What’s Next for Value Based Care? 4.26.19
Introductions Dave Spalding Erica Maltby 2017 co- Founded TMA 2017 co- Founded TMA Specialty • • Specialty Services Services CEO TMA Specialty Services VP Operations TMA Specialty • • Has co-founded 3 value based Services • care companies, including TMA Consultant developing payer data • PracticeEdge strategies around Value Based HCSC/Blue Cross Executive Care • Innovation team at Optum • developing analytic products
Agenda 1. Current state of Value Based Care 2. Emerging Models 3. How to Prepare
A Brief History of Value Based Care Value Based Care is the shift from payment based on V olume to V alue • Driven by MACRA legislation in 2015, which introduced MIPs and APMs to • Medicare payments MIPs and APMs seek to measure V alue and incentivize lowering cost and • improving quality Objective of this shift is to align incentives of the entire healthcare system- • payers, providers, device makers, drug manufacturers, etc. “Never, ever, think about something else when you should be thinking about the power of incentives” - Charlie Munger
The Good The Bad Investment required to stay 1/5 dollars are spent on healthcare- • • compliant is forcing out patients should expect Value independent physicians Increased use of data and comfort • Measures of value lack clinical with reporting • value Bonus opportunity for APM • participation Required Payments of Patients Thresholds per Program Year 75% 75% 80% 60% 50% 50% 50% 50% 35% 35% 40% 25% 25% 20% 20% 20% 0% 2017 2018 2019 2020 2021 2022 Payments through APMs Patients in APMs
Value Based Spectrum Upside / downside cost How is VBC defined? arrangements for beating benchmarks • BPCIA • ACO tracks 1+ - 3 Shared Risk • Capitation Bonuses for hitting Quality targets • Defined measures in commercial contracts • Device and drug manufacturers included • “The agreement ties a component of our reimbursement to Shared Savings successfully meeting clinical improvement thresholds” - Medtronic and Aetna Upside-only cost arrangements for beating benchmarks Performance • Bonus (P4P) ACOs • PCMHs • ESCO Fee for Service Pay for V olume
APM Adoption Trends HCP&LAN Payment Categories 2015-2017 Health Care Payment & Learning Action Network Annual 100 Survey • Data submitted by CMS, BCBSA, AHIP Category 3 & • Over 82-84% of covered lives nationally 4 80 Category 1 – FFS 60 Category 2 Category 2 – Quality / P4P Category 3 – APM with FFS architecture 40 Category 4 – Population-based risk Category 1 20 TRENDS 2015-17 • Since 2015, the FFS-only (category 1) has 0 decreased from 63% of payments to 41% 2015 2016 2017 • Shared savings and risk-based payments The commercial market lagged (categories 3 & 4) have increased from 23% to Medicare with 28% of payments in 34% since 2015 category 3 & 4 in 2017. Specialty • In 2017, Medicare Advantage led APM episodes represented less than 8.5% of adoption with 49.5% of payments in savings / risk commercial VBC payments . models, including 15% in specialty episodes . 2019-20 Cost shifting benefits from high deductible plans are tapped out and employers are accelerating private sector adoption of APMs going in 2019-20. Large employers and purchasing coalitions are contracting directly with providers for specialty episodes and total cost of care deals.
ACO Model 2016 MSSP Results 10+ million Medicare • MD-owned Hospital $250 beneficiaries in ACO $200 models $150 $100 Success in physician- led • $50 ACOs $0 Moving ACOs out of track 1 • -$50 -$100 in 2019 -$150 Can this model be used • -$200 more broadly in Savings vs. Benchmark Additional Savings ACO Payments Net Benefit/Loss to Medicare healthcare?
