Building an Accountable Care Organization: Challenges and Successes in an Academic Healthcare System

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1 Lessons From The Physician Group Practice Medicare Demonstration Building an Accountable Care Organization: Challenges and Successes in an Academic Healthcare System Caroline S. Blaum Dave Spahlinger Steve Bernstein Jean Malouin Jack Billi

2 Accountable Care Organizations (ACO) Healthcare reforms includes provisions for establishing Accountable Care Organizations for Medicare ACO s are organized provider groups, including physicians, hospitals, and post acute providers, responsible for healthcare of a population Debate continues regarding key design elements Provider organizational structures (anti trust issues) Payment and risk/savings sharing mechanisms Quality and efficiency criteria CMS is leading the way (bipartisan) Other insurers are close behind

3 Factors that Influence Success of an ACO Market Characteristics Financial Model Patient attribution and risk models Provider Structure and Organization Health Information Technology Clinical interventions related to quality and efficiency performance

4 The Physician Group Practice (PGP) Demonstration: A Model for Accountable Care Organizations From , UMFGP was one of 10 large physician groups that participated in the Physician Group Practice (PGP) Medicare Demonstration It is one of the few successful Medicare Demonstrations UMFPG and one other group achieved shared savings every year; five groups achieved shared savings by year 3 All groups improved quality of care All groups had similar clinical and quality interventions Groups achieve integration and coordination with different structures Starting 1/1/11, UMFPG and other groups began participating in PGP Demo version 2

5 The PGP Demonstration was Medicare s first Pay for Performance Demonstration for Physicians Widely seen as a model for ACO s Designed for large group practices and fee for service Goals: Cost reduction Care coordination Quality improvement 3 Year Demonstration* Base Year Jan 1, 2004 Dec. 31, 2004 PY 1 Apr 1, 2005 Mar 31, 2006 PY 2 Apr 1, 2006 Mar 31, 2007 PY 3 Apr 1, 2007 Mar 31, 2008 PY 4 Apr 1, 2008 Mar 31, 2009 PY 5 Apr 1, 2009 Mar 31, 2010 Shared savings accrue to UMFGP for decreasing Medicare costs IF quality targets are met Fee for service reimbursement unchanged

6 PGP Participants Geisinger Clinic (PA) Marshfield Clinic (WI) The Everett Clinic (WA) Forsyth Medical Group (NC) St John s Health System (MO) University of Michigan Faculty Group Practice Deaconess Billings Clinic (MT) The University of Michigan (MI) Dartmouth Hitchcock Clinic (NH) Park Nicollet Health Services (MN) The The ten ten participating physician groups represent: 5,000 5,000 physicians physicians and and 224, ,000 Medicare Medicare fee-forservice fee-forservice beneficiaries. beneficiaries. Integrated Resources for Middlesex (CN)

7 Financial Model: Reduce Medicare Growth Model depends on decreasing growth, not cost Model involves: Attribution of assigned patient population Case mix (risk) adjustment based on claims diagnoses Earn back requires cost savings. Amount is based on combination of cost savings and quality. Cost/quality weighting: Year 1 = 70% / 30% Year 2 = 60% / 40% Years 3, 4, 5 = 50% / 50%

8 Quality Reporting Requires yearly reporting on multiple ambulatory clinical quality indicators. Report on diabetes, CAD, HF, hypertension and prevention Reporting requirement consists of: 32 measures, 7 are claims based

9 32 Quality Measures University of Michigan Faculty Group Practice Diabetes Mellitus Congestive Heart Failure Coronary Artery Disease Preventive Care HbA1c Test 4 HbA1c < 9% 1 Blood Pressure < 140/90 Left Ventricular (LV) Assessment LV Ejection Fraction Testing 1 Weight Measured 1 1 Antiplatelet Therapy 1 4 Antihyperlipidemic Therapy Beta-Blocker Therapy: Prior MI LDL Test 4 Blood Pressure Measured 1 Blood Pressure Measured 1 LDL < Patient Education 1 Lipid Profile Blood Pressure Measured Blood Pressure < 140/90 Care Plan if elevated BP Breast Cancer Screening Colorectal Cancer Screening Urine Protein Testing 4 Beta-Blocker Therapy 1 LDL < Eye Exam 4 ACE-I (inhibitor) Therapy 1 ACE-I if diabetes or LV systolic Foot Exam 1 Warfarin - atrial fibrillation 1 dysfunction Influenza Vaccination 1 Influenza Vaccination 1 Pneumonia Vaccine 1 Pneumonia Vaccination 1 TOTAL Points

