Understanding the Evolving Rural MarketplaceCost, Quality, Access, and Population Health

Andrew Busz, FAHM, Policy Director, FinanceIan Corbridge, RN, MPH, Policy Director, Clinical Issues

June 24, 2014

How is Rural Different?

Geography Population/Demographics Payor Mix Volume of services- Impact on cost per unit due

to higher proportion of overhead costs Capitation and risk sharing difficult due to low

enrollment numbers.

The Jigsaw Puzzle of Provider Types in Rural Areas.

• Combines different approaches to ensure access to care in rural areas.

• The mix of provider types and degree of collaboration is unique to each community.

Critical Access Hospitals

Restricted in some ways, granted greater flexibility in others compared to larger hospitals

Cost-based payment for Medicare and Medicaid

Federally Qualified Health Centers

Specific board structure, including consumers Serves underserved clientele in urban and rural

areas Provides wrap-around services Required to take all comers on a sliding-scale

basis Paid an encounter rate by Medicare and

Medicaid FFS, rather than fee schedule

Rural Health Clinics

Required to employ or contract with mid-level providers (PA or ARNP)

Paid an Encounter Rate by Medicare and Medicaid FFS, rather than fee schedule

Encounter rate for hospital-based RHCs reflects hospital cost component

Free Clinics

Primary clientele is uninsured population Primary financial support through donations or

hospital sponsorship Clinical care provided by area providers on a

volunteer basis Many now closing due to ACA coverage

expansions

Independent Physicians and Clinics

Paid regular fee schedule by Medicare, Medicaid, and Commercial Insurance

Increasingly rare in rural areas due to payor mix

Public Health and Social Service Agencies

Publically funded Focus on population health and preventative

services

Provides services generally not covered by insurance

Regional Support Networks and Community Mental Health

Funded directly by the state

Regionally organized

Generally coordinated with, rather than integrated with medical services

Population Health and Quality in Rural Areas – the Current Environment

A Health Snapshot

County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

What Influences Health

County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

Funding Population Health

• Poor incentives

• Eroding funding for public health

• Grants, are they a solution or a double edged sword

Personal Health Care84%

Public Health

3%

Other14%

National Health Expenditures 2010

CDC, accessed on 6/1/14 http://www.cdc.gov/nchs/data/hus/hus13.pdf#112

Community Health Needs Assessment – A Brief Look

Priority 1

Priority 2

0 5 10 15 20 25 30

Health Promotion Behavioral HealthObesity Tobacco UseChronic Disease Social Determinants of Health/Health DisparitiesAccess to Care

Population Health Quality

• USPSTF prevention screening recommendations are free under the ACA… however

• Poor prevention screening across the state

• Rural residents are less likely to receive preventive services

The Commonwealth Fund and NORC, accessed on 6/1/14 http://www.commonwealthfund.org and http://NORC.org

Population Health Quality (cont’d)Mammography Screening

County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

Rural Quality Measurement• Largely sheltered from national level measurement

• Us-side vs. Down-side

• Challenge of the “small N”

• Few rural specific measures• NQF website – 7 measures tagged with a “rural”

designation• Total NQF measures = 637

• Are rural specific measures needed?

The Managed Care Environment

Managed Care Plans Defined population and benefits

Historically focused on per unit costs

Short term return horizon

Risk avoidance

Historically not responsible for global issues such as uninsured costs, teaching costs, or overall population health

Current Managed Care Workarounds for Rural Providers

Medicare Advantage: based on FFS cost-based or encounter rates

Medicaid: enhancement/reconciliation to shield plans from higher per unit costs

Commercial: percent of charge rather than prospective arrangements

Threats to Critical Access Hospitals

Cost-based payment/ geographic restrictions

Provider supervision changes

Length of stay restrictions/ 96 hour rule

Inadequate network adequacy standards

Threats to FQHCs and RHCs“The FQHC/RHC’s unique payment methodology does not always promote efficiency and value and increasingly impedes some state’s evolving delivery system and payment transformations.”

2/24/2014 letter from National Association of Medicaid Directors to HHS

Making the Transition

Accountable Care Organizations

Requires large population/geography

Requires sophisticated data, contracting, and EHR capabilities

Ability to provide full range of services

Barriers:

Lack of data to manage care

Restrictions on clinical integration

State Health Care Innovation Project (SHCIP) and Transformation

All-payor Database –Claims data Availability and sharing of EHR data Role of Accountable Communities of Health

(ACH) Proper allocation of funding that targets root

determinants of health while maintain viability of medical infrastructure and access to care

ACO

What Direction Will Things Take?

Plan

Provider

Payor

ACH

Population Health and Quality in the Emerging World

Supporting Population Health

• Health care will have greater accountability for the health of a community

• Do we have the right:• Partners,• Resources, and • Payment structure… To deliver population health?

Improving Population Health – Federal Efforts

• ACA• Public Health Fund

• Free prevention screening (SUPSTF A & B)

• CMS Innovation Center – State Innovation Models (SIM) program grants

• Greater focus on population health measures

Improving Population Health (cont’d) –State and Local Efforts

• State Innovation Bill (2572)• Communities of health• Extension program• All payer claims database• Common performance measures

• Behavioral Health Integration Bill (6312)

• State SIM grant application – core focus areas: tobacco use, obesity and diabetes…

Opportunities to Enhance Rural Population Health Improvement Efforts

• Local collaboratives with broad representation

• Increased focus on screening and prevention

• Measurement• Rural specific measures• Focus on ambulatory care and screening measures

• Use of HIT and new data systems to track and improve quality

WSHA – Leading Population Health for our Members

• WSHA will:

• Explore state wide population health goal• Help support partnerships and collaboration• Toolkit to support community engagement

• Support the dissemination and spread of new ideas/best practices across stakeholders

• Work toward aligning incentives to support population health

Questions and Comments

Andrew Busz andrewb@wsha.orgIan Corbridge ianc@wsha.org