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7/15/2019
1
#FSHP2019
Communicating the Value and Outcomes of the Pharmacy
Enterprise to the C-Suite
Scott Knoer, PharmD, MS, FASHPChief Pharmacy Officer
Cleveland Clinic
#FSHP2019Disclosures
• The Presenter has no conflicts to disclose
#FSHP2019Pharmacist Objectives
• Describe how to tie senior administration’s priorities and expectations to your departmental goals and business plans
• Identify the most appropriate strategies and metrics to demonstrate outcomes to administration
• Summarize how to most effectively communicate the impact of clinical and cost savings initiatives to senior administration
#FSHP2019Technician Objectives
• Define pharmacy metrics• Outline how your position impacts the financial and
quality metrics upon which your department is judged• Use an effective communication strategy to describe your
role to the pharmacy management team and your peers
#FSHP2019Established Feb 28, 1921• Four Physicians• MD Group Practice
Physician-Led Non-Profit Organization• Group Practice Hospital / Clinics
Bring together diverse specialists to think and “act as a unit”
Mission: “…care of the sick, investigation into their problems, and further education of those who serve.”
#FSHP2019
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#FSHP2019U.S. News & World Report’s“2017-2018 Best Hospitals”
No. 2 on National Honor Roll
Rank Hospital Points Specialty
1 Mayo Clinic, Rochester, Minnesota 414 15
2 Cleveland Clinic 385 143 Johns Hopkins Hospital, Baltimore 355 15
4 Massachusetts General Hospital,Boston 354 16
5 University of Michigan Hospitals –Michigan Medicine, Ann Arbor 324 14
#FSHP2019U.S. News & World Report’s2017 Specialties
Rank Specialty Rank Specialty
1 Cardiology &Heart Surgery 4 Diabetes & Endocrinology
1 Urology 4 Neurology & Neurosurgery
2 Nephrology 5 Gynecology
2 Gastroenterology & GI Surgery 5 Geriatrics
2 Rheumatology 5 Cancer
3 Orthopedics 9 Ophthalmology
3 Pulmonology 11 Ear, Nose & Throat
#FSHP2019
1. Mayo Clinic2. Cleveland Clinic3. Singapore General
Hospital4. Johns Hopkins5. Charite – Berlin
6. Massachusetts General Hospital
7. Toronto General Hospital8. University of Tokyo Hospital9. Lausanne University Hospital
– Switzerland10. Sheba Medical Center at
Tel HaShomer
#FSHP2019
ClevelandClinic
Integrated Health Systemserving 6 million patients
Fairview Hospital
Lutheran Hospital
Ashtabula County Medical Center
Euclid Hospital
Hillcrest Hospital
South PointeHospital
Marymount Hospital
Akron General Medical Center
HAvon Hospital
Medina Hospital
H
H
H
H
H
H
H
H
H
FHCFHCElyria Family
Health Center
Westlake FamilyHealth Center
Strongsville Family Health and Surgery Center
Brunswick FamilyHealth Center
Wooster FamilyHealth Center
Solon FamilyHealth Center
Chagrin Falls FamilyHealth Center
Beachwood FamilyHealth and Surgery Center
Willoughby HillsFamily Health Center
Stephanie Tubbs JonesFamily Health Center
Twinsburg Family Health Center
FHC
FHCFHC
FHCFHCFHCFHC
FHCFHC
FHCFHC
Independence FamilyHealth Center
FHCFHC
FHCFHCFHCFHC
Lorain Family HealthAnd Surgery Center
FHC
LakewoodFamily Health
Center
FHCFHC
FHC
FHC
HUnion Hospital
#FSHP2019 #FSHP2019
Cleveland Clinic - Weston
Martin South HospitalMartin North Hospital
Tradition Hospital
Indian River Hospital
Outpatient CenterRegional Hospital
Build a high-quality, value-based, integrated
healthcare system of scale to serve needs of
Florida communities
OUR VISIONOUR VISION
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#FSHP2019
Cleveland Clinic NevadaLou Ruvo Center for Brain Health (Las Vegas)
#FSHP2019Cleveland Clinic Abu Dhabi
Cleveland Clinic CanadaToronto Health & Wellness Center
