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ACO Lunch & Learn January 11, 2016

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Page 1: ACO Lunch & Learn

ACO Lunch & LearnJanuary 11, 2016

Page 2: ACO Lunch & Learn

AgendaIntroductions

About Darwin

ACOs & Value-based contracting

Arizona Market

ACO Executive Survey

Trending from our IDN and ACO research

Page 3: ACO Lunch & Learn

Project Background and GoalsMulti-client, ongoing study of ACOs

Personal interviews

Inform clients’ organized customer strategy

Identify partnering opportunities

Understandning consequential market trends

Discover ACOs’ current strategic priorities

Page 4: ACO Lunch & Learn

About DarwinFounded in 2009, we are a research-based management consulting firm with a focus on health care delivery models—physician groups, health systems, and home health—and emerging payer models, like accountable care organizations and bundled payments.

Our clients include pharmaceutical and medical device manufacturers, home health care companies, health systems, venture capital firms, and private equity managers. 

http://www.darwinhealth.net17470 N. Pacesetter Way, Scottsdale, AZ 85255 480.305.2059

Page 5: ACO Lunch & Learn

ACOs Defined

In general, comprised of physician groups, health systems, hospitals, insurers—and any combination of these providers

In most cases, they form a separate LLC

Contract states some form of baseline for quality and budget, set annually

Bonus for beating budget, penalty for exceeding budget

ACOs are NOT managed care, like an HMO

Mission-driven to achieve the Triple Aim

Page 6: ACO Lunch & Learn

Patient Experience Lower Costs

Population Health

Achieving all Three

Improve the health of populations of people

Improve the patient experience with healthcare

Reduce per-capita healthcare costs

The Triple Aim

Page 7: ACO Lunch & Learn

ACO Models

Medicare: Pioneer, Shared Savings Program, Advance Payment, Investment, Next Generation

Commercial

Medicaid

Employer

Specialty

Local Government

Page 8: ACO Lunch & Learn

25 or more

10-24

5-9

1-4

No ACO

D.C.

HI

AK

MSSP ACO Distribution

Page 9: ACO Lunch & Learn

BCBS Affiliates/Anthem UnitedHealthcare Cigna Aetna

Number of ACOs ~ 500 750+ 150 ~ 60

Reach 36 states 48 states 29 states 20 states

Covered Lives 25 million 13 million 1.7 million 4 million

Brand BCBS ACO, Alternative Quality Contract (AQC) Accountable Care Answers Collaborative Accountable

CareAccountable Care Solutions under Aetna Whole Health

Performance

• CALPERS/Hill Physicians/Dignity ACO saved $95 million in 4 years1

• 3.6% reduction in admissions, 9% reduction in inpatient stay (performance-based contracts)

• 1%-6% reduction in costs (ACO)

• Case studies with WestMed and Monarch2

• 82% of mature ACOs (more than 2 years) beat the market in medical cost performance; 75% outperformed the market for quality• 2:1 ROI3

2013: $5M in shared savings with Banner (5% reduction in costs), improved cancer screening, fewer poorly controlled diabetics, 9% reduction in radiology services, 9% reductions in avoidable admissions4

Notes

• Eli Lilly has a major agreement with Anthem HealthCare to share data and improve health outcomes• Anthem has 19 ACOs in

California, rich performance data

• $36B of revenue tied to ACOs, bundled payments and performance-based initiatives; projects $65B by 2018

• Parent owns Optum Health

Pays for care managers to be hired and installed onsite for each of its ACO agreements that coordinate patient care and manage to the ACO contract

• Launched Healthagen, a diversified care management and analytics company

• Humana reported more than 900 agreements in more than 43 states prior to merger announcement5

3 http://www.cigna.com/assets/docs/newsroom/887033-collaborative-care-proofpoints-2014.pdf4 https://news.aetna.com/2014/08/quality-costs-aetna-banner-health-network/

1 https://www.pcpcc.org/initiative/hill-physicians-medical-group-and-bcbs-california-aco2 https://www.uhc.com/valuebasedcare/about-value-based-care/results

5 https://www.humana.com/about/public-policy/humana-improves-healthcare/strengthening-system/accountable-care-incentives

