Bending the Cost Curve: The Role of Employers Karen Bray, PhD, RN VP, Clinical Care Services, Optima Health November 4,

1. Bending the Cost Curve: The Role of EmployersKaren Bray, PhD, RNVP, Clinical Care Services, Optima HealthNovember 4, 2011

2. Creating a Culture of Health Employer Group Focus Member/Employee Focus Physician Focus

3. Challenges of Health Cost Management

4. Health Care Costs Health Care Costs are exploding In 2008 healthcare represented 17% of GDP Expected to reach 20% in 2017 Employers are looking for fast and effective cost-reduction alternatives relative to health care premiums. Chronic care costs are exploding. The numbers of people with diabetes is up by 50 percent since 1990. New technologies are expanding the scope and reach of care. Heroic medicine is commonplace … and very expensive. Miracles happen routinely.

5. Health care costs by age group $10,000 $9,000 $8,000 $7,000 Cost Per Person Per Year $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 2-6 0-1 7-18 19-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 Age Group Source: Milliman USA 2002 Health Cost Guidelines

6. International perspective Health Care Spending per Capita, 2005 Source: OECD Health Data 2007

7. Health status and outcomes Life Expectancy at Birth, 2004-5 Source: OECD Health Data 2007

8. Health status and outcomes Infant Mortality, 2004-5 Source: OECD Health Data 2007

9. Financing Where the Health Care Dollar Went, 2003 Source: Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group

10. American health care "gets it right“ 54.9% of the time. McGlynn EA, Asch SM, Adams J, et al. The quality of health care delivered to adults in the United States. N Engl J Med 2003; 348(26):2635-45 (June 26).

11. Other statistics: Patient non-compliance causes 125,000 deaths annually in the U.S. – “Compliance Packaging: A Patient Education Tool,” D. Smith, American Pharmacy 50 percent of all prescriptions filled are taken incorrectly. – U.S. Chamber of Commerce $177 billion is spent by the U.S. health care system every year to treat medication error-related problems. – Med Ad News, 2001

12. Variations in Medicare Spending Dartmouth Atlas Report Dramatic variations in spending between 1992 and 2006 Miami increase by 5% annually San Francisco increase by 2.4% annually Medicare savings of $1.42 Trillion if all regions grew at SF rate Technology as the culprit? Evidence from regions based on fee-for-service Differences in organizational and local physician decision-making are key

13. Virginia Variations:Medicare spending per enrolleeAdjusted for inflation Range of 2.90% Richmond to 4.66% Winchester

14. End of Life Care Miami, last six months of life You will see doctors (mostly specialists) 46 times You will spend > 6 days in ICU, and have a 27% chance of dying in the ICU Portland, last six months of life You will see doctors (mostly primary care) 18 times You will spend 1 day in ICU, and have a 13% chance of dying in the ICU You will likely die at home with hospice support 27% of Medicare annual $327 M budget is for last year of life Dartmouth Atlas Project, 2009

15. Rising Employee Health Costs The Employer’s Perspective

16. Chronic Disease Conundrum 75%+ of health care dollars spent on chronic conditions Diabetes Obesity Cardiovascular Disease Asthma Most preventable through positive health habits Chronic disease continues to rise at alarming rate

17. Wellness Program Conundrum Historically, wellness programs achieved modest results Appeal to healthy employees who are already committed to health Significant health improvements achieved when employees with greatest health concerns Engaged & Motivated to make healthy choices Carrot Approach Reward employees Reduce insurance premiums

18. Engaging Leadership:The Cost of Doing Nothing Assumptions Annual Employee Health Care Costs of $1,325,000 480 Employees 8% Annual Cost Increase 33% of employees are obese 20% of employees smoke

19. The Cost of Doing Nothing Wellsteps.com ROI calculator

20. Reduce Obesity from 33% to 25% In an employee group of 480, obesity decreases from 158 employees to 120 Wellsteps.com ROI calculator

21. Obesity and Absenteeism Wellsteps.com ROI calculator

22. Reduce Tobacco Use from 20% to 15% In an employee group of 480, tobacco use decreases from 96 to 72 Wellsteps.com ROI calculator

23. Smoking and Absenteeism Wellsteps.com ROI calculator

24. The Cost of Doing Nothing Wellsteps.com ROI calculator

25. Employer Group: Clinical Report

26. Health Risk Factors/Presence of Chronic Illness Identified for Sample Group

27. Employer Group: Financial Report

28. The Employee Focus

29. Total Health: How Long, How Well We Live ~ 40% Behavior: tobacco use, nutrition, Weight, MDD (movement deficit disorder) ~ 30% Genetics Environment/public health ~20% ~10% Health Care Delivery US Dpt of Health and Human Services, Public Health Service. Healthy People 2010: National Health Promotion And Disease Prevention Objectives.

