1. Women in Healthcare lead # like a Girl HFMA Wisconsin November 14, 2014 Presented by Donna Katen-Bahensky Perspectives on the Wisconsin Healthcare Market About HFMA 1

2. Objectives Focus on the Wisconsin Healthcare Environment and will include: Similarities and Unique features Changes occurring in the Market Challenges and Opportunities Critical Stakeholders Necessary when Setting Strategies 2

3. Wisconsin Health Care Market Hospitals in WI GMS 129 Psych 10 LTAC 6 Rehab 2 State MHI 2 AODA 1 3

4. Wisconsin Health Care Markets 4

5. Changing Health Care Environment Hospitals and systems across the country are experiencing the following changes: Migration of Payment to Value-Based Approaches Inpatient Use Rates Declining and Outpatient Rates Likely to Decline Emphasis on Volume and Rates Becoming too Risky Requirement for all health care leaders and organizations to develop a New Set of Core Competencies 5

6. Changing Health Care Environment Hospitals and Systems across the Country Experiencing the Following Changes: Providers consolidating at an accelerated pace Competition being reshaped by EXISTING and NEW competitors Emphasis on Improving Quality and Efficiency Providers determining a Strategy for their future participation Source: Health Research and Educational Trust and Kaufman, Hall and Associates June, 2014 6

7. Health Care Transformation 7

8. Evolution of Strategies Today’s Strategy = Cost Cutting Strategy for Next 3 years = Value and Outcomes Factors placing the most pressure on hospitals today are: Cost Cutting 44% Cost of Upgrading or maintaining IT Systems 41% High-end medical technology costs 37% Rising Drug Costs 33% Imaging Costs 22% Healthcare Reform Initiatives 21% Factors driving strategy for the next 3 years are: Cost Cutting 37% Cost of Upgrading or maintaining IT Systems 40% High end medical technology costs 38% Rising Drug Costs 27% Imaging Costs 12% Healthcare Reform initiatives 34% Source: Ernst & Young’s 2014 Report “Pulse of the industry: Differentiating Differently”, Oct, 2014. 8

9. Healthcare Reform Initiatives Require Changes in Strategies Patient and Family Engagement Primary Care as the Foundation for Care Caring for Chronic Conditions Response to Changing Demographics Use of Telemedicine and other Technologies 9

10. Other Provider Strategies Mergers, Acquisitions and Partnerships Commitment of Resources for Mental Health Significantly Reduced Costs to the System = Ensured future for Medicare and Medicaid Increased Transparency 10

11. More Provider Strategies Electronic Health Record and Sharing of Care Data Population Management Palliative Medicine and End of Life Care Coordinated and Team-Based Care Meet Future Health Care Workforce Needs 11

12. Wisconsin Providers Are Making Positive Changes Examples of Positive Changes being made in Wisconsin Quality Improvement Ranked 3 rd in the Country for Quality Five Wisconsin Health Plans ranked in the Top 50 for Quality Lower Costs Bottom Quartile in Average Hospital Spending Per Patient Systems whose costs have only increased 37% in the last decade Ability to Assume Risk Madison Providers accepting Capitated payments for over two decades Shared Savings ACOs Programs to Increase Health Care Professionals Medical School/Nursing School/Pharmacy Enrollment Other Health Care Professional Schools being Planned 12

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14. Positive Changes Being made in Wisconsin Population Health Management Statewide database documenting health care needs Two academic medical centers with expertise Low Percentage of Uninsured Sixth lowest percentage of uninsured individuals in 2013 in the nation and third lowest in the upper Midwest Increasing Transparency One of the first states to offer consumers online price information (PricePoint) Wisconsin Collaborative for Healthcare Quality (WCHQ) since 2003) Formation of ACOs and Networks Multiple ACOs and increasing number of Networks One Shared Savings ACO generated savings of $17.7 million Electronic Health Records Large percentage of hospitals -Epic EHR 14

15. Further Positive Changes in Wisconsin Value Based Purchasing Numerous Experiments being implemented Alliance and QualityPath Hospitals Use of Lean Management Theda Care the state’s early leader but many utilizing Lean tools End of Life Care LaCrosse known nationally for community wide inititaive Honoring Choices – Wisconsin Medical Society Improving Mental Health Services Multiple communities working together Moving Mental Health Care into Primary Care 15

16. Strategies with Unknown/Neutral Impact Out of State Systems Moving into the State Use of Telemedicine and No Reimbursement Formation of Multi-Health System Networks Provider Based HMOs and Large Commercial Insurers Large number of independent Hospitals Purchasing physician practices 16

17. Strategic Opportunities for Wisconsin Expansion of Medicaid Reducing Racial and Ethnic Disparities Fill the Gaps in Mental Health Services Reduce Projected Shortages of Health Care Workforce Utilize the skills of all in Interdisciplinary Team Increase Standardization of Practice/Rationalization of Care Use of Telemedicine Two Medical Schools with Strong Research Programs 17

18. Challenges for Wisconsin Need to address lack of continuity and coordination Large Percentage of Population over age 65 and 85 Silos that exist across all the Hospitals and Systems Uneven distribution of Primary Care providers Lack of public awareness and understanding of how to access and move through the system Projected Inadequate Number of Health Care Providers 18

19. Challenges for Wisconsin Tremendous Geographic Differences/Distance Inconsistent Practices Across the State Ability to Take Risk Varies Across Systems Largely Fee for Service –historically positive contracts Success largely based on Competition and Market Dominance Costs already Relatively low Rural Communities and Mental Health Care Needs 19

20. Community Solutions will Require a New Approach Success will only be possible if all critical stakeholders are involved in designing and implementing strategies Patients and Families Community Leaders/Agencies/Non-Profits Physicians, Both Primary Care and specialty Nurses/Nurse Practioners Finance Information Technology Case Managers 20

21. Other Critical Stakeholders There are other critical stakeholders that must be part of setting and implementing strategies: Marketing Social Media specialists Industrial Engineers Schools/Colleges/Universities Local political leaders/City Planners 21

22. How do You Get Involved? Constantly Watch for Opportunities Look for Signals in the External Environment Approach the design of Strategies like a Marketer Think Outside the Box Use the Community Needs Assessment to Focus Initiatives Consider Partners to take advantage of Opportunities Ask to be at the Table and then Show Your Worth Bring the Patient and Family Perspective 22

23. “Engaging patients, families and communities has the potential to be a “game changer” in the transformation of the health care system in the United States”. American Hospital Association, 2013 23

24. Action Steps 24 Learn about what is going on in the State of Wisconsin Learn what is going on in other states Make connections with others and learn from them Innovate in your own organization Remember this is a time to experiment Share Best Practices Remember we are all in this together WE CAN IMPROVE HEALTH CARE!

25. Thank you from Wisconsin! Any Questions? 25