London Health and Care Leaders Forum - PowerPoint Presentation

Slide1

London Health and Care Leaders Forum

11th

March 2014Payment Innovation Break-out

1

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There are 3 major complementary payment models being deployed in US2

Full alignment of payment to outcomes

Most

applicable for:

Episode-based payment

Retrospective Episode Based Payment (

REBP

)

Bundled payment

Pay

for

value

Bonus payments tied to quality

Bonus payment tied to

value

Population-based payment

Capitation

Care for people with long term condition (e.g., managing diabetes,

CHF

) and elderly

Primary

prevention for healthy

Acute procedures (e.g., CABG, hips, perinatal)Most inpatient stays including post-acute care, readmissionsAcute outpatient care (e.g., broken arm, URI, some cancers, some behavior health)

Discrete services provided by entity with limited influence on upstream or downstream costs (e.g., MRI, prescription, medical device, Health Risk Assessment)

Slide3

These models deliver significant net savings3

3-22% range

7-10% most

С

ost

savings as %

Slide4

Speakers4

Dr.

Philip

Ozuah

John

Wardell

Ric

Marshall

Slide5

Payment InnovationPhilip O. Ozuah, MD, PhD

Chief Operating OfficerMontefiore Health System

Slide6

National Health Expenditures Per Capita

1980-2007

Slide7

Health

Expenditures as

% of GDP

Slide8

Byzantine Medicare Inpatient

Payment

Hospital Adjusted

Operating & Capital Base Payment

Rate

2009

Operating & Capital Base Payment Rate

2008

Update

Wage Index

MS-DRG Weight

(Medical Severity Adjusted* Diagnosis Related Group weight **)

Hospital AdjustedBase Payment Rate2009

* Principal Diagnosis, Procedure,

Complications & co-morbidities

** 745 individual DRG weights

Direct (pass-through) & Indirect Medical (Interns, Residents/bed) Education Pmt.Disproportionate Share Payments (if Medicaid & SSI Pt Days >15% of total)

Other Policy Payments

(Critical Access Hospital>35 mi, Medicare-dependent>60%)

Outlier Payments (Est. Cost > Loss Threshold)Reduction for Early Transfer (LOS <mean LOS-1)

Reduction if Quality Indicators not ProvidedPAYMENT RATE FOR AN INDIVIDUALPATIENT’SADMISSION

Mean

‘

08 Payment

$9,278 all hospitals

$13,499 large teaching

$6,026 small rural

Copyright 2008, J.B. Silvers,

Weatherhead

School of Management. Case Western University

Slide9

Complicated Medicare Physician

Payment

Limitation

Adjusted for geographical cost factors

Conversion Factor

2009

Conversion Factor

2008

Update

Relative Value Units (RVU)*

-work

-practice expense

-malpractice expensePhysician Payment Rates by procedure

2009

* Determined for 10,000 procedures

as defined by Healthcare Common Procedure Coding System (HCPCS)

UPDATE ADJUSTMENT FACTOR (UAF)

SUSTAINABLE GROWTH RATE (SGR)

Growth rate that reflects inflation, enrollment,

real GDP per capita and policy changes

Change required to recoup (or pay extra) the cumulative difference between actual changesand max allowable under SGR (=< 7%)Copyright 2008, J.B. Silvers, Weatherhead School of Management. Case Western University

Slide10

Cost Shifting Approach

To Financial Sustainability

*Source:

http://

publications.milliman.com/research/health-rr/pdfs/hospital-physician-cost-shift-RR12-01-08.pdf

, shows hospital operating margins by payer from 2006, based upon American Hospital Association survey data

Hospital Operating Margins by Payer*

3.8% overall margin

Cross-subsidization

Slide11

Alternative to Cost Shifting

Focus on efficiency and rooting out waste to improve operating margins

Slide12

The challenge

Traditional

Fee-for-Service

Pay-for-

Performance

Bundled

Payments

Shared

Savings

Partial

Risk

Full

Risk

Episodic Cost Accountability

Total Cost Accountability

Minimal

Substantial

Savings Potential for Health Plans and Customers

Source: The Advisory Board Company: Accountable Care Forum-Briefing for Health Plan Executives

