Challenges of Integrating Physicians John Cherf MD, MPH, MBA Chief of Orthopedics, Advocate IMMC President, OrthoIndex CMO, PinpointCare Kevin McCune, MD CMO, Advocate Medical Group Senior Medical Director, Advocate at Home Physicians Legal Issues Conference Chicago, IL June 9-10, 2016 At a Time When The Market Is Demanding Integration
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OrthoIndex™
Chicago, Illinois
OrthoIndex™
Chicago, Illinois
Challenges of Integrating Physicians
John Cherf MD, MPH, MBA Chief of Orthopedics, Advocate IMMC President, OrthoIndex CMO, PinpointCare
Kevin McCune, MD CMO, Advocate Medical Group Senior Medical Director, Advocate at Home
Physicians Legal Issues Conference Chicago, IL
June 9-10, 2016
At a Time When The Market Is Demanding Integration
OrthoIndex™ 2 OrthoIndex™ 2
I do not have any relevant financial relationships to disclose.
OrthoIndex™ OrthoIndex™
Review of Healthcare Reform Impact of New Payment Model’s on Physicians Preparing for the Future
Agenda
1996BRA, HIPAA
OrthoIndex™ 4 OrthoIndex™ 4
History of Healthcare Reform
Medicare (Part A and B) and Medicaid incorporated under Social Security Act 1965
Medicare introduces Diagnostic Related
groups (DRGs) 1983
Medicare Drug, Improvement, and Modernization Act
2003
1996 EMTALA, COBRA,
HIPAA
Deficit Reduction Act, Tax Relief and Health Care Act 2005
2006 Medicare Part D
1977 Health Care Financing Administration (HCFA) established within the Department of Health,
Education and Welfare (HEW)
1997 Balanced Budget Act
2015
Medicare Access and CHIP Reauthorization Act
(MACRA)
PPACA and HCERA (ACA) 2010
Source: OrthoIndex Analysis, 2015.
1996BRA, HIPAA
OrthoIndex™ 5 OrthoIndex™ 5
ACA: Key Components
PL 111-148, The Patient Protection and Affordable Care Act (PPACA), signed into law on March 23, 2010 Health Care and Education Reconciliation
Act (HCERA) of 2010, signed into law on March 30, 2010 Focus is largely on expansion of coverage
and insurance regulation Supports pilots and demonstrations
designed to control cost and reform care delivery (new payment models) and funds the Innovation Center Lays the foundation for more regulation
and oversight (MACRA)
MACRA = Medicare Access and CHIP (Children’s Health Insurance Program) Reauthorization Act.
1996BRA, HIPAA
OrthoIndex™ 6 OrthoIndex™ 6
New Payment Models Are About Managing Risk To A Budget
Lower Risk/ Value Potential
Higher Risk/ Value Potential
Fee-for-Service
Traditional Prospective Capitation
Risk-Sharing/ ACOs
Bundled Payments
Risk to Provider
Moving from a Fee-For-Service to a Value-Based Payment System
1996BRA, HIPAA
OrthoIndex™ 7 OrthoIndex™ 7
Transformation to a More Collaborative Healthcare Economy
IP
Lab
PAC
Home Imaging OP
Office
MD
IP = Inpatient, OP = Outpatient, PAC = post acute care..
1996BRA, HIPAA
OrthoIndex™ 8 OrthoIndex™ 8
2014
… efficient, coordinated and high quality care
A Commitment to Value and Quality
2016 2018 2011
68%
>80% 85% 90%
~20% 0%
30% 50%
Historical Performance HSS Goals
HSS = The Department of Health and Human Services; APM = Alternative Payment Model; FFS = fee-for-service. Source: CMS, 2015.
APMs (ACOs, Bundled Payments, etc.) FFS linked to quality All Medicare FFS
1996BRA, HIPAA
OrthoIndex™ 9 OrthoIndex™ 9
Medicare Access and CHIP Reauthorization Act of 2015 (MACRA)
Eliminates the SGR formula (and avoids a 21% cut) and provides new updates the Medicare Physician Fee Schedule (MPFS) Shifts MPFS to two new value-based physician payment tracks Merit-Based Incentive Payment System (MIPS) Alternative Payment Models (APM)
Encourages providers taking risk (two-sided) Bipartisan support suggest longevity beyond 2016 Provides clarity for future provider payments Continues the evolution of bundled payments
PP = private practice; MSG = multispecialty group. Source: AAOS Orthopaedic Practice in the U.S., January 2015.
_______________
~ 90% of Respondents
1996BRA, HIPAA
OrthoIndex™ 16 OrthoIndex™ 16
2012 to 2014: Significant Decline in Private Practice
Orthopedic Surgeon Practice Setting and Type, US Market Type of Practice 2012 2014 % Change Private Practice - Solo 18% 15% ↓21% Private Practice - Ortho Group 44% 35% ↓22% Private Practice - Academic 3% 3% ~ Private Practice - Multi-Specialty Group 9% 10% ~
Academic Practice - Salaried 9% 13% ↑ 44% Hospital Employment 9% 15% ↑ 88% Other 8% 9% ~
Source: AAOS Orthopaedic Practice in the U.S., 2010, 2012, 2014; OrthoIndex Analysis, 2015.
1996BRA, HIPAA
OrthoIndex™ 17 OrthoIndex™ 17
0%10%20%30%40%50%60%70%80%90%
100%
2004 2006 2008 2010 2012 2014 2016 2018
AIMMC AHC National
What is the Future of the Private Practice Workforce?
PP = private practice. Source: AAOS Orthopaedic Practice in the U.S., January 2015; OrthoIndex Analysis, 2015.
?
Single Specialty Orthopedic Private Practice, US Market
1996BRA, HIPAA
OrthoIndex™ 18 OrthoIndex™ 18
Preparing For Our New Customer
B2B Providers sell their services to the government, insurers and
employers who make decisions on behalf of
individuals and their families “wholesale”
B2C Providers sell their services
to consumers who make decisions on benefits,
providers and course of care
“retail”
Other Peoples Money
Your Money
B2B = business to business; B2C = business to consumer.
1996BRA, HIPAA
OrthoIndex™ 19 OrthoIndex™ 19
“The Patient Will See You Now”
Patients most frequently request pricing for obstetric services, imaging and outpatient surgery.
Insurance card
Procedure type
Treatment location
Verbal or written estimate within 2 business days
Consumer Driven Health Care
1996BRA, HIPAA
OrthoIndex™ 20 OrthoIndex™ 20
Our Market is Undergoing Transformational Change
Providers
Source: OrthoIndex Analysis, 2015.
Patient And Healthcare Asset Managers
1996BRA, HIPAA
OrthoIndex™ 21 OrthoIndex™ 21
Higher education, banking, healthcare …
The New “Cost Of Doing Business”
1996BRA, HIPAA
OrthoIndex™ 22 OrthoIndex™ 22
1996BRA, HIPAA
OrthoIndex™
Chicago, Illinois
OrthoIndex™
Chicago, Illinois
Thank You
John Cherf MD, MPH, MBA M: 312.339.4925 [email protected] 321 North Clark Street, Suite 1301 Chicago, Illinois 60654