the case for value-based care: envisioning the future of ......5 agenda the intent: • provide...

The Case for Value-Based Care: Envisioning the Future of Population Health Management

• Celebrating our 25th Anniversary

• 50 Member Hospital Network• Service area covers Nebraska, Kansas, Iowa and Missouri

• Dedicated to enhancing the delivery of rural health care• Access to subject matter experts• Clinical and business‐related collaborative meetings

• Corporate compliance education• Educational events featuring the latest topics and changes in health care

• Networking opportunities• Sharing of best practice

• Physician Hospital Organization (PHO)• Network includes 1,400 providers• Offers a significant range of services to help physicians and hospitals remain independent, and thrive, in our changing healthcare environment

• Accountable Care Organization (ACO)• Participants include: Beatrice Community Hospital and Health Center, Bryan Physician Network, Crete Area Medical Center, Merrick Medical Center, Saunders Medical Center, and Bryan Medical Center

Today’s Speaker

• Cynthia C. Wicks, Principal• Stroudwater Associates

5

Agenda

The Intent:• Provide “Food for thought” for possible post‐COVID‐19 impacts• Build the case for a swift(er) transition from pay for volume to

pay for value for future sustainability

Validation of Current State

What If and the Future

What Do We Mean by Population Health?

Value‐Based Financial Models

Stroudwater’s Transition Framework

COVID‐19 –Case for

Acceleration

7

Polling Question

Are you participating in any value‐based care models, either a CMS model or one with a commercial payer? (These are models where you have some level of risk for the total cost of health care for a population of patients)

Are you participating in any value‐based care models, either a CMS model or one with a commercial payer? (These are models where you have some level of risk for the total cost of health care for a population of patients)

• Yes, with both upside and downside risk• Yes, upside risk only• No• I do not know

CURRENT STATE OF THE UNION AND THE HEALTHCARE SYSTEM

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COVID-19 Impact Summary

• Loss of jobs/increased unemployment/increased Medicaid beneficiaries

• Job furloughs• Remote location working environments• Businesses going under• CMS and commercial insurance companies relaxing rules and

reimbursing telehealth, remote monitoring, etc.• Insurers have seen:

• Loss of members• Unexpected COVID‐19 costs vs deferred and canceled care• Cost of covering co‐pays and co‐insurance

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COVID-19 Impact Summary

• Hospitals and physicians• Loss of revenue due to lost volume and shift in payer mix• Clinical staff burnout• Clinical staff leaving the industry• Practices closing/early retirement

• Heightened awareness of inequities and coordination throughout the healthcare system

• The system was not prepared – testing, PPE• Emergence of multiple underlying pandemics

• Increases in behavioral health issues, SUD, and alcoholism• Potential physician shortage, especially PCPs• Vulnerable populations ‐ chronic disease populations

• Highlighted the reality of FFS reimbursement – NO VOLUME, NO REVENUE

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Polling Question

New codes and policies implemented during the pandemic caused significant billing and claims adjudication issues. Is this an accurate description of your organization’s experience?

New codes and policies implemented during the pandemic caused significant billing and claims adjudication issues. Is this an accurate description of your organization’s experience?

• Yes• No

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About 60% of what PCPs have been doing during COVID-19 was not reimbursable, the COVID-19-19 Primary Care Survey shows.

In fact, practices faring better during the pandemic are ones with population‐based payments.

Source: Primary Care Collaborative & The Larry A. Green Center

Who Is Surviving the Financial Impact of COVID-19 the Best - FFS vs Prospective/Capitated Payment Practices

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“What we see in practices that are doing well right now is that the most beneficial relationship is one in which more than 50 percent of the income for primary care is based on a prospective, capitated payment that is risk‐adjusted and not based on past fee‐for‐service performance,” Etz explained.

How COVID‐19‐19 Imperiled Physician Practices, And How to Save ThemPhysician practice revenue has been cut in half during the early part of the COVID‐19‐19 pandemic. Could telehealth and payment reform save the

independent physician? RevCycle Intelligence, May 6, 2020

Who Is Surviving the Financial Impact of COVID-19 19 the Best – FFSvs Prospective/Capitated Payment Practices cont.

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Pandemic Rebound of Outpatient Visits

The Impact of the COVID‐19‐19 Pandemic on Outpatient Visits: A Rebound EmergesThe Commonwealth Fund, May 19, 2020 Ateev Mehrotra, Michael Chernew, David Linetsky, Hilary Hatch, and David Cutle

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Current HeadlinesCMS Innovation Center Models COVID‐19‐19 Related Adjustments

Adjustments to Pathways to Success, NextGen, and other models

NAACOS Weekly Survey

New Study: COVID‐19‐19 Testing Costs Could Reach $25 Billion a Year for Diagnostic, $19 Billion a Year for Antibody (AHIP posted by Kristine Grow on June 10, 2020)

Lawmakers introduce bill to make Medicare coverage permanent for certain telehealth servicesBecker’s Healthcare, Jackie Drees June 16, 2020

First drug proves able to improve survival from COVID‐19‐19, Modern Healthcare, June 16, 2020Researchers in England say they have the first evidence that a drug can improve COVID‐19‐19 survival: A cheap, widely available steroid called dexamethasone reduced deaths by up to one third in severely ill hospitalized patients.

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Polling Question

COVID‐19 has affected everyone. Most organizations and physicians are reporting 40 ‐60% less revenue, year to date 2020. Is your organization seeing this type of revenue impact?

COVID‐19 has affected everyone. Most organizations and physicians are reporting 40 ‐60% less revenue, year to date 2020. Is your organization seeing this type of revenue impact?

• Yes• No

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New CMS Payment Model Flexibilities for COVID-19: Seema Verma Health Affairs, June 3, 2020

• The major driver of value‐based models is CMS’s Center for Medicare and Medicaid Innovation (CMMI), which celebrates its tenth anniversary this year. CMMI models offer health care providers an array of new payment structures that are designed to reward providers for keeping patients healthy. These models are even more important in a pandemic, to provide consistent, predictable income that keeps the focus on disease prevention.

• Going forward, value‐based care can help ensure health care resiliency. By accepting value‐based or capitated payments, providers are better able to weather fluctuations in utilization, and they can focus on keeping patients healthy rather than trying to increase the volume of services to ensure reimbursement. Value‐based payments also provide stable, predictable revenue—protecting providers from the financial impact of a pandemic.

