Health Care Homes and Payment Reform Ross Owen, M.P.A. BHCAG Workshop 6/21/12

Multi-Payer Investment in Primary Care Transformation SOURCE: Adapted from MDH Health Economics Program, Medicare enrollment data and SEGIP enrollment data

Payment Approaches to Support the HCH Fee-for- Service Fee-for-Service + Budget-Neutral HCH Payment Shared Savings Shared Savings and Shared Losses Global Payment Reimbursement Models Provider Economic Incentives Deliver More Care Reduce Costs, Improve Quality Outcomes and Experience “Accountable Care/Total Cost of Care”

HCH Payment Within Accountable Care Public purchaser ACO models embed HCH payment within calculated costs ◦ Medicare Shared Savings Program ◦ Pioneer ACO ◦ MN Medicaid Health Care Delivery Systems Demonstration Core HCH elements considered foundational to ACO definitions ◦ NCQA ACO accreditation criteria ◦ Primary care as the locus of patient attribution

Primary Care is the Foundation of Accountable Care Miller, Harold. Center for Healthcare Quality and Payment Reform:

Value to Purchasers Public budgets assume neutrality for direct HCH payments: “no new money” A ready-made “blue ribbon” designating advanced primary care models in your backyard ◦ Selective Contracting ◦ Tiered Networks ◦ Direct Financial Support for non-Visit Based Care Evidence that care coordination is most effective the closer it is to the setting of care More work to do to demonstrate both short- and long- term return on investment (ROI) for commercially- insured

Changing Role of Purchasers Increasingly active role in designing and influencing provider reimbursement models Comparing value of available coordination/support services Aligning incentives for patients and providers with the desired outcomes (e.g. deductibles)

QUESTIONS?