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Transforming Healthcare Collaboration among Payors, Providers and Community Leaders. Vinod K. Sahney, PhD Senior Vice President and Chief Strategy Officer Presented at Purdue University November 29, 2006. Outline. Introduction Performance of U.S. Healthcare System

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Transforming healthcare collaboration among payors providers and community leaders

Transforming HealthcareCollaboration among Payors, Providers and Community Leaders

Vinod K. Sahney, PhD

Senior Vice President and Chief Strategy Officer

Presented at Purdue University

November 29, 2006


Outline
Outline

  • Introduction

  • Performance of U.S. Healthcare System

  • Collaboration to Improve Access to Healthcare

  • Collaboration to Improve Healthcare Delivery System

  • Collaboration to Improve Quality of Care in Massachusetts

  • Growing Conflicts

  • Conclusions


Introduction key messages
Introduction: Key Messages

  • Healthcare Delivery – Non System

  • Lack of Aims for Improvement

  • System Performance Compares Poorly to Developed Nations

  • Focus on Medical Technology Gives False Sense of Quality

  • Enough Money in System to Cover All

  • Collaboration Initiatives – Improve Care and Health Status

  • Leadership by Community Organizations Needed



Premium costs have risen five times faster than inflation and four times faster than wages
Premium costs have risen five times faster than 2000 Dollars inflation and four times faster than wages

Health Insurance Premiums Compared to Other Indicators

Percent Increase

Source: Employer Health Benefits Survey, KFF, 2004


International healthcare trends
International Healthcare Trends 2000 Dollars

In fact, the U.S. spends much more per person on healthcare than other countries, as well as a larger percent of Gross Domestic Product.

International Health Spending per Capita 2002

U.S.

($5,267, 14.6%)

Switzerland

($3,446, 11.2%)

Turkey

($446, 6.6%)

Canada

($2,931, 9.6%)

U.K.

($2,160, 7.7%)

Japan

($2,077, 7.8%)

Mexico

($553, 6.1%)

Poland

($654, 6.1%)

Note: Because these data are based on Purchasing-Power Parity values, they will differ slightly from earlier values cited herein.

Source: Adapted from Anderson, GF et al. (2005) Health Affairs


National healthcare trends
National Healthcare Trends 2000 Dollars

Healthcare expenditures are projected to more than double between 2000 and 2010,

and healthcare is expected to account for 17% of the Gross Domestic Product by 2010.

National Health Expenditures (NHE) and Percentage of GDP2000-2010

*Projected by Centers for Medicare and Medicaid Services.Source: Adapted from Centers for Medicare and Medicaid Services (2005a)


And retirees are not faring any better
…and retirees are not faring any better 2000 Dollars

  • According to an analysis by the Urban Institute, by 2030 out-of-pocket expenses for retirees will consume:

    • • 30.3% of income for older unmarried adults, up from 17.3% in 2000, and

    • 35.1% of income for older married couples, more than double the 16% in 2000

Source: Henry E. Simmons, Pres. National Coalition on Health Care. November 14, 2005 address to International Foundation of Employee Benefit Plans


National scorecard on u s health system performance commonwealth fund september 2006
National Scorecard on U.S. Health 2000 DollarsSystem Performance (Commonwealth Fund, September 2006)


National scorecard on u s health system performance commonwealth fund september 20061
National Scorecard on U.S. Health 2000 DollarsSystem Performance (Commonwealth Fund, September 2006)


National scorecard on u s health system performance commonwealth fund september 20062
National Scorecard on U.S. Health 2000 DollarsSystem Performance (Commonwealth Fund, September 2006)


Why are we in this situation
Why Are We In This Situation? 2000 Dollars

  • No national healthcare goals

  • No organized leadership for improvement

  • Cottage industry structure

  • Defined benefit with no planning

  • No accountability

  • No one owns enough of the system to enforce change


Massachusetts healthcare reform

Massachusetts 2000 DollarsHealthcare Reform


Health care reform the genesis
Health Care Reform: The Genesis 2000 Dollars

  • October 31, 2003:

CONSENSUS DECLARED AT THE BCBSMA FOUNDATION: WE NEED A ROADMAP TO HEALTH CARE REFORM

CONSENSUS DECLARED AT THE BCBSMA FOUNDATION: WE NEED A ROADMAP TO HEALTH CARE REFORM


Healthcare reform timeline
Healthcare Reform Timeline 2000 Dollars

  • Health care reform has dominated the political landscape for over one year.

