Utah hospital aug 2014

1. © 2014 IBM Corporation Smarter Care Paul Grundy MD, MPH - IBM Director, Healthcare Transformation August, 2014 Utah Hospitals Better Care, Reducing Costs, Improving service Population Health Patient Centered Medical Home

2. © 2014 IBM Corporation 2 Smarter Care Paul Grundy MD MPH Bio • “Godfather” of the Patient Centered Medical Home • IBM Global Director Healthcare Transformation • President of PCPCC • Member Institute of Medicine • Member Board ACGME • Professor Univ. of Utah Department Family Medicine • Winner NCQA national Quality Award • A Leader of MOH level taskforce primary care transformation 8 nations: USA, Canada, New Zealand, Australia, Holland, Denmark, UK, Belgium, • Univ. of California MD, John Hopkins Trained

3. © 2014 IBM Corporation 3 Smarter Care Population Health System Integrator Patient Experience The System Integrator Creates a partnership across the medical neighborhood Drives PCMH primary care redesign Offers a utility for population health and financial management Per Capita Cost Public Health Away from Episode of Care to Management of Population Hospital Community Health

4. © 2014 IBM Corporation 4 Smarter Care 4 0 1000 2000 3000 4000 5000 6000 7000 1980 1983 1986 1989 1992 1995 1998 2001 2004 United States Germany Canada France Australia United Kingdom Average health spend per capita ($US PPP) How do you start to fix the foundational issue around why our healthcare system is so expensive and yet so broken?? Source: K. Davis, C. Schoen, S. Guterman, T. Shih, S. C. Schoenbaum, and I. Weinbaum, Slowing the Growth of U.S. Health Care Expenditures: What Are the Options?, The Commonwealth Fund, January 2007, updated with 2007 OECD data

5. © 2014 IBM Corporation 5 Smarter Care Current Payment Systems Penalize Primary care Prevention Quality and Reward Volume We have discover the enemy --- we buy garbage!!!! IBM other large Buyers are demanding change in that (BIG TIME) Preventable Condition Continued Health Healthy Consumer No Hospitalization Acute Care Episode Efficient, Successful Outcome Complications, Infections, Readmissions High-Cost Successful Outcome $ Fee-for-Service Payment Pays More for Bad Outcomes and Less When People Stay Healthy IBM paying first $$ primary care!!

7. © 2014 IBM Corporation 7 Smarter Care 7 Reason IBM pays 1st dollar primary care “Not surprisingly, those patients with the strongest relationships to specific primary care physicians were more likely to receive recommended tests, medication adherence and preventive care. In fact, this sense of connection with a single doctor had a greater influence on the kind of preventive care received than the patient’s age, sex, race or ethnicity.” Patient–Physician Connectedness and Quality of Primary Care Steven J. Atlas, MD, MPH; Richard W. Grant, MD, MPH; Timothy G. Ferris, MD; Yuchiao Chang, PhD; and Michael J. Barry, MD 3 March 2009 | Volume 150 Issue 5 | Pages 325-335

8. © 2014 IBM Corporation 8 Smarter Care “We do heart surgery more often than anyone, but we need to, because patients are not given the kind of coordinated primary care that would prevent chronic heart disease from becoming acute.” -- George Halverson’s (CEO Kaiser) from “Healthcare Reform Now

9. © 2014 IBM Corporation 9 Smarter Care 36.3% Drop in hospital days 32.2% Drop in ER use 12.8% Increase Chronic Medication use -15.6% Total cost 10.5% Drop Inpatient specialty care costs 18.9%Ancillary costs down 15.0%Outpatient specialty down Outcomes of Implementing Patient Centered Medical Home Interventions: A Review of the Evidence from Prospective Evaluation Studies in the US - PCPCC Oct 2012 Smarter Healthcare

11. © 2014 IBM Corporation 11 Smarter Care 11 MOVING TOWARDS A MORE COORDINATED SYSTEM 11 Cooperating in new efforts to better coordinate care • Accountable Care Organizations (ACOs) • Community health teams • HIT Working with innovative reimbursement structures • Bundled payments • Expanded pay-for-Quality • Readmission incentives • Outlier reductions Improving health outcomes • Prevention (primary and secondary) • Chronic disease management • Patient engagement and education • Data transparency Patient Centered Medical Homes quality improving/value creating systems

