Health Care Reform 2014: Implications for Professional Practice Dan Abrahamson, PhD Assistant Executive Director Kansas Psychological Association April.

Health Care Reform 2014: Implications for

Professional Practice

Dan Abrahamson, PhDAssistant Executive Director

Kansas Psychological AssociationApril 5, 2014Wichita, KS

Compelling Need for U.S. Health Care Reform

About 50 million uninsured Americans

Annual health expenditures of over $2.7 T

Health costs comprise about 17% of GNP

Fragmented system with variable quality

Increased life expectancy but often with chronic illnesses

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The Economic Context for Reform

2010 Healthcare expenditure = $2.7THealthcare is single largest

contributor to national debt: Medicare = 15%; Medicaid = 8%; Social Security = 20%; Defense = 20%

All Health Expenditures, 2009:Private @ 51% (34% Ins. & 13% out of

pocket)Public @ 49% (Fed @ 37%, Mcare @ 22%,

Mcaid @ 16%)

By 2020, Fed. Govt. will pay 49% of all

health

State budgets in worst shape since

WWII

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Economic Context: Mental Health

Largest purchaser of MH/SUD services is the government!

Mental Health Spending, 2009:Private insurance, 26%; Out-of-pocket,

11%; Charity, 3%Public funding, 60%

Medicare, 13%Medicaid, 27%Other federal, 5%Other state/local, 15%

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Economic Context : Mental Health

Mental Health Spending Trends• 1986 = 7.3% of all health spending• 2003 = 6% of all health spending• 2009 = 6.3% of all health spending• 2014 = 5.9% of all health spending

Spending by provider class: Psychiatrists = 6% of all mental health $$ Non-psychiatric physicians = 5% Psychologists/SW/Cs = 5% or 0.315% of total

mental health $$; psychologists only 16% of this provider group

Hospitals = 26% Specialty MH/SUD = 30% Insurance Administration = 7%

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Mental Health: Shifts in Spending

Source: Substance Abuse and Mental Health Services Administration. (2011). National Expenditures for Mental Health Services & Substance Abuse Treatment 1986-2005. Washington, DC. As cited in Kaiser Commission on Medicaid and the Uninsured. (April 2011). Mental Health Financing in the United States: A Primer. Washington, DC.

Distribution of Mental Health Expenditures by Type of Service, 1986 and 2005

7% Prescription Drugs

$32 Billion $113 Billion

19%Inpatient

33%Outpatient

Economic Context: RxP and Mental Health

RxP: 50% of increased MH spending 1998-2004

RxP: 3X growth rate as other services

RxP: 28% of all MH spending in 2009• New drugs/new generics/patents expiring• Fewer side effects• More PCPs comfortable with prescribing• 66% spent on antidepressants and

antipsychotics• 14% spent on ADHD medications

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Treatment Settings for Behavioral Health Care

Source: Kaiser Commission on Medicaid and the Uninsured. (April 2011). Mental Health Financing in the United States: A Primer. Washington, DC.

Types of Mental Health Services Used in Past Year, Among Adults Receiving Treatment, 2009

Economic Context for Reform: Chronic Illness

Healthcare costs in 2009:1% population = 21.8% of costs10% population = 63.6% of costs50% of population = only 2.9% of costs

Medicare spending:• 5% beneficiaries = 43% costs• 25% beneficiaries = 85% costs• 50% beneficiaries have >5 chronic

illnesses

Medicaid spending:• 15% are disabled and = 43% of costs• 10% are elderly and = 23% of costs• Summary: 25% of population = 66% of

costs 9

Patient Protection and Affordable Care Act of 2010

Culmination of a 100-year effort that challenged five former presidents

Comparable with passage of the Social Security Act in 1935 and Medicare in 1965

Almost on par with Civil Rights legislation in the 1950s and 1960s

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Controversial Aspects of Health Care Reform

Cost estimate of $180 billion over 10 years (Congressional Budget Office, 2012, prior to Supreme Court ruling)

