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POPULATIONHEALTH

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identifyingimplementation tactics

The Impact of Value-Based Purchasingand Other Employee Initiatives onPopulation Health

November 20, 2014

This presentation has been provided for informational purposes only and

is not intended and should not be construed to constitute legal advice.

Please consult your attorneys in connection with any fact-specific

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POPULATION HEALTHthought leaders in

Identifying implementation tactics

Can Population Health Management Interventions Help State Medicaid Offerings?

December 18, 2014 at 12:00 p.m. ET

This session will focus on how state Medicaid programs are utilizing casemanagement and other population health management interventions toimprove clinical and financial outcomes. One major issue concerns ongoingbudgeting issues, along with how to bend the cost curve and generally “fix” theMedicaid system. The session also will touch base on how to best implementmeaningful population health programs where federal, state and local agenciesoften need to fund, pay for and coordinate care together.

Keep an eye out for the webinar invitation!

Upcoming Webinar!

3



David Lansky, PhD

President & CEO

Pacific Business Group on Health

Laurel Pickering, MPH

President & CEO

Northeast Business Group on Health

Adam Solander - Moderator

Associate

Epstein Becker Green

Webinar Presenters

4



This session will explore the activities of some well-known employer coalitionsand discuss how they are designing and implementing value-based purchasinginitiatives. Speakers will include an update on consumer-directed health,accountable care organizations (ACOs) and care management and wellnessprograms.

The webinar will focus on:

– Standardizing and reporting on performance measures

– Identifying the next wave in value-based purchasing

– Assessing the impact of the ACA and other health reform initiatives onemployers

– Engaging consumers in informed decision making

– Approaches to reduce costs and improve health care

Presentation Overview

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The Pacific Business Group on Health (PBGH), a not for profit 501(c)(3), has ledefforts to transform health care using the combined influence of some of thelargest purchasers of health care services in the United States.

Pacific Business Group on Health

©PBGH 2014

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PBGH Members

©PBGH 2014

7

AppleFacebookGoogleHewlett PackardMicrosoftOracle….



57%

119%

182%

56%

117%

196%

14%

34%

50%

11%

29%40%

0%

50%

100%

150%

200%

250%

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

Health Insurance Premiums

Workers' Contribution to Premiums

Workers' Earnings

Overall Inflation

SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2013. Bureau of Labor Statistics, Consumer Price Index,U.S. City Average of Annual Inflation (April to April), 1999-2013; Bureau of Labor Statistics, Seasonally Adjusted Data from theCurrent Employment Statistics Survey, 1999-2013 (April to April).

$16,351*

$15,745*

$15,073*

$13,770*

$13,375*

$12,680*

$12,106*

$11,480*

$10,880*

$9,950*

$9,068*

$8,003*

$7,061*

$6,438*

$5,791

$5,884*

$5,615*

$5,429*

$5,049*

$4,824

$4,704*

$4,479*

$4,242*

$4,024*

$3,695*

$3,383*

$3,083*

$2,689*

$2,471*

$2,196

$0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999 Single Coverage

Family Coverage

Cumulative Increases in Health Insurance Premiums, Workers’Contributions, Inflation, and Workers’ Earnings, 1999-2013

©PBGH 2014



Employers Considering “Exit”

Source: 19th Annual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in HealthCare (2014)

©PBGH 2014

9



1990s: Health plans and managed care

2000s: Skin in the game, account-based plans

2010s: Direct engagement with providers

High performing employers today:

– Strategies to alter provider payment

– Strategies to alter consumer decisions (“steerage”)

The Evolving Purchaser Strategy

©PBGH 2014

10



Three case studies (all from orthopedics):

1. Reference pricing

2. Centers of Excellence: Travel Surgery

3. Joint Replacement Registry: Patient Reported Outcomes

One case study of purchaser-driven ACO (from the city of San Francisco)

Purchasers’ Approach to “Episodes” and ACOs

©PBGH 2014

11



Price varies from $15,000 to $110,000 (commercial PPO population)

Anthem Blue Cross and CalPERS established a threshold of $30,000–referenceprice–for standard inpatient hip/knee replacement procedure

Increased volume of products at low-cost hospitals by 21%

Amount paid per surgery 20% lower across all cases

CalPERS: Applying Reference Pricing toHip/Knee Replacements

©PBGH 2014

Source: Robinson JC and Brown TT, “Increases in Consumer Cost Sharing Redirect Patient Volumesand Reduce Hospital Prices for Orthopedic Surgery.” Health Affairs 32(8), 2013, pp. 1392-1397.

