Attaining Scale in a Changing Market

Update on the ACO and the Clinically Integrated Network

Introducing…”Meridian Health Partners”

Richard J. Scott MD MBA FACS CPE SVP Clinical Effectiveness and Medical Affairs

Executive Director, Meridian ACO LLC

Special thanks to the members of the Steering Committee, ACO and Clinically Integrated Network

“Clinical Integration”

• “A means to facilitate the coordination of care across conditions, providers, settings and time in order to achieve care that is safe, timely, effective, efficient, equitable and patient focused” – AMA

• CI is a continuous process of alignment between hospitals and all providers across the continuum that supports the triple aim of health care:

Better care for individuals, better health for populations and lower per capita healthcare costs

Four Pillars of Integrated care

Collaborative LeadershipGovernance body

Compliant legal structurePayer strategyCulture change

Aligned IncentivesValue based compensation

Program infrastructurePhysician leadership and support

Clinical ProgramsDisease programs

Care protocols/PCMHClinical metrics

Population health management

Technology InfrastructureHealth Information Exchange

Disease registriesPatient longitudinal record

Patient portal to enable engagement

Clinically Integrated Care

Collaboration: Current Options for Hospitals and Physicians

Meridian Accountable Care OrganizationBackground and Strategy

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• A legal entity operated and governed by physicians and Meridian Health System under a 50/50 consensus governance model

• The ACO is a low-risk laboratory wherein Meridian and its physician community can begin to learn population health and develop infrastructure to potentially assume risk contracting with payers

• It is also a vehicle to build market share, and the prototype for other “bend the trend opportunities”

• In each of the next 3 years, if MACO can decrease cost and document quality, savings are eligible to be shared between CMS and MACO.

• MACO has received historical beneficiary claims information from CMS. The data show savings opportunities in:– Hospital Admission– Emergency Room Visits– “High Cost” Imaging

Bending the trend…and sharing the savings

Under the MSSP, up to 50% of the savings can be returned to the ACO for distribution to providers

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Meridian ACO LLC First Year Key Metrics• Effective Date: January 1,

2013– Uniquely Attributed

Medicare Lives (Original 39,705; Current 59,446)

– Participating Physicians 874

– Participating PCP’s

250– Medicare Spend

$454,000,000 (on 39,705)

– Average Age 74.3 years

– Gender

57% Female 43% Male• Year 1 infrastructure app.

$1.3M• Five Population health

managers hired

Annual ACO Quality Audit

• N = 4,244 beneficiaries identified for quality data• 5 high-risk care managers collected data with support from 3

others in department• 89 unique physician practice locations visited

– 60% of practices had all or part of record on paper• 12 nursing homes/other facilities visited

– Only one non Meridian nursing home had required information in electronic format (MHS locations had Sigmacare)

• Numerous calls to non-ACO physicians to get required information (e.g., ejection fraction, mammograms, lipid values)

3,898 miles driven by team

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Augmented Connectivity to Serve Clinical Integration- Jersey Health Connect

• Atlantic Health System• Barnabas Health• Centrastate• Chilton Hospital• Deborah• Holy Name Medical

Center• Englewood Medical

Center• Trinitas

• Robert Wood Johnson• St. Peters Univ. Hospital• Hunterdon Healthcare• Hackensack UMC• Children’s Specialized

Hospital• The Valley Hospital• St. Clare’s Health

System• Summit Medical Group• Optimus Healthcare

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Meridian ACO Yr 1 Quality Performancevs 2012 ACOs (n=146)

Meridian Accountable Care• ACE or ARB Tx 72%• HTN Control(<140/90) 72%• HbA1c Control(<8.0) 77%• Tobacco Non-use 78%________________________ ChallengesDepression ScreeningFalls risk ScreeningMedication reconciliation

Physician/ACO Compare • ACE or ARB 69%• HTN Control 67% • HbA1c Control 65%• Tobacco Non-use 72%________________________

All fall below the 30%tile- Will need improvement year

Two (PFP years two and three)

30-Day All-Cause Readmissions/1,000 Discharges

0

50

100

150

200

2010 2011 2012 1Q2013 2Q2013 3Q2013 4Q2013

Meridian ACO Total ACO

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Total Expenditures/Assigned Medicare Beneficiary

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Meridian RN Population Health Managers

• New role in 2013 to support the Medicare Shared Savings Program (MSSP)

• Telephonic care management for high-risk patients and patients with multiple chronic conditions

• Collaborate with provider offices designated as PCP• Ensure services are deployed as needed across the

continuum through collaboration with existing providers• Makes visits to hospitals, rehabilitation facilities, homes,

provider offices, and other locations as needed• Experts in performance monitoring at multiple levels:

patient, provider, practice, and ACO

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Hypothetical Savings and DistributionsYear 1 for a 462M MSSP Program

If the ACO “bent the trend” and collected/submitted data accurately and on time:

- 2.0% = $9.24M Did not meet threshold

- 2.3% = $10.6M (50% = $ 5.3M)- 3.0% = $13.8M (50% = $ 6.9M)- 5.0% = $23.2M (50% = $11.6M)- 10.0% = $46.2M (50% = $23.1M)

Distributable to ACO (1)

Total

$ 0 to ACO

$ 4.3M $ 5.9M $10.6M $22.1M

(1)Based on 2013 Projected ACO Expenses of over $1.0M to be repaid before distributions.

