Partnership for Healthcare Payment Reform

1. Partnership for Healthcare Payment Reform WHIO Symposium May 13, 2011

2. Goals of WHIO • To aggregate health care data from sources across Wisconsin to create a single reliable data source to be used by multiple stakeholders to examine variations in efficiency, quality, safety and cost • To improve the quality, cost, safety and efficiency health care in Wisconsin by sharing the results with providers, purchasers and consumers • To support provider quality improvement initiatives • To encourage value-based health care choices by consumers

3. WHIO Members and Subscribers • The Alliance • Anthem Blue Cross and Blue Shield of Wisconsin • Greater Milwaukee Business Foundation on Health • Humana • United Healthcare of Wisconsin • WEA Insurance Trust • WPS Health Insurance • Wisconsin Collaborative for Healthcare Quality • Wisconsin Hospital Association • Wisconsin Medical Society • Wisconsin Department of Employee Trust Funds • Wisconsin Department of Health Services • Aspirus • Aurora Health System • Bellin Health • Dean Health Plan • Group Health Cooperative South Central Wisconsin • Gundersen Lutheran Health Plan • Health Tradition Health Plan/Mayo • MercyCare Insurance • Network Health Plan • Physicians Plus Insurance • Prevea Health Plan • Security Health Plan • ThedaCare • Unity Health Plan • UW – Population Health Institute

4. Using the Data:Wisconsin Payment Reform Initiative Launched with the premise that: • Aligning the incentives of payers, providers, employers and patients, • Measuring quality and cost of care at a granular level, and • Publicly reporting outcomes Will: • Improve the quality of care delivered and reduce its cost by rewarding those who reduce waste and develop more effective, efficient processes

5. And This is Important Because… • Health care spending now tops 18% of US GDP • Premium growth crowds out wage increases, is unsustainable for employers • 1:6 (50+ million) Americans is enrolled in Medicaid • 1:6.5 (47+ million) Americans is enrolled in Medicare • 1:6 (50+ million) Americans is uninsured

6. History of WPRI • November 2009 – WHIO creates WPRI Steering Committee • April 2010 – Steering Committee hosts WPRI Leadership Summit • 170 “C – Level” leaders from stakeholder organizations • Agreed to form Acute, Chronic, Preventive Care Workgroups to develop pilot projects • Hypothesis: The outcomes for patients treated for a specific condition will improve, and costly complications or exacerbations of the patient’s condition will be avoided, if the payment system fosters competition among providers at the level of the medical condition based on the quality of care delivered and the total cost of services.

7. Pilot Conditions • Acute Care chose total knee replacement • Chronic Care chose adult diabetes • Preventive Care chose composite measure of screenings for: • Breast Cancer • Cervical Cancer • Colorectal Cancer

8. Partnership for Healthcare Payment Reform Our Mission: The Partnership for Healthcare Payment Reform supports the voluntary engagement of Wisconsin’s diverse healthcare stakeholders in assessing, designing, testing and implementing innovative, comprehensive approaches to healthcare payment reform in order to improve the quality and affordability of healthcare in Wisconsin and advance the health status of Wisconsin residents.

9. Guiding Principles/Values Collaboration: We rely on shared sense of purpose among participants Openness/Transparency: Communicate learnings, engage all parties. Patient Centeredness: Payment reform should enhance patient experience of care. Synergy: PHPR will provide relevant, Wisconsin-based leadership, building on national trends

10. Guiding Principles/Values Evidence-based: Use data to select high value projects; assess promising practices Continuous Learning: Our understanding of what best supports value in healthcare continues to evolve Impact: Pilot approaches that are both replicable and scalable

11. Why Are 60+ Organizations Participating in Design Efforts? • Opportunity to align incentives among payers • Maximize purchasing strategies • Collaborative nature of the work—building on Wisconsin’s tradition and healthcare assets • Shared learning • Commitment to quality • Opportunity to test “what we know we have to do” • Sense of responsibility/duty to sustainable healthcare system

12. Current Status: Acute Care Pilot • Bundled payment for total knee replacement (single knee) • Commercially insured patients ages 18 – 64 • Includes 90 day warranty period to cover complications, device failure

13. Why Pilot Bundled Payments? • Bundled payments have been shown to improve quality and efficiency of care* • Medicare scheduled to pilot episode of care bundled payments beginning January 1, 2013 • Few multi-payer bundled payment efforts in the country—Wisconsin can lead the way • Participation in PHPR bundled payment pilot allows manageable testing of larger payment reforms to come *See, e.g., http://www.gao.gov/new.items/d11126r.pdf; Cromwell J, et al., Cost savings and physician responses to global bundled payments for Medicare heart bypass surgery. Health Care Financ Rev. 1997 Fall;19(1):41-57.

