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In New York State, a Unique MSSP ACO Cares for Patients with Intellectual Disabilities

December 20, 2017
by Mark Hagland
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A unique ACO has emerged in New York state in order to optimize care for patients with intellectual disabilities

Even as purchasers and payers of healthcare are compelling the providers of healthcare forward into value-based payment models, one area has until now been left completely unaddressed: how to care for the needs of individuals with intellectual and developmental disabilities (IDDs). Such individuals present severe chronic health conditions, usually present at birth, that limit the trajectory of their physical, cognitive and emotional development and opportunity to live in most integrated community based settings.

Meanwhile, the Medicare Shared Savings Program (MSSP) for accountable care organizations (ACOs) continues to move forward, with hundreds of provider groups collaborating to work with public and private payers of healthcare to share savings, while taking care of patients across the continuum of care.

And now, for the first time, an MSSP ACO has been formed to manage the care of individuals with IDDs. That organization is the Alliance for Integrated Care of New York, LLC (AICNY), based in New York City, the first and only MSSP ACO of its kind in the U.S., formed in 2014 to oversee the healthcare needs of individuals with IDDs.

Seven outpatient diagnostic and treatment health centers and 25 licensed private practices affiliated with the Queens County Independent Practice Association (QCIPA) have come together to form AICNY, in order to focus on treating this vulnerable and underserved population. These provider organizations represent a significant footprint encompassing most of New York. Approximately 200 physicians and other healthcare professionals care for more than 6,000 dually eligible Medicaid and mostly Medicare beneficiaries, the majority of whom are IDD patients.

Like the leaders of so many emergent ACOs, the leaders of the Alliance have had to work through numerous dimensions of obstacles in the way of seamlessly capturing and sharing relevant IDD-patient data such as routine and follow-up visits, prescription orders and refills, and longitudinal medical records.  In their case specifically, the leaders of the Alliance had been finding it difficult to reduce the unnecessary utilization of resources; for example, a common problem was that so many of their patients with multiple chronic conditions were being needlessly sent to emergency departments multiple times per month, to avoid citations by the government agency responsible for conducting on-site quality reviews.

So the AICNY leaders partnered with the Piscataway Township, N.J.-based HealthEC, in order to aggregate and analyze IDD beneficiary claims onto a population health management platform; risk-stratify and identify patients appropriate for targeted care interventions; and meet quality data collection and reporting requirements, for such programs as the MIPS (Merit-based Incentive Payment System) program under the MACRA (Medicare Access and CHIP Reauthorization Act of 2015) law.

The Alliance also equipped its participating physicians with dashboards to unify data and compare their performance against pre-established quality standards so they can track care improvements. In addition, to the extent that primary care physicians and specialists could share electronically information from their consults, unnecessary follow-up appointments could be averted—a significant consideration for a population for whom doctor visits can be mentally and physically taxing.

What’s more, in order to better serve New York’s IDD population, the Alliance is integrating medical care management by digitizing their entire residential world of health centers, private practices and ultimately long-term care agencies. Its goal is to build electronic information sharing of pre-service summaries populated with the most relevant documentation accessible for every provider’s IDD patient visit. And, with that in mind, the Alliance’s leaders have spent considerable time creating workflows that can optimize the appropriate sharing of clinical information.

Recently, Healthcare Informatics Editor-in-Chief Mark Hagland spoke with Duane Schielke, the Alliance’s executive director, to gain insights on how this broad initiative is moving forward. Below are excerpts from that interview.

Your headquarters is in New York City, correct?

Yes, we’re based in midtown Manhattan.

Tell me a bit about the history of the Alliance?

AICNY was established in 2014, initially to buy a group of IDD agencies, which included Cerebral Palsy Associations of New York State, where I'm the executive vice president for healthcare initiatives. There's a 5,000-person minimum requirement to be an MSSP ACO. What we found is through the process of attribution, which is quite a complex process, the 5,000 patients that we had identified that are dual-eligible turned out to be not 5,000, because of how the attribution works. Which fortunately is changing next year in a very positive way so the patients can actually self-select. So, we formed the ACO with another group in Queens, and currently, we have seven IDD outpatient clinics; they're the core part of the piece that I'm mostly involved in.