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Don Berwick’s Keynote Address at the NAACOS Conference, June 10, 2020: “If I had something named after me, it would be Berwick’s Law: We will have healthcare on the right trajectory when all hospitals try to be empty.”

Dr. Berwick takeaways:• Challenged hospitals and ACOs to take on SDOH and cure the

underlying causes of poor health• Global budgets are the only way to get there

NAACOS Conference June 2020

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What If?

• What if ED visit volume only comes back part way? In other words, what if our behaviors are now changed due to fear or greater access to telehealth visits?

• What if we realize not all elective surgery was necessary and we choose not to have it done?

• What if we need to change our physical facilities to better accommodate “clean” and “dirty” cases, and reduced volumes?

• What if we can start bringing care into homes through home care, remote monitoring, or hospital at home programs?

• What if hospitals and physicians had been on global reimbursement or some type of pre‐paid methodology rather than FFS during the pandemic?

• What if the fear of nursing homes causes large closings?

• What if there is a major shift to working remotely?

• What if CMS pushes harder to shift beneficiaries and providers to move into a new payment model?

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Things That Could/Should Accelerate?

• Expanded use of telehealth• Expanded use of remote monitoring• Care delivery redesign

• Physician• Facility

• Relationship change between insurers and healthcare organizations• Don Berwick NAACO Conference challenges – solve the root causes and

don’t repeat our mistakes• The sudden drop in emergency department visits and elective surgeries

shouldn't become a missed opportunity for assessing healthcare value and waste, in Berwick's view. “I hope we have a pause here and say, ‘Wait a minute, wait a minute. What of the stuff that didn’t happen turned out that we really didn’t need to do it in the first place?’”

• He called healthcare a “repair shop — it doesn't cause health." Berwick added later, "What we have been doing for decades I can’t call it anything but stupid. We keep fixing the damage instead of moving to the causes." Many health problems are “products of conditions in the environment, including housing, transportation, food security — you know the list — and racism," he said.

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Polling Question

Will COVID‐19 accelerate healthcare past the “a foot in each canoe” problem?

Will COVID‐19 accelerate healthcare past the “a foot in each canoe” problem?• COVID‐19 will accelerate our change to value‐based care and reimbursement

•We will trend back towards pre‐pandemic normal – volume matters

WHAT DO WE MEAN BY POPULATION HEALTH?

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AbstractPopulation health is a relatively new term that has not yet been precisely defined. Is it a concept of health or a field of study of health determinants?We propose that the definition be “the health outcomes of a group of individuals, including the distribution of such outcomes within the group,” and we argue that the field of population health includes health outcomes, patterns of health determinants, and policies and interventions that link these two…..

Am J Public Health. 2003 March; 93(3): 380–383What Is Population Health?David Kindig, MD, PhD and Greg Stoddart, PhD

Population Health Definition

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AbstractImproving the U.S. health care system requires simultaneous pursuit of three aims: improving the experience of care, improving the health of populations, and reducing per capita costs of health care. Preconditions for this include the enrollment of an identified population, a commitment to universality for its members, and the existence of an organization (an “integrator”) that accepts responsibility for all three aims for that population. The integrator’s role includes at least five components: partnership with individuals and families, redesign of primary care, population health management, financial management, and macro system integration.

HEALTH AFFAIRSVOL. 27, NO. 3: HEALTH REFORM REVISITEDThe Triple Aim: Care, Health, And CostDonald M. Berwick, Thomas W. Nolan, and John WhittingtonPUBLISHED:MAY/JUNE 2008

The Triple Aim

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IHI Triple Aim

Per Capita Cost

Experience of Care(Quality, Satisfaction)

Health of a Population

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Triple Aim and Healthcare’s Value Equation

V=Q/C

Value = Quality / CostOr Sometimes

Value = Quality +Outcomes/ Cost

“The ratio can be improved in 1 of 3 ways: Beef up that numerator by improving quality and outcomes, slim down the denominator by cutting costs, or, ideally, do both at the same time.”Managed Care

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IHI Pathways to Population Health | www.ihi.org/p2ph

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Population Management

• COVID‐19 is an example of the highest/broadest level of Population Health – It is being managed across the globe

• Closer to home:• USA Population• Nebraska• Your local communities• Attributed Members• Patients• Members with chronic

disease• Persons with diabetes• All Medicare members• All BCBS members

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Population Health Management – What Are We Managing?

The Root of the Problem: America’s Social Determinants of HealthAlex M. Azar IIHatch Foundation for Civility and SolutionsNovember 14, 2018Washington, D.C.

• “Now, what I’ve described so far largely involves addressing social determinants by forging better connections between the health system and social services. We believe that can drive significant improvements and savings.

• But what if we went beyond connections and referrals? What if we provided solutions for the whole person, including addressing housing, nutrition and other social needs? What if we gave organizations more flexibility so they could pay a beneficiary’s rent if they were in unstable housing, or make sure that a diabetic had access to, and could afford, nutritious food? If that sounds like an exciting idea . . . I want you to stay tuned to what CMMI is up to.”

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Social Determinants of Health 101 for Health Care: Five plus Five

Five Things We Know About (Social) Determinants of Health in Health Care

1.As a determinant of health, medical care is insufficient for ensuring better health outcomes. Medical care account for only 10‐20 percent… the other 80 to 90 percent are SDoH: health‐related behaviors, socioeconomic factors, and environmental factors.

2.SDoH Are Influenced by Policies and Programs and Associated with Better Health Outcomes.

3.New Payment Models Are Prompting Interest in the SDoH.

Sanne Magnan, MD, PhD, HealthPartners Institute; University of Minnesota October 9, 2017

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Five Things We Know About (Social) Determinants of Health in Health Care, cont.

4. Frameworks for Integrating SDoH Are Emerging. Data frameworks have been proposed for integrating SDoH into primary care and capturing SDoH domains in electronic health records (EHRs).

5. Experiments Are Occurring at the Local and Federal Level. State innovation models are exploring connections among health care, social services, and some SDoH [22]. ACOs are responding to nonmedical needs of patients such as transportation, housing, and food with the assumption that outcomes and cost will improve [4].

