The Future of Health Care: A Prognosis for 2016
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Join thought leader Ed Park, COO for athenahealth, as he discusses coming trends for the world of health care in 2016.
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The Future of Health Care: A Prognosis for 2016
- 1. The Future of Health Care: A Prognosis for 2016 Ed Park Chief Operating Officer
- 2. 2
- 4. Agenda 4 1 Macro Trends Purchaser response Provider strategies 2 3
- 5. Macro trends
- 6. “Personal health care costs rose in the 12 months ending in May at the slowest rate in the last 50 years, as spending on hospital and nursing home services declined.” –USA Today, July 29, 2013 6 Source: CMS, WSJ Healthcare cost inflation has been tracking to a historic low
- 7. Care is moving out of the hospital while outpatient visits continue to rise 7 35 30 25 20 15 10 5 0 -5 -10 -15 -20 v v v v v v v v v v v v 33% -17% Outpatient services per FFS Part B beneficiary Inpatient discharges per FFS Part A beneficiary v v v v Fiscal year Cumulativepercentchange vv 2006 2007 2008 2009 2010 2011 2012 20 13
- 8. Medicare enrollment project to grow rapidly as members of the baby-boom generation age into the program Source: 2014 annual report of the Boards of Trustees of the Medicare trust funds, https://www.cms.gov/Research-Statistics- Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/downloads/tr2014.pdf. 100 90 80 70 60 50 40 2015 2020 2025 2030 20402035 2045 20502010 Numberofbeneficiaries (inmillions) 10,000 people will enter Medicare every day for the next 15 years 8
- 9. Source: http://www.realclearpolicy.com/blog/2012/05/ 30% 25% 20% 15% 10% 5% 0 1970 3.9% 2011 10.4% 2085 25.7% < Social Security < Medicaid, Obamacare Subsidies, CHIP Actual Projected Actual Revenue Average Historical Revenue; 18.1% 2045: Entitlement spending matches tax revenue average 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 2090 < Medicare And overall, we’re still on pace to bankrupt the U.S. 9
- 11. The Grand Bargain of the ACA is to expand coverage while reducing Medicare rates -575.1 11
- 12. On the coverage side, there is increasing enrollment in the public exchanges… 12
- 13. Expanding Medicaid 28States plus DC Considering Expansion 5States Not Expanding Medicaid 17States Source: The Advisory Board Company. …and Medicaid expansion continues to (selectively) move forward… 13
- 14. 17.5% 17.3% 16.9% 16.3% 16.8% 17.1% 18.0% 17.1% 15.6% 13.4% 13.4% 12.9% 11.9% 0% 4% 8% 12% 16% 20% Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Source: http://www.gallup.com/poll/182348/uninsured-rate-dips-first-quarter.aspx 1 December 2013 to September 2014. Lowest Uninsured Rate on Record Percentage of U.S. Adults Without Insurance, by Quarter 34% Decrease in Proportion of Uninsured Visits on athenaNet1, Expansion States 10% Decrease in Proportion of Uninsured Visits on athenaNet1, Non-Expansion States …resulting in the lowest uninsured rate on record 14
- 15. Physicians providing care to Medicare patients could face a “tsunami” of regulatory penalties over the next 10 years, potentially seeing payments cut by more than 13 percent by the end of the decade. - American Medical Association On the other side of the ledger, the promised cuts are coming! 15
- 16. By 2018, the Obama Administration wants 50% of all Medicare payment to flow through value-based entities like ACOs, up from 30% today. 90% of payments to be tied in some way to quality. In January, CMS signaled that it would get more aggressive about making good on the promised cuts 16
- 17. In July, CMS announced mandatory bundles in some areas through the Comprehensive Care for Joint Replacement Initiative 17
- 18. 18
- 19. LET’S GEEK OUT
- 20. http://medicaleconomics.modernmedicine.com/medical-economics/news/top-5-financial-challenges-facing-physicians-2015?page=full The carrots are becoming sticks – CMS has shifted to Penalty for Performance for PQRS and MU 20
- 21. Your Performance: Average Quality, Average Cost Each year a Quality and Resource Use Report (QRUR) comes out where CMS uses practice’s data reported from PQRS to show you where you fall in terms of performance. A new program, the Value-Based Modifier (VM) is an adjustment that builds on top of PQRS 21
- 22. Quality Cost Low Avg High Low 0% +2.0% +4.0% Avg -2.0% 0% +2.0% High -4.0% -2.0% 0% Groups with 10+ EPs Quality Cost Low Avg High Low 0% +1.0% +2.0% Avg 0% 0% +1.0% High 0% 0% 0% With the VM, depending on how you place in the QRUR, a penalty or bonus will be applied your fee schedule Groups with <10 Eps & Solo EPs 22
