Healthcare Reform: What Does the Future Hold for Long Term Care. John Sheridan, MHSA, FACHE President ehealth Data Solutions, LLC June 11, 2014

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1 YOUR DATES HERE

2 Healthcare Reform: What Does the Future Hold for Long Term Care John Sheridan, MHSA, FACHE President ehealth Data Solutions, LLC June 11, 2014

3 Health Care Reform what it holds for LTC Why should we care? (What do our laws tell us and what does research show us?) Knowing where we are! AND Where we are going! How are we perceived? How is/should our contribution be known (measured)? data data data Reform will use BIG DATA again and again! Spend Spend What shall we spend? ACO A new Ocean or an existing current? What / How Bundled Payment, ACOs Next Steps HCBS Lessons / Next Steps / THE FUTURE!

4 The Future? Bipartisan Discussion Draft for a Bill Introduced 3/21/2014 LT-PAC is seen as chaotic, disorganized and Fragmented Therefore ACO, Bundles and Payment Reform will organize it..

5 EHR = Health Care Data / the age of Big Data Goals 1. Improved Care 2. Reduced Costs Challenges to universal EHR Form & speed of transition is uncertain Will it improve quality of life? Does it make economic sense?

6 CMS and ONC now pondering a possible software architecture for the exchange of health information. Architecture is based on the following core principles: Be agnostic as to the type, scale, platform, and storage location of the data Use public APIs and open standards, interfaces, and protocols Encrypt data at rest and in transit Separate key management from data management Include with the data the corresponding metadata, context, and provenance information Represent the data as atomic data with associated metadata Follow the robustness principle : be liberal in what you accept and conservative in what you send Provide a migration pathway from legacy EHR systems.

7 SNF Readmissions as of April 4, 2014 SGR Fix and - $$ available in the future to devote to EHR technology need ROI SNF Readmission penalties - Skilled Nursing Facility Value-Based Purchasing Program. AHCA agreed to this proposal, which requires the Secretary to specify a SNF allcondition risk-adjusted potentially preventable hospital readmission rate by October 1, Not later than October 1, 2016, the Secretary shall specify a measure to reflect an allcondition risk-adjusted potentially preventable hospital readmission rate for SNFs CMS will rank SNFs based on their achievement (relative to other SNFs) and improvement (relative to that particular SNF prior fiscal year) performance scores based on standards established by CMS. The performance and ranking methodology is determined by CMS. In order to fund the incentive payment pool, CMS will withhold 2% of SNF payments starting October 1, CMS will of the withheld amount by way of incentive payments to SNFs. The funds are redistributed to the industry based on a re-hospitalization metric that is to be defined by the Secretary.

8 Does your EHR support needed transformations? Slide taken from In Pursuit of High Value Care Shari M Ling, MD Deputy Medical Officer /CMS AHCA Quality Symposium 2/12/14

9 The 3-Legged Technology Stool - Why Care? Disease State Management Create cost savings by intensive focus and proactive management of nursing core services EMR- Electronic Medical Records Investment toward federally mandated electronic patient records ideally shared between providers in a fluid and transparent manner Analytics Optimize Quality, Brand Identity, Census, Payor Mix, CMS 5-Star, Annual and Complaint Health Surveys, Quality Measures, Staffing and Reimbursement achieved by taking action based on data for targeted improvement (essential step of QAPI)

10 The Business Case to get to Data for Healthcare Providers Pay for performance will give providers the business case to adopt IT and allow them to reap rewards from payments for quality that flow from better clinical information. - MedPAC, 2005 Many state Medicaid programs have P4P quality incentives

11 Research demonstrated Better Data, Better Decisions is evidenced based and can be cultivated: 50% Managers All Top Performers Good Data Won't Guarantee Good Decisions by Shvetank Shah, Andrew Horne, and Jaime Capellá - Harvard Business Review, April 2012

12 Starting Today it is clear that..start Now Every enterprise needs to fully understand big data what it is, what is does, what it means and the potential of data-driven decisions, Waiting will only delay the inevitable and make it even more difficult to unravel the confusion. Once you start tackling big data, you ll learn what you don t know, and you ll be inspired to take steps to resolve any problems. You can use the insights gathered at each step along the way to start improving your stakeholder engagement strategies; Source: What is Big Data? Lisa Arthur Contributor 8/15/2013

13 In the end Critical Thinking, Judgment and Action. Recent financial and business events show all too plainly what can happen when rich data and analytics collide with gaps in knowledge or lapses in judgment. So Leaders need to ensure that their processes and human capabilities keep pace with the computing firepower and information they import. To overcome the insight deficit, Big Data no matter how comprehensive or well analyzed needs to be complemented by Big Judgment. Good Data Won't Guarantee Good Decisions by Shvetank Shah, Andrew Horne, and Jaime Capellá - Harvard Business Review, April 2012

14 Why BIG Data?.. Conclusion.Data Literacy / Right Tools Big data is a collection of data from traditional and digital sources inside and outside your company that represents a source for ongoing discovery and analysis. Source: What is Big Data? Lisa Arthur Contributor 8/15/2013

15 What does Big Data look like? Example of Big Data 75 Beds 68 Census 365 Days Days of Care based on Average Census Hours of Care based 24 hrs X Days of Care 1. Big Data - data sets that are too large and complex to manipulate or interrogate with standard methods or tools 2. Imagine structured data from every hour of care charted in uniform and measureable way 3. What is your Brand Identity and how does your EHR reinforce it?

