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l lClinical Integration:The Foundation for Accountable Care
Marvin O’QuinnSenior Executive Vice‐President andChief Operating Officer
October 20, 2014
Overview
• Introduction to Dignity Health
• Current State of the Industry
Overview
• Current State of the Industry
– What does reform mean?
• Clinical Integration (CI)g ( )
– What is it?
– Components of CI
– Organizational Structure
– Physician Interest & Responsibilities
O t iti & B fit– Opportunities & Benefits
• The Bridge to Accountable Care
– Clinical Integration as a strategy
2
Clinical Integration as a strategy
Dignity Health TodayDignity Health Today
One of the largest health systems in the nation
56,000 39Employees Acute Care
20 380+ 9,000State Care Affiliated Employees Acute Care
HospitalsState
Network Care Sites
Affiliated Physicians
Providing integrated, patient‐centered care to more than two million people annually
Di ifi d i ff i d t hi ti l ti h lthDiversified service offerings and partnerships supporting population health
Growing national footprint with U.S. HealthWorks
Hospitals in Arizona, California, and Nevada
3
p , ,
Dignity Health Horizon 2020 – Framework for the FutureDignity Health Horizon 2020 Framework for the FutureQUALITY COST GROWTH
• Top decile quality• Evidence‐based medicine• Chronic disease
• Medicare performance• Revenue services/CBO Salar and benefit costs
• Return on assets• Newly insured• New service areas
CONNECTIVITYINTEGRATION
• Chronic disease management
• National patient safety goals • Transformational care • Patient experience
• Salary and benefit costs• Clinical resource consumption
• Supply and purchased services
• New service areas• Commercial volume• Diversify non‐acute holdings
CONNECTIVITYINTEGRATION• Physicians• Health plan partnerships• Reimbursement models• Clinical integration • Clinical coding
• EHR Alliance• Physician connectivity• Patient connectivity• Physician EMR• Enterprise data A competitive cost structure,
LEADERSHIP
p
• Workforce competencies• Community benefit
p ,high quality, clinical integration, a strong technology infrastructure
and continued growth• Community benefit• Philanthropy• Nursing leadership • Employer of Choice • Public policy and advocacy
and continued growthare critical success factors
4
Dignity Health: Moving Towards Accountable Care
• Leveraging Horizon 2020 strategies to build a system poised to address the demands of accountable care
Dignity Health: Moving Towards Accountable Care
address the demands of accountable care
Current
•Episodic Care
Future
•Population ManagementEpisodic Care
•Volume Driven/Fee‐For‐Service Payment Systems
•Acute Care Provider
Population Management
•Bundled Payments/Pay‐For‐Performance
•Diversified and Integrated Delivery System• IT Systems in Silos
•Hospital‐Physician Centric Interactions
Delivery System
• Integrated Information Systems Across Multiple Care Delivery Locations (Acute, Ambulatory, Home Health, Retail)Home Health, Retail)
Horizon 2020 Strategies
Growth, Cost, Quality, Integration, Connectivity, Leadership
Mission, Vision and Values
5
Burning Platform for Change in Healthcare ReformBurning Platform for Change in Healthcare Reform
West Health Policy Center
6
Average Annual Worker and Employer Contributions to Premiums and Total Premiums for Family Coverage 1999‐2011and Total Premiums for Family Coverage, 1999‐2011
$12,106*$12,680*
$13,375*$13,770*
$15,073*
$9,068*
$9,950*
$10,880*
$11,480*
$5 791
$6,438*$7,061*
$8,003*
$ ,
$5,791
* Estimate is statistically different from estimate for the previous year shown (p<.05).
Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2011.7
The Move from Volume to ValueThe Move from Volume to Value
The overwhelming consensus is that volume based reimbursement will be supplemented by or replaced by quality and value based measuresp y q y
Fee for Volume Fee for ValueFee‐for‐Volume Fee‐for‐Value
8
Hospitals are Already Feeling the Pressures of ReformHospitals are Already Feeling the Pressures of Reform
l d h1. Value Based Purchasing
2. Penalties for Re‐admissions
d d d3. Reduced Medicare Margins
9
Physicians and Hospitals Are Being Driven TogetherPhysicians and Hospitals Are Being Driven Together
Hospital Physicians
1 Economic Concerns
• Continued cost pressures• Payer Mix shift
• Declining volumes• Ancillary reimbursement cuts
f l f
2
Concerns
Health
• Looming physician shortage
• Increased accountability for
• Professional fee cuts• Rise in practice costs
• Uncertainty around impact of new d lReform costs out outcomes
• Emphasis on care value• Inpatient demand destruction
payment models, coverage expansion
• Change in incentives• Specialty demand destruction
10
©2011 THE ADVISORY BOARD COMPANY
Old Model of Stakeholders is ObsoleteOld Model of Stakeholders is Obsolete
The New Era Model is Joint Accountability!