Sanne Magnan, MD, PhD, HealthPartners Institute; University of Minnesota October 9, 2017

Social Determinants of Health 101 for Health Care: Five plus Five

“Food as Medicine Group Presentation” Oak Park River Forest Food Pantry, Chicago

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Social Determinants of Health

ACO SAVES $4.8M WITH A NUTRITION PROGRAMNutrition programs are one of the most common types of SDOH initiatives undertaken by hospitals and health systems. About 79 percent of hospitals with an SDOH strategy implemented nutrition programs, the AHA reported.

To reduce the costs of food insecurity, Chicago‐based Advocate Health Care launched (https://revcycleintelligence.com/news/accountable‐care‐organization‐saves‐ 4.8m‐with‐nutrition‐aid) two quality improvement initiatives within their ACO targeting malnutrition. The ACO started to screen all patients at admission for malnutrition risk. Patients with elevated risk scores received an oral nutritional supplement within two days of admission. The ACO also implemented an enhanced nutrition care program in which high‐risk patients received nutrition education, post‐discharge instructions, follow‐up calls, and coupons for retail oral national supplements.

Within six months, Advocate Health Care reduced healthcare costs by $3,800 per patient, resulting in $4.8 million in total savings. The ACO also saw hospital readmission rates drop among patients at risk for malnutrition.

How Addressing Social Determinants of Health Cuts Healthcare CostsNutrition programs, housing initiatives, and ridesharing partnerships are some of

the ways providers are reducing healthcare costs by addressing social determinantsof health. Source: Thinkstock By Jacqueline LaPointe (mailto:[email protected])

June 25, 2018

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Social Determinants of Health

ILLINOIS‐BASED HEALTH SYSTEM REDUCES COSTS 42% AFTER HOUSING PARTNERSHIPAfter noticing a small group of emergency department “frequent fliers,” the University of Illinois Hospital decided to do something about it, the AHA recently reported(https://www.aha.org/news/insights‐and‐analysis/2018‐03‐06‐case‐studyuniversity‐illinois‐hospital‐health‐sciences).

Providers found that a large portion of the individuals frequently seeking services in their emergency department were also chronically homeless, meaning they had been continually homeless for at least one year or had faced four episodes of homelessness within a three year period.

Performing a cost profiling analysis, the hospital found that just 200 of its chronicallyhomeless patients were in the 10th decile for patient cost, with annual per‐patient expensesranging from $51,000 to $533,000.

Almost immediately after partnering with the Center for Housing and Health, theUniversity of Illinois Hospital saw participant healthcare costs fall 42 percent, and morerecent studies have found that costs dropped by 61 percent.In terms of utilization, the emergency department reported a 35 percent reduction in useand the hospital noticed an increase in the use of its clinics.

How Addressing Social Determinants of Health Cuts Healthcare CostsNutrition programs, housing initiatives, and ridesharing partnerships are some of

the ways providers are reducing healthcare costs by addressing social determinantsof health. Source: Thinkstock By Jacqueline LaPointe (mailto:[email protected])

June 25, 2018

America’s Health Ranking 2019 – United Health Foundation

https://www.americashealthrankings.org/learn/reports/2019‐annual‐report

VALUE-BASED FINANCIAL MODELS

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The Healthcare Insurance Premium Dollar

Where Does Your Health Care Dollar Go? posted by AHIPon May 22, 2018

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The Essence of Any Shared Savings Model

• Attributed Members• Risk Adjusted Benchmark or “Budget” per member• Usually paid FFS during the contract period and then reconciled

against the Benchmark• Quality Matters – pre‐established metrics, reported and scored• Often contains a “risk corridor”

• Ex. + 2.5% ‐ No shared savings unless at least 2.5% below Benchmark and no shared losses unless more than 2.5% above Benchmark

• Total Cost of Care and Quality BOTH influence success• Actual TCOC determined• Actual Quality score determined• The LEVEL of Quality informs the amount of the Shared

Savings Pay Out and sometimes mitigates the amount of Shared Loss Paid Back

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The Essence of Any Capitation or Full Risk Model

• Capitation or Full Risk can be paid either on a Per Member Per Month (PMPM) basis or as a Percent of Premium for the provision of medical services defined under the capitation contract• Paid for each member enrolled with or attributed to the

primary care physicians* in the provider network with the capitation contract

• Providers with capitation contracts are at risk for providing medical services within the defined PMPM

*Occasionally attribution models will assign members to Specialists

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Fixed Potential Capitation Dollars From All Sources

Expand the pie of dollars to be divided among Network Providers

Objective: More Control of Benchmarks or the Premium Dollar

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Budget

Incentives

Infrastructure

• Global Capitation• Interim Fees • % Withholds

• Quality Metrics• Surplus/Deficit• MD Engagement

• PCP Mgmt. Fees• Network Admin. Fees• Care Management Fees

Sources of Global Contract Revenue

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Global Budget $ PMPM

Blue Oval = Settled Against Global BudgetTeal Box = Not Settled Against Global Budget

PCP Coordination

of Care $ PMPM

Monthly Payments To Provider Network

Interim Reimbursement To Providers for All Services Charged To The Global Capitation Budget

Hospital Services

Ancillary Services/Rx

Subacute Facilities

Physician Services

Visiting Nurses/IVF

Behavioral Health Quality Bonus

Surplus or Deficit

Annual Payments To/From Provider

Network

Infrastructure $ PMPM

Surplus/Deficit & Applicable Withholds

Global Capitation Revenue and Settlements

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Alignment of Incentives• PCPs• SCPs• Community Hospital• Tertiary Hospital• Health System• Payor

Risk Mitigation Strategies• Stoploss/Reinsurance• Reserves• Withholds• Catastrophic/Pandemic Events• Funds Flow – Provider Risk

Sharing

Assumption of Risk: How Much and How Soon?

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Polling Question

Which of the following are barriers for your practice to enter value‐based care arrangements? (Select all that apply)

Which of the following are barriers for your practice to enter value‐based care arrangements? (Select all that apply) • Lack of knowledge of models• Concern value‐based care arrangements will be an additional administrative burden

• Concern revenue will be lower under value‐based care arrangements

• Do not have financial capacity to take on risk

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How Do You Get More Control of Value-Based Revenue?

