Healthcare Reform and Its Impact on the Care Delivery System

Transcription

1 Healthcare Reform and Its Impact on the Care Delivery System

2 Agenda 1) The Era of Healthcare Reform 2) Healthcare Reform and Post-Acute Care 3) Succeeding in the Reform Era: Managing the Continuum of Health 4) Post-Acute Care and End of Life Care 5) Planning for the Future of Healthcare Reform SESSION DESCRIPTION: Healthcare Reform has been part of our local and national dialogue for almost 10 years. But how much has actually changed, and how has that change impacted patients, employers, payers, and providers across the delivery system? This session will explore the scope and impact of healthcare reform on issues such as care delivery, value-based payments, risk capability, clinical integration and data analytics, with a focus on post-acute providers. 1

3 The Era of Healthcare Reform 2

4 The Demands of Today and the Near Term are EVERYWHERE INTENSE REAL 3

5 Healthcare Costs Continue to Rise Paced by Spending on Elderly Healthcare Costs by Age U.S. is spending much more for older ages Source: Fischbeck, Paul. US-Europe Comparisons of Health Risk for Specific Gender-Age Groups. Carnegie Mellon University; September,

6 The Era of Healthcare Reform PPACA (March 2010) GOALS Improve Quality Increase Access Reduce Costs OBJECTIVES PREREQUISTES Adopt New Models of Care Delivery Shift Accountability and Risk to Providers Redirect and Shrink the Dollars Provide Coverage for the Uninsured Physician Alignment Provider Integration New Model Adoption Electronic Health Records Source: HFMA DHG 5

7 The CMS Goal to Transform Healthcare Delivery % % In 2016, at least 30% of U.S. health care payments are linked to quality and value through APMs. In 2018, at least 50% of U.S. health care payments are so linked. Adoption of Alternative Payment Models (APMs) These payment reforms are expected to demonstrate better outcomes and lower costs for patients. Better Care, Smarter Spending, Healthier People 6

8 Innovative Programs to Bring CMS s Goal to Realization AMB/Physician Acute Post Acute Mandatory Voluntary Other VBPM/PQRS/MI PS Meaningful Use VBP/RRP/HAC MU, CAPC Star Rating CJR SNF-VBP Star Ratings MSSP/Next Gen/AIM Bundled Payment/ Oncology Care Improvement Transitions of Care State Initiatives (Bundles, DSRIP, Reform Programs) Price Transparency Value Based Contracting/Review: All Payers Home Health- VBP Star Ratings 7

9 CMS Alternative Payment Model // Schedule CMS ALTERNATIVE PAYMENT MODELS // SCHEDULE ACUTE CARE PROGRAMS Readmission (RRP) Value Based (VBP) VOLUNTARY EPISODIC PROGRAMS BPCI Model 1-4 Live BPCI Voluntary Program (2017) MANDATORY EPISODIC PROGRAMS Comprehensive Joint (CJR) Episodic Payment (EPM) ACCOUNTABLE CARE ORGANIZATIONS Pioneer ACO Model (Started 2012) MSSP ACO (Started 2012) Next Gen ANNOUNCED LIVE 8

10 The Rise of Value-Based Contracting By 2020, approximately 50% of healthcare dollars could be paid through value-based payment models. In Three Years 78% 49% 40% Of physician practices expect to have meaningful valuebased revenue Of facility revenue is projected to be derived from value-based payments Of health plans predict that value-based models will support the majority of their business Source: Aetna 2013 Investor Conference Presentation *Extrapolation of Availity survey results; 9

11 Healthcare Reform and Post-Acute Care 10

12 Healthcare Reform and the Impact Across the Care Continuum 11

13 Significance of Post-Acute Care PAC services drive a significant amount of current health care expenditure that for many populations is essentially unmanaged and Recent CMS programs highlight the important of clinical coordination and integration across the transition from acute to PAC facilities as success in any episodic payment model is based on the ability to manage and control postacute care spend Relatively short timeline for this type of program implementation can produce decreasing costs over a shorter period of time Cross positive impact on Readmissions penalties and Hospital Value Based Purchasing penalties/bonus on the Medicare Spend Per Beneficiary domain Cross positive impact on Physicians in the Cost component in both the network and the Cost component of MIPs up to 60% of episodic spending occurs post-acute 12

