1. November 14-15, 2005 Montpelier, VT Chronic Care Management: Options for Vermont Kenneth E. Thorpe, Ph.D. Robert W. Woodruff Professor and Chair Department of Health Policy and Management Rollins School of Public Health Emory University kthorpe@sph.emory.edu

2. November 14-15, 2005 Montpelier, VT Key Facts Cost of treating chronically ill patients accounts for 75% of health spending in Vermont (over $3 Billion per year) Rise in chronic illnesses and obesity key factors in driving growth in spending Chronically ill patients receive about 50% of the clinically recommended care The IOM and others have highlighted the need to dramatically restructure how we deliver services –Patient focused/central –integrated multi-disciplinary approach –Proactive not reactive model

3. November 14-15, 2005 Montpelier, VT Chronic Care Model (CCM): 1.Does It Work? Yes. Interventions that contain 1 or more elements of the chronic care model improve clinical outcomes and processes and to lesser extent quality of life according to RAND findings. 2. Implementation Challenges Facing The State: Can Vermont Build the CCM? Change how Medicaid pays for carekey challenge for existing Blueprint.

4. November 14-15, 2005 Montpelier, VT Disease States Commonly Targeted by DM Industry CHF, Cardiovascular disease Asthma Chronic Obstructive Pulmonary Disease (COPD) Diabetes Cancer Maternal/Neonatal Rare Diseases ESRD

5. November 14-15, 2005 Montpelier, VT Components of DM Products Population Screening Using claims/clinical data to identify patients for disease management Patient Risk Management Surveying patients about disease status/burden to identify for disease management Team-Based Care Using formalized teams to increase collaboration of care Alternative Encounters Providing opportunities outside of the face-to- face encounter for relationship Cross-Consortium Coordination Managing across sites and settings to improve care continuity Patient Education Teaching patients about their disease Outreach/Case Management Tracking patients and their status proactively Decision Support At the Point of Care Translating disease management guidelines to patients-specific recommendations for clinicians. Guidelines/Protocol Providing information to clinicians on recommended clinical management Performance Feedback Measuring performance in delivering desired care and achieving improved outcomes

6. November 14-15, 2005 Montpelier, VT Full Integration: Population Based and Chronic Care Case Based Model Lifestyle interventions Low riskAt risk Disease Management DiseaseSymptomsEarly Signs Preventive ServicesCase Management Screening Primary and Secondary Prevention Acute treatment Disease Management HEALTH IMPROVEMENT DISEASE MANAGEMENT HEALTH MANAGEMENT POPULATION-BASEDCASE-BASED

7. November 14-15, 2005 Montpelier, VT Disease Management Targets for Vermont Medicaid, could be effective approach for managing global commitment State employees Dual eligible (Medicaid/Medicare) Commercial market

8. November 14-15, 2005 Montpelier, VT Managed Care Organizations (MCOs) Play Key Role In Medicaid DM Nationally Some MCOs manage directly, others outsource and pay vendors on performance (e.g. % reduction in hemoglobin A/C levels among diabetics, % reduction in hospital days among asthmatics) Disease states typically targeted in Medicaid –depression- anxiety disorders –psychosis - diabetes –hypertension - asthma –CHF, CVD

9. November 14-15, 2005 Montpelier, VT Other states are implementing disease management programs to provide beneficiaries with higher quality care at a lower cost Florida – runs in AIDS, Congestive Heart Failure (CHF), End Stage Renal Disease (ESRD), diabetes, hemophilia and asthma. Five of these programs reported successful results Washington state runs programs in ESRD, diabetes, asthma and CHF and has also published favorable results. Montana started recently with five common chronic diseases and a highly popular nurse call in line to help beneficiaries coordinate care. Indiana is building its own program rather than outsourcing to disease management vendors. Wyoming, Texas, New Hampshire, Georgia, Tennessee, and South Carolina are in various stages of RFPs with disease management vendors and will likely begin operations soon.

10. November 14-15, 2005 Montpelier, VT Selected Examples of DM in Medicaid FFS State DM Program Focus Years in Operation FloridaAsthma, CHF, HIV/AIDS, Hemophilia, ESRD, Diabetes, Hypertension, Depression 1998-present MississippiAsthma, Diabetes, Hyperlipidemia, Coagulation Disorders 1998 – present North Carolina Asthma, Diabetes, LTC Polypharmacy1998 – present VirginiaAsthma, Diabetes, Ulcers, GERD, CHF, COPD Asthma Pilot; 1995- 1997; All Others: 1997-present WashingtonAsthma, CHF, Diabetes, ESRD, Other High Cost Patient Populations 2002-present

11. November 14-15, 2005 Montpelier, VT DM Contracting Examples Washington - full risk –80% payment at risk based on projected savings –20% payment at risk based on performance/quality –Has been effective in Washington Financial and clinical goals need to be clear Need methodology for program evaluation

12. November 14-15, 2005 Montpelier, VT Based on other states experience and vendor guarantees, significant savings can be achieved, e.g., Disabled and Blind – 4% Aged – Community & Custodial Care –Acute Care Medical – 25% –Drugs – 10% –Aged in Skilled Nursing – 20% –TANF – Neonates – 6% –ESRD – 8% Contracts typically include performance guarantees. States typically pay base administrative fees to DSM vendors. At the end of the reporting period (Usually a Fiscal year), savings are measured. If the net savings guarantee is not met, the vendor will reimburse the state up to 100% of their administrative fees. SOURCE: COMPUTER SCIENCES CORPORATION

13. November 14-15, 2005 Montpelier, VT Vermont can expect challenges to implementing these programs Need continuous enrollment (at least 12 monthly enrollment by Medicaid / SCHIP) populations Need to define business model: –Per member, per month adjusted for risk (i.e. Medicare Advantage Methods). –Contracts with physician groups based in cost savings / quality / clinical measures

14. November 14-15, 2005 Montpelier, VT Inside the Black Box: Key Implementation Issues 1.How to identify candidates Registry Claims data Physician referral 2. How to enroll beneficiaries opt-in (low enrollment 30%) engagement or opt-out model (are enrolled unless they decline – up to 95% participation)

15. November 14-15, 2005 Montpelier, VT Inside the Black Box: Key Implementation Issues 3.How to pay for DM – Perhaps the Key Issue Full insurance risk (PMPM risk adjusted payment using Medicare Advantage Model) P4P – Performance Risk Define evidence based guidelines

16. November 14-15, 2005 Montpelier, VT Inside the Black Box: Key Implementation Issues P4P (continued) –Bonus pool distribution at practical network level based on HEDIS measures(50% weight) Patient satisfaction(30% weight) IT investment(20% weight)