Health Care Reform : What Can The States Do?

1. Health Care Reform : What Can The States Do? Kenneth E. Thorpe, Ph.D. Robert W. Woodruff Professor and Chair Department of Health Policy and Management Rollins School of Public Health Emory University kthorpe@sph.emory.edu Wisconsin legislature, September 12, 2008

2. Overview • Crafting effective health reform solutions requires a clear diagnosis of what accounts for the growth in spending • Key “facts” context: • 75% of total health care spending linked to chronically ill patients • Chronically ill receive approximately 56% of all clinically recommended medical care • Rise in prevalence of treated disease accounts for two-thirds of the growth in health care spending. Wisconsin legislature, September 12, 2008

3. Overview • Rise in obesity prevalence in US accounted for 20-30% of the growth in health spending over the past 20 years. • Substantial dollar volume rise in spending linked to modifiable individual risk factors. Up to 80% of diabetes, hypertension, stroke, heart disease and 40% of cancer cases can be prevented if: • We reduce rates of smoking, improve diet, exercise and reduce the level and growth in obesity in the state. Wisconsin legislature, September 12, 2008

4. State Roadmap for Health • Long-term outcomes • Reduce the statewide prevalence of chronic disease • Improve the quality of care and health status of those with chronic disease • Lower the cost of treating chronic illness • Reduce the level and growth in health care spending • Reduce the number without access to care, or uninsured Wisconsin legislature, September 12, 2008

5. Vision--Full Integration: Population Based and Chronic Care Case Based State wide Model HEALTH IMPROVEMENT DISEASE MANAGEMENT Lifestyle interventions Low risk At risk Early Signs Symptoms Disease Disease Management Preventive Services Case Management Screening Acute treatment Disease Management Primary and Secondary Prevention HEALTH MANAGEMENT POPULATION-BASED CASE-BASED Wisconsin legislature, September 12, 2008 18

6. How to Get There: Roadmap Organizational Structure • Creates five committees tasked to develop statewide system of chronic care and prevention (lifestyle change), administrative simplification and HIT for all —the uninsured, privately insurance, Medicaid, and Medicare Wisconsin legislature, September 12, 2008

7. Challenges and Opportunities • Several activities on-going in some of these areas • Developing common vision and statewide approach up front (now) before its too late • Making sure that multiple approaches do not develop independently of each other • Assuring statewide reduction in costs • Developing innovative approaches for prevention and treatment of the uninsured Wisconsin legislature, September 12, 2008

8. Workgroup Topics and Workplan • Health system change (examples) • Develop common approach for building integrated chronic care delivery model used by all payers • Create medical home approach that could be used by all payers, including the uninsured • Develop new “value-based” benefit design around chronic disease (e.g. no cost sharing on clinically recommended treatments for diabetes, hypertension). Rely on widely agreed upon protocols. • Create new incentives for more effective self-management. (e.g. % diabetics measure blood sugar at least once per week) Wisconsin legislature, September 12, 2008

9. Workgroup Topics/Plan • Health system redesign • Recommend new payment models for supporting the development of a medical (health home) home structure statewide • Develop community level implementation strategies for the deployment of the chronic care delivery model • Develop models (FQHC or others) that provide timely care for the uninsured. Wisconsin legislature, September 12, 2008

10. Health Care Home • Have working definition for statewide use—physician led, multidisciplinary team • Will develop three tiers using NCQA scoring • Other issues— • Additional PMPM payments rise with tiers • PCP may contract with existing resources—home health, dm vendors, hospitals, others • Pay for performance issues Wisconsin legislature, September 12, 2008

11. Administrative Simplication • Strategic goal: implement coordinated, improved, simplified claims administration and other procedures to reduce admin costs. • Potential areas: • Maximize electronic claims process • Simplify EOB and patient bills • Uniform provider credentialing (council for affordability quality credentialing) • Improving efficiency of claims adjudication Wisconsin legislature, September 12, 2008

12. Statewide IT • Strategic goal: All providers, hospitals, insurers in the state will have access to a comprehensive inter-operable health information system • Objectives: Develop statewide, integrated, inter-operable electronic health information infrastructure. Move toward all health care providers adopting electronic records by date certain. Wisconsin legislature, September 12, 2008

13. Wellness and Obesity • Strategic objective: reduce the level and growth in obesity in the state over the next 5-10 years. • Targets: school, community and workplace interventions • Identify establish promising and effective approaches in these settings to increase exercise, increase fruit and vegetable consumption, reduce smoking. Wisconsin legislature, September 12, 2008