Paul Grundy, MD, MPH, FACOEM, FACPM IBM Director Healthcare Transformation

President Patient Centered Primary Care Collaborative

PCMH Level Care 2011

-participant will understand/be able to discuss the important trend

of PCMH in health care

-participant will understand/be able explore the rationale and

supporting evidence for PCMH

- participant will understand/be able understand the impact on

patients, providers and payers

Disclosure:

– I am a full time Emplyee of IBM I WILL NOT discuss any

pharmaceuticals, medical procedures, or devices

I have gratefully had my expenses covered to do some of my talks

about PCMH by Merck, and Pfizer.

Course Objectives

Who was the

Shooter’s Doctor? Away from Episodes of Care - FFS

Population

management !!

Accountability !!

The Cause? Mostly due to unregulated fee-for-service payments and an over reliance on rescue/specialty care. This is stark evidence that the U.S. health care Industry has been failing us for years “Commonly cited causes for the nation's poor performance are not to blame - it is the failure of the deliver system!!”

- Unaccountable Care Organizations

* Peter A. Muennig and Sherry A. Glied Health Affairs Oct. 7, 2010

Dubuque, Iowa

USA 2011 Pennsylvania

The Quaker State Pennsylvania is above the national average on Health Care on

a per capita basis

Ranks 38 (New York is last 50th) of 50 for all states for avoidable hospital use and costs.

Real Transformation must

be pursued in collaboration

across the buyers and payers

Employers, State, CMS, Medicaid.

Change of convenient between

buyers and providers

Animated Short: The Amazing Health Care Arms

Race

http://www.publicradio.org/columns/marketplace/

business-news-briefs/2011/09/oh-the-jobs-youll-

create.html

$10,743

$28,530

+166%

Why Innovate Affordability

Costs continue their upward climb…

…with employers still picking up much of the tab…

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

a - Employer Cost - Employee Payroll Contributions - Employee Out of Pocket Expenses

2001 2009 2019

$4,918

+118%

The Elephant in the room

Slide From Dr Martin Sepulveda

If we truly want to understand costs and where they can be reduced

without compromising outcomes, we need to aggregate costs around

the patient. (need a place to do that – that is PCMH)

The way care is currently organized leads to redundant administrative

costs, unnecessary and expensive delays in diagnosis and treatment,

and unproductive time for physicians.

A system integrator a place where data is aggregated, understood and

held accountable at the level of the individual patient -- THAT IS

PCMH.

In fact, cost reduction will often be associated with better outcomes.

The Big Idea: How to Solve the Cost Crisis in Health Care

by Robert S. Kaplan and Michael E. Porter

Sept 2011 Harvard review

Health care is a business issue, not a

benefits issue

Slide From Dr Martin Sepulveda

OUR IBM Patient needs A long-term comprehensive relationship with a

Personal Physician empowered with the right tools and linked to their care team.

The Joint Principles: Patient Centered Medical Home

Personal physician - each patient has an ongoing relationship with a personal

physician trained to provide first contact, and continuous and comprehensive care

Physician directed medical practice – the personal physician leads a team of

individuals at the practice level who collectively take responsibility for the ongoing

care of patients

Whole person orientation – the personal physician is responsible for providing for

all the patient’s health care needs or arranging care with other qualified

professionals

Care is coordinated and integrated across all elements of the complex

healthcare community- coordination is enabled by registries, information

technology, and health information exchanges

Quality and safety are hallmarks of the medical home-

Evidence-based medicine and clinical decision-support tools guide decision-making;

Physicians in the practice accept accountability voluntary engagement in

performance measurement and improvement

Enhanced access to care is available - systems such as open scheduling,

expanded hours, and new communication paths between patients, their personal

physician, and practice staff are used

Payment appropriately recognizes the added value provided to patients who

have a patient-centered medical home- providers and employers work together to

achieve payment reform

12

Every country starts at the base of the pyramid with

Wellness Prevention primary care, and they work

their way up until the money runs out.

3° Care

1° Care, Wellness

Prevention

2° Care

3° Care

2° Care

1° Care

… “We start

at the top of

the pyramid,

and we work

our way down

until the

money runs

out…And so

we have to

change the

pyramid. We

have to start at

the base.”

What’s

wrong

with this

picture?

And the PLAN is – CPCi by CMMI

Care management: Primary care practices will be able to proactively assess their patients to determine their needs and provide appropriate and timely preventive care.

Access and continuity: Primary care practices must be accessible to patients on a 24/7 basis and be able to utilize patient data tools to give real-time healthcare information to patients in need.

Planned care for chronic conditions and preventive care: Participating primary care practices will deliver intensive care management for the patients with high needs and create a plan of care that fits a patient’s individual circumstances and values.

Patient and caregiver engagement: Primary care practices will have the ability to actively engage patients and their families to participate in their care.

