Health IT & Informatics in the Accountable Care Era

James M Crawford, MD, PhD jcrawford1@nshs.edu

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Notice of Faculty Disclosure

In accordance with ACCME guidelines, any individual in a position to influence and/or control the content of this ASCP CME activity has disclosed all relevant financial relationships within the past 12 months with commercial interests that provide products and/or services related to the content of this CME activity.

The individual below has disclosed the following financial relationship(s) with commercial interest(s):James M Crawford, MD, PhD:

Vice Chair, Managing CommitteeBiomedical Research Alliance of New York (BRANY)

– a clinical trials CROno impact on the content of this CME activity

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Anatomic Pathology: Articles of Faith

We provide “Patient Centered Care”.

We are indispensable for Patient Care.

Declining payments for Laboratory Services

Inexorable increases in expense

Current Assumption

Costs of Laboratory Testing shifted to Beneficiaries

Or is it?

Declining Payer reimbursal to LabsVolume-based cost reductions: Large Labs only

= Profit(for whom?

“Shared Risk” for valuation of lab testing

Efficient costing of laboratory services= Margin

Rebalancing

UtilizationInterpretation

Care Coordination

? Anatomic Pathology ?

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Anatomic Pathology: Threats

We are soon to change from “source of revenue” to “medical loss ratio”.

We will be viewed as “over-utilization”. We can be outsourced to the lowest bidder.

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Anatomic Pathology: The Challenge

Can Anatomic Pathology document its “value” in the Accountable Care Era?

Can Academic Pathology demonstrate that it is the Provider-of-Choice?

By what means? Cost-per-test Reduced utilization Intelligent use of Advanced/Molecular Diagnostics Better Health IT connectivity and Reporting Clinical Informatics and Clinical Decision Support Better cost outcomes for stakeholders Better healthcare outcomes for the population

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Anatomic Pathology: The Challenge

Can Anatomic Pathology document its “value” in the Accountable Care Era?

Can Academic Pathology demonstrate that it is the Provider-of-Choice?

By what means? Cost-per-test Reduced utilization Intelligent use of Advanced/Molecular Diagnostics Better Health IT connectivity and Reporting Clinical Informatics and Clinical Decision Support Better cost outcomes for stakeholders Better healthcare outcomes for the population

IntellectualFulfillment

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Anatomic Pathology: DATA

What data should Anatomic Pathologists bring forward? To Whom?

What leadership should Academic Anatomic Pathology (ADASP) provide?

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Anatomic Pathology: Health IT

Requisitions: Indications, Clinical Hx, Clinical images, Coding Logistics, Tracking, Status reports, Troubleshooting

Reports: Formatting, Integration, Digital Imaging, Molecular Delivery to Clients: Ordering Physician, Other Physicians Effective up-loading to EHRs, Displays, Structured Data

Client Service tracking systems, response time Telepathology

Digital Image Streaming Digital Slide Scanning Digital Image Analysis In Vivo Microscopy

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Anatomic Pathology: Informatics

Quality Reporting (manage on the basis of your data!) Turn-around Time Frozen Section Discrepancies Consult case concordance Benchmarks against national standards (viz. Cytopathology)

Client Service metrics Population Health

Screening Population Diagnostics (for every client) Follow-up (e.g., Pap-test → Biopsy)

Genomics: Molecular Imaging Advanced Molecular Diagnostics

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Anatomic Pathology: Business Informatics

Can you justify your AP services?Cost

AccuracyClient SatisfactionPatient Outcomes

The Patient’s Voice

Quality “Is your testing better?”

Service “Are you attentive to my needs?”

Price “Am I paying the correct amount?” (premium dollar, co-pay)

VALUE

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The Changing HealthcareDelivery Landscape

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The Changing HealthcareDelivery Landscape

Whither goeth Anatomic Pathology?

?

?

?

