supporting care transformation through payment reform 10

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Supporting Care Transformation Through Payment Reform

Iowa Primary Care AssociationAnnual ConferenceOctober 22nd, 2019

Why is VBP & VBC Gaining Traction?

Curt Degenfelder Consulting, Inc.

The Triple Aim

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Total Cost of Care

Improving Health of

Populations

Improving Patient

Experience

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Fee-For-Service is Flawed

• Rewards volume without accountability to quality

• Focuses work on the billable provider instead of the work of the team

• Doesn’t reward continuity between the patient and provider

• Doesn’t incentivize proactively managing patients

• Doesn’t incentivize provider organizations to work together

• Doesn’t incentivize efficiencies in the health care system

• Hasn’t sufficiently supported primary care and behavioral health integration

• However, FFS does track access to services and will have a role in VBP/VBC

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There is a Better Way

• Value-based pay (VBP) can align payment to support and reward better care

• Otherwise, there is no point in changing payment

• Although there are many pitfalls to current VBP arrangements, there is energy behind continuing to move from volume to value

• There are some success stories in VBP of reducing costs and improving quality

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Benefits of the Patient Centered Medical Home

• Implement team-based care

• Improve continuity of care between patients and a provider/provider team

• Proactively manage a panel of assigned patients

• Provide more access to a broader set of HC staff

• Improve data and data analytics

Provides Structure to…

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Population Health

• Need good data, including external data (e.g., hospitals, specialists, community)

• Assess population holistic needs

• Stratify the population based on needs

• Targeted interventions (medical, BH, dental, SDoH)

• Need to know the patient’s preferences, needs and values

• Focuses more on engagement and outcomes rather than quantity of services

• Goes along with managed care/HEDIS concept of populations vs patients

Information from NCQA population health accreditation standards

Value-Based Pay & Capabilities Needed

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Spectrum of VBP Opportunities

• FFS + process or outcome quality incentives

P4P incentives, PCMH Tier payments,

• Partial Risk, Upside/Downside

Partial cap, bundled payment, shared savings and ACO; access and quality metrics woven into models

• Full, Global risk; access and quality metrics woven into model

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Capabilities Needed for VBP

• Patient-centered, team-based care has become the baseline

• Population health approaches to care delivery, whole person care

• Integration of medical, behavioral health and oral health services

• Evidence-based & innovation (e.g., testing SDoH interventions)

• Care coordination/care management, particularly for high risk pts

• Tracking and moving cost, quality and access metrics

• Open access

• Better data, including SDoH & data analytics

• Finance departments know costs, evaluate VBP opportunities and risk

• Culture of quality

© Hostetler Group

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• Time to play: build PCMH & BHH capabilities, like care coordination, IT capabilities, data & analytics, leadership

• Ability to capture and report data, usually quality metrics. SDoH is important for vulnerable populations, think about data for risk adjustment

• QI & chronic disease management programs

• Registries and performance dashboards

• Patient experience performance reporting

• Data security infrastructure

• Financial and payment performance modelling

• Aligned incentive performance payment programs

• Cultural alignment with quality

• Change management expertise

• Adaptive reserve

2A

2B

2C

FFS with Link to Quality and Capabilities Needed

© Hostetler Group Utilized information from the AHA TrendsWatch report & RevCycle Intelligence, Value‐Based Care News

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• Master care coordination

• Set quality and utilization benchmarks and standards

• Establish clinical protocols and coordinated workflow processes

• Population health capabilities (e.g., risk stratification)

• Alternative visits

• Care management capabilities, especially high risk

• Targeted disease management

• Medical oversight of coordinated care and disease management programs

3A

3B

APMs Built on FFS Architecture and Capabilities Needed

© Hostetler Group Utilized information from the AHA TrendsWatch report & RevCycle Intelligence, Value‐Based Care News

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In 4B & 4C, you need

• Utilization management and review

• Pharmacy benefits management

• Prevention and wellness programs

• Actuarial analytics & predictive modelling

• Payment processing and claims adjudication

• Underwriting

• Reinsurance

• Reserves maintenance

4N isn’t VBP, but can offer flexibility to evolve care transformation. Need to know your costs.

Population-Based Payment and Capabilities Needed

© Hostetler GroupUtilized information from the AHA TrendsWatch report & RevCycle Intelligence, Value‐Based Care News

Health Center Trends

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Curt Degenfelder Consulting, Inc.16

Recent History

Patient Protection and Affordable Care Act passed in 2010. This legislation benefitted health centers by:

Expanding the Medicaid program to include most citizens at or under 138 of the Federal Poverty Guideline (previously the program covered mostly moms & kids).