Cleveland Clinic London
International Locations
#FSHP2019Cleveland Clinic London
#FSHP20192018 CC Pharmacy Enterprise Budget
Inpatient318
31%
HOP/Clinic386
37%
Specialty156
15%
Ambulatory107
10%
Other75
7%
$1.04 Billion
Source: Pharmacy Purchasing Datawarehouse YTD through Dec 2018
Milli
ons
#FSHP2019
Cleveland Clinic Pharmacy Enterprise: 1,410 FTEs
• 19 Retail Pharmacies• Mail Order Pharmacy• Specialty Pharmacy• Home Infusion
Pharmacy
#FSHP2019
What is Important to Your C-Suite• What is the C-Suite?• What is the CEO’s Strategic Plan?• What is important to your Boss should be important to
you…• Cascade strategy throughout enterprise
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#FSHP2019
CEO 2019 Objectives and Key Results (OKRs)
#FSHP2019Care for PatientsObjectives Key Results 2018 Metric 2019 Goal
Zero harm for the safety of our patients Safety Serious Events (#) 87 54
Deliver highest quality careMortality Observed to Expected (Ratio) 0.76 0.74
Deliver optimal patient experience
HCAHPS Would Recommend (% yes definitely) 79% 80.5%
Care for patients across their lifetimes Lives in Primary Care Panels (#) 709,452 TBD
* Milestone-based goals will receive a green / yellow / red based on whether they are on track / delayed / off track
#FSHP2019Research and EducationObjectives Key Results 2018 Metric 2019 Goal
Research tomorrow's treatments Research Funding ($M) $201M $207M
Educate tomorrow's caregivers
Board Pass Rate (%) 94% 100%
Health Education Campus construction* HEC 1st Student 7/1/19
Innovate tomorrow's care Invention Disclosures 67 70
* Milestone-based goals will receive a green / yellow / red based on whether they are on track / delayed / off track
#FSHP2019Care for CaregiversObjectives Key Results 2018 Metric 2019 Goal
Be the safest place in healthcare
Workplace Violence Events(Rate per 100 FTEs) 0.25 0.21
Be the most diverse & Inclusive place to work
Leadership Diversity* Achievement of Annual Goal
Caregiver Diversity* Achievement of Annual Goal
Be the most engaged place to work
Regrettable Turnover 9.3% 8.30%
Would Recommend As Place to Work (%tile) 69th %tile 90th %tile
Be the best place to learn and grow
Caregivers with Development Plans (OKR Goals) 83% 90%
* Milestone-based goals will receive a green / yellow / red based on whether they are on track / delayed / off track
#FSHP2019Care for the OrganizationObjectives Key Results 2018 Metric 2019 Goal
Serve twice as many patients over the next 5 years
Unique Patients (#) 2.01 M 2.57 M
Be responsible stewards of our resources
Operating Revenue ($B) $8.9B $10.4B
EBIDA Margin (%) 10.1% 10.1%
Grow physically
Ohio Growth*90K additional lives from 21 counties12K additional lives from new Ohio
Markets
Florida Integration* Integration Plan by 6/30/19Abu Dhabi Unique Patients Growth(#) 90,985 97,354
London (% project plan milestones) n/a 95%
Grow digitally Virtual Visits (%) 0.88% 1.70%* Milestone-based goals will receive a green / yellow / red based on whether they are on track / delayed / off track
#FSHP2019Care for the CommunityObjectives Key Results 2018 Metric 2019 Goal
Develop our local communities
Economic Impact ($B) $17.8 B n/a
Community Benefit ($M) $906.5 M $950M
Advance important public health initiatives
Opioids Prescriptions (MMEs) 317M 253M
* Milestone-based goals will receive a green / yellow / red based on whether they are on track / delayed / off track
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#FSHP2019Annual Strategic Planning Session
• Every Fall• All Direct Reports and
some guests• Outside speaker to set
the tone
#FSHP2019
Establish one new consult agreement in all
retail locations by 12/31/19.