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Reference Pricing: Orthopedics

©PBGH 2014

Source: Robinson JC and Brown TT, “Increases in Consumer Cost Sharing Redirect Patient Volumes andReduce Hospital Prices for Orthopedic Surgery.” Health Affairs 32(8), 2013, pp. 1392-1397.

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What is ECEN?

– Founding Purchasers (launched early 2014)

Employers Centers of Excellence Network(ECEN)

©PBGH 2014

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Episode-based fees:

– Developed in partnership with providers

– Promotes coordination across services

– Encourages fair and competitive prices

– Single rate for “wheels up to wheels down”

ECEN: Bundled Payments

©PBGH 2014

15



Higher quality care

Supportive, seamless and integrated experience

Exceptional, patient-centered care

Lower out-of-pocket costs

Program Value for Employees

©PBGH 2014

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High employee satisfaction

Cost predictability

Downstream savings

Return on investment within 2 years

Program Value for Employers

©PBGH 2014

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Overview of COE Evaluation Criteria

©PBGH 2014

Employer Needs

Location

Bundled paymentdesign

Travel surgeryexperience

Reporting on COEperformance

Patient Experience

Shared decisionmaking

Supportiveresources

Attention to patientexperience acrossthe complete carecontinuum

Quality of Care

Outcomes data andrankings

Volume, trainingand experience

Patient safety andsatisfaction scores

Application ofevidence-basedmedicine

18



Virginia Mason Medical Center

Seattle, WA

Kaiser Permanente Irvine

Medical Center

Irvine, CA

Mercy Hospital, Springfield

Springfield, MO

Johns Hopkins Bayview

Medical Center

Baltimore, MD

COE Locations

©PBGH 2014

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1,636 inquiries

348 surgeries performed

….? inappropriate referrals

Initial ResponseECEN 1/1/2014-9/30/2014

©PBGH 2014

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Identifying implementation tactics21



California Joint Replacement Registry: Notjust a device registry

©PBGH 2014

DEMOGRAPHICS

DEVICEINFORMATION

PROCEDUREINFORMATION

COMORBIDITIES

PROPHYLAXIS

READMISSIONS

PATIENT REPORTEDOUTCOMES

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Patient Reported Outcomes

©PBGH 2014

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1. Bundled payment for standardized episode

2. “Accountability” for outcomes (TBD)

3. Coordination with local referring and follow-up providers

4. Transparency on quality and cost; comprehensive quality dashboard

5. Commitment to continuous improvement collaboration

6. Participation in recognized, standardized registry with public reporting

7. Commitment to patient engagement, including shared decision making,patient reported outcomes and patient experience feedback

Key Elements of Ortho Network for LargePurchasers: Favorable Benefit Design

©PBGH 2014

26



Split between consumerist andintegrated care visions

Diversity of purchaser needs,beliefs and resources

Unusual adaptations byproviders and plans (e.g., Kaiserparticipation in Centers ofExcellence orthopedic network)

Are We All on the Road to ACOs? No!

©PBGH 2014

Survey source: 19th Annual Towers Watson/National Business Group on HealthEmployer Survey on Purchasing Value in Health Care, 2014.

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Purchaser Strategies: Build or Buy?