House, Senate final bills/ conference committee appointed

Governor, Senate bills released

House bill released

Governor signs into law

Legislation drafted

Legislation finalized

_________________

Summer 2004 to early 2005

October 2005

November 2005

April 2005

April 4, 2006

April 12, 2006


Expanding the focus
Expanding the Focus 2000 Dollars

  • As first proposed, the concept of health care reform was about:

  • Lowering health care costs for employers

  • Efforts to enroll those eligible for Medicaid but unenrolled

  • Increasing access to care


Expanding the focus1
Expanding the Focus 2000 Dollars

  • With input from BCBSMA, other issues were added to the mix:

  • Addressing the Quality of Care

  • Medicaid Provider Shortfalls

In the end, all the issues came together in one bill.


Massachusetts the key elements of reform
Massachusetts: 2000 DollarsThe Key Elements of Reform

  • Medicaid Expansions

  • Health Insurance Connector

  • Commonwealth Care – Premium Subsidy Program

  • Individual Mandate for all MA adult residents

  • Health Insurance Market Reforms

  • Employer Responsibilities (for firms > 11 employees)

  • Medicaid provider rate increases


Ma health care reform law key components
MA Health Care Reform Law 2000 DollarsKey Components

  • $540+ million over next 3 years

  • Hospitals increases to be tied to quality standards in areas including addressing health disparities

Medicaid provider rate increases for hospitals, physicians and community health centers


Ma health care reform law key components cont d
MA Health Care Reform Law: 2000 DollarsKey Components (cont’d)

  • Commonwealth Health Insurance Connector

  • New public authority (10-member board)

  • Administers “Commonwealth Care” low income premium subsidy program

  • Will offer “affordable” health insurance products to individuals and small businesses (50 or fewer employees)


Ma health care reform law key components cont d1
MA Health Care Reform Law: 2000 DollarsKey Components (cont’d)

  • <100% FPL – fully subsidized, comprehensive benefits (including dental)

  • 100-300% FPL - sliding scale subsidies, no annual deductibles

Commonwealth Care Health Insurance Program (C-CHIP) – Premium Subsidy Program


Mass health care reform law key components cont d
Mass Health Care Reform Law 2000 DollarsKey Components (cont’d)

  • Individual Mandate for all MA adult residents

  • Enforcement mechanisms

    • Indicate insurance policy number on state tax return

    • Loss of state personal income tax exemption for tax year 2007

    • Fine for each month without insurance equal to 50% of affordable insurance product cost for tax year 2008


Mass health care reform law key components cont d1
Mass Health Care Reform Law 2000 DollarsKey Components (cont’d)

  • Health Insurance Market Reforms

  • Non-group and small-group insurance markets merged

  • Young Adult plans for 19-26 year olds

  • Age for eligibility for dependent coverage for health insurance raised to 25 years


Ma health care reform law key components cont d2
MA Health Care Reform Law 2000 DollarsKey Components (cont’d)

  • Employer Responsibilities (for firms > 11 employees)

  • Must offer access to pre-tax purchase of health insurance

  • “Fair share” assessment of no more than $295 per worker


Stakeholders
Stakeholders 2000 Dollars

  • Health advocacy organizations

  • Organized labor

  • Business community

  • Hospitals

  • Health plans

  • Faith-based organizations

  • Physicians

  • Community Health Centers

  • Nurses

  • Appointed and elected officials


Health care delivery system introduction key messages
Health Care Delivery System: 2000 DollarsIntroduction: Key Messages

  • Serious Problems in Quality

  • Great Degree of Variability

  • Source of Problems – Systems

  • Increased Quality and Cost Reduction Possible

  • Immediate Benefits by Improving Reliability of Healthcare Delivered


Conformance with care agreed by us health experts
Conformance With Care Agreed by 2000 DollarsUS Health Experts