Commercial ACO Activity

Page 10: ACO Lunch & Learn

MSSP ACO Performance, 2013-20152013 2014 2015

Target $42,499,376,827 $52,885,283,825 $73,297,675,699Actual $42,265,781,094 $52,593,805,999 $72,868,421,009Difference $233,595,733 $291,477,826 $429,254,690Percent Difference 0.553% 0.554% 0.589%Total Earned Savings by ACOs $311,922,221 $341,246,303 $645,543,866Savings/Loss to Medicare -$78,326,488 -$49,768,477 -$216,289,176

2013 2014 2015

Beneficiaries 3,675,263 5,329,831 7,270,2332015 Target PB $11,564 $9,923 $10,0822015 Actual PB $11,500 $9,868 $10,023Difference PB $64 $55 $59Earned Savings PB $85 $64 $89Savings/Loss to Medicare PB -$21 -$9 -$30

Performance per Beneficiary

Source: CMS, Darwin Health

Page 11: ACO Lunch & Learn

Extrapolating further, from 2013 to 2014, Medicare

expenditures increased 5.5 percent, from $586.3

billion to $618.7 billion. Had the overall Medicare

program performed like the MSSP ACOs, we

would have saved $129.1 billion during that time

period, rather than spending $32.4 billion more.

Page 12: ACO Lunch & Learn

MSSP Service Area

Accountable Care Coalition of Greater Augusta & Statesboro GA, SC Coastal Medical MA, RI Rio Grande Valley Health Alliance TX Southern Kentucky Health Care Alliance KY Triad HealthCare Network NC Alexian Brothers Accountable Care Organization IL Collaborative Health ACO MA Tidewater Accountable Care Organization VA Reliance ACO MI Billings Clinic MT, WY ProHealth Physicians ACO CT Central Maine ACO ME RGV ACO Health Providers TX Primary Partners FL Integrated Care Alliance FL Physicians Accountable Care of Utah UT Bayview Physicians Group NC, VA

Source: CMS, Darwin Health

2015 Top Performing MSSPs, Quality

Page 13: ACO Lunch & Learn

MSSP Service Area

Shared Savings

Memorial Hermann Accountable Care Organization TX $89,128,773Palm Beach Accountable Care Organization FL $76,642,477Advocate Physician Partners Accountable Care IL $72,667,885Millennium Accountable Care Organization FL $37,105,241Atlantic ACO NJ, PA $35,513,990Cleveland Clinic Medicare ACO OH $33,906,226Hackensack Alliance ACO NJ, NY $33,353,310UT Southwestern Accountable Care Network TX $29,958,600Orange Accountable Care of South Florida FL, TX $28,502,501RGV ACO Health Providers TX $21,613,110West Florida ACO FL $21,388,840Northern Maryland Collaborative Care MD $20,814,181Methodist Alliance for Patients and Physicians TX $18,718,445KentuckyOne Health Partners KY $18,123,932POM ACO MI $17,678,098MyHealth First Network SC $17,295,364Accountable Care Coalition of Southeast Wisconsin WI $17,161,508

Integral Healthcare FL $16,529,392

Source: CMS, Darwin Health

2015 Top Performing MSSPs, Savings

Page 14: ACO Lunch & Learn

Key Takeaways, latest MSSP performance data

204 of 393 (51.9%) had shared savings

120 of 393 (30.5%) earned shared savings

Year-over-year quality improvements

Page 15: ACO Lunch & Learn

Core-Based Statistical Area Est. 2015 Population Hospitals Beds

Phoenix-Mesa-Scottsdale 4,574,531 74 10,509

Tucson 1,010,025 19 3,054

Lake Havasu City-Kingman 204,737 4 597

Prescott 222,255 6 370

Flagstaff 139,097 5 359

Yuma 204,275 2 447

Show Low 108,277 5 176

Sierra Vista-Douglas 126,427 4 160

Payson 53,159 3 72

Safford 37,666 1 49

Nogales 46,461 1 25

Total 6,726,910 124 15,818

Arizona Market

Phoenix (68%)

Tucson (15%)

POPULATION

Page 16: ACO Lunch & Learn

Organization HQ Service Area

Medicare Beneficiaries

Shared Savings (Losses)

