The APM Framework and Progress Tracking Work Group met for the first time in person on August 27 in McLean, Virginia. The day-long meeting focused on the group’s first objective of developing and proposing a framework for categorizing APMs. The group discussed leveraging the categorization framework developed by CMS as a baseline and identified potential refinements. Additional considerations were raised around whether to recommend approaches to linking payment decisions to performance on quality metrics, whether to recommend approaches to cost measurement, and how the framework should account for the intensity of incentive payments. In the coming months, the group will reach out to LAN participants for comments and suggestions on a draft white paper detailing its recommended framework.
The group also discussed methodologies currently used for measurement and tracking of payment reform and identified factors to consider when proposing a methodology and process for tracking the progress of APM adoption across the U.S. health care system. Factors discussed include how stringently the data should be validated, whether tracking should be conducted in terms of patients, providers, and dollars associated with APM, how to avoid double-counting members participating in an APM, and how frequently plans and providers will be asked to report data. The next in-person group meeting will be in the Washington, D.C., area this fall. A full summary of the August 27 meeting will be posted online in the near term.
Since our last webinar, the Guiding Committee had a conference call to review progress and developments for each of the LAN’s three work groups, and the APM Framework and Progress Tracking Work Group held its first in-person meeting to identify a framework for categorizing APMs. LAN Guiding Committee Co-Chair Mark Smith will share updates on these activities during our September webinar.
You will also learn how a large insurer, Blue Shield of California; a physician group, Hill Physicians Medical Group; and a hospital system, Dignity Health, are collaborating on a virtual ACO model for approximately 41,000 employees who receive coverage through CalPERS. These organizations share information and coordinate care to improve quality, cost, and service. Disease management, pharmacy, improved communication, and palliative care all play a role in this model. Hear an interactive panel moderated by LAN Project Leader Anne Gauthier that includes perspectives from Kristen Miranda, Senior Vice President, Strategic Partnerships and Innovation of Blue Shield of California, Rosaleen Derington, Chief Medical Services Officer of Hill Physicians Medical Group, and Cheri Galt, Director, Managed Care of Dignity Health.
The PBP work group will focus on payment models wherein groups of providers are held jointly accountable for achieving measured quality improvements and costsavings for a defined population, (as opposed to the delivery system reforms needed to implement and sustain successful models).
The group’s primary task is to populate a PBP “component matrix” to establish clear payment standards for PBP models operating in the public and private sectors. The group will not dictate the way that PBP models should be designed but rather achieve consensus on concrete features of PBP models where the benefits of alignment clearly outweigh the costs of limiting design flexibility. Standardization is intended to promote alignment in the public and private sectors to help PBP models succeed, while still providing the discretion needed to succeed in a variety of other dimensions.
The group will also consider multiple dimensions of consumer engagement, including: (1) consistent and comparable public reporting on cost and quality measures (2) linkages to attribution and involving consumers on the selection of the PBP models to which they are enrolled; (3) consumer education; and (4) incentives for consumers such as reduction in copays.
Clinical Episodes Payment (CEP) Work Group
The group’s scope encompasses a few clinical conditions: joint replacement, maternity care, and cancer care. The intent is to obtain the commitment of 5-10 payers and/or providers to align efforts around one or more of these episodes and implement a clinical episode payment initiative. The work group will define best practices and key components for alignment and may also define a set of conditions or episodes beyond the initial set around which future efforts should be aligned and models created.
The work group plans to take an analytical approach to definition of terms (such as “episode”), control/ accountability of bundles, benchmarking, performance measurement, prospective vs. retrospective payment flows, data flows, and interactions with data reforms.
The work group goals include:
making 50% of payments in the group’s chosen method within two years of finalization.
obtaining commitments from 5-10 large payers and 5-10 large provider systems to begin to experiment with the findings from this process within one year of finalization.
obtaining agreement from members of the LAN or commercial payers to require or allow bundled payment for the episodes identified through this work.
The LAN Guiding Committee held its fourth meeting by teleconference on August 14, with a focus on guidance to the soon-to-be established work groups, strategies for engaging with and leveraging stakeholder activities, and firming up plans for a LAN in-person meeting.
