designing successful strategies and alliances. clinical quality – integrity – service excellence...
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Designing Successful Strategies and Alliances
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 2
Agenda
PartnershipsOverview ImplicationsPopulation
Health
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 3
Macro Context
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000US NORSWIZ NETHCAN DENGER FRSWE AUSUK NZJPN
Per capita spending on healthcare
• 30% of retiree discretionary spending by 2025
• $1,400 per car for General Motors
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 4
Underlying Drivers
• Minimal incentives
• Consolidation
• Price opacity
• Technology
• Lifestyle
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 5
Market Reaction
• Risk bearing groups
• ACOs
• Transparency tools
ASCs general benefit high-quality, low-cost provider by health plans and risk bearing medical groups
• Cost sharing
• IP OP shift
• High deductible plans
• Provider & health plan consolidation
• Vertical integration
• Technology
Inflationary Deflationary
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 6
ASC Market Forces
• Hospital & MD group consolidation
• Referral patterns changing
• Reimbursement pressure
• Impact of exchanges
• Narrow networks & risk models
• Growing threats & growing opportunities
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 7
Agenda
PartnershipsOverview ImplicationsPopulation
Health
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 8
Context
• Trend is towards three types of control: health system, payer, and/or MD group
• Tend to be driven by:
• Alignment of PCPs
• HMO / MA penetration
• Strategy of major payers
• Vision / strategy of health systems
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 9
Implication
• Strategic partnerships becoming more important
• Starts with assessment of market
• Where is market heading?
• Who will winner(s) be?
• What is optimal strategic partnership?
• Then, long process to cultivate partnership
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 10
Example: Health System
• Clinical quality
• Specialist alignment
• Market share
• Lower cost network
• One of two largest health systems in DFW
• Employing / aligning with PCPs
• Developing risk models
Partner’s Focus Areas
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Example: Payer
• Clinical quality
• Total medical cost
• Foster independent community
• Customer pressure
Partner’s Focus Areas
• Mountain state BCBS plan
• Strategic focus on reducing cost of care
• Active interest from employer ASO clients
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Example of Payer Focus
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 13
Example: Medical Group
• Clinical quality
• Total medical cost
• Member experience
• Physician alignment
Partner’s Focus Areas
• 1,500 physician medical group in Orange County
• Taken risk on MA and commercial for 20+ yrs
• Acquired by Optum three years ago
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 14
Agenda
PartnershipsOverview ImplicationsPopulation
Health
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 15
Population Health
Medical/Other$202
Surgery$92
Inpatient $281
OP-Eligible IP$131
Outpatient & Office
$501
Optimal Setting
$18
OP-Eligible IP$10
Higher Cost Setting – Existing
Outpatient$35
PM
PM
($
)
$45 PMPM of addressable
spend
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 16
Medicare Advantage Analytics
ORT (154)
PAIN (449)
OTH (103)
GST (3,991)
OPT (2,361)
0%
20%
40%
60%
80%
100%
91%63% 55% 45%
7%
9%37% 45% 55%
93%