Individual mandate to purchase health insurance or pay a penalty upheld by Supreme Court ruling, June 2012

Medicaid expansion by states funded mostly by federal government with threatened loss of current funding for noncompliance. Loss of current funding not upheld by Supreme Court

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Key Challenges Facing Health Care Reform

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Overall Goals of Health Care Reform

To preserve employer-based health insurance

To expand coverage to 32 million more Americans (Medicaid, Insurance Exchanges)

To improve quality of care by addressing the needs of the whole patient through:Preventive ServicesPrimary and Integrated Care

Reduce growth rate of healthcare costs13

ACA Expands Eligibility & Coverage

Medicaid expansion covers persons up to 133% of FPL by 2014 (adds 16-22M)

Health Insurance Exchanges (up to 400% of FPL)

Essential Health Benefits with parity for Medicare Advantage, Medicaid Managed Care, CHIP, and Benchmark Plans

Preventive Care and Wellness

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Insurance Market Reforms in Affordable Care Act

No lifetime or annual dollar limitsNo rescissions of coverage except for

fraudCoverage of pre-existing conditionsGuaranteed coverage acceptance and

renewalRequirement of effective appeals

processEstablishment of premium rating

requirementsProhibition of participant and provider

discriminationState consumer assistance offices

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ACA Impacts Care Delivery

Accountable Care Organizations (ACOs)composed of integrated provider networks with:shared electronic records evidence-based practice protocolsoutcomes measurementperformance incentives

Patient-Centered Medical Homes (PCMH) will have features similar to ACOs

Home and Community Based Services Options

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Why Focus on Integrated Care?

Aspects of overall health are missed by sole focus on physical or mental health

Behavioral factors are leading causes of chronic illness and mortality

Chronic illness accounts for 75% of nation’s health spending

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Why Focus on Integrated Care?

Adults with Mental Health Conditions

29% of Adults with Medical Conditions Also Have Mental Health Conditions

68% of Adults with Mental Health Conditions Also Have Medical Conditions

Source: Druss, B.G., and Walker, E.R. (February 2011). Mental Disorders and Medical Comorbidity. Research Synthesis Report No. 21. Princeton, NJ: The Robert Wood Johnson Foundation.

Percentage of Adults with Mental Health Conditions and/or Medical Conditions, 2001-2003

Adults with Medical Conditions

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Prevalence of Behavioral Health Conditions in US

Percent of US Adults Meeting Diagnostic Behavioral Health Criteria, 2007

Source: Kaiser Commission on Medicaid and the Uninsured. (April 2011). Mental Health Financing in the United States: A Primer. Washington, DC.

Comorbidities Compound Costs

Monthly Health Care Expenditures per Person for Chronic Conditions, with and without Comorbid Depression, 2005

Source: Melek, S., and Norris, D. (2008). Chronic Conditions and Comorbid Psychological Disorders. Cited in: Druss, B. G., and Walker., E.R. (February 2011). Mental Disorders and Medical Comorbidity. Research Synthesis Report No. 21. Princeton, NJ: The Robert Wood Johnson Foundation.

Interaction Between Medical Disorders and Mental Illness

Model of the Interaction Between Medical Disorders and Mental Illness

Source: Druss, B. G., and Walker., E.R. (February 2011). Mental Disorders and Medical Comorbidity. Research Synthesis Report No. 21. Princeton, NJ: The Robert Wood Johnson Foundation.

RISK FACTORS

Childhood Adversity

Stress

SES

- Loss- Abuse and Neglect- Household Dysfunction

- Adverse life events- Chronic stressors

- Poverty- Neighborhood- Social Support- Isolation

Chronic Medical Disorders

Adverse Health Behaviors and Outcomes- Obesity- Sedentary Lifestyle- Smoking- Self care- Symptom Burden- Disability- Quality of Life

Mental Disorders

Why Focus on Integrated Care?

