June 2013 Webinar Learning Session Presentation Slides by Healthcare Collaborative of Greater Columbus

Webinar Learning Session State Innovation Models Initiative (SIM) , Center for Medicare and Medicaid Innovation (CMMI) June 20, 2013 Host: Jeff Biehl, president of Access HealthColumbus, co-chair of Ohio Patient-Centered Primary Care Collaborative, member of Governorâ&#x20AC;&#x2122;s Advisory Council on Health Care Payment Innovation Welcome!

Access HealthColumbus is a public-private partnership supported by the following organizations and individuals! Lead Support

Major Support

Additional Support 100% Access HealthColumbus Board & Staff

Individual & Corporate Donations

www.accesshealthcolumbus.org

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

• Webinar Purpose: to objectively explore recent studies and promising best practices on improving the value of health care • 1st Webinar Series focused on payment reform.. an enabler of health care transformation

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April: Report of the National Commission on Physician Payment Reform

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May: The National Scorecard and Compendium on Payment Reform, Catalyst for Payment Reform

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June 20: State Innovation Models Initiative (SIM) , Center for Medicare and Medicaid Innovation (CMMI)

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

WHO?

• The Innovation Center was established by section 1115A of the Social Security Act (as added by section 3021 of the Affordable Care Act). • The Innovation Center is a component of the Centers of Medicare & Medicaid Services, an Agency of the U.S. Department of Health & Human Services.

Source: www.innovation.cms.gov

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

WHY? • Congress created the Innovation Center for the purpose of testing “innovative payment and service delivery models to reduce program expenditures …while preserving or enhancing the quality of care” for those individuals who receive Medicare, Medicaid, or Children’s Health Insurance Program (CHIP) benefits. • Innovation Center is currently focused on the following priorities: a) Testing new payment and service delivery models b) Evaluating results and advancing best practices c) Engaging a broad range of stakeholders to develop additional models for testing Source: www.innovation.cms.gov

WHY?

PROBLEM: Payment drives volume VISION: Payment drives value LEADERSHIP: Payment innovation in Ohio

Payment Drives Volume

WHY?

Costs are unsustainable • Absolute expenditures – $2.8 trillion in 2012* • Overwhelming wage gains – 76% increase health costs in past 10 years vs. 30% gain in personal income • Growing faster than the economy – from 5% of gross domestic product (GDP) in 1960 to 18% in 2012 and 20% by 2021* • If prices of other products had grown as fast as health care since World War II —Dozen eggs: $55 —Gallon of milk: $48 —Dozen oranges: $134 Source: Institute of Medicine, Best Care at Lower Cost: The Path to Continuously Learning Health Care in America (September 2012) and (*) updated using CMS National Health Expenditure Projections 2011-2021 (April 2012).

WHY?

Payment Drives Volume

Much health spending is wasted Wasted health care expenditures totaled $750 billion in 2009, 29% of $2.6 trillion total health spending

Unnecessary Services, $210 billion

Inefficiently Delivered Services, $130 billion Prices That Are Too High, $105 billion

Missed Prevention Opportunities, $55 billion Fraud, $75 billion

Excess Administrative Costs, $190 billion

Source: Institute of Medicine, Best Care at Lower Cost: The Path to Continuously Learning Health Care in America (September 2012).

Payment Drives Volume

WHY?

Facing the Evidence on Quality • Not safe – Between one-fifth and one-third of hospital patients are harmed during their stay and much of that harm is preventable (IOM 2012)

• Not timely – The U.S. ranks last among 19 industrial nations related to

preventable deaths with timely and effective care (Commonwealth 2008)

• Not effective – Americans receive only 55% of recommended treatments

for preventive care, acute care, and chronic care management (NEJM 2003)

• Not efficient – Nearly 30% of all health care spending is wasted, much of it on unnecessary or inefficiently delivered services (IOM 2009)

• Not patient-centered – Half of all Americans feel their doctor does not spend enough time with them (Commonwealth 2005)

• Not equitable – racial and ethnic minorities receive care that often is of lower quality compared to the care received by whites (NEJM 2004)

Payment Drives Volume

WHY?

In fee-for-service, we get what we pay for • More volume – to the extent fee-for-service payments exceed costs of additional services, they encourage providers to deliver more services and more expensive services • More fragmentation – paying separate fees for each individual service to different providers perpetuates uncoordinated care • More variation – separate fees also accommodate wide variation in treatment patterns for patients with the same condition – variations that are not evidence-based • No assurance of quality – fees are typically the same regardless of the quality of care, and in some cases (e.g., avoidable hospital readmissions) total payments are greater for lower-quality care Source: UnitedHealth, Farewell to Fee-for-Service: a real world strategy for health care payment reform (December 2012)

WHY?

$10,000

Health Care Spending per Capita by State (2011) in order of resident health outcomes (2009)

Ohioans spend more per person on health care than residents in all but 17 states

$9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

MN HI CT UT CA MA IA VT WI ND CO ID WA NH NE WY NY OR NJ RI AZ TX ME MD MT FL AK VA NM SD KS IL PA DE MI IN GA NV NC MO OH SC OK KY LA AL AR TN WV MS

36 states have a healthier workforce than Ohio Sources: CMS Health Expenditures by State of Residence (2011); The Commonwealth Fund, Aiming Higher: Results from a State Scorecard on Health System Performance (October 2009).