Duane Schielke

So, we reached out and recruited some of our cerebral palsy affiliates that run clinics, to join the ACO, and got ourselves started. Then spent a couple of years learning what does it mean to be an ACO, and what does it mean to use healthcare informatics in a way to manage people's care, which was an entirely new concept for us, and there's actually no data available on the spending cost related to people with IDD on the healthcare side.  People with IDDs are typically born with a disability or acquire a disability before age 21, and there's federal definitions: mental retardation, cerebral palsy, epilepsy, autism, other neurological disabilities. It impairs their development, because they received it prior to their learning years and they're eligible for special benefits as a result of that. 

When did you officially join the MSSP program?

We joined the program in January of 2014, which means that we're in our second three-year term. MSSPs run in three-year terms, so we're in a term that ends at the end of 2019.  

And what, very broadly, what have been the biggest lessons learned strategically, so far, in participating in an MSSP?

Well, as I said, there was no data about what it costs to serve people, and because the health information sharing networks are still just evolving we never had any information about what we call "outside providers," meaning people other than our own clinics. So, we have maybe some documentation from the visits that people collect when they leave, but we didn't know what it cost and we didn't know the frequency because nothing was digitized. And you're looking at... in our case, in our residential program for example, 600 people. Paper records with no ability to do any kind of an analysis without taking on a monster, monster project that would probably not be very effective.  

So, tell me a bit about your organization’s digital transformation.

The digital transformation was everything. The [HIT] part of this project is the most phenomenal piece; we couldn't even imagine what it was going to do for us at the time, but now that we get claims data, we're expanding the program, and we've convinced New York state Medicaid to share claims data using the same population health management platform that HealthEC provides to us, and [harmonizes with] the outpatient EHR and long-term care software used in patients’ homes, where they’re tracking rehabilitation services.

So, we’re digitizing records over on that side, charting blood pressures, menses, bowel movement charts, all of the things that doctors need to know to provide a good clinic visit; those will be all digitized so that we can provide that information to physicians electronically prior to the visit, so that they're prepared for that visit in a way they've never been prepared before. We send them the medication administration record that's actually effective as of that date.

One of the challenges is that when clinicians look at the EHR, they see this continuous flow of medications coming in, but nothing ever stopping, and the physician can never reconcile the patient’s current medications with what the doctor had documented previously in the record, unless we send them the medication administration record from the home. So that has been phenomenal in terms of changing the game, and using digitized records in a way that we were never able to do before.

So now, at the beginning of every month, a patient’s current meds are prefilled out in this form, the staff go in, put electronic signatures in when they administer something, and so on; so now, the physician, whether the primary care physician or the specialist, can clearly see the patient’s current medications. That is truly significant, given that it’s not unusual for our patients to be on nine or ten meds at a time.

What’s more, trying to integrate behavioral health and primary healthcare is a challenge if you don't have current medications data, because that's where most of the work has to be done in terms of reconciling things. You know, one doctor prescribes, another doctor prescribes something else, and then there’s a bad interaction, and it’s not [tracked], and eventually, someone has to start pulling paper to figure out what’s going on—and that’s just so inefficient and ineffective.

Could you drill down on the mechanism involved, the flow of data?

Yes, we’re creating feeds from PrecisionCare, the long-term care solution, into HealthEC’s platform, which sits in the middle, between eClinicalWorks, the clinic EHR, and PrecisionCare. As a result, we can get the digitized records of meds and the charting that occurs by the direct care staff on a day-to-day basis. Then we have a bidirectional channel to eClinicalWorks, so that the HealthEC platform is refreshed daily with any new information from eClinicalWorks, including posted summaries and blood work, radiology or whatever comes into eClinicalWorks, then gets pushed over to HealthEC so that the medical case manager views HealthEC and sees everything in one place. So, they don't have to go back and forth between platforms, which is a nightmare. We found out from the users that, "Don't make me sign into another program." We spent the money and the time to make it electronically interoperable so that they can go to one place, see everything they need, make the decisions, review things, do follow-ups, make another follow-up appointment if necessary; allows the primary care to jump in that loop so we don't repeat follow-ups with outside specialists that are unnecessary, but we can continue forward if we need to.

When did your organization go live with these systems?

We've been using HealthEC for AICNY since 2014, I'm sorry 2016, and eClinicalWorks has been in the clinic since 2012.

So, every night, the eClinicalWorks data is dumped into a server and HealthEC picks up from that server, and you're going to make that a more automated, instantaneous process? 

Yes, that’s right.

And how long will it take to go live with the instantaneous, the more fully automated version of that? 

Probably about six weeks. 

And can you share a bit about the care managers?

There are about 25 care managers in Metro, which is the operation that New York state operates; and if you multiply that number times seven, to 400, that’s roughly the number of care managers across the state, who with about 75 providers, are managing about 25,000 patients in this program.