New Access Point funding, which allowed for New Starts (receiving 330 funding for the first time) and NAPs (additional grant funding for new sites for existing 330 grantees)

Expanded services funding to add providers/services

The net financial impact of these changes should have been very positive for the health center’s bottom line (profit) and top line (revenue and growth).


Current CHC Financial PerformanceThe Virtuous Cycle

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Positive Cash Flow through Productivity & Payor Mix

Investments in Infrastructure to Improve Quality & Efficiency

Increased Coverage of Base Administrative Costs

Working Capital to Fund Expansion

More Sites, More Patients, More Revenue


Health Center Trend Summary It is hard to recruit providers, and not enough providers lowers

revenue from visits

Visits per provider per day and per year are declining, and lower

provider productivity lowers revenue from visits

Medicare & Medicaid rate increases of approximately 1.2% per

year are not enough to keep up with provider compensation

increases (10%), staff raises (3%), and inflation (2.2 %)

Not enough pay for performance revenue to offset the decline in

patient service revenue

330 grant is a constant dollar amount

The financial benefit of Medicaid expansion has already occurred

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Health Center Trend Summary

Our electronic health record (EHR) specifically, and technology

generally, keeps eating up a greater portion of our budget

New staff (health coaches, referral coordinators) for better patient

management are not billable

Loan repayment program more difficult to qualify for

SO WHAT DO WE DO?

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Potential Shift In CHC Revenue

At least in the short/medium term, VBP is not sufficient to cover these trends20


APM To Address CHC Trends

BEFORE APM WITH APM

Providers 9 Providers 7.5

Visits/Provider/Year 3,333 Visits/Provider/Year 3,333

Total Visits 30,000 Total Visits 25,000

Provider Phone Encounters 1,500

Medicaid Rate per Visit 150.00$ Health Coach Encounters 3,000

Medicaid Revenue 4,500,000$ Staff Home Encounters 2,000

Diabetic Educator Encounters 900

Total Encounters 32,400

Member Months 120,000

APM PMPM Payment 37.50$

Medicaid Revenue 4,500,000$

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Transitioning Payment

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• This graph makes this transition process look simple, but it belies the complexity in moving to payment for value.

• It is critical to address the complexity appropriately in order to:» Improve outcomes instead of maintaining the status quo.

» Avoid creating scenarios that continue to incentivize visit‐based medicine.

» Avoid destabilizing the delivery of critical health care services to vulnerable population.

Source: https://www.healthcatalyst.com/hospital‐transitioning‐fee‐for‐service‐value‐based‐reimbursements

TRANSITIONING TO VALUE‐BASED REIMBURSEMENTS

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Balancing Better Care With Bottom Line

• Providers that move too quickly into VBC can impact viability byDecreasing FFS revenue

Investing more in care transformation than payers are willing to reimburse for

• VBC is different depending on the populations you servePayers are starting to understand this and talk about

flexibility

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Stepwise approach important• Remove F2F incentive

• Evolve the care model

• Account for behavioral & socio‐economic differences

• Get better at measuring value

• Paying for volume has a role in the absence of better risk adjustment

• Taking the first step – downside risk

© Oregon Primary Care Association

Value‐Based Pay and the Safety Net

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Phase I: Grants‐ Establish systems: Team formation, co‐location, data systems, Training, Meaningful Use, PCPCH

Phase II: Coding to reimburse for elements of model. Review of possible CPT codes aligned with model (Example: Behavioral Health Assessment Codes)

Phase III: Change in Scope Application (Adjust PPS rate to support new model)

Phase IV: Development of Alternative Payment Methodologywith payers to support model (baseline indicators, pay for process)

Phase V: Payment for Outcomes/ Value-Based Pay (VBP)

Policy Change

BUILDING THE FINANCIAL FOUNDATION FOR

PATIENT-CENTERED PRIMARY CARE

FQHC Capitated APM

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What is a Capitated APM?

• Converts FQHC Medicaid per-visit rates and utilization to a capitated rate

• The point of the capitated APM is to take the majority of FQHC Medicaid revenue off the visit, so clinics have the flexibility to transform their care model

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Medicaid Capitated APMs

• Difference between capitated and cost-based APMs

• Common purposes of capitated APMs

Remove the incentive to produce billable visits

Provide flexibility to implement robust team-based care, including SDoH interventions

Align with state payment reform efforts

Predictable cash flow – state, CHCs

© Hostetler Group

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How Does Rate Setting Work?