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MSSP 2012 “Winners” (114 Original, 44 had savings, 29 qualify for bonus payments)

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Commercial ACO Activity Across New Jersey

• Horizon partnering with Central Jersey ACO, AtlantiCare ACO and the Optimus ACO on shared savings programs that include Medicare Advantage.

• CIGNA has announced a national goal to have 1,000,000 CIGNA insureds in PCMH Pilots by 2014. In NJ:– CIGNA/Atlantic Health 15,000 covered lives– CIGNA/Summit Medical Group 10,000 covered lives

• Aetna partnering with Optimus for 11,900 covered Medicare Advantage lives in a shared savings model.

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Financial Success From Patient Management

Keep patient healthy, engaged

with the system

Avoid unnecessary higher-acuity, higher-

cost spending

Trade high-cost services for low-

cost management

High-

Risk

Patients

Rising-Risk Patients

Low-Risk Patients60-80% of patients; any minor conditions are easily managed

15-35% of patients; may have conditions

not under control

5% of patients; usually with complex

disease(s), comorbidities

Managing Three Distinct Patient Populations

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Joint Venture: Advocate Physician Partners

Advocate Physician Partners delivers services throughout Chicagoland and

Downstate Illinois.

• Physician Membership– 1,138 Primary Care

Physicians– 2,984 Specialist Physicians

• Total Membership Includes 1,300 Advocate-Employed Physicians

• 12 hospitals, encompassing 11 acute care hospitals and the state’s largest integrated children’s network

• Central Verification Office Certified by NCQA

• 250,000 Capitated Lives/ 700,000 PPO Lives/ 100,000 MSSP Lives

• 320,000 “Attributable” Lives• One model for Governmental and

commercial ACO-like Contracts

Changing Paradigms…

FROM ... TO ...

Silo Care Management Enterprise care management

Episodes of Care Coordination of care

Discharges Transitions

Utilization Management Right Care, Right Place, Right Time

Caring for the Sick Keeping People Well

Production (Volume) Performance (Value)

Physicians members Physician partners

AdvocateCare Model: changing the culture toward population health management

Clinical Integration at WellSpan.. “working as one”

• Like Advocate, have organized a pluralistic 1200+ physician delivery system

• 660 employed and 600+ private practice physicians

• Coordinated continuum of services:90 sites

• “Working as one” to create healthy communities through exceptional care and lifelong wellness

• Three hospitals• 65% market share• 1.5 B in revenue• Regional leader in Trauma,

Neurosciences, Cardiovascular

Both WellSpan and Advocate Health…

• Have invested in Information technology that links all elements of care (e.g. hospital, specialist, home health agency, nursing home) and the patient’s community (e.g. family)

• Have connected their medical staff to the system, and each other

• Have organized their physicians into a unified delivery system that includes facilities, services and physicians

• Are positioned as population health managers to provide value and accept risk

Possible Employee pilot:

Inner Circle Network

Meridian Health (2014) Partners, Inc.

Clinically Integrated Network

Meridian (2013) Accountable Care Organization,

LLC

Clinical Integration Steering

Committee

Medicare Shared Savings

Program (ACO)

Future Commercial

Performance-based

Opportunities

These functions

have been combined Effective Q1 2014

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Forming Meridian Health PartnersKey Considerations

STRENGTHSWe have a reputation for quality care and best practiceoutcomesMeridian service lines in trauma, cardiac are importantservices for payers- Current network a solid foundationBrand has great strength and attraction in our marketGrowing care delivery network and a formidablecontinuum are an asset to a risk sharing network

WEAKNESSESPopulation mgt requires a robust Health datawarehousePhysician connectivity a critical success factor forpartnership/population managementanalytics/metricsPayers are actively trying to fragment the market-designing narrow networks

OPPORTUNITIESAn employee pilot could add relevance toMHPartner .If Contracts allow, MHP could become the "Inner Circle"in 2015.

Emerging payer trend to create shared savingsprograms could accelerate network creation- A chanceto learn "risk" contracting

THREATSPayers are going "direct to physicians" inPCMHproducts focused mainly on utilization

Regulatory issues make co-venture more complex

Pressure on margins from operations creates riskaversion- Can we jump to "curve B" ? Requires culturalrevolution for both physicians and health system.

Building “Meridian Health Partners”

Mission Statement

A fully integrated partnership between Meridian Health and its physicians created to provide the highest quality, most accessible and most efficient health services in Monmouth, Ocean and our adjacent counties.

