Understanding the Evolving Rural Marketplace

1. Understanding the Evolving Rural Marketplace Cost, Quality, Access, and Population Health Andrew Busz, FAHM, Policy Director, Finance Ian Corbridge, RN, MPH, Policy Director, Clinical Issues June 24, 2014

2. How is Rural Different? Geography Population/Demographics Payor Mix Volume of services- Impact on cost per unit due to higher proportion of overhead costs Capitation and risk sharing difficult due to low enrollment numbers.

3. The Jigsaw Puzzle of Provider Types in Rural Areas. Combines different approaches to ensure access to care in rural areas. The mix of provider types and degree of collaboration is unique to each community.

4. Critical Access Hospitals Restricted in some ways, granted greater flexibility in others compared to larger hospitals Cost-based payment for Medicare and Medicaid

5. Federally Qualified Health Centers Specific board structure, including consumers Serves underserved clientele in urban and rural areas Provides wrap-around services Required to take all comers on a sliding-scale basis Paid an encounter rate by Medicare and Medicaid FFS, rather than fee schedule

6. Rural Health Clinics Required to employ or contract with mid-level providers (PA or ARNP) Paid an Encounter Rate by Medicare and Medicaid FFS, rather than fee schedule Encounter rate for hospital-based RHCs reflects hospital cost component

7. Free Clinics Primary clientele is uninsured population Primary financial support through donations or hospital sponsorship Clinical care provided by area providers on a volunteer basis Many now closing due to ACA coverage expansions

8. Independent Physicians and Clinics Paid regular fee schedule by Medicare, Medicaid, and Commercial Insurance Increasingly rare in rural areas due to payor mix

9. Public Health and Social Service Agencies Publically funded Focus on population health and preventative services Provides services generally not covered by insurance

10. Regional Support Networks and Community Mental Health Funded directly by the state Regionally organized Generally coordinated with, rather than integrated with medical services

11. Population Health and Quality in Rural Areas – the Current Environment

12. A Health Snapshot County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

13. What Influences Health County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

14. Funding Population Health Poor incentives Eroding funding for public health Grants, are they a solution or a double edged sword CDC, accessed on 6/1/14 http://www.cdc.gov/nchs/data/hus/hus13.pdf#112

15. Community Health Needs Assessment – A Brief Look

16. Population Health Quality • USPSTF prevention screening recommendations are free under the ACA… however • Poor prevention screening across the state • Rural residents are less likely to receive preventive services The Commonwealth Fund and NORC, accessed on 6/1/14 http://www.commonwealthfund.org and http://NORC.org

17. Population Health Quality (cont’d)Mammography Screening County Health Rankings, accessed on 6/1/14 http://www.countyhealthrankings.org/resources

18. Rural Quality Measurement Largely sheltered from national level measurement • Us-side vs. Down-side Challenge of the “small N” Few rural specific measures • NQF website – 7 measures tagged with a “rural” designation • Total NQF measures = 637 Are rural specific measures needed?

19. The Managed Care Environment

20. Managed Care Plans Defined population and benefits Historically focused on per unit costs Short term return horizon Risk avoidance Historically not responsible for global issues such as uninsured costs, teaching costs, or overall population health

21. Current Managed Care Workarounds for Rural Providers Medicare Advantage: based on FFS cost-based or encounter rates Medicaid: enhancement/reconciliation to shield plans from higher per unit costs Commercial: percent of charge rather than prospective arrangements

22. Threats to Critical Access Hospitals Cost-based payment/ geographic restrictions Provider supervision changes Length of stay restrictions/ 96 hour rule Inadequate network adequacy standards

23. Threats to FQHCs and RHCs “The FQHC/RHC’s unique payment methodology does not always promote efficiency and value and increasingly impedes some state’s evolving delivery system and payment transformations.” 2/24/2014 letter from National Association of Medicaid Directors to HHS

24. Making the Transition

25. Accountable Care Organizations Requires large population/geography Requires sophisticated data, contracting, and EHR capabilities Ability to provide full range of services Barriers: • Lack of data to manage care • Restrictions on clinical integration

26. State Health Care Innovation Project (SHCIP) and Transformation All-payor Database –Claims data Availability and sharing of EHR data Role of Accountable Communities of Health (ACH) Proper allocation of funding that targets root determinants of health while maintain viability of medical infrastructure and access to care

27. What Direction Will Things Take? Payor ACO Provider Plan ACH

28. Population Health and Quality in the Emerging World

29. Supporting Population Health • Health care will have greater accountability for the health of a community • Do we have the right: • Partners, • Resources, and • Payment structure… To deliver population health?

30. Improving Population Health – Federal Efforts ACA • Public Health Fund • Free prevention screening (SUPSTF A & B) • CMS Innovation Center – State Innovation Models (SIM) program grants • Greater focus on population health measures

31. Improving Population Health (cont’d) –State and Local Efforts State Innovation Bill (2572) • Communities of health • Extension program • All payer claims database • Common performance measures Behavioral Health Integration Bill (6312) State SIM grant application – core focus areas: tobacco use, obesity and diabetes…

32. Opportunities to Enhance Rural Population Health Improvement Efforts Local collaboratives with broad representation Increased focus on screening and prevention Measurement • Rural specific measures • Focus on ambulatory care and screening measures Use of HIT and new data systems to track and improve quality

33. WSHA – Leading Population Health for our Members WSHA will: • Explore state wide population health goal • Help support partnerships and collaboration • Toolkit to support community engagement • Support the dissemination and spread of new ideas/best practices across stakeholders • Work toward aligning incentives to support population health

34. Questions and Comments Andrew Busz andrewb@wsha.org Ian Corbridge ianc@wsha.org