Health Reform and Medical Prac3ce in Maine. John Freedman MD MBA June 10, 2013

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1 Health Reform and Medical Prac3ce in Maine John Freedman MD MBA June 10, 2013

2 Disclosure Statement I have no relevant financial rela3onships to disclose. The opinions expressed are my own.

3 Objec3ves Describe major trends in Maine Recognize key provisions of na3onal health reform Understand lessons learned in MassachuseQs Discuss possible implica3ons for prac3cing physicians in Maine

4 Outline Current state of Maine s health care marketplace Current state of na3onal health care MassachuseQs reform and outcomes so far Maine Reform Law Poten3al impacts on physicians Discussion

5 ME Healthcare Now Cost of care Quality Insurance coverage trends Prac3ce varia3on Global payments trends Provider organiza3ons changes mergers and affilia3ons

6 ME Has the 4 th Highest Premiums Source: Wall Street Journal from CMS data

7 Quality of Care

8 NCQA Health Plan Quality Ra3ngs Of 474 Ranked Health Plans: 1. Harvard Pilgrim Health Care HMO/POS (MA, ME) 29. Anthem BCBS in Maine HMO/POS (ME) 82. Aetna Health HMO/POS (ME) 116. Cigna PPO (ME) 229. Aetna Life Insurance PPO (ME) Source: NCQA s Health Insurance Plan Rankings , Private Plans Summary

9 Insurance Coverage in Maine

10 Commercial Insurance Coverage in Maine Source: Kaiser Family Founda3on State Health Facts

11 Maine Employer- Sponsored Insurance (ESI) Coverage Source: State Health Access Data Assistance Center & Robert Wood Johnson Founda3on: hqp://www.rwjf.org/content/dam/farm/reports/reports/2013/rwjf405434

12 Maine Insurer Total Share 60% 50% 40% 30% 20% 10% 0% All Other Insurers Harvard Pilgrim Cigna Aetna WellPoint Source: 2013 Compe33on in Health Insurance: A Comprehensive Study of U.S. Markets

13 Medicaid Coverage in Maine Source: Kaiser Family Founda3on State Health Facts

14 Medicare Coverage in Maine Source: Kaiser Family Founda3on State Health Facts

15 Uninsured in Maine 30% 25% 20% 15% Uninsured US Avg 10% 5% 0% Source: Kaiser Family Founda3on State Health Facts

16 Payment and Prac3ce Varia3ons

17 Total Medicare Reimbursements per Enrollee $12,000 $10,000 $8,000 $6,000 US Avg $4,000 $2,000 $0 Burlington, VT Portland, ME Lebanon, NH Bangor, ME Manchester, NH Boston, MA * (Adjustment Type: Age, Sex & Race Only; Year: 2010; Region Levels: HRR) Source: Dartmouth Atlas

18 Physician Reimbursements per Enrollee $3,000 $2,500 $2,000 $1,500 Na3onal Avg $1,000 $500 $0 Lebanon, NH Bangor, ME Burlington, VT Portland, ME Manchester, NH Boston, MA * (Adjustment Type: Price, Age, Sex & Race; Year: 2010; Region Levels: HRR) Source: Dartmouth Atlas

19 Physician Reimbursements per Enrollee $3,000 $2,500 $2,000 $1,500 US Avg $1,000 $500 $0 Lebanon, NH Bangor, ME Burlington, VT Portland, ME Manchester, NH Boston, MA * (Adjustment Type: Age, Sex & Race Only; Year: 2010; Region Levels: HRR) Source: Dartmouth Atlas

20 Inpa3ent Back Surgery per 1,000 Medicare Enrollees US Avg Lebanon, NH Manchester, NH Portland, ME Burlington, VT Boston, MA Bangor, ME * (Gender: Male; Year: 2010; Region Levels: HRR) Source: Dartmouth Atlas

21 Inpa3ent Caro3d Endarterectomy per 1,000 Medicare Enrollees US Avg Bangor, ME Lebanon, NH Burlington, VT Boston, MA Portland, ME Manchester, NH Source: Dartmouth Atlas * (Gender: Male; Year: 2010; Region Levels: HRR)

22 Inpa3ent Days per Decedent During the Last Six Months of Life US Avg Lebanon, NH Bangor, ME Manchester, NH Portland, ME Burlington, VT Boston, MA * (Gender: Overall; Level of Care Intensity: Overall; Year: 2007; Region Levels: HRR) Source: Dartmouth Atlas

