ACCOUNTABLE CARE ORGANIZATIONS: MOVING FROM VOLUME TO VALUE

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Lambert Dickerson
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1 ACCOUNTABLE CARE ORGANIZATIONS: MOVING FROM VOLUME TO VALUE Brent Priday, MBA/MHSA Senior Director of Managed Care Banner Health Learning Objectives: Review new developments in Accountable Care Organizations. Describe healthcare reform and its impact on Arizona. Explain what local healthcare providers are doing to respond to today's healthcare financing challenges. DISCLOSURE OF COMMERCIAL SUPPORT Brent Priday, MBA/MHSA does not have a significant financial interest or other relationship with manufacturer(s) of commercial product(s) and /or provider(s) of commercial services discussed in this presentation. of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 1

Explain what local healthcare providers are doing to respond to today's healthcare financing challenges.

2 Banner Health Network AZ Geriatrics Fall Symposium Accountable Care Organizations: Moving from Volume to Value Current Healthcare Environment Our fiscal health is top priority 70 years of Federal Debt Held by the Public 7.9% unemployment; 160,000 new jobs in January 2% GDP growth in 2012;.1 decline in January Federal spending 23% of GDP; Tax of GDP 2001 Debt = 33% of GDP; 2013 projected debt = 75% of GDP of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 2

9% unemployment; 160,000 new jobs in January 2% GDP growth in 2012;.

3 HEALTHCARE SPENDING PER CAPITA & LIFE EXPECTANCY Drivers of Change: Changing Health Care Landscape Health Care Reform Evolution CMS estimates of 10,000 new beneficiaries daily ACO regulations Expanded bundled payment pilots Arizona State Budget AHCCCS Impact Commercial Payer Changes Affordability concerns (less than 50% of employers offer health insurance) Increased levels of value transparency to inform consumers Banner Health Snapshot 23 Acute Care Hospitals Banner Health Network Banner Medical Group with more than 1,000 doctors Banner Health Centers and Clinics Behavioral Hospital Outpatient Surgery Medical Education $4.9 billion in revenue 36,700 employees AA- bond rating of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 3

levels of value transparency to inform consumers Banner Health Snapshot 23 Acute Care Hospitals Banner Health Network Banner Medical Group with more than 1,000 doctors Banner Health Centers

4 Banner Health Network (the ACO) Banner Health Recognitions Truven Top 5 Health System in U.S. (3 of past 4 years) Top Leadership Team in Healthcare (HealthLeaders Media) Top 10 Integrated Health Network in U.S. (SDI) 21 Banner facilities achieved Stage 7 EMR (of 92 hospitals in U.S. (by HIMSS Analytics) Most Wired Award (Hospitals & Health Networks) Best Places to Work (Az. Business Magazine) Growing number of ACOs nationwide 252 Medicare ACOs in 43 states Over 430 Medicare and Commercial ACOs 500 providers in CMS Bundled Payment initiative of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 4

S. (by HIMSS Analytics) Most Wired Award (Hospitals & Health Networks) Best Places to Work (Az.

5 Expending Yea r ACO Shared Savings Model ACO Launched Projected Spending Confidence interval SharedSavings Actual Spending Source: Lewis, Julie. What Could be Next for Health Reform? The Debate In Washington Presentation. The Dartmouth Institute for Health Policy & Clinical Practice Value Proposition in an ACO Type Model while increasing quality and member experience Patient Centric Care. Health Management Solutions Onsite Services Applications Disease Management Banner Brand Awareness Consumer Employers Payers Individuals Tele health Provider Network Wellness & Health Coaches Health Centers Access & Value of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 5

Value Proposition in an ACO Type Model while increasing quality and member experience Patient Centric Care.

6 Health Home Team Based Care CURRENT MODEL Physician Centric Sickness Model Reach ~ 35 patients/day Types of interactions PCP 1:1 clinic visits Reactive Phone Follow Up Follow Up Population Health Management FUTURE MODEL Member Centric Wellness model Reach ~ 100 members/day Types of interactions PCP 1:1 clinic visits Reactive Phone Follow Up Follow Up PCP group visits Clinic team member 1:1 visits Clinic team member group visits Proactive Chart Reviews Proactive outreach Snail Mail Phone Text Other BHN at a Glance Clinical Consensus Groups (CCG) of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 6

visits Reactive Phone Follow Up email Follow Up PCP group visits Clinic team member 1:1 visits Clinic team member group visits Proactive Chart Reviews Proactive

