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UCSF Clinical Enterprise Strategic Plan

UCSF Clinical Enterprise Strategic Plan . Retreat 1 May 6, 2013. Retreat Agenda. UCSFCE Strategic Planning Process – Project Overview. February - April. August - October. May - July. 4. Clinical Enterprise Group & Steering Committee Meetings .

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UCSF Clinical Enterprise Strategic Plan

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  1. UCSF Clinical Enterprise Strategic Plan Retreat 1 May 6, 2013

  2. Retreat Agenda

  3. UCSFCE Strategic Planning Process – Project Overview February - April August - October May - July 4. Clinical Enterprise Group & Steering Committee Meetings

  4. Leadership of the CE Strategic Planning Process • Teams of 15 – 20 faculty and clinical enterprise leaders that will recommend strategies, tactics and requirements to the CESP Steering Committee • Teams will meet 5 times, between May – late July

  5. Retreat Agenda

  6. A Health Plan View of the California Market UCSF Clinical Enterprise Strategic Planning Retreat May 6, 2013 1

  7. My Perspectives • 8 Years of Consulting, Physician Practice Management • 14 Years at Blue Shield of California • Strategic Planning • Network Contracting • Employer Sales and Account Management • Hill Physicians • 3 Weeks as Chief Operating Officer 2

  8. What’s Important Three most important priorities for health plans (and should be for the rest of the healthcare delivery system)… • Affordability • Affordability • Affordability We’ve been discussing this for years, but now it is much, much more serious… 3

  9. Drivers of Change • Social/Political Tipping Point • Health reform put healthcare front and center • Visibility/transparency of prices in the exchange • Sticker shock driven by health reform impacts • Premium rate setting legislation is being proposed • Employers are Struggling • Health insurance costs are equal or greater than the profit margins of many companies • Health insurance costs = fully loaded salary of a software programmer in India • Companies that compete in global industries can’t afford it 4

  10. Drivers of Change (cont’d.) • The value proposition is not compelling • Prices of health insurance rise ~10% per year the last 15 years… • About the same networks • About the same outcomes (that the system can show) • Similar member experience • One organization is providing a differentiated product: Kaiser • More affordable • More integrated • More standardized • Attracting superior (healthier) risk 5

  11. Erosion of Employer Based Coverage Average Premiums 2002 vs. 2012 +169.7% Inflation 2002 vs. 2012 +32% Political View: Health insurance inflation is the health plan’s fault Reality: Health insurance inflation is due to health care cost inflation 6

  12. Why will there be Sticker Shock? • Individual policies in the exchange will be expensive due to… • Risk selection (a big unknown) • 3:1 Age Rating • Benefit levels (“essential” benefits) • Employer premium may also rise due to… • Age rating limitations • Essential benefits • Few people today understand what health insurance costs – the exchange will make it much more visible and politicians will react 7

  13. The Challenge • How can our system achieve dramatically lower cost/trend and demonstrate quality and outcomes, while maintaining the vitality and innovation of individual provider organizations working together? • If we do not solve it, the government may try to solve it for us. 8

  14. Implications • Plans/Hospitals/Physician Organizations must find ways to work together in an integrated manner… • Aligning incentives • Integrating data and using data to improve care • Building systems of care • Breaking down silos • Avoiding waste • Moving from reactive to proactive • Focusing on total cost of care for populations 9

  15. Reasons for Optimism • Sacramento ACO for CalPERS • Blue Shield, Dignity Health, Hill Physicians • 0% trend year 1, dramatically lower trends years 2 and 3 • Aligned incentives, focused attention • Leadership engaged at the highest level • Focusing on outcomes of system as a whole • Membership migration to the ACO • Before the ACO • 8-10% trends every year • Loss of members to Kaiser. 10

  16. Reasons for Optimism (cont’d.) • ACO in San Francisco with Health Net, UCSF, Dignity Health and Hill Physicians • Started 1/1/13 • Promising engagement • Sharing data • Aligned incentives • Focusing on improving care while managing costs • UCSF has been a great partner ! • Too early for results, but encouraging signs 11

  17. Implications for Plans and Providers • Work closely together with aligned incentives – make decisions that drive a better overall outcome not maximize the result for one party/department/facility/group • Share and use data to move from fee-for-service fragmented care to population health management • Use new technologies and approaches to improve care, such as team-based care, use of secure messaging, in-home technologies • Change organizational structure and decision making to break down barriers and silos • Work with plans to design benefits with meaningful incentives for members to improve health status 12

  18. Thoughts on UCSF • Incredible reputation and brand for high quality (and expensive) healthcare • A magnet for higher risk patients (e.g. in The Exchange), and very important to purchasers who are less price sensitive (e.g. high-tech companies) • Need to find a way to partner with others to combine broad-based and cost effective care in the community with high quality tertiary and quaternary care delivered by UCSF • Requires a difficult shift away from “heads in beds” and expensive clinical programs to finding ways to keep people healthy (and get paid for it) • Need to move away from cost shifting: compensating for inadequate Medicare and MediCal reimbursements by increasing margins on commercial insurance is killing the golden goose

  19. Questions?

  20. Retreat Agenda

  21. Academic Medicine for the Future May 6, 2013 UCSF Clinical Enterprise Retreat Tom Enders, Managing Director Manatt Health Solutions