HEALTH SYSTEMS
DOCTORSHEALTHPLANS
CMS
11
The FTC’s Definition of CIThe FTC s Definition of CI
Clinical Integration is an arrangement in which physicians modify practice patterns and create a high degree of
i i d l d h licooperation in order to control costs and ensure the quality of services provided 1
The FTC also indicates Clinical Integration programs may include the following:include the following:
Establishing mechanisms to Selectively choosing
Significant investment of capital both
1. 2. 3.
monitor and control utilization of health care services that are designed to control costs and assure
Selectively choosing network physicians who are likely to
further these efficiency objectives
of capital, both monetary and human,
for the necessary infrastructure and
capability to realize the claimed efficienciesquality of care claimed efficiencies
The core of a CI program is a network of physicians, working collaboratively on a comprehensive set of quality and cost improvement initiatives selected as clinically appropriate and matched to the needs of their local markets, and supported by a p y pp p pp yrobust information system that enables the delivery of higher value care.2
1) Adapted from FTC Opinions 2) Adapted from Southwind
12
Components of Clinical IntegrationComponents of Clinical Integration
Care coordination
Performance management
Commitment to
coordination infrastructure
management system
Legal, f lCommitment to
standardized care
meaningful performance‐
based incentives
ClinicalSelective Capability to j i tl t tClinical
Integrationmembership
criteria
jointly contract with commercial
payors
13Adapted from The Advisory Board, “Building the Performance‐Focused Physician Network.” 2010.
Why Clinical Integration?
1. Improve quality of care
2 Increase efficiency/reduce cost
Why Clinical Integration?
ModelReasonable
C
Includes All
Joint C i2. Increase efficiency/reduce cost
3. Provide a structure for independent and aligned physicians to partner with
ModelCost
All Specialties
Contracting
Employment ‐ + +physicians to partner with hospitals
4. Gives physicians opportunity to get be rewarded for their hard
Employment + +
Clinical I t ti + + +g
work via beneficial contracts
5. Facilitate physician buy‐in for hospital quality and cost
Integration + + +
Co‐initiatives
CoManagement + ‐ ‐
14
Our only hope for the 21st Century is to form a “mass thick network f ti ll b t ”of creative collaborators.”
Bill Clinton at California Association of Physician Groups Conference 6‐8‐13 15
Transition Between Payment ParadigmsTransition Between Payment Paradigms
100%Fee For Value
Through
elen
erated
Tntive Mod
even
ue Ge
Incen
D COMPA
NY
Fee‐For‐ServiceRe
0%
HE ADVISO
RY BOARD Fee For Service
16
Time???
©20
11 TH
Dignity Health CI: If We Build It, Will They Come?Dignity Health CI: If We Build It, Will They Come?
Is this Heaven?
No, Dignity Health.
