Health Leadership Task Force

1. Oregon Educators Benefit Board November 12, 2009 Denise Honzel, Consultant, HLTF Jack Friedman, Chair, Benefits Work Group Dr. Terry Olson, Co-Chair, Evidence Based Group Health Leadership Task Force

2. Goals for today Provide an overview of the work of the Health Leadership Task Force Discuss and get your feedback on two of the initiatives -- value based benefit design -- high cost medical imaging 2

3. The Health Leadership Task Force Commissioned by the business community in the summer 2008 Goal�Develop solutions and actions to keep health care costs and premium increases closer to the CPI Sponsors: Legacy, Kaiser, ODS, OHSU, PacificSource, Providence, Regence Other Health Plans and Hospitals helping financially

4. How work is being accomplished Task Force of 28 health care leaders to review and support recommendations Four work groups with 120+ members -- Value Based Benefits -- Evidence Based Best Practice -- Reimbursement and Payment Reform -- Administration Simplification 4

5. Accomplishments to Date Completion of a value-based benefit design for the large group market Implementing an initiative in the management of high cost imaging Moving forward on two payment reforms-medical home and medical devices Building improved efficiencies in credentialing and provider access to information 5

6. Value Based Benefit--Goals Reduce financial barriers for the management of chronic care Support wellness, prevention and a culture of health Reduce the use of nationally recognized (Wennberg/Fisher) care that, for a population, is driven by provider preference or supply rather than evidence Achieve a 10% reduction in premium 6

7. Design Features: Three Tiers Tier One: Chronic care management for six conditions (Depression, CHF, CAD, Diabetes, COPD, Asthma) No Deductibles No/minimal co-pays/co-insurance Generic Prescriptions Condition specific labs/imaging/tests Primary care office visits, if feasible

8. Design Feature�Tier Two Wellness benefits can be covered in either Tier 1 or 2 and could include preventive care, screenings, immunizations, and preventive dental for chronic conditions Employers encouraged to provide proven health strategies All other medical services (not covered in Tier 1 or 3) will be subject to the standard deductibles/co-insurance/out-of-pocket

9. Design Feature�Tier Three Preference/supply sensitive treatments subject to separate/higher (2X) the deductible/co-insurance/out-of pocket Treatments covered under Tier 3; 18.4% all expense --Upper Endoscopy --Hysterectomy --MRI, CT, PET --ED Visits --Spine surgery --PTCA/Stents --Orthopedic joints: knees, hip, arthroscopies, shoulder surgery for osteoarthrosis

10. Observations Inpatient expenses 1/3 of �Tier 3� Outpatient expenses 2/3 of �Tier 3� Estimated 12% of enrollees each year will have a �Tier 3� claim -- 90% of these will be an ER expense Expense trend unchanged from non-Value Based designs -- Subject to trend leveraging of �Tier 3� cost sharing

11. Advantages of the Design Rational benefit design that encourages the most effective care with more appropriate incentives More laser like plan design that can achieve a potential 8-12% medical cost reduction To achieve the same savings, a $2000 deductible plan would need to go to $3000 Engages employers and employees in discussing plan design in a new way But�.might be too early�we hope not, you tell us

12. To support product success Employer, member and provider education/communication is key Importance of keeping both Tiers 1 and 3 to achieve price point Importance of keeping to nationally recognized list under Tier 3 If offered as an option to employees, they need to see the lower price point

13. Who will offer to large groups in 2010 Lifewise Q3 ( 51+ employees) ODS Q1 (100+ employees) Providence Q2 ( 51+ employees) Regence Q3/4 ( 51+ employees) PacificSource Q3/4 (250+employees)

14. Next steps and your thoughts Each Plan will take the basic design and develop final product and plan for market introduction Meet with employers to get feedback and determine interest in offering this as an option Seek ways to introduce this product into the small group market

15. Evidence Based Best Practice-Goals Develop strategies that will reduce the high cost medical areas and achieve benchmark targets through sharing best practice Three options considered --High Cost Imaging --Management of low back pain --Primary care management of depression

16. First Focus: High Cost Imaging High Cost�est. $300-$400million/year Rising utilization and cost: --10-12% annually in Oregon --17% annually in US (Medicare) Quality concerns: inappropriate use Patient safety concerns: unnecessary patient exposure to radiation leads to increased health hazard

17. Oregon�s Current Activities Many Health Plans have implemented or are planning to implement initiatives to manage imaging utilization -- AIM (American Imaging Management) is most common vendor -- Some using prior notification, some prior authorization Kaiser Permanente has guidelines and decision support embedded in electronic health record system design

18. Next Steps Phase 1: Each Plan fully implements utilization management initiative and evaluate progress toward defined metrics in Dec. 2009/June2010 Phase 2: Develop point-of service decision support approach if these initiatives do not achieve goals Work with DHS to advance this initiative

19. Critical Success Factors Critical mass of Plans using a consistent approach Use of well-established clinical guidelines (ACR, ACC) Collaborative process with providers Rigorous measurement and feedback tools Patient education and engagement with purchasers

20. Administrative Simplification Three workgroups: Claims, Eligibility and Credentialing Identified many opportunities for more efficient use of resources Initial focus: -- Each Plan will enhance web-site capability to reduce provider calls -- Single source portal for MD�s -- Centralized source for credentialing -- Common elements for insurance cards credcredcrecredentialingintroduction

21. Next Steps Determine implementation schedule for each initiative Identify next areas of opportunity for increase efficiencies and develop work plans for implementation

22. Payment and Reimbursement Reform Two areas of focus -- Medical Home -- Medical Devices Medical Home Goals -- Achievement of overall cost, quality, access and satisfaction outcomes -- Help revitalize/transform primary care

23. Medical Home Focus on chronic care first, then expand Determine measures of success and payment methodology Obtain critical mass of plans/purchasers to participate Develop criteria to select provider groups�goal statewide Many groups may be ready to move forward without infrastructure investment�for those needing help, looking at process for funding

24. Next Steps Establish a small steering group to drive this work, reporting to HLTF (including 2 purchasers) Have contracted with national expert to help advise group in carrying out the work plan Group will review existing work and determine best approaches for payment, selection criteria, measurement, etc Goal�get project launched by the spring of 2010

25. Medical Devices�The Problem Large variation in the number and cost of devices physicians use in surgery Hospitals need to carry the inventory Physicians usually order what they have been trained on Minimal incentives to use equally effective, lower cost devices

26. Medical Devices�Next steps Small group developing an approach that will provide better incentives to use a more limited, high quality list of devices�possibly p4p Proposals would be given to the hospitals, for discussion with the MD�s Could some of the savings be used to re-train MD�s and support staff?

27. Summary Great progress since fall 2008 Value Based Benefits ready to be discussed as an option with large employers Movement from the Plans to address one of the high cost areas�imaging Starting to make some progress on administration simplification Payment reform concepts moving forward

28. Next Steps We will continue to push forward with our work, it�s an imperative for Oregon�s business and its� citizens We have had initial discussions with the State about their plans and how this work could support their efforts, more to come We will continue to involve and report our progress to the business/purchaser community For more information: www.HealthLeadershipTaskForce.org