• Negotiate commercial contracts that shifts some of the administrative overhead to the ACO/CIN entity

• Increase benchmark or capitation payment:• Historical claims• Risk adjustments – to address the issue of “my patients are

sicker and therefore cost more to take care of…”• Accurately report patient diagnoses and condition

(Hierarchical condition category (HCC) coding is a risk‐adjustment model originally designed to estimate future health care costs for patients) • MUST BE REPORTED ANNUALLY

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HCC Example

Five Action Items to Improve HCC Coding Accuracy and Risk Adjustment With Analytics, Health Catalyst, April 9, 2019Posted in Financial Alignment and ROI and Value‐Based Care

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Details that Will Impact Your Financial Performance

• Wellness Visits for Seniors Do not leave revenue on the table or

loose the opportunity to identify high risk complex patients

• Risk coding Consider using training and tools

designed to help you accurately report diagnostic coding which will impact risk score and budget

• Assure all billing systems are capable of reporting all documented diagnostic codes

• Harness all data Claims, EMRs, Care Plans, SDOH,

psychosocial information• Identify leakage

Outside the network To higher cost alternatives Devise plans to change behavior

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Polling Question

Which of the following best describes your view of Population Health Management and its place in the health care delivery system?

Which of the following best describes your view of Population Health Management and its place in the health care delivery system?• Population Health Management is critical to the sustainability of the healthcare industry

• Population Health Management has the potential to improve quality and/or lower costs, but that has not yet been proven

• Population Health Management is unlikely to materially affect quality and/or costs in the healthcare industry

• Population Health Management will decrease quality and/or increase costs in the healthcare industry

• No opinion on Population Health Management

PAUSEFive‐minute break

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Polling Question

Which of the following are barriers for your organization to enter value‐based care arrangements? (Select all that apply)

Which of the following are barriers for your organization to enter value‐based care arrangements? (Select all that apply)• No available/willing payers with value‐based care arrangements

• Do not have people, resources and/or infrastructure to succeed in these arrangements

• Insufficient attributed patients and/or lack of providers to partner with

• Concern that patient outcomes and quality of care could decline

STROUDWATER’S POPULATION HEALTH TRANSITION FRAMEWORK

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• The strategic framework on the following page is designed to assist organizations in transitioning from a payment system dominated by the FFS payment model to one dominated by population‐based payment models

• Delivery System strategic component addresses the imperative to transform the current "sick care" model for optimal fit with population‐based payment

• Payment System strategic component addresses the imperative to proactively transform payment from FFS to population‐based payment

• Population Health/care management component requires creation of an integrating vehicle so that providers can contract for covered lives, create value through active care management, and monetize the creation of that value

• Strategic imperatives drive the initiatives that must be designed and implemented to make the transition

• Each initiative is developed in phases that correspond to the evolution of the payment models

• Work on each initiative must begin immediately so they will be ready to implement when required

• Increasingly, board and leadership should be aware of the transitions occurring in the healthcare industry and incorporate new strategies into their organization

Opportunities

Population Health Transition Framework

PHASE II PHASE III

DELIVERY SYSTEM

PAYMENT SYSTEM

POPULATION HEALTH

MANAGEMENT (INTEGRATED

DELIVERY AND

PAYMENT SYSTEM)

PHASE I

DEVELOP AND IMPLEMENT

• PCMH & Team‐based Models of Care

• Organizational Structure• Pop Health Technology• Care Management Model


• Specialist & Service Network• Post‐acute Care Strategy• Risk Stratification Process• Population Specific Programs

• Cultural Transformation


• Value‐Based Tiered Network• New products• Claims/EMR integration• Full risk finance & accounting

• Full Clinical Integration

Popu

latio

n He

alth Readine

ss Assessm

ent a

nd Strategy

IMPLEMENTOperational, patient experience, quality

performance improvement

PLANPrimary Care Network Alignment

IMPLEMENTPrimary Care Network Alignment

STRATEGYNetwork and Service Area

“Right Sizing”

PLANNetwork and Service Area

“Right Sizing”

IMPLEMENTNetwork and Service Area

“Right Sizing”

STRATEGY2‐Sided to Full Risk Payment

Models

PLAN2‐Sided to Full Risk Payment Models

IMPLEMENT2‐Sided to Full Risk Payment

Models

PLANUpside/Low Risk Payment Models

IMPLEMENTUpside/Low Risk Payment Models

IMPLEMENTSelf‐Funded Employee Health Plan

FFS Quality/Utilization

1

2

3

7

6

5

PHASE IV

Payment and Delivery System ReformTransition Framework


Provider‐Based Health Plan 4

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Timing and Staying In Sync Matters

PHASE II PHASE III

PAYMENT SYSTEM

PHASE I


Models



Models





7

6

5Payment and Delivery System Reform

Transition Framework

Maximize FFS Revenue• Identify and address leakage• Bill for AWVs and CCM services • Reduce Adverse Condition

Penalties• Reduce Readmits and Readmit

PenaltiesUse Self‐insured Employee Plan to Beta test Population Health Strategy• Design value‐based features into

benefits• Use data to understand TCOC

and define cost reduction strategies

• Beta test processes and care management model

Maximize any P4P quality and utilization incentives

Enter into upside/low risk Value‐based payment model contracts –transition from FFS

• Develop and implement cost of care reduction strategies

• Monitor ongoing utilization and quality metrics to achieve performance thresholds and TCOC objectives

“Virtual Insurance Company” = Own and Control Total Cost of Care /MLR• Determine level of

risk willing and capable of assuming using actuarial analysis

• Run rate scenarios and methodologies

• Rate analyses• Advanced APM

options and strategy

• Claims / encounter file support and analyses

• Reserves

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PHASE II PHASE III

DELIVERY SYSTEM

PHASE I

IMPLEMENTOperational, patient experience,

quality performance improvement




“Right Sizing”


“Right Sizing”


“Right Sizing”

1

2

3

Grow Volume• Grow existing services • New Services• Geographic expansion

Performance Improvement• Improve staff productivity• Improve throughput – process

redesign /maximize efficiency• Facility and physician practice

operational improvement• Maximize revenue via proper

documentation, coding, and billing processes

Quality and Utilization• Improve quality outcomes• Improve patient experience• Minimize LOS and hospital

readmits vs benchmarks

Identify and Lock in Future Revenue

Centers• Operationalize a

CIN to align PCPs• Develop a Primary

Care network, employment and/or contractual relationships

• Physician, hospital, provider incentive alignment

• Maximize number of attributed lives by maximizing your PCP base

Amass as many attributed lives as possible through: • Strategic partners

and affiliations• Right size the

network, services, and facilities

• Reduce the delivery system’s unnecessary fixed costs


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PHASE II PHASE III

POPULATION HEALTH

MANAGEMENT (INTEGRATED DELIVERY AND

PAYMENT SYSTEM)