Shared Savings

(Losses) PMB

Abacus Health Tucson AZ 8,559

Arizona Care Network Phoenix AZ 29,380 ($6,125,069) -$208.48

Arizona Connected Care Tucson AZ 6,956 $4,858,147 $698.41

ASPA Connected Community Phoenix AZ, NM 4,676 $409,156 $87.50

Banner Health Phoenix AZ 59,298 $35,113,328 $592.15

Commonwealth Primary Care ACO Tempe AZ 46,120 $15,553,674 $337.24

John C. Lincoln Accountable Care Organization Phoenix AZ 15,544 ($17,482,058) -$1,124.68

North Central Arizona Accountable Care Prescott AZ 11,592 ($1,263,357) -$108.99

Optum ACO Phoenix AZ 37,000

Premier Care Network Las Vegas, NV

AZ, CA, NV 8,835 ($6,277,168) -$710.49

Revere Health (Previously Central Utah Clinic) Provo, UT AZ, NV, UT 15,909 $13,911,028 $874.41

Scottsdale Health Partners Scottsdale AZ 19,021 $9,943,847 $522.78

Arizona Medicare ACOs

Page 17: ACO Lunch & Learn

Organization Primary Market Estimated Lives

Aetna - Arizona Care Network ACO Phoenix

Aetna - Banner Health ACO Gilbert 50,000

Banner Health Network - Health Net of Arizona ACO Phoenix 24,000BlueCross BlueShield of Arizona - Banner Health ACO Phoenix 23,000Cigna - Arizona Community Physicians ACO Tucson 6,000Cigna - Arizona Connected Care ACO Tucson 6,000

Cigna - Banner Health Network ACO Phoenix 20,000

Cigna - Cigna Medical Group Phoenix 15,000

Cigna - Commonwealth ACO Phoenix 7,500

Cigna - Scottsdale Health Partners ACO Scottsdale 4,000Health Choice - Abrazo Community Health Network - Phoenix Childrens Care Network CIO Phoenix 15,000

UnitedHealthcare - Arizona Care Network LLC ACO Phoenix 15,000UnitedHealthcare - Arizona Connected Care ACO Tucson 180,000