And those 25,000 patients are all dual-eligibles; does that mean that they are all seniors?

No, not necessarily, as many are younger people with development disabilities who become eligible when their parent becomes eligible for Medicare.

Obviously, you’re working in an environment of constrained budgets. What have been some of the biggest lessons learned so far in terms of innovating on a budget?

Having claims data in a platform that allows us to do analysis shows us who the high users are, because as is typical across populations, there's a select group of people that use the majority of resources. We can sort and stratify to find out what the conditions are that are driving high cost, what are the occurrences that are driving high cost, like high use of an emergency room and inpatient use, use of specialists. We have very, very high use of diagnostics, but that's not a bad thing, that's a good thing.  The difference between our group and a typical group is that these folks are challenged in reporting their healthcare issues, either because of communication issues or cognitive issues. The physicians are challenged and do a lot more diagnostics to be able to get to the bottom of what conditions they're treating. So, that's high but that's a good high. Meanwhile, using the emergency room is high, but that's a bad high.

By leveraging health informatics, we can find the “low-hanging fruit,” to be able to focus our care management efforts where it counts. If you just say, "Be intense with everybody," you get nowhere, it's too big of a workload. But if you create reports and you say, "Focus on Johnny, Sally, Susie and Fred," because those are the guys that are going to the emergency room a lot, and you loop that back to the primary care doctor, find out what's causing this high use of emergency room, and then start to do some preventive care so, that you're not just diverting from the ER you're actually solving the problem so you don't have a repeat of these things. The informatics, they're interesting because you see that if someone used the emergency room a lot last year, and you don't do anything about it, they're going to use it a lot this year. The repeat patterns from year to year are quite phenomenal; and they’re logical, once you think about it. But to know who they are, knowing who they are and why they went, because you've [sic] the diagnostic [sic] from the ER, and we find that maybe 60 percent of them are deemed unnecessary, but they needed to be treated, so we can see why they're going in and try to prevent that from happening.

So it’s like so many other initiatives right now, in that you’re trying to drive clinical interventions upstream, correct? And because you have a population of patients who, as you had mentioned, for cognitive and other reasons, find it difficult to articulate what’s going on with them; so using analytics helps you manage care upstream, correct?

Yes, that’s exactly right. Overall, in terms of the big picture, we’re preparing for value-based reimbursement. In fact, New York state has been going through an amazing transformation of converting everything in Medicaid, and that's all of these folks because they're duals, to value-based payments, and at some point, we need to be able to assume upside and downside risk. And in that context, we want to be able to minimize those risk corridors, so that we're managing at a high level, so that we're doing it in an informed way and be able to maximize our effectiveness in a value-based payment methodology. So, that's really the big picture, because we would never have learned how to prepare for that if we weren't doing all of this work.   

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Heritage Medical Systems’ Voyage to Value—and How Physicians are Leading the Way

October 11, 2018
by Rajiv Leventhal, Managing Editor
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“If you have no risk at all, how hard you work at something is different than if you have some risk,” says one healthcare leader

As the accountable care train continues to speed up, innovative healthcare leaders are realizing that physicians—the ones who are working side-by-side with patients on a regular basis—will be key to making the transition to value successful. In California, Heritage Medical Systems, which also has providers operating in New York and Arizona, has been at the forefront of the accountable care revolution, and its senior executives point to its physicians as the ones who are leading the change.

Mark Wagar, president of Heritage Physicians Organization, which operates under the broader Heritage Medical Systems umbrella, recently spoke with Healthcare Informatics about his organization’s value-based care journey, its accountable care organization (ACO) progress, and how physician culture can be changed as providers take on more risk for their patients. Below are excerpts of that interview.

Where do things stand regarding Heritage’s value-based care evolution?

Heritage Physicians Organization is part of Heritage Medical Systems, which has lots of medical organizations in several states. I believe we have about 3,700 primary care physicians and 12,000 specialists that are involved in our ACO endeavors. This has been driven off the original and largest piece of our business in California. And it was a policy decision early on, from our founder, Dr. Richard Merkin, to get into [the Center for Medicare & Medicaid Services’] Pioneer ACO model, even though it was not our core business.

We have been involved in value-based care, the full-risk version, for decades, but we wanted to demonstrate that if you can surround private fee-for-service physicians with the kind of capabilities and infrastructure that we give our traditional business, an ACO has potential. So we did that and are continuing to move forward with that program. But we also believe this: the country would benefit if this all moved faster.