12. © 2014 IBM Corporation 12 Smarter Care 12 HEALTH INSURANCE REFORM WILL IMPROVE THE WAY CARE IS DELIVERED FOR ALL AMERICANS 12 •Primary care has a critical role to play in reform •Health insurance reform will facilitate adoption of advanced primary care models (PCMH) Changes to the delivery system •Incentives quality not quantity of medical care •No cost sharing for preventive care •Better coordinate care for patients with chronic diseases •Ensure patients receive clinically recommended treatments and follow-up •Reduce duplicative testing and rehospitalizations •Integrate with community health resources to provide more holistic patient care •Expand coverage and access

13. © 2014 IBM Corporation 13 Smarter Care Maryland July 2014 -- CareFirst saved $267 million with its medical home • 11 percent fewer days in the hospital • 8 percent fewer hospital readmissions. http://www.fiercehealthpayer.com/story/medicaid-can-reap-rewards-medical-homes/2014-07-15

14. © 2014 IBM Corporation 14 Smarter Care Rural New York July 2014 Costs for Medicaid patients dropped from $334 to $266, according to a recent “risk adjusted” analysis. http://poststar.com/news/local/medical-home-program-gains-traction/article_5811380c-2ee9-11e3-8548-001a4bcf887a.html

15. © 2014 IBM Corporation 15 Smarter Care •9.9 percent lower rate of adult ER visits •27.5 percent lower rate of adult ambulatory care sensitive inpatient stays •11.8 percent lower rate of adult primary care sensitive ER visits •8.7 percent lower rate of adult high-tech radiology usage •14.9 percent lower rate of pediatric ER visits •21.3 percent lower rate of pediatric primary-care sensitive ER visits 24 July 2014 Michigan Blues’ patient-centered medical home program shows statewide transformation of care YEAR 6 4,022 primary care doctors at 1,422 practices around the state in its sixth year of operation. These practices care for more than 1.2 million BCBSM members

17. © 2014 IBM Corporation 17 Smarter Care 44% reduction in hospital costs 21% reduction in overall medical costs. 160 PCMH practices Pennsylvania from 2009 to 12 Number of patients with poorly controlled diabetes declined by 45% 44% reduction in hospital costs 21% reduction in overall medical costs. 160 PCMH practices Pennsylvania from 2009 to 12 Number of patients with poorly controlled diabetes declined by 45% http://www.ajmc.com/publications/issue/2014/2014-vol20- n3/Medical-Homes-and-Cost-and-Utilization-Among-High- Risk-Patients#sthash.qR8uWb4t.dpuf http://www.ajmc.com/publications/issue/2014/2014-vol20- n3/Medical-Homes-and-Cost-and-Utilization-Among-High- Risk-Patients#sthash.qR8uWb4t.dpuf PCMH Pennsylvania June, 2014 Conclusions: PCMH practices had significantly reduced costs and utilization for the highest risk patients, particularly with respect to inpatient care.

21. © 2014 IBM Corporation 21 Smarter Care Preventive Medicine Medication Refills Acute Care Nursing Test Results Master Builder DOCTOR Source: Southcentral Foundation, Anchorage AK Behavioral Health Case Manager Medical Assistants Chronic Disease Monitoring Practice transformation away from episode of care

22. © 2014 IBM Corporation 22 Smarter Care Medication Refills Chronic Disease Monitoring Test Results Acute Care Preventive Medicine Point of Care Testing Acute Mental Health Complaint Chronic Disease Compliance Barriers Healthcare Support Team Behavioral Health Medical Assistants Case Manager Provider Source: Southcentral Foundation, Anchorage AK PCMH Parallel Team Flow Design: the glue is real data, not a doctor’s brain

