Health Care in Colorado – “Buckle Up”

1. Health Care in Colorado – “Buckle Up” • Bill Wright, MD, MSPH, Executive Medical Director & President • Colorado Permanente Medical Group Citywide Medical Discussion Group – March 20, 2013

2. History of Kaiser Permanente • Oldest and largest non-profit integrated delivery system in the country • Founded in 1945—derived from dam and ship building models in late 1930s 1938 Grand Coulee Dam Hospital WWII Kaiser Shipyard Workers, Richmond, CA

4. Who we are… • 9 million members through 125,000 employers • Serving 9 states and District of Columbia • 48 hospitals • 448 medical offices • 164,000+ employees • 15,000+ Permanente physicians • $48.6 billion operating revenue • Community benefit programs: $1.2 billion/year

5. KPCO Roots • 1969 - 44th year in Colorado • 3 docs -Drs. Howard, Blanchett & Reimers • 1 sister – Sister Mary • 700 members

6. KPCO Today • 26 medical offices • 540,000 members • >5,000 staff • 969 physicians

7. Accolades • 2012 Million Hearts Hypertension Control Champion • NCQA • #1 Commercial and #1 Medicare in Colorado • #6 Commercial and #2 Medicare in the nation (out of 395) • Top Ten in 19 HEDIS measures in the country. • JD Powers • Five years in a row • Medicare Five Star • Third year in a row

8. Electronic Medical Record: KPHealthConnect • Largest civilian deployment of an EMR • Comprehensive and convenient views in one place • Allows for proactive preventive care for all members • Alerts provide enhanced patient safety and improved alignment with evidenced based medicine. • Online capabilities • Email your physician • Schedule appointments • View lab results • Prescription refills

9. My Health Manager

10. Beyond the EMR: Health-IT Tools • Registries • Disease Management • Population Health

11. Who is CPMG? • More than 950 physicians • > 80% of care provided by CPMG • 95% board-certified • Shareholders after 3 years • 60% from private practice • 5% turnover in 2012 • 44 years in Colorado • Learning how to “Collaborate” (quality, scorecards, values)

12. CMPG Physician Compensation • Base Salary comparable to median of the market. • Pension - Defined Benefit Plan • Med group-wide variable - Based on regional performance • Additional $ incentive (dept/individual)for meeting quality and access metrics.

14. New Challenges • Cost Conversations in the Exam Room • No longer just HMO • >40% of membership cost-share • Growth • I-25 corridor • Collaborative care • Virtual care (Telephone Advice Visits; Real Time Virtual Consults) • Health Care Reform • coverage, capacity, cost and care • re-engineer

15. Food for thought and discussion

16. Health Care Today is Too Expensive Health Care Reform What Is the Future of Health Care? What Are the Thought Leaders Saying? WhatIs Our Role as Leaders?

17. Cumulative Changes in Health Insurance Premiums, Workers’ Contributions, Inflation, and Workers’ Earnings(1999-2010) Source: Kaiser Family Foundation (KFF) Employer Health Benefits 2010 Annual Survey

18. “Where are the Health Care Cost Savings?”Ezekiel Emanuel, Viewpoint, JAMA, 1/4/2012 • Not in malpractice reform, million dollar babies, insurance company profits, drug costs • 10% of population drives 64% of the cost! (avoidable complications, tertiary prevention, EHR, care coordination 24/7, more efficient use of specialties, etc) • Physicians need to lead, redesign care, embrace payment reform

19. Health Care Cost Continuum 1% of people % of Healthcare Expenditures 100% 80% % of Costs 30% total cost 60% 40% 20% 10% total cost 0% total cost 0% % of People 0% 20% 40% 60% 80% 100%  % of Membership 70% of people 20% of people Source: Milliman USA Healthcare Cost Guidelines, 2001 Claims Probability Distribution, non-KP

20. Have we Physicians become mere merchants selling our wares? August 2011 EMD / communication / proving the value / GA proof point / Newsweek – Sharon Begley Aug 2011, Just Say No!, 19Aug2011

21. Promote conversations between physicians and patients by helping patients choose care that is: • Supported by evidence • Not duplicative of other tests or procedures already received • Free from harm • Truly necessary • “Things Physicians and Patients Should Question” • Consumer Reports is developing patient-friendly materials and is working with consumer groups to disseminate them widely. • More than 35 specialty societies have now joined the campaign, and 17 unveiled new lists in Feb. 2013

