CREATING A PHYSICIAN-DRIVENHEALTHCARE FUTURE
How Physicians, Hospitals, Patients, and Payers Can All Benefit From Well-Designed Payment Reform
Harold D. MillerPresident and CEO
Center for Healthcare Quality and Payment Reform
www.CHQPR.org
I Have Nothing to Disclose
3© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
4© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #1:Which U.S. industry
has not given its key employees a raise in a decade,
and has told employees every year that their pay
may be cut by 25%regardless of how well
they’ve performed?
5© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #1:Which U.S. industry
has not given its key employees a raise in a decade,
and has told employees every year that their pay
may be cut by 25%regardless of how well
they’ve performed?
ANSWER:Health Care
6© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Medicare SGR Is Now Gone, But
Physician Pay Has Been Flat
PhysicianPractice Costs
PhysicianPaymentIncreases
If SGR CutHad Been
Made
23% EffectiveReduction
7© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #2:In which U.S. industry
can one set of employeesonly get a raise if other
employees take a pay cut,even when the business is
performing well?
8© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #2:In which U.S. industry
can one set of employeesonly get a raise if other
employees take a pay cut,even when the business is
performing well?
ANSWER:Health Care
9© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Even Without the SGR, Physician
Pay Must Be “Budget-Neutral”
PCP
Payments
Specialty
Payments
PCP
Payments
Specialty
Payments
Physician Payment Budget Neutrality
10© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #3:In which U.S. industries does government policyfavor large businessesover small businesses?
11© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #3:In which U.S. industries does government policyfavor large businessesover small businesses?
ANSWER:Health Care
12© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Unlike Physicians, Hospitals
Have Received Pay Increases
Physicians
Hospitals
Inflation
13© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #4:In which U.S. industries
are businessesonly able to sell
their products and servicesthrough an intermediary who demands large discounts andincreases prices by 18-25%?
14© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #4:In which U.S. industries
are businessesonly able to sell
their products and servicesthrough an intermediary who demands large discounts andincreases prices by 18-25%?
ANSWER:Health Care
15© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
We Spend As Much on Health
Insurance Admin/Profit as on Drugs
Admin: $110 billion
Drugs: $117 billion
16© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Lot of a Physician’s Pay Goes To
Costs of Dealing with Health Plans
Admin: $110 billion
Drugs: $117 billion
Admin: $30 billion
17© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
18© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #5:Who is to blame forthe way physicians
are paid andmicromanaged?
19© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Short Quiz
QUESTION #5:Who is to blame forthe way physicians
are paid andmicromanaged?
ANSWER:Physicians
20© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The Blame Rests With Physicians
• Physicians haven’t defined solutions to control healthcare costs without rationing
• Physicians have allowed themselves to be seen as the causes of higher spending
• Physicians haven’t defined payment models that will support lower-cost, higher-quality care and maintain financial viability for physician practices
• Physicians aren’t organized to manage and deliver high-value population health care to purchasers and patients
21© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Three Paths to the Future:
Which Door Will Doctors Choose?
TODAY
FUTURE #1
FUTURE #2
FUTURE #3
22© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Door #1: “Value-Based Purchasing”
(i.e., Pay for Performance)
TODAY
PAYER-DESIGNED
PAY FOR PERFORMANCE
23© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The Dominant Approach to
“Payment Reform” Today is P4P
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• HbA1c Control• LDL
P4P Bonus
FFS
24© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
P4P Hasn’t Worked Terribly Well
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• HbA1c Control• LDL
P4P Bonus
FFS
• A small bonus may not be enough to pay for the added costs of improving quality
• A small bonus may not be enough to offset loss of fee-for-service revenuefrom healthier patients or lower utilization
• A small bonus may not be enough to offset the costs of collecting and reporting the quality data
25© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
More Measure Burden Each Year,
With the Same Small Bonuses
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• Flu Vaccine• Tobacco Counseling
• Hypertension Control
• HbA1c Control• LDL• Eye Exams• Aspirin Use
P4P Bonus
P4P Bonus
FFS FFS
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• HbA1c Control• LDL
26© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Bonuses Turn to Penalties With
No Way to Support Better Care
P4P Bonus
P4P Bonus
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• Flu Vaccine• BMI Screens• Tobacco Counseling
• Fall Risk Assessment
• Hypertension Control
• HbA1c Control• LDL• Eye Exams• Aspirin Use
P4P Penalty
FFS FFS FFS
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• Flu Vaccine• Tobacco Counseling
• Hypertension Control
• HbA1c Control• LDL• Eye Exams• Aspirin Use
QUALITYMEASURES
• Mammograms• Colon Cancer Screening
• HbA1c Control• LDL
27© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The End of Collaboration?
