MaineCare Redesign Task Force

1. MaineCare Redesign Task Force September, 2012 Elizabeth Mitchell CEO Maine Health Management Coalition

2. Maine Health Management Coalitionwww.mhmc.info Employers 25 Private Employers 5 Public Purchasers Providers 15 Hospitals 15 Physician Groups Health Plans 5 Health Plans The MHMC is a purchaser-led partnership among multiple stakeholders working collaboratively to maximize improvement in the value of healthcare services delivered to MHMC members’ employees and dependents. The Maine Health Management Coalition Foundation is a public charity whose mission is to bring the purchaser, consumer and provider communities together in a partnership to measure and report to the people of Maine on the value of healthcare services and to educate the public to use information on cost and quality to make informed decisions. Collectively 40% of Comm. Market 1

3. MHMC Members MHMC Members

4. quality / outcomes + Value = improved health + employee satisfaction cost Best quality health care Best outcomes and quality of life Most satisfaction For the most affordable cost For all Maine citizens MHMC Value Equation

5. Maine’s Economy Has Moved From Manufacturing to Healthcare Manufacturing Health Care Manufacturing Health Care

6. Maine Has 5th Highest Insurance Premiums in U.S. For Singles Maine

7. Maine Has 10th Highest Insurance Premiums in U.S. for Families Maine

8. Premiums ~$650 Above Average:$150-200 Million Excess Costs $705 $614

9. More than a Million Preventable Errors & Adverse Events Annually Source: The Economic Measurement of Medical Errors, Milliman and the Society of Actuaries, 2010

10. Poor Quality Costs More On average, the cost of hospital stays for adults who develop health care-associated infections is about $43,000 more expensive2 • Every year 1.7 million people acquire health problems such as bacterial infections and incorrect blood transfusions after arriving at a hospital3—of these, nearly 100,000 die4 • Eighteen types of medical errors account for 2.4 million extra hospital days and $9.3 billion in excess charges each year. 9 2 Agency for Healthcare Research and Quality. Web. 20 Sept. 2011. http://www.ahrq.gov/ news/nn/nn082510.htm. 3 Centers for Disease Control and Prevention. Web. 10 July 2011. http://www.cdc.gov/ncidod/eid/vol7no2/wenzel.htm. 4” United States Department of Health and Human Services. Web. 23 Aug. 2011. http://www.hhs.gov/ash/ohq/. • "Safe Practices for Better Healthcare". National Quality Forum. Web. 20 Sept. 2011. http:// www.qualityforum.org/News_And_Resources/Press_Kits/Safe_Practices_for_Better_ Healthcare.aspx

11. Many Procedures Could Be Done for 80-90% Less Than Today 10-Fold Difference 5-Fold Difference

12. 20-25% of Chronic Disease Admits Return Within 30 Days

13. Maine Has 3rd Highest Rate of Surgeries in U.S. Maine

14. But Inpatient Utilization Is Low, Meaning Cost/Day is Higher Portland Source:CommercialCostVariationbyHospital ReferralRegion,MillimanAugust 2010

15. Spending on Physicians is Below Average Portland Source:CommercialCostVariationbyHospital ReferralRegion,MillimanAugust 2010

16. Even With Low Utilization/Costs,Significant Savings Opportunities 40%+ of low cost in Maine is“Potentially Avoidable” Source: Health Care Incentives Improvement Institute

17. To meaningfully reduce health care costs will require a fundamental restructuring of the system. The barriers to improvement are significant- lack of transparency, accountability, and effective incentives to name a few. New ways of caring for patients, new payment systems and new roles and responsibilities for all parties are required if we want a different outcome. Time to stop ‘rearranging deck chairs’

18. 4 Steps to Improving Health Care Value Performance Measurement and Public Reporting Consumer Engagement Value Based Purchasing Reformed Payment/Effective Incentives

19. Accountability Requires Transparency Meaningful system performance measurement and public reporting is necessary for accountability to purchasers, patients and the community. • Transparency of cost, resource use and appropriateness • Transparency of utilization rates and patterns • Transparency of patient outcomes and experience • Transparency of quality and safety

20. PTE Systems Employers/Health Plan Sponsors: • Christine Burke – MEABT • Joanne Abate – Delhaize America • Wayne Gregersen – Jackson Lab • Thomas Hopkins – U Maine System • Frank Johnson – State Employee Health and Benefits • Chris McCarthy, Manager – BIW Consumers: • David White, MHMC Foundation Board • SEHC member Providers: • Jeff Aalberg, MD – MMC PHO • Barbara Crowley, MD – MaineGeneral Health • David Howes, MD – Martins Point Healthcare • Jim Kane – CWM PHO • Donald Krause MD – St. Joseph Hospital • Jim Raczek, MD - EMMC Health Plans: • Bob Downs, Vice President - Aetna

23. Aims of Value Based Purchasing • Drive quality and cost transparency • Motivate performance improvement • Incent appropriate utilization • Reward good performance • Support fully engaged patients acting like consumers and partners

24. State of Maine Tiered Networks Hospital based on PTE Metrics - 2006 Added cost of care w/ quality Aug 2011 PCPs based on PTE Metrics - July 2007 Other Employers/Plan Sponsors Jackson Lab and Barber Foods – January 2011 U Maine System – January 2012 MMEHT – January 2012 Employer Use Employer Use 23

26. Employer members choose if/how to use performance measures Consistency across employers preferred by providers Gradual ‘raising of the bar’ on performance Transparent, multi-stakeholder process important to employees and providers Threshold: Achieving minimum of ‘Good’ in every category (only quality/safety for 5 years) Employer Use Employer Use 25

27. Exceptions made for ACO pilots: ‘Higher value initiatives’ MaineGeneral - PenBay - EMMC Drove provider and employer engagement on delivery system and payment reform RFP for direct contracts: Jackson Laboratories Network Design: MaineSense Employer Use Employer Use 26

28. Cost Variation

29. Publishing Hospital Costs How purchasers use the data is what matters: • Without tiering: Low cost hospitals sought higher rates • With tiering: High cost hospitals renegotiating lower rates to be included in network (4.7%)

30. “There is a growing recognition that our ability to control costs and improve quality will require an effective partnership with informed and engaged consumers.” -Dr. Judith Hibbard What Role Do Consumers Play?