Heritage has evolved from the Pioneer ACO model, to the MSSP (Medicare Shared Savings Program), now to the Next Generation ACO model. Can you talk about the biggest lessons learned so far?

Generally, it’s a step in the right direction. The ability to get more of the funding earlier enables provider organizations to have the funding, change the system, and change what we do. You don’t have to drive off billable events only. We finally have this exploding recognition suddenly that social determinants and behavioral health are important. But that has been apparent to any physician organization for decades, particularly for us as we have been involved in value-based care and risk arrangements since the 1970s.

It became obvious that depending on the patients and the circumstance—what happens in their home and community, what surrounds them, and what their other issues are—may be more important than the physical interaction with their providers. You have to know that in order to manage their health. Once you move away from the mindset of, “I just need to be excellent when you fall in the door, sick or injured,” and move toward, “I will try to help you not fall in the door sick or injured,” or at least have it take longer for it to happen, or maybe you won’t be as bad when you do fall in the door, that’s when the light bulb goes on. We are happy that it’s becoming a broad part of the equation.

Mark Wagar

What are some of the most important IT and data elements to being successful in this transition?

I think as much real-time data and access as you can get is extremely important—so what care a patient is getting, and where, and what is happening in his or her life. If you work from the traditional basis, we pay claims in partnership with our health plan partners, and we pay the claims on the vast majority of our business. And when we do that, our physicians, nurses, pharmacists, social workers, and everyone else involved in the patient’s care, don’t have to wait every three to six months for a review of the data. We see the data today—this hour.

If someone shows up with a conflicting set of prescriptions, or an event that the primary care physician didn’t know about, you want to find out about that right away, and find out what’s happening and what’s wrong. Looking back at trends is important in terms of a future planning perspective, but in terms of what is happening with the patient right now, especially those who are at risk, you want to have that information right now—today, tonight, this hour—and do something about it.

Dr. Merkin’s next question after he talks with physicians about a patient is, “So you know this information, and what are we doing about that right now?” It’s much different than the traditional fee-for-service system where the data just isn’t available to the provider at the level until much later.

What are your thoughts on the recent policy developments on the ACO front these days? Are the government’s proposals to push providers into risk more aggressive than some would like?

Yes, it’s more aggressive than some would like. But this is not about what all of us would like; it’s about how you get to where things are optimal and most effective faster. If you fully embrace both the access to the resources, and the risk, and you are able to spend the money on the resources—in terms of changing the system, changing the way you do business, and not accepting the status quo—you can make a significant difference.

The one-sided risk models are a very important way for providers who may be uncertain to get started, but we are talking about managing a human being-based system of care. If you have no risk at all, how hard you work at something is different than if you have some risk. Providers always want more dollars to do something with, but you don’t get dollars if you aren’t in a position to do something materially different, and essentially guarantee that at least some of it will happen.

We still have a fee-for-service-based system and much of the value-based payments that health plans have moved to is a positive thing that has stimulated some change, but it’s paying you a year or a year-and-a-half later—maybe a little differently if you happen to administer a result as a bonus—but you are still getting that underlying fee-for-service payment. If you are in a one-sided model, it masks and slows down how quickly you get to what could be done if you had more of the resources.  

How have you and your colleagues been able to change the physician culture, in terms of moving physicians to a new understanding of what’s going on in healthcare?

In Heritage’s markets where the models are most mature, it’s a combination of physician groups where the doctors are employed, as well as significant numbers of independent practices and smaller offices in the community, and we can blend those. But the physicians individually are not at personal material downside risk. There is an organizational structure that manages the money that comes in when we are fully at risk, but regardless of whether they are employed or an independent practice, they are all tied to a payment at the individual physician level.

That’s one of the things that is missed in the whole conversation over providers being put more at risk—an individual practice office with a few thousand patients is not in a position, actuarily, to accept all that risk. You have to be partnered with some kind of system.

In our instance, in our most mature markets, it’s a blend of employed physicians and independent practices, but in some markets all we have are independent practices. So we can do this if we surround them with the infrastructure if you aggregate enough members from the plans that give you an actuarily valid risk base, and then you have the money up front, so you can help them with information and give them information faster. Then, they can do good things for their patients faster.

What advice can you give to others who are just starting out on this journey?

I [wouldn’t] sit and stew about how difficult it is to be in your position and be surrounded by all these regulations and requirements that can become tough to manage. You can talk about that all day, but it’s ultimately the people’s money and they are asking for better quality, better service and access, and more moderated costs. The only people that can ultimately change things on all those fronts, for the better, are provider organizations—predominately those led by physicians.