• In the CMS Value-Based Payment Modifier, bonuses are only
paid to physicians who have above average quality if penalties
are assessed on other physicians with below average quality
• To maintain budget neutrality, the size of bonuses depends on
the size of penalties
• Under this system, why would high-performing physicians
want to help under-performing physicians to improve?
28© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Over-Emphasis on Narrow Quality
Measures Can Harm Patients
Hypoglycemia
1 Yr Mortality: 19.9%
30 Day Readmits: 16.3%
Hyperglycemia
1 Yr Mortality: 17.1%
30 Day Readmits: 15.3%
Source: National Trends in US Hospital Admissions for Hyperglycemia and HypoglycemiaAmong Medicare Beneficiaries, 1999 to 2011 JAMA Internal Medicine May 17, 2014
29© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Providers May Be Penalized for
Having Patients With Higher Needs
JAMA Intern Med. Published online September 14, 2015. doi:10.1001/jamainternmed.2015.4660
30© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Current Regulations Are Increasing
P4P Penalties Over Time
FFS+
PQRS+
MU+
VBM
$-4.5%+x%
FFS+
PQRS+
MU+
VBM
-6%
+x%
FFS+
PQRS+
MU+
VBM
-9%
+x%
FFS+
PQRS+
MU+
VBM
-10%
+x%
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
31© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MACRA (SGR Repeal) Slowed,
Simplified, and Balanced This
FFS+
PQRS+
MU+
VBM
$-4.5%+x%
FFS+
PQRS+
MU+
VBM
-6%
+x%
FFS+
PQRS+
MU+
VBM
-9%
+x%
FFS+
PQRS+
MU+
VBM
-10%
+x%
FFS+
MIPS
-4%
+4%
FFS+
MIPS
-5%
+5%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-7%
+7%
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
32© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
But MIPS is P4P on Steroids
FFS+
PQRS+
MU+
VBM
$-4.5%+x%
FFS+
PQRS+
MU+
VBM
-6%
+x%
FFS+
PQRS+
MU+
VBM
-9%
+x%
FFS+
PQRS+
MU+
VBM
-10%
+x%
FFS+
MIPS
-4%
+4%
FFS+
MIPS
-5%
+5%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-7%
+7%
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
MIPS
“Merit-Based
Incentive
Payment
System”
Quality
Resource Use
“Clinical Practice Improvement Activities”
EHR “Meaningful Use”
50% ->
30%10% ->
30%
25%
15%
33© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Door #2: Alternative Payment
Models
TODAY
PAYER-DESIGNED
PAY FOR PERFORMANCE
ALTERNATIVE PAYMENT
MODELS
34© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MACRA Incentives to Participate
in Alternative Payment Models
FFS+
PQRS+
MU+
VBM
$-4.5%+x%
FFS+
PQRS+
MU+
VBM
-6%
+x%
FFS+
PQRS+
MU+
VBM
-9%
+x%
FFS+
PQRS+
MU+
VBM
-10%
+x%
FFS+
MIPS
-4%
+4%
FFS+
MIPS
-5%
+5%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-9%
+9%
FFS+
MIPS
-7%
+7%
FFS+
PQRS+
MU+
VBM
$
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
-4.5%+x%
FFS+
PQRS+
MU+
VBM
-6%
+x%
FFS+
PQRS+
MU+
VBM
-9%
+x%
FFS+
PQRS+
MU+
VBM
-10%
+x%
FFS+
25%APM
+5%
FFS+
25%APM
+5%
FFS+
50%APM
+5%
FFS+
75%APM
+5%
FFS+
75%APM
+5%
FFS+
50%APM
+5%
35© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
CMS “Alternative Payment Models”
Announced To DateTYPE OF PROVIDER CMS PROGRAM PAYMENT STRUCTURE
Health Systems,Multi-Specialty Groups,
PHOs, and IPAs
Accountable Care Organizations
(MSSP & Pioneer)
FFS+
Shared Savings on Attributed Total Spending
Primary Care ComprehensivePrimary Care Initiative
FFS +
PMPM $ for Attributed Patients+
Shared Savings onAttributed Total Spending
(for State or Region)
Specialty Care Oncology Care Model
FFS+
PMPM $ for Attributed Patients+
Shared Savings on Attributed Total Spending
(for 6-month window)
Hospitals and Post-Acute Care
Comprehensive Carefor Joint Replacement
FFS+
Bonuses/Penalties on Attributed Total Spending
36© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