Sam Nussbaum, chair of the APM Definitions and Progress Tracking Work Group, provided a recap of the July 31 meeting in which the group affirmed the need to ensure the greatest amount of consistency possible in the way that alternative payment models are conceptualized and categorized. The group also decided to use the four-category APM framework developed by CMS as a starting point, and to introduce further refinements over the course of subsequent discussions. Nussbaum described the agenda for the in-person meeting (see page 1) and said a draft set of recommendations, based on the meeting discussions, will be delivered two weeks following that meeting.
The co-chairs and members continued to discuss initial guidance being provided to two new work groups (see sidebar). Guiding Committee members also discussed the principles drafted to channel work group efforts.
The co-chairs described a potential collaborative activity around core quality measures that would build on existing work and not duplicate the work of others. Members agreed the LAN should emphasize work that accelerates the development of new measures that are more clinically meaningful and also meaningful to patients.
Finally, members discussed the strategy of leveraging Guiding Committee member networks and plans for the LAN Summit.
LAN Learnings in August, the third in the monthly series, attracted over 600 participants. LAN Guiding Committee Co-Chair Mark Smith highlighted outcomes from the July 31 APM Framework and Progress Tracking Work Group Kick-off Meeting where members wrestled with the question of what are the two or three essential elements that need to be incorporated into an APM Category Framework.
Mark Smith also summarized plans for two additional work groups, a Population-Based Payment (PBP) model work group, anticipated to launch this September, and a Clinical Episodes Payment (CEP) Model work group, anticipated to launch in October.
After the Guiding Committee report, Amy Bassano, Director of Patient Care Models Group, Centers for Medicare & Medicaid Services (CMS), presented on the Bundled Payments for Care Improvement (BPCI) initiative. This initiative, consisting of four models, targets 48 conditions with a single payment for an episode of care and incentivizes providers to take accountability for both cost and quality of care. Amy discussed the five most prevalent clinical episodes in three of the four models currently being tested in BPCI and highlighted evaluation results from BPCI’s Retrospective acute care hospital stay plus post-acute care model and BPCI’s Retrospective post-acute care only model. More information on the BPCI initiative can be found here.
Gabriel Scott, Lead, Comprehensive Care for Joint Replacement at CMS then presented on this model, which would test bundled payments for lower extremity joint replacement across a broad cross-section of hospitals. This model is designed to: 1) provide better care for patients through more coordinated, higher quality care during and after a hip or knee replacement surgery, 2) increase smarter spending of health care dollars by holding hospitals accountable for total episode spending, and 3) improve coordination in health care, and by connecting care across hospitals, physicians, and other health care providers, result in healthier people and communities. Gabriel explained the policies outlined in the proposed rule for this model. The model, currently in the rulemaking comment period, would begin on January 1, 2016. More information on the model can be found here.
Dr. Kenneth A. Martin, an orthopedic surgeon with Martin Knee and Sports Medicine in Little Rock, Arkansas, described the steps he took in his practice, as well as the changes made in his hospital, to meet the challenges of the new bundled payment system. Dr. Martin feels that stronger coordination of care in the bundled payment model creates significant savings per patient. As part of a physician-owned hospital, payment discussions were easier, but significant work was still required to get all parties onboard.
Dr. Patricia Maryland, President, Healthcare Operations and Chief Operating Officer, Ascension Health, spoke with CAMH on August 27 about the organization’s commitment to value-based payment.
[CAMH]: Ascension states that it is pursuing strategies to better deliver value-based health care in a way that is more efficient, centralized, standardized, and collaborative. Would you please briefly describe your key value-based business and clinical strategies?
Maryland: Our vision is personalized care. We believe that the future of health care is consumers being much more involved and proactive in their own care; they will drive what happens to them. Our aim is to put the person at the core of our work—people from all walks of life, especially those struggling. It is very important to listen to what people need, then challenge ourselves to be innovative in delivering care that meets their needs. Integrating care is key to our strategy, so that all our providers can deliver the best care in a coordinated fashion.