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Your “Value” as a Laboratory

Competitive Cost Against the largest national labs

Safety and Quality The highest standards

Service Delivery To PatientsTo Healthcare Providers

Data Delivery To the Electronic Health RecordTo Providers (? Mobile Apps ?)To Patients (Patient Portals)

Data Analytics Financial benefit to the EnterpriseManaged Care ContractingHospital Expense ManagementHealthcare DeliveryPatient Outcomes

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Total $2.5 T Hospital care $661 B ($44B Hospital Lab) Physicians $320 B Drugs $235 B Dentists $ 94 B Outpatient Care Centers $ 43 B Physician Imaging $ 38 B Outpatient Hospital Imaging $ 25 B Medical and Diagnostic Labs $ 18 B (“In Vitro Dx”) Dental Labs $ 4 B Behavioral Health $ 2 B Research $ 44 B

The Costs of Healthcare: 2010

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NSLIJ Labs

Independent &Physician OfficeLabs

Hospital Labs

Quest

LabCorp

12%

8%

10%62%

National Laboratory Market = $62B*

$302M; 0.5%

*Laboratory Industry Outlook 2011, G-2 Report

Managed Care

Opening Gambit “Exclusive contract with national lab”

Clawback Negotiating back to a “Carve-In”

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Managed Care

Opening Gambit “Exclusive contract with national lab”

Clawback Negotiating back to a “Carve-In”

How?

Financial Performance Contribution to Health System

Costs Hospital savingsCost-per-Test

Client Service Patient ExperiencePhysician Satisfaction

Support of ACO Coordinated CarePatient OutcomesOverall cost of Healthcare

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2012: Quotable Quotes

“I want you to be aggressively entrepreneurial.” Jan 2012*

“I do not want you to be averse to risk.” Jun 2012*

“You can’t cut your way to greatness.” Jan 2012**

(Noting that our NSLIJ Laboratories have been evaluatedfor “monetization” in both 2008 and 2011.)

*CEO, **COO, NSLIJ Health System retreats

● ●

●●

●

●

●●●●●

●

●

●

●●

●

●

Hospitals (26% of market)Reference laboratories

300+ practice locationsNetwork of SNFs

●

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NSLIJ: The Road to Success

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NSLIJ Labs: The Car-in-Front

NSLIJ Labs

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CoreLab

HuntingtonForest Hills

FranklinGlen Cove

Southside

Syosset

Plainview

NSUH

LIJ

SIUHNorth

Physician’sOffices

NursingHomes

Clinical TrialsBARC

Non-SystemHospital

ReferenceTesting

Outreach

Hospital Lab RRL

Centralized Laboratory Network Current (CLN)

Staten IslandLab

SIUH South

NJ, Brklyn, SI

Physician’sOffices

NursingHomes

LHH

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0.0

5.0

10.0

15.0

20.0

25.0

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NSLIJ Pathology and Laboratory Medicine

Clinical Laboratory Tests/year: 2012

North Shore-LIJ

Henry FordMayo Clinic

The Cleveland Clinic

Test

s pe

r ye

ar (

mill

ions

)

SIU

HLX

Com

mC

ore-

NS

-LIJ

25

20

15

10

5

0

0

2

4

6

8

10

12

14

16

0

20

40

60

80

100

120

140

160

2008 2009 2010 2011 2008 2009 2010 2011

NSLIJ Core Laboratories

Operating Revenue ($M)

Net Revenue ($M)

2012

2012 Margin: Actual$13.58 M

Budget $11.97 M

2012

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Cost-per-Test

Salaries and Benefits

Reagents

Rent and Utilities

Repairs and Maintenance

Depreciation

Other

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Cost-per-Test

Salaries and Benefits

Reagents

Rent and Utilities

Repairs and Maintenance

Depreciation

Other

VOLUME → Productivity → Efficiency

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Delivering Cost “Value”

1 2 3 40

1

2

3

4

5

6

7

8

9

1 2 3 40.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

Core Lab: Cost-per-Test ($)Core Lab: Volumes (M)

20122011201020092012201120102009

Increasing complexity

MN LIJ FH FK GC HH LX PV SS SI-N SI-S SY0.00

2.00

4.00

6.00

8.00

10.00

12.00

14.00

20082009201020112012

Example: Blood Costs per site

$ (

mill

ion

s)

Total

2008

2009

2010

2011

$ (

mill

ions)

NSLIJ Laboratory Service Line: Cost Management

1 2 3 4 50

5

10

15

20

25

30

35

2012

Laboratory Costs ($$) per Adjusted Discharge

FH FK GC HH LIJ LX MN PV SI SS SY0

100

200

300

400

500

600

700

Non-BloodBlood

2012

Ho

w m

uc

h is

AP

“Tec

hn

ical”?

Laboratory Costs ($$) per Adjusted Discharge

FH FK GC HH LIJ LX MN PV SI SS SY0

100

200

300

400

500

600

700

Non-BloodAPBlood

2012

1 2 3 40

100

200

300

400

500

600

700

NSUH Lab Costs ($$) per Adjusted Discharge$

pe

r A

dju

sted

Dis

cha

rge

2012

54%

dec

reas

e

22%decrease

1 2 3 40

100

200

300

400

500

600

700

OtherAPBlood

2009 2010 2011 2012 2009 2010 2011

12%

incr

ease

7%

dec

reas

e

2012vs.