10 Why Did UM FGP Decide to Participate? Develop provider based care coordination and quality interventions Develop skills for population management for cost and quality Had some key strengths experience with managed care and collaboration with payers and large employers Prepare for Value Based Purchasing in Medicare and other payers Collaborate across specialties; with hospital; throughput Collaborate with 9 leading physician groups & CMS Possible financial returns from CMS shared savings model

11 PGP Demonstration Earned Payments for Efficiency and Quality Since the demonstration began, UM has: Been successful each performance year in earning shared savings Saved the Medicare Program over $12 million Earned shared savings of over $6.5 million PGPs PGPs Earning Earning Shared Shared Savings Savings (to (to date) date) PY1 - (2) Marshfield Clinic PY1 - (2) Marshfield Clinic University of Michigan University of Michigan PY2 - (4) Dartmouth-Hitchcock, PY2 - (4) Dartmouth-Hitchcock, The Everett Clinic, The Everett Clinic, Marshfield Marshfield University of Michigan University of Michigan PY3 - (5) Dartmouth-Hitchcock, PY3 - (5) Dartmouth-Hitchcock, Geisinger, Geisinger, Marshfield, Marshfield, St. John s Health System, St. John s s Health System, University of Michigan University of Michigan

12 Strategies to Achieve Financial Goals Decrease preventable admissions, manage chronic conditions, and coordinate care of complex and costly patients Transitional care interventions Care coordination interventions for patients with chronic diseases and psychosocial problems Population based management of complex patient groups in feefor service environment Frail elderly Chronic diseases Dual eligible / disabled / mental illness ESRD / transplant / palliative care

13 Interventions to improve ambulatory care quality Multi payer chronic disease registries Diabetes, CAD, Heart Failure Assess quality; identify gaps in care Provide just in time actionable, patient specific quality gap reports for physicians Modified delivery system to improve care Modify electronic medical record to facilitate care Use computers to improve care

14 Challenges of the PGP Medicare Demonstration Financial model Retrospective reconciliation; no infrastructure support Growth model: regional vs. national comparison Impossible to know how we are doing Attribution methodology Referral patients often assigned Attributed patients identified late Academic Medical Center Referral patients Competing missions clinical care, research, teaching Tertiary/quaternary care

15 University of Michigan Health System is a referral center Substantial implications for attribution, risk and financial models of ACOs Fewer than half of Medicare patients seen can be attributed as continuing care patients Fewer than half of Medicare patients seen have primary care at UM Patients have complex and costly problems Adverse selection both medically and socioecomically cannot be fully accounted for in risk or financial models

16 Old financial model Growth model Regional comparison 2% threshold 80% shared savings Baseline year Sophisticated risk adjustment (HCC s) Patient attribution based on ambulatory care Retrospective attribution New model Growth model National comparison 95% confidence interval 50% shared savings 3 year rolling avg. for baseline Risk adjustment changed but still based on HCC s Attribution same for UM but based on primary care for other groups Retrospective attribution Massive increase in quality reporting requirements

17 PGP Medicare Demonstration Project as Prototype ACO Can a PO (or PHO) Do What the UM Faculty Group Practice Did? An Integrated Approach to Population Based Delivery Jack Billi, MD University of Michigan Health System

18 University of Michigan Health System Is this any match Executive VP Medical Affairs Michigan Health Corporation Hospital and Health Centers Medical School / Faculty Group Practice

19 For this????? Older patients experience complex care Hospital Disease Mgmt Pharmacy Family Caregiver Home Care Physicians Nursing Home