Coordination of care across the medical neighborhood: WELLBY

36.3% Drop in hospital days

32.2% Drop in ER use

-9.6% Total cost (Mayo Zero cost increase)

10.5% Inpatient specialty care costs are down

18.9% Ancillary costs down

15.0% Outpatient specialty down

Outcomes of Implementing Patient Centered Medical Home Interventions: A Review of the Evidence from Prospective Evaluation Studies in the US, K. Grumbach & P. Grundy, November 16th 2010

Smarter Healthcare

2010 2011

Adults (18-64)

ER visits -6.6% -9.9% Primary care sensitive

ER Visits -7.0% -11.4% Ambulatory care

sensitive

Hospitalizations (per

1,000) -11.1% -22.0%

BCBS MA 6% decrees cost (NEJM)

BCBS MI 2670 physician (BIG study)

HEALTH INDUSTRY -- WSJ WellPoint's New Hire.

What Is Watson?

IBM – WellPoint

Don’t handle your care needs in a BAD MEDICAL NEIGHBORHOOD!!

Unaccountable care, lack of organization, DO NOT GO THERE ALONE !!

Be wise when you pay for care, KNOW WHAT YOU BUY!!

Least Expensive Most Expensive

Ogden, UT $2,623

Dubuque, IA $2,719

McAllen TX $2,950

Anderson, IN $7,231

Punta Gorda, FL $7,168

Racine, WI $6,528

Providence $6,367

Naples, FL $6,312

Ocean City, NJ $6,128

Cost of Commercial lives

“ We don't have a health care delivery system in this country. We

have an expensive plethora of uncoordinated, unlinked, micro

systems, each performing in ways that too often create sub-optimal

performance, both for the overall health care infrastructure and for

individual patients." George Halvorson, from “Healthcare Reform Now

Coordination -- we do NOT know how to play

as a team

“We do kidney transplants and dialysis more often than anyone,

but we need to, because patients are not given the kind of

coordinated primary care that would prevent chronic

complications of renal and heart disease from becoming acute.”

George Halvorson (CEO Kaiser)

from “Healthcare Reform Now”

Population Health

System Integrator

Patient Experience

The System Integrator

Creates a partnership across the medical

neighborhood

Drives PCMH primary care redesign

Offers a utility for

population health and financial management

Per Capita Cost

Productivity

The Quadruple Aim Readiness, Experience of Care, Population Health, Cost

So simple! So much!

If you scan the world for value based healthcare, you will find a common element: a relationship-based team with a project manager! A comprehensivist that can command and control in an accountable system.

Superb Access to Care

Patient Engagement in Care

Clinical Information Systems

Care Coordination

Team Care

Patient Feedback

Publicly Available Information

Defining the Care Centered on Patient

OPM $39 Billion Book with Accountable Care

Patient at the Center

24-7 clinician phone response

Provide open scheduling.

Provide care management and coordination by specially-trained team members.

Use an EHR with decision support.

Use CPOE for all orders, test tracking, and follow-up.

Medication reconciliation for every visit.

Prescription drug decision support.

Implement e-prescribing.

Pre-visit planning and after-visit follow-up for care management.

Offer patient self-management support.

Provide a visit summary to the patient following each visit.

Maintain a summary-of-care record for patient transitions.

Email consultations.

Telephone consultations.

The development of care plans.

Performance outcome

measures.

Payment reform requires more than one method, you have dials, adjust them!!!

fee for health”

“fee for outcome”

“fee for process”

“fee for belonging

“fee for service”

“fee for satisfaction”

11% CMS Shift in payment away from FFS to other dials. CMS Bundling!! CMS Advanced Primary Care

Wellpoint PCMH, BCBS Hawaii no new FFS $$

CMS Plus most other buyers

HIT Infrastructure: EHRs and Connectivity

Primary Care Capacity: Patient Centered Medical Home

Operational Care Coordination: Embedded RN Coordinator and Health Plan Care Coordination $

Value/ Outcome Measurement: Reporting of Quality, Utilization and Patient Satisfaction Measures

Value-Based Purchasing: Reimbursement Tied to Performance on Value (quality, appropriate utilization and patient satisfaction)

Achieve Supportive Base for ACOs and Bundled Payments with Outcome Measurement and Health Plan Involvement

Trajectory to Value Based Purchasing: Achieving Real Care Coordination and Outcome Measurement

Public Health

Prevention

Specialists

PCMH in Action Vermont “Blueprint” model

Community Care Team

Nurse Coordinator Social Workers

Dieticians Community Health Workers

Care Coordinators

Public Health Prevention HEALTH WELLNESS

Hospitals

PCMH

PCMH

Health IT

Framework

Global Information

Framework

Evaluation

Framework

Operations

A Coordinated

Health System

Vermont Financial Impact

$300,000,000

$320,000,000

$340,000,000

$360,000,000

$380,000,000

$400,000,000

$420,000,000

1 2 3 4 5

INC

RE

ME

NTA

L C

OS

T

PE

R Y

EA

R

YEARS

IMPACT OF MEDICAL HOME SAVINGS ACROSS TOTAL POPULATION

Vermont Financial Impact

Avoidable emergency room visits continue downward

trend, seven percent better than market.