- 23. http://www.ama-assn.org/resources/images/washington/medicare-sgr-penalties-850x1100.jpg Year Deficit E-prescribing Health information Physician quality reporting system, including Maintenance of Certification (MOC) Program Value-based modifier (budget neutral increases and decreases in payments based on cost/quality data measures from 2 years earlier) Total possible paymenty cuts including sequester 2014 (-2%)* (-2%) $4-12K 0.5% if no MOC: 1%if MOC (-4%) 2015 (-2%) $2-8K (-1 to 2%) (-1.5%) (-1.5%) Applied to groups of 100 or more/2013 data** (-5.5% to 6.5%) 2016 (-2%) $2-4K (-2%) (-2%) (-2%) Groups of 10 or more/2014 data ** (-8%) 2017 (-2%) (-3%) (-2%) (-4%) all physicians/ 2015 data** (-11%) 2018 (-2%) (-3%) (-2%) (?) all physicians/ 2016 data** (-12%) or more 2019 (-2%) (-3%) (-2%) (?) all physicians/ 2017 data** (-13%) or more *Red text indicates penalties, black text indicates bonuses. ** 2017 marks the third year that the VBM will be applied; the magnitude of the adjustments that will be made in future years is determined through annual rulemaking. Since adjustments have doubled each year since the VBM was first implemented, the potential for increasingly severe cuts in 2018 and beyond is significant. Some physicians will qualify for payment bonuses of an amount not yet known. 2017 (-2%) (-3%) (-2%) (-4%) (-11%) There is 11% downside to 2017 Medicare payments based on 2015 performance! 23
- 24. Source: http://www.healthcare-informatics.com/article/breaking-president-obama-signs-sgr-repeal-legislation-shifting-medicare-physician-payment-in And the rules will keep changing… in 2019, as part of the SGR fix, MU+PQRS+VBM will be rolled into the Merit-Based Incentive Payment System 24
- 26. Source: The Medicare Access and CHIP Reauthorization Act of 2015; Advisory Board analysis. Under MIPS, the swing in Medicare FFS rates will increase to 36% by the year 2022 Merit-Based Incentive Payment System1 2020: -5% to +15% 2019: -4% to +12% 2022 and on: -9% to +27% 2021: -7% to +21% 2018: Last year of separate MU, PQRS, and VBM penalties 1. Positive adjustments may be scaled by a factor of up to 3 times the negative adjustment to ensure budget neutrality. Actual positive adjustments may be lower than numbers shown here. In addition, top performers may earn additional adjustments of up to 10 percent. 26
- 27. Source: The Medicare Access and CHIP Reauthorization Act of 2015; Advisory Board analysis. Starting in 2019, groups can opt out of MIPS if 25% of their revenue is Medicare AND they enter an alternative model like MSSP 2.APM participants who are close to but fall short of APM bonus requirements will not qualify for bonus but can report MIPS measures and receive incentives or can decline to participate in MIPS. 2019 - 2024: 5% participation bonus 2019 - 2020: 25% Medicare revenue requirement 2021 and on: Ramped up Medicare or all-payer revenue requirements Advanced Alternative Payment Models2 27
- 28. MIPS MSS P
- 29. The Medicare Shared Savings Plan (MSSP) has its own set of complex rules www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/RY2015-Narrative-Specifications.pdf 29
- 30. As an ACO, quality hurdles must be met across 33 measures to obtain any savings realized in the MSSP program. Patient/Caregiver Experience1 Care Coordination2 Preventative Health3 At-Risk Populations4 The Medicare Shared Savings Plan (MSSP) has its own set of complex rules www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/RY2015-Narrative-Specifications.pdf 30
- 31. http://www.cms.gov/Medicare/Health-Plans/MedicareAdvtgSpecRateStats/downloads/Evaluation_Risk_Adj_Model_2011.pdf Hypothetical example of CMS-HCC (version 12) expenditure predictions and risk score community-residing, 76-year-old woman with AMI, angina pectoris, COPD, renal failure, chest pain, and ankle sprain Risk marker Incremental prediction Relative risk factor Female, age 75-79 $3,409 0.457 Acute myocardial infraction (HCC 81) $2,681 0.359 Angina pectoris (HCC 83) $0 - Chronic obstructive pulmonary disease (HCC 108) $2,975 0.399 Renal failure (HCC 131) $2,745 0.368 Chest pain (HCC 166) $0 - Ankle sprain (HCC 162) $0 - Total $11,810 1.583 And regardless of model, providers will need to master HCC risk adjustment 31
