1. Improving Care for the Chronically Ill Linda Magno Director, Medicare Demonstrations

2. Medicare Spending for Beneficiaries’ with Chronic Conditions The 20 percent of beneficiaries with 5+ chronic conditions incur 66 percent of Medicare spending Source: Partnership for Solutions

3. Concentration of Medicare Expenditures Source: CMS, Office of Research, Development, and Information

4. Improvement Opportunities Significant gaps in care Significant gaps in care Recent studies show Recent studies show 73% seniors receive appropriate care73% seniors receive appropriate care Between 51% and 59% of adults receive recommended careBetween 51% and 59% of adults receive recommended care Opportunities for providing the right care at the right time in the right place Opportunities for providing the right care at the right time in the right place

5. The Healthcare Delivery System Acute care focused Acute care focused Fragmented Fragmented Modeled on medical management Modeled on medical management Lacking self-managementLacking self-management Reactive system Reactive system Challenge is to be proactiveChallenge is to be proactive

6. Fragmentation of Care Chronic care failings widespread Chronic care failings widespread Fragmentation is a serious problem Fragmentation is a serious problem On average, Medicare beneficiaries see 6.4 MDs and fill 20 prescriptions annuallyOn average, Medicare beneficiaries see 6.4 MDs and fill 20 prescriptions annually Beneficiaries with 5+ chronic conditions see 14 MDs and fill 57 prescriptions annuallyBeneficiaries with 5+ chronic conditions see 14 MDs and fill 57 prescriptions annually

7. Evolution of CMS Initiatives Enrollment models Coordinated care – 2002 Coordinated care – 2002 Sites not at riskSites not at risk Disease management w/ Rx drug benefit –2003 Disease management w/ Rx drug benefit –2003 Organizations at full risk for guaranteed savingsOrganizations at full risk for guaranteed savings

8. Evolution (cont’d.) Population models LifeMasters disease management – 2004 LifeMasters disease management – 2004 Population-based focusing on dual eligibles (up to 30,000 participants)Population-based focusing on dual eligibles (up to 30,000 participants) Fee risk and shared savingsFee risk and shared savings Medicare Health Support – 2005 Medicare Health Support – 2005 Population-based, fee risk for guaranteed savingsPopulation-based, fee risk for guaranteed savings

9. MHS Implementation Phase I 8 pilot programs 8 pilot programs Randomized control trial: 20,000 beneficiaries in treatment, 10,000 in control group, per site Randomized control trial: 20,000 beneficiaries in treatment, 10,000 in control group, per site Phase II Evaluation outcomes drive expansion Evaluation outcomes drive expansion Savings targets, clinical quality metrics, beneficiary satisfactionSavings targets, clinical quality metrics, beneficiary satisfaction Expansion could follow in 2-3.5 years Expansion could follow in 2-3.5 years

10. MHS Key Features Pilot programs Pilot programs 24/7 personalized support for chronically ill beneficiaries 24/7 personalized support for chronically ill beneficiaries Voluntary participation Voluntary participation Free of charge Free of charge No change in plans, benefits, choice of providers or claims payment No change in plans, benefits, choice of providers or claims payment Holistic approach Holistic approach

11. Locations of MHS Programs LifeMasters McKesson Health Dialog Healthways Aetna CIGNA XL Health Green Ribbon Health SM

12. Shifting Focus Increasing scale of projects Increasing scale of projects Changing financial risk to vendors or providers Changing financial risk to vendors or providers Withholds, savings guaranteesWithholds, savings guarantees Opt-out versus opt-in enrollment Opt-out versus opt-in enrollment Nature of physician involvement Nature of physician involvement

13. Where Are We Now? Fundamental intervention is same: coordinated care = disease management = chronic care improvement Fundamental intervention is same: coordinated care = disease management = chronic care improvement Jury is still out in terms of results Jury is still out in terms of results Band-aids on a broken system Band-aids on a broken system

14. The Healthcare Delivery System Still: Acute care focused Acute care focused Fragmented Fragmented Modeled on medical management Modeled on medical management Reactive system Reactive system

15. So How Do We Change the System?

16. Where Are We Going? Medicare Advantage Special Needs Plans Medicare Advantage Special Needs Plans Chronically ill or othersChronically ill or others ESRD disease management ESRD disease management Managed care option w/ quality withholdManaged care option w/ quality withhold

17. Value-Based Purchasing Strategies System efficiencies across providers System efficiencies across providers Care coordinationCare coordination Managing transitions across settingsManaging transitions across settings Shared clinical information Shared clinical information Reduce duplicative tests and proceduresReduce duplicative tests and procedures Improve processes and outcomes Improve processes and outcomes Increase guideline complianceIncrease guideline compliance

18. Value-Based Purchasing Strategies Patient education Patient education Self-care supportSelf-care support Reduce avoidable hospital admissions, re-admissions, emergency room visits Reduce avoidable hospital admissions, re-admissions, emergency room visits Substitute outpatient for inpatient services Substitute outpatient for inpatient services Less invasive procedures for more invasive proceduresLess invasive procedures for more invasive procedures Reduce lengths of stay Reduce lengths of stay

19. Where Are We Going in FFS? Physician group practice Physician group practice FFS payment + shared savings/performance bonusFFS payment + shared savings/performance bonus Business risk only Business risk only Care management for high-cost beneficiaries Care management for high-cost beneficiaries Provider-driven alternative to MHSProvider-driven alternative to MHS

20. Physician Group Practice Demonstration Overview Medicare FFS payments Medicare FFS payments Performance payments derived from practice efficiency & improved patient management (shared savings) Performance payments derived from practice efficiency & improved patient management (shared savings) Financial PerformanceFinancial Performance Quality PerformanceQuality Performance Budget neutral Budget neutral

