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Q&A: We know more about what's in a cereal box than the healthcare system, says Dartmouth-Hitchcock CEO By Modern Healthcare | March 19, 2016
Dr. James Weinstein, CEO ofDartmouth-Hitchcockhealth system in Lebanon, N.H., and a spine surgeon, was deeply involved in the deliberations leading up to theAffordable Care Act. He continues to press for delivery-system change. He recently sat down with Modern Healthcare editor Merrill Goozner to discuss the book he recently co-authored, Unraveled: Prescriptions to Repair a Broken Healthcare System, and what he sees as the next arenas ripe for reform. This is an edited transcript.
Modern Healthcare: Why do you think there's something fundamentally broken about our healthcare system? Dr. James Weinstein:There are serious issues with the health system that warrant serious solutions. At Dartmouth, for decades, we've looked at the variation in care across the country. It's our turn now to come up with solutions. We're working with colleagues across the country on projects related to what I like to call informed choice to help patients have better decisionmaking. To make informed choices, they need to be well-informed. We're working on the transparency around pricing and outcomes. It's not good enough to just say this is how much is being charged or this is how much something cost. What kind of value do you get from that charge or cost or from a procedure you might have? For value-based payments, it's critically important to have transparency about what it cost. We spent a great deal of time building an infrastructure to provide those kind of answers for our patients at Dartmouth-Hitchcock and we're working with colleagues across the nation to do the same thing.
MH: Patients tend to be more conservative if they're given a role in making the choices. How does a Dartmouth prepare for a world in which you're going to be getting less revenue? Weinstein:We must do what's right for the patient and the consumer, not what's right for Dartmouth-Hitchcock. If you start with the premise of what the patient needs and what the population needs, you might actually build your health system in a very different way. You might actually do better work and make more revenue than you do today by trying to prevent things. Today, we're paid for doing things. Imagine what we could do if we could prevent things and I didn't have to have so many hospital beds with so many sick people. We have to get upstream. We have to start dealing with our nation's greatest problems inmental illness, drug abuse, childhoodobesity. Smoking is still a problem.
MH: How does a healthcare system do that on a day-to-day basis? Weinstein:First of all, we have a strategy that deals with our organization. We take part of our investment portfolio and invest it into the populations we serve in things they need most, which aren't reimbursed well, like mental illness, like end-of-life decisions, like having the ability to make your decisions before you're going to die about how you want your life to end. We build a technology infrastructure that makes care available closer to the home. We're trying to find ways to make care consumer-friendly, not hospital-friendly. We try to find ways to work with you after you leave the hospital to keep you from coming back.
MH: You also formed an insurance arm with Harvard Pilgrim as a way of changing the reimbursement incentives inside your own system. Weinstein:We're very excited about our partnership in the insurance space. It brings us as a system into a space where we can get closer to our patients and their needs around the premium dollar. We want to lower the cost for the patient who's actually experiencing greater cost because of the change to high-deductible plans, where they have more out-of-pocket cost. We went into the market with a premium that was 15% lower than anything else in our region to lower their out-of-pocket cost upfront. Then we created networks with other partner systems so we get continuity of care where as you go from hospital to hospital, you do not have to retell the same story over and over again. We've worked to create the kind of quality of care and practices that are evidence-based across an integrated system that does the same work, has the same medical records structure, the same protocols and the same answers. But you don't have to come to Dartmouth-Hitchcock to get that. You can go to any of our partners in the health plan or in our network.
MH: Has this created conflict with physician practices or community hospitals that are excluded from your networks? Weinstein:Networks always potentially create a problem, and therein lies another important solution: being transparent about your cost and your outcomes. There should be competition. This country was built on competition. But let's put out the information about what value one organization provides against others.
MH: The overarching theme of your book is that we really have to transform the healthcare system into being patient-centered. What is the biggest problem in achieving patient-centeredness? Weinstein:The payment system interferes the most with transforming the healthcare system. Many healthcare systems are fearful that if they transform, they won't survive in a way that still provides meaningful healthcare. At Dartmouth-Hitchcock, we're trying to make a very measured approach in our population strategies to deal with those who are sickest in new and different ways. We're trying to change the services we offer and what kind of workforce offers that service. Maybe it's not a physician. It's a nurse or how we use technology. We have to figure out how to get out of the fee-for-service system and contract with patients where they don't have to provide more money out of pocket to get the services they need. The systems that have been built in this country have been built to sustain their revenue stream. It may not be the right thing for the patients. The transition is difficult. Each system has to determine how they're going to do it. Many fear that change will unravel the structure they have. We need to unravel some of them.
MH: Some would characterize efforts at delivery-system transformation over the past six years as experimental rather than transformational. Where do you see it going in the next five years? Weinstein:I think it's been disruptive. Over the next five to 10 years, what we really need to do—and I don't care what the payment system is—is have transparency about cost and outcomes. Right now, it still seems like an effort to lower the spend, not to improve the outcomes of the healthcare system and for the individual patient. We haven't transformed the system so that people actually understand what the system provides. We know more about what's in a cereal box than we do about what's in the healthcare system. We have to have that kind of cereal box explanation for every system in this country so patients can make an informed choice about their care. We can then rationally decide what we're going to spend in this country as part of our GDP—not to ration healthcare, but to rationally decide based on good information what our spend should be. http://www.modernhealthcare.com/article/20160319/MAGAZINE/303199954/we-know-more-about-whats-in-a-cereal-box-than-we-do-about-whats-in
R.I.'s Coastal Medical gets national recognition for new care model By Richard Salit Journal Staff Writer October 23. 2015 11:15PM
Rhode Island's largest group of primary care doctors has enjoyed so much success embracing a new model of care — one that is being touted by experts as a way to help cure the ills of America's health system — that it's now ranked among the best in the nation.
On Friday, Coastal Medical announced that its new approach — getting paid by insurers for how effectively it cares for its patients, not simply by billing for doctor's visits and procedures — resulted in $15.3 million in savings in 2014. Those savings are shared roughly evenly with Coastal's insurers.
One of the insurers, the federal government, has just ranked Coastal among the top 1 percent of so-called "accountable care organizations," or ACOs, in its three-year-old Medicare Shared Savings Program, created under the Affordable Care Act. Out of 333 other medical groups that have joined the program and transformed their practices, Coastal was number three in the nation on 33 quality measures.
"At a time when rising costs of health care have become such an important challenge for our state and for our nation, this is an accomplishment that is worth examining carefully, to consider what can be learned from Coastal’s experience in 2014," Dr. Al Kurose, CEO and president of Coastal, told a gathering of health leaders at the Providence Hilton on Friday.
Noteworthy among them was guest speaker Donald Berwick, former head of the U.S. Centers for Medicare and Medicaid Services and president emeritus and senior fellow at the Institute for Healthcare Improvement in Cambridge, Massachusetts. Berwick, who U.S. Sen. Sheldon Whitehouse introduced as a "Yoda-like" guru of health-care reform, is credited with coining the often-repeated term "triple aim" to describe how changes to the health-care system must focus on quality of care, the health of the nation's population, and the overall cost to the economy.
"We know what to do, but we haven't," said Berwick. "I know it's hard ... It's a bear."
Realigning a fragmented health system that is not centered on patients is difficult, he said. Coastal is doing that and serving as a national and worldwide model, he said.
"Your success is stunningly important," he said.
About 60 health officials — including physicians, insurers and government regulators — turned out to hear about Coastal's experience and to discuss the trend toward paying for "quality, not quantity," as its proponents like to say.
It's a model that has been put into practice only in the last few years and only by a limited number of medical groups, leaving some skeptics unconvinced that it can curb the soaring cost of health care while improving care.
But Kurose says Coastal's experience has been overwhelmingly positive, even resulting in the creation of 150 new positions to better manage the care of patients.
Since its founding in 1995, Coastal, which is owned and governed by physicians, has grown to 119 doctors and advanced practitioners at 20 sites across Rhode Island. It cares for 120,000 patients.
Today, three-quarters of its patients fall under shared savings contracts that insurers have struck with Coastal, beginning in 2012 with Blue Cross and Medicare.
It has taken a genuine transformation for Coastal to adapt to the new model, Kurose said. It's all about proactively managing the health of patients, especially those with diabetes, heart disease and other conditions who are at risk of costly hospitalizations and emergency room visits.
That involves coordinating the care of patients as they go between primary care doctors and specialists and as they transition between hospitals, nursing homes and rehabilitation facilities.
To do all of that has meant hiring additional staff — pharmacists to oversee the timely filling of prescriptions, nurse care managers to support patients managing chronic illnesses, and case workers to go to hospitals, nursing homes and residences to check on the well-being of patients.
To discourage patients from going to emergency rooms or clinics, the medical group established its Coastal 365 facility, which is open every day of the year, with evening and holiday hours, for sick visits for adults. A Coastal-wide electronic medical records system allows patients' care to be tracked and for patient data to be analyzed and reported to insurers.
"We believe you have to spend more to save," Kurose said.
Medicare is convinced of Coastal's success, which is why the Rhode Island medical group is among the roughly one-third of ACOs that qualified for shared savings payments. Those savings were shared with employees in the form of bonuses equal to about a weekly paycheck that were hand delivered by Coastal's executive team.