2009

2012vs.

2009

“stacked” “exploded”

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North Shore University Hospital

Anatomic Pathology: Billing Delays

0

20

40

60

80

100

120

140

160

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

4000000

# cases held in Medical Records Delayed Charges ($)

Oct

200

8Ja

n 20

09 Mar Apr May Jun Jul

Oct

200

8Ja

n 20

09 Mar Apr May Jun Jul

0

$1M

$2M

$3M

$4M

Helping NSUH revenue cycle

Delayed Charges at Discharge

1 2 3 40.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

20122011201020091st Q

$ (

mill

ion

s)

90%decrease

Owing to late Surg Path reporting

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In press

Consolidation of the North Shore-LIJ Anatomic Pathology Services:The Challenge of Sub-specialization, Operations, Quality Management,Staffing and Education

Diane E. Groppi, MTASCP, Claudine E. Alexis, MBA, MTASCP,Chiara F. Sugrue, MS, MBA, MTASCP, Cynthia C. Bevis, MS, MBA, JD, MTASCP,Tawfiqul A. Bhuiya, MD, James M Crawford, MD, PhD

2009 2010 2011 20120

50,000

100,000

150,000

200,000

250,000

8%

Integrated Anatomic Pathology Services (wRVU)

10%34%

0% 22% 26%AP Growth

AP Outreach (% of total)

NS

UH

+ L

IJM

C

NS

UH

+ L

IJM

C

NS

UH

+ L

IJM

C

39%

NS

UH

+ L

IJM

C

Outreach 19% 338% 43%

(year-to-year)

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TC

= E

xpen

se

AP Consolidation Feb 2011

TC

= R

evenu

e

NSUH + LIJMC Anatomic Pathology Services

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1 20%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

8834288173883098830788305

20122009

22%32%

52%

62%

131,183 wRVU 134,381 wRVU%

bill

abl

e te

sts

Improved IHx TAT,Reduced utilization

0

20000

40000

60000

80000

100000

120000

140000

160000

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NSLIJ Pathology and Laboratory Medicine

Surgical Pathology Cases/year: 2012

NSUH-LIJMC

Mount Sinai Medical Center – New York

The Ohio State UniversityThe Cleveland Clinic

University of Pittsburgh

Mayo Clinic

Tho

usan

ds

University of Texas-Houston

2009 2010 2011 2012

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

4,68

5

Integrated Anatomic Pathology Services

wRVU / cFTE: all AP services

4,79

5

5,80

1

7,34

0

NS/LIJ Integration +

Subspecialization21%

27%

Year-to-year

2%

NE Academic Pathology Depts(minus Neuropath, Cytopath)UHC-AAMC Benchmark 2012 45

1 20

2000

4000

6000

8000

10000

12000

14000

16000

18000

Integrated Anatomic Pathology Services

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2012

4.1%

48 Hour TAT: Outreach Biopsies Abandoned Call Rate

TAT

(%

)

1.8%

Tota

l An

nu

al C

alls

2011

1 2 3 4 590

92

94

96

98

100

102

Breas

t

GI

GU

Gyn

Derm

2011 2012

What we have not done

Consistently get our reports to the right physician

Make better Integrated and Structured Reports

Demonstrate that we are performing the “right” numberof Anatomic Pathology procedures

Determine the downstream cost-efficacy of our diagnostics

Report on “Population Metrics” to our Clients

Demonstrate that our % of the “medical loss ratio”contributes meaningfully to Population Outcomes

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Fee-for-Service Strong incentive for utilization*

Shared Risk Utilization is a “cost”

We will have to justify Utilization of our services,and “Valuation” thereof, regardless of Payment Model.*

BUILD YOUR OWN STORY

*and our billing practices are subject to scrutiny

Managed Care

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Anatomic Pathology: ADASP

What leadership should Academic Anatomic Pathology (ADASP) provide?

- Benchmarks for:- Operations- Reporting- Data interoperability- Cost management

- Leadership in:- Relationship of AP to “Coordinated Care”- Relationship of AP to “Population Outcomes”- Role of AP in the “Cost of Healthcare”

- To include: AP management of advanced diagnostics

→ The clinical informatics of Anatomic Pathology

James M Crawford, MD, PhDjcrawford1@nshs.edu

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