CMS “Alternative Payment Models”
Don’t Change FFS StructureTYPE OF PROVIDER CMS PROGRAM PAYMENT STRUCTURE
Health Systems,Multi-Specialty Groups,
PHOs, and IPAs
Accountable Care Organizations
(MSSP & Pioneer)
FFS+
Shared Savings on Attributed Total Spending
Primary Care ComprehensivePrimary Care Initiative
FFS+
PMPM $ for Attributed Patients+
Shared Savings onAttributed Total Spending
(for State or Region)
Specialty Care Oncology Care Model
FFS+
PMPM $ for Attributed Patients+
Shared Savings on Attributed Total Spending
(for 6-month window)
Hospitals and Post-Acute Care
Comprehensive Carefor Joint Replacement
FFS+
Hospital Bonuses/Penalties for Attributed Total Spending
37© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Some Provide Additional
Upfront Resources to Providers…TYPE OF PROVIDER CMS PROGRAM PAYMENT STRUCTURE
Health Systems,Multi-Specialty Groups,
PHOs, and IPAs
Accountable Care Organizations
(MSSP & Pioneer)
FFS+
Shared Savings on Attributed Total Spending
Primary Care ComprehensivePrimary Care Initiative
FFS+
PMPM $ for Attributed Patients+
Shared Savings onAttributed Total Spending
(for State or Region)
Specialty Care Oncology Care Model
FFS+
PMPM $ for Attributed Patients+
Shared Savings on Attributed Total Spending
(for 6-month window)
Hospitals and Post-Acute Care
Comprehensive Carefor Joint Replacement
FFS+
Hospital Bonuses/Penalties forAttributed Total Spending
38© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Most Only Give Providers More $
If They Reduce $ Somewhere ElseTYPE OF PROVIDER CMS PROGRAM PAYMENT STRUCTURE
Health Systems,Multi-Specialty Groups,
PHOs, and IPAs
Accountable Care Organizations
(MSSP & Pioneer)
FFS+
Shared Savings on Attributed Total Spending
Primary Care ComprehensivePrimary Care Initiative
FFS+
PMPM $ for Attributed Patients+
Shared Savings onAttributed Total Spending
(for State or Region)
Specialty Care Oncology Care Model
FFS+
PMPM $ for Attributed Patients+
Shared Savings on Attributed Total Spending
(for 6-month window)
Hospitals and Post-Acute Care
Comprehensive Carefor Joint Replacement
FFS+
Hospital Bonuses/Penalties forAttributed Total Spending
39© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Models Hold Individual Providers
Accountable for Total Cost of CareTYPE OF PROVIDER CMS PROGRAM PAYMENT STRUCTURE
Health Systems,Multi-Specialty Groups,
PHOs, and IPAs
Accountable Care Organizations
(MSSP & Pioneer)
FFS+
Shared Savings on Attributed Total Spending
Primary Care ComprehensivePrimary Care Initiative
FFS+
PMPM $ for Attributed Patients+
Shared Savings onAttributed Total Spending
(for State or Region)
Specialty Care Oncology Care Model
FFS+
PMPM $ for Attributed Patients+
Shared Savings on Attributed Total Spending
(for 6-month window)
Hospitals and Post-Acute Care
Comprehensive Carefor Joint Replacement
FFS+
Hospital Bonuses/Penalties forAttributed Total Spending
40© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
CMS Tries to Make Each Provider
Accountable for Total Spending
Spending onAll
Servicesthe
ACO’sPatientsReceive
Healthcare
Spe
ndin
g
Paymentsto
ACOs
ACOs
Spending onAll
Servicesthe
Oncologists’PatientsReceiveDuringChemo
Treatment
Paymentsto
Oncologists
OncologyCare
Model
Spending onAll
ChronicDisease
CareandCare
Related toJoint
SurgeryAfter
Discharge
Paymentsto
Hospitals
ComprehensiveCare for
Joint Replacement
Spending onAll
Servicesthe
PCP’sPatientsReceive
Paymentsto
PCPs
ComprehensivePrimary Care
Initiative
41© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
CMS Alternative Payment Models
Are Problematic for Physicians
42© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
What’s Behind Door #3?
