Crossing the Uncharted Seas of Transformation · 2016. 7. 14. · Crossing the Uncharted Seas of Transformation. How Innovative Rural Hospitals Will Survive & Thrive in the New World

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www.NationalRuralConsortium.org

Crossing the Uncharted Seas of TransformationHow Innovative Rural Hospitals Will Survive & Thrive in the New World of Healthcare

Monica Bourgeau, MSExecutive Director



2014

2015

2016



The Speed of Change is IncreasingSecretary Burwell’s historic announcement in January of 2015:“Our first goal is for 30% of all Medicare provider payments to be in alternative payment models that are tied to how well providers care for their patients, instead of how much care they provide – and to do it by 2016. Our goal would then be to get to 50% by 2018. Photo Source: iClipart

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The Speed of Change is Increasing

Our second goal is for virtually all Medicare fee-for-service payments to be tied to quality and value; at least 85% in 2016 and 90% in 2018.”

In March of this year, Health and Human Services (HHS) announced that they reached their goals of having 30% of providers in Advanced Payment Models (APMs) ahead of schedule. The speed of change is increasing and they we are now moving toward 50%.

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Value Based Payment ModelsMedicare Incentive Payment System (Starts 2017)

Up to 9% penalty or 27% bonus by 2022$3- $9 Per Member Per Month (PMPM)

Advanced Payment ModelsMedicare Shared Savings Program (Open)

Average Payment = $10 PMPMAIM Funding = $10 PMPM (Semi-closed)

Comprehensive Primary Care Plus (Open-Fee for Service (FFS) only)

Average Payment = $15-$32 PMPMNextGen ACO Shared Savings Program (Open)

$8 PMPM

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2017 MSSP ACO Models• Medicare Shared Savings Program (MSSP)

•Track One•Track Two•Track Three•Next Generation Medicare Shared Savings Program

• Only MSSP Track One is risk-free

www.CaravanHealth.com | Proprietary & Confidential, Not for Distribution 6



The Shift to ValueVolume ValueReactive Proactive

Full Hospitals, Lots of Patients, Treat Illness

Prevention, Wellness, Manage Health

Provider/Facility Focused Patient FocusedTreat Illness Manage HealthPaternalism Team-Based Care

Little Coordination Clinical IntegrationPay Per Unit Data/Tools

Payors Take All Risk Providers Take Some RiskVariance in Practices Evidence Based Practices,

StandardizationNo Measurement Patient Satisfaction

Based on Payment More Flexibility for Providers

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Challenges for Rural Hospitals• Stand alone health systems – two thirds are local governmental facilities

with no affiliations• Little to no growth potential – declining populations • Need to remain financially viable to support community health• Very limited managed care and IT expertise• Independent provider mentality – live free or die• “Sick” care not “health” care orientation• Very difficult to recruit and retain physicians• 70% Medicare and Medicaid with negative margins• Although hospital is only 25% of revenue, it gets 90% of attention• CEO turnover is typically < 3 years• Community board is dedicated but not educated and experienced in

healthcare• Many rural states did not expand Medicaid – and their hospitals are closing

Source: America.Aljazeera

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www.nationalruralaco.com

How Does Rural Score in Value Assessment?

• Cost/Coinsurance• On a risk-adjusted basis, rural patients are more expensive.• Unit costs for critical access hospital (CAH) inpatient and

swing beds, outpatient procedures and provider-based rural health clinic (RHC) visits are typically higher than urban (1-3x) and have higher coinsurance.

• Quality• Agency for Healthcare Research and Quality (AHRQ) study

indicates lower quality scores in rural – also Consortium’s experience.



Current State in Rural: Disparities in Quality of Care Measures for Noncore Areas by 4 NQS Priorities and Access

2 2 1

13 1425 15 16

4 217 11 9

0%

20%

40%

60%

80%

100%

Patient Safety(n=19)

Person-CenteredCare (n=16)

EffectiveTreatment (n=44)

Healthy Living(n=27)

Access (n=25)

Better Same Worse

Key: n = number of measures.Better = Population received better quality of care than reference groupSame = Population and reference group received about the same quality of careWorse = Population received worse quality of care than reference group



Potentially Avoidable Hospitalizations for all Conditions per 100,000 Population, by Residence Location, 2005-2012

0

500

1,000

1,500

2,000

2,500

3,000

2005 2006 2007 2008 2009 2010 2011 2012

Rate

per

100

,000

Pop

ulat

ion

Total Large Central Metro Large Fringe Metro Medium Metro

2010 Achievable Benchmark:938.6 per 100,000 Population

Source: Agency for Healthcare Research and Quality (AHRQ), Healthcare Cost and Utilization Project, 2005-2011 Nationwide Inpatient Sample and 2012 State Inpatient Databases quality analysis file and AHRQ Quality Indicators, version 4.4.



All Emergency Department Visits per 100,000 Population, Adults Age 18 and Over, by Residence Location, 2008-2011

0

1,000

2,000

3,000

4,000

5,000

6,000

2008 2009 2010 2011

Rate

per

100

,000

Pop

ulat

ion

Total Large Central Metro Large Fringe Metro Medium MetroSmall Metro Micropolitan Noncore

Source: Agency for Healthcare Research and Quality (AHRQ), Healthcare Cost and Utilization Project, 2008-2011 Nationwide Emergency Department Sample and AHRQ Quality Indicators, version 4.4.



