1 Emerging Mega-Trends in Healthcare and Implications for Providers of Services to Persons with Developmental Disabilities in New York State New York State.

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Emerging Mega-Trends in Healthcare andImplications for Providers of Services to Persons with

Developmental Disabilities in New York State

New York State Association of Community and Residential Agencies

James W. LytleManatt Phelps & Phillips

December 4, 2014

2Agenda

Overview of megatrends in larger health and human services environmentImpact of megatrends on New York State policy development Discussion of implications for the developmental disability field in New York and beyond

3Healthcare Megatrends

• More with Less, Volume to Value• Consumers Take Charge• Employers Recalibrate• Mega-Health Systems• Healthcare Everywhere• Value Through Data• Predict, Prevent, Personalize• The New Aging• The Centrality of States• The Globalization of Healthcare

4Megatrend 1: More with Less, Volume to Value

Innovative payment mechanisms and

value-based purchasing (vs.

traditional fee-for-service) to ↑ quality

and ↓ cost

Supporting higher-quality outcomes and greater satisfaction, while reducing costs

Re-pricing of physician specialty

services; emphasis on re-balancing primary care; more targeted

use of specialty services

Satisfying provider supply through:

expanded role and scope of practice for

non-MDs; new models of mid-level providers and team-

based care

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New York: The Cost and Value Proposition

NY is remarkably slow and cautious

on scope of practice issues for an allegedly

progressive State

Payment/Delivery System Reform & Scope of Practice

RRecent progress on NPs,

pharmacists and extending

exemptions from Nurse Practice

Act

Decades of increasing reliance on

managed care for Medicaid newly focused on DD

Field

Persistent experimentation in

payment methodologies:

Rate Rationalization and DSRIP value-based payments

DISCO

6$8 Billion in New Federal Funding

Interim Access Assurance Fund, $500 million

Other MRT Purposes, $1.08 billion

Planning Grants, $70 million allocated, $21.6M

awarded

State Program Administration, $300 million

Performance Payments,

$6.048 billion

DSRIP,$6.42 billion

Overall pot to be allocated,

depending on application

valuation, into Public Hospital and Safety Net

Funds

10% of each fund set-aside for high

performance payments in years

2 through 5

Potential Reductions in

Federal Funding for Failure to

Meet Statewide Metrics,

$381 million

7Overview of DSRIP

New York State (NYS) received federal approval to implement a Delivery System Reform Incentive Payment (DSRIP) program that will provide funding for public and safety net providers to transform the NYS health care delivery system.

Goals:

(1) Transform the safety net system

(2) Reduce avoidable hospital use by 25% and improve other health measures

(3) Ensure delivery system transformation continues beyond the waiver period through managed care payment reform

Key Program Components: Statewide funding initiative for public hospitals and safety net

providers Only coalitions of community/regional health providers are eligible DSRIP projects based on a menu of interventions approved by CMS

and NYS Payments to providers based on their performance in meeting

outcome milestones and state achieving statewide metrics

8DSRIP Projects Menu & DomainsEach DSRIP “Performing Provider System” selects at least 5 projects (and no more than 10 projects) from the following menu:

Domain 1: Overall Project

Progress

Domain 2: System Transformation Projects (must include at least two projects)

• Create integrated delivery systems (required)

• Implementation of care coordination and transitional care programs

• Connecting Settings

• Patient and community activation

Domain 3: Clinical Improvement Projects (must include at least two projects)

• Behavioral health (required) • HIV

• Cardiovascular health • Perinatal

• Diabetes Care • Palliative Care

• Asthma • Renal Care

Domain 4: Population-Wide Prevention Projects (must include at least one project)

• Promote mental health and prevent substance abuse

• Prevent chronic diseases

• Prevent HIV and STDs

• Promote Healthy Women, Infants and Children

9Value-Based Payments

• Movement to coordinated care did not alter fee for service status quo

• Goal: At least 90 percent of plan payments are required to be value-based by 2019

• Value-based payments involves Plan to individual PPS provider, Plan to PPS and Plan-PPS-Provider arrangements

• Examples may include: Bonuses or penalties based on quality Shared savings Upside/downside risk sharing Bundled payments with outcome-based component Capitation with outcome-based component

10Megatrend 2: Consumers Take Charge

Consumers become “active shoppers,”

able to compare and select products,

utilizing data made available on smart

phones and in social media

Increasing role of the consumer in healthcare decision making

Consumers bear more risk, particularly

through higher cost sharing and high deductible health

plans

Individuals and communities increase focus on the impact of

personal behavior, including diet,

exercise and home-based self-care

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NYS: Consumers & System Transformation

OPWDD and Consumer-Direction

Consumer-direction has become a key element of

residential, employment and related reforms throughout

OPWDD System Transformation

12Megatrend 3: Employers Recalibrate

The employer-sponsored insurance landscape is shifting

As landscape for employers as purchasers becomes more complex and regulated, employers may pool

interests and purchasing power

Employers moving toward dropping coverage for retiree beneficiaries and

shifting individuals to the Marketplace, and/or using a voucher

system for current beneficiaries to purchase insurance on private/public

Marketplaces

13NYSACRA Members as Employers

Employee health benefits in ACA environment

Coverage for Associations and the self-employed under the ACA: Freelancers

dilemma and new ERISA standards

State intervention to protect against

surprise bills and limits on out of

network limitations and costs—and premium review

Skinny networks, greater cost-sharing,

limits on out of network access,

prescription drug concerns

14Megatrend 4: Mega-Health Systems

Merging of payers, providers results in mega-healthcare

systems managed by giant organizational

entities

Mergers & Acquisitions

A

Roles of providers and payers shift to

increase focus on delivering the “right

care, at the right place, at the right

time” via joint ventures and partnerships

Increase in payers’ use of utilization

controls and narrow networks creates concern regarding limited consumer

choice

ACCESS

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New York State: Mergers/ACOs/PPSs