- 34. Average Annual Worker and Employer Contributions to Premiums and Total Premiums for Family Coverage, 1999-2013 *Estimate is statistically different from estimate for the previous year shown (p<.05). Source: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2013. 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 $1,543 $1,619 $1,787* $2,137* $2,412* $2,661* $2,713 $3,281* $3,354 $3,515 $3,997* $4,129 $4,316 $2,973* $11,429* $10,944* $9,773 $9,860* $9,325* $8,824 $8,508* $8,167* $7,289* $6,657* $5,866* $5,274* $4,819* $4,247* $5,791 $6,438* $7,061* $8,003* $9,068* $9,950* $10,880* $11,480* $12,106* $12,680* $13,375* $13,770* $15,073* $15,745* Worker Contribution Employer Contribution Employer healthcare costs have tripled over the last decade $4,565 $11,786* $16,351* 34
- 35. 35 The Health Care Cost Crunch, 1999-2013 Source: Kaiser Employee Benefits Survey, 2013; median wage from EPI analysis of CPS $20,000 $16,000 $12,000 $8,000 $4,000 $0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 $20.50 $19.50 $18.50 $17.50 $16.50 $15.50 $14.40 8.7 10.4 13.1 16.0 17.8 19.3 22.7 24.5 Weeks of full time work (at median wage need to pay family premium Average annual premiums (single coverage) Average annual premiums (family coverage) Median wage (right axis) Today’s average family premium is half a year’s work at median wage
- 36. The dominant response so far has been higher deductibles 36
- 37. Source: Accenture Private Health Insurance Exchange Consumer Research But trade-offs will become more complex % of respondents willing to accept tradeoff for reduced monthly premium Higher Deductible 78% Greater Cost Sharing (e.g., Copay) 23%75% Wellness Program Participation 26% Less Network Flexibility 25% Fewer Services Covered
- 38. With 6 million enrollees for 2015, according to Accenture, a prominent management consulting company, private-exchange enrollment has doubled since 2014. May 2015 http://www.heritage.org/research/commentary/2015/5/a-health-care-revolution-on-private-exchanges
- 39. Source: Accenture analysis, based on data from : U.S. Census, Bureau of Labor and Statistics, Kaiser Employer Health Benefits Annual Survey. Calculation includes pre-65 employees and dependents. http://www.accenture.com/us-en/Pages/insight-private-health-insurance-exchange-annual-enrollment.aspx 2014 2015 2016 2017 2018 3 6 12 22 40 40 30 20 10 0 Enrollment(Millions) Estimated Projected This trend towards private exchanges will likely continue to skyrocket 39
- 40. The Cadillac Tax begins to reverse healthcare as an employer-sponsored pre-tax expense
- 41. Effective 2018, the Cadillac Tax, a 40% corporate tax on benefits above a threshold, will push employers towards exchanges 41
- 42. 42
- 43. And the beat goes on-- narrow networks are increasingly prevalent in the exchange market, offering a new litmus test Source: McKinsey Center for U.S. Health System Reform/McKinsey Advanced Healthcare Analytics analysis of publicly available rate filings and carrier information; AHA database, Data as of 11.15.2013, McKinsey & Company. 70% of hospital networks on exchanges are narrow or ultra- narrow Ultra- narrow 38% Narrow 32% Broad 30% Distribution of networks by network breadth1 2014 individual exchange – Percent of analyzed silver networks (n = 1202) 43
- 45. The health care chess board… Urgent Care Imaging Center Lab Pharmacy Retail Clinic Small Physician Group Small Physician Group Hospital Hospital Small Physician Group Small Physician Group Specialty Clinic Orthopedics Special Surgery At-risk health system At-risk health system
- 46. Urgent Care Imaging Center Lab Pharmacy Retail Clinic Small Physician Group Small Physician Group Hospital Hospital Small Physician Group Small Physician Group Specialty Clinic Orthopedics Special Surgery At-risk health system At-risk health system 1 Build a hospital-centered health system
- 47. Urgent Care Imaging Center Lab Pharmacy Retail Clinic Small Physician Group Small Physician Group Hospital Hospital Small Physician Group Small Physician Group Specialty Clinic Orthopedics Special Surgery At-risk health system At-risk health system 2 Build a multispecialty group that focuses on primary care delivery and takes on significant risk
- 48. Urgent Care Imaging Center Lab Pharmacy Retail Clinic Small Physician Group Small Physician Group Hospital Hospital Small Physician Group Small Physician Group Specialty Clinic Orthopedics Special Surgery At-risk health system At-risk health system 3 Build a specialty group that focuses on doing a few things really, really well
- 49. 49 A fourth option, virtual networks, is being enabled as the floodgates are open on interoperability
