New Risk and Collaboration Models for Providers

Clinically Integrated Network

January 2014

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Agenda

Objectives for Today

Provide a brief history and context

Share the vision, objectives, and strategies

Review the model of care

Review Physician Care Network’s clinical and administrative services

Provide a status of recent activities and upcoming milestones

Share the requirements and benefits of physicians joining the CIN

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Background

Market & Competitive Pressures

Hospitals

Consolidating; increasing negotiation strength

Employing primary care and specialty physicians

Health Plans

Creating narrow networks and increasing price pressure

Implementing bundled episodic payments

Pushing risk based payment and shared savings models

Tying quality metrics to reimbursement levels

Requiring changes to protocols and treatment to improve outcomes

Demanding significant data compilation required to track and monitor

Result: A serious threat to the long-term viability of physician owned practices

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Addressing the Threat

Plan of Action

In 2013, the Northwest Medical Group Alliance initiated a study to determine the feasibility of creating a physician-led, Clinically Integrated Network (CIN)

Their network of over a dozen independent physician practices with more than 700 physicians is sufficient for limited network products

The proposed CIN delivery model is marketable and the timing is optimal

Hospital affiliation is not a priority

Member participation criteria can be met by most, if not all, medical groups in the Alliance and beyond

The right vehicle for the CIN is the Physicians Care Network (PCN)

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Physicians Care Network

Overview

Formed in 1997, serves as a mechanism for sharing financial risk through clinical integration across multiple medical group practices

Contracts with various health plans on behalf of its Members and administers quality and care management programs in accordance with payer terms and conditions

Integration across care settings of standardized clinical protocols‒ Steerage of patient care to lower cost settings

‒ Utilization management of high risk populations

‒ Formularies that promote generic drug use

Develops the provider network for health plans‒ Billing, credentialing, administration of risk pools and other risk sharing arrangements

‒ Management information services related to administration of those contracts

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Physicians Care Network

Overview (continued)

Engaged with four Medicare Advantage (MA) health plans‒ PCN participates with three of the four MA health plans under full risk, fully delegated (care

management, claims, credentialing) arrangements

‒ Participates in the Medicare ACO Shared Savings Program with the Centers for Medicare and Medicaid Services (CMS)

‒ Contracts with four health plans that focus on shared savings and reduction in the total cost of care delivered to plan beneficiaries

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Vision & Business Aims

Business AimDevelop and operate a clinically integrated network of independent physician practices that secures and supports performance of value-based contracts that reward practices

for delivering high quality patient care in an efficient manner

VisionEnable independent physician practices in the Pacific Northwest toremain independent and thrive in the new healthcare environment

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Strategies

Achieving the Business Aim

Create a robust and engaged clinically integrated network of independent physician practices

Identify, secure, and deploy an essential infrastructure to support CIN operations in a cost-effective manner

Engage physicians as leaders and full participants in the CIN's development and operations

Support participants’ practice transformation efforts

Identify, evaluate, and pursue network value-based payor contracting opportunities

Develop the capacity to accurately report the health status of defined patient population(s)

Ensure participants’ adherence to CIN-approved evidenced-based standards of care

Deliver "high-touch" care coordination for high-risk and patients who may become high risk

Deploy proven patient engagement tools to manage network patients

Develop metrics and measure outcomes for continuous quality improvement

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Desired Outcomes

Outcomes

Engage a critical mass of independent physician practices as CIN participants

Create a sustainable business model to support essential CIN infrastructure and services to its participating practices

Transform participants’ practices to engage in population health management

Secure favorable value-based payor contracts for CIN participants

Demonstrate quality through participants’ achievement of specified standards

Reduce the total cost of care for defined population(s) by specified targeted amounts (percentage reductions)

Improve the overall patient experience of care

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Model of Care

Scalable Services to Meet Patient Needs

High risk – high cost, complex needs

Cost Containment, support and coordination

Rising risk – at least one chronic condition

Motivational Interviewing, closing care gaps, strengthening relationship to PCP

Low risk Engage, set the stage

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Model of Care

Enhanced Care Model

Care coordination service delivery model with a focus on keeping patients healthy over time through screening and prevention, early intervention, health education, and meaningful management of chronic conditions

High risk / high cost patients actively managed and transitioned from high cost hospital based services to lower cost community based and home based care

Primary care providers rewarded based on the outcomes they achieve rather than by the number of exams they provide or tests they order

Evidence based clinical protocols, vetted by extensive research, and determined by experts to be most effective compared to other treatment options

Information sharing occurs across care settings to reduce duplication of unnecessary diagnostic and treatment orders and eliminate waste

Formularies that include step-therapy and increased use of generic drugs

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PCN Services

Care Management Services

Train and coach providers on the Enhanced Care Model

Establish and disseminate CIN guidelines and protocols (in collaboration with Member groups)

Promote practice improvement, quality, and cost management goals

Collaborate with Member groups to establish quality and cost measures and clinical benchmarks that drive health system change

Extend risk identification and care management tools and processes to Members

Provide risk adjusted coding training and services

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PCN Services

Administrative Services

Create the CIN, secure investors, and implement

Prepare legal documents for the joint venture: Bylaws, Articles of Incorporation, etc.