Slide13

Montefiore

’

s

model

is evolving…

From

To

Fee-for-service

Risk

&

shared savings

One market

Multiple markets

Scale

for volume

Scale

for covered lives

Centralized

Networked

Owned

entities

Partnerships

More employed MDs

More voluntary

MDs

Evolving model…

Slide14

This is payment and delivery system reform

Slide15

London Health and Care Leaders Forum

14th March

2014John WardellDeputy Chief

Officer

Tower Hamlets Clinical Commissioning Group

15

Slide16

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Tower Hamlets before networks

8 Networks

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were formed in the borough during 2009

Why networks?

Focus on

population health

across a geography

Collaborative relationships with

wide range of partners

(e.g. Borough, schools, charities)

Sufficient

scale for specialisation

of staff, ability to access rare skills and ensure access, resources (e.g. equipment)Integration with estates plan

Understanding the development of federated networks

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Pop:

29,892

Pop: 18,027

Pop: 29,801

Pop: 35,720

Pop: 28,995

Pop: 33,186

Pop: 27,839

Pop: 31,975

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8

LAPs

36

practices

Total population of ~

245,000

Practice list sizes of 3,000 to 11,000

Slide17

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Case for change…

Wide variation in clinical practice and outcomes for diabetes patients

Economies of scale

Poor uptake of diabetes education and retinal screening

Need to do things differently

The right people to do the right tasks at the right time

Specialist support

Transparency of data

Putting the patient at the

centre

of their

care

Slide18

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How did it work…

Care packages are:

Networks:

Focus on population health across a defined area

Have collaborative relationships with a wide range of partners (e.g. Borough, Schools, Charities)

Provide sufficient scale for:

Specialisation

of staff

Ability to access rare skills

Resources (e.g. equipment)

Ability to ensure access

Integrate with estates plan

Organisational development

Information and

technology

What supports it all?

Payment Model

Contracted at network level 70% upfront and 30% on performance

Reducing variability through the use of evidence based pathways

Ensuring the right people to do the right tasks at the right time

Enabling transparency of data at individual patient, clinician, practice, and network level

Facilitating an integrated and coherent approachCosting of care packages

Slide19

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Outcomes

Slide20

Improving MMR vaccination rates: herd immunity is a realistic goal.

Cockman

P, Dawson L, Mathur R, Hull S, BMJ2011;343doi: 10.1136/bmj.d5703

MMR

Immunisation

2006-10

Maintaining

MMR

improvement

20

Slide21

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Good clinical leadership and engagement of specialists

Emphasis on quality of care and outcomes for patients

Contracting and paying for outcomes

Organisational

development

IT and information sharing

Presentation of the right data regularly

Geographical network boundaries (not based on historical practice relationships with one another)

