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Building a New Partnership for Value

Mike Englehart
President Advocate Physician Partners

Event Title: Innovative Care Delivery Models: Payor Provider Partnerships to Improve Health & Lower Costs Location: Washington, DC

Date: Wednesday, April 17, 2013

Discussion Topics
Advocate Health Care Overview Why we Entered into this Arrangement Key Drivers New Competencies Results Challenges

$4.7 Billion Annual Revenue AA Rated 12 Acute Care Hospitals 1 Childrens Hospitals 5 Level 1 Trauma Centers 4 Major Teaching Hospitals 4 Magnet Designations Over 250 Sites of Care Advocate Medical Group Dreyer Medical Clinic Occupational Health Imaging Centers Immediate Care Centers Surgery Centers Home Health / Hospice Physician Membership 1,200 Primary Care Physicians 2,800 Specialist Physicians Total membership includes 1100 Advocate-employed Physicians Central verification office certified by NCQA 9 Physician Hospital Organizations ( PHOs) 230,000 Capitated Lives / 700,000 PPO Lives / 245,000 Attributable Lives
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Advocates Physician Platform


Total physicians on medical staffs = 6,500 Total APP Physicians = 4,100

Employed/affiliated = 1,100

Independent APP = 3,000

Independent non-APP = 2,400

AMG (employed) = 900

Affiliated (Dreyer) = 200

Two Years Ago


Blue Cross Blue Shield of Illinois (BCBSIL) & Advocate/APP faced 2 choices:
Lower unit cost now
Partner together/reduce inefficiencies

Employers demanding change Prepares for Medicare value based purchasing Prepares for Medicare Shared Savings Program - MSSP (ACO) Prepares for Exchange price point in 2014
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BCBSIL Contract Highlights


Blue Advantage (BA) small network HMO added APP to network Feb. 2011
HMOI Risk adjusted global cost of care PPO - Shared Savings Model Measured on attributable patients Focus on trend in the total cost of care Need to attain outcomes, safety, and service targets

Value Based Agreements


Contract

BCBSIL
Medicare Advantage Advocate Employee Medicare ACO

Lives 380,000

Total Spend $1.8 B

32,000

$0.3 B

22,000 115,000

$0.1 B $1.2 B

Total
ACO=Accountable Care Organization

549,000
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$3.4 B

Changing Paradigms
From TO

Silo Care Management Enterprise Care Management Episodes of Care Discharges Utilization Management Caring for the sick Production (volume) Coordination of Care Transitions Right care, at the right place, at the right time Keeping people well Performance (value)

Key Drivers
Culture Feedback Loop

Governance

Transparency of Results
Incentives

Infrastructure

AdvocateCare Strategies & Tactics


Strategy
Outpatient Enterprise Care Manager (ECM)

Tactic Dedicated/embedded care


managers in physician practices for high-risk patients (2%-5% commercial population) Care Manager (CM) workload and predictive modeling system to target actionable patients Enhanced inpatient and ED care manager role Readmission risk tool Follow-up appt. with PCP office Medication reconciliation Physician-partnered CM model
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Inpatient ECM

What Results Have We Seen?


Bent the cost curve in 2011 and 2012 while maintaining or improving outcomes and satisfaction 2% HMO membership growth; market dropped >10% 11% PPO attributed patient growth

PPO In-network use up 3.4% points


APP physician membership growth
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What Results Have We Seen? (continued)


Outpatient Care Management - Early results for managed vs. control
group showing reduction in ED and Inpatient use

SNF Readmissions: 13.6% compared to national average of 20.3% SNF LOS: 19.2 days compared to national average of 27 days Transition Coach: 26% reduction in readmissions
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Biggest Challenges Moving Forward


Redesigning Primary Care-Advanced Medical Practice

IT Connectivity
In Network Care Coordination Discipline to create a standard approach Management / Governance Succession Planning

Patient Experience

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Ideal ACO Partnership


C Suite Leadership Engaged Transparency Regular, frequent meetings at various levels Full Data set exchange Multi Year Commitment Financial arrangement has to be win-win Grows market share

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Looking Ahead
Tighter attribution models

Benefit plan design to support in network care coordination


Narrow Networks - EPOs

2014 Exchanges Private and Public

EPO = Exclusive Provider Organization

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Questions?

Questions?