Also, the amount that Coastal received was enhanced by its performance on 33 quality measures. These relate to patient satisfaction with care, rates of readmissions to hospitals for recurring illness, management of high risk patients and preventative health efforts such as cancer screenings and vaccinations.
From 2011, before it launched its ACOs, until 2014, when the latest data was collected, Coastal saw its total costs drop 9 percent, hospital admissions plunge 28 percent, ER visits decrease 18 percent and readmissions fall 14 percent.
Meanwhile, 88 percent of female Blue Cross patients had mammograms, 80 percent of United Healthcare patients due for colonoscopies underwent the procedure, and fewer than 10 percent of Medicare patients had diabetes that was deemed "out of control."
"The data we have in hand — 'the numbers,' if you will — tell a clear and compelling story," Kurose said. "It’s a story about progressive excellence in quality of care — and a new and better experience of care for patients. It’s also a story about partnership with payers ... each of whom have worked with us to improve quality, offer new services, and lower the total cost of care. And it’s also an exciting story about jobs creation and work-force development in Rhode Island." http://www.providencejournal.com/article/20151023/NEWS/151029591
A Focus on Falls: Hospitals Push to Improve Population Health A health care system tackles an issue that has been akin to a hidden epidemic among older adults. ByChristopher J. Gearon Oct. 8, 2015
Fred Neebe of Vestal, New York, recalls going to his doctor in 2012 for a checkup and getting an unusual order. "It was a prescription to take a Tai Chi class," says the 87-year-old retired electrical engineer. The free, 12-week class offered by a local YMCA "still sticks with me," says Neebe, adding that "Tai Chi made me a lot more aware of my walking characteristics."
His doctor knew Neebe, an avid skier and hiker, previously fell and fractured his ankle. That put him at risk for another fall. That fall "was frustrating and slowed me down," Neebe says. But he was lucky, confined to a boot for a few weeks. "It could have been a lot worse," he admits.
Falling is a huge problem for adults 65 and older: "Every 13 seconds, an older adult is treated in an emergency department for a fall," says Dr. Debra Houry, director of the Center for Disease Control and Prevention's National Center for Injury Prevention and Control. "Every 20 minutes an older adult dies from a fall."
The result: lots of health care delivery innovation is occurring. One hallmark: health systems and public health departments increasingly are partnering. That's on display in Broome County. "All health care providers realize we're very costly and our efficacy is mediocre at best," Edwards notes. "We have to step back. We've learned enough about prevention."
"In many instances health departments and medical providers are in different orbits," Floyd says. "The Affordable Care Act has increased UHS' awareness of the need for population health and for increasing staffing and infrastructure to better care for patients with chronic illnesses and that are at risk."
Seeing that the falls rate was extremely high in Broome County – resulting in about a 25 percent higher death rate than the New York State average, for example – the CDC in 2010 approached Edwards about implementing proven community-based programs, like Tai Chi classes and Stepping On, an exercise and falls-education program designed for older adults. Classes were introduced in the county but Edwards knew that to make a dent, the area's largest health system needed to be on board.
In 2012, CDC looked to Broome County to help pilot a promising intervention, called STEADI, or Stopping Elderly Accidents, Deaths and Injuries. STEADI uses scientifically tested clinical interventions to help health care providers address their patients' fall risk, identify modifiable risk factors and provide effective interventions.
Edwards approached UHS' Chief Medical Officer Rajesh Davé to get UHS to implement the provider-focused, evidence-based program to prevent falls. "I told him, 'We need a champion,'" Edwards recalls. "He gave us Dr. Floyd."
Floyd knew UHS needed to be active on falls prevention. "The fastest-growing portion of the county's population is 85 and older," he notes. But looking at the intervention, he determined, "This is not going to work in the real world." The biggest hurdle: adding yet another screening to a large list of screenings – alongside pain, tobacco and alcohol use, depression and others – that primary care doctors already were shoehorning into the office visit.
He met with nursing administration and the information technology department and pulled out the essence of the algorithm, and the team fit it into clinicians' workflow. UHS had fully implemented an electronic health record system, and the most five important questions in the algorithm were teased out and put into the EHR as prompts for clinicians. If a patient responded "yes" to any questions, a trigger would pop up.
"The CDC provided us with the material and allowed us to build a system that would work," says Floyd, who tested the falls risk assessment in the Endwell clinic. The team's work enabled clinicians to incorporate the falls initiative into their work and provide patients flagged or a risk for falling with an array of interventions. This includes referring patients to evidence-based community programs like Tai Chi, prescribing Vitamin D or a cane or other walking device, reviewing medications for falls risk or providing referrals to physical therapy or to UHS' own balance program, which sends clinicians to patients' homes to help them with balance and conducting in-home assessments to reduce the risk of falls at home.
The program has been rolled out to 18 UHS sites, and through mid-September, 41,300 screenings have been conducted on 17,459 Broome County patients. The system also achieved the pay-for-performance mark set by Excellus of 75 percent of patients in need of screening received a falls assessment in the year that ended July 1, says Floyd says.
Moreover, UHS piloted STEADI for CDC, and prompted the government agency to make changes that made the fall prevention effort more sustainable at UHS.
"An important change CDC made was to develop more focused asks of providers," Houry notes. "Since providers only have a limited amount of time with each patient, we created STEADI Step One. STEADI Step One focuses on primary care physicians and asks them to conduct three screening questions and two clinical interventions for their patients 65 and older."
Neebe's internist, Frank Floyd, M.D., medical director atUnited Health Services' Endwell primary care clinic, knows all too well the bad outcomes for patients. Years ago, Floyd's grandmother fractured her hip, and "she never recovered from her injury from that fall," he says. Today, Floyd is vigilant in screening his older patients for falls risk.
Floyd's employer, the Binghamton, New York-based, 916-bed hospital and health care system UHS, is tackling an issue that has been akin to a hidden epidemic and one rarely touched by hospitals or health systems. Each year, one third of seniors fall, and falls are the leading cause of unintentional injury deaths among older adults.
And in Broome County, where Binghamton is located, the prevalence of falls was off the charts – about the highest in the state – before the nonprofit UHS put in place an evidence-based strategy in 2012 to address them. "Falls was top of the list" of problems in the county, notes Claudia Edwards, director of the Broome County Health Department.
Working with the local health department and others in the community, UHS has played a key role in significantly reducing the falls rate in Broome County by 25 percent between 2010 and 2013. Since September 2012, UHS has screened nearly 17,500 older patients for falls, along with educating and referring or providing interventions to reduce patients' risk of falling. UHS saw hospitalizations and ER visits for fall-related fractures decline 12 percent across Broome County in 18 months following implementation. As a result of UHS' success, the CDC is expanding the program nationwide.
"Screening for the risk of the problem is such a crucial aspect of the whole process," notes Edwards, adding that "it's not an easy process to pull this off."
But UHS has been able to pull it off. Falls are not an issue many hospitals and health care systems address. It's challenging, and under the traditional payment system there was no incentive to focus on fall prevention. Fixing people who had fallen is lucrative under fee-for-service medicine.
"The U.S. spends $34 billion a year on direct medical costs alone," Houry notes. "Falls also result in significant medical costs and are among the 20 most costly medical conditions." Consider that in 2012, the average cost for a hospitalization for a fall in Broome County ran $23,136; the typical ED visit for a fall cost nearly $3,000.
With the advent of Obamacare, the calculus on medical care has changed. TheAffordable Care Actput a premium on prevention and lit a match to the traditional fee-for-service system. Instead, health insurers, including Medicare and Medicaid, increasingly are putting hospitals at financial risk or creating incentives for institutions to keep people out of the hospital and avoid readmission. For example, Excellus BlueCross BlueShield has introduced a pay-for-performance incentive if 75 percent or more of UHS patients who need screening get it.
The tool not only provides a realistic tool for busy providers but "also ensures two evidence-based clinical interventions – medication review and Vitamin D supplementation – are a default in patient care," says Houry, adding "the pilot also showed us the importance of combining STEADI with the provider's electronic health record system."
"There is an administrative burden for UHS to do this," Edwards notes. In addition to modifying its IT system and redoing patient flow, UHS trained hundreds of providers. But in the changing economics of hospital care, investing in prevention and health can be the route to delivering a positive bottom line.
Thanks to the local health department's efforts to establish proven community-based programs and UHS' efforts for home-based fall prevention programs, most providers in Broome County have even more interventions for older residents at risk of falling.
"The health department set up excellent programs," Floyd says. "This is what set us apart." Since taking the Tai Chi class, Neebe has not had another fall, and he remains active.
Research has shown wide variationin per capita spending among different states and among different counties within the same state. Some of this variation can be explained by the health status of the population, local pricing, patient cultural and demographic factors, and the local liability environment.
However, the vast majority of variation in spending is unexplained and likely due to a failure of health care providers to follow established best practice guidelines. This type of variation is associated withunnecessary over-utilization, while reducing variation leads to reductions in utilization and improvements in quality.
Crystal Run Healthcarein New York State implemented a program to reduce practice variation through development of a robust best practice library grounded in published clinical guidelines and expert opinion from professional organizations. The program has allowed Crystal Run to improve quality and patient access while lowering cost for outpatient care. In doing so, it has also increased revenues for the physicians in the practice.