But we cannot afford to take decades to make the next set of changes, unless we want government intervention that breeds mediocrity as a result. Physicians and providers should lead this change, and moving this faster will bring the best things for their patients in the long run. Demand more of the dollar in your control immediately, and in order to do that you have to have the structure around you and the willingness to accept responsibility for that dollar. We are trying to show people out there that you can partner with others, and it’s possible to get net better across these factors if you enable the physicians to manage more of the dollar from a clinical perspective, to the patient’s benefit.

More From Healthcare Informatics


Are Disruptive Forces in U.S. Healthcare Accelerating Now? Notes on the Now-Approved CVS-Aetna Deal

October 10, 2018
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The DoJ’s approval of the CVS-Aetna merger signals a new phase in the healthcare business world—and it’s time for patient care executives to rethink the meaning of competition

As Associate Editor Heather Landi noted in her news report Oct. 10, on Wednesday, the Department of Justice (DoJ) approved a proposed $69 billion merger between CVS Health and health insurer Aetna, after Aetna entered into an agreement with the Department to divest its Medicare Part D prescription drug plan business.

“The deal,” Landi wrote, “is the latest in a wave of combinations among healthcare companies, including many pharmacy benefit manager (PBM) and insurer integrations. Last month, the Justice Department approved Cigna’s $67 billion takeover of Express Scripts. CVS Health announced in early December 2017 its intention to acquire Aetna in a $69 billion-dollar merger, marking the largest ever in the health insurance industry. Woonsocket, R.I.-based CVS operates the nation’s largest retail pharmacy chain, owns a large pharmacy benefit manager called Caremark, and is the nation’s second-largest provider of individual prescription drug plans, with approximately 4.8 million members. CVS earned revenues of approximately $185 billion in 2017. Aetna, headquartered in Hartford, Connecticut, is the nation’s third-largest health-insurance company and fourth-largest individual prescription drug plan insurer, with over two million prescription drug plan members. Aetna earned revenues of approximately $60 billion in 2017.”

As Reed Abelson wrote in a report in Wednesday’s New York Times, “The approval marks the close of an era, during which powerful pharmacy benefit managers brokered drug prices among pharmaceutical companies, insurers and employers. But a combined CVS-Aetna may be even more formidable. As the last major free-standing pharmacy manager, CVS Health had revenues of about $185 billion last year, and provided prescription plans to roughly 94 million customers. Aetna, one of the nation’s largest insurers with about $60 billion in revenue last year, covers 22 million people in its health plans.”

And, while executives from the two mega-companies assert that this merger will allow them to better coordinate care for consumers, while also better controlling costs, some consumer advocates believe that the opposite could actually take place—that consumers could lose both choice and reasonable medication costs. “This type of consolidation in a market already dominated by a few, powerful players presents the very real possibility of reduced competition that harms consumer choice and quality,” George Slover, senior policy counsel for Consumers Union, an advocacy group, said in a statement. “The combination of CVS and Aetna creates an enormous market force that we haven’t seen before.” The consumer organization, the Times report noted, had opposed the Aetna-CVS merger, arguing that people enrolled in Aetna health plans could be forced to seek care at CVS retail clinics, and that those who were not insured by Aetna could pay higher prices for drugs than those who were.

Meanwhile, what fascinates me in all this is the potentially accumulative impact of all the various disruptive business combinations that have been emerging in U.S. healthcare—not just CVS/Aetna, but also the Amazon/Berkshire Hathaway/JP Morgan Chase collaboration on healthcare costs and other challenges; Wal-Mart’s interest in potentially acquiring Humana; and the forays into consumer-facing healthcare IT on the part of Google and Microsoft.

All of these business deals, collaborations, and potential connections involve either “interspecies” combinations, or forays into new areas on the part of companies from outside those core business areas. And that should concern traditionalist-thinking leaders in patient care organizations, especially senior executives in tradition-bound hospitals and health systems, who have historically thought about competition as being direct hospital organization to hospital organization competition. With all sorts of non-traditional business combinations emerging, that kind of thinking ends up being not just limiting, but potentially debilitating.

The reality is that every part of the policy, business and operational landscape on which hospital-based organizations is now in motion—at the same time. Physicians are coalescing into ever-larger multispecialty physician groups, some of them affiliated with hospital-based integrated health systems, but many of them totally independent. Health plans are acquiring physician practices, and are, in many markets direct competitors with hospitals in the acquisition of those practices. Health plans are also continuing to consolidate among themselves. Employer-purchasers are eliminating the health plan “middleman,” and setting up direct contracting with some of the largest and best-known nationally branded patient care organizations; and on and on.

