perform a Post-Episode Spending Calculation for the 30-Day Post-Discharge period after an episode ends –Total expenditures during the 30-Day Post- Episode period exceeding the Risk Threshold (5/95), is excess spending that must be repaid. 12 Bundled Payments

13 Net Payment Reconciliation Amount Target Price Aggregate FFS Payment Net Payment Reconciliation Amount 13 Bundled Payments

14 Opportunity to Gainshare Model 2 Fraud and Abuse Waivers allow the development of a Gainsharing Program to allow Awardees to share savings with providers/practitioners involved in Care Redesign for identified Episodes of Care –Internal Cost Savings –Positive Net Payment Reconciliation Amounts 14 Bundled Payments

15 Gainsharing Program Requirements Ensure care is not inappropriately reduced Maintain or improve quality of care No inappropriate change in utilization or referral patterns Protect against fraud, waste, and abuse 15 Bundled Payments:

16 Bundled Payment Process Convene an interdisciplinary team Define the episode of care Develop performance measures –Financial –Quality Create model of care Price the episode of care Identify cost reduction opportunities Develop gainsharing program Foster a continuous process improvement plan 16 Bundled Payments

17 Interdisciplinary Team Designed to develop and monitor the episode of care and performance –Legal/Policy –Clinical Leaders: inpatient, surgical, therapy, post-acute care –Quality/Performance Improvement –Finance/Data analysis –Administration –Physicians 17 Bundled Payments

18 Turning Physician Interest into Engagement Monthly Meetings For the first time, physicians were able to see how they were performing not only as an individual, but also relative to their peers. We were transparent. We Brought Data Throughout the course of the meetings, we asked for the physicians to help us design the bundle. We included them in the process. We Asked for Help Physicians walked into a room with a room full of administrative and operational power. We were committed. We Demonstrated Solidarity

19 Define the Episode of Care Define episode parameters –Included services and items –Excluded services or items –Related Post-Acute Care –Length of Episode Qualification Criteria –Eligibility criteria –Ex: Age, limitations of co-morbidities, etc. Outlier Protection –Understand where outlier risk resides –Episode development and model of care manages clinical risk not probability risk 19 Bundled Payments

20 Develop Performance Measures Aim to balance cost and quality outcomes Complete analysis of “baseline” cost of episode of care –“Cost” defined as real cost –Segregate variable cost to model volume risk Assign Target Cost for purposes of gainsharing (if applicable) Determine quality measures –Revision rates –Pain scores –Patient satisfaction scores –Return to functionality assessments (KOOS/WOMAC) 20 Bundled Payments

21 21 Bundled Payments

22 Monitoring and Tracking Data Develop a mechanism for tracking data Systematize processes Communicate outcomes and results timely Question outliers and idiosyncrasies –Learn from them and adjust processes, screenings, communications, etc. accordingly Consider sample size –Need an “n” that is significant 22 Bundled Payments

23 Data Analysis Challenge: Linking Disparate Data Pre-admission Surgery Acute-Stay/ Discharge Post-Acute Care Inpatient Stay Records Supply/ Purchasing Records Physician Clinic Records OR Records Home Health Records Insurance Records Pharmacy Records Anesthesia Records Therapy Records Quality Records Records that are owned by other entities 23

24 Create Model of Care Identify standards of care and best practices Understand the cost variation for each component of service –OR –Implant –Inpatient –Therapy –Home Care –SNF –Readmissions Facilitate conversations to identify opportunities by comparing peer-to-peer and against best practice guidelines –Share data and let the data speak for itself –Identify physician champions –Solicit supporting documentation/educational articles, etc. 24 Bundled Payments

25 Pre-bundle Patient Care Pre-admission Surgery/ Acute Stay Discharge Post-Acute Care

26 Post-bundle Patient Care Pre-admission Surgery/ Acute Stay Discharge Post-Acute Care Growing partnership for all stakeholders throughout patients’ continuum of care Increased physician and nursing collaboration to ensure quality care Increased focus on practicing evidenced-based care Improved coordination of care with internal and external stakeholders Increased focus on appropriateness of post-acute care Increased stakeholder awareness for how to deliver high quality, lower cost care The Value of Working Across a Continuum of Care:

