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The Delivery System of the Future: Own the ContinuumHEALTH DIMENSIONS GROUP NATIONAL SUMMITJosh Luke, PhD, FACHEMarvin O’Quinn, SEVP and COO, Dignity HealthFebruary 23, 2016
The Health System of the Future Lead. Follow. Or get out of the way.
JOSH LUKE, PH.D., FACHEUniversity of Southern California, Price School of Public Policy
Author, Readmission Prevention: Solutions Across The Provider Continuum
Founder, National Readmission Prevention Collaborative (2013)
Founder, National Bundled Payment Collaborative (2015)
Strategic Adviser, Nelson Hardiman Law/Compliagent
Josh Luke, PhD, FACHE
• SNF Administrator/AL Executive Director‒Kindred, Windsor/SNF Management, Life Care Centers of America
• Hospital CEO ‒Memorial Hospital, Western Medical Center, Anaheim General
• CEO for Acute Rehab ‒HealthSouth Las Vegas Rehab Hospital
• Vice President Post Acute Services ‒Torrance Memorial Health System
32016
Part One
Why I Became a Patient Advocate
2016 4
52016
1998 - It Was a Very Good Year
1998—It Was a Very Good Year
62016
Career Change
• My grandmother was ill and being juggled through the system
• Entered AIT program for Life Care Centers of America‒The best leadership lessons of my career
‒Discovering empathy: a heart for caring
• Became a hospital CEO two years later
2016 7
Part Two: The Fee for Service Free-For-All
From Volume to value: How we got here and where we go from here
2016 8
9
The Fee For Service “Free For All”
2016
Grandma Belva: 1920 - 2002Home $0Hemet Valley Medical Center $48,000LTACH $52,000Nursing Home $12,000Home with Home Health $4,000Hemet Valley Medical Center* $36,000Nursing Home $18,000Assisted Living with Home Health $4,000Hemet Valley Medical Center* $42,000Nursing Home $24,000Hemet Valley Medical Center* $58,000
$298,000
Provider and physician got paid at every stop:
Episode- based reimbursement
Tommy Olmstead v Lois CurtisU.S. Supreme Court Decision, June 1999
“Patients in an acute hospital have the right to be discharged to the least restrictive environment.”
“Continued institutionalization of patients who may be placed in less restrictive environments often constitutes discrimination.”
2016 10
“Operationally, physicians and hospitals must first rule out the least restrictive environment.”
The Transformation of the Acute Hospital: The C-suite Must Take Action
Coordinating care for improved outcomes:
• Hospitals must act likehealth systems
• Health systems must act like managed care organization
• Thus, the hospital must act like a managed care organization as well
• Mandated post acute care plans –October 2015
11
Hospital
HealthSystem
Managed Care
2016
Financial Incentives to Avoid Unnecessary Hospitalization
Welcome to the world of…Admission Prevention
• RAC Audits
• Hospital readmission penalty program
• Accountable Care Organizations
• Bundled Payments
• Medicare Spending Per Beneficiary penalty
• Better, smarter, healthier: In January 2015, HHS announced goal for 30% of Medicare spending in ACO/Bundle by 2016 and 50% by 2018
• Proposed Medicare Spending Per Beneficiary post-acute penalty
2016
Why Hospitals and ACO’s are Engaging No-cost Community Providers to Manage Post Acute Spending and Episodes
7 PROGRAMS & 18 REASONS HOSPITALS ARE FINALLY REACTING
Program/Initiative Revenue Opportunity
Cost Savings Penalty Exposure
ACO Shared Savings Yes - $ ↓ Yes - $Bundled Payments Yes - $ ↓ Yes - $
Value Based Initiatives Yes - $ ↓ Yes - $Readmission Penalty No ↓ Yes - $
Medicare Spending Per Beneficiary
No ↓ Yes - $
Better. Smarter Healthier. (30% in an APM by 2016; 50% in an APM
by 2018)
Yes - $ ↓ Yes - $
Care Plan Act No ↓ Yes - $
2016
What Does This Mean for You?
Hospitals = Last resort
SNF = Second-to-last resort
Home health = Networks will be narrowed
Winners = Home care, private duty, and assisted living
142016
Story TimeOnce Upon a Time…
15
The Fee-for-Service Free-for-All Era
Post-ACA Era
Old Hospital = 290 bedsNew Hospital =
249 beds
Hospital Bed Capacity
2016
Part Three: Strategies to Succeed in the New Era
Understanding Alternative Payment Models
2016 16
Home
SNF
Home Care/ Health
Dr. Office
172016
Alternative Level of Care Pre-Authorization Required?