22. Colorado (Lockton Survey) • Average medical plan increase in 2012 was 7.4% • Nationwide -> 4% • To mitigate increase >73% will pass some portion of rate increase on to employees (plan design changes and/or premium share increases) • 53% of employers report using deductibles of $1,000.00 or more • (46% last year, and 34% nationally)

23. X “Brain-in-the-Game” “Skin-in-the-Game” Cost-Sharing “Sweet Spot”

24. What is prevention?

25. Health Care Reform Biggest since Medicare disruption

26. Macro-Economic: Reform & the Economy • Medicaid/SCHIP will grow • Medicare revenue cuts (quality bonus partial mitigation) • Economy will drive the discussion • Individual/Small group – Exchange • Larger employers – self-insuring, asking for predictable trends • Out of pocket, exchange focus drives individual consumer focus • Bottomline: • More members, less revenue per member

27. Market Disruption Will Increase Through 2015

28. Real HCR needs to address all the 4 C’s • Coverage • Capacity • Cost • Care

29. The Four R’s of Cost Mitigation • Ration • Re-engineer • Regulate • Re-price 37

30. Stages of Reform • Insurance Reform • Affordable Care Act • Payment Reform • ACOs • Delivery System Reform

32. Legitimate Examples of Accountable Care

33. What do they all have in common? Age (1888, 1920, 1945), that is to say vision Self-Governed Multi-specialty medical groups (>25specialties, >400 docs), true MD leadership, team-care, NOT paid FFS Clinical Information Systems (CIS) = EMR + analysts + reports + action based upon reports Improvement is Embedded in the Culture and Infrastructure (The Best at Getting Better)

34. JAMA, Jan. 2, 2013

35. What Is the Future of Health Care?

36. Paradigm shifts: • Encounter-based (visit) ---------- to information based • Physician-centered ------------ patient-centered • Physician delivered------------Team delivered (patient part of team) • Reactive care ---------------- proactive care • Episode care ------------- continuous care • Population based care ------- personalized care • Mass production ---------- mass customization • Rear-view analytics --------- predictive analytics (“Big Data”) • Silo care ----------- coordinated/integrated care

37. Paradigm shifts continued: • Medical care plans --------- personalized care plans • Isolated quality goals -------- integrated triple aim goals • Quality------------Value • Managing Disease-----------maintaining health • Unwarranted variation--------warranted variation • HC team has information----------everyone has access to information

38. Time to Think Differently Custom Process Custom Process Triage Patient Standard Process Standard Process Source: Managing Custom & Standard (R. Boher, MD, 2007)

39. Why are teams so critical to health care? Medicine has exceeded our individual capabilities as doctors. . .You can’t hold all the information in your head any longer, and you can’t master all the skills . . . System – diverse people actually work together to direct their specialized capabilities toward common goals for patients.” - Atul Gawande, MD American Physician & Journalist

40. Care Delivery Will Change Office Visits Office Visits Other iPad Multi- Disciplinary Smartphone Phone/e-mail Tele-Health Tomorrow ? Today

41. What are the thought leaders saying?Whatis our role as leaders?

42. Predicting the Extinction of Health Insurance Companies Zeke Emanuel, MD – oncologist and former White House advisor, now Vice Provost and Professor at Penn.

43. JAMA, Feb. 20, 2013,

45. What patients really want from health care: (JAMA; Detsky) • Restore health • Timely care • Kindness, empathy, and respect • Hope and certainty • Continuity, choice, and coordination • None or little out of pocket expense • Best medicine: testimonials vs. statistics

46. Population Health Triple Aim IDS Care Patient Team Experience of Care Per Capita Cost

47. Physicians’ Views • Most physicians said they would be compelled to consolidate with other practitioners, become hospital employees, or align with large hospitals and health systems • Emerging practice models will include large Accountable Care Organizations (ACOs), medical homes, large independent groups, large aligned groups, community health centers (CHCs), and small aligned groups • Health reform was necessary and inevitable. Many of these changes would have come without passage of federal health care reform Source: Survey of 100,000 physicians for The Physicians Foundation, October 2010

48. “It is not necessary to change, survival is not mandatory.” - W. Edwards Deming American Engineer & Statistician

49. X Tension Performance Our roles as leaders?

50. “Just Britannica that…” - Bill Wright, MD