31. Patients often do not have the tools to be effective partners • Lack of good information when they need it: price and quality • Lack of financial stake in selecting wisely or considering alternatives • Community and System Support: Even if they get to a high quality provider they often do not have proper support for follow through

32. If food prices had risen at medical inflation rates since the 1930’s*Source: American Institute for Preventive medicine

33. 2004: Adults receive about half of recommended care 54.9% = Overall care 54.9% = Preventive care 53.5% = Acute care 56.1% = Chronic care Not Getting the Right Care at the Right Time Quality Shortfalls: Getting it Right 50% of the Time Source: McGlynn EA, et al., “The Quality of Health Care Delivered to Adults in the United States,” New England Journal of Medicine, Vol. 348, No. 26, June 26, 2003, pp. 2635-2645

34. Employee engagement curriculum to develop optimal incentives and engage patients in their role to improve their health and healthcare: • Module 1: Examining What You Have, Determining What You Want • Module 2: Bright Spotting: Best Practice Locally, Regionally and Nationally • Module 3: Securing High Quality Healthcare Services • Module 4: Preventing Poor Health • Module 5: Monitoring Your Benefits Package to Assure the Best Value for Benefit Dollars

35. Benefit Design Changes AreAlso Critical to Success • Ability andIncentives to: • Improve health • Take prescribed medications • Allow a provider to coordinate care • Choose the highest-value providers and services • Ability and Incentives to: • Keep patients well • Avoid unneeded services • Deliver services efficiently • Coordinate services with other providers Benefit Design Payment System Patient Provider

37. Accountable Benefit Design

38. Some Feedback… ‘I am part of labor representing about 360 members.  My members can not afford a healthcare plan that does not give them the best possible outcome or quality of care. The classes have taught me the buying power of our group. We should not pay for bad results or poor quality of service. As consumers, we need to be more pro-active in our healthcare.’ - City of Portland Employee ‘Before I learned about the work of the Coalition, I thought the only thing I could do about healthcare was complain.’ - Prof. Arthur Hill, UMaine Employee

39. MHMC and the City City of Portland Unum Hannaford USM National Semi University of NE

40. Employers Pay For: Tests Visits Procedures Prescriptions Errors & Complications Employers Want: Informed Employees Improved Outcomes Care Coordination Prevention Functional Status Return to Work You Get What You Pay For

41. Current Payment Systems Reward Bad Outcomes, Not Better Health

42. Dr. Steele: The Way YOU Pay is a Major Part of the Problem! LOSE LOSE ER LOSE LOSE Rests on the head… ?? $$ of a pin $$ $$$

43. Payment Reforms Needed that Support Care Changes • It’s not about “risk” or “incentives,” it’s about giving healthcare providers the ability/flexibility to improve outcomes and reduce costs in a way that is financially feasible • Desired changes in care should drive payment reforms that support them, not the other way around • Principal Tools: • Episode-of-Care Payment • Risk-Adjusted Global Payment

44. Payers Need to Truly Align to Allow Focus on Better Care Payer Payer Payer BetterPaymentSystem B Better Payment System A Better PaymentSystem C Provider Patient Patient Patient Even if every payer’s system is better than it was, if they’re all different, providers will spend too much time and money on administration rather than care improvement

46. Data: The Foundation for Improvement MHMC Database serving as common database with New data partner (HDMS) to greatly enhance access and utility • Timely Multipayor Claims Data (will expand to include clinical) • Central Management and Analytic Support through MHMC • Desktop access with role-based authorization • Better understand the drivers of variation in quality, utilization, efficiency and cost • Evaluate the profile of your employee population to better target benefits and wellness programs • Benchmarks by region/business types

47. Many Changes in Care Needed to Achieve Significant Savings

48. Identifying Opportunities and Strategies for Win-Win Savings • Questions to Address: • Is this a desirable opportunity to pursue? • Does the opportunity vary among regions or among employers? • What are the barriers and how could they be overcome? • What does each stakeholder need to do differently to support success? • Employers/Medicaid • Health Plans • Hospitals • Physicians • Consumers/Patients/Families • What additional information is needed to develop the business case for a win-win-win approach and implement the changes?

49. As An Example… Priority 1: Reduce Hospital Admissions for People with Chronic Illnesses Changes Required: • Providers: Improve care transitions; develop PCMH and CCTs; use data to analyze admissions • Plans: Change reimbursement to reward primary and community based care including practice-based care management; enhance Rx coverage for patients with chronic illnesses; reduce cost sharing for preventive care; share data • Patients: Participate in care management and partner with providers • Purchasers: Benefit incentives for participation in care management; Education and wellness activities for employees with chronic conditions • Others: Public health initiatives to reduce chronic illness Implications of Reductions: Fewer hospital admissions will require hospitals to reduce staff/infrastructure with community wide economic impact.