- 50. • Demographics • Referral Reason (Referral) • Plan of Care • Reasons for Visit • Instructions (Discharge) • Insurance • Problems • Medications • Allergies CCDA Content (MU2 Standard) • Immunizations • Diagnostic Results • Vitals • Procedures • Encounters • Advance Directives • Social History • Family History • Cognitive Status The hole in the dike was Meaningful Use, which standardized key vocabularies 50
- 51. Medications are manually reconciled by the MA or provider Vaccines, problems, allergies are automatically reconciled with source attribution noted All documents and notes across the continuum of care (labs, imaging centers, discharge summaries) are available For the first time, a unified view of the patient, the holy grail of healthcare IT, is within reach 51
- 52. Urgent Care Imaging Center Lab Pharmacy Retail Clinic Small Physician Group Small Physician Group Hospital Hospital Small Physician Group Small Physician Group Specialty Clinic Orthopedics Special Surgery At-risk health system At-risk health system 4 These advances in interoperability will enable a strategy based on technology-enabled partnerships
- 53. We have been pushing forward aggressively with Epic, Cerner, and Meditech on interop 53
- 55. 55
- 57. 57 The newest battleground is patient access
- 58. 6 OF TOP 10 FEATURES ON ACCESS, CONVENIENCE Service • Provider education on illness and wellness • Provider continuity Affordability • In-network status • Eliminated out of pocket charges Access, Convenience • Walk in availability, less than 30 minutes wait • Lab tests. X-rays, pharmacy onsite • 24/7 access • Same day appointment availability • Geographic proximity SOURCE: The Advisory Board Company
- 59. Avg. wait time under 8 min. Avg. door to door time for patients is 45 min. Patients register via mobile tablet, saving 2½ minutes per patient ⅕ the cost of the ED
- 60. Retail clinics are growing at a blistering clip The Growth of Retail Clinics Source: Merchant Medicine LLC. - 500 1,000 1,500 2,000 2007 2008 2009 2010 2011 2012 2013 2014 2015 RetailClinicsatStartofYear Year 60
- 61. Urgent care is growing explosively as well The Growth of Urgent Care Centers Source: Estill Advisory Group Research 4,000 5,000 6,000 7,000 8,000 9,000 10,000 11,000 12,000 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012E 2013E 2014E 2015E 2016E 2017E NumberofUrgentCareCenters Year 61
- 62. This surge in access is funded by big backers 62
- 63. And many health systems are launching their own branded urgent care centers 63
- 64. But retail/urgent is just the first salvo– telehealth is also coming of age 64
- 65. And telehealth platforms are rapidly increasing in sophistication 65
- 66. As patients take virtual care for granted, more complex cases will inevitably be handled 66
- 67. And consumers will demand apps that are every bit as polished as any other consumer-native app Quick Stats: • 6,380 Google Play Store ratings: 4.54 / 5 stars • 1,243 Apple App Store ratings: 4.5 / 5 stars • Net Promoter Score: 58 • Amex: 45 • Netflix: 45 • CVS: 26 • Health insurance avg: 17 • 9,755 Facebook fans • Omada Health: 825 • Propeller Health: 515 67
- 68. We are still in the early innings, but this is all unfolding faster than many expected 68
- 69. And radically increased levels of funding will continue to fuel the patient-as-consumer rocket Private-equity and Venture Capital Activity in Health IT and related Services since 2008 (1) (1) Chart summarizes private-equity and venture capital activity in health IT and related services since 2008, according to the Healthcare Growth Partners database. The data do not include buyout private equity activity. Source: Healthcare Growth Partners Health IT & Health Information Services 2015 Midyear Market Review. $8000 $7000 $6000 $5000 $4000 $3000 $2000 $1000 $0 Total Transaction Value ($mm)Number of Transactions NumberofTransactions TotalTransactionValue 450 400 350 300 250 200 150 100 50 0 2008 2009 2010 2011 2012E 2013 2014 2015P 69
- 70. Value-based payments (MU, PQRS/VBM, MSSP, MIPS, etc.) are here to stay1 Advances in interoperability are allowing for new kinds of partnerships2 The patient-as-consumer movement is rapidly unfolding– developing an intentional strategy for this is crucial3 Key Takeaways 70
- 72. Thank You
Notes de l'éditeur
- Indeed, the share of insured workers with deductibles of $1,000 or more rose to 31% in 2011 from 18% in 2008, Kaiser estimates. http://online.wsj.com/article/SB10001424052702303684004577506393355775750.html