TODAY
PAYER-DESIGNED
PAY FOR PERFORMANCE
PAYER-DESIGNED
ALTERNATIVE PAYMENT
MODELS
FUTURE #3
43© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Physicians Taking Charge of
Payment & Delivery Reform
TODAY
PAYER-DESIGNED
PAY FOR PERFORMANCE
PAYER-DESIGNED
ALTERNATIVE PAYMENT
MODELS
PHYSICIAN-DESIGNED
CARE DELIVERY &
PAYMENT SYSTEMS
44© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Physicians Are Understandably
Skeptical About “Payment Reform”
Medicare and
Health Plans
Define
Payment Systems
Physicians Have
To Change Care
to Align With
Payment Systems
Patients and
Physicians
May Not
Come Out Ahead
HOW PAYMENT REFORMS ARE DESIGNED TODAY
45© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The Right Way and Wrong Way
To Define Better Payment Models
Medicare and
Health Plans
Define
Payment Systems
Physicians Have
To Change Care
to Align With
Payment Systems
Patients and
Physicians
May Not
Come Out Ahead
Physicians
Redesign Care
and Identify
Payment Barriers
Payers Change
Payment to
Support
Redesigned Care
Patients Get
Better Care and
Physicians Stay
Financially Viable
THE RIGHT WAY TO DESIGN PAYMENT REFORMS
HOW PAYMENT REFORMS ARE DESIGNED TODAY
How Can
Well-Designed
Alternative Payment Models
Help Physicians Financially?
47© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Most of the Money in Healthcare
Doesn’t Go to Physicians
Physicians:16%
48© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Medicare Payment Silos Pit
Physicians Against Each Other
PCPPayment
Specialist
Payment
PCPPayment
Specialist
PaymentPhysician
Payment
(Part B)
49© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
All Physicians Could Earn More By
Lowering Other Healthcare Costs
PCP
Payment
Specialist
Payment
PCP
Payment
DrugCosts
Hospital &
Post-Acute
Care Costs
Specialist
PaymentPhysician
Payment
(Part B)
Total
Healthcare
Costs
(Parts A,
B, and D)
DrugCosts
(Part D)
Hospital &
Post-Acute
Care Costs
(Part A)
50© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Commonly Discussed
Alternative Payment Models
• APMs for Proceduralists (e.g., surgeons)
– Bundled payments
– Warrantied payments
– Episode payments
51© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Commonly Discussed
Alternative Payment Models
• APMs for Proceduralists (e.g., surgeons)
– Bundled payments
– Warrantied payments
– Episode payments
• APMs for Condition Specialists (PCPs, oncologists)
– Medical Homes
– Chronic Disease Management Payments
52© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Is There a Good Alternative
Payment Model for Diagnosis??
• APMs for Proceduralists (e.g., surgeons)
– Bundled payments
– Warrantied payments
– Episode payments
• APMs for Condition Specialists (PCPs, oncologists)
– Medical Homes
– Chronic Disease Management Payments
• APMs for Diagnosticians
– Fee for service + Adherence to AUC?
– Other??
The Starting Point in
Designing a Good APM:
What is the Opportunity
to Improve Care and
Reduce Spending?
54© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Proceduralists Can Reduce
Complications & Improve Efficiency
Proceduralist
High Spending on
Complications &
Post-Acute Care
Low Complication
& PAC Spending
$Hospital
55© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Procedural Episode Payments
Support Full Episode Coordination
Proceduralist
$Hospital
ProceduralEpisode High Spending on
Complications &
Post-Acute Care
Low Complication
& PAC Spending
56© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Specialists Managing a Condition
Avoid Unnecessary Procedures
Proceduralist
$
Condition
Specialist
Medical
Management
$
Hospital
ProceduralEpisode High Spending on
Complications &
Post-Acute Care
Low Complication
& PAC Spending
57© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Condition-Based Payment Supports
Good Management of the Condition
Proceduralist
$
Condition
Specialist
Medical
Management
$
Hospital
ProceduralEpisode
Condition-Based
PaymentHigh Spending on
Complications &
Post-Acute Care
Low Complication
& PAC Spending
58© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The Diagnostician Ensures the
Right Condition is Being Treated
Proceduralist
$
Condition
Specialist
Medical
Management
$
Diagnostician
Correct
Condition
Correct
Treatment
$
Hospital
ProceduralEpisode
Condition-Based
PaymentHigh Spending on
Complications &
Post-Acute Care
Low Complication
& PAC Spending
59© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Population-Based Payment Needed
to Support Good Diagnosis + Tx
Proceduralist
High Spending on
Complications
Post-Acute Care
Low Complications
Post-Acute Care
$
Condition
Specialist
Medical
Management
$
Diagnostician
Correct
Condition
Correct
Treatment
$
Hospital
ProceduralEpisode
Condition-Based
Payment
Population-Based
Payment
What Are the
Opportunities
for
Diagnosticians
in Cardiology
to Reduce Spending?
61© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
There Are Many Unnecessary
Stress Tests for Chest Pain, But…
PCPUnnecessary
Stress Tests
62© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Bigger Problem is Cascade of
Avoidable Spending for Chest Pain
PCPUnnecessary
Stress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
63© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Savings Opportunity Is Not
Just Fewer Stress Tests..
PCPUnnecessary
Stress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
AppropriateStress Tests
S
A
V
I
N
G
S
64© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Savings Comes From the Entire
“Episode” of Testing & Treatment
PCPUnnecessary
Stress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
AppropriateStress Tests
AppropriateAngiograms
AppropriateStents
S
A
V
I
N
G
S
S
A
V
I
N
G
S
S
A
V
I
N
G
S
65© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Nuclear Cardiologist Can Add
Value By Advising Not to Do a Test
PCP
AUCGuidance
fromNuclear
Cardiologist
UnnecessaryStress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
AppropriateStress Tests
AppropriateAngiograms
AppropriateStents
S
A
V
I
N
G
S
S
A
V
I
N
G
S
S
A
V
I
N
G
S
66© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Nuclear Cardiologist Helps Ensure
Patient Gets the Right CV Care
PCP
AUCGuidance
from Nuclear
Cardiologist
UnnecessaryStress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
AppropriateStress Tests
AppropriateAngiograms
AppropriateStents
S
A
V
I
N
G
S
S
A
V
I
N
G
S
S
A
V
I
N
G
S
Medical Management by
Cardiology Team
67© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Simplified Example:
Reducing Avoidable MPIsCURRENT
$/Patient # Pts Total $
Cardiologist
MPIs $80 500 $40,000
Hospital OPPS
MPIs $1,140 500 $570,000
Total Pmt/Cost 500 $610,000
Stress Testingfor Patients
• PCP practice orders nuclear stress tests for 500 patients
• Stress tests are performedin a hospital outpatientdepartment
• 15% of proceduresmay be inappropriate orunnecessary due to lackof patient risk factors orsymptoms
• (Billing for stress test codenot shown for simplicity andsince non-nuclear stresstest may be used instead)
68© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Typical Health Plan Approach:
Prior Auth/Utilization ControlsCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
MPIs $80 500 $40,000 $80 425 $34,000 -15%
Hospital OPPS
MPIs $1,140 500 $570,000 $1,140 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $518,500 -15%
69© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Under FFS, Payer Wins,
Physicians and Hospitals LoseCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
MPIs $80 500 $40,000 $80 425 $34,000 -15%
Hospital OPPS
MPIs $1,140 500 $570,000 $1,140 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $518,500 -15%
70© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A P4P Bonus to the Cardiologist
Doesn’t Offset Loss of RevenueCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
MPIs $80 500 $40,000 $84 425 $35,700 -10%
Hospital OPPS
MPIs $1,140 500 $570,000 $1,140 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $520,200 -15%
+5%
71© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Is There a Better Way?
CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
? ? ?
MPIs $80 500 $40,000 ? ? ?
Hospital OPPS ? ? ?
MPIs $1,140 500 $570,000 ? ? ?
Total Pmt/Cost 500 $610,000 ? ? ?
72© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Pay the Cardiologist to Help PCPs
Decide What Test (If Any) to OrderCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000
Hospital OPPS
MPIs $1,140 500 $570,000
Total Pmt/Cost 500 $610,000
Better Payment for Symptom Evaluation• Allow PCP to get expert advice on applying appropriate use criteria
73© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Pay the Cardiologist More to
Do the Appropriate TestsCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Hospital OPPS
MPIs $1,140 500 $570,000
Total Pmt/Cost 500 $610,000
Better Payment for Symptom Evaluation• Allow PCP to get expert advice on applying appropriate use criteria• Compensate nuclear cardiologist for evaluating appropriate cases
+25%
74© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Can We Afford to Increase
Cardiologist Pay by Nearly 40%?CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
MPIs $1,140 500 $570,000
Total Pmt/Cost 500 $610,000
Better Payment for Symptom Evaluation• Allow PCP to get expert advice on applying appropriate use criteria• Compensate nuclear cardiologist for evaluating appropriate cases
75© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Cardiologists Could Be Paid More
While Still Reducing Total $CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
MPIs $1,140 500 $570,000 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $539,500 -12%
76© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Do Hospitals Have to Lose In Order
for Physicians To Win?CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
MPIs $1,140 500 $570,000 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $539,500 -12%
Payer Wins
Hospital LosesPhysicians Win
77© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Do Hospitals Have to Lose In Order
for Physicians To Win?CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
MPIs $1,140 500 $570,000 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $539,500 -12%
What should matter to hospitals is their margin,
not their revenue (volume)
78© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Adequacy of Hospital’s Revenues
Depends On Its CostsCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
MPIs $1,140 500 $570,000 425 $484,500 -15%
Total Pmt/Cost 500 $610,000 500 $539,500 -12%
79© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
We Need to Know the Hospital’s
Fixed and Variable CostsCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000
Total Pmt/Cost 500 $610,000
80© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Now, if the Number of Tests
is Reduced…CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000 425
Total Pmt/Cost 500 $610,000
81© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Fixed Costs Will Remain the
Same (in the Short Run)…CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000 425
Total Pmt/Cost 500 $610,000
82© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Variable Costs Will Go Down in
Proportion to ProceduresCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000 425
Total Pmt/Cost 500 $610,000
83© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Let’s Increase the
Hospital’s MarginCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425
Total Pmt/Cost 500 $610,000
84© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
The Hospital Gets Less Revenue,
But a Higher MarginCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost 500 $610,000
85© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
And The Payer
Still Saves MoneyCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost 500 $610,000 $587,950 -4%
86© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
I.e., Win-Win-Win for
Physician, Hospital, and PayerCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost 500 $610,000 $587,950 -4%
Physician Wins
Payer Wins
Hospital Wins
87© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
What Payment Model Supports
This Win-Win-Win Approach?CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost 500 $610,000 $587,950 -4%
88© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
It’s Impractical to Renegotiate
Fees for Individual ServicesCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 $1,254 425 $532,950 -6%
