Building the IT Infrastructure for Accountable Care
www.pwc.com
April 11, 2014
PwC
Learning Objectives
At the end of this presentation, the participants will:
• Understand the Accountable Care Organization (ACO) construct, within the context of health care market forces
• Appreciate the key business factors and decisions which shape the operations of an ACO
• Recognize the core technology capabilities required for successful ACO management
2
PwC
A bit about us
3
Stacey Empson
Principal
Experienced healthcare executive with more than 20 years of leadership and business consulting experience in health information technology, law, and transformation. Stacey helps health systems, hospitals, physicians, payers, and integrated networks identify and execute strategic business solutions.
Previous Roles:
• Managing Director of healthcare services for a global IT services company
• CEO of an entrepreneurial healthcare management consulting firm
• Healthcare Partner at a Fortune 100 company
Sarah Kramer
PwC Director
Experienced healthcare executive with nearly two decades successfully leading substantial technology and business transformation programs at several large integrated academic and community health care systems in the US, Canada, Asia and Africa.
Previous Roles:
• CIO for several large health systems
• Interim CIO for the Aga Kahn University and Health System in Pakistan and East Africa
• Led large Epic installation at a nationally recognized academic health system in southern California
Stacey Empson
PwC Partner
PwC
Agenda
1. ACOs within the new health economy
2. Business drivers/considerations for successful ACO operations
3. Technology as the backbone, enabler and differentiator
4. Summary/Key Takeaways
4
PwC
1. ACOs within the new health economy
5
PwC
The old model: Funds flow
Healthcare was primarily financed by employers and government, who funneled most of the money through health insurance plans.
Consumers paid relatively little out of pocket and were generally unaware of the cost of services they received
Employers
Government
Health insurers
Physicians Hospitals
Pharma
Life Sciences
Medical devices
More services = More money
Consumers
6
PwC
A new health economy: Altered funds flow
Consumers
Employers
Government
Health insurers
Physicians Hospitals
Pharma
Life Sciences
Med. devices
Cu
sto
me
rs
Risk-bearing entities, e.g. ACOs
Alternative health,
wellness, prevention
Employers and government are contracting more directly with care providers. New regulations put providers at financial risk for the quality of care they deliver.
Consumers will pay for a larger portion of the care through deductibles and copays, and will be more aware of the costs. They will want better value for their healthcare dollars, a greater decision-making role, and a wider variety of treatment alternatives.
7
PwC
Other industries have undergone similar changes to those anticipated in Health
8
Travel
Banking
Retail
–
1980s (Industry Centric)
Present (Consumer Centric)
Bank Teller
• Banker’s hours
• Branch only
ATMs, Mobile Banking
• Available 24/7
• Location agnostic
Travel Agency
• Limited Hours
• Limited Locations
• Annual Updates
Standardized Marketing and Inventory
• National campaigns
• Sunday Circulars
Online Booking
• On-demand booking
• Location agnostic
• Real time pricing
Customized
• Website, location specific
• Data-driven targeted promotions
PwC
Just like other industries have evolved to be more consumer centric, the future of healthcare is headed toward personalized care
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Present Physician office, Hospitals,
Pharmacy
Future Personalization
• Set hours & locations
• Standardized treatment plans
• Queue for care
• Individualized services, treatments, and drug protocols
1980s Physician office, Hospitals,
Pharmacy
• Set hours & locations
• Standardized treatment plans
• Queue for care
PwC
This new health economy will require some different areas of focus for traditional health providers…
• Exploit new technologies e.g., predictive, biometic,
genomic
• Convert volumes of data into meaningful insights & useful
information
• Shift from volume to value/quality incentives
• More efficiency, lower costs
• Commercialize core competencies
• Improve outcomes through research and scientific
discovery
• Pursue new relationships and partnerships
• Build a full continuum of care including prevention, virtual and wellness
• Understand, attract and retain new markets
Consumer Innovation
Smart Analytics
Operational Agility
10
PwC
Illinois area ACO dynamics
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PwC
2. Business drivers and considerations for successful ACO operations
PwC
What is an Accountable Care Organization (ACO)?
13
An ACO is a network of providers and/or organizations that are accountable for the health of a discrete group of Medicare beneficiaries
Local network of primary care physicians
Hospitals
Specialists
Potentially other providers that accept
joint responsibility for the quality and cost
of care for a defined population of patients
PwC
ACOs pursuing IHI’s "Triple Aim" www.ihi.org/offerings/Initiatives/TripleAim
The Institute for Healthcare Improvement (IHI) believes that new designs can and must be developed to simultaneously accomplish three critical objectives, or what IHI calls the “Triple Aim”.