Two examples of this innovative approach are Together Health Network and MissionPoint. Our Together Health Network (THN) is a clinicallyintegrated network formed in 2014 by Ascension Health Michigan, Trinity Health Michigan, and physician partners across the state. Both Trinity and Ascension Health share the vision to develop a physician-led, statewide, clinically-integrated network that delivers on what we call the Quadruple Aim: high quality, patient exceptional experience, provider exceptional experience, and low cost. We are committed to innovation and care transformation. Our goal is to build on the successes of our health systems and partner with physicians to better coordinate care across the continuum and shift to a proactive, planned, and engaging approach. In addition, both organizations support the efforts to further the Catholic health care presence in Michigan as a way to ensure access to reverent, missionfocused care. We already see some successes with integration. The THN leadership team is in place, and discussions with payers to develop strategic products and pursue other contracting opportunities are ongoing. In addition, we’ve started to build an integrated, enabling infrastructure across the network. We are enabling real-time information exchange between our hospitals and physician practices and are working to extend to other providers in the care continuum. The first THN product developed was a Blue Care Network Medicare Advantage narrow network plan named ConnectedCare, which was launched on January 1, 2015. The plan is available in targeted counties. It has exceeded our initial enrollment projections and continues to draw interest from partnering payers. MissionPoint builds networks with physicians and other caregivers to enhance their ability to deliver highquality, safe, and valued care. It provides clinically-integrated networks, clinical management services, physician alignment and incentive strategies, population risk analysis, onsite clinics, ‘care-at-a-distance,’ and wellness services. We now operate in seven states, have more than 7,500 directly contracted clinically-integrated providers, have more than 250,000 members, and manage $1.5 billion in annual health care spending. We are expanding MissionPoint into a number of other markets across the country. By working with MissionPoint, selfinsured employers, payers, government agencies, and other organizations can access these networks to improve health care outcomes for their members, while also lowering overall healthcare costs.
[CAMH]: Do you think there are unique aspects of your approach?
Maryland: Absolutely. First, we do not impose a one-size-fits-all model. Our programs are tailored to the needs and readiness of the market. For example, Mission Point works in seven states while Together Health Network (THN) is specific to Michigan. In the THN model, Ascension Health and Trinity realized that we were aligned in so many ways: we are both Catholic health care systems with similar missions and we complement each other geographically. Together we will have great impact on health across the state.
Also, Ascension Health is committed to serve the communities across the country with compassionate, personalized care for all. We know we have to focus on more than just health; we have to improve the overall quality of life. This means starting with the basics: housing, safety, and nutrition. The social determinants of health are key. We have several unique initiatives in partnership with the community. For example, in Detroit, we saw declining populations in certain zip codes and underused hospitals. We repurposed some of our assets to serve this population differently. We created community hubs, partnering with other organizations and agencies to have a broader impact. We worked with the police department to create a safe environment. We converted one old hospital to a senior center, partnering with the Agency on Aging. We set up activities, services, primary care and urgent care. We created a safe walking trail around the campus. We set up cooking classes and a dollar store selling fresh fruits and vegetables for less than one dollar. We have done similar things in other states as well.
[CAMH] What led your organization to commit to the Secretary’s challenge?
Maryland: We believed in the challenge. As the largest Catholic and not-for-profit health system, we asked, “If not us, then who?” This is so consistent with our mission. And we know we have to change the delivery system. Look at our country’s international ranking for health status. Look at the impact of escalating health care costs on employers and our national economy. We must focus on getting better outcomes, better patient experience, and better experience for those who care for them. Lower cost is not our driver; it is a by-product. Practicing evidence-based medicine and coordinating care are key to better outcomes and experience. We must bring all the necessary multidisciplinary providers together as a team to create a treatment plan to optimize outcomes. We must integrate diagnostic services, specialists, and all components of the care continuum to provide care from a holistic perspective. “Connect, coordinate, and integrate” is our theme.
[CAMH]: How have alternative payment models impacted your partners?
Maryland: As alternative payment systems drive us to value versus volume—to provide proactive care versus episodic treatment—our partners see risk because it challenges some long-established patterns of behavior. But they also see opportunity to make a difference in people’s lives. That seems to give them greater willingness to take on risk, both upside and downside risk (a share in the savings over budget and the loss if costs exceed budget). Together we must monitor and manage care for covered populations in the most appropriate way that will provide excellent care and drive down cost.
