Creating new value in healthcare

Global themes for a global conference

Dr Mark Britnell Chairman and Partner KPMG’s Global Health Practice

@markbritnell

1 © 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved.

Member of the World Economic Forum Global Agenda Council 60 countries, 170+ occasions.

How much change do you expect in the shape of the provider system and their business models in the next 5 years?

Source: KPMG pre-conference surveys: Rome 2012 and London 2014

3%

16%

53%

13%16%

11%

19%

30%

37%

4%

0%

10%

20%

30%

40%

50%

60%

Extremely sustainable

Very sustainable

Somewhat sustainable

Not very sustainable

Not at all sustainable

37%

61%

3%0%0%

52%

41%

4%0%

4%

0%

10%

20%

30%

40%

50%

60%

70%

Major changes

Moderate changes

Minor change

No signif icant

change

Not sure

Rome 2012

London 2014

“The current business models operated by hospitals in my system are...”

72% think existing hospital business models are sustainable but 98% expect moderate or major change to their health systems

Do they believe change starts with someone else?

#1 Organisations and health systems are not aligned for sustainable transformation

What is the scale of change required in the healthcare sector in your country?

Sources: KPMG What Works Healthcare Insights global crowd sourcing community

35%

36%

16%

6%

6%

0% 20% 40% 60% 80%

Fundamental

Moderate

Incremental

Very little

No change isrequired

73%

19%

7%

1%

1%

0% 20% 40% 60% 80%

Our crowd sourcing community revealed a major disconnect between their organisation and health system

Twice as many thought the wider system required fundamental change

What is the scale of change required in your organisation?

#1 Organisations and health systems are not aligned for sustainable transformation

While most strategic effort is focused on transactional – not transformative – changes, integration is much more prominent.

Source: KPMG pre-conference surveys: Rome 2012 and London 2014

85% 81%74%

44%56% 52%

44%

30%22%

30%

81% 78%85% 85%

74%

50% 52%41%

56%63%

33%

19%

93%85%

0%10%20%30%40%50%60%70%80%90%

100%

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Dev

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Ver

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'#1 Organisations and health systems are not aligned for sustainable

transformation

Which strategies are providers likely to adopt to respond to these changes?

"My health system is planning to redesign care within the next 5 years to create more integrated delivery"

Sources: KPMG Global Healthcare Conference 2014, pre-conference survey

0%

7%11%

52%

30%

0%

10%

20%

30%

40%

50%

60%

Strongly disagree

Disagree Neither agree nor disagree

Agree Strongly agree

#2 People believe that integration is critical for improved health system sustainability

82% of global respondents believed their health system will become more integrated over the next 5 years

"Fragmented patient pathways – within my organisation and across my health system – compromise clinical effectiveness and operational efficiency"

80% of global respondents agreed that fragmented care hampered clinical effectiveness and operational efficiency


0% 0%

19%

58%

22%

0%

10%

20%

30%

40%

50%

60%

70%

Strongly disagree




"Bringing primary and secondary care together into the same organisation does not create sufficient additional value to justify the difficulty of doing so"


15%

56%

19%

11%

0%0%

10%

20%

30%

40%

50%

60%

Strongly disagree




71% of global respondents believed that greater primary and secondary care integration was beneficial

"With the right support and empowerment patients actively managing their own care creates better value care"

#3 Patients, when empowered, will create more value

72% of global leaders believe empowered patients create better value care


0%

11%

17%

28%

44%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Strongly disagree



Source: KPMG Global Healthcare Conference 2014, pre-conference survey

How satisfied are you that your organisation is truly meeting the aspirations of your patients?

8%4%

0%

58%

31%

0%

10%

20%

30%

40%

50%

60%

70%

Strongly disagree

Disagree Neither agree nor

disagree


7%

70%

19%

4%0%

10%

20%

30%

40%

50%

60%

70%

80%

Very satisfied

Somewhat satisfied

Somewhat dissatisfied

Very dissatisfied


However, 89% of leaders believe their health systems are designed around organisations’ – not patients’ – priorities and they are not very

satisfied they are meeting patients’ needs

“The delivery of healthcare is currently structured more according to organisational structures and boundaries than the needs of the patient"

Sources: KPMG Global Healthcare Conference 2014, pre-conference survey KPMG What Works Healthcare Insights global crowd sourcing community

“In my organisation patients actively participate in managing their own care”

79% of our crowd sourcing community believed patient experience indicators are being more widely used; only 14% of global leaders thought their patients were becoming ‘active’

79%

17%

4%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Yes No Don't know

3%

29%

46%

14%

0%0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Strongly disagree



Is patient experience a key performance indicator for your organisation?