30. Engagement Tactics • Methods to Engagement: • Trinkets and T-shirts 10-15% • Merchandise Raffles (iPods, WII) 15-30% • Cash Incentives (under $100) 35-75% • Healthcare Premium Reductions 50-80% • Rewards to Healthcare spending vehicle 50-80%

31. The Physician Focus Primary Care Redesign

32. Challenges of Transformation Optima / SMG Clinical Integration Activities Outcomes Clinical Chronic Disease Incentive Measurement Analytics & Population Programs & Reporting Operational Management Coordination P4P Program PCMH Outcomes Diabetes Study PCMH Incentive Population Profiles Program Heart Failure Measurement & Monthly Meetings Re porting Creating a Partnership • Foundations • Trust • Collaboration • Mutual Respect • Valuable Contributions • Lessons Learned • It takes time • It is not easy • Worth it!

33. Population Analysis: Definition & Top ETGs

34. Population Analysis: Pharmacy & Inpatient

35. Chronic Disease Burden is Growing - Increasing incidence of disease + aging population U.S. healthcare Still Producing Marginal Quality Escalating Healthcare Costs - Primary Care most cost effective Medical Student Specialty Trends Stress of Overloaded Primary Care Practices Compensation of PCP vs Specialists Patient Care Growing Increasingly Uncoordinated Primary Care Is In Need of a Lifeline: Current Model is Not Working

36. Patients are… Wanting more control, more information, and more input Concerned about escalating costs Unhappy with the increasingly uncoordinated care Wanting better “integration of care” Patients want the system to be “Patient Centered” Patients Are Feeling the Effects 36

37. Care Team Capabilities and Optimized Technology Bringing it All Together to Benefit the Patient • Providers Organized as Care Teams, Each Performing at the Highest Level of License • Access to the Right Provider at the Right Time • ElectronicRecord and Registry Capabilities to Coordinate Care for the Chronic Disease Patient • Improved Clinical Outcomes • Fundamentally Redesigning the Delivery of Primary Care

38. Primary Care Redesign Guiding Principles

39. Imperative to Transform Primary Care Today Redesign Alternative Visit Considerations

40. The Evolution of Access

41. The Evolution of Access

42. The Evolution of Access +

43. Before Same Day Appointments Claire is sick with a headache and cough… and it’s 5pm. She calls the doctor’s office and gets the After Hours nurse who recommends calling her PCP in the morning. Not feeling confident she can get an appointment, Claire goes to the closest Urgent Care or Emergency Department instead.

44. The Need for Same Day Appointments The Issue: Access to primary care has been proven to provide better quality at lower cost However… In some clinics, schedule nearly full at the start of the day Many patients don’t bother calling Here is an opportunity for change.

45. After Same Day Appointments Now, Claire has 2 options: Call tomorrow morning and see her personal physician OR their partner. 2. Call the After Hours nurse that night, and she can be scheduled for an 8 am appointment. Goal: Reduce Avoidable ED Visits, Patient Satisfaction

46. Before Post-Hospital Discharge Follow-Up Protocol Drew, a 61 year old male is admitted with emphysema, cared for by a hospitalist, and discharged with instructions to follow-up with his PCP. Drew gets (expensive) new medicines, doesn’t know what they’re for, and is unsure about continuing his old medications without talking to his PCP. Drew calls his PCP for a follow-up appointment and is scheduled in his physician’s first open slot – 3 weeks from the day he called. Relapse… readmission.

47. Follow-Up after Hospital Discharge Why this is Important: Vulnerable period 50% of patients do not know their medications at the time of discharge 50% of patients do not understand their discharge instructions F/u appointment with PCP not guaranteed Poorly managed “Transition” = readmission Early follow up reduces readmissions

48. After Hospital Discharge Follow-Up Protocol • New Protocol: • Drew’s doctor/nurse is notified of discharge • Daily staff huddles to discuss patients like Drew • Follow-up appointment scheduled within 7 days • Medications reviewed/reconciled • After-Visit Summary provided • The Result: • Drew recovers and returns to work Goal: Reduce Readmissions by Managing the Transition

49. Before MyHealth Champion James is a 62 year old with heart failure who has been doing ok but has not been seen in months. Hilga notes her husband’s weight is up and calls the doctor’s office… but he is out that day and the nurse refers him to the ED. ED doctor discovers 20 lbs weight gain, fluid in the lungs and James is admitted to the hospital. “failed” outpatient management.

50. Introducing MyHealth Champion • A Valuable Addition to the Care Team: • Embedded case manager • Part of health team • Continuous relationship • Manages transitions, proactive outreach • Works to coordinate care with different health providers • Objective: • Reduce admissions, readmissions • Reduce avoidable ED visits