Following evidence-based medicine continues to

improve, six percentage points better than market.

Medical cost trend is more than seven percentage

points better than market.

$9 PMPM cost savings.

Diabetes is better controlled, will improve long-term

health and lower medical costs.

And Today in NY PCMH practices

The Pennsylvania State Plan So simple so much

We Developed a better healthcare system starting with Public Private payers Private payers Joined

Strong Primary care is foundational to a high performing healthcare system

Additional resources needed to help primary care manage populations

Learned timely data is essential to success

Learned must build better local healthcare systems (public-private partnership)

Physician leadership is critical

Improve the quality of the care provided and cost will come down

Patient is the center

of the Medical Home

Population Health

Patient-Centered Care

Refocused Medical Training

Patient &

Physician Feedback

Advanced IT Systems

Access to Care

Team-Based

Healthcare Delivery

Decision Support Tools

Model adapted from the

NNMC Medical Home

Enhancing Health and the Patient Experience

Medical Home

Model

Care that is

Accountable

PATIENT CENTERED MEDICAL HOME:

VHA Patient Aligned Care Team

Replaces episodic care based on illness and patient complaints with coordinated care and a

long term healing relationship

Reinventing Medicaid findings are Outstanding Oklahoma's patient-centered medical home initiative has reduced

Medicaid costs $29 per patient per year from 2008 to 2010. Moreover, use of evidence-based primary care, including screening for breast and cervical cancer, increased.

The Colorado initiative expanded access to care. Before the initiative, only 20 percent of pediatricians in the state accepted Medicaid; as of 2010, 96 percent and did and at a lower cost to the state.

Vermont, inpatient care use and related per-person per-month costs decreased 21 percent and 22 percent, respectively, from July 2008 to October 2010. ER use and related per-person per-month costs decreased 31 percent and 36 percent, respectively.

Patient Centered Medical Home in Washington in State Acute care spending there was 18 percent below the national average. Inpatient stays per beneficiary were 35 percent below the national average.

Citation -- M. Takach, "Reinventing Medicaid: State Innovations to Qualify and Pay for Patient-Centered Medical Homes

Show Promising Results," Health Affairs, July 2011 30(7):1325–34.

The Bottom Line in Medicaid

PCMH starting to show an impact in access to care, quality, and cost control.

Patients love to see meaningful information about

themselves and it take IT tools to

If you give patients educational materials with their name on it and with

their data analyzed in it, they will read it, pour over it and discuss it with

you.

If you tear off a generic sheet and give it to them, it often goes in the waste

basket. If you give patients an analysis of their health risk AND if you

include a “what if” scenario, i.e., what will their health risk be if they make a

change; you can prove to them,

“if you the healer make a change, it will make a difference to your patient.”

PCMH is non-political – the right POV

for delivery transformation

“We never abandoned advocating new

Models of care. We’ve long pushed folks

to realize that Delivery reform is the key.”

The patient-centered medical home is

core.

“We included the attached

chapter on PCMH in our book.

and have a new publication on

ACOs coming out in January.”

Physician Practice

Size

(# of patients) Level 1+ Level 2+ Level 3+

< 10,000 $4.68 $5.34 $6.01

10,000 - 20,000 $3.90 $4.45 $5.01

> 20,000 $3.51 $4.01 $4.51

PMPM Payment: Commercial Population

Level of PCMH Recognition

41

Tier Major Condition Groups Minutes of Work PMPM PMPM Payment

0 None N/A N/A

1 3-Jan 15 $10.14

2 6-Apr 30 $20.27

3 9-Jul 60 $40.54

4 10+ 90 $60.81

42

Payment Model Component PMPM Payment

Care management payments Up to $2.50 PMPM

Pay-for-performance payments Up to $2.50 PMPM

Payment Model Component PMPM Payment

Practice transformation cost payments (year 1

only)

$1.67 PMPM

Performance bonus (beginning in year 2) Up to $2.38 PMPM (value based on performance)

Risk-adjustment Up to $1.67 PMPM (only for practices with above average

patient panel risk profiles; amount varies by practice)

Payment Model Component PMPM Payment

Practice support payments $1.50 PMPM

$0.60 PMPM (ages 0-17)

$1.50 PMPM (ages 18-64)

$5.00 PMPM (ages 65-74)

$7.00 PMPM (ages 75+)

Shared savings Value based on performance

Care management payments