Source: KPMG-commissioned global survey of patient representative and advocacy groups

Hong Kong Alliance of Patients’ Organizations

ABCD: Associacao Brasileira de Colite Ulcerativa e Doenca de Crohn

Unique global insights from patient support and advocacy groups, representing millions of

patients across 6 countries

Crohn’s & Colitis Foundation of America

Families USA

American Cancer Society

Childbirth connection

Canadian Cancer Survivor Network

Canadian Diabetes

Association

healthexperiences.ca

Canadian Breast Cancer Network / Reseau Canadien du Cancer du Sein

ABRA SUS

Nederlandse Diabetes

Vereniging

Crohn en Colitis Ulcerosa Vereniging

Nederland

European Patients Forum National Voices

National Childbirth Trust

Macmillan Cancer Support

Hong Kong Breast Cancer

Foundation Diabetes Hong Kong

Dutch Patients & Consumers Organisation

#4 There is some distance between what patients want and what they get

Federação Brasileira de Instituições Filantrópicas de Apoio à Saúde da Mama

Source: KPMG-commissioned global survey of patient representative and advocacy groups

Our global research suggests 5 dominant themes:

“See me – and support me – as a person, not a condition or an intervention site”

1

Patients want to be informed partners in care 2 Fragmented care is harmful and wasteful care. Patients can feel “abandoned” (especially after discharge) 3

Patients want to be empowered partners in care 4

In some countries securing responsive access to care is a fundamental priority

5


"Measurements of patient experience impact on how my organisation delivers care"

Are patient experience measures used in the performance appraisal of clinical staff and managers within your organisation?

Clinical staff

Managers

Sources: KPMG What Works Healthcare Insights global crowd sourcing community

46%37%

17%

46% 42%

12%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Yes No Don't know

62%

26%

6% 5%

0%

10%

20%

30%

40%

50%

60%

70%

Strongly agree

/ Agree

Somewhat agree

Somewhat disagree

Strongly disagree

/ Disagree


While our crowd sourcing community overwhelmingly believed that patient experience is now a key performance indicator,

more needs to be done on activation and empowerment

Source: Hibbard J H, Greene J, Overton V (2013) ‘Patients with lower activation associated with higher costs; delivery systems should know their patients’ “scores”.’ Health Affairs, 32, no (2013): 216-22. (Quoted in KPMG, ‘Creating new value with patients, carers and communities’)

Many studies show that activated’ patients have better health outcomes at lower costs.

Patients with lower activation scores cost 8% to 21% more.

2010 patient activation level

Predicted per capita billed

costs ($)

Ratio of predicted costs relative to level 4 Patient

Activation Measure (PAM)

Level 1 (lowest) 966 1.21

Level 2 840 1.05

Level 3 783 0.97

Level 4 (highest) 799 1.00

#5 What Works. There is an evidence base for patients creating value

We have developed a 9-point maturity matrix to help assess

progress: 3. Systems to support shared decision making

4. Models support self-care and help professionals adapt

6. Can patients get and use information?

5. Are patients’ assets mobilized?

8. Are the assets that communities can contribute mobilized?

7. Are patients involved in teaching and research?

1. Work to create a new culture centreed on the patient culture

2. Patient input into service design

Are there measurement systems to support this? Patient experience and outcome data embedded in all performance management & governance

Patient experience and outcome data embedded in performance management of medical staff

Real time collection data used at front line for improvement

Systematic collection of data reported to boards

Recognition that the collection of data on patient experience and outcomes will provide a basis for understanding progress and analysis

No data on patient experience or outcome data collected

1

2

3

4

5 9. Are there measurement systems to support this?

0

mat

urity

leve

l

Source: KPMG, ‘Creating new value with patients, carers and communities’ 2014

1 2 3 4 5

#5 There is an evidence base for patients creating value

Source: All-Party Parliamentary Group on Global Health, ‘Patient empowerment: for better quality, more sustainable health services globally’ 2014

#5 There is an evidence base for patients creating value

#6 The activist payer is emerging and pursuing value (but has some way to go)

“I expect to see...”


93%85%

7%15%

0%10%20%30%40%50%60%70%80%90%

100%

Payment systems more bundled and focussed on value

Price reductions and capping of volumes

Agree

Disagree

Global leaders expect payment systems to become more bundled and focused on value (with downward pressure on prices)

“The pursuit of short-term cost reductions compromises clinical and operational effectiveness:”

“My negotiations with my main payer / provider are focussed (mainly) on ...”

But a majority agree that a short-term focus on costs is too transactional and not consistent with value and sustainable care

Source: KPMG Global Healthcare Conference 2014, pre-conference survey

3%

28%

17%

42%

11%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Strongly disagree



41%38%

9%13%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Immediate concernsfor financial

sustainability

Short-to-medium-termimprovements to

patient care

Long-term considerationsof higher-value

Sustainablepatient care

#6 The activist payer is emerging and pursuing value (but has some way to go)

Conclusions

Organisations and health systems are not aligned for sustainable transformation 1

People believe that integration is critical for improved health system sustainability 2

There is some distance between what patients want and what they get 4

The activist payer is emerging and pursuing value (but has some way to go) 6

There is an evidence base for patients creating value 5

Patients, when empowered, will create more value 3

Workforce is a worry. Optimism around leadership and technology. 7

Launched at Davos...

Necessity, the mother of innovation:: Low-cost, high-quality

healthcare

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© 2014 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. The KPMG name, logo and “cutting through complexity” are registered trademarks or trademarks of KPMG International. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.

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Creating new value in healthcare

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