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

State Innovation Models Initiative

• The State Innovation Models Initiative is providing up to $300 million to support the development and testing of state-based models for multi-payer payment and health care delivery system transformation with the aim of improving health system performance for residents of participating states. • The projects will be broad based and focus on people enrolled in Medicare, Medicaid and the Children’s Health Insurance Program (CHIP).

WHAT?

Public & Private: Payment Reform Framework

Source: Catalyst for Payment Reform www.catalyzepaymentreform.org

WHAT?

State Innovation Models Initiative Model Testing Awards

Model Pre-Testing Awards

WHAT? Model Design Awards

State Innovation Models Initiative Model Testing Awards

Model Pre-Testing Awards

WHAT? Model Design Awards

Over $250 million in Model Testing awarded to support six states that are ready to implement their State Health Care Innovation Plans.

State Innovation Models Initiative Model Testing Awards

Model Pre-Testing Awards

WHAT? Model Design Awards

Three states that will receive pre-testing assistance will use the funding to continue to work on a comprehensive State Health Care Innovation Plan.

State Innovation Models Initiative Model Testing Awards

Model Pre-Testing Awards

WHAT? Model Design Awards

• The 16 States that will receive Model Design funding to produce a State Health Care Innovation Plan. • States will use these Health Care Innovation Plans to apply for an anticipated second round of Model Testing awards. • States will have six months to submit their State Health Care Innovation Plans to CMS.

Learning Agenda  WELCOME & FRAMING  WHO?  WHY?  WHAT?  HOW?  LEARNING FROM YOUR QUESTIONS AND REFLECTIONS

Ohio’s State Innovation Model Design Award (4/13-10/13)

HOW?

• The State of Ohio will receive up to $3,000,000 to develop a State Health Care Innovation Plan. • Ohio was one of only two states to receive the maximum award amount. • Ohio will use the SIM grant to develop a comprehensive plan to expand the use of patient-centered medical homes and episode-based payments for acute medical events to most Ohioans who receive coverage under Medicaid, Medicare and commercial health plans. • McKinsey and Co., Inc. was selected as the SIM design and testing vendor. SOURCE: Ohio Office of Health Transformation

Ohio Health Care Payment Innovation Initiative State of Ohio Health Care Payment Innovation Task Force John R Kasich Governor Governor’s Senior Staff

Office of Health Transformation • Project Management Team: Executive Director, Communications Director, Stakeholder Outreach Director, Legislative Liaison, Fiscal and IT Project Managers Participant Agencies • Administrative Services, Development, Health, Insurance, JobsOhio, Ohio Medicaid, Rehabilitation and Corrections, Taxation, Worker’s Compensation, Youth Services, Public Employee and State Teachers Retirement Systems

Governor’s Advisory Council on Health Care Payment Innovation • Purchasers (Bob Evans, Cardinal Health, Council of Smaller Enterprises, GE Aviation, Procter & Gamble) • Plans (Aetna, Anthem, CareSource, Medical Mutual, UnitedHealthcare) • Providers (Akron Children’s Hospital, Catholic Health Partners, Central Ohio Primary Care, Cleveland Clinic, North Central Radiology, Ohio Health, ProMedica) • Consumers (AARP, Legal Aid Society, Universal Health Care Action Network) • Research (Health Policy Institute of Ohio)

State Implementation Teams

Public/Private Workgroups

Patient-Centered Medical Homes

Ohio Patient-Centered Primary Care Collaborative

Bundled or Episode-Based Payments

Ohio Hospital Payment Workgroup

Accountable Care Organizations

Medicare Shared Savings Program Participants and Pioneer ACOs

Other Internal Teams as Needed to Enable Payment Innovation

Other External Groups as Needed to Enable Payment Innovation

HOW?

How can the State of Ohio leverage its purchasing power to improve overall health system performance?

HOW?

State of Ohio Health Care Purchasing Power Insurance Contracts

Provider Contracts

(in millions)

2,100,0001

$5,1122

$8,8523

$13,964

Public Employee Retirement System

221,000

$1,5604

$1,560

Administrative Services

118,0005

$5226

$522

Workers Compensation

213,5744

$7797

$779

Rehabilitation and Corrections

50,2505

$2117

$211

2,702,824

$7,194

$9,842

$17,036

Department

Enrollment

(in millions)

Medicaid

TOTAL

(in millions)

TOTAL

Notes: (1) average monthly enrollment FY 2011, (2) private managed care plans, (3) includes Medicare premium assistance and Part D (an additional $2.8 billion in Medicare spending for Medicare/Medicaid dual eligibles could potentially be managed by the State of Ohio), (4) CY 2010, (5) current population as of October 2011, (6) self insured and contract with third party administrators, FY 2010, (7) FY 2011 Source: Office of Health Transformation survey of agencies (October 2011)

HOW?

View of a Model Testing Award • Arkansas received $42 million over 42 months • Ohio’s strategy is closely aligned with Arkansas’ approach* *Note: using Arkansas to illustrate model testing award

HOW?