![Page 1: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/1.jpg)
1
Ascendient
The Maryland Model – Strategic Considerations for a Fixed Payment System
September 30, 2015
![Page 2: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/2.jpg)
2
www.nchastrategicpartners.org
AscendientWebinar Instructions
Webinar will begin shortly All attendees muted, in listen-only mode Submit questions through question box If a disconnection occurs, please log back in using
the access code emailed to you We are recording this webinar and will share a link
to the recorded presentation via email
![Page 3: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/3.jpg)
October 8, 2015 Webinar
The Maryland Model – Strategic Considerations for a Fixed Payment System
![Page 4: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/4.jpg)
4
Guide for Today’s Discussion
Introductions
History of Maryland Model
Current Model Structure
Initial Progress & Lessons Learned
Implications & Near-term Considerations for NC
![Page 5: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/5.jpg)
5
Our Firm:Health and Healthcare Focus
![Page 6: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/6.jpg)
6
Our Firm:Locations
National HarborMaryland
Quadrangle Office ParkChapel Hill
![Page 7: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/7.jpg)
7
Today’s Presenters
Brian Ackerman, MHA
Principal
National Harbor Office
Daniel Carter, MBA
Principal
Chapel Hill Office
![Page 8: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/8.jpg)
History of the Maryland Model
![Page 9: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/9.jpg)
9
History...the Old Model
• Maryland - Only state where hospitals (and insurers) don’t decide how much to charge for care
• Health Services Cost Review Commission – Establishes hospital rates...all payors must pay the same rate
• 26 Percent – The amount Maryland hospitals were above the national average cost per discharge in 1976
• Medicare waiver – Maryland hospitals “waived” from Federal Medicare payment models
• Criteria – Waiver to remain in place as long as: The system remains “all-payor” Inpatient payments per Medicare discharge grow
at a rate less than the nation
![Page 10: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/10.jpg)
10
The Old Model...Results
Source: Maryland HSCRC
![Page 11: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/11.jpg)
11
The Old Model...Results
Source: Maryland HSCRC
![Page 12: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/12.jpg)
12
The Old Model...Limitations for a Future Delivery System
Inpatient Only
Medicare Only
Cost per Unit/ Hospital Stay
![Page 13: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/13.jpg)
Current Model Structure
![Page 14: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/14.jpg)
14
Current Waiver...Why it Should Matter to You
![Page 15: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/15.jpg)
15
Current Waiver...Shifting Focus
Old ModelWaiver
Modernization
Inpatient Only
Care Focus All Hospital Care
Payor FocusMedicare Only All payers
Metric FocusCost per Unit/ Hospital Stay
Total Cost of Hospital Care
& Quality
![Page 16: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/16.jpg)
16
Waiver Modernization: What it Means for Maryland Hospitals
Global Payment Model linked to total hospital revenue received
from all payors
Ceiling (and floor) placed on a hospital’s total revenue based on recent top-line performance
E.g. If your total revenue was $200M last year, it will be
$200M next year...with some slight adjustments
More volume does not create more revenue...only increased expenses and lower margins
![Page 17: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/17.jpg)
17
Waiver Modernization:How Hospital Revenue is Calculated
Base Year Revenue
X Adjustments
Allowed Revenue
Global Payment Model
• Population growth
• Quality scores
• Shift to unregulated setting
• Service level changes (e.g. program closure)
• Market share changes
![Page 18: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/18.jpg)
18
Waiver Modernization:Terms of Agreement with Medicare
• Must achieve $330M Medicare savings over five years
• Maryland’s all-payer per capita total hospital cost growth limited to 3.58%...10-year CAGR for per capita GDP
• Limit total Medicare spending in Maryland to no more than national growth
• Reduce Maryland readmission rate to national average within five years...currently ranked 49 of 51 in the U.S.
• Reduce hospital-acquired conditions by 30 percent within five years
• If Maryland fails during five-year performance period, hospitals will transition to national Medicare payment systems
![Page 19: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/19.jpg)
Initial Progress & Lessons Learned
![Page 20: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/20.jpg)
20
Waiver Modernization:Recent Performance Dashboard
Source: www.mhaonline.org
Medicare savings to-date: Estimated at ~$100M
![Page 21: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/21.jpg)
21
Waiver Modernization:Additional Performance Measures
Operating profits
$71M or 15%
Operating margin 1%
# of Hospitals w/ Losses
10 to 7
Hospital Admission
s
4.1%
Potentially Avoidable Admission
s
6.0%ED Visits Flat
![Page 22: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/22.jpg)
22
What’s Changed
Increased use & availability of:
• Health coaches
• In-home post-discharge visits
• Social workers in the ED
• Transportation to primary care appts.
