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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

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

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


Medicare Advantage Advocate Employee Medicare ACO

Lives 380,000

Total Spend $1.8 B


$0.3 B

22,000 115,000

$0.1 B $1.2 B

ACO=Accountable Care Organization


$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


Transparency of Results


AdvocateCare Strategies & Tactics

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

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

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

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


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


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