Develop Member participation agreements and negotiate contracts

Engage health plans and negotiate innovative payment models

Administer payment models

Develop prospective budgets and resource planning

Develop initial performance measures and baseline statistics

Brand, manage, and expand the network across the state

Manage CIN staff and liaison with in-kind services provided by Member groups

Credential Member physicians

Provide decision support and analytics tools and processes

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PCN Systems

Primary Systems

Phytel/Verisk – Concurrent and retrospective review Stratify, validate, and manage risk Identify care gaps Assist with quality indicators; track and trend quality measures Track population health around complex and chronic conditions Aggregate disparate data sources into consistent data sets for analysis and comparison of quality

and cost metrics Assist staff in its patient outreach activities through a set of protocols that support preventive and

chronic care follow-up

EZ-Cap – Administration Referral and Authorization Management Customer Service Encounter Submissions Reporting

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CIN Status

Recent Developments

Negotiated a term sheet with investors and gained agreement to move forward and engage provider groups

Developed milestones to ensure progress, safeguard ongoing capital investment, and provide investors with some assurance for their investments

Updated the Participation Agreement and created supporting materials for engaging prospective provider groups

Prioritized the list of potential provider groups

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CIN Governance Model

Clinically Integrated NetworkBoard of Managers

Executive Director

Medical Director(also supports MA business)

Population Health Management

Performance Improvement Contracts Technology

Business lead/controlled committees with physician participationPhysician lead/controlled committees

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Revenue Model

Care management fee (e.g.PMPM)

This approach…

Ensures there is immediate revenue to help offset operating costs Provides an alternative to health plan contracts that only provide the potential for

limited savings at the end of a contract period Avoids the diminishing returns associated with continuously squeezing costs out of the

system

The CIN plans to charge a flat per member per month (PMPM) fee

A flat fee across the entire population is much simpler than charging a much higher fee for only the high-risk patients; it also provides a more predictable revenue stream

This approach is not unique; it is consistent with other PCN and standard industry arrangements

The up-front fee may have to work in conjunction with a shared savings arrangement

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Next Steps

Upcoming Activities

Formally create the CIN enterprise‒ Execute the Term Sheet‒ Form the CIN legal entity (Operating Agreement, Articles of Incorporation, Bylaws, etc.)‒ Elect the Board of Directors; form and charge committees

Immediately kick off the next phase of provider group engagement

Execute contracts with health plan(s)

Complete the recruiting process and hire a Medical Director as soon as possible

Engage a CIN consulting firm to support implementation

Create a formal budget for 2015

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Important Dates

2015 Milestones

1/1/2015 1/1/2016

4/1/2015 - 9/30/2015Implement

Model of Care

1/1/2016Members Enroll in

New Product(s)

1/1/2015Form and

Capitalize Entity

2/1/2015Operationalize

Committees

4/30/2015Health Plans

File 2016 Products

9/1/2015Population Health Systems

Available to Members

3/31/2015Health Care Authority

Selects 2016 ACO Partners

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Joining the CIN

Membership Participation Criteria

Use a certified electronic medical record system

Meet or be in the process of meeting Meaningful Use standards

Identify and track at least one patient population or chronic condition

Have experience tracking some patient costs

Have process in place for managing transitions of care

Use ePrescribing, CPOE or electronic results reporting

Agree to cost management and performance risk management protocols

Agree to share data transparently

Agree to adopt the new model of care

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Joining the CIN

Member Benefits

The ability to remain independent as an alternative to large health system employment‒ With a number of quality focused provider groups, anchored by The Polyclinic and supported

by Physicians Care Network, the CIN will enable independent physicians to participate in risk-based, total cost of care contracts that they would otherwise not have access to

‒ This is critical to practice survival as health plan products are increasingly steering patients to narrow networks

Enhanced provider leadership over clinical decisions through selection and implementation of evidence based clinical protocols

Decision making seats on committees and influence to Board decisions

Innovative care delivery alternatives that enhance patient experience that, in turn, leads to growth in market share and revenue sharing opportunities

Access to population health management tools

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Joining the CIN

Member Benefits (continued)

Training and administrative services that streamlines data compilation and extraction for health plan quality metrics management

Financial analysis capabilities

An environment where independent providers can support one another through referrals, team based care, and care coordination while reducing the total cost of care

Risk adjusted coding training and resources