Increase patients seen under consult
agreements by 10% by 12/31/19
Expand continuation of therapy in retail
locations to include all FHCs by 12/31/19
Increase referrals in smoking cessation by
30% by 12/31/19
Pharmacy OKRsExpansion of pharmacy services
with utilization of consult agreements
Key Result Key Result Key Result
Care Priority: Care for Patients Executive Owner: Sokn, Soder, C
Key Result
#FSHP2019
Implement USP 797, 800 compliance for inpatient and
FHC’s by 12/2019
Completion of caregiver compounding training and
competency by 09/2019
•Documented training for caregivers
Electronic repository for review and audit of all clean room
certification reports with concurrent review with escalation
and resolution if required
OKR- Lead medication safety, quality, and pharmacy regulatory compliance
effortsKey Result Key Result Key Result
Care Priority: Patient Executive Owner: Milner & Egger
#FSHP2019
Reduce pharmacist job description to 1 by
6/2019
Reduce clinical specialist job description
to 1 by 10/2019Number of pharmacists
enrolled in the PARP
OKR- Standardize core pharmacy caregivers key performance
indicators, job description, and development of our pharmacists
Key Result Key Result Key Result
Care Priority: Caregiver Executive Owner: Leonard & Glowcz
#FSHP2019
Achieve $11 million in cumulative costs savings
by end of 2nd quarter
Achieve $12 million in cumulative cost savings
by end of 3rd quarter
Achieve actual target of $13 million in cost
savings by end of year 12/2019
• Executive dashboard
• Audit Review
OKR- Ensure cost-effective medication use, formulary
management, and capitalize on new opportunities for cost savings
Key Result Key Result Key Result
Care Priority: Organization Executive Owner: Leonard
#FSHP2019
Achieve $11 million in cumulative costs savings
by end of 2nd quarter
Achieve $12 million in cumulative cost savings
by end of 3rd quarter
Achieve actual target of $13 million in cost savings by end of year 12/2019
• Executive dashboard
• Audit Review
OKR- Ensure cost-effective medication use, formulary
management, and capitalize on new opportunities for cost savings
Key Result Key Result Key Result
Care Priority: Organization Executive Owner: Leonard
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#FSHP2019
Sales and Marketing
• If nobody knows about it, it didn’t happen…• Must actively communicate upstairs
#FSHP2019
Ambulatory Communication
#FSHP2019
CC Retail Pharmacy $ Value 2018
•Store EBIDA• $921,000
•Specialty EBIDA• $3,961,000
•EHP Cost Avoidance• $7,306,000
•Total Value = $12,188,000
#FSHP2019Home Infusion Value
•Net Revenue = $25.3M•EBIDA = $4.2M
#FSHP2019Specialty Revenue
Monthly Trending
$0.0
$5.0
$10.0
$15.0
$20.0
$25.0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
millions ($)
2017 2018 2019
#FSHP2019Rx Volume Monthly Trending
Ambulatory Pharmacy (no Specialty)
‐
20,000
40,000
60,000
80,000
100,000
120,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec2017 2018 2019
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#FSHP2019Rx Volume: Ambulatory Pharmacy
(no Specialty)
0
20000
40000
60000
80000
100000
120000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
EHP 2017 EHP 2018 EHP 2019 Trade 2017 Trade 2018 Trade 2019
#FSHP2019Wait Times
All Ambulatory Pharmacies
0
2
4
6
8
10
12
14
16
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2017 2018 2019 Target
#FSHP2019Bedside Prescription Volume
