Value Based Care: Trends for 2018 - BDC Advisors€¦ · Transitions of care management Reduce...

Copyright © 2018 BDC Advisors, LLC. All rights reserved.

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Need head shot

David Fairchild, MD

Director

BDC Advisors

Dave Terry

CEO & Co-Founder

Archway Health


Agenda

Value: why has it been hard to achieve?

Value based Care Trends for 2018

Incremental shifting from FFS to value-based reimbursement: stimulus

for physician engagement

Greater access to convenient, low cost care

Patient centered care—moving beyond lip service

Population health strategies that work

Bundled Payment Overview & Benefits

Sample BPCI Advanced Analytics

Q & A

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Key Themes

Real change takes time

Population health strategies work, and are population specific

Your key issues today are not necessarily ‘population health’

Think:

- Physician engagement

- Perverse incentives of FFS

Understand your local market and balance short term initiatives with

longer term plays

3


2018 goal: actually deliver value

1. Scale

2. Smart growth and new revenue streams

3. Manage cost and margins

4. Become a brand

5. Operate as a system, not just call yourself one

6. Act small – be nimble

7. Engage physicians

8. Leverage Analytics

9. Protect yourself – cybersecurity

10. Manage social determinants of health

11. Work to end the opioid crisis

12. Deliver value

4

Top 12 takeaways from the 2018 JP Morgan Healthcare Conference — while the

destination is uncertain, the direction is clear

Written by Dan Michelson, CEO, Strata Decision Technology | January 10, 2018


What is value?

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“If I had an hour to solve a problem I’d spend

55 minutes thinking about the problem and

five minutes thinking about solutions.”


The medical system had done what it so often

does: performed tests, unnecessarily, to reveal

problems that aren’t quite problems to then be

fixed, unnecessarily, at great expense and no

little risk. Meanwhile, we avoid taking

adequate care of the biggest problems that

people face—problems like diabetes, high

blood pressure, or any number of less

technologically intensive conditions. An entire

health-care system has been devoted to this

game.

America’s epidemic Of Unnecessary Care

Atul Gawande, MD MPH


Revenue Is Still Fee For Service


Modifications To FFS Are Challenging to Implement

MIPS cannot succeed

▪ Replicates flaws of prior value-based purchasing

programs

▪ Burdensome and complex

▪ Much of the reported information is not meaningful

▪ Scores not comparable across clinicians

▪ MIPS payment adjustments will be minimal in first

two years, large and arbitrary in later years

▪ MIPS will not succeed in helping beneficiaries choose

clinicians, helping clinicians change practice patterns

to improve value, or helping the Medicare program to

reward clinicians based on value

5


Real change takes time:

A century of progress against smoking

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Trend: reimbursement will

continue its (incremental)

evolution from volume to value


A well-designed contract establishes a sweet spot where a provider can create value through

lower costs and capture an appropriate portion of the value created, through shared savings

and market share gains.

Managing a complex patient population requires finding the

“sweet spot” in value-based contracts.

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Source: BDC Advisors

http://www.bdcadvisors.com/wp-content/uploads/2015/09/Value-Based-Contracts.pdf


Comprehensive Primary Care Plus (CPC+):

creates incentive for practice innovation

CMS pays primary care practices a monthly care management fee in

addition to (reduced) fee-for-service (FFS) payments

Up-front payments

Comprehensive primary care payments

Incentive payments – kept or repaid based on performance

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Care Management

Fee (PBPM)

Performance Based

Incentive Payment

(PBPM)

Payment Structure

Redesign

Objective Risk-adjusted support

for augmented

staffing and training

for comprehensive

primary care

Reward practice

performance on

utilization and quality

of care

Reduce dependence on

visit-based FFS to offer

flexibility in care setting

Track 1 $15 average $2.50 opportunity N/A (std FFS)

Track 2 $28 average $4.00 opportunity Reduced FFS with

prospective

“comprehensive primary

care” payment


More providers will be in APMs in 2018

2018 will see more Providers in APMs than in 2017

CMS goal: 50% of Medicare fee-for-service payments through alternative

payment models by 2018

More ACOs anticipated in 2018

To avoid MIPS and qualify as an APM – if ready

Challenges have caused ~100 ACOs to drop out

There is no pop health switch

Insufficient infrastructure

Engaging providers

- Especially specialists

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Bundles on the rebound

Mandatory cardiac and surgical hip and femur fx episode payment models

(EPMs) were cancelled in late 2017

2 years into the Comprehensive Care for Joint Replacement (CCJR)

Half the 67 sites changed from mandatory to voluntary

A voluntary Bundled Payment for Care Improvement (BPCI) Advanced

initiative came out Jan 2018

Opportunity for specialist engagement

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Trend: consumerism will reward

greater access to convenient, low

cost, care

15


Envision a national network of PCPs

CVS strengthening its own provider capabilities

9700 pharm locations

1100 Minute Clinics

- Primary care?

