Becoming a Value-Driven Lab The Lab’s Role in Care and Cost Transformation

1. Becoming a Value-Driven LabThe Lab’s Role in Care and Cost Transformation Karen Kaul, M.D., Ph.D. Chair, Pathology/ Lab Medicine NorthShoreUniversity HealthSystem Clinical Professor of Pathology University of Chicago Pritzker School of Medicine

2. DISCLOSURES: No Relevant Financial Relationship(s) No Promotion of Off Label Usage

4. CMS Goals: • Reduce per capita cost • Improve quality of episodic care • Improve population health Labs are well-positioned to influence cost and quality

5. New Financial Realities in Healthcare • Lab testing: $60 billion • 4% of health care cost (1.5% of Medicare) • dictates 70% of downstream spend • Increases of 4-5% annually • Federal government now funds > 50% of our nation’s $3.8 trillion expenditures • Already seeing CMS cuts • 11% reimbursement cuts since 2010 • 26% reimbursement cuts expected in 2014

6. Lab’s role in Care Transformation • Transition from fee-for-service • Volume-based system becomes quality and efficiency-based delivery • Improve outcome, reduce over all cost of care • Lab must reduce cost and increase value • Look beyond traditional models and roles

7. Lab’s role in Care Transformation • Reduce waste, unneeded testing • Use of appropriate testing • Faster, more valuable results • Coordinate lab tests across spectrum of care • Inpatient, outpatient, outreach • Be more integrated, more available to care team • Create IT solutions

8. Laboratory Outreach • Added volume brings incremental benefits • Decreased cost per test

9. Optimize operations as a System Core tertiary-care hospital 3 integrated hospitals 14 Patient Service sites 7 Outpatient Draw sites 88,000 Courier stops

10. Leverage Outreach • Outreach clients have become Medical group members – incentivize system operation • Fewer independent docs; limits new opportunities • Novel outreach opportunities • Home Health • Nursing homes • Infection control • Routine lab testing, phlebotomy • Radiology services

11. Laboratory Outreach Future: need to operate as system • All testing in same system, same lab, same platform • Continuity of care • Coordinate inpatient/outpatient/outreach testing • Service providers to nursing homes, home health • Point of Care

12. Laboratory Outreach Future: need to operate as system • All testing in same system, same lab, same platform • Continuity of care • Coordinate inpatient/outpatient/outreach testing • Service providers to nursing homes, home health • Point of Care Interface ordering, resulting Allows application of test utilization rules

13. Lab utilization projects at NorthShore • Lab Practices Committee • Oversight of send-out tests • Move sendouts to outpatient setting • Lab formulary • Reduce unnecessary testing • Pathologist directed disease work-ups • Transfusion guideline enforcement • Improve lab consultations

14. Opportunities for Lab utilization improvement • Right test at the right time • Clinician understanding of 50-100 tests • Strongest predictor of clinician lab order patterns is residency • Technology evolving quickly • Tests over-ordered? under-ordered? • Who orders tests? • Nomenclature

15. Algorithm-driven ordering

16. CBC with differential Hours between reported result and next order

17. Surveyed Physicians’ reasons for ordering multiple CBC with diff tests within 24 hours on inpatients

18. Potential financial impact, CBC/diff Average of 505 tests per month ordered more frequently than q 24 hours on inpatients Potential cost impact: 500 x $4 = $2000 (Automated diff) 100 x $10 = $1000 (Manual diff) $3000 monthly for one test

19. Germline genetic tests: “Once in a Lifetime” • OverorderedGermline tests: • Hypercoagulation mutation assays • CF carrier testing • SMA carrier testing • Ashkenazi prenatal panels • Pharmacogenomics • Cancer Risk panels

20. Once in a Lifetime intervention • Need unique test code • Ability to scan over all encounters • Designed BPA to present previous test results

21. Best practice alert used

22. Once in a Lifetime Alert - Stats Deployment Date: Jun 11, 2012 Duplicate CF testing: Cost savings significant But….why 25% still ordered?

23. Inpatient vs Outpatient Efforts • Focus utilization control efforts on inpatient labs • DRGs vs CPT billing • Will need universal utilization control eventually

24. Blood utilization • Major source of variability and expense • Significant implications for clinical outcome

25. Randomly assigned ICU pts.- Restrictive (hgb <7.0, target 7-9)- Liberal (hgb <10.0, target 10-11)- 1o outcome; 30 day mortalityYounger & less-sick patients did BETTER with less blood Hebert, NEJM, 1999

26. Pulmonary and cardiac outcomes drove improvement Hebert, NEJM, 1999

27. Utilization data slides RBCs/100 DC compares favorably with other academic medical centers SK is an outlier 16 RBCs/100 DC at SK would = 338 RBCs saved, $67,648 A B C D Total

28. NS Medicine patients; back-to-back RBCs

29. Potential cost savings • Improvement in quality of patient outcome • Reduce unreimbursed care • Reduce purchase of blood products • Extend to platelets, plasma, other products

30. Lab performance standards in AP • Historical indicators: • TAT, frozen/permanent agreement rates • Systems for data gathering evolving • New indices for efficiency and quality • Standards for recuts, deeper sections • Use of IHC, special stains • Cost per diagnosis? • Adherence to guidelines

31. Pap Smears and HPV:Adherence to guidelines ASCCP guidelines for HPV testing: • HPV testing not indicated under age 21 • HPV if ASCUS in women aged 21-29 • HPV for primary screening over age 30, can extend follow-up interval Informatics methods for laboratory evaluation of HPV ordering patterns • Jackson and Shirts, JPI 1:26, 2010

32. Increasing consultation and communication • Electronic communications prevail • Information at fingertips

33. The Lab Help Button • Select the Lab Help buttonto select the appropriate action • Contact the Lab allows physicians to send an InBasket Message to pathology • Pathology Resources displays a webpage with links to pathology related information

34. In Basket Message Message is prepopulated with custom SmartText to lead the user through the process of receiving help.

35. Notification The on-call resident will receive a page as notification that a Lab Help Message has been sent to their In Basket.

36. The Message Log into Epic and select In Basket and the Lab Help Message folder to review the message.

37. Searchable Test Catalog • Searchable Test Catalog provides a link to the NorthShore Test Catalog on NorthShore Connect within Epic.

38. Lab automation

39. Value of new technologies • Workload efficiency • Addresses aging workforce issues • Lower cost • Flexible work schedule • Faster results • Continual incubation • Molecular and MALDI detection • Faster diagnosis and treatment

40. Total Microbiology Automation

41. Audience response:What lab utilization tools have you employed? • Test formulary • Review of expensive send-out tests • Bringing send-outs in house • Limited order-ability/deemed users • BPAs/pop-ups • Algorithms/pathologist directed work-ups • Improved communications

42. New Technologies in the Lab • Upgrade automation in Core lab, Microbiology • MALDI-ToF in microbiology: reduce LOS • Instrument interfacing and autoverification • CPOE • Bar-code sample tracking • Telepathology, digital pathology in AP • Array technology and Next Generation Sequencing

43. Lab value and cost efforts • Increase impact of testing • Improve overall patient outcome • Episodes of care • Increase support of clinical colleagues • Population health management • Reduce waste • Reduce testing • Find efficiency

44. How do we get this all done? • Secure IT resources/influence • Lab-Based HIT representation • Lab-focussed HIT optimization staff • Demonstrate savings to administration • Incentivize department staff • Negotiate incentives for results • Share risk and reward