©PBGH 2014

Build Your Own Buy from a Health Plan

Pros Pros

• Control provider network selection • Less start-up time

• Control design elements, includingcare management, quality metricsand payment model

• Leverage established managementinfrastructure and reporting

• Design for target market • Benchmark within a broadernetwork

Cons Cons

• Resource intensity (for theemployer)

• Limited ability to customize designand payment model

• Stability and sustainability • Limited network customization

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Few ACOs can deliver on cost and quality today

Purchasers’ role is to raise the bar and simplify the performance requirements

Keep the focus on these principles:

– ACOs must be transparent

– ACOs must be outcomes-focused

– ACOs must be patient-centered

– ACOs must pay providers for quality, not quantity

– ACOs must address affordability and contain costs

– ACOs must support a competitive marketplace

– ACOs must demonstrate meaningful use of health information technology

Desired results will require intense collaboration, leadership and perseverance

Commit to multi-year transition to global payment and provider full risk for apopulation

Current State of Large Purchaser Thinking

©PBGH 2014

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Collaboration between PBGH and Catalyst for Payment Reform

Model ACO Contract Language

– Purchaser expectations: aligned with principles

Performance metrics

User guide

– Sample financing/risk-sharing models

– Purchaser checklist and illustrative implementation timeline

Health plan questionnaire

Provider request for information

Case studies

ACO Toolkit Elements

©PBGH 2014

Available at: www.catalyzepaymentreform.org/?option=com_content&view=article&id=122

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http://www.catalyzepaymentreform.org/?option=com_content&view=article&id=122



The Health Service System isdedicated to preserving andimproving sustainable, qualityhealth benefits and toenhancing the well-being ofemployees, retirees and theirfamilies

Programs cover 109,000 livesfor 4 employers (actives andretirees)

3 health plans: 2 HMOs and 1PPO

Also offer dental, vision, life,LTD and EAP

Health Service SystemCity and County of San Francisco

©PBGH 2014August 6, 2014

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©PBGH 2014

32



CCSF ACOs: Sustaining Results

©PBGH 2014

ID Key Indicator Baseline 2013 Results % Change Direction

1. Admits/1000 52.2 53.0 1.4%

2.30 Day ReadmissionRate

8.5% 7.5% (-13.4%)

3. Days/1000 238.0 223.2 (-6.7%)

4. ALOS 4.56 4.21 (-8.2%)

5. ER Visits/1000 171.6 160.0 (-7.2%)

Membership1: 23,512 Average Risk Score2: 1.592 (Bay Area HMO: 1.47)

1. Membership as of December 20132. Risk Score is concurrent expenditure risk calculated using DxCG Version 3.03 as of December 20133. “Baseline" reflects July 1, 2010 through June 30, 20114. “2013 Results” reflects January 1, 2013 through December 1, 2013

33



Program Framework and Timeline

©PBGH 2014

Evaluate population/healthprofile

Establish financial &utilization targets

Establish governancestructure

Identify interventions

Design and buildexecution plans

Address short-term datashare requirements

Define process andoutcome measures

Evaluate and addressprogram barriers

Coordinated execution

Monitor process andoutcome measures

Refine, improve and expand

Increase physicianeducation & memberengagement opportunities

Design complex, moretransformationalinterventions

Add new

interventions

Evaluate long-term

transformational care

strategies

Address long-term

data share

opportunities

Refine, improve and

expand

Program evaluation

partnership launch &evaluation

low/medium complexity intervention execution;‘getting the basics right’

higher complexity; transformationalchange

multi-year partnership: maturity timeline

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Shared interest in disruption, and accelerated adoption of new payment anddelivery models

Focused on “raising the bar” on performance

Interested in direct relationship with aligned provider systems

Recognized need for multiple, aligned interventions: payment, benefit design,transparency on outcomes and clinical improvement

Invested substantial resources in testing, spreading and scaling innovation

Conclusions About Large Employers

©PBGH 2014

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Northeast Business Group on Health is a network of employers, providers,insurers and other organizations working together to improve the quality andreduce the cost of health care in New York, New Jersey, Connecticut andMassachusetts

Our mission is to empower our members to drive excellence in health andachieve the highest value in health care delivery and the consumer experience

Northeast Business Group on Health

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NEBGH Employer Members

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How does NEBGH empower our members?

How does NEBGH use that power to drive excellence in health and achieve thehighest value in health care delivery and the consumer experience?