UnitedHealthcare - Banner Health Network ACO Phoenix 50,000

UnitedHealthcare - Commonwealth Primary Care ACO Tempe <10,000

Arizona Commercial ACOs

Page 18: ACO Lunch & Learn

John C. Lincoln

North Centra

l AZ

Premier Care Netw

ork

Commonwealth

ASPA-Connected

Arizona Coordinated Care

ACN

Patient/Caregiver ExperienceACO-1 Timely care, appointments and information 172.26%-26.22%-97.37%-528.03%-503.06%-1099.74%-515.54%-475.60%-435.65%ACO-2 Provider communication -46.10%37.23%-132.68%-55.84%-1.73%-431.36%-248.47%-145.66%-124.02%ACO-3 Patients’ rating of provider -21.90%-38.26%-101.51%-217.12%98.07%-501.77%-324.00%-225.84%-235.66%ACO-4 Access to specialists -267.73%-361.15%-219.83%-393.49%-110.84%-476.13%-332.41%256.85%-224.62%ACO-5 Health promotion and education 567.06%-372.31%-316.35%-545.26%438.20%-574.08%-514.74%-1286.24%-541.87%ACO-6 Shared decision making 567.63%535.55%504.80%75.68%313.64%-118.16%-8.54%340.37%-222.43%ACO-7 Health status/functional status 28.16%214.48%75.43%-56.66%69.87%598.26%-70.57%-401.50%60.14%ACO-34 Stewardship of patient resources -3071.15%-632.34%398.76%-222.82%1225.10%-2120.49%-226.48%1455.46%354.88%Care Coordination / Patient SafetyACO-8^ Risk standardized, all-condition readmissions -86.63%135.46%-591.39%-584.66%209.49%-941.35%741.16%-1049.03%88.35%ACO-35^ Skilled Nursing Facility 30-day all-cause readmission measure -446.48%389.80%-413.25%-346.79%567.02%-474.17%1901.75%-956.00%-36.65%ACO-36^ All-cause unplanned admissions for patients with diabetes -6219.67%-2260.17%794.34%-1842.40%-2174.05%-48.53%-2939.97%1138.83%-2271.17%471.85%ACO-37^ All-cause unplanned admissions for patients with heart failure -6219.67%-1409.68%-561.17%-1668.26%-2832.52%198.98%-2822.12%1050.08%-3458.83%484.84%ACO-38^ All-cause unplanned admissions for patients with multiple chronic conditions -6219.67%-2161.35%-206.46%-1624.15%-2736.69%-686.44%-3369.25%863.17%-2665.17%743.97%ACO-9^ COPD or asthma in older adults admissions -4947.76%-4947.76%-1068.35%-4496.66%-5128.19%-3414.04%-6391.25%555.58%-5398.85%-2602.07%ACO-10^ Heart failure admissions -602.51%-410.72%-2040.90%-2232.69%68.74%-4534.11%-27.15%-4630.01%2370.17%ACO-11 % physicians on EHR (Meaningful Use) -6219.67%-277.72%-6219.67%-270.27%591.89%-134.86%1259.01%72.61%2423.05%-1010.68%ACO-39 Documentation of current medications in the medical record 550.25%-114.64%-667.73%1717.08%1577.91%1365.01%216.02%-1420.64%1292.45%ACO-13 Falls: screening for fall risk -4947.76%4413.21%-2873.79%-504.28%-2486.82%-14.83%2183.29%327.97%-2550.44%-679.21%Preventive HealthACO-14 Influenza immunization 1169.06%-3192.47%1834.98%196.78%1444.78%1289.99%77.47%-2304.04%-43.46%ACO-15 Pneumonia vaccination status for older adults -4947.76%1727.61%-5457.90%995.42%1094.20%256.96%-1052.21%-3261.33%-213.40%-1981.95%ACO-16 Body mass index screening and follow-up -1169.05%844.44%1285.63%2323.99%-770.00%1124.05%1435.98%115.20%1820.97%ACO-17 Tobacco use: screening and cessation intervention -1063.95%262.34%354.30%498.34%216.91%647.92%-164.25%-616.31%492.80%ACO-18 Screening for clinical depression and follow-up plan -4947.76%8007.14%-3074.69%2193.76%-643.44%3824.15%130.94%194.92%-3800.53%2107.71%ACO-19 Colorectal cancer screening -4947.76%220.37%-2771.12%1734.44%356.95%85.45%438.57%-1553.54%233.69%-2041.57%ACO-20 Breast cancer screening -4947.76%1830.94%-2880.42%1494.31%712.89%-626.03%1727.36%-1210.95%-376.22%-1105.85%ACO-21 Screening for high blood pressure & follow-up 611.73%1955.33%2152.37%3411.73%180.52%1391.33%1906.78%-2860.78%1040.08%At-Risk PopulationACO-40 Depression remission at 12 months -10000.00%-10000.00%-2574.59%-10000.00%50447.72% -10000.00%-10000.00%3594.21%DM Composi

Diabetes management composite (based on ACO-27 and ACO-41) -1172.32%-3274.15%-670.14%3079.29%5474.53%-983.30%-2013.05%3784.61%-709.64%ACO-27^ Diabetes: hemoglobin A1c poor control -4947.76%-1651.80%2093.87%-1220.93%-3776.80%-40.92%-2092.47%213.69%-2719.20%576.01%ACO-41 Diabetes: eye exam -1346.20%-3577.71%-1282.99%2222.28%5010.46%-1479.89%-2124.07%2749.78%-979.14%ACO-28 Percent with hypertension whose BP < 140/90 435.85%-905.98%-46.87%-212.08%392.75%1237.50%-171.85%-253.74%213.17%ACO-30 Percent with IVD who use of aspirin or another antithrombotic -623.24%134.39%198.82%-359.56%77.12%1550.63%714.25%-814.14%853.84%ACO-31 Heart failure: beta-blocker therapy for LVSD 119.64%-366.62%-381.53%961.41%-40.92%1412.11%936.18%703.37%-146.43%ACO-33 ACE inhibitor or ARB therapy for patients with diabetes or LVSD -593.22%1825.04%-492.89%181.13%-155.88%1890.64%1780.01%-2211.40%467.98%

Revere Health

SHPBanner H

ealth Netw

ork

Comparative Performance

Page 19: ACO Lunch & Learn

Year TA/Disease Drug Pharma Company Payer Contract details Results

2009 Diabetes Januvia (sitagliptin) and Janumet (sitagliptin/ metformin)

Merck Cigna Merck agreed to peg what insurer Cigna paid for Januvia and Janumet to how well individuals with Type 2 diabetes were able to control blood sugar.