Doctor’s Order
Required?
Notes
Observation Floor No Yes High Cost to Hospital; should be last resort
Physician Office/Urgent Care No No
Long Term Acute Care (Alt Acute) No Yes New admission criteria makes this process more challenging but still an option if patient meets STACH criteria
Acute Rehab No Yes Easiest
Skilled Nursing/Sub-Acute No** Yes ** Patients discharged from a hospital or SNF within last 30 calendar days
Assisted Living/Board & Care No No Cash pay; not a covered benefit; discharge delay
Home Health No Yes
Home Care No No Patient pays; not a Medicare covered benefit but no caps or limits on service
Hospice or Palliative No YesAcute Psychiatric Hospital Yes Yes Can vary based state to state
Options for Direct Transfer from Emergency DepartmentPatients with a Medicare benefit can be transferred directly from the Emergency Department to the following levels of care
Luke, Josh, 2016: www.joshluke.org; www.NationalBundledPaymentCollaborative.com
Emerging Trends For Health System Revenue Enhancement
Health Systems Revenue Streams1. Home care & private duty
2. Home health services (services capped)
3. Chronic care management- $35 to $45 per month (code 99490)
4. Transitional care management‒Range from $135 to $350 (codes 99495 and 99496)
2016
Post-Acute Opportunities & Expectations
1. Align with hospital based home health and home care
2. SNF’s should be skipping home health upon SNF discharge
3. Deliver data consistently on the 15th each month
4. Prep for disappearance of the 3 midnight rule
5. Prep for criteria/performance-based payment
6. Tools to Implement in facility: POLST ,Interact, Log readmits
7. The Super SNF: Where will the LTACH, IRF and Med Surg patients go?
192016
Bundled Payment: Competing for the Post Acute Dollar
Hip Replacement Case $40,000 for episode (hypothetical for illustration)
Acute Stay = $20,000 or 75%$18,000 $10,000 $2,000
Hospital Surgeon Anesthesia
Built in Margin For Initiator/Convener = $4,000 or 10%
Post Acute Care (All encompassing) = $6,000 or 15%Includes LTACH, IRF, SNF, Home Health, *home care, *assisted living, palliative and *other
In 2015 app. 42% of joints were discharged from acute to SNF. Projected to be only 20% by 2018.
That leaves 80% for home based providers!
* Not required to be a Medicare participant if application states service
2016 20
2016 21
Model 1 Model 2 Model 3 Model 4
Episode All acute patients; all
DRGs
Selected DRG’s, hospital plus post
acute period
Selected DRG’s, post acute period
only
Selected DRG’s, hospital plus
readmissionsServices included in Bundle
All Part A services paid as part of the MS-DRG payment
All non-hospice Part A & B services
during the initial inpatient stay, post
acute period & readmissions
All non-hospice Part A & B services
during the post acute period & readmissions
All non-hospice Part A & B services
(including the hospital &
physician) during initial inpatient stay& readmissions
Payment Retrospective Retrospective Retrospective Prospective
Severity of Financial Impact of avoidable Hospitalization
Medium High
Note: CCJR most closely resembles
Model 2.
High Severe (reduction in initial episode payment;
impacts health systems immediate
cash flow)
All Bundled Payment Models Impacted by ED Admissions
Source: HIN Reducing Readmission Survey, November 2009
Part Four: Challenges to Transformation
Case managers. Discharge planners. Care Managers…
Should I stay or should I go?
2016 22
Will hospital and post acute discharge planners transform?
Re-program discharge planning
‒Required by Care Management Act
‒First option for all patients is to go home if possible
‒Every post acute dollar spent has financial impact
‒Discharge planners can no longer assume patients are unwilling to pay; many services are capped
2016
The Discharge Planners New Role:Adopt a Home-First Mentality
LTACH AcuteRehab
SNF Home Health
Home Care
Assisted Living
Transit-ional
Care Visit
Chronic Care Man.