© Hostetler Group

Medicaid Patients 10,000

Visits Per Patient Per Year 3

Total Medicaid Visits 30,000

Medicaid Rate per Visit 150.00$

Medicaid Revenue 4,500,000$

Medicaid Member Months (10,000

x 12 months/year) 120,000

APM Rate Per Member Per Month 37.50$

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Capitated APM Increasing Popularity

• Started in Oregon (first statewide), then WA, then CO

• NACHC APM academy – IA, LA, MT, TN, NY

• Several other states are actively pursuing or have actively pursued: CA, CT, HI, IL, IN, MI, MO, NV, OK, Wash DC

• That’s 18 total, I’m sure there are others I’ve missed


Thoughts on Utilizing Providers In 20191973

1974

1972 Chevy Impala

1982 Ford Escort

In 2019, what is expensive and in short supply in the future?

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Cost of Workers

Physician - $170,000 – $240,000

PA & NP - $120,000 - $150,000

RN - $70,000 - $85,000

Integrated behavioral health provider - $65,000

Medical assistant 1 - $12/hr



Care/referral coordinator - $20/hr

Front desk - $13/hr

Scribe - $20/hr

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Actual – Visits to Touches

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BUT YOU SAID WE DON’T GET PAID FOR THIS!!!

Care Model Changes Under a Capitated APM – Oregon Example

WHAT GOT US HERE

Infographic from bipartisanpolicy.orghttp://bipartisanpolicy.org/sites/default/files/5023_BPC_NutritionReport_FNL_Web.pdfData from: McGinnis et al 2002. The Case for More Active Policy Attention to Health Promotion. HealthAffairs

PATIENT CENTERED MEDICAL HOME

NECESSARY BUT NOT SUFFICIENT

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• Whole person and family care• New team roles, including response to social factors• Team members work at top of license• Integrated and trauma‐informed approach • New workflows and clinical processes that integrate new

team members

• Care management infrastructure for complex care needs

• Community and public health partnerships

• Trauma‐informed approaches that integrate behavioral, medical and social services

• Partner with patients to educate on PCPCH access and services

• Therapeutic alliance to understand whole person priorities

• Motivational interviewing to empower and support patients

• Human‐centered design to create patient‐driven care transformation

• Focus on and document patient medical, behavioral and social priorities and strengths, as well as needs

• Team‐level• Population health management that

reflects whole person priorities• Identify disparities and use QI to

improve equity• Trauma‐informed and patient‐centered

approach to social determinants of health data collection and use

• Organizational data analytics strategy and capacity

• Access to wellness care, not just sick care• New models for group and technology

supported interactions• Care and services offered outside of clinic walls• Team‐based approach to providing continuity• Reportable documentation of all access and

enabling services• Co‐design new access models with patients

Change care and listen for the effects.


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Care STEPs


Listen to your data.


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Guided by the North Star

Triple Aim + Equity


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Quality Metrics Evolved

7 metrics 5 metrics‐ Colorectal cancer screening ‐ Colorectal cancer screening‐ Depression scrn w/ follow‐up ‐ Depression scrn w/ follow‐up‐ Diabetes poor control ‐ Diabetes poor control‐ Controlling high BP ‐ Controlling high BP‐ Childhood immunization ‐ Wt assessment & counseling, ‐ Developmental screening children and adolescents (NEW)‐ Timeliness of prenatal care

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APM Lessons Learned

• Transformative in providing alignment between model of care and payment

• Emphasizes the right care, right time, right person

• Requires significant investment in data and membership

• Requires significant investment in Change Management

• Prepares for Value Based Pay/Population Health

• Need to maintain focus on balanced scorecard: quality, access, patient experience, financials, staff engagement

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Results

• When Phase 7 went live, Oregon had 18 of the 32 CHCs + 2 RHCs implementing APM, over 75% of CHC patients in APM

• Care STEPs have gone from 270 per 1,000 patient to 1,250 per 1,000 patient over the duration of the program.

• Phases 1‐3 have demonstrated a net $17 million in cost avoidance in total cost of care on a per‐patient basis between 2013‐2015.

• For the same time period, APCM has had an impact on reducing Emergency Department utilization by a range of 6‐15% depending on the population.

• Phase 1 clinics above CCO averages for 5/6 measures; CRC 36% to 52%, Depression screening w f/u 48% to 65%; hypertension control 63% ‐ 67%; diabetes poor control 26% ‐ 28%


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Questions?

Craig Hostetler, PrincipalHostetler Group, [email protected]

supporting care transformation through payment reform 10

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