17
Physician Enrollment in Clinical Integration
3,601 4,000
Physician Enrollment in Clinical Integration
2,651
2,955 2,945 2,800 3,000
3,500
1,536
2,140 2,267 2,365
2,000
2,500
,
1,000
1,500
0
500
Q1 2013 Q2 Q3 Q4 Q1 2014 Q2 Q3 Q4 Q1 2015
18
CI Contracts to Date
14
CI Contracts to Date
10
12
6
8Global Cap ‐ Duals
Exchange Product ‐ FFS
IFP* PPO ACO
4
6PPO ACO
Medicare HMO
0
2
In Negotiations Fully Executed
19
In Negotiations Fully Executed
*Individual and Family Plan products sold both on and off the Covered CA Insurance Exchange
CI Network Organizational Structure: Physician Led & Physician DrivenPhysician Led & Physician Driven
Operating Agreement
MedProVidex CI Program NetworkManagement
Services Agreement
Board of ManagersManagers
Initiatives Payer Remediation
20
Initiatives Committee
PayerCommittee
Remediation Committee
Physician Responsibilities for MembershipPhysician Responsibilities for Membership
• Adopt and adhere to physician‐developed standards to improvedeveloped standards to improve quality and efficiency
• Collaborate with colleagues to improve performance
3,601 participating providers
p p
• Agree to be measured and to share quality data with the network via technology provided with the
33% of Dignity Health’s total
program
• Be accountable for compliance with network policies and procedures
medical staff
• Maintain medical staff privileges at or referring relationship with the local Dignity Health member hospital
Dignity Health’s CI program has been presented to the
FTC
21
Clinical Integration Data Flow
CI Portal and Dashboard (Clear DATA)User
Provision
&
CI Data Store and Calculation Engines
Acute Hospital Data
Tool
entication
&thorization
Dashboard
File Ambulatory Claims
Data
Admin Metrics
Authe
Aut Upload
ToolAmbulatory
Sampled Quality Data
P bli & P i tPublic & Private Network
Web Pages
All data transmitted through secure firewall and resides OUTSIDE Dignity Health
22
Benefits for All Major StakeholdersBenefits for All Major Stakeholders
Dignity H lth Physicians Payors Employers PatientsHealth
Hospitals
Quality
Physicians
Incentives for
Payors
Growth
Employers Patients
I dQuality Improvement
Growth (market share, payor
mix)
Quality Improvement
Growth(market share, payor mix)
Growth(market share, risk
distribution)
Cost
Improved Employee Health
Improved Clinical
Outcomes
)
Platform for HCR (e.g., bundled payments,
VBP, ACOs)
Physician
p y )
System positioned for
HCR
Coordinated
Reduction
Marketable Provider N k
Coordinated Care
yIntegration without
Employment
Financial Improvement
Coordinated Care System
Potential Higher Reimbursement from Payors
Network
Improved Quality
Cost Control Cost Control (reduction in co‐pays)
23
Clinical Integration: The Bridge to Accountable CareClinical Integration: The Bridge to Accountable Care
Accountable
Fee‐for‐
Accountable Care
Fee forService
24
Opportunities Shift Towards Population HealthOpportunities Shift Towards Population Health
Commercial
PPO
ACO Commercial PPO
P4P
Direct to Employer
Clinical Integration Program
P4P
MedicarePatient Centered Program
(Physician Network, Quality & IT Infrastructure)
AdvantageMedical Homes
Medicare
ACOCMS
Bundled
Managed Medicaid /
Duals
Bundled Services
25
The Strategic Advantage of CI
• The new care delivery models of accountable care require coordination across the continuum both inpatient and
The Strategic Advantage of CI
coordination across the continuum, both inpatient and ambulatory.
– ACOs
– Bundled payment programs
– Patient Centered Medical Homes
• Development of an aligned and coordinated physician network is vital for optimal performance in population management and to bring down the total cost of healthcare.
26
Clinical Integration & Accountable Care Organizations
Clinical Integration (CI)
A physician led program that will
Accountable Care Organization (ACO)
A f id d li f
Clinical Integration & Accountable Care Organizations
– A physician led program that will improve quality and efficiency, and allow for new avenues for reimbursement from commercial fee‐
– A group of providers and suppliers of services that will work together to coordinate care for the patients they serve.
for‐service payers.
– The CI Network of Physicians will work collaboratively, share data, and hold
– The goal of an ACO is to deliver seamless, high‐quality care, instead of the fragmented care that often results from a
each other accountable for performance against physician developed and agreed upon clinical performance and efficiency standards
fee‐for‐service payment system.
– When specific goals and benchmarks are met, an ACO has the opportunity to share performance and efficiency standards.in the cost savings created by improved care coordination.
27
Mechanics of the Medicare Shared Savings Program
– Program began January 1, 2013, contracts to last minimum of three years
Mechanics of the Medicare Shared Savings Program
years
– Physician groups and hospitals eligible to participate, but primary care physicians must be included in anyphysicians must be included in any ACO group
– Participating ACO’s must serve at least 5,000 Medicare beneficiaries
– Bonus potential to depend on Medicare cost savings and quality metrics
– Two payment models available: one with no downside risk, the second with downside risk in all three years
28
Why ACOs Matter to Dignity Health
–We believe that everyone who walks through our doors should be treated like a person not a patient
Why ACOs Matter to Dignity Health
be treated like a person, not a patient.
–We have been advocating for meaningful reform since our founding, because we believe access to care is a right.g, g
– The debate about health care is too narrowly focused on cost and politics and not on whether the system works.
–We want to implement reform in a way that brings humanity back into health care, which means understanding that human
ti h ki d h l l h lconnection – humankindness – helps people heal.
29
30
Th k YThank You
31