23. © 2014 IBM Corporation 23 Smarter Care Today’s Care PCMH Care My patients are those who make appointments to see me My patients are those who make appointments to see me Our patients are the population community Our patients are the population community Care is determined by today’s problem and time available today Care is determined by today’s problem and time available today Care is determined by a proactive plan to meet patient needs with or without visits Care is determined by a proactive plan to meet patient needs with or without visits Care varies by scheduled time and memory or skill of the doctor Care varies by scheduled time and memory or skill of the doctor Care is standardized according to evidence-based guidelines Care is standardized according to evidence-based guidelines Patients are responsible for coordinating their own care Patients are responsible for coordinating their own care A prepared team of professionals coordinates all patients’ care A prepared team of professionals coordinates all patients’ care I know I deliver high quality care because I’m well trained I know I deliver high quality care because I’m well trained We measure our quality and make rapid changes to improve it We measure our quality and make rapid changes to improve it It’s up to the patient to tell us what happened to them It’s up to the patient to tell us what happened to them We track tests & consultations, and follow-up after ED & hospital We track tests & consultations, and follow-up after ED & hospital Clinic operations center on meeting the doctor’s needs Clinic operations center on meeting the doctor’s needs A multidisciplinary team works at the top of our licenses to serve patients A multidisciplinary team works at the top of our licenses to serve patients Slide from Daniel Duffy MD School of Community Medicine Tulsa Oklahoma

24. © 2014 IBM Corporation 24 Smarter Care Superb Access to Care Patient Engagement in Care Clinical Information Systems, Registry Care Coordination Team Care Communication Patient Feedback Mobile easy to use and Available Information Defining the Care Centered on Patient

26. © 2014 IBM Corporation 26 Smarter Care Payment reform requires more than one method, you have dials, adjust them!!! “fee for health” fee for value “fee for outcome” “fee for process” “fee for belonging “fee for service” “fee for satisfaction”

28. © 2014 IBM Corporation 28 Smarter Care % Total Healthcare Spend % of Members Those who are well or think they are well Those with chronic illness Those with severe, acute illness or injuries Benefit Redesign - Patient Engagement Different Strategies for Different Healthcare Spend Segments

29. © 2014 IBM Corporation 29 Smarter Care 29 IBM’s Strategy Moves Costs From Below Market to Market Leader  Best in market purchasing strategy  Redesigned plan mix to use PPO model  Employee-centric allocation of IBM investment with dependent subsidy reduced  Investments in prevention, primary care and chronic disease management  Employee cost sharing keeps pace with inflation  Award-winning wellness strategy providing support for healthy living; onsite screenings and immunizations Source for benchmarks: Average of survey results from Kaiser Family Foundation, Hewitt Associates and Towers Perrin 4.8% 9.7% 4.5% 6.6% 10.6% 6.4% 7.0% 4.9% 2.2% 5.6% 4.6% 3.7% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 11.0% 12.0% 2004 2005 2006 2007 2008 2020099 NetIBMMedicalTrend Benchmark Net IBM Trend $1B Saved in 6 Years

30. © 2014 IBM Corporation 30 Smarter Care 30 © 2009 IBM Corporation6 IBM Population Risk Has Moved Toward Improved Health  Wellness programs have had a dramatic impact on the health of our employees – Percentage of employees with high health risks reduced by 55% – Percentage at low risk increased by double digits  Reduction in health risks translates into health claims cost reduction – Represents an almost $300 reduction in per employee costs or a $29M savings 2004 – 2007 Health Risk Assessment Participation *$392M = 2007 dollars applied to 2004 health risk profile. **Total costs based on 103K total self-insured population and represent employee costs only (not including dependents) Projected 2007 spend with no health risk improvement Actual spend $7,555 $4,638 $2,660 $392M* $363M** $29M (7%) difference 55.4% 68.3% 31.8% 26.0% 12.8% 5.7% 0% 20% 40% 60% 80% 100% 2004 Profile 2007 Profile %ofAllHRAParticipants High Risk (4+ risks) Medium Risk (2-3 risks) Low Risk (0-1 risk) Shift in Health Risk Profile = Savings in Healthcare Claims Costs Note: Includes ALL participants each year, NOT MATCHED SAMPLES 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% %ofAllHRAParticipants High Risk (4+ risks) Medium Risk (2-3 risks) 55.4% 59.2% 64.8% 68.3% 31.8% 30.2% 28.7% 26.0% 12.8% 5.7%10.6% 6.5% 2004 2005 2006 2007 (N=54K) (N=70K) (N=73K) (N=75K) Low Risk (0-1 risk) $363M $369M $383M $401M $398M $395M $392M $340 $360 $380 $400 $420 2004 2005 2006 2007 IBMMed&RxPaidClaimsCosts($M's) (Calculatedbasedon2007dollars) 2005 2006 2007 3 Year Total Est. savings between IBM health risk improvement & expected risk increase $12M $29M $38M $79M Total Wellness programs have had a dramatic impact on the health of our employees ‘04 to ’07 High health risk population reduced 55% Low health risk population increased 23% Reduction in health risks translates into savings in health claims costs compared to expected trends with no wellness interventions $279M estimated savings for 2004 to 2013 period Expected cost increase with no IBM population health risk improvement* With actual IBM population health risk improvement**

