Pacing Volume-to-Value Transition and The ROI of Avoiding Antibiotic Overuse

Scott Clay, Consulting Principal

Alabama Hospital Association Annual MeetingJune 10, 2016

TIMING IS EVERYTHING

Pacing the Volume-to-Value Transition

Prepared for Alabama Hospital Association Page 2

The Dilemma


Positioning for TransformationTiming Is Everything!Decisions on when and how to change payer contracting strategies and underlying operational platforms must be informed by four key considerations:

Government Policy Drivers

Local and Regional Market Drivers

The Organization’s Current Position/Profile with Regard to Value-Based Transition

The Organization’s Strategic Intent for Adoption of New Care Models


CMS’ Push to Value-Based Reimbursement

CMS is setting the “floor” on the level and pace of change required.

2016 2018

30%In alternative payment models, e.g. ACOs, bundled payments.

50%In alternative payment models, e.g. ACOs, bundled payments.

85%Tied to quality and efficiency measures.

90%

Medicaid APMs provide opportunity to minimize losses with less downside risk and provide upside by minimizing use of high-cost services.

Tied to quality and efficiency measures.

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Five Key Market Drivers

Population Size and Density

Market Costs and Use Rates

Commercial Payer Activity

Employers

Competitors

Even markets with limited local pressure will require change based on federal and state healthcare programs.


Knowing Where Your Organization StandsWhile there is no “right” answer at any point in time, leaders must

understand and acknowledge where they stand – and why.

Four Current Status Profiles for New Care Models

Watching and Waiting

Beginning the Course

Mid-Course/Into the Corner

In the Final Lap


Three Important Process Elements

1 Discussions must include broad stakeholder involvement including “critics” as well as “champions.”

2 The assessment must honestly reflect how the organization really behaves rather than how it would like to think of itself – or the image it would like to project.

3 The assessment must include a reflection on what has influenced the organization to be in this position at the current time.

Is it strictly a reflection of external factors? Does it reflect a risk-averse culture? Did historical experiences influence the perspective?


How does the organization want to be positioned in the future?What pace of change is required to achieve that goal?

Four Strategic Intent Profiles for New Care Models

Protect and Defend Current Status

Steadily Advance with the Market

Catch Up to the Market

Disrupt the System and the Market


Closing the GapHow Much Change is Required to Reach Your Goal?

Degree of Change Required to Move from Current Profile to Strategic Intent

Strategic Intent

Protect and Defend Current

StatusCatch Up to the

Market

Steadily Advance with

the Market

Disrupt the System and the

Market

Current Status

Watching and Waiting Moderate High High Very High

Beginning the Course Low Moderate High Very High

Mid-Course/ Into the Corner N/A Low Moderate High

In the Final Lap N/A N/A Low Moderate


Monitoring Market MovementMonitor to Determine Optimal Timing for Key Initiatives

Organizations must answer three questions to establish an effective market monitoring capability:

What are the few strategic-level market metrics needed to monitor to inform major decisions?

How do these differ based on an organization’s current position and strategic intent?

What are the “trigger points” that indicate a significant market shift?

1

2

3


Monitoring Market MovementCommon Market Metrics to Track Pace of Change

Metrics can serve as trigger points that indicate significant market shift demanding immediate action.

Population Size and Density

Market Costs and Use Rates

Payer Activity

Employers

Competitors


Across the Finish Line

While the industry continues to evolve to alternative payment and care models, a more nuanced approach is emerging for individual systems.

By honestly assessing who they are and where they want to be positioned in their market, healthcare systems can pace their change to reflect the reality of their local markets and proactively manage the risk of transition.

PERSHING YOAKLEY & ASSOCIATES, P.C.800.270.9629 | www.pyapc.com

Scott ClayPrincipal

[email protected]

June 10, 2016Presented by:James M. Keegan, MD

ALABAMA HOSPITAL ASSOCIATION

The ROI of Avoiding Antibiotic Overuse


Presented byJames M. Keegan, MD

Native Kingsport, Tennessee

Emory University, Atlanta, Georgia

U.S. Air Force, Ellsworth AFBSouth DakotaCommendation: Meritorious ServiceChief of Medical Staff

University of VermontInfectious Disease Fellowship

1986-1990 Clinical Practice of Infectious Disease

with Fred Kerns, MD, Charleston WV

1990-2005 Clinical Practice Infectious Disease

1990-Pres Medical Director of Infection Control,

Rapid CityRegional Hospital and

Regional Health(Western SD)

2001-Pres Medical DirectorAntibiotic Stewardship,Rapid City Regional Hospital

2005-2013 Administrative Leadershipin Regional Health

Vice President Quality Chief Medical OfficerChief Executive Officer of Regional HealthPhysicians 1 of 5 Senior ExecutiveTeam Members


“Success is walking from failure to failure with no loss of enthusiasm.”


Winston Churchill


“He who knows best knows how little he knows.”


Thomas Jefferson


“Leadership is about making others better as a result of your presence and making sure that impact lasts in your absence.”


Sheryl Sandberg


The Problem – Antibiotic ResistanceThe Global Health Crisis

Each year in the U.S. at least 2-million Americans will become infected with bacteria that are resistant to antibiotics, and at least 23,000 die each year as a direct result... CDC

By 2050, more people will die (worldwide) from antibiotic resistance than from cancer. BBC


The Problem – Antibiotic ResistanceThe Global Health Crisis

…20-50% of all antibiotics prescribed in U.S. acute care hospitals are either unnecessary or inappropriate.”

Similar to the findings in hospitals, studies have shown that 40–75% of antibiotics prescribed in nursing homes may be unnecessary or inappropriate.”

“We can either work to improve antibiotic use and prevent infections, or watch as the clock turns back to a world where simple infections kill people.”

Tom Frieden, CDC


Historical Prescribing Practices

90-95% of all sinus infections are viral, yet…”


Empiric Prescribing and Risks

At community hospitals, ONE of THREE patients with bloodstream infections given

inappropriate therapy.” Duke University

: Treatment given without knowledge of cause or nature of disorder and based on experience, rather than logic.

Simple Definition of EMPIRICAL

empiricaladjective | em-pir-i-kuh-l


The Dilemma for Physicians

Patient Expectations Prescribed antibiotic validates

illness Antibiotic often considered a

“cure all” Patient satisfaction scores

Physicians prescribe how they have been historically trained

Treating the patient vs. solving world issues


Regulatory Environment

Infectious Diseases Society of America (IDSA) & Society for Healthcare Epidemiology of America (SHEA) recommend antibiotic

stewardship as a Condition of Participation by December 2017 to Centers for Medicare &

Medicaid Services (CMS)”

CMS Requirement Immanent?

IDSA and SHEA letter to CMS, March 4, 2014.


Message Going MainstreamGrowing Public Awareness of the Problem

“USA needs to take immediate steps to fight super bugs, experts say.”


Broad Spectrum AntibioticsUse by State

Use of Quinolones in 2012Source: IMS Xponent


MRSAIncidence by Region


There is a disconnect, why?

Changing clinical behavior is difficult

Limited Antibiotic Stewardship experience

Broadcasting the problem does not equate with solving

the problem

Pharmacy champions and

others may not be

comfortable with task of

changing physician

prescribing behavior


What We Are Seeing

RESULTS

OBSERVATIONS

30 Hospital Collaborative


CDC Core Elements

13 Centers for Disease Control and Prevention, CDC, “Core Elements of Hospital Antibiotic Stewardship Programs.”

Leadership Commitment

Accountability

Need Drug Expertise

Active OversightTracking

Reporting

Ongoing Education

Antibiotic Stewardship


Our PhilosophyPRIMUM NON NOCERE

“Aggressive Diagnostics and

ConservativeTherapeutics”


The Role of Diagnostics

Rapid Diagnostics Pay now or pay more later Prescribing contingent

upon lab results


Clostridium difficile (C.difficile)Thoughts about this HAI

CDC Hazard Level Rank: Urgent Threat Assessment – Highest

level DEADLY: “Contracting C. diff drastically reduces your chance of

leaving the hospital alive. If two patients come into the hospital with the same diagnosis, the one who gets C. difficile is four times more likely to die.”

EXPENSIVE: $10K per incidence (national average)

“I know that today I had 3 rooms closed down for C.diff. Meaning the patients had discharged and the rooms steri-misted. Still have to confirm they're clean

before reopening them to accept patients. Normally takes 72 hours, depending on when environmental services get there to steri-mist it”


Valley Hospital ASP ResultsC. difficile and ABX Correlation


Hospital Engagement Sample ResultsC. difficile and Antibiotics Correlation


PenicillinAllergy

If you are hospitalized and declare a penicillin allergy,

your mortality risk doubles if you are prescribed an

alternative medication

Avoiding penicillin means using alternatives that are less

effective, more expensive or have greater side effects

Add length of stay increase

Dangers for those /Treatment risk for those who think

they are allergic


Antibiotic Stewardship ProgramDirect and Attributable Financial Benefits

20-50% reduction in total antibiotic expense with emphasis on broad spectrum antibiotics. Clinical improvement to more precise prescribing practices.

Reduce expenses associated with antibiotic inventory and related costs of maintaining inventory

Decrease C. difficile cases - 10% mortality rate and $10K per incidence cost associated with this HAI (national average)


Antibiotic Stewardship ProgramIndirect Financial Benefits

Savings and improved outcomes that influence Value-Based Reimbursements

• Avoids Unnecessary Admissions• Decreases LOS (Length of Stay)• Decreases Readmissions• Reduces risk for HAI (Hospital-Acquired

Infections)• Improves DRG Sufficiency


Antibiotic Stewardship ProgramRelated Benefits

Public Relations and Improved Perceptions

Better Patient Care

Mitigate Legal Risk

Prepare for impending CMS Conditions of Participation related to the adoption of ASPs


Antibiotic Stewardship equalsTriple Aim

1. Improves Patient Care and Outcomes

2. Reduces costs

3. Improves Health of a Community

…and it is Simply the Right Thing to Do.


Antibiotic Stewardship ProgramSelected Programs and Savings

Location/Type of Facility

Number of Beds

Cost Savings/Reductions

AS Team Composition

Monroe, Louisiana Community Hospital

120 $177,000/ 1 Year ID Specialist, Clinical Pharmacist

Dallas, Texas LTAC Hospital

60 $159,580/ 15 Months ID Specialist, Director of Pharmacy

Dorchester, Massachusetts

Community Teaching Hospital

159 $200,000-250,000/ 1 Year

ID Specialist, ID-trained Pharmacist

Baltimore, MD Large tertiary care, teaching

medical center

800 $2,949,705/ 3 Years ID Specialist, Clinical Pharmacist

Winston-Salem, NC Academic Medical

Center

880 $920,070 to $2,064,441 per year over 11 years

2 ID Specialists, 3 Clinical Pharmacists


RCRH Results

Rapid City Regional Hospital417 Licensed beds

Ernst & Young ~$1 million antibiotic per year cost savings


PYA ASP TeamOur Services

24/7 Access and Support of Infectious Disease Physician and

Team

20+ Years of ASP Experience with Proven Results

Train and Empower Physician and Pharmacy Champions

Concurrent Monitoring of Prescribing Practices

Ongoing Review and Data Analysis to Ensure Continued

Success

Transparent Reporting and Outcomes

Safety Bundle Recommendations


Public Health Crisis

…resistance to antibiotics has become a major threat to public health” World Health Organization


PYA’s ASP TEAMMultidisciplinary Expertise


“The most important weapon in your arsenal will be your ability to adapt.”


Batman

PERSHING YOAKLEY & ASSOCIATES, P.C.800.270.9629 | www.pyapc.com

James M. Keegan, [email protected]

(605) 408-6513

mailto:[email protected]