7 Evidence Based Practices Medical Imaging for Dx Community Acquired Pneumonia Chlorhexidine Alcohol for Surgical Skin Preparation Seprafilm Use in Cesarean Sections Knee High SCDs and TEDs Early Sepsis Identification Acute Respiratory Distress Syndrome (ARDS) Delirium Newborn Hypoglycemia Screening & Mgmt Medical Imaging for Peds Appendicitis Large/Small Bowel Surgical Care Diagnosis of Diarrheal Disease Pooling of Bronchoscopy respiratory specimens Diagnosis of Coccidioidomycosis by Seriological Means Diagnosis of Clostridium difficile Associated Diarrhea Elective Deliveries Prior to 39 Weeks Behavioral Health Medical Clearance Ventilated Patient Management (oral care, sedation) CT Scan in ED for Atraumatic Headache Dysphagia Management for peds patients Subcutaneous Insulin Syncope ED Ischemic Stroke tpa Scorpion Envenomations ED to Critical Care Admissions Intra Op Goal Directed Therapy PET Scan Admin Intravenous Contrast Media Vertebroplasty Pre Term Labor Ambulatory Lower Back Pain Insulin Drip Transition Post Cardiac Surgery Palliative Sedation Readmission Risk Assessment and Management Pediatric Sepsis Enhancing Progression of Labor Indwelling Catheters in Laboring patients Pharmacy Drug Level/Lab Monitoring Service Appropriate Use of PPI s (Proton Pump Inhibitors) DKA Hyperglycemic Crisis Moderate Severe EtOH Substance Withdrawal Pediatric Bronchiolitis Pediatric Fevers Adult Implantable Automatic Cardio Defibrillators (ICD s) Epoetin Adult Orthopedic Care for Total Knees, CPMs, Cold Therapy Anesthesia Administration Post Partum Hemorrhage Early Warning System for Adult Patients ED Pulmonary Embolism Rule Out Criteria (PERC) ED Discharge Transition ED Acute paint management Midline Sternotomy Post Operative Management Adult Point of Care Chest Ultrasonography Chorioaminonitis Management Developmental Screening for Peds Acute Blood Loss ED Chronic Pain T Dap Vaccine Use of BMP Nitrous Oxide Reducing Postoperative Pulmonary Complications Ambulatory Diabetes Care Hepatic Encephalopathy Patient Management ED CT Scans Atraumatic Headache Initiative Started July 2011 target Mortality Observed/Expected Acute Care Patients Mortality outcomes are >50% better than predicted Clinical Practice: Severe Sepsis Delirium of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 7

Diarrheal Disease Pooling of Bronchoscopy respiratory specimens Diagnosis of Coccidioidomycosis by Seriological Means Diagnosis of Clostridium difficile Associated Diarrhea Elective Deliveries Prior

8 Patient Acuity Case Management Model Resource Demand Case Management Practice Settings There is a single, standardized model for Case Management; the setting varies. A standardized process requires standardized assessment tools, action plans, and workflows. Supporting programs are developed that support and mimic the standardized approach to case management (IAC and Bundled Payment). Patient Registry of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 8

A standardized process requires standardized assessment tools, action plans, and workflows.

9 Case Management Programs Program Description Case manager, RN, and/or MSW monitor and manage medically complex members, assist with care coordination, disease Complex Case management education, and community services. ECM is practice focused to collaborate with Providers at High Embedded Case Management Volume Primary Care offices Readmission Reduction Program 65+ CHF, AMI, Pneumonia and 18+ all cause Management Internists working in tandem with nurse case managers provide medical, preventative, educational, and supportive services to Clinic Without Walls stabilize symptoms and slow disease progression. Case Managers help members initiate infertility benefit, guide to designated providers, and provide counsel through diagnostics Infertility Case Management and the treatment Moms with high risk pregnancies and sick neonates are offered access to specialized care networks and benefits customized to Maternal Child case Management facilitate optimal outcomes. Case Managers help manage high rsik pediatric patients, guide to designated providers, and provide counsel through diagnostics Pediatric Case Management and the treatment Members with declining or failed kidney functioning are assigned a renal case manager who helps the individual make informed decisions regarding method of dialysis, access selection, and End Stage Renal Disease (ESRD) transplant timing. The case manager monitors efficacy of dialysis, Case Management and educates members Co management with Optum case manager helps with selection of Transplant Case Management transplant facility. Clinical pharmacists evaluate and advise regarding medication regimens, members are taught to understand their medications and take appropriately. Information also available on potential Medication Management resources to preserve benefit or help offset cost Declined/UTR In CM Impact on Inpatient Admissions/K 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 Case Management Results Impact on ER Visits/K Declined/UTR In CM 2012Q1 2012Q2 2012Q3 2012Q4 2013Q Impact on Physician E&M Visits/K Declined/UTR In CM Linear (Declined/UTR) Linear (In CM) 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 R² = Initial views show reductions in Allowed PMPM of the CM Managed Population Initial estimates for savings per engaged case (from a comparative health plan s programs) $555 Advance Illness Planning $103 for CM CM Managed Population Average PMPM $1855 (1Q12 4Q12) Impact on Allowed PMPM Estimated Savings per Engaged Case Paid thru April % completion factor applied to 1Q13 derived from Aetna AZ MA of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 9

ECM is practice focused to collaborate with Providers at High Embedded Case Management Volume Primary Care offices Readmission Reduction Program 65+ CHF, AMI, Pneumonia and 18+ all cause Management

10 Pioneer ACO First Year Results 8.9% reduction in overall hospital admissions 14.4% reduction in average length of stay 6.0% reduction in avoidable hospital readmissions 6.7% reduction high tech imaging services 2.53% reduction in CMS paid amount per beneficiary Pioneer ACO Financial Performance % 5% 0% -5% -10% Health Care Exchange Update of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 10

53% reduction in CMS paid amount per beneficiary 16 25 15 123 Pioneer ACO Financial Performance 12 24 32 3 30 18 28 22 26 9 2

12 Winning under reform Critical success factors High quality; reduce costs Ability to aggregate clinical capabilities and deliver evidencebased care Brand Access to capital Ability/partner to aggregate lives Physician / Hospital alignment Ability to aggregate and analyze data Ability to engage consumers Manage transition with one foot in FFS and stepping into riskbased contracting Ability to manage performance risk Understand/partner on benefit design of the Arizona Geriatrics Arizona Geriatrics All Rights Reserved 12

and analyze data Ability to engage consumers Manage transition with one foot in FFS and stepping into riskbased contracting Ability

Benefit Summary - A, G, C, E, Y, J and M

Benefit Summary - A, G, C, E, Y, J and M Benefit Year: Calendar Year Payment for Services Deductible Individual $600 $1,200 Family (Embedded*) $1,200 $2,400 Coinsurance (the percentage amount the Covered