I wrote last year about attending a fascinating session on employer direct contracting that took place at the World Health Care Congress in Washington, D.C. last spring. Employer-purchaser executives talked with great enthusiasm about such contracts. One executive, representing the nationwide Lowes home improvement retail company, shared his enthusiastic response to contracting directly with the Mayo Clinic, to bring patients from places as faraway as Montana and Mississippi, to Cleveland, for total joint replacement surgeries, at scale.

I quoted Bob Ihrie, who had recently retired as senior vice president, compensation and benefits, at the North Wilkesboro, North Carolina-based Lowe’s Companies, about that contracted relationship. “As Ihrie noted, for an extremely far-flung self-insured employer like Lowe’s, with its 1,800-plus home improvement stores spread across the U.S., doing what the Chicago-based Boeing Corporation, with its massive plants in Washington state, California, Missouri, and South Carolina, and its ability to build bricks-and-mortar corporate medical clinics in those locations, the options for Lowe’s are rather different,” I wrote. “Thus, the desire to create systems to improve their patient outcomes for their covered lives, and improve costs.” Indeed, I wrote that Ihrie told that World Health Care Congress audience, that, “The quality results have been so overwhelming that for Lowe’s for 2017, if you elect not to go to a center of excellence, you need a mandatory second opinion, and if it doesn’t approve, you won’t be covered.” He further noted that “Wal-Mart actually mandates travel to a center of excellence.”

In other words, the old thinking among hospital organization senior executives—to think primarily about market competition as being illustrated by the fact that the hospital down the road is building a new facility—is hopelessly outdated at this point. Indeed, it’s time to consider that market competition may now mean a major nationwide retailer with a strong local presence, compelling its employees and their family members to fly across the country to a patient care organization with national branding and presence, rather than to one’s own facility, or to the facility down the street.

In short, it’s time for hospital executives to think very differently about what market competition and market disruption might mean for their organizations. It’s time to start playing three-dimensional chess.

And I haven’t even discussed the role that consumer-facing technologies, many of them spread through online apps and wearable technologies, will begin to play in all this. That adds yet another cross-hatch factor to this entire discussion.

So it’s time for healthcare executives to rethink the very definition of market competition, and to think in unprecedented ways about market disruption; because this DoJ approval of the CVS-Aetna merger should absolutely be taken as a sign of things yet to come.




Related Insights For: Value-Based Care


At the HIT Summit in Raleigh, a Health Plan Executive Points to the Future of Value-Based Care

October 8, 2018
by Mark Hagland, Editor-in-Chief
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Speaking at the HIT Summit in Raleigh last month, Humana’s Ben Lunsford offered attendees insights into the future of value-based healthcare, and his health plan’s future intentions

Speaking at the Health IT Summit in Raleigh, held September 27 and 28, and sponsored by Healthcare Informatics, Ben Lunsford, vice president, value-based strategies, at the Louisville-based Humana, offered attendees insights into the future of value-based healthcare and the trajectory of value in the current U.S. healthcare system.

Lunsford spoke on the topic “Humana’s Value-Based Strategy,” on Friday Sep. 28 at the Summit, which was held at the Washington Duke Inn & Golf Club, on the campus of Duke University, in Durham. As of 2014, according to the Wikipedia entry on the company, Humana had over 13 million customers in the U.S., and 41,146 employees as of 2018, and net income of $2.448 billion on revenues of $53.767 billion, in 2017.

Lunsford, who is based in Birmingham, Alabama, and has been at Humana for 14 years, focused on the company’s Medicare Advantage (Medicare managed care) business, which encompasses 3.5 million members; in addition, the health plan counts 1.5 million commercial group members and 9 million military members.

As Lunsford shared in his presentation, “Value-based care is different from the current fee-for-service (FFS) model of care, which simply pays for the number of services a patient receives. These services include physician and hospital visits, procedures and tests. While value-based care pays physicians for these services, it also includes more pay for meeting quality measures, coordinating care, preventing repetitive treatments, controlling overall costs and improving health outcomes.”

Lunsford proceeded to share with his audience the Primary care Value-Based Continuum model that Human has been executing, in its contracting with primary care physicians. It consists of four stages of development, with intensifying contracting features from one to the next. In order from least to most advanced, they are: the “Star Rewards” program, model practice program, medical home program, and full-value program.

