The Maine Experience

In Pursuit of Value-Based Purchasing

August 4, 2009

Background

Self-insured POS plan of 34,000 (with additional 6,800 Medicare retirees)

Largest employer-sponsored plan in Maine Governed by State Employee Health

Commission, twenty-two member labor/management organization

Slightly older working population Higher incidence of chronic illness

The Path to Value-Based Purchasing Founding member of Maine Health Management

Coalition – multi-stakeholder organization of employers, hospitals, health plans, and physician groups

External factors Institute of Medicine reports Juran Institute report for MBGH NEJM study findings on treatment of chronic illness Dartmouth Atlas

Commission Adopts Value-Based Purchasing Strategy Growth in plan expenses is unsustainable Resisted traditional cost shifting tactics in

favor of value equation (quality, utilization, efficiency) – trying to change behavior

Gaps in care and unwarranted variation cannot be adequately addressed without changes in benefits and reimbursement

Phase I – TDES (1/1/05) Telephonic Diabetes Education & Support

program Improve participation in self-management

program and improve adherence to prescribed treatment

Partnership with TPA (Anthem) and non-profit Medical Care Development

Adapted traditional education and self-management model to telephonic pilot

TDES Basic Design

1st and 12th sessions require face-to-face encounter with nurse educator for pre/post assessment & biometric measures

Intervening 10 sessions are conducted via telephone at convenient times

Plan waives Rx copays for diabetic medications and supplies for duration of member’s participation

Results of TDES Pilot Participants received recommended care

evidenced by: physician visits, foot exams, retinal eye exams, HbA1c levels

Members participating in TDES had statistically significant improvement in adherence to oral diabetes medications

Compared to randomly selected control group TDES participants had an adjusted average cost $1,300 less than control group over 12-month follow-up

Phase II – Hospital Tiering (7/1/06)Goals & Objectives Encourage public disclosure of provider

performance Establish attainable performance benchmarks to

be incrementally adjusted Drive quality improvement Give members tools to make informed decisions Provide incentives to shape decision-making

Hospital Tiering Basic Design Completion of Leapfrog safe practices survey Performance on Maine Health Management Coalition

medication survey indicating “has made good progress to implement recommended safe practices”

Met or exceeded national average on CMS clinical core measures

Services billed by “preferred hospital” exempt from annual deductible

All hospitals remain in the network Over 60 sessions conducted statewide to inform

members

What Happened? Only 14 of 36 acute care hospitals met the

criteria for preferred hospital Members voiced concern to local hospital

officials for failing to meet criteria By 1/1/07 all Maine hospitals had completed the

Leapfrog safe practices survey and the MHMC medication safety survey

Number of preferred hospitals jumped to 25 by 1/1/07

The Next Phase of Hospital Tiering

Providers became more engaged in process Agreement to use MHMC as “trusted” source of

measures and reporting State aligned with MHMC hospital ratings – blue

ribbon designations (7/1/07) Financial incentives for members become more

meaningful (10/1/08)

What Do We Know About Hospital Tiering? Design was quite benign and non-threatening but it

produced results Incremental approach helped ensure members were not

disenchanted Focus on quality and safety insulated initiative from

provider complaints Anecdotally, hospital QI staff and pharmacists told us the

initiative helped secure resources In first year there was 5% shift in outpatient services

from non-preferred to preferred hospitals

What Have We Learned?

There is strong evidence to support that initial objectives have been met

Individually and collectively hospital quality performance has improved – at least for dimensions of care we measure

Incentives do have some impact on both provider and enrollee behavior

What Do We Need To Know?

Is there a link between higher-performing hospitals and efficiency?

How do we design incentives to produce desired results?

Can we adapt this model to specific high-volume or high-risk procedures?

How do we demonstrate the continued effectiveness of this strategy?

Phase III – Primary Care Physician (PCP) Tiering Maine Health Management Coalition’s

Pathways to Excellence (PTE) developed metrics to measure management of patients with chronic conditions

Measures office systems, treatment of diabetes, treatment of heart disease, treatment of pediatric asthma and results of childhood immunizations

How Does PCP Tiering Work?

Preferred practices must be awarded two or three blue ribbons

Office visit copays to preferred practices are waived

Services billed by preferred practices not subject to deductible

Developments in PCP Tiering

From 2007 to 2008 35% increase in the number of practices with 3 blue ribbons and 20% increase in number of practices with 2 blue ribbons

By 2009 over 50% of the better than 400 primary care practices were preferred

MHMC moving to national measures – Bridges to Excellence and NCQA

Phase IV

Adapt TDES principle to asthma and congestive heart failure (7/1/09)

Centers of Excellence for bariatric surgery (7/1/09)

Health credit program (10/1/09)

Next Steps

Minimally invasive surgery Introduction of efficiency measures (to include

utilization) for PCPs, specialists and hospitals Shared decision-making for preference-sensitive

services Regional medical tourism Payment reform