Critical success factors

Slide22

Behaviour

change

Guideline

Education

Incentives

Comparative

Feedback

Practice

networks

Belief

Act

Motivate

Organisation change

IT

Equity

audit

IT

Dash-

board

IT

Review

&

recall

IT

Prompts &

Decision

support

22

Slide23

23

Integration Going Forward

Slide24

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Forward Plan

2015/16 and 16/17 shadow

capitation

2014/15 and 15/16 local provider consortia

Current state and

14/15

2016/17

fully capitated

Enablers for end state

Payor

/provider configuration

Local

CCGs

provider consortia for all IC services

Local

CCGs

provider consortia for all IC services

Local

CCGs

provider consortia for all IC services

Local

CCGs

provider consortia for all IC services

Reimbursement model

Capitated model

Pay for performance model

Pay for performance model

Pay for performance model

Service configuration

Services contracted through consortia

Services contracted through consortia

Services contracted through consortia

Services contracted

individually

Health and social care

Pooled social and health funding

Joint working agreed

Joint working agreed

Separate social and health funding

Outcome linked reward/risk

Provides

control/share

full risk

for activity

and

outcomes

Providers share more risk for activity and outcomes

Providers share more risk for activity and outcomes

Commissioners bear risk for activity and outcomes

Might need to break

PbR

for target population

Indicative individual budgets with shadow capitation model

Indicative individual budgets

Agreement on reimbursement models to be implemented

Slide25

25

What are we commissioning for integrated care

WELC

will provide nine key

interventions

for its population underpinned by

five components

and enablers

Health and social care

navigation

Self-care,

behaviour

,

and expectation management

Care planning

Specialist

input In the

community

Discharge support from

acute to

community

Discharge support formental health patients fromsecondary to primary careRapid response with shortteam reablement

Mental health liaison (RAID)Areas of interventions

Essential components

Information sharing platform

Evidence-based pathways &

care packages

(e.g. last years of

life, diabetes

,

COPD

,

CHD

.

falls,alcohol

and substance misuse)

Joint health & social care

assessment

Creation of new roles within

the workforce:

Case

manager

Hybrid

health & social worker

Health &

social care coordinator

Discharge

coordinator based

in acute

wards

Organisation

of practices

into networks

Enablers

Patient engagement

Joint decision making

and accountability

Clinical leadership and

culture development

Information sharing and

decision support

Aligned incentives and

reimbursement models

Care coordination

Ensuring people are in the most appropriate setting of care

Self-care

Joint health, social care and mental health approach

Case management

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26

Contracting approach – Standard

NHS

Contracts

CCG

Mental Health Liasion (RAID)

Discharge Management

Rapid response

Social services

Care Co-ordination

Integration function delivered collectively by all providers in collaboration

Generic schedule

for

all

Provider specific schedules

Provider specific schedules

Slide27

Provider assurance process

Indicative summary provider development approach to commissioning integrated care services

Prospectus

Brings key documents together

Adds detail to provider letter

Signals what might be in future phases

Payment mechanism

Sets out approach to payment on outcomes

Outlines incentives for providers to work together to provide integration of services

Provider letter

Lists for each provider the services we anticipate they will provide in 14/15

Signals 70/30 split for 14/15

Outlines next steps (below comes from

CCG

)

KPIs

Sets out individual services and system side performance measures

SEP

+

+

+

6-9 month procurement process

Stage 1 assessment

Individual providers outline how they will provide services against the borough integrated care services specifications

Also asked about how they will integrate with others

OCT

Stage 2 assessment

Providers given feedback to Stage 1

Providers asked jointly to outline how they will ensure services are integrated

Asked if they are revising responses to Stage 1 in the light of and feedback or work done with other providers to date

NOV-JAN

Provider collaborative interview

Providers given feedback to Stage 2 and questions to answer at interview

Presentation and interview on collaboration governance arrangements and plans to deliver jointly on

KPIs

JAN

Evaluation

Further dialogue with providers about plans and clarification of details

FEB

Formal tender process

Likely to be competitive dialogue

Likely to be 6-9 months

MAR

Not approved

Contracting process

Service specification and integration written into existing contracts with providers

Payment on outcomes 14/15

Approved

Dashboard

27

Monitoring

Development of 15/16 contract begins for similar process to start in Sept 2014

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Questions?28

Slide29

London Health and Care Leaders Forum

14th March

2014Ric MarshallDirector of Pricing

Monitor

29

Slide30

Contents30

The Health & Social Care Act 2012

What next for 2014?

Slide31

The Health & Social Care Act 2012 sets out the approach for pricing and the

roles

for NHS England and Monitor

Slide32

What next for 2014?32

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Thank you…..Any questions please?Further information:

http://www.monitor-nhsft.gov.uk/sites/default/files/publications/MakingThePaymentSystemDoMore%20-%

2028Feb.pdf