21. Physician Group Practice: Goals & Objectives Encourage coordination of Medicare Part A & Part B services Encourage coordination of Medicare Part A & Part B services Promote efficiency thru investment in infrastructure and care processes Promote efficiency thru investment in infrastructure and care processes Reward physicians for improving efficiency, quality and outcomes Reward physicians for improving efficiency, quality and outcomes

22. Physician Group Practice: Process & Outcome Measures Congestive heart failure Congestive heart failure Coronary artery disease Coronary artery disease Diabetes mellitus Diabetes mellitus Hypertension Hypertension Cancer screening Cancer screening

23. Physician Group Practice Models & Strategies Care management Care management Disease management & case management strategiesDisease management & case management strategies Managing care across transitionsManaging care across transitions Increased access – nurse call lines, primary care physicians, geriatricians Increased access – nurse call lines, primary care physicians, geriatricians Enhanced patient monitoring through EMRs, disease registries Enhanced patient monitoring through EMRs, disease registries Increase quality through evidence-based guidelines Increase quality through evidence-based guidelines

24. High Cost Beneficiaries Demo Goal: Test ability of direct-care provider models to coordinate care for high-cost/high-risk beneficiaries in traditional (“original”) fee-for- service Medicare by providing support to manage their chronic conditions and enjoy a better quality of life

25. Demonstration Strategies Physician and nurse home visits Physician and nurse home visits Use of in-home monitoring devices Use of in-home monitoring devices Electronic medical records Electronic medical records Self-care, caregiver support, education Self-care, caregiver support, education 24-hour nurse telephone lines 24-hour nurse telephone lines Behavioral health management Behavioral health management Transportation services Transportation services

26. Under Development Medicare care management performance Medicare care management performance Physician practice-based care managementPhysician practice-based care management Incentives for health IT adoption and use Incentives for health IT adoption and use Medicare health care quality Medicare health care quality Restructured delivery system and integration of health ITRestructured delivery system and integration of health IT

27. Medicare Care Management Performance Demonstration MMA Section 649 MMA Section 649 Goals: Goals: Improve quality and coordination of care for chronically ill Medicare FFS beneficiariesImprove quality and coordination of care for chronically ill Medicare FFS beneficiaries Promote adoption and use of information technology by small to medium-sized physician practicesPromote adoption and use of information technology by small to medium-sized physician practices

28. Medicare Care Management Performance Demonstration Pay for performance for MDs who: Pay for performance for MDs who: Achieve quality benchmarks for chronically ill Medicare beneficiariesAchieve quality benchmarks for chronically ill Medicare beneficiaries Adopt and implement health information technology, use it to report quality measures electronicallyAdopt and implement health information technology, use it to report quality measures electronically Budget neutral Budget neutral

29. Medicare Care Management Performance Demonstration ~ 800 practices participating in four states ~ 800 practices participating in four states ArkansasArkansas CaliforniaCalifornia MassachusettsMassachusetts UtahUtah Technical assistance to physician practices by quality improvement organizations Technical assistance to physician practices by quality improvement organizations

30. Quality & Outcome Measures: Examples Diabetes mellitus – HgA1c, blood pressure, lipids Diabetes mellitus – HgA1c, blood pressure, lipids Congestive heart failure – left ventricular function, ACE inhibitor, beta blocker Congestive heart failure – left ventricular function, ACE inhibitor, beta blocker Coronary artery disease – LDL cholesterol, antiplatelet therapy Coronary artery disease – LDL cholesterol, antiplatelet therapy Prevention – mammogram, flu vaccine, pneumonia vaccine Prevention – mammogram, flu vaccine, pneumonia vaccine

31. Medicare Health Care Quality (MHCQ) Demonstration “… demonstration projects that examine health deliver factors that encourage the delivery of improved quality in patient care, including— (1) incentives to improve the safety of care; (2) appropriate use of best practice guidelines by providers and services by beneficiaries; (3) reduced scientific uncertainty through examination of variations in the utilization and allocation of services, and outcomes measurement and research;

32. Medicare Health Care Quality (MHCQ) Demonstration (4) shared decision making between providers and patients; (5) provision of incentives for improving the quality and safety and achieving efficient allocation of resources; (6) appropriate use of culturally and ethnically sensitive health care delivery; and (7) financial effects on the health care marketplace of altering incentives delivery and changing the allocation of resources.”

33. Medicare Health Care Quality (MHCQ) Demonstration System redesign System redesign Payment models incorporating incentives to improve quality and safety of care and efficiency Payment models incorporating incentives to improve quality and safety of care and efficiency Best practice guidelinesBest practice guidelines Reduced scientific uncertaintyReduced scientific uncertainty Shared decision makingShared decision making Cultural competenceCultural competence

34. MHCQ System Redesign Hardwire quality into delivery system Hardwire quality into delivery system Make it easy to do the right thingMake it easy to do the right thing Institute of Medicine aims for improvement Institute of Medicine aims for improvement Safety, timeliness, effectiveness, efficiency, equity, patient-centerednessSafety, timeliness, effectiveness, efficiency, equity, patient-centeredness Integrate health information technology Integrate health information technology Inform practice, connect cliniciansInform practice, connect clinicians

35. For More Information www.cms.hhs.gov/DemoProjectsEval Rpts/MD/list.asp#TopOfPage www.cms.hhs.gov/DemoProjectsEval Rpts/MD/list.asp#TopOfPage www.cms.hhs.gov/DemoProjectsEval Rpts/MD/list.asp#TopOfPage www.cms.hhs.gov/DemoProjectsEval Rpts/MD/list.asp#TopOfPage www.cms.hhs.gov/CCIP www.cms.hhs.gov/CCIP www.cms.hhs.gov/CCIP