About Crystal Run Healthcare
Crystal Run Healthcare is a mission driven, physician-owned, multispecialty medical group with nearly 350 physicians. The practice consists of over 30 office sites across the lower Hudson Valley of New York State, extending into Manhattan. Crystal Run serves approximately 250,000 patients with a catchment area extending into four states, performing over 1,000,000 patient visits annually across 40 specialties.
In keeping with its mission to provide high-quality, patient-centered care, Crystal Run implemented electronic health records in 1999. In 2006, the group earned Joint Commission Accreditation for Ambulatory Care Services, and in 2009 it became a National Committee for Quality Assurance (NCQA) Level III Patient Centered Medical Home.
After passage of the Affordable Care Act (ACA), the organization embraced the concept of value-based payments, becoming one of the original 27 Acccountable Care Organizations (ACOs) to participate in the Medicare Shared Savings Program. Crystal Run has also engaged many of its commercial payers and managed Medicaid contracts in transitioning to shared savings, with the long term strategy of assuming full risk for its population and expanding its health insurance product, Crystal Run Health Plans.
Practice Variation Reduction At Crystal Run
Crystal Run began its practice variation reduction program with the pilot diagnosis of diabetes. There were three steps in the process.
First, the organization calculated the total cost per person per year for patients with diabetes and then segmented those costs into professional, laboratory, radiology, and procedure charges.
The second step was to compare the cost of care among the providers treating diabetes. The group did this in a transparent manner so that each physician could see how he or she compared to colleagues. The final step was to analyze the variation and determine its source.
The results of this effort are based on the set of providers who were at Crystal Run for the one year duration of the pilot. We found that variation in cost among providers was not related to severity of illness, as such variation was identical among all patients, regardless of the number of diabetic comorbidities they had (e.g., renal insufficiency, coronary artery disease, hypertension, hyperlipidemia).
Likewise, variation was not related to clinical quality; there was no correlation between the cost of care and the percentage of a provider’s patients with Hemoglobin A1c values under seven. Instead, the variation was rooted in failure to adhere to established best practice guidelines. Once providers were made aware of the evidence-based standards, saw how their individual practice style compared to their peers, and were encouraged to follow the established guideline, variation was reduced.
Reducing The Cost Of Care
As shown inExhibit 1, Crystal Run Healthcare reduced the cost of treating diabetes over a six month period by 9 percent, or almost $450,000 (standardized to Medicare dollars).The providers on the left side of the graph reduced cost by eliminating unnecessary services. The providers on the right side of the graph appropriately increased cost by addressing underutilization. However, for most diagnoses, the net effect is lower health care costs.
Building on the success of the diabetes pilot, Crystal Run‘s Clinical Transformation Officers charged every medical and surgical specialty with performing a similar exercise, instructing them to choose a diagnosis that was both common and amenable to the development of an evidence-based best practice guideline.
The 15 chosen diagnoses—listed inExhibit 2—were indeed prevalent. Approximately 97 percent of the practice’s distinct adult patients had at least one of these 15 diseases addressed during a visit in that year. Over the course of the year, variation among providers and costs was reduced for 14 of the 15 disease categories, resulting in a total savings of almost $4.2 million. The largest reductions were seen in diabetes, hypertension, hyperlipidemia, and thyroid nodules.
Divisions now meet quarterly to participate in a variation reduction exercise for the diagnosis of their choice. This has resulted in the development of dozens of new best practice guidelines that have been posted on the intranet for easy reference at the point of care.
Other recent achievements include: a 24 percent reduction in charges for iron infusions used to treat iron deficiency anemia by standardizing which intravenous formulation is administered; a 76 percent reduction in laboratory charges for dysuria in urgent care due to the creation of a urinary tract infection protocol; and, a 17 percent reduction in charges for the evaluation of abnormal liver function tests.
Improving Access And Quality
Analysis revealed that the largest source of variation for many of the target diagnoses related to professional charges. Often, this was due to differences in the average number of visits per patient per year for a given diagnosis among providers within the same specialty, and not differences in coding patterns or the distribution of new patients and consults.
In an effort to curtail this form of unnecessary variation, providers were instructed to include recommended follow-up frequency in any best practice guideline created. For some chronic conditions, such asdiabetes,hypothyroidism, andheart disease, such recommendations already existed.
For chronic conditions where practice guidelines do not take a stance regarding follow-up frequency, Crystal Run physicians chose a standardized interval by balancing expert opinion and the currently practiced standard of care in the community.
Adherence to diagnosis-specific recommendations for follow-up visits created additional capacity within the organization. For the original 15 diagnoses chosen for variation reduction, nearly 13,000 visits were eliminated between 2010 and 2012. The largest reductions were seen in diabetes, hypertension, renal masses, and chronic obstructive pulmonary disease.
A similar phenomenon was seen throughout the entire practice population, not just among patients with one of the original 15 diagnoses. Across the organization, visits per patient were reduced from 3.7 to 3.4 between 2010 and 2012. As a result, the practice eliminated 42,000 visits. These reductions have led to the capacity equivalent of 12 additional physicians, improving access for existing patients and facilitating the growth of the practice in scope and geography.
Crystal Run’s primary objective in promoting increased adherence to practice standards was to improve the quality of clinical outcomes. Since the onset of the variation reduction program, the practice has remained above the NCQA’s benchmark goals for the control of blood sugar levels in patients with diabetes and blood pressure control in patients with hypertension.
Cholesterol levels in patients with coronary artery disease and hyperlipidemia improved and surpassed the NCQA benchmark goal. Furthermore, hospitalizations per 1,000 patients for the pilot diagnosis of diabetes decreased by 15 percent for the Medicare population between 2010-2013, despite the reduction in visits per patient and reductions in cost. So reducing practice variation did improve clinical quality, and the reduction in costs and increased available capacity were simply side effects of the process.
Improving Profitability While Reducing Utilization
Between 2010, the year before the inception of Crystal Run’s variation reduction program, and 2013, overall receipts per patient were reduced by 14.5 percent, translating to a savings for payers of roughly $22.6 million. At the time, although some of the organization’s payers were transitioning to risk based contracting, the vast majority of payers continued to pay fee-for-service.
Therefore, to remain financially stable during the transition in payment models, Crystal Run Healthcare focused on filling freed capacity with new patients. The number of patients increased by 30 percent between 2010-2013, with an increase of 11.6 percent for primary care providers, 11.3 percent for medical specialties, 19.8 percent for surgeons, and 32.7 percent for OBGYNs (all data are for providers who were practicing at Crystal Run Healthcare continuously between 2010 and 2013).
At the onset of this process, some providers were concerned about reduced compensation due to reduced patient volume, particularly the procedural based specialists. However, many were hopeful that by creating new capacity, they would be able to grow panel size and care for more complicated patients, translating to increased revenue per physician.
The percentage of patients seen for a moderate or high risk visit dramatically increased between 2011 and 2013 for many of the organization’s busiest specialties, with increases of 8.5 percent for cardiology, 16.6 percent for neurology, 28.3 percent for orthopedics, 28.2 percent for pulmonology, and 62.2 percent for hematology/oncology.
The net result of growing panel sizes and caring for sicker patients is an increase in total practice receipts of 11.1 percent. Individual physician compensation has increased for most partners and employed physicians between 2010 and today, despite national trends to the contrary.
Furthermore, continuing medical education programs and adherence to best practice guidelines empowered primary care physicians to expand the initial treatment for many conditions that were once referred to procedural specialists, such as orthopedic consultation for osteoarthritis. This translated to fewer visits needed to book one procedure for these specialists, leading to increased physician satisfaction.
Crystal Run’s experience clearly illustrates that standardizing care not only reduces health care cost, but also increases a practice’s capacity to care for a growing patient population. There are several implications for policymakers and for public and private payers. First, states, particularly those concerned with physician shortages, should promote evidence-based best practice guidelines for the evaluation and treatment of chronic diseases.
Second, providers should be accountable for adherence to such guidelines through public reporting. Taking it one step further, payers could tier providers based on their ability to deliver evidence-based, standardized care, with lower copays assigned to top tier providers. Furthermore, payers should reward providers that successfully reduce variation in care by sharing in the savings achieved.
Lastly, payers should transition from a transaction based, fee-for-service payment model to one that rewards outcomes and total patients under care. Such a transition will incentivize medical practices not only to eliminate unnecessary care, but also to find innovative ways to care for patients.
Examples include telephone protocols for low-risk, sub-acute conditions such as urinary tract infections and upper respiratory infections; scheduled telephone visits or asynchronous email visits to review a diabetic’s blood sugar records; and, group visits to provide patient education for gestational diabetes or congestive heart failure.
There are many challenges that face physicians today, particularly those in independent medical practices such as Crystal Run Healthcare. However, we believe that the process of variation reduction will allow practices to achieve theTriple Aimwhile simultaneously improving their financial strength and that of the health care system in general.
Exhibit 1: Reduced Variation In Health Care Costs For Diabetes, Crystal Run Healthcare, 2010 vs. 2012
Exhibit 2: Crystal Run Healthcare Variation Reduction Program — Chosen Diagnoses
This Hospital System Now Produces More Energy Than It Consumes BY KATIE VALENTINE
Six years ago, Wisconsin's Gundersen Health System set a goal to reduce energy consumption and rely more on renewable energy. On October 14, Gundersen, which makes up a network of hospitals, medical clinics, nursing homes and other health facilities, did more than reach that goal - it successfully produced more energy than it consumed, a milestone it's kept up every day since the 14th.
