Build a Clinically Integrated Network

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1 Build a Clinically Integrated Network Create a Sustainable Future For your PHO/IPA April 25, 2013

2 Our Speaker Lori Fox Ward, SVP Clinical Integration has worked with Valence Health since Lori oversees development, implementation and ongoing management of FTC compliant clinical integration programs for Valence customers. She also specializes in the selection and adoption of clinical guidelines and protocols for inclusion in these programs. Lori is a registered nurse with a Bachelor of Science in Nursing from the University of Iowa. With more than 20 years of experience in the healthcare industry, Lori has expertise in clinical integration, program design and implementation, project management and medical management. 2

3 Valence Health Overview > Providers should be in charge, clinically and financially > Technology-enabled services since 1996 > Serve IDNs, IPAs, PHOs, ACOs > Serve 30,000 physicians, 100+ hospitals > Support 15 million patients > 50 million member months in analytics and services > 75% growth in 2012 > 300 employees, 4 offices P4P Shared Savings Bundled Payments Shared Risk Full Risk Health Plan 3

4 The Health Care Landscape Source: PwC 4

5 Definition of Clinical Integration > In the words of the Federal Trade Commission:... an active and ongoing program to evaluate and modify practice patterns by the network's physician participants and create a high degree of interdependence and cooperation among the physicians to control costs and ensure quality... This program may include: (1) establishing mechanisms to monitor and control utilization of health care services that are designed to control costs and assure quality of care; (2) selectively choosing network physicians who are likely to further these efficiency objectives; and (3) the significant investment of capital, both monetary and human, in the necessary infrastructure and capability to realize the claimed efficiencies. Source: Statement of Antitrust Enforcement Policy, DOJ/FTC, August

6 Objectives of Clinical Integration > Establish a network of providers that enables enhanced coordination of care > Create a new partnership model with employed and independent physicians that includes defined roles for physician leadership > Define performance improvement initiatives to provide demonstrated value to the market > Provide a platform for joint contracting to support care redesign and performance improvement initiatives > Create a model for success under value-based (risk) contracts > Satisfy FTC requirements > Avoid the cost of acquisition 6

7 Organizations Must Be Physician-Led Requires deep integration of providers > Physicians are the main players in healthcare & organizations need to understand their needs 7

8 Clinical Integration Checklist Adapted from Dixon Hughes Goodman Oct

9 Legal Analysis and Options > Utilize up-to-date FTC and DOJ guidance > Organize in a structure that supports program objectives Physician-Hospital Organization Independent Practice Association Subsidiary of the Health System > Each legal option is capable of achieving clinical quality + financial objectives though differ in ownership structure and capitalization requirements > Example- some hospitals and physicians already have a PHO or IPA in place and are using those entities as the foundation for their CI programs 9

10 Physician Governance Create a Winning Team > Physicians and hospitals need to play nice in the sandbox > Allow physicians to guide the development of care strategies and clinical protocols > Diversify clinical integration governance committee and include physicians that represent different perspectives > Identify leaders and champions in the community > Include the difficult physicians 10

11 Conditions of Participation > Member physicians or groups in the CI network must sign a participation agreement > Critical that members adhere to guidelines > Physicians must be active participants in program activities > Ensure that stated objectives are met and that network s value proposition is able to be demonstrated to the market 11

12 Quality & Performance Measures > Clinical quality and operational improvement projects are necessary components of a CI program > Defines how quality is measured; adopt and promote EBGs > Allows physicians to take an active role in care redesign and protocol development to: Increase quality More effectively manage costs Reduce variation and eliminate unnecessary waste Improve care delivery at the local level > Performance initiatives span across specialties and sites of care 12

13 Quality and Performance Measures 13

14 Clinical and Financial Integration Portal 14

15 Clinical and Financial Integration Portal > Ability to analyze quality, utilization and cost > Access to actionable real-time data across entire network is essential 15

