Medical Home in the Context of ACOs, Healthcare Reform and the New Payment Environment

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Walter Anthony
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1 Medical Home in the Context of ACOs, Healthcare Reform and the New Payment Environment Six Simple Rules For Successful Organizations In The New Payment Environment Bruce Bagley, M.D. Session Objectives Start with a quick reality check about the current state of affairs Discuss alternative payment models Six simple rules that t will enable ACOs to work well A few points about PCMH capabilities 2 The current payment structure is unsustainable and almost everyone now realizes that fact. FFS drives volume over value Fosters fragmentation of care No one wants to stop while it is still working for them RBRVS, SGR, PC-Specialty pay gaps 3 1

Session Objectives Start with a quick reality check about the current state of affairs Discuss alternative payment models Six simple rules that t will enable

2 How Physicians Are Paid Matters Basic Payment Method Salary Fee for Service Capitation Pay for performance Potential Pitfalls Productivity it Overuse Under use Decreased effort on care not being measured 4 Changes to the E & M codes through the RBRVS system or the conversion factors are NOT payment reform 5 Funding With Shared Savings Has Issues Most financial benefit accrues to those who are currently inefficient Relatively short term incentive Some of the potential ti savings should be used to increase the base for primary care Basically P4P NOT payment reform Proposed Medicare ACO shared savings program is flawed 6 2

Funding With Shared Savings Has Issues Most financial benefit accrues to those who are currently inefficient Relatively short term incentive Some of the

3 Transition Strategy Required Moving to a new payment model will take time to adjust deep seated habits and beliefs There will be winners and losers, both will need time to adapt to changing incentives Some will not do well in the long run because of failure to adapt Potential Primary Care Payment Models Blended payment Global payment -Risk adjusted comprehensive primary care payment-(goroll model) Episode payment -Evidence informed case rate bundled payment-(prometheus) Salary- Associate with group in an employed status Others-CMS ACO Shared savings and CMS Center for Innovation 9 3

org 8 Potential Primary Care Payment Models Blended payment Global payment -Risk adjusted comprehensive primary care payment-(goroll model) Episode

4 Blended Payment Elements Fee for service Based on RBRVS Care management fee A capitated fee (per member per month) to cover non-visit and team-based care Pay for performance Bonus dependent on reporting or performance on quality measures 10 The Proportions Matter! 30% Change Over Time Blended Payment Model 11 Risk Adjusted Comprehensive PC Payment - Goroll Model Recognizes value of primary care team Increases base payment in return for redesigning delivery to improve access, quality, safety, cost efficiency, and comprehensive patient-centered care Risk adjustment reduces risk of avoiding complex patients 12 4

30% Change Over Time Blended Payment Model 11 Risk Adjusted Comprehensive PC Payment - Goroll Model Recognizes value of primary care team Increases base

5 Payment Features Monthly Management Fee (PMPM) Additional for risk/needs adjustment, panel size, estimated cost to build infrastructure Performance Bonus Guards against under-service Provides incentives for improved outcomes, reduced costs, patient satisfaction 13 Case Study Payment Reform CDPHP Pilot Cost to the plan- about 2% 27% of Bonus total Payment medical spend Return- about 4.5% of total spend 10% Quality- same or better FFS - RBRVS Patient, t staff and physician i Satisfaction all high 63% Risk-Adjusted Comprehensive Payment * *Targeted at improving base PC compensation by approximately $35, Bundled Payment-Prometheus Single payment for all services related to a treatment or a condition Evidence-informed base payment Patient t specific severity adjustment t Allowance for potentially avoidable complications (PAC) May be across multiple providers and settings 15 5

5% of total spend 10% Quality- same or better FFS - RBRVS Patient, t staff and physician i Satisfaction all high 63% Risk-Adjusted Comprehensive Payment * *Targeted at improving base PC compensation

6 Innovative Health Plan Model CareFirst BCBS Identifies patients needing more active management (essentially high cost history) Allows small practice to act like a virtual group Enhanced FFS (+12%) FFS plus $200 initial, $100 subsequent Shared savings Goal to enhance PC payment by 30% to 40% Keep In Mind That The CMS ACO Shared Savings Program Is Only One Manifestation Of The ACO Possibilities 18 6

FFS plus $200 initial, $100 subsequent Shared savings Goal to enhance PC payment by 30% to 40% 16 17

7 Medicare ACO Shared Savings Program Based on FFS claims system Retrospective analysis of claims data to determine attribution, cost and quality 5000 Medicare patients t needed d Shared savings split by formula between CMS and the ACO No guidance on internal incentives Primary care physicians can only be in one 19 Complex Adaptive Systems There is little argument that our health care delivery in the US is a complex adaptive system While there is a wide variety of actors, individual behaviors are governed by a few simple rules We are about to see dramatic changes in the response of these actors because of changes in the simple rules 20 Complex Adaptive Systems CAS Properties Common purpose Internal motivation Simple rules Simple rules for the flock Keep up Move toward the center of the group Avoid collisions 7

the US is a complex adaptive system While there is a wide variety of actors, individual behaviors are governed by a few simple rules We are about to see dramatic changes in the response of these

8 Complex Adaptive System-Health Care Common Purpose Individual health, population health, sustainable cost (Triple Aim) Internal Motivation Altruism/Professionalism, financial success and stability, community good Simple Rules For the health care system For ACOs 22 Crossing the Quality Chasm A New Health System for the 21 st Century Our common purpose as a health system is that the care should be: Safe Effective Patient-centered Timely Efficient Equitable Health Care Redesign Rules Care based on continuous healing relationships Customization based on patient needs and values The patient as the source of control Shared knowledge and free flow of information Evidence-based decision making Safety as a system property Need for transparency Anticipation of needs Continuous decrease in waste Cooperation among clinicians Committee on Quality of Health Care in America. Crossing the Quality Chasm: A New Health System of the 21 st Century. Washington: National Academy Press,

be: Safe Effective Patient-centered Timely Efficient Equitable Health Care Redesign Rules Care based on continuous healing relationships Customization based on patient needs and values The patient as