14 Post-Acute Care Performance Impacts 13

15 Impacting Spend in the PAC Environment: Where Opportunity Exists Other respiratory Acute myocardial infarction Major joint replacement of the lower extremity Medical non-infectious orthopedic Stroke Other vascular surgery Major cardiovascular procedure Fractures of the femur and hip or pelvis Lower extremity and humerus procedure except hip, foot, femur Hip & femur procedures except major joint 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 HHA IRF LTCH Out-patient Readmission SNF 14

16 Succeeding in the Era of Healthcare Reform: Managing the Continuum of Health 15

17 Becoming Risk Capable The Basics Enterprise Intelligence Advancing levels of risk require more sophisticated analytical models that can access data sets offering insight into cost and quality for a given population. Critical Success Factors Information / Analytics Requirement for Change Capital / Technology Clinical Enterprise Maturity An integrated Clinical Enterprise structurally engages providers around improved health outcomes, management of costs, acceptance of risk contracts, and value delivery to healthcare marketplaces. Critical Success Factors Alignment / Integration Requirement for Change Incentives / Time (People) Revenue Transformation Managed Revenue Transformation emphasizes the need for a next-gen revenue management platform focused on reimbursement for value with an aligned distribution methodology. Critical Success Factors Systems Requirement for Change Controls / Processes 16

18 Strategy: Aligned Continuum of Health TELEHEALTH 17

19 Maturity/Integration Of Delivery System Infrastructure / IT Needed Post-Acute Care Collaboration SYSTEM INTEGRATION FINANCIAL AND DATA INTEGRATION PARTNERSHIP CONDITIONAL COLLABORATION MINIMAL COMMITMENT Source: 18

20 The Benefits of Effective Post Acute Care Coordination Direct patients to most appropriate, lowest cost post-acute setting Select PAC providers based on clinical capabilities and performance indicators Ensure most effective care for most appropriate length of time Define referral patterns with clear clinical pathways Establish interdisciplinary teams for smooth care transitions and patient management 19

21 Post Acute Care and End of Life Care 20

22 Spending for End of Life Care End of life care remains a significant portion of healthcare spend $34,529 Average Medicare spending per beneficiary in traditional Medicare who died in almost four times higher than the average cost per capita for seniors who did not die during the year. 25% Percentage of spending for health care services provided to beneficiaries age 65 and older in the last year of life. Research shows that spending during the year of death decreases with age after age 73. Where the spending occurs: Hospital inpatient Skilled nursing Hospice 21

23 Where the Spending for End of Life Occurs Medicare covers a comprehensive set of healthcare services that include care in hospitals and several other settings, home health care, physician services, diagnostic tests, and prescription drug coverage through a separate Medicare benefit. Source: Kaiser Family Foundation (excludes Medicate Advantage beneficiaries) 2014 Medicare Claims Data 22

24 The Future of Post-Acute Care in the New Healthcare Era CURRENT STATE LOS Management Any discharge setting Any PAC provider Acute Focused Readmission interest Uncoordinated care teams High cost variation FUTURE STATE LOS Management RIGHT discharge setting EFFECTIVE PAC partner Post Acute Management Readmission Focus Integrated, interdisciplinary team Consistent, evidence based care 23

25 Planning for the Future of Healthcare Reform

26 The New Era of Healthcare Reform The new reform era will be driven by free market principles: MARKET COMPETITION and CONSUMER CHOICE Health Savings Accounts Cross-state Insurance Sales Increased Transparency Re-importation of Medications Negotiations with Drugs Makers Tax credits for individuals paying out-of-pocket Block-granting Medicaid 25