In the Star Rewards program, primary care physicians have their outcomes evaluated using HEDIS-based quality metrics, with an annual payout benefit calculated in terms of a percentage of claims opportunity. In the model practice program, both HEDIS-based quality metrics, and clinical measures developed by Humana medical managers, are employed, and the rewards to primary care physicians involve a quarterly shared savings opportunity. The medical home model involves primary care physicians working in medical groups that have received some official form of recognition as patient-centered medical homes; those physicians are eligible for a PMP (per member per month) care coordination opportunity, with increased financial incentives. And finally, the full-value program involves monthly PMPM global capitation.

The Star Rewards Program this year has been using very well-known measures, such as breast cancer and colorectal screening rates, nephropathy screening rates and hemoglobin a1c control measures for diabetics, medication adherence rates for hypertensives, etc. PCPs are asked to meet six of nine NCQA (National Committee for Quality Assurance) HEDIS (Healthcare Effectiveness Data and Information Set) measures; practices that achieve that goal receive a 12-percent bonus paid annually.

Meanwhile, incentives accelerate both in terms of amounts of money, and pay schedules, as PCPs move into more advanced programs. Those in the Model Practice Program who meet quality measure standards (which are more extensive and include a readmission rate measure) receive $8 PMPM quarterly. Then, as they advance to the Medical Home Program, PCPs can participate in shared savings with Humana. And of course, for the PCPs ready to advance to the most advanced model, full capitation, those physicians will be participating in a model that is continuous in payment differentials.

Humana is also developing bundled payments in specific areas of specialty care, beginning with total joint replacements.

Speaking of all these models, Lunsford told his audience, “The patient experience of healthcare can seem fragmented. It can be frustrating for the health consumers. Ultimately, care delivery needs to be integrated rather than episodic, and focused on coordinated care and overall population health. This transition from volume to value is critical in enabling the shift to this integrated healthcare model, which… will allow us to have a sustainable healthcare system.”

It is of course no accident that Lunsford put the main focus of his comments on primary care physicians, who, he said, have the most influence on the health outcomes of patients. “Outside of direct care,” which itself is a huge part of all of this, he noted that PCPs “have an amazing amount of influence on the integrated care model; they’re the ones deciding which specialists to send patients to; providing needed prescriptions; educating patients on wellness. They’re our quarterbacks of care.”

That said, he continued, “Meanwhile, likewise, the patient has an amazing amount of influence on their own care. They’re the decision-makers. They’re deciding to engage in wellness and disease management programs; they’re deciding to be with a payer or a provider, based on the care they get. It’s absolutely critical to making the integrated care model succeed. And lastly, as a health plan, we bring an amazing amount of resources to the table, including a considerable amount of data. With that data, our historical picture of a transactional relationship is changing. We’re developing data to help physicians; we provide care referral and insights to physicians; and we can provide health and disease management programs, and care delivery options for where patients want to receive care, which oftentimes, is in the home. So we all bring something to the model.”

Though most of his time was focused on primary care physicians, and secondly, on plan members/patients, Lunsford did share about Humana’s new program, initiated on January 1, focused on hospitals, its Hospital Incentive Program. As described in his presentation, “The Humana Hospital Incentive Program (HIP) provides hospitals with an opportunity to participate in a value-based program that recognizes hospitals’ continuous patient improvement efforts, via earned annual incentive.”

The program provides annual incentives for hospitals based on performance in the areas of patient experience, patient safety, and patient outcomes. Among the specific measures included are a hospital’s HCAPHS (Hospital Consumer Assessment of Healthcare providers and Systems) scores; healthcare-associated infections; care coordination; palliative care; readmission rates, and average lengths of stay. The various measures are individually weighted, collectively totally 100 percent of the eligible incentive.

“We’re not only experiencing a seismic shift in the approach to integrated care, but also in the way we reimburse for it,” Lunsford told his audience, as he explained Humana’s value-based payment program. Meanwhile, he added, “Brand loyalty is another component of value. We make as consumers a choice around value in every purchase we make.”

Indeed, Lunsford said, “Humana’s primary care value-based continuum is truly the cornerstone” of the company’s strategy. And he noted, it is purposely “structured as a continuum: participants can move into the model. From Star rewards, to model practice, to medical home, to full value. As providers progress down that path. Each program builds upon the previous one. Star rewards just starts with quality; that continues forward into the other stages.” What’s more, he said, “This ability to enable and encourage, but not mandate, progression down that path to full value, is something that we find very valuable.”

