Concurrent Session 2.3. Building an ACO Framework: Opportunities and Challenges for Providers and Hospitals. Dr. Edward G.

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1 Concurrent Session 2.3 Building an ACO Framework: Opportunities and Challenges for Providers and Hospitals Dr. Edward G. Murphy Chairman Amin Neghabat SVP, Business Development 1

2 Introduction Sound Physicians, Chairman o Hospitalist Organization focused on Performance Management Radius Ventures o Private Equity / Venture Capital 25 years health system CEO experience o 13 years at Carilion Clinic 8 hospitals, 700 provider group Professor, Department of Medicine o Virginia Tech, Carilion School of Medicine AMA: Advisory Committee on Professional Satisfaction o Care Delivery and Payment National Committee Quality Assurance (NCQA) o HEDIS o Medical Home 2

3 Accountable Care Organizations Two Questions: 1. Accountable to who? 2. Accountable for what? 3

4 Accountable Care Organizations 1. Accountable to who? Patients Community o Ultimately payors 4

5 Accountable Care Organizations 2. Accountable for what? Outcomes Services Costs o i.e. making them lower 5

6 Costs Cost reduction is the key driving force behind ACO advocacy. Total cost of care: The all in per capita cost of treating a population for a year. 6

7 Costs 7

8 ACO Value Thesis Redundancy Lowest Cost Setting Unnecessary tests and procedures Longitudinal management of patients with chronic diseases. Hospital Quality ED Care Surgical Outcomes Infection Rates Missed Diagnosis 8

9 Significant Business Model Conflict Health care is a volume driven, transaction oriented business. ACO s are a care management / efficiency value proposition. We re set up to deliver services not manage care. 9

10 Cost Savings Opportunities Pharmaceuticals Hospital admissions E.D. Usage Procedures Ancillary services, esp. high cost imaging (e.g., C.T.) 10

11 ACO Success Requires execution on a whole new body of work / new competencies Case management Largely the work of physicians and physician support personnel / services 11

12 ACO Hospital Care Home Care Physician Group Primary Care Foundation Medical Home Emergency Care Imaging Everyone is important but physician group is at the center. 12

13 National Health Expenditures by Type of Services, 2010 &

14 Hospitalists Will Play a Key Role 14

15 Hospitalist Penetration in the US More than 30,000 hospitalists Practicing in more than 3,300 hospitals 80% of hospitals >200 beds have a hospitalist program Average size of a hospitalist program >9.2 hospitalists 15

16 How Hospitalists Can Help Take a performance based approach Providers are taking on the risk now, so Must deliver care more efficiently Must improve outcomes to reduce overall costs Not just about revenue any longer 16

17 Our Vision: Accountable Acute Care Services PAT Hospitalist Decision Unit Concurrent Peer Review Re-Admission Prevention Core Hospitalist Service Post-Acute Service Acute Continuum ED Triage Admit Elective Transition Inpatient DC Post Acute Rehab PCP Value Proposition Appropriate care setting, avoid unnecessary admissions Evidence based, efficient inpatient care best outcomes Superior patient and physician experience Managed transitions, avoided re admissions 17

18 Focused Care Team Model 18

19 Preventing Avoidable Admissions No Does patient require treatment that can ONLY be provided in a hospital setting? Yes No Can patient be evaluated/treated within 24 hours and/or is rapid improvement of patient s condition anticipated within 24 hours? Yes Alternate level of care is appropriate, including Sound s post acute physician model and hospital at home Inpatient admission is appropriate Obs patients are automatically flagged in SoundConnect Observation is appropriate 19

20 Hospitalist RN Role Delivery of Clinical Models of Operation (85%) Practice Management (15%) High Impact Diagnoses Core Measures Patient Satisfaction Readmissions Management Transition of Care Custom initiatives Hospital committee participation Quality Throughput, utilization EHR implementation Nursing Forums Special projects 20

21 Reducing Costs and Bed Days High-Level Workflow: High-Impact Diagnoses Admission SoundConnect Interventions at the bedside Physician admits patient Patient is identified based on primary diagnosis Rounding list is generated HRN Workflow Applied Variances from best practice documented and addressed Rounding list is accessed Pharmacy intervention applied Discharge Facilitation intervention applied Intervention tracking in SoundConnect is updated 21

22 Reducing Pharmacy Costs Pharmacy communication tools designed to reduce costs and improve quality 22

23 Reducing Length of Stay Physicians or Hospitalist RN enter anticipated discharge date and document avoidable days Anticipated Discharge List Page 1 of 1 Room Patient Team Physician Comments IOF2 Patient A Blue Dr. A 10/07/ :58 Possible tx to university Patient B Green Dr. B 10/07/ :11 Hospice consult at 1200, possible dc home with hospice later 10/7 or 10/ Patient D Purple Dr. A 10/05/ :23 Possible dc 10/5 or 10/6 depending on sx control, fever, etc Patient E Purple Dr. B 10/07/ :15 Palliative care consult 10/7, possibly back to sunny acres 10/7 or 10/ Patient G Blue Dr. A 10/07/ :55 DC 10/7. Follow up to discharge ratio tracked by physician vs. team Patient I Red Dr. C 10/07/ : Patient J Purple Dr. A Anticipated Discharge Hope to List dc to SNF. distributed to Case Anticipated Discharge List distributed to Case Management, Nursing and others each morning 23

24 Prospectively Managing Quality SoundConnect Quality Measures Review Reduces fallouts and drives interventions, while the patient is still in the hospital 24

25 Reducing Readmissions Admission Inpatient Stay Discharge Post Discharge Autoflag High Readmission Risk Patients Diagnostic Chart Review if readmission within 90 days Teach Back Patient/Caregiver Education Enhanced Transition of Care Care Team Alert Discharge Readiness Assessment PCP Notification Schedule Follow up Appt within 7 Days Call Center Follow-Up within 72 hours Follow-Up Appointment Medications Discharge Instructions If Red Flag Apply Intervention(s) Additional Follow up within 48 Hours 25

26 Existing Payment System is a Major Impediment. 26

27 Two BIG Problems with Current Payment System 1. Patient management activities difficult to get into billing codes Case Management Health Educator Electronic Visits Risk of INCREASED COST and NO PAYMENT. 27

28 Two BIG Problems with Current Payment System 2. Success causes financial injury Services on the priority list for cost savings o Hospital Admissions o ED Usage o High End Imaging o Procedures 28

29 To make ACO s work we need: 1. A new payment system AND 2. A new relationship with payors 29

30 Carilion started six years ago 1. Clinic Conversion Organizational Structure Leadership Physician Compensation 2. IT Platform EPIC 3. Insurance Strategy M.A. Plan Aetna 30

31 Physician Compensation Link pay to what you value. Productivity is essential but.. Medicine is more than an endless stream of billable events. 31

32 Physician Compensation Link pay to what you value: Quality Service/Patient Satisfaction Citizenship Etc. 32

33 Why would any sane person do this voluntarily? (Better care aside.) 33

34 Must assess ACO s against your assessment of the Status Quo as a practical alternative. 34

35 Medicare (Federal Budget) SGR Hospital payment rates Readmissions Quality based purchasing Bundled payments Efficiency Measures Medicare spend per beneficiary 35

36 Medicaid (State Budgets) Commercial insurance Wellpoint contracts 36

37 How long have we got? 37

38 How long have we got? 38

39 Summary ACO s: Potential for high patient and societal value but A very complicated transition. 39

40 Summary Thank you! 40

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