Total Pmt/Cost 500 $610,000 $587,950 -4%
89© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Pay Based on the Patient’s
Condition, Not on the ProcedureCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice
MPIs $80 500 $40,000
Subtotal $40,000
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000
Total Pmt/Cost $1,220 500 $610,000
500 Patients with Chest Pain
90© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Plan to Offer Care of the Condition
at a Lower Cost Per PatientCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice
MPIs $80 500 $40,000
Subtotal $40,000
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000
Total Pmt/Cost $1,220 500 $610,000 $1,176 500 -4%
91© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Use the Payment as a Budget to
Redesign Care…CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice
MPIs $80 500 $40,000
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost $1,220 500 $610,000 $1,176 500 $587,950 -4%
92© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…And Let the Physicians & Hospital
Decide How They Should Be PaidCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost $1,220 500 $610,000 $1,176 500 $587,950 -4%
93© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
A Condition-Based Payment Puts
Physicians in ControlCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $100 425 $42,500
Subtotal $40,000 $55,000 +38%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Total Pmt/Cost $1,220 500 $610,000 $1,176 500 $587,950 -4%
94© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Savings Isn’t Just from Avoiding
the Test, But Downstream Costs
PCP
AUCGuidance
fromNuclear
Cardiologist
UnnecessaryStress Tests
False PositiveResults
UnnecessaryAngiograms
UnnecessaryStents
AppropriateStress Tests
AppropriateAngiograms
AppropriateStents
S
A
V
I
N
G
S
S
A
V
I
N
G
S
S
A
V
I
N
G
S
95© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
If Unnecessary PCIs Had Resulted
from the Unnecessary MPIs…CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice
MPIs $80 500 $40,000
Subtotal $40,000
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000
Avoidable PCI $7,600 4 $30,400
Total Pmt/Cost $1,220 500 $640,400
96© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Reducing MPIs Would Create
Additional Savings on PCIs…CURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice
MPIs $80 500 $40,000
Subtotal $40,000
Hospital OPPS
Fixed Costs $570 50% $285,000
Variable Costs $513 45% $256,500
Margin $57 5% $28,500
Subtotal $1,140 500 $570,000 425
Avoidable PCI $7,600 4 $30,400 $7,600 0 $0 X
Total Pmt/Cost $1,220 500 $640,400
97© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
…Bundling Procedures in Payment
Allows Doctors & Payers to BenefitCURRENT FUTURE
$/Patient # Pts Total $ $/Patient # Pts Total $ Chg
Cardiologist
AUC Advice $25 500 $12,500
MPIs $80 500 $40,000 $130 425 $55,250
Subtotal $40,000 $67,750 69%
Hospital OPPS
Fixed Costs $570 50% $285,000 $285,500 0%
Variable Costs $513 45% $256,500 $218,025 -15%
Margin $57 5% $28,500 $29,925 +5%
Subtotal $1,140 500 $570,000 425 $532,950 -6%
Avoidable PCI $7,600 4 $30,400 $7,600 0 $0 X
Total Pmt/Cost $1,220 500 $640,400 $600,700 -6%
98© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Physicians Need to Design
the Details of a Payment Model• Risk stratification of payment
– Which types of patients will need testing at a higher rate?(Cardiology is already ahead of most specialties with ACC AUC)
• Including all diagnostic options, not just one test– Nuclear testing may not be necessary, but some test may be required
• Including costs for interventional and medical cardiology– Nuclear cardiology should be part of a team approach to manage total
costs for patients, not competing for physician fees
• Including payment and decision support for PCPs– Paying for the cardiologist to respond to calls doesn’t solve the problem
if the PCPs don’t have time to make the calls
– Need to embed decision support tools in the practice, so cardiology consults can focus on the true gray areas
• Adjusting payments over time– Phasing out unnecessary fixed costs– Increasing or decreasing payments as technology changes
99© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
ACC & CHQPR Have Developed
an APM For Stable Angina
100© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
How Does All This Fit Into ACOs?