The health system, which is the first of its kind to become fully energy independent, announced the success of its environmental and efficiency efforts on Monday. In its quest to achieve energy independence, Gundersen has saved nearly $2 million each year from energy conservation and efficiency efforts.
"We did not set out to be the greenest health system," Gundersen CEO Jeff Thompson said in a statement. "We set out to make the air better for our patients to breathe, control our rising energy costs and help our local economy. We believe we have made more progress on all three than anyone else in the country."
Gundersen relies on a variety of local energy sources and efficiency measures in order to produce its energy. Last year, the health care system's main campus began running a 800-horsepower biomass boiler, which burns wood chips from local suppliers to produce energy and is expected to save the health system $500,000 a year. Gundersen is also getting energy from a local landfill; the landfill produces a gas that contains methane, which is captured and pumped to a Gundersen campus for use as an energy source.
Gundersen also had solar panels installed on one of its parking decks and has helped build two local wind farms that combined produce enough energy to power 2,600 homes. The health system also uses the methane captured from the manure of 2,000 cows on three Wisconsin farms to help power its generators. The health system sells the electricity as well as the manure - which can be used as compost, bedding and fertilizer - making $2 million each year.
But the health system hasn't just focused on energy production - it's also taken steps to reduce waste. Hospitals, which rely on a variety of one-use items such as syringes and sample cups, produce 5.9 million tons of waste each year, making waste reduction a critical part of any hospital's sustainability efforts. Gundersen has reduced its hazardous and pharmaceutical waste production by 40 percent since 2010. It's also outlawed styrofoam and has reduced its food waste by 70 percent by training staff to use nearly all parts of vegetables and by donating leftover food to the Salvation Army.
Gundersen relied on savings and government grants to complete its sustainability projects, and according to Jeff Rich, executive director of Gundersen's environmental program, the health system only invested in projects that were "two-sided green - green for the environment and green for finances." The health system also relied on local partners, such as Wisconsin-based dairy company Organic Valley, which partnered with the health system to develop one of the local wind farms.
Reaching energy independence isn't easy for any building, but it's especially challenging for hospitals, which can use up to two and a half times as much energy as commercial buildings, due to high tech machinery that often needs to be kept on 24-hours a day. As extreme weather and sea level rise start to pose a major risk for hospitals, however, many are taking steps to become more efficient and more resilient to the impacts of climate change. About 200 hospitals across the U.S. use cogeneration, a cost-effective and efficient power strategy that captures heat from the energy generation process and turns it into more energy. Spaulding Rehabilitation Hospital in Boston, MA, whichopened last year, has a ground floor that's raised 30 inches above the 500-year flood level and 42 inches above the 100-year flood level, in order to help the hospital withstand sea level rise. The landscaping that surrounds the hospital helps protect it from storm surge, and its electrical equipment is on the roof, not the basement, which is susceptible to flooding. And Maine's York Hospital gets 100 percent of its energy from local, renewable sources.
How the Slowdown in Medicare Spending Is Affecting Hospitals The country's most innovative health care systems are figuring out how to do more with less -- and how to do it better. US News & World Report, 9-26-2014
It's a chicken and egg kind of question. Which came first: a slowdown in Medicare spending that will necessitate further cost cutting by hospitals and healthcare systems? Or efficiencies recently underway in many healthcare organizations leading to the slowdown in Medicare spending?
That kind dizzying circular thinking is not uncommon in today's rapidly evolving healthcare system. Throw in changes resulting from the new Affordable Care Act, 11,000 Baby Boomers signing up for Medicare every day and the fallout of a recent recession, and it's hard to sort out cause from effect simply by looking at actuarial tables.
But those tables have shown that Medicare spending has grown more slowly since 2010. A comparison of government numbers from August 2010 and April 2014 for Medicare spending found that each of the nation's 50 million elderly or disabled Medicare recipients would cost $1,000 less than was expected just four years ago. Not only that, spending is on track to be $2,400 less than expected per person by the year 2019. That doesn't translate to savings. Rather, it means the rate of growth in spending is slowing down.
But any way you slice it, the newest numbers on Medicare spending mean less money for hospitals and health care systems. The news is no doubt leading some of the country's most innovative healthcare systems to 1) be proud of themselves for their efforts to reduce costs and 2) understand that they have no choice but to keep doing what they're doing, and figure out how to do it even better.
"Our goal for the last decade has been to drive quality improvement while reducing the total cost of care," says Thomas Graf, chief medical officer for population health and longitudinal care at Geisinger Health System, which serves 2.6 million people in central and northeastern Pennsylvania. "I could argue that the improved Medicare numbers are a response to changes that we and others have made."
In 2008, the Commonwealth Fund Commission, a foundation that supports research on healthcare issues, analyzed 15 innovative healthcare systems, including Geisinger. The report looked at how Geisinger reengineered the delivery of care to improve quality, patient satisfaction and efficiency. The report found that Geisinger invested heavily in hardware, software and training to implement its electronic health record. Today, more than 3 million patient records are stored electronically, acting as a central nervous system that allows physicians, nurses, pharmacists, laboratory personnel and, in some cases, the patients themselves to see at the click of button what has been done, by whom, when it was done, and the result.
But it was change in the hands-on practice of care that produced the best results both for patients and the bottom line. Financial incentives are shifting, making it profitable to keep people healthy. Dubbed population health management, the new incentives can satisfy patients who don't get as sick as often, while cutting back on the use of expensive resources by reducing unnecessary hospital stays, avoiding duplicate tests and procedures, preventing disease and controlling chronic disease to avoid heartbreaking and costly consequences.
When Geisinger officials studied their own numbers on diabetes care, for example, they found things that could be changed within every physician's office. "We came up with things that a primary care physician could do to improve the health of their patients with diabetes," says Graf. Those things included routinely checking blood pressure, cholesterol, urine and blood; making sure patients got flu and pneumonia vaccinations; and encouraging smokers to quit. In 2004, Geisinger found that only 2.4 percent of its diabetic patients were getting all the tests, immunizations and advice that were proven to help them stay healthy.
They educated physicians and nurses about diabetic care. They added automatic reminders to electronic medical records so that providers would not forget that it was time for a patient's blood or urine test. Members of the medical team would call patients to remind them that it was time for routine tests. And the effort paid off. Today, more than 14 percent of diabetic patients get every test and reminder they need. "And those are the people who had everything on the checklist done," says Graf. "It's a long list, and now there are people who once had only one or two of the things done and are now getting four or five things done. Diabetic care improved for everybody. It really makes a difference. And it results in about a five percent reduction in the cost of care."
Healthy patients in Geisinger's system get regular attention, too. Every year around their birthday, patients get a phone call to remind them of the preventive care they'll need the next year: a mammogram, a colonoscopy, a flu or pneumonia vaccine. "Through that process, we've increased colon cancer screening by 50 percent," says Graf. "We've seen similar improvements in vaccination rates and breast cancer screening."
Such attention might seem an intrusion, compared to the laissez-faire doctoring of years past. "I think patients love it," says Richard Alan Martin, a primary care physician with Geisinger. And for Martin, this new way of doctoring--working within a team with the support he needs, electronic and otherwise, to reach out to patients to help keep them healthy--has been a life changer. "Fifteen years ago, when I was about 50, I couldn't wait to retire. This program has revitalized my career. We focus on the right thing to do for patients," he says. Now, he says he has no plans to retire.
Early in Martin's career, he acquired a practice that had been run by the same family of physicians since 1896. "I'll never forget that doctor telling me that nothing had changed in how he practiced since his grandfather had opened the office," says Martin. Looking toward the future, it's clear that a century of doing things the same old way is not in the cards for any provider or healthcare system.
There will, no doubt, be bumps in the road as providers, healthcare systems and hospitals continue to feel pressure to do more with less. Some smaller hospitals, unable to adapt, will fail. Some physicians, unwilling to delegate routine tasks to members of a team or to electronic reminders, may be tempted-as Martin once was-to retire early.
But innovative systems like Geisinger are busy anticipating trends, examining actuarial tables, studying results in their own patients, and plotting the next move that will cut costs and improve patient care. "Improving quality decreases costs," says Graf. "For us, it's been the journey of a decade."
Geisinger shares some secret sauce ingredients for making population health work November 29, 2013 by Stephanie Baum
Most providers are facing a steep learning curve to shift from fee-for-service to accountable care that the Affordable Care Act seeks. It will be a complex conversion to be sure, but some institutions such as Geisinger are helping other health systems with the conversion. In a recent webinar, Geisinger Health Plan directors shared some insights on best practices for helping providers with the transition.
Collaboration: A complex web of partnerships is at the heart of making the shift to accountable care work. The sweet spot of population health is a collaboration between payers and the clinical expertise of hospitals, according to Janet Tomcavage, Geisinger Health Plan's chief administrative offer, and Vicki Harter, director of clinical systems.
Tomcavage pointed out that physician leadership needs to be committed. After all, they are the ones who are leading the care teams of nurses, pharmacists, nutritionists and case managers. Without that commitment, making the transition to accountable care tools won't work.