14. Acute Care Pilot Overview What Services? • Bundled payment for Total Knee Replacement (one knee) • Episode period begins at admission and concludes 90 days from hospitalization • Revision procedure performed during episode period resulting from patient complications or device failure • Patient complications arising during anchor admission • Treatment of complications related to either anchor or revision admission (any service setting) • Readmission during the 90-day episode period for listed DRGs

15. Acute Care Pilot Overview, cont’d. Who’s Included? • Patients presenting for the index procedure without: • Clinical history that demonstrates a clinical condition of active cancer, HIV/AIDS, or End Stage Renal Disease • Body Mass Index (BMI) of 40 or greater • Over age 18 and under age 65 on the date of surgery • Covered (as primary plan) by a participating employer and health plan at the time of admission

16. Acute Care Pilot Overview, cont’d. How Will Bundled Payments Work? • “Bundler” (hospital, IPA, PHO) negotiates bundled payment • Provider bills upon patient discharge and at end of episode period • Payer pays negotiated amount to “bundler” • “Bundler” distributes payment to TKR bundle team members

17. TKR Bundle Quality Measures

18. Acute Care: Next Steps • Expressions of interest requested by May 20 or as soon as feasible • Targeting go-live of September 1, 2011 • Workgroup meeting this afternoon open to potentially interested pilot participants

19. Current Status:Chronic Care Pilot Project • Adult diabetics covered by commercial plans • WCHQ quality measures • Begin with shared savings and transition to global payment over time • Payers retain insurance risk; providers take clinical/performance risk • Consider opportunities to work on local community engagement around nutrition, physical activity, obesity prevention/reduction

20. Why Pilot Shared Savings/Episode of Care Payments? • Condition-based, episode of care payments are expected to improve quality and efficiency of care* • Pilots propose to start with shared savings and transition to full global payment • Participation in PHPR chronic care payment pilot allows manageable testing of larger payment reforms to come • Few multi-payer episode of care payment efforts in the country—Wisconsin can lead the way *See, e.g., http://www.ncbi.nlm.nih.gov/pmc/articles/PMC554918/; http://www.commonwealthfund.org/Content/Publications/Issue-Briefs/2008/Jun/Evidence-Informed-Case-Rates--Paying-for-Safer--More-Reliable-Care.html?doc_id=689893

21. Diabetic Services Bundle • Adults 18-64 with diabetes • Without HIV, cancer, suicide, ESRD, pregnancy • Include the following ICD-9-CM codes: • 250.xx, v45.85, v53.91, v58.67, v65.46 • Establish outliers to exclude expensive surgical claims

22. Chronic Care: Payment Model

23. Diabetic Pilot Outcomes Measures

24. Chronic Care Pilots and Three-Part Aim • Three goals for health as defined by IHI, National Quality Strategy, etc. (sometimes called the “Triple Aim” or three-part aim): • Better Care: Improve the overall quality, by making health care more patient-centered, reliable, accessible, and safe. • Healthy People and Communities: Improve the health of the population by supporting proven interventions to address behavioral, social, and environmental determinants of health in addition to delivering higher-quality care. • Affordable Care: Reduce or at least control the cost of quality health care for individuals, families, employers, and government.

25. Chronic Care Pilots and Three-Part Aim, cont’d. • Local communities may have prevention efforts (e.g. nutrition/physical activity plans) in place—pilot participants can leverage existing efforts • PHPR welcomes the opportunity for further discussion with interested pilot participants

26. Chronic Care Next Steps • Finalize service package, pilot materials • Expressions of interest requested by June 1 or as soon as feasible • Targeting go-live of October 1, 2011 • Workgroup meeting this afternoon open to those potentially interested in being pilot participants

27. Current Status: Preventive Care Pilot Project • Commercial patients • Eligible for routine screenings for breast, cervical and colorectal cancer • In December, WHIO Board asked Preventive Workgroup to explore suitability as a payment reform project

28. Preventive Care Deliberations • Whose behavior most needs to be influenced (Provider? Patient?) to increase compliance? • What incentives or other strategies are best employed to increase rates of cancer screenings? • Now that cancer screenings are provided at no cost to patients under the ACA, what barriers remain?

29. What Gets in the Way of 100% Compliance?Courtesy of WPS Insurance • Major Screening Barrier • Had bad experience in the past (n=70, 17 percent) • Unable to get a convenient appointment time (n=50, 12 percent) • Don’t want to think about the possibility of breast cancer (n=33, 8 percent) • “Cost” factor issue is a minimal barrier (n=2, <1%) Source: Managed Care, April 2009: Barriers to Breast Cancer Screening In a Managed Care Population

30. Preventive Care Next Steps • WHIO Board direction: • Early detection of cancer is important but falls outside of original purpose of payment reform initiative • Pend further development of Preventive Care cancer screening payment reform pilot until results of no-cost screenings under ACA are better understood • In 2011, WPS and partners will further explore: • Lessons learned with military • What education, incentives are needed to improve patient compliance? • Relative cost of screenings; centers of excellence? • How is total cost of care affected by more asymptomatic screenings • Attend workgroup meeting this afternoon to learn more • Volunteers welcome

31. What Are We Learning From Others? • Integrated Healthcare Association, California • http://www.iha.org/ • Mission: To create breakthrough improvements in health care services for Californians through collaboration among key stakeholders. • Blue Cross/Blue Shield Alternative Quality Contract, MA • http://www.bluecrossma.com/visitor/pdf/alternative-quality-contract.pdf

