improving patient-centered care in maryland—hospital global budgets november 5, 2015
TRANSCRIPT
Improving Patient-Centered Care in Maryland—Hospital Global
Budgets November 5, 2015
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Overview The Evolving Healthcare Landscape:
Shifting to Patient Centered and Population Based Care
Unique Changes in Maryland’s Healthcare Delivery System
Global Budgets for Hospitals
Implementation Approach
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Context: Evolving National Landscape
Consumer
Demands
Aging, Sicker
Population
High Costs
Health Disparitie
s
Coverage &
Access Fragmentation
& Variation
Current Landscape
Provider Payment Structures
• Volume to value
Delivery of Care
• Coordinated care, population health, & patient engagement
Distribution of Information
• Transparency & meaningful use
CMS & National Focus
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Maryland’s Approach: New All-Payer Model
Maryland’s New All-Payer Model for hospital payment Approved by Center for Medicare and Medicaid
Services Effective January 1, 2014 Modernizes Maryland’s all-payer hospital rate
system in place since 1977 Implementation led by Maryland’s Health
Services Cost Review Commission together with stakeholder groups
Old ModelPer inpatient
admission hospital revenue
and OP unit rates
New ModelAll-payer, per capita, total
hospital payment & quality
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Backdrop: Health Services Cost Review Commission (HSCRC)
Oversees hospital rate regulation for all payers 7 member independent Commission
Rate setting authority extends to all payers, Medicare waiver
Provides considerable value Limits cost shifting--all payers pay their share,
including uncompensated care and graduate medical education
Innovates with stakeholders and regulates on a local level
Uses all payer metrics to measure outcomes and guide care improvement
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Maryland’s Innovation: New All-Payer Model Key provisions:
Ties all payer growth in hospital costs to the long term growth of the Maryland economy and assures Medicare of savings
Patient/population centered measures to promote care and health improvement (i.e. readmissions, hospital complications, patient satisfaction, etc.)
Payment transformation away from fee-for-service for hospital care
Innovation in payment began in 2011 (46 acute hospitals) Global budgets for 10 rural hospitals, hospital episode payments
that incorporated all cause readmissions for all others
2011 Global budgets
for rural hospitals
Stakeholder and HSCRC Implementation for 2014: Move All Hospitals to Global Budgets
Former Hospital Payment Model:
Volume Driven
New Hospital Payment Model:
Population Driven
Units/Cases
Hospital Revenue Allowed Revenue for Target Year
Revenue Base Year
Rate Per Unit or Case (Updated for Trend and
Value)
Updates for Trend, Population, Value
• Known at the beginning of year• More units does not create
more revenue
• Unknown at the beginning of year
• More units creates more revenue
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Key Aspects of Hospital Global Budgets Fixed revenue base for 12-month period with annual
adjustments Hospitals bill based on rates per unit as a cost distribution
system Hospitals raise and lower rates within corridors to stay on budget
Retain revenue related to reductions in potentially avoidable utilization Invest savings in care improvement
Annual update factor (inflation)
Demographic adjustment and adjustments for specialized services (transfers, transplants, specialized cancer patients)
Annual quality/value based adjustments
Adjustments when patients shift across hospitals and settings
Initial funding for infrastructure to support care coordination provided
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Maryland’s Current Situation & Future Focus Year 1 Model results were good: Financial targets were exceeded and
quality was improvedYear 1 Focus
Engage stakeholders
Initiate payment reform (Hospital global budgets)
Focused policies on reducing potentially avoidable utilization
Build infrastructure
Year 2 Focus (Now)
Work on clinical improvement, care coordination, integration planning, and infrastructure development
Partner across hospitals, other providers, and communities to focus on changes to care delivery
Years 3-5 Focus
Implement changes, and improve care coordination and chronic care
Focus on alignment models
Engage patients, families, and communities
Focus on model progression
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Focus Areas
Description
• Leverage and enhance statewide infrastructure
• Connect all providers• Bring additional electronic health
information to the point of care
Health Information
Exchange and Tools
• Promote value payment focused on outcomes
• Increase payment alignmentAlignment
• Increase coordination of clinical care • Scale chronic care and care for complex
patients• Support primary care• Promote consumer engagement
Care Delivery
Stakeholder-Driven Strategy for MarylandSustainability dependent on patient-centered care
delivery transformation and infrastructure to support it
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Approach to Moving to a More Patient-Centered System
Focus
Improving Patient-Centered
CareChronic Care & Care
for Patients with High Needs
Collaboration & Coordination Across
Providers/Others
Utilization of Patient-Centered Measures
Reducing Avoidable Utilization
Maryland’s Hospital Acquired Conditions
PQIs: Prevention Quality Indicators
Readmissions and Rehospitalizations
Ensuring Consumer
Protections
Global Budget Contracts
Market Shift, Transfers,
Transplants/Other
Data Analytics: Detailed Monthly
Reports on Volumes
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Hospitals gain control of their revenue budgets Payment is not volume-dependent
Global budget model opens up new avenues for innovation Hospital strategies are expanding— now there is a financial
incentive to manage resources efficiently and effectively to control cost growth while improving health
All-payer nature lends a greater ability to focus on common outcomes, which yields better care and outcomes for patients
Success and sustainability dependent on: Reducing avoidable utilization and improving population health Partnering with other providers, communities, and patients to
integrate and coordinate care Developing effective care coordination—emergency room,
transitions, addressing complex patients, disease management, long-term care and post-acute integration
Success Factors for Hospitals’ Change
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Summary Maryland’s new All-Payer Hospital Model tests
all payer innovation implemented at a state and local level Improve care and lower costs for all consumers
and purchasers, using common measures and aligned approaches, without undue cost shifting
Payment model change for hospital care provides a foundation for broader change
Stakeholder participation (especially the Maryland Hospital Association, MedChi, payers, consumer organizations, and others) in Model planning and implementation has been critical to early success
Appendix
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Potentially Avoidable Utilization (PAU)
“Hospital care that is unplanned and can be prevented through improved care, coordination, effective primary care and improved population health.” Readmissions/Rehospitalizations that can be reduced with
care coordination and quality improvements Preventable Admissions and ER Visits that can be reduced
with improved community based care Avoidable admissions from skilled nursing facilities and
assisted living residents that can be reduced with care integration, remote services, and prevention
Health care acquired conditions that can be reduced with quality improvements
Admissions and ER visits for high needs patients that can be moderated with better chronic care and care coordination