NEBGH: Member Empowerment

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Health Plans

– eValue8

– User Groups

• Aetna, United, Anthem and PBM

Education

– Topics: Employers working directly with providers, private exchanges,specialty pharmacies, health care innovators/disruptors, the ROI ofwellness programs, retail clinics, etc.

Empowering Employers

39



Evidenced-based health plan evaluation process

How does the plan use the information and contracts it has to improve thehealth of the member and the delivery system?

Sponsored by National Business Coalition on Health

NEBGH has participation from Aetna, Cigna, United and Anthem

eValue8

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Health plans complete request for information (RFI)

Results are scored

Detailed feedback is provided to plans and employers

Comparative health plan reports are developed for plans and employers

Meeting is scheduled with employers and plan leadership to review results

eValue8 Process

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0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Cigna NJ UHC NJ Aetna NY Anthem NY Cigna NY UHC NY PPOBenchmark

PossiblePoints

17% 17%

5% 7%17% 17% 17%

21%

18% 15%

17% 13%

18% 15% 18%

20%

30%30%

34%

26%

30%30%

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10%10%

11%

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10%10%

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2%3%

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77% 75%

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76% 78%82%

100%

Pe

rce

nt

of

Po

ssib

leP

oin

ts

Plan Design Capabilities Provider Information Treatment Option Support & PHR Price Transparency Performance Measures

2013 eValue8 ResultsConsumer Engagement

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0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Cigna NJ UHC NJ Aetna NY Anthem NY Cigna NY UHC NY PPOBenchmark

PossiblePoints

25% 29% 29%21% 25% 29% 25%

32%

11%10%

4%10%

11%10%

11%

12%

15% 9%

5% 8%

10% 7% 17%

20%

22%

9%

14%6%

13% 12%

30%

32%3%

2%3%

2%

2% 3%

2%

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76.8%

59.0%55.1%

46.7%

61.3% 60.7%

84.5%

100.0%

Pe

rce

nta

geo

fP

oss

ible

Po

ints

Coordination/Member Support Practitioner Support CAD Performance Diabetes Performance Other Conditions

2013 eValue8 ResultsChronic Disease Management

43



NEBGH serves as a neutral convener and catalyst for plans and other health carestakeholders

Multi-payer collaboration is key

Driving Value in Health Care Delivery

44



80% of anti-depressant prescriptions written by PCPs

PCPs need support (lack of knowledge, lack of referral base, etc.)

Proven model: “Collaborative Care Model”

Link a care manager and consulting psychiatrist

Need a multi-payer reimbursement strategy

Integrating Behavioral Health into PrimaryCare

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Multi-payer strategy to integrate behavioral health into primary care

Aetna, Cigna, United Healthcare, Anthem and Emblem

Four primary care practices

Focus on paying for activities plans that patients don’t normally pay for

NEBGH One Voice Project

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Multi-payer: Aetna, Cigna, United, Anthem and Emblem

One hospital system: NYU Langone Medical Center

How can we further reduce NYU’s readmissions?

Focus on increasing use of risk scores and coordinating care

Hospital Readmission Reduction Project

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NEBGH Solutions Center

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Questions

49



Can Population Health Management Interventions Help State Medicaid Offerings?

December 18, 2014 at 12:00 p.m. ET

This session will focus on how state Medicaid programs are utilizing casemanagement and other population health management interventions toimprove clinical and financial outcomes. One major issue concerns ongoingbudgeting issues, along with how to bend the cost curve and generally “fix” theMedicaid system. The session also will touch base on how to best implementmeaningful population health programs where federal, state and local agenciesoften need to fund, pay for and coordinate care together.

Keep an eye out for the webinar invitation!

Upcoming Webinar!

50

POPULATIONHEALTH

thought leaders in


Adam SolanderEpstein Becker [email protected](202) 861-0900

David Lansky, PhDPresident & CEOPacific Business Group on Health

1227 25th Street, NWWashington, DC 20037www.ebglaw.com

Laurel Pickering, MPHPresident & CEONortheast Business Group on Health

POPULATIONHEALTH

thought leaders in


THANK YOU

www.ebglaw.comwww.ebgadvisors.com

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