31. © 2014 IBM Corporation 31 Smarter Care Public Health Prevention Specialists PCMH 2.0 in Action Community Care Team Nurse Coordinator Social Workers Dieticians Community Health Workers Care Coordinators Public Health Prevention HEALTH WELLNESS Hospitals PCMH PCMH Health IT Framework Global Information Framework Evaluation Framework Operations A Coordinated Health System 35

32. © 2014 IBM Corporation 32 Smarter Care 2009 2010 2011 2013 2014 Percentage of Vermont population participating 6.7% 9.8% 13.0% 42.0% 86.0% Participating population 42,179 61,880 82,332 227,045 654,852 # Community Care Teams 2 3 4 6 11

33. © 2014 IBM Corporation 33 Smarter Care 33 The New Yorker: The Cost Conundrum June 1st 2009 • When you look across the spectrum from Grand Junction to McAllen you see A threefold difference in the costs of care— • you come to realize that we are witnessing a battle for the soul of American medicine. Somewhere in the United States at this moment, a patient with chest pain, or a tumor, or a cough is seeing a doctor. And the damning question we have to ask is whether the doctor is set up to meet the needs of the patient, first and foremost, or to maximize revenue. • The lesson of the high-quality, low-cost communities is that someone has to be accountable for the totality of care. Otherwise, you get a system that has no brakes. You get McAllen. • The foundation of this is at the Micro level someone has to be Accountable for your care -- that is the PCMH in most of the civilized world !!! • primary care doctors per 100,000 Grand Junction, 106, McAllen has just 45 • OR WHERE is the ADULT supervision!!!

35. © 2014 IBM Corporation 35 Smarter Care Hospital Payer EmployerCommunity Government Primary Care Provider Other Caregivers Pharmaceutical Manufacturers Nurse Specialists Social Worker PCMH Patient The PCMH model impacts stakeholders across the continuum of care Pharma: Improved communication platforms and relationships with healthcare providers, patients and payers; increased sales through improved patient identification, diagnosis, and treatment; recognized as a key player in the patient health delivery value chain Payer: Improved member and employer satisfaction, lower costs, opportunity for new business models Employer: Lower healthcare costs, more productive workforce, improved employee satisfaction Government: Lower healthcare costs, healthier population Patient: Better, safer, less costly, more convenient care and better overall health, productive long-term relationship with a PCP Primary Care Provider: Increased focus on the patient and their health, greater access to health information; higher reimbursement; more PCPs Specialists: Better referrals, more integrated into whole patient care, better follow up less rehospitalizations Hospital: Lower number of admissions and readmissions for chronic disease patients; able to focus on acute care issues

37. © 2014 IBM Corporation 37 Smarter Care 1. Pursue Electronic Patient Management and engagement rather than Electronic Patient Records 2. Bring to bear upon every patient encounter what is known rather than what a particular provider knows. 3. Make it easier to do it right than not to do it at all. 4. Continuous performance improvement. 5. Infuse new knowledge and decision- making tools throughout an organization instantly.