• Better placement on formulary secured due to improved outcomes after a year.

• Merck gave additional discounts for achieving better outcomes.

• Increased volume of Merck and competitor products.

2009 Osteoporosis Actonel (risedronate)

Procter & Gamble, Sanofi-Aventis

Health Alliance

P&G and Sanofi-Aventis agreed to reimburse Health Alliance for medical costs of treating covered non-spinal, osteoporosis-related fractures in post-menopausal members correctly taking Actonel prior to the fracture by proportionally reducing Health Alliance’s cost of purchasing Actonel. Health Alliance would be reimbursed if Actonel did not achieve health benefit.

• Able to reach more patients by addressing the payer’s concerns about efficacy.

• Improved adherence• Incidence of non-spinal,

osteoporosis-related fractures was consistent with Actonel clinical trial data.

2011 Multiple Sclerosis

Rebif (interferon beta-1a)

EMD Serono

Cigna/Prime Therapeutics

Amount of rebate based on % of hospitalizations and ER visits avoided by use of Rebif. The deal also stipulates minimum levels of adherence; Serono pays higher rebates for better adherence.

Not yet publicly available

Pharma value-based contracts

Page 20: ACO Lunch & Learn

Year TA/Disease Drug Pharma Company Payer Contract details Results

2014 Cholesterol Crestor AstraZeneca Cigna The two companies entered into a ‘first-of-its-kind contract’ to use predictive risk modeling to assess a patient’s overall health condition to administer the appropriate cholesterol-lowering medication. Cigna states that this will help reduce out-of-pocket costs.

Not yet available

2015 Cholesterol Repatha (evolocumab)

Amgen Harvard-Pilgrim

Gained preferential positioning on the insurer’s formulary in exchange for discounts and potential rebates based on how well the drug performs. Harvard-Pilgrim gets additional discounts if the reduction in LDLs is less than how it performed in clinical trials. Harvard-Pilgrim also gets additional discounts if utilization of the drug exceeds certain predetermined levels.

Locked out Sanofi and Regeneron’s Praluent as Repatha is the only PCSK-9 covered on the formulary.

Not yet available

2016 Heart failure Entresto (sacubitril/valsartan)

Novartis Cigna Pay-for-performance tied to hospitalizations and re-hospitalizations for Cigna’s heart failure population.

Not yet available

Pharma value-based contracts

1 Deloitte. “Value-based pricing for pharmaceuticals: Implications of the shift from volume to value.” Issue Brief, 2012.2 http://www.businesswire.com/news/home/20151109006090/en/Harvard-Pilgrim-Negotiates-First-In-The-Nation-Innovative-Contract3 http://www.streetinsider.com/Corporate+News/Cigna+(CI)+Enters+into+First-of-Its-Kind+Contract+with+AstraZeneca+(AZN)/9543493.html4 http://www.cigna.com/newsroom/news-releases/2016/cigna-implements-value-based-contract-with-novartis-for-heart-drug-entrestotm5 Fierce Health Payer http://www.fiercehealthpayer.com/story/wellpoint-astrazeneca-research-cost-effective-drug-treatments/2011-02-04 6 http://healthaffairs.org/blog/2016/01/29/discovering-new-medicines-and-new-ways-to-pay-for-them/

Page 21: ACO Lunch & Learn

November 2016 executive survey

N=91

Mean covered lives: 42,027

Total lives represented: 2.6 million

Page 22: ACO Lunch & Learn

1%7%

57.1%

14.3%

4.8%

10.7%

4.8%

PioneerAdvance PaymentAIMNextGenMSSPCommercialMedicaid

ACO Panel Distribution

N = 91

Page 23: ACO Lunch & Learn

ACO Panel Distribution

N = 91

10.6%

11%

18% 61%

President/CEOOther C-SuiteVice PresidentDirector

Page 24: ACO Lunch & Learn

Strategic Priorities: Top responses

Behavioral health

Medication management

Post-acute care

Care management, esp. care transitions

Network management

COPD, CHF, Diabetes, etc.