Leveraging electronic health records and healthcare technology: Caradigm's Care Management tool identifies at-risk patients and enrolls them in appropriate care programs. It also helps providers develop care plans that outline problems, goals and interventions and chart their progress. It's also intended to help manage patients and conditions with interventions using real-time, event-based alerts.
Identifying and stratifying patients: By flagging up patients with chronic and complex conditions, members of the care team from case managers to physicians can identify who is most likely to be readmitted and set up a care plan to help spot problems earlier. At the same time, determining what tests or checkups healthy patients need will help spot signs of poor health earlier.
Improving transparency: This is probably one of the biggest challenges providers face since there is no one easy way for all members to understand who is intervening with the patient and when. Members of the care team such as nutritionists, pharmacists and case managers all contribute to updating this data and making it easily available.
Using telehealth: With an eye to highlighting any significant changes in patients' conditions, Geisinger is using scales embedded with Bluetooth technology for heart failure patients. That way, their weight can be tracked for any changes that might point to potential problems. It also has a new strategy to provide access to specialists from primary care offices.
Can This Be the Healthiest Place in America?
Joe Cantlupe, for HealthLeaders Media, November 21, 2013
This is population health planning. A plan, years in the making and backed by the local medical center, may make Cheshire County, NH, the healthiest community in the nation by 2020.
"Almost without interruption we had the mountain in sight before us,"-- Henry David Thoreau.
wrote about 3,165-foot Mt. Monadnock in New Hampshire, a mountain that inspired him, spiritually and physically.
At the base of Mt. Monadnock where the air and water are still clear and cool , thousands of residents, with physician and hospital support, are thinking about different mountain to climb. Their goal is to become the healthiest area in America.
Do you want to talk about population health planning? Cheshire County, NH, is exploring it big time, far beyond the four walls of its lone hospital and physician offices.
The 169-bed Cheshire Medical Center/ Dartmouth Hitchcock Keene, hospital and primary care and multispecialty clinic has sparked an initiative, dubbed Healthy Monadnock, to become the healthiest community in the nation by 2020. Cheshire County has 23 towns and is located in the southwestern corner of the state. According to the census, the county has 76,851 residents within its 729 square miles.
It's no joke. There is a concerted effort to make the Monadnock area the healthiest in the nation. The plan, years in the making, includes government and civic policy changes that officials hope will prompt its community organizations, schools, workplaces and municipalities to make healthy choices about how they eat, how they exercise, and generally take care of themselves.
Thousands of people are involved in keeping track of their own health by measuring their commitment to lose weight and get fit. While schools are revamping their menus to offer reliably nutritious fare, local planners are drawing up sketches for sidewalks and parks to encourage residents to walk and run.
Cheshire Medical Center/Dartmouth Hitchcock Keene, and local physicians are helping people "create an awareness" of their own health, says Art Nichols, the hospital CEO.
"We're not unlike a lot of other communities. We are the only hospital in our county, and we have had this partnership with physicians for 15 years," Nichols says. "When you own the market and are a significant provider, I feel there's a responsibility to that market. We don't want to wait for people to get sick and show up in our offices or emergency room. That's not enough to do our jobs."
"We want to try to help our community be the healthiest it can be, and in fact, we declared we wanted it to be the healthiest community in the country," Nichols adds.
The Healthy Monadnock 2020's activities are overseen and guided by a "healthiest community advisory board," a coalition of 30 people representing schools, private business, healthcare organizations, recreational groups, non-profit agencies, municipal and state governments.
With community 'champions' designated to help residents, the group plans to measure community progress toward achieving goals. Generally, the goals encompass what officials describe as a "broad spectrum and vision of health:"
Social factors that influence health
Education and "awareness" of healthy lifestyle behaviors
Social support network
The hospital will spend upwards of $200,000 for the program and Nichols says it's worth every penny. "There is no factor more important for health than [the] behaviors of an individual. At least 50% of a person's health is reliant on behavior and that's the whole notion of trying to create the healthiest community. So much happens outside the walls of a hospital, there's only so much a hospital can do."
Physicians have been working closely with healthcare leaders to reduce the amount of time people are spending in the hospital. Under its accountable care initiatives, the hospital has significantly reduced inpatient admissions, Nichols says.
"We got a jump on the whole notion of accountable care, and because of that, our physicians have developed some skills to keep people well and keep them out of the hospital," he says. "We've been about 50% below the national average for Medicare readmissions for some years now," Nichols says.
Economically, "the healthier patient is going to pay off" for the hospital, Nichols says. "This is a nice crossover for a healthier community as we enter the new world of (value-based care)."
Town leaders have written the "principals" of what they envision of a healthy community to be in their master plan. "They have developed streets that include sidewalks and bike lanes that aren't barriers to people [going out and walking]. And there is a lot of emphasis on local foods, and access to fruits and vegetables," Nichols says. "It sounds a little crunchy, but it's really not, it can be done."
For its work, Cheshire Medical Center/Dartmouth-Hitchcock Keene has been awarded the Carolyn Boone Lewis Living The Vision Award from the American Hospital Association reflecting the AHA's "vision of a society of healthy communities where all individuals reach their highest potential for health."
While the community is actively promoting its program, there's a way to go. Less than half of its residents-49%-know about the hospital's goals. "We know if we're going to be successful, we need everyone on board with Healthy Monadnock 2020," the hospital says.
It's a lofty goal, but 2020 is a long way off and Nichols is enthusiastic. In the meantime, the rest of America might consider doing what Cheshire County is actively trying to accomplish.
With Washington stalemated and the government's new online medical insurance exchanges trying to work out the kinks, much of the nation is fixed on the fate of Obamacare. To really understand where our health system may be headed, however, I suspect that Peter Drucker would have turned his gaze elsewhere: to ThedaCare.
ThedaCare is a community health system with more than 6,000 employees working at five hospitals and 22 clinics across Northeast Wisconsin. Over the past decade, it has established an extraordinary record of raising quality (with nearly 100% of its patients now rating their experience a 5 out of 5) while controlling the cost of inpatient care (down 25% since 2007).
The secret: ThedaCare uses Lean, a set of management principles originated by Toyota in the late 1940s to build cars.
"Believe me, nothing else works-and I've tried everything," says physician John Toussaint, ThedaCare's former chief executive who these days runs the ThedaCare Center for Healthcare Value, which he launched five years ago to help spread what he and his colleagues have painstakingly learned.
"Lean is not a program; it is not a set of quality improvement tools; it is not a quick fix; it is not a responsibility that can be delegated," Toussaint and Texas A&M professor Leonard Berry explained in a piece they wrote earlier this year in the journal Mayo Clinic Proceedings. "Rather, Lean is a cultural transformation that changes how an organization works . . . It requires new habits, new skills and often a new attitude throughout the organization."
Toussaint's a-ha moment came in 2002, when as ThedaCare's CEO he decided that he needed to look outside the healthcare sector to stimulate his thinking for how to systematically upgrade clinical performance. He visited Ariens Co., a manufacturer of snow blowers, and was stunned at what he saw: Front-line workers, teamed in small groups, were solving quality issues on the spot.
"The power they had to make radical changes to the product was just remarkable," Toussaint recalls. "I thought, 'These snow blowers are getting better care than our patients.'"Ariens was using a version of Lean. Toussaint was hooked.
As I've noted, Drucker's influence on the Toyota Production System was profound, and so it's not surprising that he would have found much to admire in ThedaCare's techniques.
For starters, ThedaCare has created a culture of continuous improvement, with staff at all levels encouraged to ceaselessly experiment and then readily adopt what works, so that the bar is perpetually being raised. "Eventually," Drucker pointed out, "continuous improvements lead to fundamental change."
Second, ThedaCare is fully focused on delivering value, which it defines as enhancing the benefits that patients receive while lessening the burdens-both monetary and nonmonetary-that they have to endure. This approach stands in stark contrast to the way that many medical providers gauge "value": health outcomes per dollars spent.
Every step in a particular process at ThedaCare-being admitted to the hospital, say-is broken down and laid out in a "value stream map" so that new efficiencies can be uncovered. "In knowledge and service work," Drucker wrote, "the first questions in increasing productivity-and working smarter-have to be, 'What is the task? What are we trying to accomplish? Why do it all?'"
The real beauty of making these maps is that it puts the patient at the center of everything. "There is no loss to the customer," Drucker pointed out, "by eliminating activities that do not add value." In the case of admissions, for example, the time it takes to be checked in to a ThedaCare facility has been cut in half.
Third, ThedaCare rallies all of its employees around a small number of well-articulated strategic objectives. Progress is measured, first and foremost, through a customer loyalty score. Meanwhile, other metrics-regarding patient and staff safety, mortality and readmission rates, employee engagement and financial stewardship-are widely broadcast and meticulously tracked. As Drucker wrote, "Information-based organizations require clear, simple, common objectives that translate into particular actions."
Fourth, ThedaCare flips the org chart on its head, with nurses and others traditionally at the bottom of the hospital hierarchy trusted-indeed expected-to do most of the innovating. Those higher up the chain, for their part, must then slide into new roles as facilitators and mentors.
This can be particularly difficult for doctors to swallow. "We're trained to be autocratic and controlling," Toussaint says. Yet Drucker considered it essential to cultivate "a managerial attitude on the part of even the lowliest worker."