20 Multiple Clinical Interventions Sub Acute Sub Acute Care Care Gen Med Transition Clinic Post Discharge Calls Michigan Visiting Nurses MVN MVN House House Calls Calls ED Consult/ Referral Complex Complex Care Care Do all these people have to be relatives??? Social Work BOOST Geriatrics Consult Service Geriatrics Geriatrics Palliative Palliative Care Clinic Care Clinic Geriatrics Geriatrics Transitional Transitional Clinic Clinic Palliative Care Palliative Care Consults Consults

21 Common Patient Transitions Emergency Department Home, Assisted Living, Nursing Home Hospital Sub acute nursing home Home or Assisted Living Home or Assisted Living Hospital Nursing Home Who will build these bridges???

22 What kind of organizations can do this? Structure is not the answer Power or control is not the answer Size is not the answer Do you have agreement? On the vision? On the problems? On their owners? On their root causes? On which experiments to try first?

23 Most Frequent Adult High Level Patient Journeys Who owns the problem?? Acute Medical (unscheduled) Ambulatory MOU Primary Care ED Medical Inpatient Home or ECF Medical Clinics Surgical Clinics ORs Surgical Inpatient Home or ECF Surgical (scheduled)

24 Lean Thinking everyone a problem solver Do our work every day in a standard way that we created Not just the way the work evolved! Be alert to things going wrong They always do! Fix the problem now For this patient or co worker Find and fix the root causes of the problem So it never happens again! Modified after Spear; Billi Solving problems: 1. Go and See 2. Ask why 3. Respect people Fujio Cho 24

25 Limits of authority as a problem solving model If that person only reported to me, we d fix this Clarity and agreement are often missing: Which problem are we working on? Who owns the problem? The owner builds consensus on the problem, its causes, which experiments to try first. Pull based authority Pull what you need to solve the problem Manufacture authority through building consensus

26 Value Stream Mapping and A3s: Learning to See Ah ha moments: I never knew this is how it worked! I can t believe what a mess this process is! No wonder we re frustrated! It s a miracle a patient ever gets through it!

27 Lean Learning Collaboratives in Michigan PGIP Lean For Clinical Redesign CQI PGIP Lean Learning Collaboratives UM/IHA/St Joes; West MI, MAG/CIPA Keystone Emergency Department Save Lives Save Dollars (GDAHC) ED utilization These can expand to help build ACOs

28 Lean, CQI, PGIP, ACO Resources Michigan Quality System: med.umich.edu/mqs ; sitemaker.umich.edu/jbilli Healthcare Value Leaders Network (national lean learning collaborative): healthcarevalueleader.org Lean Enterprise Institute: lean.org Ideal Patient Care Experience at UMHS sitemaker.umich.edu/jbilli/ideal_patient_care_experience_ _quality_chasm BCBSM Value Partnerships: valuepartnerships.com Physician Group Incentive Program (PGIP): bcbsm.com/provider/value_partnerships/pgip PGIP Lean for Clinical Redesign CQI: bcbsm.com/pdf/pgip_fs_lean_cqi.pdf bcbsm.com/newsletter/pgip/pdf/110909_lean.pdf MI Anticoagulation Quality Improvement Initiative: valuepartnerships.com/programs/hospital09.shtml MI Quality Improvement Consortium: mqic.org

29 Medicare Demonstration Project Team UM Caroline Blaum Steven Bernstein Kathy Ward David Spahlinger Vinita Bahl Jack Billi Tim Laing Sam Silver Brent Williams Donna Fox Kathy O Dell Charlie Whiting Scott Flanders Jean Schlafer Paul Walker Todd Koelling Diane Griffths Phil Rodgers Cheryl Grostic Many others CMS John Pilotte Heather Grimsley Medicare claims data available through a Data Use Agreement between CMS and the University of Michigan RTI Gregory Pope Mike Trisolini

30 Contact Information Caroline S. Blaum, MD, MS Associate Chief, Division of Geriatric Medicine Lead, CMS PGP Demonstration Project University of Michigan Phone: (734)

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