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Vision Statement

A fully integrated physician-health system enterprise, providing clinical quality and efficiency that is demonstrably better than its competitors

A “pluralistic” model, providing efficient practice support, clinical integration, connectivity and network services to physicians in a variety of practice models

A vehicle to ensure the availability of primary and specialty medical care services, ambulatory care, home care, long term care and ancillary services

A platform to successfully integrate care and participate in pay for performance, quality and other value based initiatives with governmental and commercial payers

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Value for Hospitals

• Creates Business Partnership with Key Physicians

• Focuses Physicians on coordinated care – Patient Safety– Controlling costs

• Creates alignment• Physicians Drive Clinical

Outcomes• Positions for Health Care Reform

– ACOs– Readmission Avoidance– Migration to Risk acceptance?

• Access to and/or participation in “shared savings” and other contracts with payers- One interface

• Better alignment between primary care and specialists- Network integrity

• Marketplace recognition for quality care and excellent patient experience

• Support staff for chronic condition registries and QI initiatives

• Management/HIT expertise from system

Value for Physicians

Shared Savings Contracting: Tenets for a workable Model

In order to have a successful shared savings contract model

1.The Network must consistently perform better than the market

2.Improve quality and access to care

3.Reduce cost/decrease complications and readmissions

4.Promote network integrity/minimize medically unnecessary

costly out migration

5.Increase volume to providers participating in Meridian Health

Partners

Enhance physician and patient satisfaction

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“Meridian Health Partners”

MHP will seek a higher level of clinical integration through enhanced connectivity with the system, regional health information exchange and eventually each other

Over 600 “system based” and contractually aligned physicians are already on board- including primary care, faculty practices and hospital based physicians

Actively seeking clinical pilots with health insurance companies that evolve the “shared savings model” focused on quality and efficiency

Substantial payer interest in Meridian’s CIN

“Meridian Health Partners”

Shared Governance

Consensus decision making

Physicians comprise the majority of Board Members

The ACO and MHP initiatives share one combined board and committee structure

No capital investment beyond time and expertise

“Meridian Health Partners” Participation agreement provisions

Commitment to move toward an EMR will facilitate quality performance and point of care interventions. (Meridian’s IT Subsidy program currently being revised to support clinical integration and information exchange)

Initial contract opportunities parallel the ACO- Upside only

“shared savings” or performance incentives for quality and efficiency measures- all would participate

Aligned Voluntary staff may “opt out” of any future fee schedule or global risk contract arrangements

Unlike the MSSP ACO- Participation is “non exclusive” for both Primary Care and Specialist physicians

Meridian Health Partners: Poised for Population Health

Meridian’s Connected Continuum

• Our system based physicians and the Meridian facilities are already committed to the effort

• Hospital based groups now joining the initiative bring enrollment to over 600 physicians

• Enrollment of aligned independent physicians will begin in June, giving them access to both shared savings/risk program opportunities as they arise

• Connectivity to Jersey Health Connect will be supported to successfully manage quality improvement and network performance

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Next Steps….

Thank You !

rscott@meridianhealth.com

6 Hospitals: 1,700+ beds Jersey Shore University Medical Center K. Hovnanian Children’s Hospital Ocean Medical Center

Partner Companies Post Acute Care: 6 facilities, 906 beds At Home Nursing, Hospice, & Rehab: Serving all of Central New

Jersey Ambulatory Care: 19 facilities, including hospital based Primary Care: 102 physicians Ambulance/Medical transport: 100+ vehicles Occupational Health: 6 centers Rehabilitation and Fitness: 9 outpatient, 2 inpatient facilities Behavioral Health: 5 outpatient, 2 inpatient facilities

Meridian’s Powerful Continuum Key Health System Statistics

Over 100 Convenient Locations $1.7 Billion in Annual System

Revenues 12,000 Team Members 2,100 Physicians on Staff Riverview Medical Center

Southern Ocean Medical Center Bayshore Community Hospital

A 50/50 joint venture between Meridian and Geisinger Enabled Meridian to enter the insurance market Initially a 2-county Medicare Advantage offering

724 participating physicians

Meridian Geisinger Gold

Superstorm Sandy disrupted 2012 open enrollment

Live January 1, 2013 with 875 members last year

Enrollment up nearly 5 fold to over 4,300 lives for 2014

Meridian is uniquely positioned for growth!

ACO Performance DomainsApplication of Rules for 2014 (Using Meridian ACO 2013 Data)

Domain Status/Issues of Ability to Share in Savings

Patient/Caregiver Experience (7 measures) Unknown – survey conducted by CMS this year

Care Coordination/Patient Safety (6 measures)

Unknown - 4 of 6 measures provided by CMS

2 of the 6 are <CMS 30th percentile

Corrective Action Plan (CAP) Activation since 70% of all measures in a domain do not score above minimum attainment level. If unknown 4 are >30th percentile, then 66.7%.

Preventive Health (8 measures) None <CMS 30th percentile

At-Risk Populations (12 measures) None <CMS 30th percentile

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