Page 25: ACO Lunch & Learn

Behavioral Health Focus

N = 91

31%

37%

32%YesNot yet, but it is an area of focus for 2017No

“Does your ACO have a specific initiative for patients with behavioral health issues?”

Page 26: ACO Lunch & Learn

Alzheimer’s Focus

N = 91

71%

24%4%

YesNot yet, but it is an area of focus for 2017No

“Does your ACO have a specific initiative for patients with dementia or Alzheimer's Disease?”

Page 27: ACO Lunch & Learn

ACO Leadership Challenges

N = 91

EHR system interoperability

Patient engagement in their care

Lack of physician engagement

Access to timely data from insurers

Physician engagement

Buy-in from the hospital

Communication with physicians

Physicians referring outside network

0 15 30 45 60

36.9

20.6

16.4

40.2

50.6

49.3

52.1

56.2

“Which of the following problems, or concerns, are you experiencing within the ACO?”

Page 28: ACO Lunch & Learn

ACO Leadership Challenges

N = 91

Physician engagement

Patient engagement in their care

Access to timely data from payers

EHR system interoperability

Communication among physicians & staff

Other

0 10 20 30 40

10.7

6.9

13.7

17.8

19.2

31.5

“Which issue has the greatest effect on your ability to provide the HIGHEST QUALITY patient care?”

Page 29: ACO Lunch & Learn

ACO Leadership Challenges

N = 91

Keeping referrals w/i network

Physician engagement

Patient engagement in their care

Access to timely data from payers

EHR system interoperability

Buy-in from the hospital

Other

0 7.5 15 22.5 30

12.2

6.9

6.9

16.7

11

17.8

28.8

“Which issue has the greatest effect on your ability to CONTROL COSTS?”

Page 30: ACO Lunch & Learn

EHR Interoperability

N = 91

Yes, ALL physicians are on the same system as the hospital

Yes, SOME physicians are on the same system as the hospital

No, physician and hospital EHRs are mostly on separate systems

Does not apply to our ACO arrangement

0 17.5 35 52.5 70

7.8

66.2

18.2

7.8

“Do the hospital and community-based physicians within the ACO use the same electronic health record (EHR) system?”

Page 31: ACO Lunch & Learn

Factors affecting admission or readmission rates

N = 91

Percent with a 6 or 7 response

Electronic Health Records

Telemedicine

Home Health Care

Private Duty home care

Pharmaceuticals

Care managers

Pop Health Mgmt Software

Remote monitoring

0 20 40 60 80

23.6

56.3

77.7

20.2

15.4

53.5

16.6

59.7

“On a 7-point scale where 1 = Not at all Important and 7 = Extremely Important, how IMPORTANT are the following in reducing unnecessary hospital admissions or readmission rates?

Page 32: ACO Lunch & Learn

n=91

% Y

ES R

ESPO

NSE

0.0 50.0 100.0

36.6

36.1

50.0

71.2

28.4

79.2

72.6

26.4

Home Health or Home Infusion providerMedical Device or DMEPharmaceutical companySkilled Nursing or RehabilitationNonmedical private duty home care companyAmbulatory Care centersNursing Home providerHospice

Partnering—No Business Relationship

Page 33: ACO Lunch & Learn

n=91

% Y

ES R

ESPO

NSE

0.0 25.0 50.0

26.8

26.4

19.4

17.8

27.0

11.1

9.6

30.6

Home Health or Home Infusion providerMedical Device or DMEPharmaceutical companySkilled Nursing or RehabilitationNonmedical private duty home care companyAmbulatory Care centersNursing Home providerHospice