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
101© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Each Patient Should Choose &
Use a Primary Care Practice…
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
102© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLAN
…Which Takes Accountability for
What PCPs Can Control/Influence
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
AccountableMedical
Home Accountability for:• Avoidable ER Visits
•Avoidable Hospitalizations
•Unnecessary Tests
•Unnecessary Referrals
103© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLAN
…With a Medical Neighborhood
to Consult With on Complex Cases
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
AccountableMedical
Home
Endocrinology,
Cardiology,
Urogynecology
AccountableMedicalNeighborhood
Accountability for:
•Unnecessary Tests
•Unnecessary Referrals
•Co-Managed Outcomes
104© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLAN
..And Specialists Accountable for
the Conditions They Manage
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
Orthopedic
Group
OB/GYN
Group
Cardiology
GroupHeart Episode/Condition Pmt
Back Episode/Condition Pmt
PregnancyCondition Pmt
AccountableMedical
Home
AccountableMedicalNeighborhood
Accountability for:
•Unnecessary Tests
•Unnecessary Procedures
•Infections, Complications
Endocrinology,
Cardiology,
Urogynecology
105© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLAN
That’s Building the ACO
from the Bottom Up
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
Orthopedic
Group
Cardiology
GroupHeart Episode/Condition Pmt
Back Episode/Condition Pmt
AccountableMedical
Home
AccountableMedicalNeighborhood
ACO
Accountable PaymentModels
OB/GYN
GroupPregnancyCondition Pmt
Endocrinology,
Cardiology,
Urogynecology
106© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLANShared SavingsPayment
Primary
Care
ACO
Orthopedics OB/GYNCardiology
Most ACOs Today
Aren’t Truly Reinventing Care
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Fee-for-ServicePayment
Expensive IT Systems
Psych.,
Neuro
Nurse Care Managers
Share ofShared SavingsPayment??
107© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
MEDICARE, MEDICAID
HEALTH PLAN
A True ACO Can Take a Global
Payment And Make It Work
Heart
Disease
Diabetes
Back Pain
PATIENTS
Pregnancy
Primary Care
Practice
ACO
Orthopedic
Group
Cardiology
GroupHeart Episode/Condition Pmt
Back Episode/Condition Pmt
AccountableMedical
Home
Risk-AdjustedGlobal Payment
AccountableMedicalNeighborhood
OB/GYN
GroupPregnancyCondition Pmt
Endocrinology,
Cardiology,
Urogynecology
108© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
You Don’t Need a Big Health
System to Manage Global Payment
• Independent PCPs & Specialists Managing Global Payments
– Northwest Physicians Network (NPN) in Tacoma, WA is an IPA with 109 PCPs
and 345 specialists in 165 practices (average size: 2.4 MDs/practice).
NPN accepts full or partial risk capitation contracts, operates its own Medicare
Advantage plan, and does third party administration for self-insured
businesses. www.npnwa.net
– North Texas Specialty Physicians, a 600 physician multi-specialty IPA in Fort
Worth, set up its own Medicare Advantage PPO plan and uses revenues from
the health plan and capitation contracts to pay its PCPs 250% of Medicare
rates and provides high quality, coordinated care to patients. www.ntsp.com
• Joint Contracting by MDs & Hospitals for Global Payments– The Mount Auburn Cambridge IPA (MACIPA) and Mount Auburn Hospital
jointly contract with three major Boston-area health plans for full-risk capitation.
The IPA is independent of the hospital; they coordinate care with each other
without any formal legal structure. www.macipa.com
109© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Three Paths to the Future: Which
Will Nuclear Cardiologists Choose?
TODAY
PAYER-DESIGNED
PAY FOR PERFORMANCE
PAYER-DESIGNED
ALTERNATIVE PAYMENT
MODELS
PHYSICIAN-DESIGNED
CARE DELIVERY &
PAYMENT SYSTEMS
110© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
If You Want Door #3,
What Should You Do?
111© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
If You Want Door #3,
What Should You Do?
1. Continue listening to PowerPoint presentations at ASNC 2015, go back home, continue business as usual, and hope somebody else figures this out
112© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
If You Want Door #3,
What Should You Do?
1. Continue listening to PowerPoint presentations at ASNC 2015, go back home, continue business as usual, and hope somebody else figures this out
2. Plan to retire before 2019
113© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
If You Want Door #3,
What Should You Do?
1. Continue listening to PowerPoint presentations at ASNC 2015, go back home, continue business as usual, and hope somebody else figures this out
2. Plan to retire before 2019
3. Tell ASNC leadership that physician-driven payment reform is a top priority and you want to help
114© 2009-2015 Center for Healthcare Quality and Payment Reform www.CHQPR.org
Learn More About Win-Win-Win
Payment and Delivery Reform
www.PaymentReform.org
For More Information:
Harold D. MillerPresident and CEO
Center for Healthcare Quality and Payment Reform
(412) 803-3650
www.CHQPR.org
www.PaymentReform.org
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