27 Price the Episode of Care Define baseline/target price for bundle –CMMI factor in discount –Private payor factor in margin Assess outliers –CMMI Risk Track –Provision for outliers with private payor or manage risk with eligibility criteria Prospective vs. Retrospective –Prospective requires distribution of payments to episode of care providers –Retrospective requires reconciliation and settling –Determine frequency of analysis and reconciliation to settle and close episodes 27 Bundled Payments

28 Identify Cost Reduction Opportunities Understand the detailed cost for each component of the bundle Review standardization opportunities –Major: anesthesiology method –Minor: updating physician preference card Define key cost components to monitor and track –Inpatient Costs –Surgical Costs –Implant Costs –Sum of Variable Costs –Readmission –Emergency Room –Skilled Nursing Facility –Home Health –Outpatient Therapy 28 Bundled Payments

29 2012 Meriter Discharge Data (MS-DRG 470) % D/C Home with OP Follow-up % D/C to SNF% D/C with Home Care % D/C Other PPIC Patients29.5%30.1%39.9%.5% Medicare Patients14.2%60.3%21.4%4.1% Combined Patients (PPIC + Medicare) 19.1%50.5%27.4%3.0% Nationally, Medicare Post-TKA SNF discharge rates average between 37- 45% SNF discharge percentages highly variable across Meriter orthopedic providers (11% to 71%) A recent inpatient chart review of 15 PPIC patients discharged to Skilled Nursing Facilities revealed the following: 7 of the 15 patients reviewed had mobility limitations or lack of support at home that met skilled criteria for SNF admission 8 of the 15 patients were transferring and ambulating without physical assistance prior to acute care discharge and had a spouse or other caregiver available to provide support. Questionable whether skilled criteria met.

30 Meriter’s Gainsharing Mechanism Group Circuit Breakers –Eliminate payment to the whole group if quality materially declined Individual Circuit Breakers –Eliminate individual physician’s payment if defined performance measures are not met, or materially declined 30 Bundled Payments

31 Gainsharing Mechanism Required Savings – 3% CMS Target Price –Allows coverage for administrative costs Additional Savings to be shared 50% with Hospital and 50% with Physicians Qualifying Cases –Payouts are determined based on number of qualified cases –Qualifications are based on criteria and standards set by the group Pain Management Implants LOS OR efficiency, etc. –Physicians can make the best decision for an individual patient and may lose a portion (qualified case) of gain-sharing but is not automatically forfeiting any incentive for the period 31 Bundled Payments

32 Foster Continuous Improvement Quarterly Interdisciplinary Team Meetings –Report Outcomes –Review Variances –Introduce Ideas or Opportunities Performance Dashboard Ongoing review and response to variances or changes in cost or quality data Open communication and discussion of industry articles and research 32 Bundled Payments

33 Online Guided CarePath: 33 Bundled Payments

34 Private Payor Considerations Ability to develop contractual provisions –Compliance –Termination –Available and applicable waivers –Claims processing –Applicable restrictions 34 Bundled Payments

35 35 Bundled Payments CMS Bundled Payment Initiative UnityPoint Health Peoria Methodist Medical Center  Methodist has selected to be paid a bundled rate for major bowel procedures which includes DRGs 329, 330 and 331. (colon resection primary)  Under the bundled payment initiative, Part A & B services are bundled beginning on the first three days prior to hospital admission through 90 days post discharge.  Providers continue to bill Medicare under fee-for-service. At the end of each contract year, a retrospective reconciliation occurs against the target price.  Methodist selected Risk Tract 2 and launched Oct 1, 2013  Methodist is also a medical shared savings participant with 11,000 attributed members.

36 36 Bundled Payments Methodist Triple Aim Objectives A.Improve clinical outcomes of bowel resection patients. B.Coordinate patient care across the continuum to reduce readmissions, unnecessary testing, and patients adherence to recommended care. C.Improve the patient’s experience as measured by HCAHPS scores. D.Increase physician satisfaction through participation in the care redesign process, outcome measurement and economic alignment. E.Improve operating efficiency resulting in lower costs.