PHASE I


• Identify Leadership• PCMH & Team‐based Models of Care

• Pop Health IT and Analytics• Care Management Model


• Specialist & Service Network• Risk Stratification Process• Population Specific Programs



• Value‐Based Tiered Network• New products• Claims/EMR integration• Full Clinical Integration

PHASE IV



1. Network

2. Structure – Leadership, Organization, Operations, Data

3. Care Management Model

4. Patient Engagement

5. Quality

6. Cultural Transformation

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Network:• PCP Practice Transformation

• PCMH & Team Based Models of Care• Proactive coordinated care and services• Evidence‐Based Clinical Practice Guidelines• Standardization of Care Delivery – Reduction of Practice Variation• Appropriate HCC documentation and coding

Organization, Operations, Data:• PHO, IPA, CIN, ACO

• Identify Physician and Administrative Leadership• Governance• Committees

• Foundational Pop Health technology ‐ Buy or Build Decision• Risk Stratification model(s) development and implementation• Care Management platform

Care Management Model – Develop or Buy:• Transitions of Care Coordination• Comprehensive Care Management Programs – Buy or Build• Population‐specific registries – proactive outreach and education

Patient Engagement:• Patient satisfaction and leakage root cause analysis• Engage employees and dependents in care management model to promote better health decisions

Quality:• Quality programs and processes to meet specific payer P4P contract incentives• Hospital quality improvement to minimize readmissions and adverse conditions

Cultural Transformation • Revisit mission and vision• Develop Education and Training Plan• Develop Re‐branding Plan• Develop Change Management Plan

4

Phase I


• Identify Leadership• PCMH & Team‐based Models of Care• Pop Health IT and Analytics• Care Management Model

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INTENT: IMPLEMENT POPULATION HEALTH

FOUNDATIONAL INFRASTRUCTURE

Network:• Develop strong specialist and service network and align incentives• Develop and implement a Post‐Acute Care strategy and network

Structure ‐ Organization, Operations, Data:• Contract compliance processes and monitor clinical integration compliance• Key metric reporting/dashboards• Funds flow model• Total Cost of Care (TCOC) reporting and monitoring

Care Management Model (Prioritize implementation based on Population Served):• Utilize risk stratification and population data to build population‐specific programming

• Disease and complex care management programs• Health and Wellness Programs

• Collaborate with behavioral health/substance use disorder programs• Collaborate with home & community‐based services and programs• Collaborate with programs and services to address SDoH• Manage Post‐acute care service utilization and consider SNFist program

Patient Engagement Strategy(ies):• Interventions to address identified utilization root causes• Care management patient engagement strategies

• Community Health WorkersQuality:• Value‐Based Metric Reporting Capability – build or buy• Quality performance monitoring and improvement

Cultural Transformation:• Re‐alignment of staff and network incentives and goals• Execute education and training plan• Execute re‐branding plan• Execute change management plan


• Specialist & Service Network• Post‐acute Care Strategy• Risk Stratification Process• Population Specific Programs• Cultural Transformation

4

Phase II

INTENT: IMPLEMENT UPSIDE AND LOW RISK

PAYER CONTRACTS AND CONTINUE BUILDING

POP HEALTH INFRASTRUCTURE

58

Network:• Identify Preferred Value‐based Network, selecting high performing providers and removing low performers based on:

• Total Cost of Care/efficiency• Quality and Outcomes• Patient Experience

• Identify and establish desired geographic market area and network adequacy requirements for a MARKETABLE network

• Execute Payer Strategy• Develop Payer Partners – commercial, government, self‐insured employers

• Develop New Products with aligned Benefit Designs

Organization, Operations, Data:• Data and Informatics:

• Clinical data exchange• Interoperability• Real time actionable data systems and processes in place

• Build the financial and accounting and reporting systems required to support a full risk product/revenue environment• Redefine revenue and cost centers• Claims, EMR integration• Transition from claims to encounters for monitoring and reporting resource and service utilization• Change accounting system• Redesign /redefine business dashboard performance metrics

Care Management Model:• Continue implementing and monitoring population –specific programing as the population served evolves

• Complementary Therapy integration• Telemedicine integration• Use of behavior and psychosocial assessment tools

• Ongoing comprehensive coordination of care across a fully integrated delivery system

Patient Engagement:• Maximize use of technology to engage patients (such as aps, wearables, etc..)

Quality:• Ongoing monitoring and performance improvement to achieve all Quality metrics

Cultural Transformation:• Ongoing education and training and marketing• Episodic care to holistic/longitudinal comprehensive coordinated care model• Successfully made the transition from a “head in every bed” culture to a “what is the optimal care, location, price for

the member” culture• Sustainable cultural transformative processes in place


• Value‐Based Tiered Network• New products• Claims/EMR integration• Full risk finance & accounting• Full Clinical Integration

4

Phase III

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INTENT: VIRTUAL INSURANCE COMPANY—

FULL CLINICAL INTEGRATION,

POPULATION HEALTH INFRASTRUCTURE AND CULTURE SUPPORTING TWO-SIDED AND FULL

RISK

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Network

Phase 1 Network:

• PCP Practice TransformationPCMH & Team Based Models of CareProactive coordinated care and servicesEvidence‐Based Clinical Practice GuidelinesStandardization of Care Delivery – Reduction of Practice VariationAppropriate HCC documentation and coding

Phase II Network:

•Develop strong specialist and service network and align incentives

•Develop and implement a Post‐Acute Care strategy and network

Phase III Network:

• Identify Preferred Value‐based Network, selecting high performing providers and removing low performers based on:Total Cost of CareEfficiencyQuality and OutcomesPatient Experience

• Identify and establish desired geographic market area and network adequacy requirements for a MARKETABLE network

• Execute Payer StrategyDevelop Payer Partners –commercial, government, self‐insured employers

•Develop New Products with aligned Benefit Designs

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Organization, Operations, Data