[CAMH]: Could you highlight a particular patient’s situation and how it is/would be affected by an alternative payment model?
Maryland: One such story involves an elderly couple who were stable with multiple chronic conditions. Suddenly, the husband, who had heart failure, began to come to the emergency room with worsening symptoms, and his wife started to be seen multiple times for falls. They both were treated and their medications were adjusted. The health partner did a home visit due to the worsening situation and found that the hot water heater, which was in the kitchen, was leaking and the couple had no means to have it repaired. This was leading to the wife slipping and thus not being able to prepare the correct food for her husband. They began to eat more processed food, which worsened his heart failure. By finding the resources to replace the hot water heater, both their issues improved. New payment models will require us to figure out and fix these types of issues. The movement to a consumer-based, value-driven health system cannot solve all of these problems, but it begins to create the incentives for health care providers to address the impediments to health rather than simply treating patients in a fragmented way when they present. It is very exciting to see payment models become much more aligned with the true needs of those we serve.
[CAMH]: How does this (the move to alternative payment models) make good business sense?
Maryland: Standardization based on clinical evidence and sound business practices leads to highly reliable and efficient care, which leads to reduced costs. It is important to focus on quality and clinical outcomes, organize care around patients, create an evidence-based treatment plan, and enable information sharing. But, while efficiency is the business driver, we are also making the patient and provider happier. Patients appreciate the ease of access and ease of use; they want to come back. Providers also have good experience and will want to continue to participate. Nationally it makes sense because lower costs help make employers more competitive internationally and reduce the percentage of GDP that health care costs represent, strengthening the US economy.
Mr. Niyum Gandhi, Executive Vice President and Chief Population Health Officer, Mount Sinai Health System, spoke with CAMH on August 26, 2015.
[CAMH]: What is Mount Sinai Health System’s valuebased health care goal and what strategies are you pursuing to achieve it?
Gandhi: We have two tightly linked goals. The first is to be the most effective population health manager in the greater New York area and the second is to be the highest value provider of higher acuity care not only to the populations we manage, but also to those managed by other risk-bearing providers, payers, or plan sponsors. We provide services to keep patients who don’t need to be in hospitals out, but we also deliver acute care in a value-based way. On the population health side, we have a large, engaged primary care and medical specialty base, and are absolutely committed to supporting patients in a population health model across payers. Because of the geographies within the city we serve, we are moving towards managing populations across all payers – commercial, Medicare, and Medicaid. On the contracting and financial side, we participate in CMS’ ACO Shared Savings Program (SSP) and have an ACO with Empire Blue Cross Blue Shield. And several other population health initiatives will be announced soon. We are also pursuing arrangements with employers and unions to manage the total health care cost and quality of their employee bases. Our goal is to move all of the patients in our primary care base into a population health mode.
However, the contracting is easy part; the clinical transformation is the challenging part. We’re pursuing some strategies that are “a mile wide and an inch deep” – but getting deeper every day – such as common standards of care, and quality monitoring as part of our clinical integration program. But we also have some programs that are an inch wide and a mile deep that we’re scaling to meet larger and larger blocks of patients. For example, we have a number of programs set up through CMMI grants and other grants to manage patients outside the hospital, such as a hospital at home program and a preventable admissions program, and we’re working to scale those and make them available to more patients. Simultaneously, we’re pursuing complete transformation of our primary care practices – going far beyond the PCMH model to a model that is purpose-built for population health. For this and all of our clinical initiatives, our driving philosophy is around continuous improvement – “always be better than we were yesterday.” With regard to the second goal, we participate in bundled payments and other episode-based programs across our hospitals. We are participating in CMMI’s Bundled Payments for Care Improvement program in several clinical areas, and are adding more this fall. We also have bundled payment programs for various employers, payers, and other plan sponsors. Again, here we’re transforming the clinical model to align with the new contracting model by aligning around a common standard of care and building pathways into physician workflows – this allows us to drive down the total cost of care while improving quality and patient satisfaction.
[CAMH]: Do you think there are specific characteristics, practices or policies of a health care organization that are the biggest enablers of success in implementing value-based payment?