The "Triple Aim" is simultaneous pursuit of:
1. Enhancing the patient experience of care (including quality, access, and reliability);
2. Improving the health of the population; and
3. Reducing, or at least control, the per capita cost of care.
PwC finds that the objectives of the "Triple Aim" are pursuits successful ACO's should incorporate into their strategy, culture and operations.
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IHI’s “Triple Aim”
Per Capita Cost
PwC
ACO Core Competencies
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Critical Success Factors
Leadership
Governance
Integrated Clinical,
Financial and Operational Management
Infr
ast
ruct
ure
an
d I
T
Team, culture, innovation
Strategy design and execution
Incorporate clinical measures, manage compliance, align evidence-based clinical practices and financial incentives
Competency
Risk Management
Manage population financial risk
Workforce
Optimize productivity
PwC
PwC’s “ACO Maturity Continuum” – the goal is to start from where you are, and move through to level 4. Gains can be made along the continuum
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Proposed ACO meets basic requirements to perform as an ACO and can effectively coordinate patient care.
Proposed ACO has demonstrated improved outcomes for chronic conditions and has characteristics needed to exceed basic ACO performance.
Proposed ACO has demonstrated reductions in costs and has piloted service lines and / or populations for capitated-based payments.
ACO has implemented population health and wellness programs and has the ability to predictively model population health / healthcare costs and accept capitated-based payments for patient populations.
Level 1 – Care Coordination / Transitions of Care
Level 2 – Demonstrated Quality Improvement / Excellence (Chronic
Disease Management)
Level 3 – Demonstrated Cost Improvement & Ability to Take Risk
Level 4 – Population Management (Predictive Modeling & Population
Health)
Level Capability
PwC
3. Technology as the backbone, enabler and differentiator
PwC
The evolving mission of technology
Across today’s increasingly competitive healthcare landscape, the bar has been raised for today’s technology leaders. This is even more important for entities seeking to offer both provider and payer capabilities in a crowded and competitive market.
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Support
Technology continues to play a critical role in supporting and enabling an organization’s business strategy.
Advance
Technology resources and investments are also expected to advance the organization– developing flexible capabilities to increase effectiveness, enabling the group to grow.
Differentiate
There is an increasing expectation that technology leaders will drive innovation – adopting new technologies to differentiate the organization.
Differentiate
Advance
Efficiency
Support
Inn
ov
ati
on
PwC
Assessment Methodology – IHI’s "Triple Aim" www.ihi.org/offerings/Initiatives/TripleAim
Technology:
• Integration
• Analytics
• Collaborative patient/customer engagement tools
IHI’s “Triple Aim”
Per Capita Cost
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PwC
Enterprise EHR: Ticket to entry
Certified, integrated, enterprise-wide EHR (MU Stage 2)
• “ERP” of the clinical enterprise
• Patient-centricity is the core of all information requirements
Now is the time to explore full optimization of functionality that often lies dormant:
• Reporting
• Access
• Transitions of Care
• MPI, Facility, Provider, User data accuracy and linkage
• Decision support
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PwC
Integration: shared EHR and/or HIE
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• Text goes
here
Accountable
Care
Organization
ACO professionals in group practice arrangements
Other Medicare providers and suppliers as determined by the Secretary (e.g. PBM)
Hospitals and their ACO employed professionals
Networks of individual practices of ACO professionals - e.g., an IPA
Partnerships or JVs between hospitals and ACO professionals
Fully implemented EHR across the care continuum is a base requirement
Connectivity can be achieved through HIE, and/or expanding single instance of EHR across continuum
PwC
Breakdowns in care delivery often occur at the transition between care settings
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Successful delivery of an ACO model requires coordination of care across the healthcare continuum
PwC
Data Analytics: Better understanding of current patients, providers, outcome, cost to predict and manage proactively
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PwC
Patient Engagement: We are seeing a renewed focus on patient engagement and population health in both payers and providers
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Source: PwC Research
Non-linear, but time based member health
journey
Healthy
Newly Diagnosed Caregiver
Sick
Engagement needs change with the patient’s health journey
• Technology will need to adapt and support the continuum
PwC
Patient Experience: Delivering a world class patient experience leads to knock-on effects that percolate across your health system….