What about specialists? Primary care spend estimated at • 10% of total healthcare spend High pricing is the driver behind • high costs- and specialists are in the driver’s seat CMS establishing Value- based • programs for specialists These programs focus on • team- care & cost containment of an area within specialists’ control CMS: Chronic Conditions Among Beneficiaries BPCIA • ESCOs •
Emerging Opportunities for Specialists MEDICARE BPCIA 29 inpatient / 3 outpatient procedure Spotlight on Texas • bundles 1,500 BPCIA bundles approved • Savings opportunity focused on post- • acute care re-design and efficiency Participants • Qualified APM at 20% upside / • All major hospitals (UT led with 150+ • downside risk bundles) End Stage Renal “ESCO” Most regional medical centers • ESRD ‘ACO’ • Independent groups at less than 5% • $51,000,000+ in shared savings • Oncology OCM Convening organizations include: • Commercial payers invited to • Fusion5, Encompass, Remedy participate Partners and UnitedHealthcare COMMERCIAL Currently limited to procedures such as colonoscopy and ortho. Most programs lack scalability and very few organizations are tackling chronic conditions
Challenges with Current Models MEDICARE 90 days ‘all in’ • Focused on procedures • Site of service opportunities neutralized • Participation requires a convener • Access to capital for risk • COMMERCIAL Very limited opportunities, focused on procedures • Challenges with data sharing • Upside only • Undecided on which program to adopt •
Our Proposal Follows the principal of shifting • payment from volume to value Synergy with existing ACO models • For specialists, VBC will carve out • episodes- both procedures and chronic conditions- to manage Continue to align incentives • across the care continuum
Specialist Contract Methodologies PROCEDURE EPISODES CONDITION EPISODES Objectives Objectives • Surgical quality & efficiency • Clinical quality & efficiency • Managing pre/post procedure outcomes • Early intervention and disease • Identifying efficient provider partners management • Lowering procedure cost • Coordination / Transitions of Care • Patient experience Examples • Patient Education Colonoscopy, Joint Replacement, Coronary Bypass Examples Cost Levers Heart Failure, Diabetes, COPD, CKD ▪ Unplanned event mitigation ▪ Site-of-service Cost Levers ▪ In-patient utilization ▪ Care coordination with PCPs ▪ In-network specialists ▪ Patient compliance ▪ Tools and techniques ▪ ER utilization ▪ Standards of care Immediate Opportunity Opportunities abound to lower costs by shifting site Immediate Opportunity of service, reevaluating ancillary provider partners, Given the right data, specialists will be able and changing clinical workflow patterns. to squeeze out unnecessary utilization of the healthcare system.
Case Study: Colonoscopy Benchmark established by market average
Case Study: Colonoscopy Identify cost buckets within a procedure 1
Case Study: Colonoscopy Break down bucket 1: average pathology costs 2
Case Study: Colonoscopy Break down bucket 2: average anesthesia costs 3 $1,900 $323
Case Study: Colonoscopy Break down bucket 3: average facility fees 4
Case Study: Colonoscopy Understand each individual physician’s provider mix for actionable conversations 5
Why does this 378 x $662 = matter for Value Based Care? $250,236 This data set contained 378 scopes, • with anesthesia costs of $250,000 378 patients x $323 = Average anesthesia cost per scope • is $662, mostly with MDs $122,094 Average CRNA cost per scope is • $323 This analysis can help practices • choose efficient provider partners, $128,142 helping the practice win in Value Based Care models in potential episode savings
ACO has $10,000 to manage this patient’s total cost of care Colonoscopy Episode An aligned specialist is beating the Houston benchmark ($2,743*) by $1,000 *Guroo
Cost Data and Physician Performance ▪ A recent study from the Deloitte Center for Health Solutions found that access to cost information may drive more behavior change toward value-based care among physicians. ▪ The study also found that two-thirds of physicians have access to their own productivity and quality performance data, but cost information is less common. Which of the following types of performance information would compel you to reconsider how you practice? For each of the types of information you receive, can you recall an instance when the information made you reconsider or change how you practice? Not Implemented Implemented My own performance on quality measures 65% 71% My own productivity measures 51% 57% Estimated patient out-of-pocket costs for 39% 62% different treatment options Cost or resource use for attributed patients 36% 53% Performance on quality measures for 32% 59% physicians/ facilities to which I refer Cost or resource use of physicians/ facilities to 23% 60% which I refer None of the above 26% N/A Source: Deloitte 2018 Survey of US Physicians
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