New Jersey Business Group on Health a division of

1. New Jersey Business Group on Healtha division of Working together to improve health and healthcare NJBGH June 8, 2010

2. About NJBGH • NJBGH is an employer-driven coalition dedicated to improving the quality and efficiency of healthcare locally and nationally. • NJBGH will be a division of NYBGH and the only organization exclusively focusing on NJ employer health benefit issues • NYBGH members include more than 175 employers, unions, health plans, providers and other healthcare organizations operating in New York, New Jersey and Connecticut • Since 1982, NYBGH has been leveraging the power of healthcare purchasers to drive healthcare reform and aid employers in their quest for value in the healthcare system

3. What are employers trying to accomplish? What’s the aim? What are employers attempting to accomplish? What’s the aim? • Improved workforce health and productivity • Greater control of the direct and indirect costs associated with workforce illness and disability Both are business imperatives!

4. The US Healthcare System (or non-system): Opportunities Abound The US Healthcare System (or non system): Opportunities Abound • Safety – Tens of thousands die due to medical errors (IOM, 99) • Effectiveness – 50/50 chance of getting appropriate care (McGlynn, 03) • Costs of poor quality – 30% of direct expenditures due to overuse/misuse/waste (Juran & MBGH, 03) • Unexplained Medical Practice Variation – (Wennberg, 1973 – present) • Fragmented Health Delivery • Absence of HIT (Brailer, 05) • Uninsured – Over 40 million people (IOM, 03)

5. But Employers Bewildered But Employers Bewildered A Tale of Two Cities • Worst of Times: Rising disease burden and health care costs puts American Industry at a competitive disadvantage • Best of Times: But industry leaders know that process reengineering, technology, quality management, and a consumer focus can drive improved quality and lower operating costs

6. But Employers to Blame! But Employers to Blame! “As major purchasers of health care services, employers have the clout to insist on change. Unfortunately, they have also been part of the problem. In buying health care services, companies have forgotten some basic lessons about how competition works and how to buy intelligently.” Michael Porter, Professor Harvard School of Business

7. But Employer to Blame! But Employers to Blame! For a Toxic Payment System that pays for: • Volume rather than outcomes • Individual units of care rather than episodes of illness • Acute care not prevention, primary care, disease management • Medical errors and “do overs” • With no performance based payment And for a Consumer Entitlement Mentality • That insulates individuals from cost sensitivity of 3rd party payment

8. If you want to focus on cost, don’t focus on cost, focus on value. -Michael Porter -Harvard Business School 8

9. Value Based Purchasing: Imagining a Path Forward

10. Value Based Purchasing: Measure Report, Reward, Lead Five Pillars: • Performance Measurement • Transparency and Public Reporting • Payment Reform • Informed Consumer Choice/Activation • Purchaser Leadership and Action Accelerating the pace to the Ultimate Goal: Health and Health Care Improvement

11. NYBGH Priorities • Influence • Quality Improvement Programs • Health Plans • Physicians • Hospitals • Purchasing Initiatives • Health Care Policy • Get to Know the CEO • Educate • Programs • Conferences, monthly breakfast meetings • Newsletter • Network

12. Influencing Requires a Regional Strategy • Employees of Manhattan-based companies live in NJ and use the same health plans, physicians and hospitals as employees of NJ-based companies. • Plans and employers need to come together to combine leverage and purchasing power to influence the market

13. Influencing Health Plans • Using eValue8 to assess the performance of health plans in NY, NJ and CT (Aetna, Cigna, United and Anthem) • Health Plan User Groups • Collaborative Health Plan Projects • www.abouthealthquality.org • Regional healthcare report card covers NY, NJ, CT, RI, VT

14. Influencing Physicians • Aggregating health plan data • Aetna, Cigna, United/Oxford, Anthem, Emblem, Horizon • Reports to primary care docs in NJ • List of patients who missed services: Gaps in Care • Increasing Screening and Treatment for Depression in Primary Care • Patient Experience with PCPs • Manhattan pilot with Consumer Checkbook and Aetna, Cigna and United • Helping to organize a multi-payer medical home project in NY

15. Influencing Hospitals • The Leapfrog Group • Voluntary program aimed at mobilizing employer purchasing power to alert America’s health industry that big leaps in health care safety, quality and customer value will be recognized and rewarded. • NYBGH asks hospitals in NY and CT to respond to the Leapfrog survey and NJ Health Care Quality Institute asks NJ hospitals • Getting More Value From Hospital Care • NYBGH is bringing hospitals, plans and employers to the table work on changing the contracting process to be less about discounts and access and more about value.

16. Knowledge is Power • NJBGH will conduct educational programs in NJ for employers and the healthcare community. • Next program will be on Patient-Centered Medical Home in the Fall.

17. NYBGH Accomplishments • Raising the bar on health plan performance through eValue8 • Getting the health plans to work together • Providing PCPs with more comprehensive reports on their ability to deliver best care to patients • Bringing hospitals to the table with employers and plans to improve the quality and value of what we are buying • Providing access to high level decision-makers at health plans and other partners • Keeping members up-to-date on health policy and legislation