ACO Accelerated Development Learning Session Case Study 3: Building an ACO on the Foundation of an Integrated Delivery San Francisco, CA September 15-16, 2011 System Date: September 15, 2011 Time: 10:00 – 10:20 a.m. Francis J. Crosson, MD Director, Public Policy The Permanente Medical Group Kaiser Permanente DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
America’s Largest Nonprofit Health Care Organization • Fully integrated health care delivery system • 8.6 million members • 15,000+ physicians • 166,000 employees • 8 regions serving 9 states and DC • 35 hospitals and medical centers • 441 medical offices • 450,000 surgeries • 85,000 deliveries • $45 billion annual revenue (2011) DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 2 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Kaiser Permanente REVENUE POPULATION Health Plan Members Group / Individual Contracts ------------------------------------------------------------------------------------------------------------ EXPENSE Kaiser Foundation Permanente Kaiser Hospitals Medical Groups Foundation Health Plan Hospital Service Medical Service Agreement Agreement Operating Budgets Capitation to the Group DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 3 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Kaiser Permanente Experience — Six Prerequisites for Success • A common vision and sense of purpose • Integration • Trusted governance • Physician leadership • An effective management structure • Aligned financial incentives DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 4 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
A Common Vision and Sense of Purpose • Should be more than financial • Should connect to quality of care and other professional values (the Physician Charter) • Should contain a sense of common destiny and common responsibility for performance DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 5 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Delivery of Care in the United States LESS INTEGRATED SYSTEMS IPAs • Single MDs Hospital/staff Single specialty • Small groups groups Some faculty practices Hospital chains • Single hospitals MORE INTEGRATED SYSTEMS Multi-specialty group Integrated delivery Fully integrated practices with systems systems hospital affiliations – Henry Ford – Kaiser Permanente – Marshfield Clinic – Mayo – Group health – Harvard Vanguard cooperative – Geisinger – Vanderbilt University – Ochsner – California groups DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 6 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Levels of Integration Fully integrated MSGP, hospital, and insurance system Increasing integration Delivery MSGP and hospital system integration Multi-specialty group practice ( MSGP) DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 7 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Types of Integration • Clinical — shared responsibility for quality • Financial — shared responsibility for costs • Functional — shared capabilities • Structural — shared governance and management DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 8 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Trusted Governance • Principled • Participatory • Perceived as equitable • Persistently focused on strategy DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 9 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Physician Leadership • Multi-level • Multi-knowledgeable • Selected, developed, and trained • Supported by “followership” DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 10 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
An Effective Management Structure • Multi-level • Matrixed (administrative and clinical) • Supported by accurate and timely data • Persistently focused on performance DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 11 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Aligned Incentives • Mission • Quality • Reputation • Sustainability • Career and professional enhancement • Financial DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 12 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
A Schematic of ACO Risk Assumption Full Risk California “Delegated Model” Capitation Corridor Permanente Medical Groups Capitation “Depth” of Risk FFS +/- Bundled Payment “Bonus” ACA Shared Savings Model FFS + Medicare Group Practice Demo “Bonus” PCMH FFS Only Primary Specialty Hospital Referral Non Admin. Prescr. Care Care Costs Costs Referral RK (B) Rx (D) Costs “Breadth” of Risk DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 13 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Tools and Resources • Crosson, FJ, The Accountable Care Organization: Whatever Its Growing Pains, the Concept is Too Important to Fail, Health Affairs 30:7 (2011) 1250 – 1255 • Partners in Health: How Physicians and Hospitals Can Be Accountable Together (Crosson, F and Tollen, L, editors.) Jossey Bass (Wiley), San Francisco, 2010 • Kirch, DG, and Vernon, DJ, The Ethical Foundation of American Medicine: In Search of Social Justice, JAMA (2009) 301(14): 1482 – 1484 • Medical Professionalism in the New Millennium: A Physician Charter (2005), ABIMF, ACPF and EFIM DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid 14 Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
Case Study 3: Building an ACO on the Foundation of an Integrated Delivery System Francis J. Crosson, MD Director, Public Policy The Permanente Medical Group Kaiser Permanente Jay.Crosson@kp.org DISCLAIMER . The views expressed in this presentation are the views of the speaker and do not necessarily reflect the views or policies of the Centers for Medicare & Medicaid Services. The materials provided are intended for educational use, and the information contained within has no bearing on participation in any CMS program.
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