- Coordinate chronic care?

Aetna

3rd largest insurer, 22 million members

Will likely create incentives for pts to use Minute Clinic

- No co-pays or prior authorizations, e.g.

Aligned incentives around med adherence

Friend or foe?

16


Put medical care on the shopping list

in 2009 Vanderbilt moved more than 20 clinics to the 100 Oaks Shopping Center…it now

does 25% of its total business there


Transportation and Convenience

• Uber and Lyft revolutionized

transportation

• Now, they want to

revolutionize non-urgent care

transportation

• Many no-shows are due to

lack of transportation

Source: Geisinger Zoc Doc/Uber Announcements

Case Study - Geisinger

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Population health strategies that

work


Measurement and Monitoring

Quality Cost

Stage and Target InterventionsCase

Management

Care

ManagementSocial Workers

Medication

Reconciliation

Transitions In

Care

Referral

Management

Remote

Monitoring

Create Functional Segments

Preventive Screenings At Risk Gaps in Chronic Dz Care High Cost

Perform Meaningful Analytics

HRA PAM Claims Data Clinical Data Lab Results Pharmacy

Identify Population and Create RegistryRisk Contract (Medicare Advantage, Commercial, Medicaid,

Employer)Fee For Service with Attribution (Medicare, Commercial)

Developing Population Health Strategy


Key Competencies To Operationalize Population Health

Management

• Accurately assess population health market opportunity

• Develop physician leadership

• Contracting expertise including alignment of incentives across contracts

• Functional IT system including analytics and workflow

• Effective patient segmentation and interventions

• System of care designed around the patient

• Engaging and activating patients

• Identify and foster a performance network

• Strategic selection of partners including community organizations

• Incentives aligned with transparent clinical and financial performance

metrics


Activity Expected ImpactTime to

Impact

Effects

Within

Months

Transitions of care management Reduce readmissions 3 mos

Case management for high-risk patients with

targeted conditions: diabetes, heart failure,

COPD

Reduce primary admissions and ED 3–6 mos

Case management for other high-risk patients Reduce primary admissions and ED 6–12 mos

Pharmacy management Increase generic use 6–12 mos

Effects

within

1 – 2 yr.

Nursing home managementReduce readmissions/primary

admissions12–18 mos

More efficient specialists and ancillary

providersDecrease cost per episode of care 12–18 mos

High-end imaging Reduce unnecessary testing 12–18 mos

Effects

within

3–5+ yr.

Interventions for low-risk chronic disease

patients: disease registries, chronic disease

care optimization

Improved control; avoid complications 2–5 yr.

Preventive care; screening; lifestyle change;

wellness

Earlier identification and treatment;

decrease incidence of chronic diseases2–5+ yr.

Interventions Work…But Take Time

Source: Geisenger


Challenges Abound To Implement Population Health

Source: AMGA survey of physician groups


Medicare ACO Financial Results Correlated with Benchmark

Not Specific ProgramsShared savings more likely for MSSP

ACOs with higher historical service use

10 Results preliminary and subject to change.

Note. Excludes 38 ACOs serving beneficiaries in multiple states that do not share a border (e.g., an ACO serving beneficiaries in both

New York and California).

Source: CMS data.

0%

10%

20%

30%

40%

50%

60%

70%

Q1 ($7,911) Q2 ($8,933) Q3 ($9,733) Q4 ($10,511) Q5 ($13,160)

% o

f A

CO

s r

eceiv

ing

sha

red

savin

gs

Quintile (average price-adjusted benchmark)


What is right compensation model for value-based world?