Main Campus Ambulatory Pharmacies
‐
1,000
2,000
3,000
4,000
5,000
6,000
7,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2017 2018 2019
#FSHP2019
Bedside Prescription VolumeAll Ambulatory Pharmacies
(Includes Main Campus, Weston FL, Marymount, Fairview, Avon, Medina, Lutheran, Hillcrest, Akron and South Pointe & Euclid locations)
‐
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2017 2018 2019
#FSHP2019
Employee Health Plan Communication#FSHP2019
Copay Card Program Cost Avoidance
37 38
39 40
41 42
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#FSHP2019CCHS Plan Performance vs. PBM
Hospital Employer Book of BusinessJanuary through December 2018
Metric CC EHPHospital Employers
Variance
Gross Cost PMPM $101.24 $122.87 (17.6%)
Net Cost PMPM $83.35 $111.11 (25.0%)
Generic Dispensing Rate 87.9% 87.0% 1.0%
Generic Substitution Rate 99.3% 99.0% 0.3%
#FSHP2019
Program Impact
#FSHP2019
$28 PMPM x 12 mo x 100,000 members = $33.6M savingsper year
#FSHP2019
Inpatient Prescription Drug Spending Per AdmissionCompound Annual Growth Rate
4.7%
3.8%
US Community Hospitals* CCF Main Campus
*American Hospital Association: Recent Trends in Hospital Drug Spending and Manufacturer Shortages, 2019
2017 - 20192015 - 2017
#FSHP2019Inpatient Communication
#FSHP2019
2018 CC Pharmaceutical Purchases
Inpatient318
31%
HOP/Clinic386
37%
Specialty156
15%
Ambulatory…
Other74
7%
$ 1.04 Billion
Source: Pharmacy Purchasing Datawarehouse YTD through Q4 2018
Mill
ions
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#FSHP2019
Decreasing Inpatient Pharmacy Expenses
• Formulary Management• Managing additions• Restrictions
• Supply Chain Contracting• Insourcing
#FSHP2019
Rx Cost Reduced by $129 Million since 2010
$0
$5
$10
$15
$20
$25
$30
2010 2011 2012 2013 2014 2015 2016 2017 2018
Annualized Savings (Millions)
Annualized Savings
#FSHP20192019 Pharmacy Cost Savings
$ in Millions
$10.8
$16.5$5.6
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
$14.0
$16.0
$18.0
Potential Savings Captured Savings Remaining OpportunityFormulary & Supply Chain
#FSHP2019
CCHS Medical Staff P&T Formulary Panels/Committee
CCHS Med Staff P&T
Committee
Internal Medicine
Hematology/ Oncology
Children’s Hospital
Critical Care/ Surgery/
Anesthesia
Neurosciences
Cardiovascular
Antimicrobial
Med-Related Policy
Transplant (Main campus/
Florida only)
Emergency Medicine
#FSHP2019Managing High Cost Drugs
• Do not add drugs to Formulary (lack of evidence-based medicine)
• Remove drugs from formulary• Use therapeutic alternative(s)• Convert from brand to generic• Change drug preparation• Modify order sets
#FSHP20192018 CCHS Formulary Activity
4%
45%39%
7%5%
Decisions
Added Added with RestrictionsChanged Restriction DeletedDid not Add N=83
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#FSHP2019
Examples of Cost Avoidance by Not Adding Drug to Formulary
• Angiotensin II (Giapreza®)• Less expensive alternative formulary agents
• Norepinephrine/Vasopressin• Estimated cost per year = $1 million
• Andexanet alfa (Andexxa®)• Less expensive alternative formulary agent: Feiba®
• Estimated cost per year = $3 million
#FSHP2019
Pharmacy Spend vs Vizient Benchmark
Better than Vizient pharmacy contracts in 2018
$70M
#FSHP2019
Cost Savings from Insourcing Compounding
•Annual Savings• Cardioplegia - $1.1M• TPN - $1.1M• Amiodarone - $450K• Florida - $180K
#FSHP2019
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