37 Peoria Bundle Components 37 Bundled Payments  Physicians’ services  Inpatient hospital services (episode anchor)  Inpatient hospital readmission services  Long term care hospital services (LTCH)  Inpatient rehabilitation facility services  Skilled nursing facility services (SNF)  Home health agency services (HHS)  Hospital outpatient services  Independent outpatient therapy services  Clinical laboratory services  Durable medical equipment  Part B drugs

38 Private Payor Considerations Ability to develop contractual provisions –Compliance –Termination –Available and applicable waivers –Claims processing –Applicable restrictions 38 Bundled Payments

39 Started engaging surgeons 5 months before project started –Weekly meetings; data; 1:1 meetings Shared baseline data early on so all new current situation and opportunity Included in design of gain share model, metrics, and dashboard design Saw need to hire colorectal NP navigator (dual role Bundled project and launch colorectal cancer center) Invested time in gaining surgeon consensus on order sets, processes and procedures Top Initiatives to support project

40 Engaged wide stakeholder groups –Nursing units –Administration –PI analyst –Finance –Case management –Coders –OR staff –Schedulers –Surgeon office staff –Primary care providers –LTC’s Top Initiatives to support project

41 Good engagement from surgeon groups Good awareness and adherence to processes sets from OR and nursing staff –OR staff asking about opening expensive items –Nursing staff and getting patients moving quicker and setting discharge expectations Positive Outcomes

42 Internal cost savings being achieved –ICU LOS and overall LOS down –Cost per Case down (supplies in OR) –Decreased Surgical Site Infection Navigator working well –Patients like having navigator at the hub –Surgeons like navigator to round and provide updates and recommendations Positive Outcomes

43 Outcome Data (first four months)




47 Internal Cost Savings to date Major Bowel Procedures CY 2012 Baseline (Inflated*) Rollup starting Oct 2013 Medicare only All Colon Bundle w/ MedicareOct-13Nov-13Dec-13Jan-14Feb-14Mar-14 n=55293112742 ALOS7. Avg Cost/Case$19,712$16,97413,65222,04813,88413,55518,0187,022 Avg Supply Cost/Case$5,186$3,6772,6844,7213,5053,2063,2442,107 Mortality01010000 Estimated Savings (green)-79,408-18,18125,694-11,656-43,100-6,777-32,402 ICU as part of stay n=15 11 251120 ALOS for entire visit12.6 9.4 5.012.04810.5 ALOS in ICU2.8 21.03.0123.5 Avg Cost/Case for entire visit$30,453$22,63414,68227,98115,47118,82122,704 Avg Supp Cost/Case entire visit$6,842$3,4782,6654,1813,4271,4693,563 Avg Cost/Day in ICU$1,788$1,8021,7752,0271,4081,5341,598 Avg Supply Cost/Day in ICU$87$838293657174 Pts without Complications n=5125 392632 ALOS6. Cost/Case$16,972$15,36413,65218,31213,88412,67720,1537,022 Supply Cost/Case$4,629$3,7432,6844,6673,5053,4963,7742,107 % Pts w/out Complications92.7%86%100821008675100

48 Major Bowel Procedures might not be the best to start with? –Challenges Identification/Coding –Surgeon called in to minor assist and it gets coded as bundle despite “not theirs”- perforated bowel Inclusion & Exclusion Criteria Elective vs. Emergent Cases and no pre-op screening and mitigation Would have hired the NP earlier Lessons learned and opportunities for growth

49 Consensus takes time related to various surgeon practice preference related to training and beliefs –Example- standardized antibiotic use, close vs. open decisions, use of wound vacs, how soon to do surgery vs. wait Surgeons who are on the bundled team are very engaged…they are not so good at getting the processes and information to their peers –Requires going to offices periodically to review data metrics, and gain sharing –Keeping them engaged is helps to have citizenship as part of gain share. Lessons learned and opportunities for growth

50 What/How is critical to helping manage?  Nurse Practitioner, PI, Case Managers What’s missing or challenging? –Sometimes hard to know in the bundle or not? –Patients presenting in crisis so poor outcomes –Not able to take advantage of the SNF waiver due to the nature of the surgery not being 3 day initial LOS and not doing any direct admits post op at this time due to so few readmits that would be stable Miscellaneous

51 Questions? 51 Bundled Payments

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