Gandhi: I wish there was a list of these so we could all imitate them! In my mind, two things are critical. First, putting the philosophy of continuously driving better value into the care model. Many organizations develop a care model but then it stagnates; they don’t continuously try to improve the model and the care. Second, there has to be true commitment from the top of the organization to achieve this. The CEO, the Board, and the entire leadership have to commit to transition the organization to value-based care. When organizations delegate responsibility down several layers to handle “this little population health strategy,” they don’t succeed.
[CAMH]: Do you have any results to date?
Gandhi: We have seen an impact on quality in our preventable admissions, visiting doctors, and hospital at-home programs – and we have seen a dramatic reduction of admissions and readmissions within these programs. For example we have observed a 53% reduction in hospital admissions for patients who are managed through our Preventable Admissions Care Team clinic over their first year in the program. At the macro level, we have seen strong performance in multiple years on our Medicare Advantage risk population, and continued improvements in our efforts to manage a very challenging Medicaid population – the results are always getting a little better. We are starting to do more rigorous assessments of the results of our programs to determine what to scale and what to change, which I believe will help us accelerate our progress.
[CAMH]: What was the most helpful step you’ve taken so far?
Gandhi: Signing up for the Medicare SSP in 2012 was a critical step the organization took. The leadership took the first step towards population health even before our merger with Continuum Health Partners, and before we had the primary care base with breadth of geography we now have. The organization was able to begin building experience in thinking about total cost and quality of care, and how to think about our patients not just when they are with us but across their entire set of interactions with the health care ecosystem. If we had not started this journey in a small manner three years ago, we could not be making some of the investments that are needed to really expand our efforts now.
[CAMH]: What were the biggest challenges you’ve encountered?
Gandhi: The biggest challenge is the complete change in culture that is needed. We began from a culture of high value but we are moving much further. Sometimes this change is subtle, but sometimes it’s more meaningful. For example, in our primary care practices we have wonderful physicians who are used to delivering great care to the patients they see on any given day, but now they have to think about patients they won’t see that day as well. Who’s not coming in who should be? Should the primary care provider reach out to them? How can we offer them “care” outside the immediate setting, regardless of whether they are in our care at any moment? Changing the underlying culture across of 35,000 employees and thousands of other aligned providers will continue to be an ongoing challenge. But we are committed to taking on that challenge, and we’ll certainly learn from our peers as we discover what it takes to drive the cultural shift in the organization toward continually higher value.
[CAMH]: Do you think Mount Sinai has any unique characteristics or strengths that help it overcome the challenges? Are there unique characteristics or issues that give you added challenges?
Gandhi: We are an academic health center that is firmly committed to population health. While we are not entirely unique in this, there is only a small group of large academic health systems that are trying to make this change. The vast majority focus only on providing high value acute care; they are not doing population health. This uniqueness is an asset, because we have committed physicians who not only have great technical skills but are making significant contributions to the field through teaching and research as well. Being at the intersection of care delivery, research, and training gives us the opportunity to unlock greater potential. We can contribute evidence, and we can help define how the workforce of the future should be prepared. Having this triple mission introduces more complexity, but I believe it can create greater value.
[CAMH]: What other key lessons would you like to share?
Gandhi: I think it’s wonderful how much we can learn from our peers at other organizations. Health care is a unique industry in that the vast majority of other organizations aren’t competitors by virtue of their non-overlapping geographies. One of my colleagues always says that we don’t have an innovation problem in health care – we have an imitation problem. And I’ve found that we can have great success by looking beyond our walls and finding the right innovations to imitate and adapt to our circumstances.
You’re invited to the first LAN Summit, October, 26, 2015 in Arlington, VA. Meet Guiding Committee members, hear updates from work groups, and engage with your fellow APM innovators. Go home with the knowledge and tools you need to successfully transition your organization to alternative payment models.
Whether your organization is just beginning to explore APMs or has been running an alternative payment model for years, this event will support you as you Engage, Learn, and Act!
To achieve the goal of better care, smarter spending, and healthier people, the U.S. health care system must substantially reform its payment structure to incentivize quality, health outcomes, and value over volume. The Health Care Payment Learning and Action Network (LAN) was established as a collaborative network of public and private stakeholders, including health plans, providers, patients, employers, consumers, states, federal agencies, and other partners within the health care community.