HospicePalliative
Degree of Financial and Quality Penalty to DischargingHospital
Severe Severe Moderate Nominal None None Negligible(its less
than 10% of the cost
of home health –and it
covers 30 of 60 days)
Negligible NoneNA
Discharge Level A A LR NR FO FOADH AHD ADWCD NA
Patient Financial Responsibility
Varies Varies 20% after 20 days
Nominal $ $ Nominal Nominal NA
2016 24
A – Avoid, LR – Last Resort (if patient is unsafe to go home with resources)FO – First Option and consideration for all patients NR – Only if the patient has No Resources to pay for Home Care, AHD – Order for All Home Discharges ADWCD – Order for All Discharges with Chronic DiseasesFOAHD – First Option After Discharge Home; Assisted Living can cause delays in hospital discharge; engage AL before discharge
My Legacy: Going Purple for My MomRaising $20,000 in 2016 to Fight Alzheimer’s Disease!
25
•Passion•Empathy•Fight•Use your gifts•Legacy
Values
2016
Josh Luke, Ph.D., FACHElukej@usc.edu
Are you Leading? Following? Or being left behind?
262016
Available at ACHE.org/publications
www.joshluke.org
www.NationalReadmissionPrevention.com
www.NationalBundledPaymentCollaborative.com
Clinical Integration:The Bridge to Accountable CareMarvin O’QuinnSEVP & Chief Operating Officer
February 23, 2016
28
• Introduction to Dignity Health
• Current State of the Industry
– From Volume to Value
– Population Health
• Integrated Delivery Network Strategy
– Clinical Integration (CI)
– Physician Interest & Responsibilities
• The Bridge to Accountable Care
• Bundled Payments
– Model 2
• Dignity Health Partnership with naviHealth
– Post-Acute Network
– Results in the Inland Empire
• Growth Strategy
Overview
29
Who We Are
As of September 30, 2015
21 400+ 9,000 59,000 39 667,000State
NetworkAffiliated
AccessPoints
Affiliated Physicians
Employees Acute Care Hospitals
Attributable Members
30
• On a recent “Face the Nation” episode, there was a panel discussion about former presidents who were skilled at helping their country overcome challenges in the 21st century.
• The discussion noted traits, common to effective leaders:– Resilient
– Inspiring
– Collaborative
– Great communicators
Common Leadership Traits
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
31
Continued Shift from Volume to Value-Based Care
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
32
Lead the way:
Continued Shift from Volume to Value-Based Care
Understand clinical measures: healthcare financial leaders need to get a handle on clinical quality and how much it costs to achieve a unit of healthcare outcome and quality.
Develop cost systems to quantify your margins: develop new, automated systems that show costs for activities across all sectors
Create your risk vision: we’ve been under various CMS quality programs for years. If you aren’t improving yet, then you need to prioritize helping your teams improve.
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
33
• Population health is the recurring theme in a recent interview of healthcare leaders from the 21 winning Healthcare IT News’ 2015 Best Hospital IT Departments.
• Fort HealthCare’s Senior Director of IT effectively summarized the increasing prioritization of population health:
Population Health is a Top Priority
“Population health is 100 times bigger and the road isn’t yet paved; it isn’t just about the data or the tools used by clinicians, it really is about changing the way healthcare organizations think about practicing medicine.”
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
34
Lead the way:
Population Health is a Top Priority
Get comfortable with blurred lines: provider and payer roles will become less obvious, and we’ll continue to rely less on four-walled structures.
Learn the new terminology: Are you familiar with Return on Engagement? In a PMPM capitated environment, you must budget time and resources for all patients.
Know how to treat a population: and take risk for that population. Load claims data and analyzing physician, diagnosis codes, and treatment pattern data.
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
35
Lead the way:
Population Health is a Top Priority
Learn new measurements: with 23.5 ACO and 7.8 million Medicare ACO patients, you must know your population to define how to measure success.
Collaborate to improve the care continuum: identify partner organizations and stakeholders you’ll need to collaborate with to achieve a broader definition of care.
Study patient flow: start by identifying the bottlenecks at your hospital or clinic. Use data to study patient movement and focus on improving the admission/discharge process.
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
36
• Using technology to engage patients will be a focal point of patient engagement conversations in 2016.
• Half of patients hospitalized in the last year started using wearable technology after their hospital stay.
• Lead the way:
Engaging Patients Through Technology
Understand how different patient segments use technology: technology is not a one-size-fits-all solution. Understand how different patient segments use technology.