Phase I: Organization, Operations, Data:

• PHO, IPA, CIN, ACOIdentify Physician and Administrative LeadershipGovernanceCommittees

• Foundational Pop Health technology ‐ Buy or Build DecisionRisk Stratification model(s) development and implementationCare Management platform

Phase II: Structure ‐ Organization, Operations, Data:

• Contract compliance processes and monitor clinical integration compliance

• Key metric reporting/dashboards

• Funds flow model• Total Cost of Care (TCOC) reporting and monitoring

Phase III: Organization, Operations, Data:

• Data and Informatics:Clinical data exchangeInteroperabilityReal time actionable data systems and processes in place

• Build the financial and accounting and reporting systems required to support a full risk product/revenue environmentRedefine revenue and cost centersClaims, EMR integrationTransition from claims to encounters for monitoring and reporting resource and service utilizationChange accounting systemRedesign /redefine business dashboard performance metrics

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Care Management

Phase I: Care Management Model – Develop or Buy:

• Transitions of Care Coordination• Comprehensive Care Management Programs – Buy or Build

• Population‐specific registries –proactive outreach and education

Phase II: Care Management Model (Prioritize

implementation based on Population Served):

• Utilize risk stratification and population data to build population‐specific programmingDisease and complex care management programsHealth and Wellness Programs

• Collaborate with behavioral health/substance use disorder programs

• Collaborate with home & community‐based services and programs

• Collaborate with programs and services to address SDoH

•Manage Post‐acute care service utilization and consider SNFist program

Phase III: Care Management Model:

• Continue implementing and monitoring population –specific programing as the population served evolvesComplementary Therapy integrationTelemedicine integrationUse of behavior and psychosocial assessment tools

• Ongoing comprehensive coordination of care across a fully integrated delivery system

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Polling Question – Explanation Slide

.

QuestionMy organization is firmly in Phase I – still FFS and Volume Driven

My organization is firmly in Phase II – Some value‐based contracts, mostly upside risk only, delivery system and care management initiatives are in alignment

My organization is firmly in Phase III – Mostly in value‐based care contracts with upside and downside or full risk, population management is well advanced, and delivery system is aligned

My organization’s delivery system transformation is ahead of its predominant value‐based reimbursement model and population health strategy

My organization’s reimbursement model is ahead of its delivery system transformation and population health strategy

Based on today’s description of the transition framework, which best describes your organization? Please choose a number 1 through 5.

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Polling Question

Based on today’s description of the Transition Framework, which best describes your organization?

Based on today’s description of the Transition Framework, which best describes your organization?• My organization is firmly in Phase 1• My organization is firmly in Phase 2• My organization is firmly in Phase 3• My organization’s delivery system transformation is ahead of its predominant value‐based reimbursement model and population health strategy

• My organization’s reimbursement model is ahead of its delivery system transformation and population health strategy

Please enter a number 1 through 5 that best describes your organization.

OPPORTUNITIESPopulation Health Management

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Early Population Health Decisions and Opportunities

Physicians

• PCMH & Team‐Based Models of CareBest performing peer rural hospitals examine opportunities to adopt evidence‐based protocolsStaff working in care teams and at top of licenses

• Appropriate HCC documentation and coding• Annual Wellness Visits

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What Is Team-Based Care?

Team‐based care is a strategic redistribution of work among members of a practice team

• The physician (or in some circumstances an NP or PA) and a team of nurses and/or MAs share responsibilities for better patient care. Common shared responsibilities include:Pre‐visit planning and expanded intake activitiesMedication Reconciliation, Updating the patient’s history and collaborating with the patient to set the visit agenda

• During the physician/provider portion of the visit, the nurse or MA documents the visit, allowing the physician to have uninterrupted time with the patient. At the conclusion of the visit, the nurse or MA conducts essential care coordination activities, such as arranging follow‐up visits or ordering requested testing and referrals.

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Polling Question

For your primary care practices: Which of the following, if any, have been implemented? (Select all that apply)

For your primary care practices: Which of the following, if any, have been implemented? (Select all that apply)• Implement PCMH or Team‐Based Care Models • Focused effort on performing Annual Wellness Visits• Education on risk adjustment or coding improvement• Integrated care managers and/or social workers in practice

• Developed standard evidence‐based protocols

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Structure

• LeadershipIdentify physician and administrative leadership – they are the key to success

• Data and TechnologyYou need to be able to identify and find patients needing care managementYou will need to be able to risk stratify your patients – who are the sickest or have the highest costs or utilization? Who is most likely to benefit from care management?You will need a care management platform to keep track of the patients enrolled in care management and to document and communicate assessments, care plans, and care management interventionsStart thinking about how best to optimize your EHR

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Structure, cont.

• Data and Technology• What can you do even without these tools:Go through a robust community needs assessment process – there is lots you can learn about the populations you serveIf your organization is self‐insured, there is data to be mined from those claims or from other claims data you may have from other risk‐based contractsUse EHR data and any internal reports to identify chronically ill patients

• Focus on Data Analytics as you move into Phase IIPredictive Analytics must be:• Real‐time• Actionable• Delivered to point of care

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Polling Question

What has your facility/practice done to facilitate success in value‐based care models? (Select all that apply)

What has your facility/practice done to facilitate success in value‐based care models? (Select all that apply) •Move to electronic health record (EHR)• Connect EHR with other providers and/or facilities

• Interoperability and optimization of EHR• Implement method for risk stratification• Improve analytical capabilities

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Care Management

• Transitions of care coordination• Best performing peer rural hospitals implement care management processes that ensure discharge planning is consistently done for inpatients, transportation and home support are ensured, follow‐up appointments are scheduled, and instructions on medications are given

• Population‐specific registries – proactive outreach and education• Reduce inappropriate utilization of the ED and avoidable admissions and readmissions• Perform a root cause analyses• Provide patient education of alternatives• Assess urgent care options and resources • Assess after hours access to medical services and primary care

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Care Management, cont.

• Will you develop your own care management model or outsource?