16 Integration Portal: Compliance Guideline Compliance Report 16

17 Integration Portal: Physician View 17

18 Integration Portal: Patient Profile Patient Summaries 18

19 Integration Portal: Disease Management Disease Registry 19

20 Integration Portal: Population Management Population Management Population Snapshot Management Snapshot Population Management Snapshot Compliant TCOC / TCOC / TCOC / Non- Patients Compliant %age Patient Compliant Compliant Colorectal Cancer Screening 1, Compliant 23% $ TCOC / 6,012 TCOC $ / 4,810 TCOC / $ Non- 6,371 Patients Compliant %age Patient Compliant Compliant Diabetes Management % $ 5,904 $ 4,723 $ 6,951 Colorectal Cancer Screening 1, % $ 6,012 $ 4,810 $ 6,371 Diabetes Screening 1, % $ 4,224 $ 3,379 $ 5,864 Diabetes Management % $ 5,904 $ 4,723 $ 6,951 Heart Failure Diabetes Management Screening 211, % 40% $ $ 4,224 14,916 $ $ 3,379 11,933 $ $ 5,864 16,905 Hypertension Heart Management Failure Management % 50% $ $ 14,916 4,944 $ $ 11,933 3,955 $ 16,905 $ 5,933 Lipid Screening Hypertension Management 1, % 40% $ $ 4,944 3,984 $ $ 3,9553,187 $ $ 5,933 4,515 Lipid Screening 1, % $ 3,984 $ 3,187 $ 4,515 $18,000 $18,000 $16,000 $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 TCOC / Compliant TCOC / Compliant TCOC / Non-Compliant TCOC / Non-Compliant $2,000 $- $- Colorectal Cancer Screening Colorectal Cancer Screening Diabetes Management Diabetes Management Diabetes Screening Diabetes Screening Heart Failure Hypertension Management Management Heart Failure Hypertension Management Management Lipid Screening Lipid Screening 20

21 Contracting Options & Rewards for Value > Although the sole purpose for creating a CI network is not negotiating better rates with payers--- CI Networks are rewarded for demonstrated value > VALUE = the highest quality care at the lowest cost > Able to contract with payers and employers (including health system) > Arrangements range from specific procedure to population of patients 21

22 Reward For Performance > Examples of contracting models that reward for performance: Enhanced base rates- increased fee-for-service rates based on expected performance Performance incentives- incentive payments made for performance improvement initiatives Shared savings- savings shared based on a reduction in the cost of care 22

23 Incentive Alignment > Calculation and distribution of CI incentives to physicians and to the health system occur after performance is achieved Realized through cost savings Quality and efficiency programs negotiated > Funds distributed based on meeting performance objectives and can be defined in a variety of ways > Distribute rewards based on measurable performance > Reduce complexity of distribution methodology > Increase transparency across network 23

24 Aligned Incentives: Action Steps > Pay for performance incentive plan > Healthcare is regional so its important for physicians to help set criteria > Consider individual and group incentives > Takes a team to care for patients > Set tangible measureable targets > Use what you have > National Benchmarks > Baseline clinical outcomes > Patient safety > Patient satisfaction scores > Research Findings > Develop new measures > Outcomes > Efficiency > Regionalized > Attributable > Constantly reassess measures for appropriateness and measurability 24

25 Incentivizing Change Align Incentives Program Assumptions: Modify compensation to reward desired outcomes Compensation must be altered for a significant portion of a practice for physicians to take notice Incentives should mimic what your are trying to accomplish at each phase 25

26 Aligned Incentives: Use of IT Tools > Get doctors accustomed to looking at reports > Give them actionable tools that help today s practice > Pay them to attend training > Pay them to use CPOE > Pay for EMR/E-prescribing adoption > Begin to pay for performance improvement + meeting quality targets 26

27 Next Steps 27

28 28

29 To learn more about Valence Health s capabilities, Contact: Lori Fox Ward at or 29

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