Attend the International Consumer Electronics Show: CES is a global consumer electronics tradeshow that takes place every January in Las Vegas.
Health Catalyst. 2014. Top 7 Financial Healthcare Trends and Challenges for 2016.
• Leveraging Horizon 2020 strategies to build a system poised to address the demands of accountable care
Dignity Health: Moving Towards Accountable Care
Current
• Episodic Care
• Volume Driven/Fee-For-Service Payment Systems
• Acute Care Provider
• IT Systems in Silos
• Hospital-Physician Centric Interactions
Future
• Population Management
• Bundled Payments/Pay-For-Performance
• Diversified and Integrated Delivery System
• Integrated Information Systems Across Multiple Care Delivery Locations (Acute, Ambulatory, Home Health, Retail)
Horizon 2020 StrategiesGrowth, Cost, Quality, Integration, Connectivity, Leadership
Mission, Vision and Values37
38
Old Model of Stakeholders is Obsolete
HEALTH SYSTEMS DOCTORS HEALTH
PLANS CMS
The New Era Model is Joint Accountability!
39
Integrated Delivery Network Strategy
New payment models
Partnerships• Specific
expertise• Expand
continuum of care
Acute care market infill
Non-acute capacity growth
Clinical integration and other physician alignment
• Patient-Centered
• Aligned Networks
• Improved Outcomes
• Shared Risk
• Managed Populations
Components of Clinical Integration
Clinical Integration
Selective membership
criteria
Commitment to standardized
care
Care coordination infrastructure
Performance management
system
Legal, meaningful
performance-based incentives
Capability to jointly contract
with commercial payors
Adapted from The Advisory Board, “Building the Performance-Focused Physician Network.” 2010.
40
1. Improve quality of care
2. Increase efficiency/reduce cost
3. Provide a structure for independent and aligned physicians to partner with hospitals
4. Gives physicians opportunity to get be rewarded for their hard work via beneficial contracts
5. Facilitate physician buy-in for hospital quality and cost initiatives
Why Clinical Integration?
41
Model ReasonableCost
Includes All
Specialties
Joint Contracting
Employment - + +
Clinical Integration + + +
Co-Management + - -
Bill Clinton at California Association of Physician Groups Conf. 6-8-13 42
Our only hope for the 21st Century is to form a “mass thick network of creative collaborators.”
43
Physician Alignment and Clinical IntegrationFiscal Year End June 30
*IMS, One Medical, and Identity Medical Group
0
1,000
2,000
3,000
4,000
5,000
6,000
FY 12 FY 13 FY 14 FY 15 Q1 16
Partner Aligned groups*
Employed Model MedicalGroups (not in CI)Bakersfield CI
Redwood City CI
Ventura CI
Arizona CI
Inland Empire CI
Nevada CI
Growing Networks with over 5,700 Physicians Multiple Options for Alignment
Obtained Limited Knox Keene License
Health Plan Infrastructure in place
Employed
Aligned
Integrated
44
Momentum in Value Based Contracting
12/31/2009 07/01/14 6/30/2015 9/30/2015
Capitated Contracts
Primary Care Capitation
ACO
Bundled Payment
Narrow Network
Direct 2 Employer
Patient Centered Medical Home
On or Near Site Medical Offices
Other
Agreements
Attributable Lives667,000
596,000544,000
107102
74
105,000
20
45
CI Network Organizational Structure: Physician Led & Physician Driven
MedProVidex CI Program Network
Operating Agreement
Board of Managers
Initiatives Committee
PayerCommittee
Remediation Committee
Management Services Agreement
46
Physician Responsibilities for Membership
• Adopt and adhere to physician-developed standards to improve quality and efficiency
• Collaborate with colleagues to improve performance
• Agree to be measured and to share quality data with the network via technology provided with the program
• Be accountable for compliance with network policies and procedures
• Maintain medical staff privileges at or referring relationship with the local Dignity Health member hospital
5,700 participating providers
50% of Dignity Health’s total medical staff
Dignity Health’s CI program has been presented to the
FTC
47
Clinical Integration: The Bridge to Accountable Care
Fee-for-Service
Accountable Care
Opportunities Shift Towards Population Health
Clinical Integration Program
(Physician Network, Quality & IT Infrastructure)
CommercialPPO ACO Commercial
PPOP4P
MedicareAdvantage
MedicareACO
CMS Bundled Services
Managed Medicaid /
Duals
Patient Centered Medical Homes
Direct to Employer