• Design and implement a care management model for your self‐insured population:Provides an excellent way to beta test various patient engagement and care management initiativesAny savings are a direct improvement to the bottom line

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• Usually very focused around primary care and are both process and outcomes driven

• Implement quality programs and processes to align with payer P4P or ACO contract incentives

•Make them payer neutral• Establish a quality committee that looks at all contractual quality measures and establishes consistent quality improvement initiatives and processes at all physician offices

Quality Outcomes and Improvement

Quality Outcomes and Improvement

• Revisit mission and vision• Develop education and training plan• Develop re‐branding plan• Develop change management strategy and action plan

Cultural Transformation

Cultural Transformation

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Polling Question

What has your facility/practice done to facilitate success in value‐based care models? (Select all that apply)

What has your facility/practice done to facilitate success in value‐based care models? (Select all that apply)• Implement processes for improving quality metrics

• Implement transition of care processes• Identify/develop community resources• Developed a Post‐Acute Care Strategy• Captured SDOH information in EMR

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The COVID 19 Push: Accelerate Care Delivery Design into Phases II and III

• Redesign Primary Care Delivery• Telehealth is already up and running for most organizations

• Time to fine tune processes and capacity• Improve confidentiality and security issues if necessary• Determine where it fits into the NEW primary care delivery

model• Evaluate the rest of the delivery system and determine re‐design

• Role of post‐acute care and where?• Home Care?• Hospital at Home?• Use of EMTs for home urgent care?

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COVID-19 Push – Payment Model

• IF you agree telehealth, and other COVID‐19‐related changes will and should take place to redesign the delivery system…

• THEN, you must also agree, that the payment model needs to change with it

PHASE II PHASE III

DELIVERY SYSTEM

PAYMENT SYSTEM

POPULATION HEALTH

MANAGEMENT (INTEGRATED

DELIVERY AND

PAYMENT SYSTEM)

PHASE I


• PCMH & Team‐based Models of Care

• Organizational Structure• Pop Health Technology• Care Management Model


• Specialist & Service Network• Post‐acute Care Strategy• Risk Stratification Process• Population Specific Programs



• Value‐Based Tiered Network• New products• Claims/EMR integration• Full risk finance & accounting

• Full Clinical Integration

Popu

latio

n He

alth Readine

ss Assessm

ent a

nd Strategy

IMPLEMENTOperational, patient experience, quality

performance improvement




“Right Sizing”


“Right Sizing”


“Right Sizing”


Models



Models





1

2

3

7

6

5

PHASE IV




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REPORT TO THE CONGRESS Medicare and the Health Care Delivery System (The Medicare Payment Advisory Commission (MedPAC)

In Dr. Francis J. Crosson’s cover letter, he states:The Commission asserts that the use of fee‐for‐service payment for Medicare services should be replaced, over time and to the degree feasible, by payment to accountable systems of care that have incentives to:

• provide preventive services and early disease detection.• improve the quality and beneficiary experience of care.• avoid delivering unnecessary or inappropriate services.• control the costs of providing necessary services in the most appropriate care setting.• deliver chronic care services through care coordination among providers.• coordinate both the medical and nonmedical needs of beneficiaries.• enhance the use of technologies that improve quality and reduce program costs.

Under an improved Medicare program, most beneficiaries would be able to opt to receive their care through accountable entities. Medicare could design incentives that encourage beneficiaries to choose one of these entities and give providers incentives to participate in them.The Commission well understands the magnitude of effort inherent in making such changes. That said, improvements in the Medicare Advantage program, in the various accountable care organization programs, and in other payment or delivery system innovations currently in place can be starting points for this work. In addition, serious attention must be given to new innovations, for example, changing how hospitals are paid and giving providers incentives to manage the cost of medications. The Commission believes that the culmination of the changes we have outlined will provide the Congress and the American people with the opportunity to better predict and manage the long‐term cost and quality of the Medicare program.

Accelerate from FFS to Value-Based Reimbursement Reprise• FFS has caused a reduction in

revenue during the pandemic• COVID has escalated the timetable

for telehealth, home care services, hospital at home, and other non‐hospital/non‐office service settings

• Staying FFS post COVID may still mean lower revenue due to:• Sift in payer mix, at least for a

while• Lower ED volume?• Lower number of in person

office visits• Pay for Value, can provide:

• Steady income• More financial control• Room to innovate• Reduces inefficiencies• Healthier populations

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Key Takeaways

The sustainable way forward is to move from pay for volume to pay for value

The need for speed has changed The timing for changes is important The delivery system transformation and the reimbursement

methodology need to stay in sync Pay attention to Medicare Advantage as well as new CMS models Pay close attention to commercial contracts and engage in new

dialog with payers Find your willing payer partners Develop/revisit your transition strategy

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Potential Barriers to Speed of Change

CMS has indicated a desire to make some permanent changes to telehealth rules, but how soon will that occur?

Some changes that were made during COVID‐19 would take legislative changes

Need to find willing payer partners and renegotiate commercial contracts

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Questions?

• Questions• Feedback welcome – Surveys will be sent after the webinar• Thank you!

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Real-world, mission-critical, actionable advisory services as you and your community navigate the dynamic risks of today’s healthcare environment.

Stroudwater Associates is a leading national healthcare consulting firm serving healthcare clients exclusively. We focus on strategic, operational,and financial areas where our perspective offers the highest value.

We’re proud of our 34‐year track record with rural hospitals, community hospitals, healthcare systems, and large physician groups.

Cynthia C. Wicks, Principal(T/F) 207-221-8254(M) 774-328-1316

[email protected]

Strategic Advisory• Strategic Planning• Mergers, Affiliations & Partnerships• Population Health Strategies • Physician‐Hospital Alignment• Strategic Facility Planning• Capital Planning & Access• Post‐Acute Care Strategy

Operational Advisory • Performance Improvement & Restructuring• Provider Practice Operations Improvement• Revenue Cycle Solutions• Post‐Acute Care Operations• Payor Contracting Advisory• Staffing & Productivity Improvement• Cost Report Reviews and Analysis

Contact Us

Heartland Health Alliance Brenda LambRural Division Improvement [email protected]

Bryan Health ConnectWanda Kelley, MSN, RN‐BC, PCMH‐CCEClinical Integration & Population Health [email protected]

Sharon Leners, BSN, RNGrant & Clinical Linkage [email protected]

APPENDIX

DELIVERY SYSTEM OPPORTUNITIES

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Phase I Delivery System and Reimbursement Summary