That Puts the Target on Our Back

• Objective data suggests we are not high value providers.• We have to find a way to participate in ambulatory quality

programs, even though we don’t have to yet, and to advocate for different payment standardizations.

The greatest threat to the sustainability of rural healthcare systems are market forces that will force doctors and patients to choose high value providers and partners –and rural providers will be left behind if they don’t work on these measures.

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How Are CAH Payments Treated for Value-Based Payments• Inpatient and Outpatient is adjusted to prospective payment

system (PPS) rates then divided by weighted wage index for all APMs except ACO’s.

• Swing beds are not– average swing bed stay is almost twice as expensive as SNF stay - could cost tertiary hospitals $10,000 per stay for bundled payments.

• High cost provider-based RHCs may be avoided.• High cost swing beds may avoided.• Low quality providers may be avoided.• ACO’s might avoid high-cost CAHs.

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Change the Delivery System

• The movement from Volume to Value requires a change in the delivery system as well as in the payment model.

• Common Elements from all new payment models• Resources for rural providers

• Transforming Clinical Practice Initiative (TCPI)• Innovation Grants/Programs

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Rural Strengths• Passionate about serving their community• Deep relationships with their population• Nimble – able to change quickly when they

know what to do• Fixed population served “cradle to grave”• Excess capacity can be leveraged to work on population health• Increased local volume reduces per capita costs dramatically when

cost-based reimbursed• Local brand is typically very strong – most beloved institution in town

and major economic driver.

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Common Elements of Success in Advanced Payment Models

Prevention: • Chronic Care Management (CCM)• Annual Wellness Visits (AWV)

• Advanced Care Planning• Behavioral Counseling• Depression Screening• Mental Health Support

Coding: • Hierarchical condition coding (HCC) 101

Quality: • Process• Pre-visit Planning• Patient Satisfaction

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Chronic Care Management Reduces Cost• At risk patients with 2+ chronic conditions expecting to last

for the following 12 months or until death of the patient• Explanation of CCM with written consent• Incident to Primary Care providers• General Supervision except RHC, FQHC• 20 minutes per month• 24/7 access to care team with access to electronic care plan

• Bill approx. $42 pmpm• Shown to reduce cost by 20-60%• Generates an average of $20,000/year in profit

Care Coordination

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Two-Thirds of Medicare Spending Is for People With Five or More Chronic Conditions Percentage of Medicare Expenditures

• Ninety-nine percent of Medicare expenditures are for beneficiaries with at least one chronic condition.

• Ninety-eight percent of Medicare expenditures involve individuals with multiple chronic conditions.

Source: Medicare Standard Analytic File, 2007



Annual Wellness Visits (AWV)• Establishes relationship with primary

care provider (PCP) or team (improves attribution)

• Improves scores on CMS quality measures

• Identifies patients for care coordination (2+ chronic conditions)

• Identifies at-risk patients for early interventions (pre-diabetes)

• Public health screenings • May appropriately increase MD

revenue (RVUs)

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AWV

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AWV –Optional Billing Codes

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AWV –Optional Billing Codes II

Check with your local MAC

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Case Study: Hattiesburg Clinic• Started Slowly in 2012• Nurse-Driven Model for AWV’s• Supports 22+ Nurses in Multi-Site

Clinic (8 AWVs + CCM)• Physician Engagement – Steering

Committee• Patient Engagement & Education• Improved Quality Scores & Patient

Compliance• 2015: Complete Shift in Practice• Wellness & Prevention Focus

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Case Study: Hattiesburg Clinic

Pro Forma• RN Average Salary ($25/hr + benefits @ 25%): $65,000• Nurse sees average 6 patients/245 working days• Total visits/year potential: 1470• Average AWV Reimbursement Per Visit $137.51

There is enough revenue in these new initiatives to drive & sustain transformation

AMGA 2014

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Wellness Visits Drive Quality Up

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Coding• Value-based payments are based on expected cost multiplied by HCC

risk scores. Providers will be penalized for falsely low scores. For example:

• A hospital who has a joint replacement bundle expected cost of $20,000 will get paid the following:

•$20,000 for a patient with an HCC score of 1.0•$18,000 for a patient with an HCC score of 0.9•$22,000 for a patient with an HCC score of 1.1

• HCC risk scores are calculated from all diagnoses listed on bills sent to CMS in the prior calendar year – no institutional memory.

• DOCUMENT ALL SIGNIFICANT CHRONIC CONDITIONS ON THE BILL FOR THIS VISIT. ASK PATIENT ABOUT EACH ONE AND DOCUMENT IN SOAP NOTE. PRIORITIZE IF NECESSARY.

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Quality

• Process• Pre-Visit Planning• Patient Satisfaction

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Transformation Efforts

MACRA Technical Assistance

State Innovation Models

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Practice Transformation Network

Establish Your Value-Based Infrastructure at No Cost.

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Rural Strategic Plan for Transformation

Optimize Cost and Quality (TCPI)

Form Clinically Integrated Networks with Other Independents

Form ACO’s –MSSP,Commercial and Medicaid

Form Rural Provider-Based Medicare Advantage Plans

Enter Commercial and Private Exchanges

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Questions?

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Documents

Crossing the Uncharted Seas of Transformation · 2016. 7. 14. · Crossing the Uncharted Seas of Transformation. How Innovative Rural Hospitals Will Survive & Thrive in the New World