38. © 2014 IBM Corporation 38 Smarter Care 6. Establish and promote continuity of care with patient education, information and plans of care. 7. Enlist patients as partners and collaborators in their own health improvement. 8. Evaluate the care of patients and populations of patients longitudinally. 9. Audit provider performance based on the Consortium for Physician Performance Improvement Data Sets. 10. Create multiple case-management tools which are integrated in an intuitive and interchangeable fashion giving patients the benefit of expert knowledge about specific conditions while they get the benefit of a global approach to their total health

39. © 2014 IBM Corporation 39 Smarter Care Practices Features -- - Emphasis on care coordination and system navigation, System Integrator, PCMH role for family physician in integrated system - Big push on population health management - Care teams with PCP + a variety of other professions, e.g., nursing, pharmacy, public health and mental health. Technology Use - Better population health data stemming from centralized data based EHR through integrated system. - Adoption of telemedicine, Establish Primary Care Technology Center (PCTC), a research and training entity, to fuel adoption of efficacious technology in practice, patient engagement tools. Modern, flexible, sophisticated system, developed in partnership with technology providers. -Multi-modal communication w/ patients .

40. © 2014 IBM Corporation 40 Smarter Care Building a Workforce -- Training in the use of population health management, data management and public health tools - Dual degrees – MD + MBAs, MPHs - .Add’l training in interprofessional collaboration, EHR data usage, and integrated practice management. Research Focus -- Conclusive evidence about system wide quality improvement and cost savings of robust primary care.- Rise of Continuum-Based Research Networks, applied research efforts to improve clinical pathways. - Research builds case for reductions in Total Cost of Care (at system level), research into technologies most inpactful on Triple Aim. - FM becomes trusted source of best practices to meet Triple Aim, .Focus on issues that relate to patients owning their own health through patient experience and engagement research

41. © 2014 IBM Corporation 41 Smarter Care Collaboration -- - Family medicine’s partnership with payers and the integrated systems, to exchange ideas about how to best deploy family physicians and represent their colleagues’ interests to these systems - Subspecialists – to ensure great working relationships within systems. - Primary care professionals – to achieve the best possible outcomes in service of Triple Aim. Payers, particularly CMS – to ensure success of alternative payment pilots.- Primary Care Nurse Practitioners (to work together in pursuit of expanded role of Primary Care, Technology manufacturers) to provide advice on how to improve technology in use by FPs, Key Investments -- Curricular overhaul and research effort to prepare residents for work in integrated systems, tools for data being made into actionable information in population management, advance clinical decision support

43. © 2014 IBM Corporation 43 Smarter Care A comprehensive approach helps reduce costs while improving care Apply new insights from interactions and outcomes to enable continuous transformation LEARNING Identify and influence individuals and populations, and recognize intervention opportunities INTERVENTION COORDINATION Deliver care and monitor progress across clinical and social requirements COLLABORATION Assess and engage individuals and stakeholders to drive individualized care plans Drive evidence-based and standardized care planning KNOWLEDGE WELLNESS 43

46. © 2014 IBM Corporation 46 Smarter Care Trademarks and notes © IBM Corporation 2014 • IBM, the IBM logo, ibm.com, and Cúram are trademarks or registered trademarks of International Business Machines Corporation in the United States, other countries, or both. If these and other IBM trademarked terms are marked on their first occurrence in this information with the appropriate symbol (® or ™ ), these symbols indicate U.S. registered or common law trademarks owned by IBM at the time this information was published. Such trademarks may also be registered or common law trademarks in other countries. A current list of IBM trademarks is available on the Web at “Copyright and trademark information” at ibm.com/legal/copytrade.shtml. • Other company, product, and service names may be trademarks or service marks of others. • References in this publication to IBM products or services do not imply that IBM intends to make them available in all countries in which IBM operates.

47. © 2014 IBM Corporation 47 Smarter Care Objectives 1) Participant will understand/be able to discuss the important trend of PCMH in health care 2) Participant will understand/be able to explore the rationale and supporting evidence for PCMH 3)Participant will understand/be able comprehend the impact on patients, providers and payers Disclosure – I am a full time Employee of IBM –IBM and other PCPCC executive member companies have supported by talks on PCMH.

Utah hospital aug 2014

Utah hospital aug 2014

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