• Nurse hotlines
• Bedside prescription delivery
• Subsidized medicationsPriority on partnerships:
• Strengthened collaboration and coordination with primary care and SNFs
• Meaningful health coalitions
• Physician education
• Increased data sharing
Population health focus:
• Additional wellness initiatives
• Expansion of mental health & substance abuse clinics
• Use of predictive analytics
• Additional mobile clinics
![Page 23: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/23.jpg)
23
What’s Changed:Focus on Chronic Disease Management
Understanding of most at risk/costly patients In-home visits after discharge, to connect people with
needed support and resources Free or reduced-cost clinics for underserved patients with
chronic diseases (including mental health and substance abuse)
Tele-health monitoring for chronic disease management Increased community health education
![Page 24: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/24.jpg)
24
What’s Next for Maryland?
Waiver expansion...to physicians,
unregulated settings, post-acute providers
![Page 25: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/25.jpg)
Implications and Near-Term Considerationsfor North Carolina
![Page 26: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/26.jpg)
26
So...What Does it All Mean?
![Page 27: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/27.jpg)
27
Reset Your Expectations...Discharges will Continue to Decline
Current Discharges
Population Change
ACSAs PSAs Misc. Conditions Medicare Readmissions
2025 Discharges0
5,000
10,000
15,000
20,000
25,000
Dis
cha
rge
s in
Avg
. N
C M
ark
et
Growth in discharges Decline in discharges
Source: Ascendient “Healthytown” predictive modeling based on DRG-specific data from Truven
20%-
25%
![Page 28: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/28.jpg)
28
Reset Your Expectations:Healthytown 2025
A complete copy of the report can be found at:
http://ascendient.com/2015/08/healthytown-usa/
Healthytown, USATransformation of Healthcare Delivery in a Statistically Average American Community
35%ED Visits
86%Primary Care Utilization
46%
Primary Care Physician Demand
![Page 29: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/29.jpg)
29
Rethink How/Where You Will Grow
Although uncertainty around future payment methods still remains, we are clearly moving away from a system that rewards volume:
Reduced Re-admissions
Bundled Payment
ACOs or “ACO-like”
organizations
What it Looks Like
Volume Based
Outcome BasedPayment
Method
Key Implication: Most of today’s revenue centers will be tomorrow’s cost
centers
Fee-for-service
![Page 30: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/30.jpg)
30
Redefine Traditional Definitions
LEAN within our departments
LEAN-mindset across the community
Efficiency
A nice thought A requirementCollabor-
ation
Of patients/volume
Of covered livesMarket Share
As a consideration As a priorityFlexibility
Past Future
![Page 31: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/31.jpg)
31
Learn to Accept Greater Risk...Quickly!
Hospitals & Health Systems
Commercial Payors,Federal & State Payors
Risk
Where to start?1. Begin where you’re already at risk...employees, self-pay2. Leverage pilot programs, where appropriate
![Page 32: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/32.jpg)
32
Learn to Accept Greater Risk...CMS Comprehensive Care for Joint
Replacement (CCJR)
• Medicare’s first mandatory bundled payment model• Applies to hip and knee replacement patients• Will hold hospitals accountable for the quality and cost of care
through 90 days post-discharge• Applies to hospitals within 18 NC counties• At conclusion of transition period payment will be regionally
based: Within the South Atlantic, 69% of CCJR hospitals have episode
spending above the regional average*
Sources: *ww.avalere.com; ^Excerpt from Ascendient work plan
Assess Data/ Know Where you Stand
Assess Your Alternatives
Develop Your Narrow Network
Implement & Monitor
Phases of Preparation^
![Page 33: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/33.jpg)
33
So...What Should We Be Doing Today?
1. Enhance and expand collaborative efforts across the continuum
2. Know who your most at-risk patients are...establish proactive processes for intervention, follow-up, and monitoring
3. Build flexibility into new provider contracts
4. Start managing the health of those populations for which you are already at risk
5. Build your IT infrastructure:a) Can you track the cost/utilization of a patient across
your system?
b) Can you track the cost/utilization of a patient across your community?
c) Are you collecting information necessary to support future predictive analytics efforts?
![Page 34: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/34.jpg)
34
What Hospitals in NC Are Already Doing
• Developing profiles of all providers/facilities within the community and prioritizing those for collaboration
• Establishing structure to develop physician leaders... particularly within primary care
• Developing processes and structure to most fully leverage advanced care practitioners
• Piloting population health management initiatives on employees
• Centralizing services and/or reducing unnecessary duplication across the system
• Developing “Gap” assessment related to the competencies necessary for participation in a clinically integrated network
![Page 35: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/35.jpg)
35
And in Conclusion...Always Remember
![Page 36: 0 Ascendient The Maryland Model – Strategic Considerations for a Fixed Payment System September 30, 2015](https://reader037.vdocuments.site/reader037/viewer/2022103122/56649f455503460f94c66e56/html5/thumbnails/36.jpg)
36
Thank You!
Brian Ackerman
240.776.4752
Daniel Carter
919.403.3300