Despite all the challenges, a growing number of medical institutions are going Lean. And when things click, the results are amazing. "You see the nurses and docs acting differently," Toussaint says-huddling every morning to review performance targets, troubleshooting in real time, making sure the patient remains front and center.
Even a snow blower couldn't ask for more.
September 26, 2013
Two ACOs First to Earn NCQA's Highest Grade Organizations Achieve Level 3 in ACO Accreditation
Washington, DC - Essentia Health and HealthPartners are the first two Accountable Care Organizations (ACOs) to receive NCQA's highest designation-level 3 ACO Accreditation. The two organizations were among six early adopters when the program launched in 2012.
"ACO Accreditation shows that an organization is committed to efficiency and integration, and that patients are getting the care they need," said NCQA President Margaret E. O'Kane. "I commend Essentia Health and HealthPartners for delivering on the promise of better care in all these dimensions."
"At Essentia Health, our mission is to make a healthy difference in people's lives," says John Smylie, Chief Operating Officer at Essentia Health. "ACO accreditation at the highest level by NCQA assures our patients, communities and insurers that Essentia holds itself to the highest standards of healthcare service, quality and affordability."
"Being an early adopter of the ACO program has helped us ensure that our goals as an organization are seamlessly aligned with those of our members and patients," said Beth Waterman, Chief Improvement Officer at HealthPartners. "Coordinated, accountable care is more affordable, provides a better experience to the patient, and ultimately improves patient health and well-being. That is what matters to the people we care for, and therefore is our mission every single day."
NCQA ACO Accreditation is the first evaluation program to assess organizations' ability to coordinate and deliver the care expected of ACOs. The program evaluates whether ACOs:
Ensure access to and availability of care.
Protect patient rights, including privacy.
Have a solid foundation of patient-centered primary care.
Have the necessary care management and coordination capabilities.
Monitor practice patterns and uses performance data to improve quality.
Use decision support tools to help patients and providers identify the best care.
Have necessary stakeholder participation, structure, contracting and payment arrangements.
ACOs coordinate doctors, hospitals and other health professionals to make sure people get all the care they need, while eliminating waste and inefficiency. Payments to ACOs reward quality and efficiency rather than the volume of services.
April 23, 2013
A Health Provider Finds Success in Keeping Hospital Beds Empty
CHICAGO - On a stormy evening this spring, nurses at Dr. Gary Stuck's family practice were on the phone with patients with heart ailments, asking them not to shovel snow. The idea was to keep them out of the hospital, and that effort - combined with dozens more like it - is starting to make a difference: across the city, doctors are providing less, but not worse, health care.
For most health care providers, that would be cause for alarm. But not for Advocate Health Care, based in Oak Brook, Ill., a pioneer in an approach known as "accountable care" that offers financial incentives for doctors and hospitals to cut costs rather than funnel patients through an ever-greater volume of costly medical services. Under the agreement, hospital admissions are down 6 percent. Days spent in the hospital are down nearly 9 percent. The average length of a stay has declined, and many other measures show doctors providing less care, too.
This approach is one small part of a growing effort by providers to hold down costs without restricting needed care. Nationwide, health care spending has grown over the last three years at the slowest rate since the federal government started keeping data more than 50 years ago. While the bulk of that is related to the poor economy, changes among insurers and health care providers have contributed as well. If the trend continues, even at a reduced pace, it could help alleviate Washington's long-term deficit problems and ease the strain on family budgets.
"The part that's not driven by the economy, that's the part we can theoretically control," said Drew Altman, president of the Henry J. Kaiser Family Foundation. "If we can shave even a small percentage off of it, it has a huge impact on public programs, a huge impact on premiums, a huge impact on employers."
But even as more health systems seek to replicate Advocate's early success, its experience shows just how hard it may be to expand the approach and keep medical costs from resuming their relentless rise.
"It's hard to imagine that you could start from scratch and do this and be successful in three years, said Dr. Lee Sacks, Advocate's chief medical officer, noting that other systems may find it far harder to flip the traditional fee-for-services system on its head. "We had a running head-start going back to 1995."
Nonetheless, the Affordable Care Act, President Obama's health care law, has helped encourage a shift to Advocate's payment model. Such agreements were merely a theory four years ago. But an estimated 428 accountable-care organizations now cover four million Medicare enrollees and millions more people with private insurance.
Under Advocate's deal with Blue Cross Blue Shield, certain patients are assigned to the accountable care framework - about 380,000 - and their health costs are projected. If Advocate achieves savings below that amount while meeting explicit quality targets, it splits the money with the insurer. If not, its revenue is at risk.
In some ways, accountable care resembles earlier efforts to control medical spending, including the health maintenance organizations that proliferated in the 1980s but fell out of favor, in part because they severely limited patients' choices. But accountable care differs by giving doctors and hospitals a direct financial stake in saving money and a reason to invest in various programs of preventive care rather than relying exclusively on the fees they would normally earn from providing services.
"There's an enormous amount at stake in getting these reforms to work," said Alan Krueger, the chairman of President Obama's Council of Economic Advisers.
To help control costs, Advocate has hired scores of workers to coordinate care and keep an eye on the highest-cost patients, like those who are obese or have diabetes. It started providing doctors' offices with report cards on their performance. Dozens of quality-control measures cover items as varied as blood pressure, rehospitalizations for asthma attacks or the use of expensive imaging machines.
On a blustery spring morning, those changes were visible in Advocate care centers across the metropolitan area. Sumera Khan, a clinical pharmacy specialist, popped into the hospital room of Noraine Scarpelli, an elderly woman with congestive heart failure, to check her prescription drug levels, an additional level of scrutiny that can help prevent complications. In another building, Dr. Karen O'Mara flicked between eight computer screens, peering at intensive care patients miles away, ready to alert a doctor if they looked in distress.
Advocate, a faith-based nonprofit, has an advantage over other health systems just jumping into what is more broadly known as "value-based care." In the late 1990s, well before it forged its contract with Blue Cross Blue Shield, Advocate began taking steps to control costs and improve quality. A decade ago it adopted a "clinical integration" program, requiring doctors to work together on patients in common. It was also a pioneer in the use of electronic health records.
"A lot of these early adopters were systems that were already putting things in place," said Ani Turner of the Center for Sustainable Health Spending at the Altarum Institute, a national health care research group based in Ann Arbor, Mich. "In a way, the contracts are rewarding behaviors they were already pursuing."
So far, Advocate has achieved a small but significant savings of about 2 percent below projected costs, Blue Cross Blue Shield said, but it is not clear whether it can continue to make progress. Already, some Advocate hospital chiefs have expressed fears over losing revenue and warned about the threat to their financial performance. Doctors fret that their incomes may suffer. "We're doing it because it's the right thing to do for patients," said Dr. Stuck, the Advocate family physician. "We're not making more money."
At the same time, Advocate and Blue Cross Blue Shield have no way to prevent patients that fall under the accountable-care agreement from seeing doctors outside Advocate's network. That means patients might see doctors without an incentive to cut costs as well as deliver excellent care, eroding or even erasing the cost savings the agreement achieves.
"You're trying to overlay a payment design onto a benefit model that allows a patient to go anywhere he wants," said Steve Hamman of Blue Cross Blue Shield, noting that patients can undermine the advantages of the new approach if they ignore the advice or insist on unnecessary tests and procedures. "We can talk all we want about provider accountability and how important that is. But there is a measure of patient accountability that is critical as well."
For all the obstacles, most health economists agree that accountable care organizations are one of the most promising recent developments in the giant industry. Kaufman Hall, a consulting firm that studied Advocate's results, said its research showed that the older and the bigger a value-based care system, the more capable it proved at controlling costs - and the more it was able to influence the larger community of health care providers.
"Doctors who practice with Advocate often also practice at other hospitals," said Mark Grube, Kaufman Hall's managing director. "What is occurring is that even when they are practicing at hospitals that are not under value-based contracts, they've changed how they practice. We're seeing declines in utilization there, too."
That ultimately might be what helps the accountable care model catch on and hold down spending in the longer term.
"You can see a synergy with all these initiatives," said Ms. Turner of the Altarum Institute. "There are a lot of forces out there trying to move things in the same direction."
NCQA Announces First Healthcare Provider To Receive ACO Accreditation.
Modern Healthcare (12/13, Robeznieks, Subscription Publication) reports, "Kelsey-Seybold Clinic, a Houston physician group, is the first healthcare provider to be accredited as an accountable care organization by the National Committee for Quality Assurance." The 350-doctor, 20-location clinic "was one of six organizations that first applied for ACO accreditation after the NCQA began taking submissions in March of this year." Margaret O'Kane, NCQA president said in a press release, "By being the first organization to earn NCQA ACO accreditation, Kelsey-Seybold has demonstrated to payers and other purchasers that it has met challenging requirements designed to show the efficiency, integration and high quality expected of an accountable care organization."
The Houston Chronicle (12/14, Lee) notes that O'Kane announced during the 13th annual Health Services & Outcomes Research Conference, "Kelsey-Seybold has demonstrated a real commitment to quality and value, and I believe that purchasers are looking for reassurance that they can get quality health care without paying unaffordable prices. So Kelsey-Seybold is stepping up to the plate." Spencer Berthelsen, chairman and managing director of Kelsey-Seybold, said, "With a focus on high-value care, we can reduce cost by 20 percent...this accreditation indicates we do that."
