Future of Health Care: How Do You Fit In? Physician Leadership Institute February 28, 2015 Brian M. McCook, CPA

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1 Future of Health Care: How Do You Fit In? Physician Leadership Institute February 28, 2015 Brian M. McCook, CPA

2 Learning Objectives Industry Transitions Challenges and Changes ACO s Look at the Future

3 Where We Came From Fee For Service Lack of Technology and Data Silo mentality Quantity without quality

4 Where we are going Value based payments Utilization of Technology and Data Population Health Management Quality/Outcomes focused

5 Graph of Costs Medical Care and Outcomes are suboptimal

6 Challenges The best and brightest are not choosing the medical profession Liability reform is an issue Employment vs. private practice Patient engagement

7 What needs to change? New relationships between Hospitals, Physicians, insurance plans, pharmacies, employers and DME. What needs to change in the new world for physicians to be engaged?

8 Changes Compensation based on training, experience and effectiveness of physician with bonuses based on team and individual goals. Integration of team-based models Financial and clinical Utilization of clinical and administrative IT

9 Changes Physicians in Organizational Leadership Support tools and resources Employed and independent physicians Total patient engagement and experience

10 What care delivery models are available? ACO s Joint Ventures Independent Practice

11 ACOs An accountable care organization (ACO) is a healthcare organization characterized by a payment and care delivery model that seeks to tie provider reimbursements to quality metrics and reductions in the total cost of care for an assigned population of patients.

12 Why did Congress include ACOs in the law? Medicare became a prime target ACOs make providers jointly accountable for the health of their patients ACOs are projected to save Medicare up to $940 million in their first four years

13 How are ACOs paid? ACOs create an incentive to be more efficient by offering bonuses Doctors and hospitals have to meet specific quality benchmarks

14 ACOs Payment The law takes a carrot-and-stick approach by encouraging the formation ACOs in the Medicare program Providers make more if they keep their patients healthy. About four million Medicare beneficiaries are now in an ACO More than 428 provider groups have signed up An estimated 14 percent of the U.S. population is now being served by an ACO

15 ACOs Metrics Quality performance standards 37 in total at this point Physician driven Shifting towards prevention and wellness services to manage chronic diseases and keep populations healthier

16 Are ACOs the End Game? ACOs aren t the end game, says Chas Roades, chief research officer at The Advisory Board Company in Washington D.C.

17 Current ACO results In July, nearly a third of the Pioneer ACOs announced they were dropping out of that program in which providers take on the greatest financial risk. Some left because they didn t save enough money, although seven said they would participate in a second Medicare ACO model with less risk of losing money.

18 Current ACO results There were also positive developments: All 32 Pioneers succeeded in improving quality and performed better than fee-for-service Medicare in 15 quality measures, according to CMS. And they generated a gross savings of $87.6 million in 2012, the first year of the program.

19 ACO s End Game? One of the key challenges for hospitals and physicians is that the incentives in ACOs are to reduce hospital stays, emergency room visits and expensive specialist and testing services The ultimate goal would be for providers to take on full financial responsibility for caring for a population of patients for a fixed payment, but that will require a transition beyond ACOs.

20 So Where Is The Industry? Moving from Fee-for-service to Quality Based Reimbursement New Compensation Models Population Health Management Technology and Data

21 Questions

22 Future of Health Care: How Do You Fit In? Anders Health Care Services optimizes staff, resources and revenue for hospitals and physicians by offering solutions and direction to complex practice management issues. We provide an integrated approach from the financial, operational, compliance and strategic perspectives 2/12/2015 citation 22

23 Contact Information Brian M. McCook, CPA

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