39. What Will It Take to Succeed? • Full CEO engagement • Commitment by all participants to prioritize pilot, including understanding that resources will need to be committed, and there are costs and benefits to participation • Clean, complete claims and eligibility data • Timely, actionable data feedback • EMR • Sense of urgency • Meaningful incentives • Reliable, accepted measures

40. PHPR Support for Pilots • Bundle definition • Quality measures and reporting processes • Model contract language • Resources from other payment reform efforts around the country • Initial interface between pilots and WHIO/Ingenix, other technology vendors • Support (if requested)of activities pilot participants may wish to engage in, including: • Steering Committee of representatives of participants in each pilot site • Best practice sharing across pilot sites; hosting “learning laboratory” opportunities

41. What Else Will It Take to Succeed? • Leadership: • No external imperative • Lots of other things to do • Future is uncertain • Not just about the choir, but the parishioners too • Sense of Urgency: • Could be in design mode forever • Easy for small pilot project to get lost in the shuffle

42. What Else Will It Take to Succeed? • Honesty: • Not a conversation about scarcity and threat, but holistic look at overuse, underuse, misuse • Patient engagement • Stewardship: Stepping up to opportunity to influence complex, multi-faceted problem • It is not all about the _______ (physicians, drug companies, insurance companies, patients, medical technology vendors….) • It’s about everyone accepting responsibility for a sustainable health care system

43. What’s Next for PHPR? Phase 1: • Implement • Track results • Make adjustments • Promote wider adoption

44. What’s Next for PHPR? Phase 2 Options Include: • Apply payment models to other conditions • Map other payment models that can apply across conditions • Identify ongoing initiatives where payment reform would be useful strategy • Explore ACO options

46. “Health Policy Brief: Update - Accountable Care Organizations. Health Affairs, August 13, 2010 http://www.healthaffairs.org/healthpolicybriefs/

47. The Partnership for Healthcare Payment Reform Thanks Its Sponsors… • The Alliance • Anthem Blue Cross Blue Shield of Wisconsin • The Business Health Care Group of Southeast Wisconsin • Dean Health System • Greater Milwaukee Business Foundation on Health • Gundersen Lutheran Health System • Hayward Area Memorial Hospital and Waters Edge • Hospital Sisters Health System • Humana • Meriter Health Services • MetaStar, Inc. • Monroe Clinic • Network Health Plan • Prairie du Chien Memorial Hospital • ProHealth Care • Rural Wisconsin Health Cooperative • Sacred Heart Rehabilitation Institute • Security Health Plan • ThedaCare Center for Healthcare Value • UnitedHealthcare of Wisconsin • University of Wisconsin Population Health Institute • WEA Trust • WHEFA • Wisconsin Academy of Family Physicians • Wisconsin Department of Health Services • Wisconsin Manufacturers & Commerce, Inc. • Wisconsin Hospital Association • Wisconsin Medical Society • WPS Health Insurance

48. …And Its Volunteers • Acuity • The Alliance • Amery Regional Medical Center • Anthem Blue Cross Blue Shield • Appleton Cardiology Associates • Aspirus • Aurora • Briggs & Stratton • Business Healthcare Group • Children’s Community Health Plan • City of Milwaukee Health Department • Columbia St. Mary’s Hospital • Dean Health Plan • Family Health Center of Marshfield, Inc. • Greater Milwaukee Business Foundation on Health, Inc. • Group Health Cooperative of South Central Wisconsin • Mile Bluff Medical Center • Holy Family Memorial, Inc. • The HOPE of Wisconsin • Hospital Sisters Health System • Hufcor, Inc. • Humana, Inc. • Ingenix • Journal Communications • Lakeshore Medical Clinic • Lakeview Specialty Hospital & Rehabilitation • Literacy Network • Manpower Group • Marshall & Ilsley Corporation • Marshfield Clinic

49. …And Its Volunteers • Medical College of Wisconsin • Medical Society of Milwaukee • MetaStar, Inc. • Ministry Health Care • Ministry Medical Group • Ministry St. Joseph’s Hospital • Monroe Clinic • Network Health Plan • New London Family Medical Center • Northeast Wisconsin Health Value Network • Oconomowoc Memorial Hospital • Orthopedic Associates of Wisconsin • Prairie du Chien Memorial Hospital • ProHealth Care, Inc. • Robert W. Baird & Company • Rural Wisconsin Health Cooperative • Sacred Heart Hospital • St. Joseph’s Hospital • Seats, Inc. • St. Mary’s Hospital • ThedaCare Center for Healthcare Value • Trilogy Insurance • United Healthcare of Wisconsin • Unity Health Plans Insurance Corporation • University of Wisconsin – Milwaukee • University of Wisconsin Hospitals and Clinics • WEA Trust • Wheaton Franciscan Healthcare • Wisconsin Academy of Family Physicians • Wisconsin Collaborative for Healthcare Quality

50. …And Its Volunteers • Wisconsin Department of Health Services • Wisconsin Health Information Exchange • Wisconsin Health Information Organization • Wisconsin Hospital Association • Wisconsin Manufacturers & Commerce • Wisconsin Medical Society • WPS Health Insurance • Zimbrick, Inc.