- While we’re observing physicians actually losing their independence, we’re also seeing another macro trend. While independence is diminishing, care is actually moving outside of the hospital. Now, everyone knows that healthcare is a $3 trillion dollar industry sucking up roughly 18% of our GDP. However, one of the more striking trends of the past several years has been the complete collapse of inpatient volumes. Since 2006, there has been a decline in the number of inpatient discharges by 12.6 percent, while the number of ambulatory services has continued to rise rapidly. There are many theories for why this is the case. Some point to technology– for example, coronary angioplasties used to be inpatient procedures, but now 30% of them are done in an outpatient setting- a few years ago, this number was just 5%. Others point to changes in regulation– for example, the rules around admitting patients from emergency departments have gotten dramatically more restrictive, leading to a drop in these admission rates from 27% to 22% across the board. Others point to the decline in elective surgeries as the recession hit and as high deductible plans became more popular– patients in other words became better shoppers. Regardless of the cause, the fact that care is moving out of the inpatient setting, is certainly another significant trend. http://www.medpac.gov/documents/data-book/june-2015-databook-health-care-spending-and-the-medicare-program.pdf?sfvrsn=0
- For just a moment, let’s remind ourselves why the government cares at all. The essential reason is that healthcare spending is by far the most quickly growing slice of the federal budget, and by 2045 spending on healthcare and social security will equal the entirety of the government’s tax revenues. Everyone sees this coming, and that’s why there’s such a panic unfolding on how to stop it.
- First, the government.
- So what have they been doing about this? Through regulatory mechanisms, the government has been slowly but surely turning up the heat. Each acronym you hear– PQRS, Meaningful Use, and more– are presaging a steady tightening of physician and hospital reimbursement, up to 13% by the end of the decade. We’ll be coming back to this, because the penalties are nearer and more severe than you might think. Objects in the mirror are closer than they appear.
- “As a very large payer in the system, we believe we have a responsibility to lead," said Health and Human Services Secretary Sylvia Mathews Burwell in a press conference. "For the first time, we’re going to set clear goals and establish a clear timeline for moving from volume to value in the Medicare system.” As an example of how close the government is really getting: in January, CMS announced officially that it wants to get more aggressive about tying payments to quality. By 2018, the Obama administration wants half of all Medicare payments to flow through value-based entities like ACOs, up from 30% today. And it wants 90% of all Medicare payments to be tied in some way to quality. That is, one way that you could accomplish a bending in the healthcare trend might be to make blunt cuts– that is, simply continuing to increase the sequester, year after year. But rather than strictly blunt cuts, the government wants to tie these cuts to certain quality measures, so that high-quality, low-cost providers are rewarded and low-quality, high-cost providers are penalized.
- http://www.pyapc.com/wp-content/themes/pya/images/sliders/CCJR-Map-Web-Slider.jpg
- I tried to figure out how to make this simple, but words failed. So I have a request for all of you– embrace complexity. I’ve read through hundreds of pages of regulation, and I don’t expect you to do that. But at least for a moment here, let’s geek out to understand how the carrots are becoming sticks.
- First, the PQRS and Meaningful Use incentives are becoming penalties. PQRS was an approximately .5% bonus, but now you get an automatic hit if you don’t register. We have already been automatically enrolling all of our Clinicals groups into the PQRS quality program to avoid this penalty. But for those that don’t, it’s a 2% automatic penalty starting this year. Also, Meaningful Use is not a one-time event. It’s like a diet– once you’re on the treadmill, you can’t get off without severe penalties. In particular, once you get on the treadmill, you have to stay MU-certified for the forseable future ore else you’ll get a nasty shock. Meaningful Use in the gift that keeps on giving.