Partnering—Explored a Potential Business Relationship

Page 34: ACO Lunch & Learn

n=91

% Y

ES R

ESPO

NSE

0.0 25.0 50.0

31.3

30.6

26.4

10.9

32.4

9.7

16.4

34.7

Home Health or Home Infusion providerMedical Device or DMEPharmaceutical companySkilled Nursing or RehabilitationNonmedical private duty home care companyAmbulatory Care centersNursing Home providerHospice

Partnering—Simple Contract in Place

Page 35: ACO Lunch & Learn

n=91

% Y

ES R

ESPO

NSE

0.0 25.0 50.0

5.6

6.9

4.2

0.0

12.2

0.0

1.4

8.3

Home Health or Home Infusion providerMedical Device or DMEPharmaceutical companySkilled Nursing or RehabilitationNonmedical private duty home care companyAmbulatory Care centersNursing Home providerHospice

Partnering—Risk-Based Contract

Page 36: ACO Lunch & Learn

Pharma Partnering

Percent that created education, disease or health management program with the financial support of a pharmaceutical company: 5.4

Percent that have undergone a population health initiative with a pharmaceutical company using data from their patient population: 8.1

Page 37: ACO Lunch & Learn

TRENDING Competitor IDNs are forming unorthodox regional partnerships.

Surge in new health system collaborative arrangements in 2015 and 2016

We trace this phenomena to the formation of Vivity

Some of the other recently formed partnerships include OMNIA Health Alliance, Integrated Health Network of Wisconsin, and MemorialCare Health Alliance ACO

The goals of each alliance differ, but all offer an alternative to a merger or acquisition

Page 38: ACO Lunch & Learn

TRENDING The cultural shift to embracing value-based care is (mostly) here.

Cultural: the shift from volume to value is a mindset

It has taken more than a decade for this transformation to take hold with physicians, and some remain resistant

CMS’ relentless focus on alternative payment methodologies has left most providers without a choice

Page 39: ACO Lunch & Learn

TRENDING The volume-to-value transition mirrors a shift from inpatient to outpatient services.

A favorite mantra: “right care, right place, right time.”

Avoiding unnecessary hospital utilization and providing the means for care in the most cost-effective and efficient way

More ways to deliver care—telehealth, urgent care and home-based services

Page 40: ACO Lunch & Learn

TRENDING Payer-provider IDNs are resurging.

Means to earn back lost revenue, as payers shift from volume to value

Pressure from large payers to “partner” with them and are concerned about payers’ growing market power

Page 41: ACO Lunch & Learn

TRENDING Mergers and acquisitions continue, but regulators are fighting back.

2015 was a record year for mergers in the hospital sector

Hospital transactions increased by roughly 70 percent from 2010 to 2015

While the merger trend continues, the FTC is becoming more aggressive in responding to them

Page 42: ACO Lunch & Learn

TRENDING Hospital drug prices are rising, and IDNs are noticing.

Between 2013 and 2015, hospital drug prices climbed an average 38.7 percent per admission

In our IDN study, about half of IDN executives mentioned (unprompted) rising drug costs as a major concern

Page 43: ACO Lunch & Learn

TRENDING Patient-centered care has arrived.

All IDNs pay close attention to HCAHPS scores

About a third of IDN executives specifically cited increasing patient satisfaction as a 2016 strategic priority.

Most of the ACO executives responses had to do with patient-centered care

Page 44: ACO Lunch & Learn

TRENDING Physicians are burning out, and the problem is getting worse.

Medscape’s 2016 Physician Lifestyle Report depicts some troubling trends

At the top of the list, 55% of critical care, urology and emergency medicine physicians reported being burned out, followed closely by family practice, internal medicine and pediatricians

In our study, some leaders recognized the burnout problem among physicians and nurses

Having satisfied employees is as important as having satisfied patients

Page 45: ACO Lunch & Learn

What We’ve Covered

National ACO Performance

Arizona ACOs

Pharma Value-based Contracting

ACO Executive Survey

Trending in 2017

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About UsDarwin Health provides strategic advisory services for health care executives. Through research, publications and consulting services, we help our clients create meaningful connections within the evolving health care marketplace.

Darwin Health is a division of Darwin Advisory Partners, LLC.http://www.darwinhealth.net17470 N. Pacesetter Way, Scottsdale, AZ 85255 480.305.2059