Fairleigh Dickinson Executive MBA Health Systems Management

1. Fairleigh DickinsonExecutive MBAHealth Systems Management Managed Care and Provider Reimbursement Robert Eidus MD, MBA

2. May 21 • Final Exam • Population Based Health Management • Preventive Health Services in Managed Care • Demand Management • Case Management • Case Study- Accordant Health Services- • Oral Presentations of Project • Course Summary • Wrap Up and Feedback

3. Case Study • Merck-Medco Managed Care: Michael

4. Current Events Analysis

5. Current Approach Care is based primarily on visits Professional autonomy drives variability Professionals control care Information is a record Decision-making is based on training and experience Do no harm is an individual responsibility Secrecy is necessary The system reacts to needs Cost reduction is sought Preference is given to professional roles rather than the system New Rule Care is based on continuous healing relationships Care is customized according to patient needs and values Patient is the source of control Knowledge is shared and information flows freely Decision-making is evidence based Safety is a system property Transparency is necessary Needs are anticipated Waste is continuously decreased Cooperation among clinicians is a priority Simple Rules for the 21st Century Source: Crossing the Quality Chasm; A New Health System for the 21st century

6. Health Care in the 21st Century Should Be • Safe- avoiding injuries to patients from the care that is intended to help them • Effective- providing services based on scientific knowledge to all who could benefit and refraining from providing services that will not likely benefit them • Patient-centered– providing care that is respectful of and responsive to individual patient preferences, needs, and values, and ensuring that patient values guides all clinical decisions

7. Health Care in the 21st Century Should Be • Timely- reducing waits and sometimes harmful delays for both those who receive and those who give care • Efficient- avoiding waste, including waste of supplies, equipment, energy, and ideas • Equitable- providing care that does not vary in quality because of personal characteristics, such as race, ethnicity, geographic location, and socioeconomic status

8. How is Health Care Rationed in the United States? • Discussion

9. Population based health management People with complex multisystem illness 25-35% of health care costs People with chronic illnesses 30% of health care costs 35% of health care costs Healthy or asymptomatic and at risk for illness

10. Population based health management People with complex multisystem illness Care management (Catastrophic Case Management People with chronic illnesses Disease Management Preventive Health, Demand Management Healthy or asymptomatic and at risk for illness

11. Typical Prevention Interventions • Registries • Reminders • Educational activities • Provider incentives

12. Barriers to effective managed care preventive efforts • Migrating membership • Inaccurate data bases • Lack of point of service effectiveness • Missed opportunities • Physician overload • Lack of systems in providers offices

13. Demand Management • Basic Principle: • 70% of illness is self limited • Much of primary care visits and ER visits are patient initiated; very often due to lack of education/ information • Giving patients information/ advice/ and alternative venues for care can save money

14. Typical conditions which can be managed via demand management • Colds: (avoid a PCP visit) • Asthma, ear infections (avoid an ER visit) • Minor strains/ sprains • Allergies • Urinary tract infections

15. Types of Demand Management Interventions • Algorithmic books and other literature • On-line advice systems • E-health care (future) • Nurse advice lines (advice and triage) • Example: Access Health • After hours clinics and urgent care centers

16. Does Demand Management Work? • Probably- but don’t believe the press you hear • Nurse advice lines are well received by patients, but: • Most patients don’t use them • They are costly • Cost savings may be difficult to calculate, particularly after year one

17. Case Study • Accordant Health Systems:

18. Care Management • Also called case management or catastrophic case management • Operating assumptions • Sutton’s Law • If I can manage the few cases with big ticket items, then I can ease off the micromanagement of the masses

19. Typical Cases Managed • Transplants • Parenteral Hyperalimentation • HIV/AIDS • Premies • Traumatic Brain Injury • Stroke

20. Care Management Toolkit • Discounted contracting • Home nursing, PT, DME, Rehab., Centers of Excellence • Substitution of benefits • Coordination of care • Guidelines monitoring • Telephonic or on-site support

21. Care Management • The bulk of the services are provided by nurses that work for the health plan or an independent company that contracts with the health plan or employer • Nurses are specially trained • Documentation software

22. Care Management Problems • Although most people believe that Care Management helps patients and save money, it is hard to quantify • Small numbers and large dollars give large amounts of variation • You are basing savings on what would have happened had you not intervened

23. Prospective Care Management-A new paradigm • Basic tenet: • Identify people at risk for high medical expenditures before they get sick • People with chronic illness • Depressed • Social Isolation • Poor self efficacy • Poor decision-making skills

24. Web-Site Analysis

25. Course Summary • Managed Care should be differentiated from HMOs • Managed care started in response to a societal need for access • In the last 25 years, the growth has been fueled by a need to control costs • Managed care will continue to respond in the future to the balancing and changing needs of access, coverage, and cost containment

26. Course Summary • Although it seems to be an ideal situation, the development of integrated delivery systems has been fraught with problems • Within the sphere of cost containment, the general tactics are benefits constriction, cost sharing, transfer of risk, incentives, and utilization management • None of these have worked very well alone- together they have helped to modify the escalation of medical costs • The basic factors that contribute to cost escalation are aging of the population, new technology and consumer demand

27. Course Summary • Managed care has made many contributions to improving quality of health care. There is little evidence that the tactics used to contain cost have adversely impacted quality • Despite public statements to the contrary, employers chose health plans based upon cost, not quality • Population based care management has become increasingly popular to prospectively influence outcomes

28. Feedback • What did you like? • What didn’t you like • What would you have liked more of? • What would you have liked less of? • Value of minipresentations

29. Evaluations

30. Thank You