2. Consumers Have Spoken 1. 1. Job Creation 2. 2. The National Debt 3. 3. Healthcare Costs

3. Objectives Discuss the research findings on the major forces that continue to drive up healthcare cost in the USA. Discuss the 3 major models for reducing cost. Discuss the impact on the OR Director as the driver for change.

4. Medicare Reimbursement- 2012 State Exchanges- Medicare-Commercial- 2013-2014 15-20 %

5. We pay our doctors, hospitals, and other medical providers in ways that reward doing more, rather than being efficient and improving outcomes. How do you think things will change in 2014 when fee for value contracts start replacing fee for service contracts? #1

6. We are growing older, sicker, and fatter. What role ( if any ) do you think hospitals and doctors should or could play in reversing the obesity trends? What do you predict in ACO models? #2

8. We want new drugs, technologies, services, and procedures. How do you think this will change when people begin to request insurance that covers them in an ACO versus a fee for service contract? #3

10. We get tax breaks on buying health insurance…and the cost to patients of seeking care is often low. What do you think will be the impact of benefit programs moving toward high deductable coverage on your surgical volume? Is this a good thing or a bad thing in your opinion? #4

13. $51,413.00 Dec. 2011 Real median household income is 7% lower than it was in Dec. of 2007 and 3% lower than in June of 2009

14. For families with a $4000- $5000 deductible it may feel to them as if they have no insurance at all!

15. We don’t have enough information to make decisions on which medical care is best for us. Do you think “end of life” interventions will change much over the next few years under the ACO model? #5

16. Our hospitals and other providers are increasingly gaining market share and are better able to demand high prices. What type of consolidation is going on in your marketplace? Do you agree or disagree that allowing near monopolies will drive up prices? #6

17. We have supply and demand problems, and legal issues that complicate efforts to slow spending. Malpractice premiums and jury awards are part of what drives spending…also some state laws limit the ability of nurse practitioners or other medical professionals to fully perform…also too many specialist and not enough primary doctors…do you see this changing in ACO’s? #7

18. Cost drivers Incentives….we all make more $$$ in a fee for service world. We are getting fatter, sicker, and older. We want the latest technology End of life care Legal system Too big and you can set prices We lack good tools for decision making.

19. Medicare Reimbursement- 2012 State Exchanges- Medicare-Commercial- 2013-2014 15-20 %

23. Shopping Carefully for High-Cost Acute Care Services 23 Walmart Steering Employees to Preferred Providers for Surgical Care Source: “Walmart Expands Health Benefits to Cover Heart and Spine Surgeries at No Cost to Associates,” Walmart News, October 12, 2012, available at: http://news.walmart.com; Health Care Advisory Board interviews and analysis. Case in Brief: Walmart Centers of Excellence Walmart entered into bundled payment agreements with six health systems covering heart, spine, and transplant surgeries Program launched in January 2013; includes 1.1 million covered lives Providers selected based on convenience, quality, and potential for cost savings Walmart Centers of Excellence Partners Cleveland Clinic Geisinger Medical Center Mayo Clinic Mercy Hospital Springfield Scott & White Memorial Hospital Virginia Mason Medical Center

24. OR Director’s Focus Partnering with surgeons, anesthesiologist, and administration to standardize care. Standardizing supplies ( is there clinical evidence to support carrying 5-6 brands for implants? ) Standardizing processes and protocols Reducing waits Demonstrating superior outcomes at a lower cost Set aggressive targets for efficiency Can it be done with less labor?