And the latest large american study
And the Latest Large American Study… 2000 Dollars

  • McGlynn, et al: The quality of health care delivered to adults in the United States. NEJM 2003; 348: 2635-2645 (June 26, 2003)

    • 439 indicators of clinical quality of care

    • 30 acute and chronic conditions, plus prevention

    • Medical records for 6712 patients

    • Participants had received 54.9% of scientifically indicated care (Acute: 53.5%; Chronic: 56.1%; Preventive: 54.9%)

  • Conclusion: The “Defect Rate” in the technical quality of American health care is approximately 45%


Clinical effectiveness
Clinical Effectiveness 2000 Dollars

  • Focusing on effectiveness and efficiency of clinical processes

  • Great deal of variability within university hospitals:

    • Major surgery complications 49%

    • CHF re-admission rates 49%

    • Mortality 30%

    • Total direct costs/OR hour 24%

    • Total cost/adj. discharge 80%


Collaboration to improve healthcare delivery system

Collaboration to Improve Healthcare 2000 DollarsDelivery System


Ihi mission
IHI Mission 2000 Dollars

  • The Institute for Healthcare Improvement is a not-for-profit organization driving the improvement of health by advancing the quality and value of health care.


Ihi vision
IHI Vision 2000 Dollars

  • The Institute for Healthcare Improvement is a premier integrative force, an agent for profound change, dedicated to improving health care for all. Our measures of success include improved safety, effectiveness, patient-centeredness, timeliness, efficiency, and equity.


Ihi initiatives
IHI Initiatives 2000 Dollars

  • Breakthrough Series

    • Emergency Rooms

    • ICU

    • Surgical Infection

    • Ventilator Associated Pneumonia

  • Pursuing Perfection – 13 Hospitals

  • Impact Network – 210 Hospitals

  • Care at the Bedside

  • Patient Safety Officer Training

  • Executive Quality Academy


Ihi breakthrough series 6 to 13 months time frame
IHI Breakthrough Series 2000 Dollars(6 to 13 months time frame)

Participants (10-100 teams)

Select Topic (develop mission)

Prework

Congress,

Guides,

Publications

etc.

P

P

Develop

Framework

& Changes

P

A

D

A

D

A

D

Expert Meeting

S

S

S

LS 2

LS 1

LS 3

Planning Group

Supports

Email Visits

Phone Assessments

Monthly Team Reports


Ihi 100 000 lives saved campaign
IHI – 100,000 Lives Saved Campaign 2000 Dollars

  • Campaign: December 2004 - June 2006

  • Save 100,000 lives by improving reliability of healthcare within U.S. hospitals

  • Target 2,300 hospitals

  • Six proven initiatives


Six initiatives
Six Initiatives 2000 Dollars

  • Deploy “Rapid Response Teams” at the first sign of patient decline

  • Deliver reliably, evidence-based care for acute myocardial infarction

  • Prevent adverse drug events by implementing medication reconciliation

  • Prevent central line infections – Implement bundles

  • Prevent surgical site infections – Implement bundles

  • Prevent ventilator associated pneumonia – Implement bundles


Accomplishments
Accomplishments 2000 Dollars

  • Co-Sponsors:

    • Agency for Healthcare Research and Quality

    • American Medical Association

    • Association of American Medical Colleges

    • Center for Medicare and Medicaid

    • Joint Commission on Accreditation of Healthcare Organizations

    • National Patient Safety Foundation

    • University Health System Consortium

    • American College of Cardiology


Accomplishments continued
Accomplishments (continued) 2000 Dollars

  • Co-Sponsors (continued):

    • Centers for Disease Control and Prevention

    • Society for Healthcare Epidemiology of America

    • American Nurses Association

    • Leapfrog

    • The National Business Group on Health

    • 20 State Hospital Associations

  • 3,300 Hospitals Voluntarily Signed Up

  • $15M Private Contributions

  • 122,000 Lives Saved


Collaboration to improve quality of care in massachusetts

Collaboration to Improve Quality of Care 2000 Dollarsin Massachusetts


Seven levers of change
Seven Levers of Change 2000 Dollars

  • Governance Focus

    • Trustees as champions of New Quality Standards

    • Governance Practices Linked to Hospital Contracts

  • Quality and Safety Standards

    • Adoption of Standardized Quality Measures

    • Transparent Reporting of Performance Information

    • Public Recognition Programs to Highlight Extraordinary Achievements in Quality Improvement