27 The New Political Agenda and its Impact on Healthcare Delivery Repeal and Replace ACA Allow sale of insurance plans across state lines Payers: NEGATIVE Providers: NEGATIVE Payers: NEUTRAL Providers: NEUTRAL Require Provider Price Transparency Re-importation of prescription drugs Payers: POSITIVE Providers: NEGATIVE Payers: NEUTRAL Providers: NEUTRAL Expand Health Savings Account Allow Medicare to negotiate drugs prices Payers: POSITIVE Providers: NEGATIVE Payers: NEUTRAL Providers: NEUTRAL Block grants for Medicaid funding Allow deduction of health insurance premiums Payers: NEUTRAL Providers: NEGATIVE Payers: POSITIVE Providers: POSITIVE 26

28 Emergence of Consumerism in the New Reform Era CHARACTERISTICS OF A TRADITIONAL VS. CONSUMER MARKET Traditional Market Passive employer, price-insulated employee Broad, open networks No platform for apples-toapples plan comparison Disruptive for employers to change benefit options Constant employee premium contribution, low deductibles 1 Growing number of buyers 2 Proliferation of product options 3 Increased transparency 4 Reduced switching costs 5 Greater consumer cost exposure Consumer Market Activist employer, price-sensitive individual Narrow, custom networks Clear plan comparison on exchange platforms Easy for individuals to switch plans annually Variable individual premium contribution, high deductibles Source: Health Care Advisory Board interviews and analysis 27

29 A Disciplined Response to Healthcare Reform PRIORITIZATION AND RESOURCE ALLOCATION STRATEGY DEFINITION GAP ANALYSIS ORGANIZATIONAL READINESS ASSESSMENT MARKET URGENCY ASSESSMENT 28

30 The Demands of Today and the Near Term are EVERYWHERE INTENSE REAL BUT LONG TERM SUSTAINABILITY REQUIRES PERSPECTIVE THAT IS INNOVATIVE HONEST WIDE ANGLED 29

31 Danny Brywczynski Senior Manager, DHG Healthcare O M Danny.Brywczynski@dhgllp.com

32 APPENDIX

33 Readmission Reduction Program 9% of Current and Future Medicare Reimbursement at Risk 3% penalty of Medicare Reimbursement at risk each program year Measured Populations 30 days from DISCHARGE AMI, HF, PN, COPD, THA & TKA, CABG August 2014: CABG Added to FY 2017 Performance Periods: 3 Year Rolling Program FY 16: July 1, 2011 June 30, % FY 17: July 1, 2012 June 30, % FY 18: July 1, 2013 June 30, % FY 19: July 1, 2014 June 30, % FY 20: July 1, 2015 June 30, % Currently participating in 3 performance periods simultaneously 32

34 VBP - Efficiency Medicare Spend Per Beneficiary (MSPB) Captures total Medicare Spending Per Beneficiary relative to a hospital stay, bundling hospital sources with post-acute care Bundles the cost of care delivered to a beneficiary for an episode across the continuum of care: 3 days prior Hospital Inpatient Stay 30 days post-discharge 33

35 End of Life Care Spending 34

36 Healthcare Spending Continues to Soar 35

37 36

38 Strategic Response and Key Initiatives PRIORITIZATION AND RESOURCE ALLOCATION STRATEGY DEFINITION CARE DELIVERY NETWORK ACCESS SITES AND TOUCH POINTS SERVICE ALLOCATION OPERATIONAL EXCELLENCE CONSUMER INTELLIGENCE AND ANALYTICS PLATFORM PRICING TRANSPARENCY AND APM ORGANIZATIONAL CHANGE LEADERSHIP COMMITMENT GAP ANALYSIS ORGANIZATIONAL READINESS ASSESSMENT MARKET URGENCY ASSESSMENT

39 Example of Post-Acute Care Opportunity Effectively managing the Bundled Payment is dependent on Post-Acute Care Total Joint Replacement (DRG 470) Inpatient and PAC Fee-for-Service Model $3,207 + $10,129 + $8,965 + $616 = $22,927 MD Home Health SNF IRF OP Rehab Home Readmission x 98% $22,468 Bundled Episode Episodic period for model 2: 3 days prior to admission to 90 days post discharge from hospital Note: Any aggregate payments lower than $22,468 can be shared with providers 38