Grow Volume

Grow existing services

New Services

Geographic expansion

Performance Improvement

Improve staff productivity

Improve throughput – process redesign /maximize efficiency

Facility and physician practice operational improvement

Maximize revenue via proper documentation, coding, and billing processes

Quality and Utilization

Improve hospital quality outcomes

Improve patient experience

Minimize LOS and hospital readmits vs benchmarks

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Population Health Strategy

Enhance your organization’s current strategic framework by focusing on the following initiatives aimed at optimally positioning the hospital and physicians for emerging population‐based payment methodologies:

• Incorporate the transitioning payment system into your strategic plan framework to ensure that strategic objectives are timed to maximize the payment system that currently exists, while positioning for payment systems of the future

• Increasing alignment and leveraging of your primary care network, while promoting high quality and patient safety scores to community

• Continuing to increase efficiency and financial viability to position for population‐based payment methodologies

Get Population Health on the Radar Screen

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For Consideration• Revenue Cycle

• Commercial Contracts• Catalog and determine profitability of all major commercial payers, comparing payment to

Medicare and seek contract increases, if necessary• Develop your organization’s “Value Proposition” and use it negotiate more favorable contracts

reward quality and outcome improvements, while reducing TCOC• Continue to maximize commercial population health incentives and explore additional

opportunities that provide reimbursement for “healthcare”• Don’t be afraid of Medicare Advantage – if you are not participating, look to seriously evaluate

• Best practice peer rural hospitals implement a revenue cycle committee that meets at least bi‐weekly and includes representatives from clinical, financial, administrative, medical staff, health information management, and the business office to oversee and drive improvements regarding the revenue cycle process

• Best‐performing peer rural hospitals establish, target, track, and manage performance indicators, such as the following HFMA best‐practice revenue‐cycle metrics, in an effort to improve revenue cycle performance:

• Cash collected and cash percentage of net revenue• Gross and Net A/R and A/R days• In‐house and discharged not‐final‐billed receivables• Cost to collect• Bad debt and charity as a percent of gross charges• Denials as a fraction of gross charges• Point of service collections as a fraction of goal

Best Practice Delivery System Improvement Examples

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For Consideration• Cost Report Improvements

• Medicare Bad Debt• Develop policies and procedures to ensure claims with no payment activity are

pulled back from collection agencies on a timely basis, deemed uncollectible, and the Medicare claims placed on the cost report for reimbursement

• Peer hospitals often set the time period at 120‐180 days with no payment activity

• Target 10% of Medicare outpatient patient liability for allowable bad debt

• Strategic Pricing Assessment• Continue evaluating chargemaster to ensure pricing is strategic and certify the

following:

• Charges reflect resources necessary to provide services with a reasonable mark‐up

• Charge levels remain price‐competitive with other hospitals and do not unnecessarily burden Medicare patients through shifting of co‐insurance


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For Consideration• Provider Alignment

• Given the growing importance of primary care network development for success in value‐based payment systems, pursue increased interdependence with primary care providers in the service area through the following functional, contractual, and governance alignment strategies:• Functional

• EHR – leverage team‐based care and IT solutions to ensure all staff is practicing at the “top of their license” to improve efficiency of practice and patient experience

• Focus on provider retention by allowing medical staff to regularly meet with administration to voice concerns, ideas, and provide feedback

• Contractual • Add additional quality performance metrics and other value‐based care

incentives to provider contracts to more closely align medical staff • Governance

• Continue to seek medical staff advice and give medical staff a voice on both management and strategic functions

• Evaluate options to convert clinics to rural health clinic designation • Being to evaluate and explore relationships with specialty providers to increase both the

access and number of services offered within the primary service area• Align expansion of specialty services with current and anticipated demographics and

health care needs of the population served, based on available population data

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For Consideration• Hospital Quality

• Identify and implement hospital quality improvement initiatives to minimize readmissions and adverse conditions

• Continue to foster a quality and safety culture as a strategic priority across all levels of the organization with the goal of obtaining top performer in the region ‐ Set specific goals to improve quality scores where your organization my not be the market leader

• Internally publish HCAHPS scores to gain buy‐in from all levels within the organization• Consider further investment in quality infrastructure including daily safety meetings and

huddles • Best practice CAHs often have department supervisors participate in the following to

improve patient outcomes and to communicate patient quality issues and events• Daily huddles and rounds at 7:00 am with bedside reporting• Daily multidisciplinary meeting at 8:00 am with nursing, therapies, pharmacy, and

other departments to discuss quality and any patient related issues for the day• Daily safety meetings are held at 11:00 am to discuss any safety, system, or facility

issues• HCAHPS Committee meets every other month and is composed of frontline staff

of every department ‐ results are shared with the board• Daily “Quiet Time” at 3:00 pm to allow patients to rest and nurses to catch up on

documentation

• Best practice peer rural hospitals will implement multiple systems and processes to ensure the organization provides high quality services to the patient population

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For Consideration• ED

• Track and monitor KPIs related in the ED to drive and maintain improvement efforts, including ED admissions (acute/observation) as a percentage of ED visits, transfer rates as a percentage of ED visits, EDCAHPS, as well as patient throughput metrics to improve bed utilization and ED quality and accountability

• Review all patient transfers in the utilization review committee meetings that include provider representation to ensure transfers as well as all inpatient admissions are appropriate and medically necessary

• Define the Care Spectrum (those patients able to receive care at your facility) as a collaborative, multi‐disciplinary group, addressing the following categories: Medical Staff, Nursing, Pharmacy, Medical Equipment and Therapy Services

• Work on developing efficient staffing models that leverage the cross‐training of the ED and Med/Surg to achieve additional efficiencies in staffing

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IT

• Evaluate the integration of all systems across platforms to mitigate interoperability concerns and increase efficiencies

•Develop a multi‐year strategic IT vision that leverages IT resources to create a high‐quality culture of patient safety through system training and integration into clinical operations

•Recognize IT as a strategic asset, rather than an expense to be managed

Data

•Best practice peer rural hospitals implement and maintain EHRs that are readily used within the industry to reduce upgrade cost and ensure access to staff who can use the system to readily extract data and communicate patient care needs

Staffing Benchmark Analysis

•Use volume‐based staffing benchmarks to evaluate departmental staffing levels for possible inefficiencies•Continue to monitor departments/units, recognizing that staffing maybe already be at a minimum threshold

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