23 Global Payments Commercial Risk Arrangements Current University of Maine System & Cigna State Employee Health Commission & Aetna Maine Educa3on Associa3on Benefits Trust & Anthem Blue Cross Blue Shield Pending/Rumored Jackson Laboratories (employer) in Mount Desert Island have entered discussions with Maine Coast Memorial Hospital and Mount Desert Island Hospital, including the Maine Health Management Coali3on and Aetna MidCoast Hospital in discussions with Bath Iron Works and the Maine Health Management Coali3on Eastern Maine Health Systems working directly with the University of Maine System and Cigna on an ACO contract. Recently expanded conversa3on to include the Maine State Employee Health Commission and Maine Educa3on Associa3on Medicare ACO 1 Pioneer ACO: Beacon LLC (EMHS) 3 MSSP ACOs: Central ME ACO, ME Community ACO, MaineHealth ACO No Medicare CPCi pilot Maine PCMH Pilot Maine Health Innova3on Plan Maine Medicaid ACO Ini3a3ve Source: Maine DHHS Maine State Health Care Innova3on Plan, CMS, Maine Accountable Communi3es Concept Paper/Execu3ve Summary

24 Mergers & Affilia3ons

25 Hospital Mergers 24 of 39 Maine hospitals are members or affiliates of three systems

26 Summary of Maine Market High costs and high quality Rela3vely lowest uninsurance but high Medicaid Provider concentra3on Payment reform

27 Federal Reform

28 ACA Signed into Law ACA History House Votes to De- Fund ACA 31 Times Supreme Court Ruling Elec3on of 2012 States Decide on Medicaid Expansion

29 Good News Expanded coverage Children up to age 26 Waiver of copays for preven3ve care and immuniza3ons No life3me limits on coverage No exclusions for pre- exis3ng condi3ons Part D gap reduced, then eliminated Cap on insurer administra3ve costs

30 Bad News Income tax 0.9% on income over $200/250K Unearned income tax 3.8% over $200/250K

31 Upcoming Provisions 2013: contracep3ve coverage mandate 2014: health insurance exchanges (subsidized coverage), no gender discrimina3on, penalty for non- par3cipa3on, Medicaid expansion, small business tax credits, large employer penal3es, curb Medicare provider payments, reduced DSH payments 2015: cost and quality based Medicare physician reimbursement

32 Source: The Advisory Board Company

33 Summary of Federal Reform Major provisions (resembling MA) begin in 2014 Obamacare has survived every onslaught so far

34 MA Reform Chapter 58 of 2006 Insurance exchange Medicaid expansion Coverage mandates Chapter 288 of 2010 Quality repor3ng & standards Price and cost repor3ng Select and Tiered Networks Provider payment transparency Encourage global payments Chapter 224 of 2012 Health Policy Commission Annual cost growth GSP or less Provider registra3on Center for Health Informa3on & Analysis Expanded data collec3on and repor3ng on health plans and provider organiza3ons Expanded Powers for AG Alterna3ve Payment Methods Expanded roles for PA/NPs Health Planning Council Malprac3ce Reform

35 Effects So Far More are insured Costs have increased more than expected Access has been less of a problem than expected

36 ME Public Law Chapter 90 Ra3ng Bands Expanded Insurers may charge higher rates for older individuals & lower rates for younger individuals Insurers may charge higher rates in higher cost areas (Northern Maine & Down East) Reinsurance Program Premium Reduc3on in the Individual Market Par3ally funded by assessments on fully- insured & self- insured markets, resul3ng in increased premiums in other market segments. 2 Ra3ng Pools (closed vs. open) Can cause significant premium disrup3on, especially if merged back together in 2014 per ACA requirements. Group migra3on Lower premiums en3ce healthier individuals & the uninsured to the market Those experiencing rate increases may drop coverage Source: hqp://www.maine.gov/pfr/insurance/pl90/gormanactuarialreport.pdf

37 Situa3on and Implica3ons

38 Situa3on and Implica3ons Effect of ongoing mergers Effect of increased transparency Lack of established quality measures Effect of payment reform and new plan designs Threats from larger organiza3ons Health care reform is not finished

39 Discussion What will the future hold? Payment reform Payers Hospitals Physicians Pa3ents Employers What are your op3ons for remaining independent or not?

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