Hospital ASC
Endoscopy Center
Opportunity by specialist
Site of service optimization could bend outpatient surgical spend by $19 PMPM
(~200 bps or more reduction in MLR)
Surgeon A (GST)
Surgeon B (GST)
Surgeon C (GST)
Surgeon D (GST)
Surgeon E (GST)
Surgeon F (GST)
Surgeon G (OPT)
Surgeon H (GST)
Surgeon I (OPT)
Surgeon J (GST)
$-
$10,000
$20,000
$30,000
$40,000
$50,000
$60,000
$70,000
020406080100120140160180200Opportunity $ (Primary) Opportunity Cases (Secondary)
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Medicare Advantage Analytics
Site of Service Utilization by Specialist
Specia
list A
Specia
list B
Specia
list C
Specia
list D
Specia
list E
Specia
list F
Specia
list G
Specia
list H
Specia
list I
Specia
list J
020406080
100120140160180200
Unneccessary HOPD Cases Clinically Necessary HOPD Cases ASC Cases
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Surgery Center Analytics
Highest Total Spend Items
Item DescriptionAnnualized
Spend Current Price MD #15 MD#25 MD#34 MD#49 MD#64phaco pack (P) $17,806 $29 101% 100% 100% 100% 100%helon 5 (P) $15,165 $45 0% 104% 103% 0% 82%VIGAMOX 0.5% 3ML DROPTAINER (C) $12,144 $26 99% 84% 83% 0% 82%helon 0.55 (P) $10,248 $24 113% 9% 16% 120% 151%BREVITAL 500MG 1VL C4 (C) $10,144 $38 1% 73% 77% 51% 7%eye packs (P) $9,247 $15 101% 100% 99% 100% 98%TOBRADEX 0.3-0.1% 3.5GM OPTH (C) $5,724 $36 71% 0% 3% 0% 47%ZYMAR 0.3% 5ML OPTH (C) $4,662 $14 0% 112% 107% 0% 27%Solution, Intraoccular Irrigation, BSS(R) (Balanced Salt Solution), Sterile, (S)$4,199 $5 99% 103% 99% 100% 100%CYCLOMYDRIL 1-0.2% 5ML OPTH (C) $3,483 $6 67% 93% 88% 3% 404%COLLAGEN CORNEAL SHIELD (P) $3,121 $10 0% 100% 100% 0% 36%Drape, Eye-Pak Ophthalmic Drape, Micro-Embossed Plastic, Aperture, Mid-Size, (S)$2,709 $6 0% 100% 99% 103% 100%Solution, Ophthalmic Viscoelastic VISCOAT .75 mL (S) $1,645 $47 1% 9% 9% 0% 18%NEOMYC/POLY/DEX 0.1% 3.5GMOPTH (C) $1,115 $3 0% 100% 98% 100% 24%Catheter, IV, Introcan Safety, Winged, Polyurethane, 22g x 1in (S) $1,112 $2 98% 99% 96% 99% 93%Stab Knife 15 degree-Stylus $1,076 $31 19% 0% 0% 0% 0%
$1,073 $83 7% 0% 0% 0% 0%$1,006 $5 100% 0% 0% 0% 0%
Highest Total Spend Items
Item Description Current Price MD #15 MD#25 MD#34 MD#49 MD#64phaco pack (P) $17,806 $29 101% 100% 100% 100% 100%helon 5 (P) $15,165 $45 0% 104% 103% 0% 82%VIGAMOX 0.5% 3ML DROPTAINER (C) $12,144 $26 99% 84% 83% 0% 82%helon 0.55 (P) $10,248 $24 113% 9% 16% 120% 151%BREVITAL 500MG 1VL C4 (C) $10,144 $38 1% 73% 77% 51% 7%eye packs (P) $9,247 $15 101% 100% 99% 100% 98%TOBRADEX 0.3-0.1% 3.5GM OPTH (C) $5,724 $36 71% 0% 3% 0% 47%ZYMAR 0.3% 5ML OPTH (C) $4,662 $14 0% 112% 107% 0% 27%
$4,199 $5 99% 103% 99% 100% 100%CYCLOMYDRIL 1-0.2% 5ML OPTH (C) $3,483 $6 67% 93% 88% 3% 404%COLLAGEN CORNEAL SHIELD (P) $3,121 $10 0% 100% 100% 0% 36%
$2,709 $6 0% 100% 99% 103% 100%Solution, Ophthalmic Viscoelastic VISCOAT .75 mL (S) $1,645 $47 1% 9% 9% 0% 18%NEOMYC/POLY/DEX 0.1% 3.5GMOPTH (C) $1,115 $3 0% 100% 98% 100% 24%Catheter, IV, Introcan Safety, Winged, Polyurethane, 22g x 1in (S) $1,112 $2 98% 99% 96% 99% 93%Stab Knife 15 degree-Stylus $1,076 $31 19% 0% 0% 0% 0%
$1,073 $83 7% 0% 0% 0% 0%$1,006 $5 100% 0% 0% 0% 0%
Frequency of Utilization by Physician
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 19
Agenda
PartnershipsOverview ImplicationsPopulation
Health
Clinical Quality – Integrity – Service Excellence – Teamwork – Accountability – Continuous Improvement 20
Implications
• Markets trending towards three types of control: health system, payer, MD group
• Strategic partnerships are, therefore, becoming more important
• These partnerships are complex, and, if structured well, highly valuable