Suitability of different provider compensation methodologies by reimbursement environment:

Volume vs Value

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Volume

(FFS)

Value

Salary

RVU

Capitation

% collections

Quality P4P

Visits

Case-mix adjusted panel size


Summary

Majority of provider revenue is still in FFS, even in 2018

Real change takes time

Population health strategies work, and are population specific

Your key issues today are not necessarily ‘population health’

Think:

- Physician engagement

Understand your local market and balance short term initiatives with

longer term plays

Strengthen population health capabilities now to prepare for

continued expansion of value-based reimbursement

27


BUNDLED PAYMENT

OVERVIEW

01

28

Copyright © 2018 BDC Advisors, LLC. All rights reserved.29

What is a Bundled Payment?

In a bundled payment model, a single provider is responsible for managing all

aspects of care during a discrete episode.

Provider as “Conductor” Bundle Definition

• “Trigger event” starts episode (specific

DRG or procedure)

• Defined end date - 90-day episode

length

• Providers are given a bundle-specific

Target Price

• All clinically relevant costs are included

in the Target Price

• Providers share in savings below Target

Price

• Retrospective payment model


State avg post acute care cost for LEJR w/o CC/MCC

ranges from $4,800 to $12,700


Example: Variation in CHF w/MCC spending by NJ

Hospital

MS-DRG 291Avg post acute care spend for CHF w/MCC among NJ hospitals

ranges from $15,600 to $27,500


BPCI Performance

$0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000

BPCI Performance Period

Baseline Period

Anchor Readmission SNF HHA Part B OP Other

$0 $5,000 $10,000 $15,000 $20,000 $25,000


Baseline Period


$0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000


Baseline Period


Archway Bundled Payment PerformanceQ2 2015 – Q1 2016

Major Joint Replacement

COPD

CHF

16%

14%

16%


BPCI Results: Sample Provider Revenue Growth

Sample

ProviderA B C

Annual Volume 1,498 1,783 4,575

Savings per Case $2,076 $2,050 $2,647

New Provider Annual

Revenue$3,109,786 $3,654,487 $12,108,789


Benefits of Bundled Payments

Potential to significantly increase revenue and profitability

Increased provider autonomy over the care process

Years of data from the full continuum

Opportunity for to specialty providers to participate in an Advanced

Alternative Payment Models (APMs)

Non-binding CMS application process


BPCI Advanced Model – Key takeaways

• Voluntary program; Medicare FFS beneficiaries only

• Episode Initiators (EIs) can be acute hospitals or Physician Group Practices

• 90 day bundles; all clinically relevant Part A & B costs included

• Bi-annual retrospective reconciliation; 20% stop loss at EI level

• Qualifies as an Advanced Alternative Payment Model (APM) Under MACRA

• Quality performance will adjust incentive payments

• More sophisticated target pricing methodology

• CJR, Next Gen ACO, MSSP Track 3 take precedence over BPCI Advanced

• While still non-binding, application for BPCI Advanced is more robust than

recent open window periods

• 29 inpatient bundles and 3 outpatient bundles


SAMPLE BPCI ADVANCED

DATA ANALYTICS

02

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Bundle AnalyticsHospital Opportunity Snapshot-All Bundles


Bundle AnalyticsHospital Volume & Cost Summary-All Bundles


Bundle AnalyticsHospital Opportunity Summary-All Bundles


Bundle AnalyticsPerformance Benchmarking - CHF


Bundle AnalyticsPhysician Benchmarking - CHF

Hospital

Blinded


Post-Acute Deep DiveSkilled Nursing Facilities-CHF


BPCI Advanced Application Timeline

Submit non-binding

application to CMS in

order to:

1. Secure option to

participate

2. Receive cost and

quality data

3. Receive Target

Prices

May - June August June – July

May: Receive data

and target prices

from CMS

May – June:

Review data for

strategic

opportunity

June: CMS offers

participant

agreements to

applicants

Participants

select bundles

Participants

select Convener

Signed

participant

agreement due

to CMS

Through March

12th, 2018 Oct 1

Performance

period begins

Copyright © 2018 BDC Advisors, LLC. All rights reserved. 44

David Fairchild, MDDirector

BDC Advisors

[email protected]

617.413.5881

Dave TerryCEO

Archway Health

[email protected]

617/209-7985

Questions

Contact Info

mailto:[email protected]


Value Based Care

Trends for 2018

March 5, 2018

Value Based Care: Trends for 2018 - BDC Advisors€¦ · Transitions of care management Reduce...

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