- The value-based modifier program is a more recent program that’s built on top of PQRS. Remember what I said about the government wanting a finer instrument, to reward low-cost/high-quality providers and penalize others? Well, the value-based modifier is one such scalpel. Under this arrangement, all of the PQRS scores are input into an algorithm that roughly scatterplots each provider (TIN) or group onto a 3x3 matrix of low/medium/high cost and low/medium/high quality. This scatterplot is then overlaid onto a grid. then determines their fee modifier. So in this case, based on 2015 performance, if a group or provider high cost/low quality, it’ll be hit with a 4% penalty. Of course, on the flip side, there’s also the opportunity to get a 4% fee schedule bump. Non-reporters: 2% penalty for small groups, 4% automatic penalty to 10+ size groups Starting in 2013, CMS began to phase in a new program known as the Value based Modifier or “VM” for short. Each year, practices are provided with a Quality and Resource Use Report (QRUR), whereby CMS uses a practice’s data reported from the PQRS program in conjunction with the data found on patient’s Medicare claims to score on two metrics: 1) Cost 2) Quality On the slide is an example of a QRUR for a group. Each blue dot represents a peer practice like your own. From the graphical representation, one can infer that the majority of the practices fell within national average or that cream/beige box in the center. A practice can use the report to see where they fall in performance and CMS uses the report to determine their Medicare payment adjustment. Our clients should know how they were ‘scored’ in 2014 (based on 2013 data) In late summer 2014, CMS sent QRURs based on care provided in 2013 to all groups and solo practitioners. h Practices will be automatically penalized 2% of their Medicare Part B allowable in 2017 if they fail to report PQRS in 2015
- The value-based modifier program is a more recent program that’s built on top of PQRS. Remember what I said about the government wanting a finer instrument, to reward low-cost/high-quality providers and penalize others? Well, the value-based modifier is one such scalpel. Under this arrangement, all of the PQRS scores are input into an algorithm that roughly scatterplots each provider (TIN) or group onto a 3x3 matrix of low/medium/high cost and low/medium/high quality. This scatterplot is then overlaid onto a grid. then determines their fee modifier. So in this case, based on 2015 performance, if a group or provider high cost/low quality, it’ll be hit with a 4% penalty. Of course, on the flip side, there’s also the opportunity to get a 4% fee schedule bump. Non-reporters: 2% penalty for small groups, 4% automatic penalty to 10+ size groups Starting in 2013, CMS began to phase in a new program known as the Value based Modifier or “VM” for short. Each year, practices are provided with a Quality and Resource Use Report (QRUR), whereby CMS uses a practice’s data reported from the PQRS program in conjunction with the data found on patient’s Medicare claims to score on two metrics: 1) Cost 2) Quality On the slide is an example of a QRUR for a group. Each blue dot represents a peer practice like your own. From the graphical representation, one can infer that the majority of the practices fell within national average or that cream/beige box in the center. A practice can use the report to see where they fall in performance and CMS uses the report to determine their Medicare payment adjustment. Our clients should know how they were ‘scored’ in 2014 (based on 2013 data) In late summer 2014, CMS sent QRURs based on care provided in 2013 to all groups and solo practitioners. h Practices will be automatically penalized 2% of their Medicare Part B allowable in 2017 if they fail to report PQRS in 2015
- Add it all up, and 11% of Medicare payments are at risk based on 2015 performance. Let me say that again: 11% of Medicare payments are at risk based on this year’s performance. That’s a material number for many practices. A couple of weeks ago, I was talking with the CEO of a community hospital in NY. He said that while things were tough, he had been doing just fine, running a 2% margin for Medicare. And then a few of these things hit, and suddenly he was running a -2% margin and couldn’t figure out how to make the numbers work. And that, in turn, directly led to him seeking a partnership with a larger health system– so he sold the hospital along with its 60-physician medical staff. This is real stuff, and it’s affecting our clients and prospects today.
