How to Calculate Financial Risks and Optimize the Rewards ......Executive Sponsorship. Staff and Team Roles. Scope of Work for Upstream Interventions. Project Management of Upstream

How to Calculate Financial Risks and Optimize the Rewards of Upstream CareRISHI MANCHANDA MD MPHPRES IDENT, HEALTHBEGINS

V ICTOR TABBUSH PHDSENIOR FELLOW, HEALTHBEGINSADJUNCT PROFESSOR EMERITUS , UCL A ANDERSON SCHOOL OF MANAGEMENT

By the end of this session, attendees will be able to:• Identify barriers facing community-based organizations (CBOs) to participate in sustainable partnerships with health systems.• Describe a tool to calculate financial risks and rewards for CBOs that partner with health systems to address social needs for high-need, high-cost individuals •List ways to ensure that cost savings from clinical-CBO partnerships reach CBO partners and help fund upstream prevention

Learning Objectives

Why do we need to optimize financial risks & rewards?

What are the challenges facing Community-Based Organizations (CBOs)?

VBP (Value-Based Payment) creates opportunities

• CMS and some states are aggressively moving to VBP

• In NY, 80% of all Medicaid provider payments must be value based by

• VBP creates a new business case for partnerships between

providers and CBOs to address Health-Related Social Needs (HRSNs)

We improve care andthe social determinants of health by making clinical-community partnerships more effective and efficient

About HealthBegins

Our clients and partners include the American Hospital Association, Medicaid health plans, large hospitals and healthcare delivery systems, community health centers and self-insured employers. In 2017, HealthBegins was selected to provide technical assistance to CMS Accountable Health Communities model grantees.

Challenges for CBOs

Valuing CBO services provided to the patient, especially in ways that the health system recognizes

Predicting the costs involved with providing services to the patients

Representing the costs and benefits to the health care system

Communicating and advocating for their own organizational interests

Creating a formal agreement – or multiple formal agreements – around a partnership

An illustrative example of how we help clinical and community partners to improve care and social determinants of health.

Meet Mrs. M She’s a 46 year old mother of two who also cares for her frail elderly mother.

Her Type II diabetes is poorly controlled (last HbA1c = 8.1). She has mild heart failure with preserved ejection fraction. At the end of last month, she nearly fainted at work and was admitted at a local hospital.

The cause of her admission was hypoglycemia (low blood sugar).Root cause: Food insecurity

Lower-income diabetic adults have a 27% higher rate of hospital admissions at the end of the month due to food insecurity, compared with higher-income diabetics. Seligman HK, et al. Health Affairs. 2014;33(1):116–23

A step-wise approach to charting a course upstream

Identify our:1. Priority populations2. Priority social determinants of health3. Existing barriers and solutions4. Early wins 5. Roadmap to achieve early wins

For example, Adult diabetics with high rates of preventable hospitalization within 4 zip codes in your shared catchment areaThe more precise the definition, the better.

1. Pick a Priority population

Identify our:1. Priority populations (e.g. Diabetics like Mrs.M)

2. Priority social determinants of health3. Existing barriers and solutions4. Early wins 5. Roadmap to achieve early wins

2. Pick a “Root Cause” social determinant of health or health-related social need, based on your priority population.

The more specific, the better.

For example, Food insecurity

Identify our:1. Priority populations (e.g. Diabetics like Mrs.M)

2. Priority social determinants of health (e.g. Food Insecurity)

3. Existing barriers and solutions4. Early wins 5. Roadmap to achieve early wins

We recognize that stakeholder prioritiesoften differ by level of prevention

PrimaryPrevention

SecondaryPrevention

TertiaryPrevention

Primary prevention is concerned with preventing the onset of disease; it aims to reduce the incidence of disease.

Secondary prevention is concerned with detecting a disease in its earliest stages, before symptoms appear, and intervening to slow or stop its progression: "catch it early."

Tertiary prevention refers to interventions designed to arrest the progress of an established disease and to control its negative consequences.

Source: University of Ottawa. https://www.med.uottawa.ca/sim/data/Prevention_e.htm

Stakeholder priorities also differ by level of intervention

Patient /ClientLevel of Intervention

Organization Level of Intervention

CommunityLevel of Intervention

Interventions directed toward individual beneficiaries (e.g. patients, clients)

Interventions directed toward organizations and their stakeholders (e.g. employees, vendors, partners, investors)

Interventions directed toward entire communities or broad populations(e.g. zip codes, cities, states)

3. The Upstream Strategy Compass helps clinical and community stakeholders map existing and potential solutions for defined populations and social needs

(example: diabetes and food insecurity)

Upstream Strategy CompassTM

PatientLevel of Intervention

PrimaryPrevention

Financial literacy, support, & nutrition programs for low-income families with strong family history of DM

Provide on-site Farmers’ Market, gym, walking trails, or financial counseling for employees and dependents

Support ban on trans fats or a tax on refined grain products with added sugar, with subsidy support for healthier foods

SecondaryPrevention

Poverty screening & financial assistance for DM patients at-risk of end-of-month hypoglycemia

Subsidize vouchers to a farmer’s market, incorporate the DPP into benefits plan for prediabetic employees

Change timing and content WIC & school food programs to avoid food insecurity among DM

TertiaryPrevention

Reduce hospital use among high-utilizer diabetics using medically-tailored meals

Coordinate with local banks, collectors, lenders, to reduce debt burden for utilizer diabetics

Support legislation/ regulations to provide financial and “hotspotter” services to severe diabetics

Upstream Strategy CompassTM. Manchanda R. HealthBegins. Adapted from Chokshi and Farley (2012); Gottlieb et al. (2013); Cohen and Swift (1999); and Leavell and Clark (1965). Abbreviations: DM, diabetes mellitus.

