Value-based Purchasing

1. Value-based Purchasing Jude Odu Senior Business Analyst, Health Care DataWorks Detlev“Herb” Smaltz, PhD Co-Founder & CEO, Health Care DataWorks September 27, 2012

2. Speaker Jude Odu • Senior Business Analyst and Healthcare Subject Matter Expert at Health Care DataWorks • Former Supervisor for Clinical Analytics and Decision Support, University Hospitals Case Medical Center, a multi-hospital health system in Northeast Ohio • 14+ years in long-term care, in acute care, and on the payer side • Instructor in healthcare informatics at Ursuline College • Master’s degree in Health Science, The George Washington University

3. Speaker Detlev H. (Herb) Smaltz, Ph.D., FHIMSS, FACHE • Co-Chairman and CEO, Health Care DataWorks • 21+ years experience in healthcare management • Former CIO of The Ohio State University WexnerMedical Center • Fellow of the Healthcare Information & Management Systems Society (FHIMSS) • HIMSS Board of Directors (2002-2005) and Vice Chair (2004-2005) • Fellow in the American College of Healthcare Executives (FACHE) • Bachelor’s degree in MIS, University of Tampa, MBA, The Ohio State University, and Ph.D. in Information & Management Science,Florida State University

4. Today’s Webinar • Value-based Purchasing (VBP) • What is it? • Who came up with it? • When does it happen? • Who does it affect? • Why should I care? • How do I recover reimbursements withheld through this program?

5. What is VBP?

6. VBP Final Rule • VBP was established by the Affordable Care Act of 2010 (ACA) • Budget neutral payment changes begin October 1, 2012 • Reduce base operating payments for each discharge by • Rewards for achievementorimprovement

7. VBP Measures – FY 2013

8. 2 Ways to Earn-Back ImprovementHospital Performance Standards Baseline: Hospital performance for all 20 metrics during the Baseline Period Performance: Hospital performance for all 20 metrics during the Performance Period

9. Timeline Final Payment Adjuster Delivered Hospitals will be informed of VBP payment at least 60 days in advance of the payment year Estimated Payment Adjuster Delivered Nov Aug 2009 2010 2011 2012 2013 July March July March FY 2013 Performance Period FY 2013 Baseline Period

10. 2 Ways to Earn Back or ImprovementHospital Performance Standards Baseline: Hospital performance for all 20 metrics during the Baseline Period Performance: Hospital performance for all 20 metrics during the Performance Period Achievement CMS Performance Standards Benchmark: Mean of top decile performance (95th percentile) nationally Threshold: 50th percentile performance nationally Floor (HCAHPS only!): Minimum performance nationally

11. What does VBP mean for me?

12. The Questions • Do you know your VBP score? • Do you know how much is projected to be withheld? • Can you get to the data to understand your score? • Can you pinpoint which measure is costing you most? • Can you build a plan to improve your score? • How can you maximize your earnback?

13. The People • Financial Management • Wants to earn back the money CMS withheld • Quality & Clinical Management • Needs to understand VBP scores • Take action to improve processes that target nurses, doctors, housekeeping staff, nursing units, etc.

14. The Challenges • Hospitals and their technology solutions have evolved as siloed point solutions

15. The Challenges • Data, systems and technologies are virtually everywhere with limited commonality in format and accessibility

16. The Challenges • So you can’t get the information you need when you need it!

17. The Opportunity • Get as much money back as possible • Improve hospital performance across measured areas

18. How do I manage this?

19. Common Approaches Hospitals vary in their approach: • Implement stand-alone solution • Retain consulting firms • Manage compliance manually • Figure it out later

20. There’s a Better Way • Unified VBP Application • Automate the collection of all data required • View the organization across all 20 measures • Evaluate root cause of positive or negative results • Calculate how score improvements increase reimbursements

21. Typical Health System Thousands of hours of manual labor Nursing Dashboard ED Dashboard CBO Dashboard Surgery Dashboard VBP Dashboard ICU Dashboard Reports Dashboards Access Manual & Semi-Manual Departmental Analytics Initiatives Exploring Crimson Surgery Compass Essbase Diver Cerner Insight Cognos Invision Ad hoc Signature Ad hoc DM Hyperion Signature Surgery TSI Premier Lab Cerner eClinical Invision ERP Lawson Cerner Kronos Morrissey Vision VisionW Prism

22. Analytics at Many Hospitals and Health Systems Transactional Systems Islands of Data End User Reporting abc12349x abc12349x abc12349x W External Systems 22

23. Ad-hoc Query Unified Analytics via an EDW Internal Systems Transformation and Mapping EDW End User Reporting Clinical Trial Screening Multi-Dimensional Analysis & Data Mining SOA/Web Services GL PA Cleanse Validate Standardize Transform Aggregate Geo Code Data Profile Data Model Meta Data Load HR Revenue Cntrct Rejection Encounter EMR Pt Sat Text Mining, NLP Time SIS Meds PM Lab Web Scorecards & Dashboards Cost Orders Predictive Modeling SIS Census De-identified Data Errors Unified data Model Readmits W Benchmarking Registries Research META DATA External Systems DATA GOVERNANCE

24. Additional Value Effective VBP management will lead to positive change: • Improve the quality of patient care as a result of operational enhancements • Increase management visibility • Increase accountability across the organization • Decrease workforce burden • Estimate and manage financial implications

25. Takeaways/Summary • The CMS VBP program is here and will continue to evolve • A portion of your CMS reimbursements will be withheld starting Oct. 1 and will increase through 2017 • In the absence of a unified solution, managing VBP will require heavy lifting

26. Questions? Herb Smaltz, Ph.D., FHIMSS, FACHE 877 979 4239 herb.smaltz@hcdataworks.com