9 Accountable Care Organization Aims Safe, effective care for individual patients Commitment to the health of the community Efficient systems that reduce waste Shared responsibility for cost and quality Long term financial viability 25 ACO Simple Rules Patient engagement and partnership Align payment and incentives with aims Primary care is central and capable Culture of quality improvement Clinical, financial and IT integration Designed for the long term 26 Patient Engagement And Partnership Patients must be encouraged to choose and use a PCMH Center of care coordination Family/care-giver i involved Self-management support Superb access to care Continuity over time 27 9

care is central and capable Culture of quality improvement Clinical, financial and IT integration Designed for the long term 26 Patient Engagement And Partnership

10 Align Payment Incentives With Aims Pay for what you want to happen Payment and incentives should foster integration and cooperation Reward quality and outcomes Support infrastructure to accomplish the goals 28 Primary Care Is Central And Capable Primary care is supported and valued by the system Accessible Comprehensive Continuity assured IT enabled Clinical information Communications 29 Culture Of Quality Improvement Performance measurement is routine Systems approach to improvement Quality goals known to all Team work is the norm Patient outcomes Service oriented 30 10

by the system Accessible Comprehensive Continuity assured IT enabled Clinical information Communications 29 Culture Of Quality Improvement

11 Clinical, Financial And IT Integration Must eliminate fragmentation and waste Internal financial incentives are key Platform for data exchange Efficient management Service agreements 31 Designed For The Long Term ACOs must be set up for the right reasons Strong organizational integrity Optimize outcomes of care Community orientation Shared governance Patient centered

agreements 31 Designed For The Long Term ACOs must be set up for the right reasons Strong

12 Patient Centered Medical Home Demystified PCMH is nothing less than an extreme make-over for primary care practices, to make them: More Service Oriented for patients t More Efficient for better profit More Effective for patient outcomes More Fun to go to work for all 34 Great Outcomes Transforming America s Health Care System and Engage Members Practice Organization Health IT Transforming Primary Care Practices Quality Patient Measures Experience 35 Three Important Functions For PCMH Care management Proactively managing the patient s condition using EBM guidelines, registries and a team approach Care coordination Tracking and facilitating ti the patient s t interaction ti with all points of care outside the PCMH Care transitions Safe and effective transfer of support and responsibility as patients move from hospital to home or long term care (Bi-directional) 36 12

Primary Care Practices Quality Patient Measures Experience 35 Three Important Functions For PCMH Care management Proactively managing the patient s condition using EBM guidelines, registries and a

13 PCMH Care Management Registry System Care Team Home Monitoring Physician Patient Patient Self- Management Support 37 Care Management Tasks Formulate the care plan with the patient Agree on goals for treatment Enter patient data in a registry Use patient self management techniques to engage patient Educate about patient/family responsibilities Home monitoring Between visit contacts and reminders 38 PCMH Care Coordination Care Plan Home Care PCMH Mental Health Clinical Information Patient Specialist Hospital Facilitated Access Imaging Center Surgery Center Family and Caregiver Support 39 13

patient Educate about patient/family responsibilities Home monitoring Between visit contacts and reminders 38 PCMH Care Coordination Care Plan Home

14 Care Coordination Tasks Share the care plan and clinical information Arrange appointments if patient not able Track referrals, labs and consultations Follow up on reports and recommendations Engage family and care givers Set up service agreements 40 Transitions Of Care Hospital Coordinator Primary Care Hand-off Care plan Medication Reconciliation Clinical Info Pending issues Connect Timely Access Coordinate Care Follow up on pending issues Accept Capable Team Approach Engages Caregivers Whole person orientation

Of Care Hospital Coordinator Primary Care Hand-off Care plan Medication Reconciliation Clinical Info Pending issues Connect Timely

15 Care Transition Tasks Clarify modifications in care plan Reconcile medications with pre-hospital orders and supplies at home Understand level of help and support needed from others and arrange for needed services Solid transfer of responsibility Re-integrate patient into community of care 43 Other Payment Changes That Favor Primary Care No patient cost sharing for PC services (IBM) Medicaid payments at Medicare rates (PPACA) Commitment to PC workforce support (PPACA) Medicare E & M increase 10% (PPACA) PCMH support payments in pilots (Health plans) HIT stimulus payments ($44K/$64K) (ONC) E-prescribing bonus (CMS) CMS PQRS 44 For More Information on Payment and Delivery Reforms 15

cost sharing for PC services (IBM) Medicaid payments at Medicare rates (PPACA) Commitment to PC workforce support (PPACA) Medicare E & M increase 10% (PPACA) PCMH support

16 Conclusions Primary Care has the potential to do very well in the new payment environment but it must deliver on its promise To be successful, ACOs must be organized for optimal patient oriented outcomes while eliminating waste and unnecessary services ACOs should be viewed as a community resource not just a competitive advantage Patients should get all the care they need and only the care they need 46 bbagley@aafp.org 47 16

while eliminating waste and unnecessary services ACOs should be viewed as a community resource not just a

Brief environmental scan Ti Triple AIM?...key elements Why the Plus One? How do we get there? What will be the advantage for us?

The Current Environment Requires Progress On All Four Simultaneously! Bruce Bagley, MD President and CEO TransforMED Brief environmental scan Ti Triple AIM?...key elements Why the Plus One? How do we get