48
49
CMMI’s Alternative Payment Methodology Focus
> 6,000 organizations participating
600 + ACOs (CMS and Commercial)
Bundled Payments for Care Improvement & ACOs
Bundled Payments for Care Improvement
Primary Care Transformation
Initiatives to Speed the Adoption of Best Practices
Initiatives Focused on the Medicare-Medicaid Enrollees
Initiatives Focused on the Medicaid and CHIP Population
Initiatives to Accelerate the Development and Testing of New Payment and Service Delivery Models
Comprehensive Care for Joint Replacement (CCJR) Model
Accountable Care
50
BPCI Model 2: Went Live on January 1, 2014
naviHealth Market Presence
Health Plan BPCI Health Plan & BPCI
Enterprise Footprint
Enterprise 75 markets 70 hospitals 1 physician practice 7 BPCI partners 8 MA partners > 100,000 episodes managed 1.5 million MA lives
25 Hospitals 18,528 episodes managed
Dignity
naviHealth is the only company with a proven operating model for managing post acute care at scale across multiple markets
Dignity Health and naviHealth Care Coordination
Pre Admission Acute SNF/ IRF/ LTAC Home Health
Health Services Liaison
• Non-clinical support team
• BPCI patient identified
• Performs Health Risk Assessment (HRA+)
• nH Care Coordinator communicates HRA+ results to care team at patient’s next level of care
Inpatient Care Coordinator (ICC)
• RN, LPN, PT/OT
• Goal to help inform the discharge disposition
• Identifies and educates patient and family on BPCI program
• Performs risk assessment
• Generates OPTTM
• Discussion of Preferred Provider list
• Warm handover to care team at patient’s next level of care
Skilled Inpatient Care Coordinator (SICC)
• PT/OT
• Performs admission and weekly LiveSafeTM to guide discharge planning discussion
• Collaborates with PAC care team to identify patient’s ongoing needs
• Warm handover to care team at patient’s next level of care
High Risk Case Manager (HRCM)
• Performs regular assessments including LiveSafe and other care management assessments
• Performs medication reconciliation
• Interventions tied to risk score
• Actionable interventions
• Risk rounds to move patients through the continuum
• Some markets may be in market resource, others, telephonic
A key value the Coordination Model provides a seamless management of patient care throughout the care continuum.
52
53
Initial Results from naviHealth’s Engagement
Reduction in Readmissions
from PAC
-15%
54
• BPCI patients identification hardwired with 85% accuracy• 74% (target: 80% ) referral rate to participating post acute
providers• 15% improvement in 90-day readmission• Hospital Care Coordinators and naviHealth to drive appropriate
post-acute care placement• Positive feedback from patients – 80-85% Medicare FFS patient coverage
• Volume doubled in Home Health over 3 quarters
Key Performance Outcomes – Inland Empire
55
Grow, Diversify and Expand the Continuum
Our growth strategy is evolving to leverage our
strides in innovative ambulatory care
models, expand our integrated delivery
networks, and grow our footprint
IDN Growth: New Markets
IDN Growth: Existing Markets
Health Plan Partnerships
Strategic Innovation
New Business Verticals
Physician Alignment and Population Health
International Markets
56
Partnerships to Expand Access
JV Partnership JV Partnership
• Innovative micro-hospital model
• Partner in Las Vegas market, branded as Dignity Health care sites
• Evaluating expansion to other markets
• Minority owner in parent company
• Consumer focused urgent care
• Launching partnership in Bay Area
• Co-branded with Dignity Health
• Evaluating expansion in other markets
• Video visit platform• Cost-effective care model• Selected by U.S.
HealthWorks as video visit partner
• Piloting with Dignity Health Medical Foundation
• 2016 Launch
57
Strategic Innovation – Areas of Focus
Chronic disease management
Patient as consumer
Continuum of care
Next generation operations
Opportunistic
58
• Consistent progress on strategic transformation
• Evolution of growth strategy
• Leveraging IDN strategies, diversified assets and partnerships
• Financial resources sufficient to support strategy
• Strong leadership team focused on building capabilities and next generation of leaders
• Delivering on commitment to our communities and our financial stakeholders
Concluding Remarks
Thank You
59
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