Congratulations Kelsey-Seybold on this achievement!
Better Patient Flow Boosts Physicians Group Revenue by $3.5M
Managed Contracting & Reimbursement Advisor Staff, November 13, 2012
If you want to get serious about improving revenue in your practice, you may have to consider an entire culture change. That was the experience of Atrius Health in Auburndale, Mass., the largest primary care physician group in the state, which is enjoying increased revenue of $1.75 million per year, after a gain in the first year of $3.5 million.
The improvements were the result of an ongoing cultural transformation, says Chief Medical Officer Michael Pinnolis, MD. Taking a page from Toyota Motor Group, FedEx, and the manufacturing world, Atrius is applying the tenets of Lean management to healthcare to identify and seek out waste. The results have been steady and are accelerating as more of the organization is trained. Best of all, Atrius' first-year return was achieved while simultaneously improving patient care.
By improving patient flow, the MRI suite at Atrius Health has decreased turnaround time, yielding a net gain of more than $750,000 per year and decreasing patient wait time. The endoscopy suite has improved capacity and access for patients without increasing overhead or staffing costs, which resulted in a gain of almost $1 million per year to the practice.
The effort started four years ago at Atrius's 15 practice sites in the Boston area.
"We take a lot of managed care contracts and we're at just over 50% capitated," Pinnolis says. "Something over 80% of our revenue comes from risk-based contracts, and when we looked down the road at where Massachusetts and the rest of the country were headed, we wanted to do something that would help us improve our practice efficiency and lower our medical expenses."
The solution had to include creating a system of care, Pinnolis says. The Lean methodology first promoted by Toyota seemed like the most promising avenue, and Atrius began adopting the methodology in March 2009. Lean management is a production practice that considers the expenditure of resources for any goal other than the creation of value for the end customer to be wasteful, and thus a target for elimination. Essentially, Lean management is centered on preserving value while decreasing the amount of work.
"We wanted to change the way we managed the practice and create a system based on that," Pinnolis explains. "In the beginning our physicians were almost all skeptics and wondered if it was another thing management was doing to drive the physicians crazy."
However, physicians are almost unilaterally on board now, Pinnolis says. In applying Lean management to the physician practice, Pinnolis and the other leaders had to get the frontline caregivers and other employers involved in problem solving and process improvement. Previously, upper management would address any problems that came up and pass the solution on down the line.
"That had not worked very effectively. With the new approach, we wanted to enlist the staff and their knowledge, expertise, and enthusiasm in this process of change," Pinnolis says. "Continuous improvement is a big part of Lean management, with people trying to improve processes and solve problems all the time."
Geisinger, Merck team up to make sure patients follow doctors' orders
Philadelphia Inquirer , June 20, 2012
The interests of Merck & Co. Inc. and Geisinger Health System intersect enough that the pair announced on Monday a multiyear collaboration to improve the coordination of care and get patients to take prescribed medicine more regularly than they do now.
Geisinger is a physician-led, nonprofit enterprise, based in Danville, Pa., that treats patients and provides insurance for the costs. It is often cited as one of the most innovative health-care operations in the country.
Merck, a drugmaker based in Whitehouse Station, N.J., has operations in Philadelphia's suburbs and 140 countries.
"We believe that health care is most effective when patients are active partners in their care," Glenn Steele Jr., president and chief executive officer of Geisinger Health System, said in a statement. "Our collaboration with Merck will allow both organizations to leverage our individual expertise and joint resources to improve patient engagement, including finding new interventions to increase the likelihood that patients will adhere to their treatment plans."
Neither side offered financial specifics about up-front contributions or hoped-for revenue or savings.
Mark Timney, Merck's president of global human health for the U.S. market, said in an interview that Merck would contribute millions of dollars in employee time and energy, but not product, meaning Geisinger doctors won't be obligated to write prescriptions for Merck drugs ahead of competitors.
"There is nothing specific in this contract about that," Timney said. "A big focus is adherence and this collaboration is agnostic regarding brand or company in what that solution might look like."
Getting patients to actually take medication and refill maintenance drugs - "adhere" to the doctor's prescribed plan - especially medicine for chronic diseases, can help pharmaceutical companies because it means more pills would be purchased. But plenty of health-care professionals with no particular allegiance to drug companies also say that improved adherence dramatically decreases catastrophic health events that result in emergency room visits, hospital stays, and huge costs.
Geisinger has 37 community practice sites and five hospitals (a sixth joins in July), with doctors serving patients in 31 counties in central and northeastern Pennsylvania. It is unusual in that it provides medical services and insurance.
While employing doctors, nurses, and staff to treat patients in clinics and with follow-up calls when they are at home, Geisinger also employs the accountants and actuaries of an insurer. The goal is to improve overall care for less cost than the disjointed fee-for-service system.
Theoretically, that negates, at least some of the time, expense and frustration inherent in the fee-for-service system, marked by constant reimbursement disputes between doctors and insurers with patients stuck in the middle.
About 30 percent of Geisinger patients are covered by its insurance, with patients or employers paying the insurance premium.
The other 70 percent of Geisinger patients are insured by other plans, including government plans such as Medicare and Medicaid. About 55 percent of those with Geisinger insurance see non-Geisinger doctors.
All three sets of patient populations will help test any ideas spinning out of the collaboration with Merck, said Dr. Thomas Graf, chairman of Geisinger's Community Practice.
Geisinger is also way ahead of most health-care systems in using electronic medical records, which is where Merck comes in. The collaboration will start with development of an interactive web-based application that will try to help doctors and nurses engage patients who might be at risk for developing type 2 diabetes and cardiovascular disease.
Merck has medicine for both diseases, but one of its four core strategies is to expand into complementary areas of health care.
"If the solution is successful," Timney said, "perhaps it is something we can commercialize and scale up."
Will the name Merck be on computer screens all the time, acting like advertising?
James Peters, one of the Geisinger leaders on the project, said that Geisinger respects Merck's research in this area, but that the "spirit" of the project was not to create a "Merck-specific" product, adding, "I can't imagine that would make sense."
University of Michigan business professor Erik Gordon said that with the declining access of sales representatives to doctors, Merck and other drug companies are looking for other ways to get their products in front of anyone involved in writing prescriptions.
"Unless you believe that Merck has become an philanthropic organization," Gordon said, "there is a marketing purpose behind this."
Who are the chronically costly? Health care's 1%
By Doug Trapp, amednews staff. Posted March 5, 2012.
They are older patients with cancer, diabetes, heart disease and other serious chronic conditions. Many have multiple health problems, and their relatives might not be helping with their care. Most have private insurance, are white and female.
They are the costliest 1% of patients in the U.S. Caring for them accounts for more than 20% of what the nation spends on all of its health care. In contrast, the least costly half of all patients are associated with only 3% of total health spending, according to an Agency for Healthcare Research and Quality analysis of spending data from 2008 and 2009 released in January.
An individual in the costliest bracket typically receives much of his or her care in hospitals -- sometimes in multiple hospitals in the same city. Lack of care coordination is a significant driver of this spending. These missed connections are "probably the primary reason why we cannot manage costs on people who have multiple morbidities," said Ira Klein, MD, chief of staff to the chief medical officer at the insurerAetna.
Given the stark cost imbalance, health systems, health insurers, federal agencies and state governments are paying an increasing amount of attention to these patients. Care coordination and quality improvement are part of the Obama administration's strategy for limiting the growth of national health spending. But experience has shown that those goals will not be attained easily.
Analyzing the costliest demographic
Hospitals provide a significant amount of care to the costliest 1% of patients. Inpatient care takes up three-fifths of health spending on these patients, according to the AHRQ report. That's twice the rate of the overall population, and the figure does not even include people in nursing homes or other institutional facilities.
The costliest patients, about eight out of 10 of whom are 45 or older, also use more end-of-life care than the general population, said Steven B. Cohen, PhD, author of the AHRQ brief and director of the agency's Center for Financing, Access and Cost Trends. Fewer than 1% of all people died in 2009, but the mortality rate that year for the costliest demographic was nearly 9%.
Private health insurance was the main source of coverage for roughly two-thirds of the costliest patients. Nearly all of the remainder had public coverage, and uninsured patients represented only a few percentage points, according to the report.
Patients' health status has a big influence on where they landed on the cost scale. "People with three or more chronic conditions are usually in that top 10%," said Linda Dunbar, RN, PhD, vice president of care management at Johns Hopkins HealthCare, speaking aboutHopkins' Medicaid plan. The plan has approximately 200,000 members.
Untreated mental illness also is a frequent problem for high-cost patients. Mentally ill patients often have difficulty managing their health conditions, said Michael Albert, MD, medical director for internal medicine at the East Baltimore Medical Center, part of the Johns Hopkins system. "Failure of self-management skills is the biggest issue we see."
Dr. Klein saidAetna's costliest groups of services are for care related to cardiac illnesses, cancer, orthopedic problems and women's health, including pregnancy, delivery and care of newborns.
However, Cohen noted, the report does not examine the value of the care provided to the costliest patients, so one shouldn't assume that resources used on high-cost patients have been wasted. Examining patient outcomes is necessary to get a sense of the real benefits of this care, he said.