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Knock-on Effects Observations Impact on your Business
Reduction in Readmission Rates
• Better patient experience associated with lower 30-day risk-standardized hospital readmission rates1
• Limit the financial burden of readmissions as CMS initiates and commercial payers pick up on value based purchasing
Amplifying Effects on Customer Loyalty
• 72% of consumers indicate that provider reputation and personal experience are the top drivers of provider choice2
• 9 out of 10 consumers are willing to recommend a provider after a good experience2
• Attract and retain your target patient and payer mix by employing targeted marketing and word of mouth based on your patient experience
Ready for the “Rising Tide”
• Hospitals measured by the CMS VBP program have shown improvements in nearly all patient experience and process off care dimensions year over year3
• The budget neutral VBP has increased competition amongst hospitals; get on board or be left behind
Source: (1) “Relationship Between Patient Satisfaction With Inpatient Care and Hospital Readmission Within 30 Days”, William Boulding et. Al., American Journal of Managed Care, January 2011, (2) PwC Experience Radar 2012, (3) CMS data
PwC
Building on technology investments enable movement up the PwC “ACO Maturity Continuum”
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Tools to connect HIE; e-Referral
Tools to improve: Decision support, alerts, disease registries, patient portals
Tools to engage; tools to understand: Patient/customer engagement; service line oriented population management
Tools to predict: Sophisticated data analytic capacity; predictive modelling; actuarial analysis; ability to accept capitation based payments
Level 1 – Care Coordination / Transitions of Care
Level 2 – Demonstrated Quality Improvement / Excellence (Chronic
Disease Management)
Level 3 – Demonstrated Cost Improvement & Ability to Take Risk
Level 4 – Population Management (Predictive Modeling & Population
Health)
Level Tech Capability
PwC
Overarching Technology: Example Technology Assessment: ORGANIZATION’s technological readiness for population health is distant even though the organization has achieved MU accreditation
3.0
2.8 2.8 2.8
2.5
2.3
2.0 2.0 2.0
1.9
1.8
1.4 1.4
1.0 1.0 1.0 1.0
0.4
0.00.0
0.5
1.0
1.5
2.0
2.5
3.0
MU Stage 2 Clinical
Quality
Measures
MU Stage 1 Eligible
Professional
Core
Objectives
MU Stage 2 Eligible
Professional
Menu
Objectives
EHR/ EMR --Non-Clinical
Data Capture
EHR/ EMR --Electronic
Prescribing
Data Warehousing
EHR/ EMR --Clinical Data
Capture
EHR/ EMR --Clinical Data
Share
Physician Portal
Security (HIPAA)
Related to
ACO Security
Exchange
EHR/ EMR --Care
Coordination
&
Management
Patient Portal Basic Reporting
EHR/ EMR --Clinical
Intelligence
Telehealth / E-Mobility
Health Information
Exchange
(HIE)
Administrative Function (at
the ACO
Level)
Business Intelligence
Health Insurance
Exchange
(HIX)
Technology Rating by Criteria
• ORGANIZATION’s primary needs are access to “timely, actionable information” and analytics capabilities for population health management
– Access to external data (clinical, utilization, cost, quality) is very limited
– Population-level data is required to identify and target high-risk disease states and patients
• Internally, additional work is required to streamline the use of health information technology and to align technology with clinicians’ workflows
– “The EHR makes everything we do more time consuming. The system does not sufficiently flag if there are any gaps. All of the information gets buried.”
Physician
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PwC
4. Summary/Key Takeaways
PwC
ACO Lessons Learned
• Technology/change/spend fatigue post MU achievement
• Optimize current technology assets vs. introduce new technologies
• IT operations needs to mature, including thoughtful and aligned enterprise
governance
• Build AND buy strategies required to quickly advance analytic capability
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PwC
In Conclusion
Technology is a key enabler to ensure successful transition to a mature ACO
• EHR is the price of entry
• Integration across the continuum
• Sophisticated and predictive data analytics to manage outcomes and cost, and reduce risk
• Patient/customer engagement is the new reality
• No matter where you start on PwC’s “ACO Maturity Continuum,” achieving true population management is the goal
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Questions?
Contact Information
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Stacey Empson [email protected] 312-933-6961
Sarah Kramer [email protected] 310-200-9619
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