16 Baldrige Process Where does your Organization fit? Optimize available data to isolate trends, risk factors, and high-utilizers

17 When payment is bundled, Data is your source of Revenue! Bundled (data defined) Payment Like DRG: Defined by clinical and quality parameters the difference in patient before and after treatment Admissions and length of stay are central measures Do you know the LOS / admission combination for your SNF? Operators Strategy More thorough assessment of patient Core measures of clinical practice Best practice supported by literature (QAPI) Better Treatment = Better Payment Better and Better and Better Documentation in the EHR What is the magic rule?

18 Accountable Care Organization ACOs December 2013

19 Beyond 2014:Alternatives Pursuit of Sustainable Care Affordable Care Act Moved CMS from payer to policy maker CMS Actuary simulation predicts Medicare rates 1/3 those of private pay and ½ of Medicaid in 75 years Therefore / ACOs (420+ ACOs serving 5.0 to 7.0+ Million Beneficiaries) Deficit Reduction Act 2005 Bundled payments Person centered episodes CMS using Hospital Value Based Payment (HVBP) to bundle Episodes of days care services

20 ACO - When Revenue is Data! Medicare Shared Savings Plans Bundled (data defined) Payment ACOs measured by EOC Like DRG: Defined by clinical and quality parameters the difference in patient before and after treatment Admissions and length of stay are central measures Do you know the LOS / admission combination for your SNF? Operators Strategy More thorough assessment of patient Core measures of clinical practice Best practice supported by literature (QAPI) Better Treatment = Better Payment

21 Revenue Management ACO/MSSP Contract Basis for Risk Sharing Influence census toward high value providers Result: - ACO Exclusive Deal (like Sharp and Shea) - Risk sharing determined by - 70% Medicare Rate - Readmissions not to exceed X % - Mortality not to exceed X % - Length of Stay not to exceed X days Reward to ACO/MSSP providers for directing care to high quality, low cost receiving providers Risk Share by LT-PAC Provider

22 LT-PAC Managed Care Revenue Alternate Medicare Models using data differently LTC HMO (EverCare/Optum and like payers) Revenue Flow Managed Medicaid LTC Payment as usual Plus Up Front Per person Case Management $$$ Reward Based on Skilled Day and Acute Care Day reduction Based on attainment of specific Quality Measure results

23 CMS Mandated to Change Health Systems AKA New Navigation Principles Hospital Value Based Payment (HVBP) Withhold of all Hospital Med A Revenue Withhold return earned by Benchmark Performance and Improvements Person Centered Episode cost efficiency (PCE) PLUS: Creating bundled care DRG payment for episodes Continuing financial penalties for readmissions Continuing Person Centered Medical Homes (PCMH) Reform of Medicare as insurance ACOs Medicare shared savings plans

24 Forecast Changing Payer Mix Payers 2010 Estimated Payer Sources % 21% 5% 8% 10% Medicare Medicaid Other 11% Medicare Managed Medicare Medicaid Managed Medicaid 36% 30% Other Managed Other 66%

25 Hospital Value Based Payment (HVBP) Is this how ACO Performance may be judged? Sources for Withhold Repayment Mandated by Deficit Reduction Act of 2005 Domain FY 2013 Weight Clinical Process of Care Patient Experience of Care FY 2014 Weight FY 2015 Weight 70% 45% 20% 30% 30% 30% Outcome N/A 25% 30% Efficiency N/A N/A 20% Amount of All Med A $$ Withhold Fiscal Year of VBP Implemented Applicable Percentage % % % % 2017 and subsequent years 2.0% HVBP places hospitals at risk for postacute provider performance!

26 HVBP Efficiency Based on Medicare LT-PAC Spending per Beneficiary For any episode of care (PCE) Track provider revenue paid at each time period in the episode Know the average dollars per provider per episode Days 1-30 after discharge = LT-PAC dollars per episode Reward Acute Care by withhold repayment based on Benchmark Status Improvement over time And still have Readmission penalty

27 HVBP Efficiency Based on Medicare LT-PAC Spending per Beneficiary For any episode of care (PCE) Track provider revenue paid at each time period in the episode Know the average dollars per provider per episode Days 1-30 after discharge = LT-PAC dollars per episode

28 Acute Care HVBP Efficiency Withhold Repayment calls attention to LT-PAC Attention to Manage continuous episodes of care Find ways to detect & eliminate waste and redundant care Managed care episodes are NOT included Where can HVBP Reduce EOC Cost?

29 Factors to Consider for Survival Revenue Optimization Episodes of care Impacts SNFs and ALFs Nursing Home Value Payment is coming MDS adds the start date for post-acute episode of care beginning October 1, 2014 (ISC A1900) Readmissions are still a force Perhaps Transition of care interoperable record exchanges can drive PPS admissions / readmissions to lower cost and improve outcome SNFs, hospitals and ambulatory care use exchange of documentation to improve care Physician incentives in PQRS (3%) SNF readmission penalties Hospital and physician meaningful use exchanges (3%) PCMH Medical homes may case manage A money follows the person process especially for Managed Medicaid

30 Case Study: 2013 OPRS and Atrium Medical Center Middletown Ohio CCD as CDA (R2) interoperable exchange 73 Discharges from Atrium to OPRS Admissions Interoperable Record Exchange

31 S&I [Standards & Interoperability] CDA Templates S&I Framework CEDD What is the EHR? Care Transition Datasets Patient Assessments Encounter Summaries When does this EHR become real? Longitudinal Plan of Care CEDD [Common Element Data Dictionary] CDA [Clinical Document Architecture]

32 Care Transitions & Coordination Quality Reporting Payment EHRs success hinges on reporting as a byproduct of patient care Patient Care Physician Staff Patient Defining Payment and Quality data elements will not improve patient care Satisfaction Research Survey and Certification

33 Closing Words regarding Data and Change Slide taken from In Pursuit of High Value Care Shari M Ling, MD Deputy Medical Officer / CMS AHCA Quality Symposium 2/12/14