- ACO providers do not fall in the PQRS or VM requirements. Now let’s see how this all fits in with ACOs. Recall that that CMS just announced that it wants 50% of payments flowing through value-based mechanisms by 2018? The major categories here are Medicare Advantage and the Medicare Shared Savings Program, or MSSP. Under the MSSP, the mechanics of the bonus payment depend substantially on what’s known as the ACO 33– 33 key measures that define how well the ACO is doing from a quality perspective. Again, they’re broken into 4 key domains… and these domains should start to look familiar: patient/caregiver experience, care coordination, preventive health, and at-risk populations. I want to dig a little into the details here because it’s so important to understand. For example, just this first one, you have “timely care, appointments, and information”– could I get an appointment in the timeframe I wanted? That’s right– CMS is beginning to directly tie payments to whether patients can get their appointment in a timely way. And if you read down the list, you’ll start hearing about hear about other items such as flu/pneumonia prevention. Interestingly, you’ll see lots measures that should sound familiar from Meaningful Use, such as smoking cessation status. In fact, an ACO must demonstrate, in year 2 and 3, that it has met 33 quality standards before it can share in any savings achieved. Quality can be achieved on a sliding scale based on percentile. http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/RY2015-Narrative-Specifications.pdf
- ACO providers do not fall in the PQRS or VM requirements. Now let’s see how this all fits in with ACOs. Recall that that CMS just announced that it wants 50% of payments flowing through value-based mechanisms by 2018? The major categories here are Medicare Advantage and the Medicare Shared Savings Program, or MSSP. Under the MSSP, the mechanics of the bonus payment depend substantially on what’s known as the ACO 33– 33 key measures that define how well the ACO is doing from a quality perspective. Again, they’re broken into 4 key domains… and these domains should start to look familiar: patient/caregiver experience, care coordination, preventive health, and at-risk populations. I want to dig a little into the details here because it’s so important to understand. For example, just this first one, you have “timely care, appointments, and information”– could I get an appointment in the timeframe I wanted? That’s right– CMS is beginning to directly tie payments to whether patients can get their appointment in a timely way. And if you read down the list, you’ll start hearing about hear about other items such as flu/pneumonia prevention. Interestingly, you’ll see lots measures that should sound familiar from Meaningful Use, such as smoking cessation status. In fact, an ACO must demonstrate, in year 2 and 3, that it has met 33 quality standards before it can share in any savings achieved. Quality can be achieved on a sliding scale based on percentile. http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/Downloads/RY2015-Narrative-Specifications.pdf
- Employer costs are skyrocketing
- Employer costs are skyrocketing
- This idea of defined benefit is a massive trend and will take the country by storm over the next decade Of the 180,000 Walgreen employees eligible for healthcare insurance, 120,000 opted for coverage for themselves and 40,000 family members. Another 60,000 employees, many of them working part-time, were not eligible for health insurance. Aon Hewitt says other participants in its program include retailer Sears Holding Corp and Darden Restaurants Inc. These new additions raise enrollment to 330,000 from 100,000 last year, and Aon Hewitt estimates enrollment will jump to 600,000 next year, a fivefold increase from 2012. By 2017, nearly 20 percent of employees nationwide could get their health insurance through a private exchange, according to Accenture Research. A recent report by the National Business Group on Health said that 30 percent of large employers are considering moving active employees to exchanges by 2015. Goldman Sachs analyst Matthew Borsch said in a research note that the shift to these exchanges could be a positive for insurers if it enables them to sell more profitable, fully insured plans." Other major providers of private exchanges include Mercer, a division of Marsh & McLennan Companies Inc, and Towers Watson & Co. Mercer said this summer that it had five major employers enrolled but did not name them. Towers Watson is in the process of launching an exchange. Smaller companies, like Buck Consultants, Willis North America Inc and regional players, are also starting exchanges. CHANGES IN COVERAGE The five plan choices in Aon Hewitt's private exchange carry names used across the sector - bronze, bronze plus, silver, gold and platinum - and costs are based on the amount of coverage, says Ken Sperling, Aon Hewitt's national health exchange strategy leader. Bronze and silver plans typically have high individual deductibles - $1,250 or more - meaning that they do not kick in until a participant's out-of-pockets costs exceed the amount of the deductible. Gold and platinum plans have lower deductibles and offer more coverage. Healthcare premiums for these plans rose about 5 percent last year, consistent with the industry average recently calculated by the National Business Group on Health. For some employees the exchanges could offer more choice. Walgreen's employees eligible for healthcare coverage were asked in the past three years to choose between two plans, both with high deductibles. Those plans were managed by Blue Cross Blue Shield or United Healthcare, depending on the area of the country. Walgreen's offering last year matched the silver plan on Aon's exchange, so there are two options that are less expensive and two that are more expensive. Based on Aon Hewitt's data collected so far, about 42 percent of participants chose a plan less expensive than they had previously used, while 26 percent chose a higher-cost plan and 32 percent stayed at the same level.