  22. Despite dire predictions, the last two decades have been excellent for academic medicine Innovation in Medicine — Aging of the Population — Specialty Services Boom NIH Doubling Health Reform Excellent Clinical Margins Growth of the AMC Missions PhilanthropyBoom Stock Market Bubble 2003 – 2008 NIH Stimulus Managed Care and Capitation 1990 1995 2000 2005 2010 2015

  23. Erosion! AMC Defenses Relentless Forces

  24. The AMC Business Model…. AMC Sustainability 2 x Pricing Power x (Enterprise Costs) Talent ∫(Δ)(Technology Introduction - Diffusion) (Regulation)

  25. The Challenge of Change • Risk of change perceived as great • Connection to people who succeeded in the old model • Fear of lacking the competence to succeed • Overload • Healthy skepticism about new ideas • The fear of hidden agendas • Feeling of personal threat from the changes • Genuine belief that “next generation” models are a bad idea

  26. Strategy

  27. Options for AMCs

  28. Clinical Strategies of Research Intensive AMCs NIH RANK INSTITUTION 1 JOHNS HOPKINS 2 UCSF 3 U MICHIGAN 4 U PENNSYLVANIA 5 U WASHINGTON 6 U PITTSBURGH 7 UCSD 8 WASHINGTON UNIVERSITY 9 YALE UNIVERSITY 10 UNC CHAPEL HILL

  29. Some Consistent Themes • Sufficient scale to build a regional system of care • Highly differentiated programs of excellence with well integrated basic & clinical research • Economic alignment with physician, academic and hospital partners • Increasing integration of clinical services • Primary care & ambulatory care expansion • Sophisticated analytics and IT infrastructure • Maximizing brand value • Quality: Measurable, Demonstrable, Superior

  30. AMC System

  31. Strategy Organization Execution

  32. Retreat Agenda

  33. Vision Questions • What mission will our clinical enterprise meet? • What will distinguish our clinical services and operating model from Kaiser? From Sutter? From Stanford? • If the distinctiveness is innovation, what does that mean? • Who will be part of the clinical enterprise? At what scale will we operate? • Will we be independent or part of a system? • What settings of care will be invested in? • What payment model will we operate under and how will we succeed with it?

  34. Clinical Enterprise SWOT Strength Weakness Threat Opportunity

  35. Clinical Enterprise SWOT Strength Weakness Threat Opportunity

  36. Clinical Enterprise SWOT Strength Weakness Threat Opportunity

  37. Clinical Enterprise SWOT Strength Weakness Threat Opportunity

  38. Proposed Vision as Developed by the Clinical Enterprise Group & Clinical Enterprise Strategic Planning Committee UCSF will be Northern California’s preeminent high value health system as defined by our success in providing innovative, high-quality, cost-competitive clinical services, and delivering an unparalleled patient experience across the entire care continuum.

  39. Vision: UCSF as the Preeminent High-Value System in Northern California Northern California System of Care UCSF Leading Acute Facilities Strong Primary Care Teams Cutting Edge Research High-Value, Quality Clinical Care World Class Education Strategic Regional Expansion Specialist Network Long-Term Care Regional T/Q Partnerships Clinical Research Implementation Home & Sub-Acute Care

  40. Strategic Priority 1: Grow Complex Care Referrals Via Innovation & Distinction System of Care with Referring Providers Patient Outcomes & Breakthrough Research Excellent Patient Experience

  41. Strategic Priority 2: Lead A High Value System of Care

  42. Strategic Priority 3: Build a Culture of Continuous Process Improvement Today: Organization in silos…. Tomorrow: Integrated organization that is high-quality and efficient

  43. Enablers of UCSF’s Strategic Priorities and Vision Develop Physician Services Train and Recruit The Next Generation Apply Research to Clinical Care Lead in Precision Medicine Establish Risk Management Capability Align Financial and Administrative Operations Build UCSF Brand

  44. UCSFCE Vision The preeminent high-value health system in Northern California ENABLERS STRATEGIC PRIORITIES

  45. Retreat Agenda

  46. UCSFCE Vision The Preeminent High-Value Health System in Northern California ENABLERS STRATEGIC PRIORITIES

  47. Imperatives

  48. UCSF Market Position: Overall Bay Area Market Share - Adults Adult IP Market Share – Bay Area CY 2011; Market Discharges = 524,170 ? Source: UCSF Data Reports and OSHPD; Excludes MS-DRG 795 Note: Counties included: San Francisco, Marin, Napa, Solano, Sonoma, San Mateo, Santa Clara, Alameda, Contra Costa

  49. UCSF Overall Adult Market Share by County Sutter is the second major player in SF County, and is very strong in the East Bay and Sacramento Filed Knox-Keene license to become a full service health plan Dignity Health’s positioning is strongest in the Far North, Sacramento & pockets of South Bay & Central Valley markets Brown & Toland has an approved Knox Keene license to manage global risk UCSF Overall Market Share by County UCSF’s Strongest Overall Market Share Stanford’s overall modest market strength remains mostly in the South Bay and Central Coast, but is aggressively moving into the East Bay Kaiser dominates the Bay area markets and parts of Sacramento

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