Meanwhile, after explaining about the measures being used in the health plan’s programs, Lunsford said, “I often hear, why can’t payers get together and focus on the same set of measures? Wouldn’t that be a perfect world? I agree. But we seek guidance and counsel from many providers. And we also look at things like prevalence? Is a particular condition prevalent? We look at the PCP’s ability to impact the measure. And we look at things like our ability to measure. You’ll notice on the right that some of the measures are relatively binary. Did something occur or not? That is one factor. Also, the priority CMS places on us from the point of health plan scoring, influences us, too.”

Further, he said, “Let’s talk a little bit about how we set payment models. There’s a value placed on the achievement of certain measures. And it’s a delicate ballet between behavioral, actuary, and our clinical leaders, to determine what the best amount is that we can set. Second is the competitive element. If we pay you a dollar for something and Blue Cross or Aetna pays you five dollars, who will you focus on?”

Meanwhile, Lunsford noted of the model practice program, whose participating physicians are delivering care to 37 percent of Humana’s Medicare Advantage population, “Each measure has an incremental dollar amount assigned to it.” What’s more, he noted, elements such as ER utilization, readmission rate, and patient experience, that are being measured. Meanwhile, the measures used in the medical home program, the next step up, match those measured in the model practice program.

When it comes to medical specialists who contract with Humana under Medicare Advantage, they can participate in bundled payments around total joint replacement; and specialists participating in commercial insurance with Humana can participate in a maternity program.

As for the Hospital-Incentive Program that Humana launched in January, Lunsford noted, “We partnered with the Joint Commission on developing this model and a couple of its measures. It centers around the patient experience, patient safety, and patient outcomes, with, as mentioned above, six key measures: HCAHPS score; healthcare-associated infection; care coordination; palliative care; readmission rate; and average length of stay.

“We continually evaluate the care our members are receiving through value-based payment models,” Lunsford told his audience; and Humana executives plan to “aggressively” push value-based payments going forward. Meanwhile, he touted the fact that “Sixty-six percent of our Medicare Advantage members are now in some sort of value-based arrangement.”

Following his presentation, Lunsford spoke with Healthcare Informatics Editor-in-Chief Mark Hagland. Below are excerpts from that interview.

Can you say what percentage of all members are in value-based arrangements?

We don’t publish that number; but we can provide the number of members we have on the commercial side.

Understandably, much of your presentation focused on your arrangements with primary care physicians. Can you speak to your goals around contractual arrangements with hospitals?

The tie for us between a member or patient, the one responsible for care in value-based models, is the primary care physicians. To be sure, that PCP can be employed by or affiliated with a hospital or integrated health system, and we’ll still interact with that physician in the same way.

Can you speak to changes in the physician culture that are making physicians more amenable to entering into value-based contracting arrangements? Do you see progress accelerating?

Yes, I think so. Just by the sheer fact that we have 66 percent of our Medicare Advantage members in those value-based arrangements, shows that this concept of value-based is not going away; and it’s becoming more solid.

Are physicians more hip to what’s going on than a few years ago, in terms of the trajectory of the overall healthcare system?


Can you speak to physicians’ preparedness to participate in measurement programs?

There is a wide array of capabilities in that space. And as a payer, we have to be able to meet those providers where they are in that capability space. Our Carebook team manages that digital interface.

Can you speak to physicians’ success, to date, in working with you in those measurement arrangements?

An early understanding of where their opportunity is, in terms of quality improvement—understanding where those gaps exist, and the tools that exist to address those gaps, early on as possible, is the most important element.

In what direction do you see your programs heading, over time?

We’d love to see an increase in participation, even at 66 percent now. We want all the groups in those programs to be successful. All three of us—the patient, the provider, and the health plan—all win, when they’re succeeding in these programs. So, growth, success, and I would say, expansion; so as we look at other value-based models, that’s a critical focus for these programs.

Can you say a few words about the hospital-based program?

Yes. This is our first program we have focused on improving quality delivered in the inpatient setting. Incentive arrangements are relatively new, and of course, new to Humana. Our number-one goal there aligns with the goals of our primary care programs, and that is being focused on hospitals succeeding in all the measures we’ve stablished in the program.

Can you say how many hospitals are participating so far?

We’ll release that number soon.

Is there anything you’d like to say to the healthcare IT leaders in our audience?

Recognizing the capabilities and influence that we all have in interacting together to help this model succeed, that’s crucial. The cooperation of everyone to help drive success, is critical.




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