Consolidation of payors and providers

present new competitive concerns with legal/regulatory

implications

Mergers & Acquisitions

Mergers and other affiliations of

providers becoming more common as

strategy to address current fiscal and

operational challenges

Accountable Care Organizations and PPSs—provider-

based, collaborative, non-MCO models—pose challenges to

plans, smaller providers

16Megatrend 5: Healthcare Everywhere

Shifting from care delivered in healthcare facilities to home and communities

Care may move from acute to ambulatory settings, where consumers spend their time

(e.g., retail clinics, homes) and where care can be delivered by

lower-cost providers

Tools (e.g., smartphones, social media, sensors, text messaging)

empower consumers and physicians with more options for where and

how to treat, particularly remotely and from home

17New York: Convenient & coordinated care

Shifting from institutional-based care to home and communities

Expanding ambulatory, urgent care, freestanding

emergency room and retail care options—and implications for

more traditional providers

Transformation of home and

community-based services for the

elderly and persons with disabilities

through coordinated care.

Patient care monitoring

technology, new diagnostic and

treatment modalities present new opportunities

and new challenges.

Telehealth technologies offer

new opportunities,

challenge state-based licensing

quality oversight

18Megatrend 6: Value Through Data

II

Increasing demand for ability to access and analyze huge amounts of data

Integration of clinical, molecular and demographic data will drive new R&D for

the pharmaceutical and medical

device arenas

Insurers and providers will begin to create and analyze giant data sets to support

quality improvement, planning, population health management

and cost effectiveness

19New York: Data-focused health policy

MRT focus on data, reliance on

real-time all-payor claims

information and analytics

Data-driven health policy and new privacy concerns

Electronic prescribing: new

challenges for healthcare

practitioners in digital age

The SHIN-NY, RHIOs and the

health information technology

revolution—and privacy concerns

20Megatrend 7: Predict, Prevent, Personalize

Genomics brings personalized medicine and

predictive diagnostics

Medical care personalized at an individual-by-individual level

Emergence of cybernetics, cloning

and regenerative medicine

Rise of ethical concerns related to scientific advances

21New York: Bioethical Challenges

NY has (slowly) reached consensus on a host of difficult

issues, including surrogate decision-making, genetics,

FHCDA

The New York Experience with Key Ethical Issues in Medicine

21st century may promise new genetic

interventions to predict & prevent

developmental disabilities—and new

ethical quandaries as a result.

22Megatrend 8: The New Aging

Enhanced focus on self-care, connected care, and

monitoring/assistance that allows individuals to receive care at home

longer; enhanced focus on managing chronic disease

Impact of the population becoming proportionally older

Increased role for family care giving; increased

impact on health of family care givers; increased need

for end-of-life care planning

Continued shift in Medicare to managed care

organizations; increased focus in states on dual

eligibles

23Aging caregivers and workforce

Implications of aging caregivers on loved ones

with developmental disabilities, leading to new and desperate concerns for

services

Significance of aging on caregivers, professionals and volunteer workforce

Health care workforce shortages compounded by

pending retirements of direct service professionals

and other caregivers, leaving NYers without care.

Demands on workforce to undertake family caregiving responsibilities impacts on healthcare professionals

and volunteers

24Megatrend 9: Centrality of States

Medicaid

expansion brings

the program

squarely into health

insurance market;

concerns regarding

sustainability of

growing program

surface

Expansion of Medicaid and reforms of state programs

Alignment of public

coverage with

private insurance

New focus on

delivering

integrated services

for medical care,

behavioral care,

public health

Increased use of

managed care,

including for

populations that

have been last to

transition

25Why Advocacy in New York is so important

State’s vigorous healthcare and

nonprofit regulatory role makes NYS of central importance

New York plays extensive role in overseeing health care issues

His

Prolonged and persistent

dysfunction in D.C.—and relative

success in governance at NYS-level—underscores importance of state-driven public policy

While federal role in overseeing

healthcare has grown, State’s

responsibility for Medicaid and new

FIDA initiative makes NYS key player for public

programs

Historic and longstanding

constitutionally- based role of

state in serving persons with

mental disabilities

26Challenges and opportunities: Tale of Two Cities

• Workforce COLA implementation Credentialing Progress Justice Center and background checks Continuing recruitment/retention challenges

• Fiscal Support State budget status CMS takeback

• Pace and scope of change Well-intended and progressive vision Overtaxed state resources/personnel Overwhelmed field

27Challenges and opportunities: Tale of Two Cities

• Federal-state relationship Continued support in Obama Administration Presidential prospects for Hillary Clinton Diminished role for NY in Congress Congressman Issa and CMS view of NYS

Medicaid • Complicated political environment

Strong support in legislature for field Committed and capable leadership Recent vetoes of legislation to reform front

door and related planning bills

28Prognosis

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James Lytle

Partner  [email protected]  

Manatt Phelps & Phillips, LLP              30 South Pearl Street

Suite 1200  Albany, NY  12207

(518)431-6704