  • Seven levers of change cont d
    Seven Levers of Change (cont’d) 2000 Dollars

    • Financing and Incentives

      • Incentives to Achieve New Quality Performance Standards

      • Partnerships with Multiple Quality Improvement Organizations Including IHI, Dartmouth, Rand

      • Funded 100,000 Lives Saved Campaign

        • $35K to each hospital

        • $5M contribution

      • $400M in Incentives Tied to Quality Goals

      • Redesign Payment Systems to Reduce Overuse and Misuse


    Seven levers of change cont d1
    Seven Levers of Change (cont’d) 2000 Dollars

    • Legislation and Regulation

      • Cost and Quality Council

      • Healthcare Reform

  • Public Engagement

    • Segmented Focus Groups

    • Seminar Series – Public Forums

    • Public Education

    • Eastern Massachusetts Health Collaborative


  • Seven levers of change cont d2
    Seven Levers of Change (cont’d) 2000 Dollars

    • Technology

      • E-Health Collaborative

      • Three Communities

      • 500 Physicians

      • $50M Investment

  • Organizational Readiness

    • LEAD Organization

    • Capability Building


  • Growing conflicts

    Growing Conflicts 2000 Dollars


    Growing conflicts1
    Growing Conflicts 2000 Dollars

    • A. Demographics:

    • Beneficiaries vs. Contributors

      • Aging of population

      • Utilization increases exponentially with age:

        • 65 years vs. 45 years 2 times

        • 85 years vs. 45 years 4 times

        • 95 years vs. 45 years 8 times


    Growth trends aging baby boomers

    Growing Conflicts 2000 DollarsGrowth Trends – Aging Baby Boomers

    Growth Trends - Aging Baby Boomers

    • By 2030 one fifth of the population will be over 65 years of age

    Elderly Population by Age, 1990 to 2050:

    Percent 65+ and 85+


    Health Spending and Aging 2000 Dollars

    Selected OECD Countries 2000

    Now over 16%

    U.S.

    Switzerland

    Germany

    Canada

    France

    Netherlands

    Australia

    Sweden

    Japan

    U.K.

    Iceland

    Source: OECD Data, 2002


    Growing conflicts2
    Growing Conflicts 2000 Dollars

    • B. Acute Care vs. Chronic Care

      • Half of seniors have at least one chronic condition:

        • arthritis: 49%

        • hypertension: 36%

        • hearing impairment: 30%

        • cardiovascular disease: 27%

      • Chronic care now accounts for more than 70% of all healthcare expenditures:

        • acute care system trying to deliver chronic care


    Growing Conflicts: 2000 DollarsCurrent Environment - Crumbling

    • C. Severe Workforce Shortages:

      • Nursing

      • Pharmacy

      • Radiology technicians

      • Physicians - specialties


    Current Environment – 2000 DollarsCrumbling Foundation

    • D. Growing Complexity of Science and Technology:

      • Rapidly expanding knowledge base

      • Significant investment in R & D

      • New medical technologies:

        • transplantation

        • laparoscopic procedures

        • robotic surgery

        • CT/PET scanners

        • gene therapy

        • implants

  • E. Rising Uninsured and Underinsured


  • Growing Conflicts 2000 Dollars

    • Healthcare in the USA is at a crossroad:

      • Managed care rejected

      • Healthcare benefit cost increasing rapidly


    Conclusions

    Conclusions 2000 Dollars


    Conclusions1
    Conclusions 2000 Dollars

    • Large Country with Diverse Population

    • Time for Leadership

    • Healthcare Score Card

    • Aims for Regional Healthcare

      • Universal healthcare

      • Primary care and public health

      • Coordinated care

      • Transparency

    • Coalition for Healthcare System Change


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