Staying connected to patients
Increasing the coordination of care is not easy, but many health systems have made headway. Two examples are Geisinger Health System's medical home program and Johns Hopkins' system to predict health care needs.
Geisinger Health System of Pennsylvania uses medical homes and electronic medical records to improve care quality and limit duplication of services. It is a network of physicians, hospitals and a nonprofit health plan with about 270,000 members spanning 44 mostly ruralPennsylvaniacounties.
Geisinger Health Plan's sickest patients -- those with heart failure, pulmonary disease, diabetes and other conditions -- are enrolled in its patient-centered medical home program called Proven Health Navigator, said Thomas Graf, MD, Geisinger Health System's associate chief medical officer for population health.
Proven Health Navigator patients in active case management maintain close contact with their case managers, who are registered nurses. The RNs examine patients' medical and social support needs and maintain close phone contact. Some heart failure patients have remote monitoring in their homes. The machines allow them to send their weights, prescribed medications and dosages, and symptoms such as shortness of breath to their primary care teams electronically.
Dr. Graf said the medical home program is reducing Geisinger's costs by at least $1.20 for every dollar invested, in part through decreased hospitalizations. "You don't have to avoid a lot of hospitalizations to pay for these management techniques," he said.
Medicaid enrollees represent a minority of the costliest patients, according to the AHRQ report. But the most expensive Medicaid patients also tend to have multiple health problems and the least coordinated care, saidDunbar, of Johns Hopkins.
A decade ago, Johns Hopkins created a program to predict which of their Medicaid health plan members have the highest risks of serious illnesses,Dunbarsaid. The program places patients into one of five categories based on health status, social and family support, usage of health care and other variables.
"You start to treat the people differently then,"Dunbarsaid. For example, instead of waiting for high-risk patients to get sick, Johns Hopkins case managers remind these patients about recommended medical visits and arrange transportation to appointments, she said. Medium-risk patients receive lifestyle counseling, such as smoking cessation and weight loss support. She said the program has limited annual spending growth for Johns Hopkins' Medicaid plan members to 1% at a time when the national growth average has been closer to 7%.
Dual eligibles a particular problem
But Medicaid enrollees who also are eligible for Medicare are not in the risk management program,Dunbarsaid. Johns Hopkins andMaryland's Medicaid agency have not yet been able to develop a care management program for these so-called dual eligibles, many of whom consume very high amounts of health spending.
Integrating Medicare and Medicaid is complicated. Medicare has its own systems for risk adjustment, grievances and appeals, and open enrollment, said Charles Milligan, MPH, deputy secretary for health care financing at the Maryland Dept. of Health and Mental Hygiene, the state's Medicaid agency.
"None of those [Medicare standards] cleanly align with state Medicaid programs," Milligan said. Also, Medicare is more focused on treatment of acute health conditions, but Medicaid is more focused on long-term services and support.
State grants in the health reform law are supporting care coordination innovations for dual eligibles. A challenge that faced states applying for these grants was a lack of data on the Medicare services these beneficiaries receive. But the Centers for Medicare & Medicaid Services has helped states fill this knowledge gap, said Melanie Bella, director of the Medicare-Medicaid Coordination Office at theCMSCenterfor Medicare and Medicaid Innovation. The innovation center plans to use its demonstration authority to test payment models that could reduce or eliminate the incentives for cost-shifting between Medicare and Medicaid.
Persistent health system gaps
Even such innovators as Geisinger and Johns Hopkins can't coordinate health care for all of their costliest patients.
Geisinger Health System operates in areas that are near non-Geisinger physicians and hospitals. The system's ability to share patient care information with these out-of-network doctors and hospitals varies, said Melody Danko-Holsomback, RN, a Geisinger case manager. She and other Geisinger staff are working to improve these connections.
Geisinger health plan members sometimes fall between the cracks. One 57-year-old man with lung cancer who had a non-network primary care doctor visited emergency departments 41 times in a year without being admitted. He was admitted during an additional nine visits, only one of which was planned. He also saw a variety of specialists, but none of the physicians was aware of the scope of services the man received.
Danko-Holsomback said Geisinger is using the example as a case study to improve care for its seriously ill patients.
Patients themselves also have roles to play in preventing costly care, said American Medical Association President Peter W. Carmel, MD. "More than 75% of the nation's health care spending is for the treatment of chronic, often preventable conditions that can be avoided by making healthier lifestyle choices," he said. "Physicians can help the nation get the most for our health care dollar by addressing lifestyle behaviors to reduce the prevalence of chronic disease in patients, and by leading new health care delivery models that improve care coordination while reducing costs."
Dr. Albert said sometimes the level of family involvement in a patient's care is the difference between a frequent hospital visitor and a person who stays healthy. One of his patients, an 85-year-old widower, has congestive heart failure, hypertension and diabetes. The man ends up in hospitals regularly in part because he has difficulty adhering to his medication regimen. He has relatives nearby, but they are not closely involved in his care.
But another patient of Dr. Albert's -- a man with similar health problems -- stayed out of hospitals for three years in a row before he died at the age of 90. The extended run was possible because the man's wife doggedly tracked his medications and health care needs and monitored his diet.
"We called her his little pharmacist, his little nurse," Dr. Albert said.
April 4, 2012 AHIP Hi-Wire Industry Resource Guide
HealthPartners, Regions reduce preventable hospital visits
65 percent reduction in ER visits, admissions for high-risk patients
ST. PAUL, Minn. - March 30, 2012 - A new program at HealthPartners and Regions Hospital reduced preventable hospital visits by 65 percent among patients who frequently sought care in the emergency department. The program was named the Most Innovative by the Society of Hospital Medicine and was selected from among 750 abstracts to be presented at the SHM annual meeting on April 3 in San Diego.
One percent of patients, 22 percent of costs
HealthPartners and Regions Hospital implemented the program last August for more than two dozen at-risk patients. Nationally, these high-risk patients represent less than 1 percent of all patients, but they account for as much as 22 percent of all health care spending in the U.S. Research shows that a large percentage of these costs can be attributed to frequent, but often preventable use of the emergency room and hospital admissions.
Increasing access to primary care, specialists
A team of providers including nurses, social workers, physicians, physician assistants, case managers, and other staff, worked with patients to create plans that increased access to primary care providers, specialists and programs. The care plan is embedded in a patient's electronic medical record and is flagged as a high priority to ensure that the information is visible to providers and staff at HealthPartners five hospitals and 25 medical clinics who care for these patients.
Restricting narcotic medications
Narcotic medications are restricted in the ER to prevent inappropriate use except when necessary to treat medical conditions that are not related to complaints about chronic pain. Patients with suspected narcotic addiction are referred to chemical dependency treatment programs.
The HealthPartners program implemented care plans for 27 high-risk patients. Data from two months before care plan implementation were compared to data two months after implementation. The number of ER visits and hospital admissions decreased 65 percent and resulted in an estimated cost savings of $511,000.
A better approach to advanced illness, including fewer hospitalizations, could improve quality of life and satisfaction for the sickest patients - and save $25 billion in annual health-care costs, according to Gundersen Health System.
The La Crosse, Wisc.-based system is part of the Coalition to Transform Advanced Care, which aims to get more health systems to adopt programs such as caring for terminally ill patients at home instead of in hospitals. Gundersen outlines such programs in a new book, Having Your Own Say, which advocates helping patients and families prepare for end-of-life decisions, and avoiding unwanted treatments while providing comfort and pain relief.
Gundersen's Respecting Choices program is hailed as a model by the coalition, which includes health-care providers, medical societies and patient-advocacy groups. In the book, available for $19.95, Gundersen experts outline how hospitals, insurers, and patients and their families can work together to make sure people with advanced illness get the quality of care they want and have their wishes for treatment respected. (The book is published by the Center for Health Transformation, founded by former House Speaker and White House hopeful Newt Gingrich.)
Bernard Hammes, director of the Respecting Choices program and Gundersen's Medical Humanities program, says that the health system and others such as Sacramento, Calif.-based Sutter Health have shown that helping patients better manage illness at home reduces the number of health crises requiring hospitalization. That's where the cost savings come in.
"Rather than forcing patients into an acute-care hospitalization or sending them to hospice, we can provide a higher level of service at less cost in their home setting through nurse-care coordinators and telephonic support," Hammes says. "But it has to start with a good planning process so we can determine how best to care for patients as their illness advances over time."
Part of the program includes having patients and physicians fill out a form known as a POLST - for Physician Orders For Life Sustaining Treatment. This is an initiative being adopted in a growing number of states that lets people with advanced illness nearing the end of life make decisions such as whether they want life-sustaining treatments on a mechanical breathing machine.
While providing palliative care is a central part to any plan, people mistakenly equate the term with end-of-life care in a hospice, Hammes says. Hospice care, particularly for Medicare beneficiaries, is largely restricted to patients with a prognosis of living six months or less, and who agree to forgo attempts to cure their disease to instead focus on comfort and quality of life. Palliative care provides pain and symptom management, and discussions about advance-care planning, but also has life-prolonging and curative therapies.
"The ultimate aim is to make sure patients receive treatment they want based on truly informed decisions and avoiding over- or under-treatment," Hammes says. "It's about quality of living as defined by each individual and for families, it's about making sure their loved one's wishes are known and followed."