Our path to building upstream capability and impact

Go 3. Go Upstream with QI Using the Upstream Quality Improvement toolkit, launch rigorous, targeted campaigns to redesign systems and workflows to dramatically improve your health and social outcome measures.

1. Get ReadyTake the Upstream Capability Assessmentto assess your healthcare system’s readiness to effectively address social determinants of health.

2. Get SetBased on your level of readiness, our experts & coaches help you identify a priority population, an upstream problem, relevant partners and data to move upstream.

Health system and CBO leaders each complete an organizational Upstream Capability Assessment, an online tool to identify strengths and areas for improvement in ten domains of performance.

Get Ready:

Financial readiness is a core capability for upstream partnerships

The External Environment

Perceived Value of Moving Upstream

Executive Sponsorship

Staff and Team Roles

Scope of Work for Upstream Interventions

Project Management of Upstream Interventions

Workflow Integration

Quality Improvement

Organizational Infrastructure

Financial readiness

Opportunities for CBOsVBP is about taking on risk for performance◦ Think long and hard about who holds the risk

CBOs may only view contracts with health systems as a “grant”. That misses the real opportunity. ◦ Instead, CBOs can pivot to a shared savings model in which upside is linked to

performance.◦ Larger CBOs are generally better positioned to share in upside savings and,

potentially, be exposed to downside risk.◦ Even for CBOs that operate on shoestring budget, there are absolutely

opportunities to share in upside savings.

Source: Jason Helgerson, former Medicaid Director, NYS

Community-based organizations (CBOs) need to identify real costs and calculate potential risks and rewards for providing services in a health system-community

partnership

How do we do this?

PrimaryPrevention

SecondaryPrevention

TertiaryPrevention

The ROI Calculator helps CBOs estimate financial risks/rewards for interventions for high-need, high cost patients

The Time Has Come for Cross Sector Partnerships to Serve HNHC Populations

Social Service Sector Health SectorCross Sector

Partnerships

Impact

Lower Medical

Utilization Incentive

Partnerships Need To Be Mutually Advantageous

ReturnRisk

There are financial consequences for both – returns and the risks surrounding their receipt.

Total Return

Return to CBO

Return to Health System Partner

Payment to CBO

Returns Depend On CBO Value, Cost & Payment Level

CBO Cost

Value is the financial benefit to the health system partner of the social service.

Risk Depends On Uncertainty About Effectiveness and Costs

Effectiveness risk: The social services do not perform as expected.

Cost risk: The social services cost more than

expected.

CostRecovery

Fee perService

Fee perCase

Fee perPerson

Gain Sharing

Payment System Determines Division of Risk

Using The Tool: Example of CTIA hospital and a CBO are negotiating to partner in providing home and community-based services for discharged patients at risk for readmissions & ED visits.

The service portfolio is comprehensive

◦ Nutritional support

◦ Transportation

◦ Home health nursing

What is the ROI?

Should payment be a 30-day bundled rate for all required services, or payment on a fee-for-service basis? Or gain sharing?

Step 1: Select Services and Targets

Step 2: Establish Baseline Utilization

Step 3: Estimate Cost of Medical Events

Step 4: Estimate Population to Receive Each Service & the Service Intensity

Step 5: Estimate Service Costs

Step 6: Estimate Impact on Utilization

Step 7:Select Payment Systems

Step 8: Review Results

Step 9: Assess Risk

How can we ensure that cost savingsfrom clinical-CBO partnerships reach

CBO partners and help fund upstream prevention?

Calculate returnsPatient/TeamLevel of Intervention

General PopulationLevel of Intervention

PrimaryPrevention

SecondaryPrevention

TertiaryPrevention

Reduce hospital use among high-utilizer severe diabetics using food and income support

Upstream Strategy MatrixTM. Manchanda R. HealthBegins. Adapted from Chokshi and Farley (2012); Gottlieb et al. (2013); Cohen and Swift (1999); and Leavell and Clark (1965). Abbreviations: DM, diabetes mellitus.

The ROI Calculator helps CBOs estimate financial risks/rewards for interventions for high-need, high cost patients

PrimaryPrevention

SecondaryPrevention

TertiaryPrevention

Plan to reinvest or reallocate cost savings from downstream wins to support upstream solutions

Reallocate and reinvest

Build and transfer capability to community

Plan and structure contracts to: • Optimize and align financial risk/rewards between CBOs & HC• Align payments with disparity targets• Require transfer of resources, performance management +/-

technology capabilities from healthcare to social, public health and civil society organizations.

◦Need a proactive strategy that involves communication/engagement/training◦ For example, in NY DRSIP Medicaid Redesign efforts, ◦ In 2018, more advanced value-based payment contractors (providers) must address at least one SDOH and must contract with a CBO to do it.

◦NYS and participating providers held bootcamps, specifically targeted to CBOs

Investing in CBOs

Thank you! Rishi ManchandaPresidentHealthBegins

rishi@healthbegins.org

www.healthbegins.org

(818) 333-5005

info@healthbegins.org

How to Calculate Financial Risks and Optimize the Rewards ......Executive Sponsorship. Staff and Team Roles. Scope of Work for Upstream Interventions. Project Management of Upstream

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