- Source: http://www.pritzkermilitary.org/files/cache/c90ad7e68672a25c30d0a0e71c3e89e6_f966.jpg
- Improving Orthopedic Value from the Buy Side – Perspectives From The Alliance March 28, 2014 Not-for-profit, employer-owned cooperative Shareholders = customers Founded in 1990 by 7 employers; now over 200 employers 90,000 employees and family members 23 counties in WI, IA and IL $500,000,000 in health care/yr Move health care forward by controlling costs, improving quality and engaging individuals in their health
- Broad – 70% or more hospitals participate in a rating area Tiered – Different tiers with different co-pay requirements for different hospitals Narrow – 31-70% of hospitals participate in a rating area Ultra-narrow – Less than 30% of hospitals participate in a rating area Limited network product – 70% of hospital networks on exchanges are narrow or ultra-narrow Iorah health – people are willing to switch doctors they just don’t want to be frozen out of the downstream networks because if something happens they want to make sure they have a choice Networks with different classes of PCP, narrow primary care and broad specialist, everyone is in-network as long as your PCP thinks it’s good for you, want to be able to go to the doctor I want
- Especially true internationally, these specialized providers profit from doing what they’re best at & forgetting the rest “Experience matters, diagnosis and treatments should be increasingly specialized” - Michael Porter & Elizabeth Teisberg Capital intensive Depends on being able to raise prices Requires paying docs more than they make Reversing a 25% clinical inefficiency and 50% admin inefficiency assoc w/ employment ½ day per 100 lives trend in inpatient care decline
- Especially true internationally, these specialized providers profit from doing what they’re best at & forgetting the rest “Experience matters, diagnosis and treatments should be increasingly specialized” - Michael Porter & Elizabeth Teisberg Capital intensive Depends on being able to raise prices Requires paying docs more than they make Reversing a 25% clinical inefficiency and 50% admin inefficiency assoc w/ employment ½ day per 100 lives trend in inpatient care decline
- ----- Meeting Notes (4/17/15 16:22) ----- Show logos of all the organizations that are part of the project.
- My vote is for PATIENT ACCESS and there’s data to back me up! In an Advisory Board study published last year on the rise of Consumerism in Health Care, patients when asked consistently rated ACCESS and CONVENIENCE higher than quality and other attributes when deciding on a PCP. Six out of ten things they cared the most about were tied to ACCESS! With top one being “I can walk in without an appointment, and I’m guaranteed to be seen within 30 minutes.” (SOUND LIKE A RETAIL CLINIC TO YOU??)
- Partnership with Steward whereby front desk person at Doc Express can schedule patient direct into a Steward PCP or specialist - DocExpress is obsessed with access and efficiency - Avg. wait time is under 8 min. - Avg. door to door time for patients is 45 min. - Patients register via mobile tablet, saving 2 1/2 minutes per patient - AND it¹s 1/5 the cost of the ED - We set up DE with a Coordinator Portal BEFORE: if a patient needed to see a PCP or specialist would have to call around to docs, then print out a sheet for the patient and send them on their way; then would have to call patient 48 hrs. later to see if they went. NOW: Pull up portal and see open appointments by distance from patient home, direct schedule typically same- or next-day; appointment can get sent to patient¹s Outlook calendar; patients can see PCP within 1-2 days (compared with X elsewhere); don¹t have to call because they can see that the visit took place. - Less work for DocExpress staff, saving time/money; Getting patients sent to them after hours by Steward - Steward gets more patients and fills appointments - Patients are happier and patients without PCPs are getting them GREAT STORY: - patient injured their calf at gym, went to large Boston AMC for care and was told it was just a bruise - Came into DocExpress next day because it was hurting badly; Urgent care doc diagnosed snapped Achilles - Scheduled into Steward next day for MRI and emergency surgery
- redo
- redo
- Image sources: http://www.vivaveltoro.com/2014/07/doctorondemand.html http://divinelifestyle.com/american-well-see-a-doctor-from-the-comfort-of-your-home-for-49-free-visit/
- The chart below summarizes quarterly private-equity and venture capital activity in health IT and related services since 2008, according to the Healthcare Growth Partners database. The data below and in this section do not include buyout private equity activity, which is included in our M&A dataset. Healthcare Growth Partners monitored an annualized 394 capital raise transactions in the first half of 2015, which would be the highest number of annual transactions since HGP’s monitoring began in 2005 (surpassing the 389 transactions in 2014).
- Even if you don’t invest more in patient engagement, your competitors will! This trend will be with us for the next decade. CMS and payer are pushing you closer to patients so patients can be more informed about their care. Care coordination: you are either “in” or “out”. You want to be “in” the networks that are being built. Interop: