Grand Rounds Jersey Shore Medical Center: Healthcare Reform, PCMH

1. Grand Rounds Jersey Shore Medical CenterRoad to Healthcare Reform, The Medical Home and ACOsAugust 30, 2011 Steven R Peskin, MD, MBA, FACP EVP and Chief Medical Officer MediMedia USA Associate Clinical Professor of Medicine Robert Wood Johnson Medical School

2. Road to Healthcare Reform

3. Health reform: early 20th century 1912: Theodore Roosevelt believed that no country could be strong whose people were sick and poor, campaigned on a platform that called for mandatory health insurance for workers AMA originally supported universal coverage, but by 1920, many physicians viewed compulsory insurance as threat to private practice, paternalistic, and “un-American” and AMA House of Delegates voted to oppose.

4. Health reform: mid 20th century FDR spoke in favor of a right to medical care, but did not push compulsory HI over fear that it would endanger other Social Security reforms Bill after bill introduced to mandate coverage, but none passed the Congress

5. Health reform: mid-20th century 1945: Truman proposed a single plan to provide coverage for all age groups financed by 4% rise in Social Security payroll taxes AMA raised $3.5 million to oppose the bill, calling it “regimentation” and “totalitarianism”—even though Truman had no chance of getting it through a GOP-controlled Congress

6. Health reform: the 1960s Kennedy campaigned for a comprehensive program of HI coverage for the elderly AMA established AMPAC with goal of electing conservatives to Congress and opposing Medicare

7. Health reform: the 1960s Assassination of JFK and LBJ’s ascendancy changed everything; LBJ believed in Medicare even more than JFK and knew how to get legislation through Congress 1964 elections: LBJ trounced Goldwater and the Democrats gained a 2-1 majority in Congress

8. Health reform: the 1960s 1965 Medicare and Medicaid passed, providing hospital and medical care for the elderly and creating a State/Federal partnership to cover the very poor

9. Health reform: 1970s Under Nixon, Medicare expanded to cover disabled, Wage and Price controls; beginning of limits on Medicare payments to physicians and hospitals, increased regulation of physicians and health care facilities Nixon proposed mandatory employer-sponsored HI but didn’t pass Congress

11. Sen. Kennedy offers new legislation for mandatory employer HI, government subsidies for poor, competition among private plans, and negotiated fees

13. Health reform: 1990s Rising health care costs and 46 million uninsured increased popular support for HI reform Clinton administration became the first since Truman to pursue a comprehensive plan to provide universal coverage Health Security Act called for mandated employer and individual coverage, managed competition, purchasing alliances, global budgets Plan failed to pass congressional committees

14. Health reform: late-1990s Following defeat of Clinton plan, more modest goals were set for expanding coverage, including S-CHIP program for low-income children GOP take-over of Congress led to enactment of Balanced Budget Act of 1997, which mandated cuts in payments to hospitals, physicians, other providers and new “Medicare+Choice” program—first step toward goal of privatizing Medicare

15. Health reform: early 21st century Ironically, Republican Congress passed and President George W. Bush sign into law the largest expansion of federal entitlements since 1965: Medicare Prescription Drug Program (Part D) Decision to run the program through private insurers and PBMs put a conservative “stamp” on expansion of entitlements No dedicated funding or offsets, adding to federal deficit

16. Health reform: the present Obama campaigned for universal health care coverage, 2008 elections returned the Democrats to the White House and solidified control over Congress After 18 months of contentious debate, Congress passes health care reform in March, 2010

17. Health reform: the present March 22, 2010: Almost 100 years after a U.S. President first proposed Health insurance for all, the Patient Protection and Affordable Care Act is signed into law

18. ACA: Coverage No pre-existing condition exclusions Children (2010) Adults: Temporary high risk pool (2010), then all plans must cover (2014) No rescissions (2011) Up to age 26 covered by parents’ plan (2010) Preventive services with no-cost sharing (2010 for new plans, 2014 for all HI)

19. ACA: Coverage Medicare Part D doughnut hole: $250 rebate (2010), 50% discount on brand name drugs (2011), to be completely phased out by 2020 Individual and small business tax credits applied to purchase of HI through state exchanges (2014) Qualified health plans must offer basic benefits packages: bronze, silver, gold, platinum, plus low cost-plan for under age 30 (2014)

20. ACA: Coverage Large employers must pay a penalty if their employees obtain coverage through an exchange (2014) Individuals required to buy coverage or pay penalty (2014) Medicaid expanded to 133% of FPL with 100% of cost initially paid for by federal government (2014), phases down to 90%

21. ACA: Coverage When fully implemented, 34 million previously uninsured Americans will have coverage (94% of legal residents) Half by HI offered through exchanges, half by Medicaid But most Americans will continue to obtain coverage through employer-sponsored HI

22. ACA: Workforce Primary Care Incentive Program: 10% bonus for designated services by primary care physicians (2011-2015) Medicaid primary care parity: states can pay no less than Medicare rates for visits and vaccines by primary care physicians (2013, 2014) Workforce Commission (appointed 2011, not yet funded) to project workforce needs and addresses barriers to primary care

23. ACA: Workforce Unused residency slots redistributed to primary care (2011) GME offered through Teaching Health Centers (2011) NHSC: more slots for scholarships and loan forgiveness, higher maximum awards, and part-time awards (2011) Community Health Centers (2011)

24. ACA: Workforce Title VII funding for primary care training programs, scholarships, faculty and curricula development (2011) State workforce grants (2011) State grants for primary care extension program (2011) Grants for health teams to support smaller practices become PCMHs (2011)

25. ACA: Cost and Quality Center on Medicare and Medicaid Innovation (ongoing) ACOs Bundling Other voluntary pilots to align incentives with value Must include models to reform primary care payments Pay-for-performance (ongoing) Review of Mis-valued services (ongoing)

26. ACA: Cost and Quality Insurers must spend at least 85% of premium dollar on direct patient care or pay a rebate (80% for small employers), 2011 Insurers will be required to streamline and reduce paperwork on patients and physicians, including enrollment, electronic funds transfers, and authorization requirements or pay a fine (rules to be rolled out starting in 2011)

27. ACA: Cost and Quality Patient-Centered Outcomes Research Institute (ongoing) Wellness and prevention trust fund (ongoing) National Quality Strategy (2011) Employers may offer 50% premium discount for employees who achieve personal health goals (2014)

28. How is the ACA funded? Annual fee on health insurers and excise tax on high cost health plans Excise tax on medical devices and fee on drug manufacturers Tanning salon tax Tax on earned/unearned income of higher wage persons Pay cuts to hospitals, home health and MA plans

29. Healthcare Reform and the Patient Centered Medical Home

30. The Need

31. Need for a New Healthcare Delivery Model Increasing costs Healthcare costs are growing faster than the economy and the cost of care is becoming difficult for employers, government and individuals to meet. Need to improve quality Patients receiving recommended treatment 55 % of the time Poor U.S. performance on healthcare benchmarks compared to other developed countries despite spending more. Regional variation Healthcare cost and quality vary substantially among geographic regions. Little relationship between cost and quality.

32. Need for a New Healthcare Delivery Model Inadequate response to chronic care needs Increasingly aging and chronically ill population with payment system that doesn’t recognize services found necessary for essential care e.g. care coordination, evidence-based population management, disease self management Decreased Interest in Primary Care The number of new students entering into primary care is decreasing and physicians who have chosen the field are disproportionately leaving compared to other specialties. Both domestic and international data indicating that higher proportion of primary care physicians related to higher healthcare quality and lower costs.

33. Key Elements of Patient Centered Medical Home

35. AAFP—Future of Family Medicine Project (2004) “Personal Medical Home”

36. ACP—Advanced Medical Home (2006)

37. Key elements of a PCMH are described in a March 2007 joint statement of principles from ACP, AAFP, AAP and AOA. Often referred to as the “Joint Principles”.

40. Physician who provides, manages and facilitates care

41. Care is coordinated or integrated across healthcare system

42. More accessible practice with increased hours and easier scheduling

43. Enhanced payment that recognizes the added value of delivering care through the PCMH model

44. Assistance to practices seeking transformation

46. Physician as Facilitator, Not a Gatekeeper Personal Physician Patient Pharmacist Care Specialist Care Hospital Care

48. Better communication and access

50. Prospective payment

51. Pay for outcomes

52. Team effort

53. Increased responsibility for admin and cliniciansPersonal Physician

54. PPC 1: Access & Communication (9) PPC 2: Patient Tracking & Registry Functions (21) PPC 3: Care Management (20) PPC 4: Patient Self-Management Support (6) PPC 5: Electronic Prescribing (8) PPC 6: Test Tracking (13) PPC 7: Referral Tracking (4) PPC 8: Performance Reporting & Improvement (15) PPC 9: Advanced Electronic Communication (4) TOTAL POINTS: 100 Nine Core Components

56. Demonstration Projects

57. (Patient Centered Medical Home) 6% decrease in hospital admissions 24 % decrease emergency room $500, Per member per years savings

58. Horizon Blue Cross Blue Shield/Partners In Care For the New Jersey State Health Benefits Program

59. Results: Clinical Process Metric Improvement HbA1c Testing HbA1c Testing January 2007 November2007 January 2007 November2007 Permission from Horizon Blue Cross Blue Shield and Partners in Care, Corp.

62. Marillac’s Integrated Care Patients (PCMH)

65. Initiatives to Advance Medical Homes in Medicaid/ SCHIP = Identified to have a medical home initiative Source: National Academy for State Health Policy State Scan, November 2008

66. Combined Medical Home Activity

67. Three models involve a retrospective bundled payment arrangement, and one model would pay providers prospectively Healthcare Reform: Accountable Care Organizations

68. Accountable Care Organizations “…consist of providers who are jointly held accountable for achieving measured quality improvements and reductions in the rate of spending growth.” ¹ MEDPAC Explanation: “…a group of physicians teamed with a hospital would have joint responsibility for the quality and cost of care provided to a large Medicare patient population…Potential ACOs include: integrated delivery systems, physician–hospital organizations, a hospital plus multispecialty groups, and a hospital teamed with independent practices.” ² ¹McClellan et al: Health Affairs, May 2010 ²MEDPAC June 2009 report

69. Integrated Delivery System Practice Team Physician Practice Team Practice Team Patient Physician Physician Physician Clinical Integration IndependentPractice Assoc. Practice Team Accountable Care Organization

70. Provider Organizations That Can Become ACOs

71. ACO Payment Options

72. U.S. Encourages Bundling Medicare Payments The Centers for Medicare and Medicaid invited providers on Tuesday to help develop four models to bundle payments as part of a larger effort to improve patient care and reduce costs. The program is meant to encourage hospitals, doctors and other specialists to coordinate in treating a patient's specific condition during a single hospital stay and recovery. The four models give providers flexibility on how they get paid and for which services, as well as give them financial incentives to avoid unnecessary or duplicative procedures. Three models involve a retrospective bundled payment arrangement, and one model would pay providers prospectively Applicants for these models would also decide whether to define the episode of care as the acute care hospital stay only (Model 1), the acute care hospital stay plus post-acute care associated with the stay (Model 2), or just the post-acute care, beginning with the initiation of post-acute care services after discharge from an acute inpatient stay (Model 3). Under the fourth model, CMS would make a single, prospective bundled payment that would encompass all services furnished during an inpatient stay by the hospital, physicians and other practitioners. Three models involve a retrospective bundled payment arrangement, and one model would pay providers prospectively

73. 7 Core ACO Competencies and Associated Critical Success Factors

74. 7 Core ACO Competencies and Associated Critical Success Factors

75. Three models involve a retrospective bundled payment arrangement, and one model would pay providers prospectively Thank You! Discussion