Healthcare Leadership Network of the Delaware Valley: Physician Alignment June 2015 Christine Winn, FACHE Senior Vice President, MD Anderson Cooper Cancer Institute and Cooper Physician Alignment

Overview Why is this important? What has happened in the past? Variety of Physician Alignment Models and Preparation Tactics – Local Impact Necessary items for your “journey” 2

Why is this important Operating costs will need to be reduced by 15 percent to 25 percent to ensure continued viability in the value environment Physicians are a driver of costs and are THE major partner needed to reduce those costs Current alignment activities can prepare Healthsystems to be cost competitive in new models 3

ACHE Focus on Physicians New Physician Executive Forum Physician Leadership “Boot Camp” Pilots Career Development Task Force – Physicians as members New Strategic Plan – Desired Outcomes – Increased membership and participation across the spectrum of healthcare leadership – Higher levels of member engagement and satisfaction – Increased brand awareness and perceived value among members and key constituents – Greater impact in advancing effective and efficient healthcare 4

What has happened in the past with our physician colleagues? BUYING SPREE Not what we expected….loyalty cant be bought? Healthsystem and physician alignment – Co Management – Gainsharing Value Based Collaboration Models 5

VARIETY OF ALIGNMENT MODELS AND PREPARATION TACTICS 6

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8 Building a Successful Physician Alignment Strategy Source: Healthcare Strategy Group Mutual Success Clinical Integration Building Common Vision and Culture Physician Employment Strategy Economic Alignment Options Medical Staff Growth and Development Physician Manpower Planning Strategy Planning Alignment Integration

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Focus Areas for Alignment Activities Volume Based Care – Focused on Employment – Fixed Compensation – Committee Service Compensation – Defend Market – Competitive Advantage with subspecialists Value Based Care – Promotes Integration and alignment of incentives – Focus on quality across continuum – Need for common IT platforms – Preparation for Bundled Payments and ACO’s 10

What are key Physician/Healthsystem Collaboration Forces Now? Pay for performance reimbursement approaches Regulatory requirements are increasing Migration of physicians from inpatient to outpatient settings (loss of connection) Need to recruit additional physicians places a risk on existing physicians Newer physicians want predictable hours and an income guarantee Practice expense stress financial viability of independent practices Large employers and Medicare are moving to bundled payments, single price contracting, and pay-for-performance Long-term success of the healthcare system Source: Nick Fabrizio, PhD, FACMPE, FACHE, MGMA consultant 11

LOCAL IMPACTS – COOPER EXPERIENCE 12

13 Employees 4,666 full-time, 1,337 part-time 6,003 Patient encounters1.3M+ Admissions26,624 ED visits81,075 Outpatient visits1.2M Medical Staff1,004 Employed physicians541 Community physicians266 Allied Health professionals197 Residents and Fellows313 Licensed beds Includes 35 NICU and Transitional Newborn Bassinets 635 Cooper Fast Facts

Cooper Medical School of Rowan University Opened in 2012 on the Health Sciences Campus in Camden, New Jersey. The first new medical school in New Jersey in over 35 years and the only four- year MD-granting medical school in South Jersey. CMSRU has quickly become a sought after medical school in the country because of its focus on community. 14 CMSRU addresses the physician shortage locally and nationally, and its students and faculty continually work to find innovative improvements to health care throughout the region.

15 The need to meet our academic mission remains while we strive to address the triple aim High competition for fixed population Amidst a cultural shift The Delaware River Partnerships beyond M&A Industry is in flux Academic mission: Education & research QUALITY Improve the health of the population COST Reduce the cost of care per capita SERVICE Enhance the patient experience Triple Aim 12 3

16 Academic Medical Centers like Cooper walk a fine line to strike a balance between volume and value The Balancing Act COMMODITIZED CAREDESTINATION CARE VOLUME (Old Order)VALUE (New Order) Health system business models focused on high margin, high- tech inpatient care Fee-for-service payment for activity volume and “carve outs” Advanced subspecialty care for the complications of advanced disease Specialty focus on care innovation Health system business models focused on quality and efficiency of care management across the full continuum Bundled/global payments and incentives for outcomes Proactive health management Innovation around process integration across providers Product & Services Differentiation Operational Efficiency Customer Service

17 Health System Trends: Volume to Value Timing Matters PrematureWell-TimedLagging Contracts before sufficient capabilities to be successful on new arrangements Transition contracts strategically while building capabilities. Delay building capabilities and focus on fee for service – and risk being caught unprepared Capabilities for Value-Based Care Value-Based Contracts

18 Cooper aims to be the partner of choice Making Cooper the partner of choice…. …allows us to pursue a range of collaboration options Cost Advantage Efficient Product Quality Outcomes Payor Contracts Tertiary Care Capabilities Service excellence 1. Clinical affiliation 2. Regional collaborative 3. Accountable Care Organization 4. Clinically integrated network 5. Merger or acquisition Risks and rewards

19 i Only Academic Med Ctr (AMC) in South NJ Programs of Distinction Supportive partnership position Building relationships with community hospitals Expense reduction Improved quality Transforming the culture Focus on quality and access Cost advantage among peers Payor contracts Shifting improvement focus to Ambulatory COMMODITIZED CARE Product & Services Differentiation Operational Efficiency Service Excellence DESTINATION CARE The Balancing Act Cooper continues to position itself for the future

Checklist for Necessary Physician Alignment Items  Map  Menu  Stopwatch  “Spidy Sense”  Team  Catcher  Yoga Mat  Watering Can 20

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THANK YOU! 30