At least half of mental health treatment is provided in primary care

High co-existence of physical disorders and behavioral health problems

Adults with SMI in public sector die younger ( by 25 years)due to untreated physical health problems

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Psychology’s Contributions to Integrated Care

Conducting thorough psychological assessments Treating more complex, complicated patients

Applying behavioral principles to modify health-risk factors

Promoting patient responsibility and resilience

Attending to interpersonal barriers to behavior change

Understanding environmental determinants of behavior, including impact of families and systems

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Psychology’s Contributions to Integrated Care

Supervision of M.A. level therapists, case managers

Development of programs designed to provide population-based care

Designing, monitoring, and evaluating interventions

Program administration Enhancing health team and

organizational development

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ACA Impacts Payment and Performance

Move will be away from Fee-for-Service

Global, bundled, episode paymentsPay for PerformanceHigher rates for PCPsMedicare Shared Savings & other

modelFQHC investment of $11BQuality Measures (11 of 51 are

behavioral health)

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The Healthcare Environment

Declining reimbursements Increased/incessant demands for cost

containment Increased cost of doing business (rent,

labor, equipment, insurance, etc.) Increasing “competition” in

psychotherapy marketplace Growing regulatory demands (billing,

privacy, confidentiality, patient consent, F-W-A, EHR, retirement planning, occupational safety, etc.)

Lack of negotiation leverage And ever escalating healthcare costs!

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Evolving Healthcare Landscape

Increased regulation of price and volume of psychological services by public/private payers

Rapid and large-scale consolidation of health insurance market leading to more payer power: providers have lower reimbursement and less autonomy and consumers have higher premiums

Professional, market, and regulatory developments encouraging more collaborative care practices

Emergence of new reimbursement mechanisms to replace FFS: P4P, Global payments, Episode of care payments, Shared Savings

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Evolving Healthcare Landscape

Federal/State policies pushing integration:

Quality payment programs with incentives to meet certain quality standards

Health Information Technology (HIT): cost and ability to meet “meaningful use” criteria to be eligible for incentives

Anti-trust Enforcement Policy: allows integrated provider organizations to negotiate with plans re: payment rates but groups without integration (financial and clinical) are prohibited from such negotiation

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Reasons to Integrate

Aggregate capital to finance, develop, implement and maintain infrastructure (HIT & data reporting systems) necessary to collect, track, and report quality information required for performance-based reimbursement mechanisms

Develop collaborative care systems necessary to achieve real quality improvement in patient care

Insurers, employers, consumers demanding data on provider performance: adherence to quality outcome and process measurement, patient satisfaction, cost of care

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Reasons to Integrate

Allows ability to collect your own monitoring and evaluation data that may be needed to correct inaccuracies in tiering or designations imposed on your practice by payers

Share risk as needed in capitated contracts where there will be high-cost patients

Negotiating efficiencies with TPAs by sharing a manager who can analyze and negotiate contracts

Larger integrated groups may be favored by payers due to geographic coverage, mix of services, etc.

#1 reason: Market a valuable/competitive product that you cannot produce acting independently

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Implications for Professional Practice

New care delivery models/systems: PCMHs, ACOs

New skills and training models for integrated, inter- professional team-based care

Implementing advances in telehealth, HIT, and electronic health records

Increasing demand for the use of EBPs (Evidence-based practices) and quality measures

Payment reforms: P4P, Global payments, Bundled payments, Shared-savings models

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Primary Work Setting of APA Practicing Psychologists

Independent solopractice

Institution-basedPractice

Independent Group practice

Academic: teaching and/or research

Other

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APA’s Health Care Reform Team

Staff Working Group:CEO, Deputy CEO, and Senior Policy

AdvisorGovernment Relations Offices: Practice,

Public Interest, Education, and SciencePublic & Member Communications Office

Involvement of APA Leadership and Members, as well as other organizations

Collaboration with the APA Practice Organization (APAPO) – APA’s affiliated 501(c)(6) entity that works to advance the interests of practitioners 33

The APA Center for Psychology and

Health

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APA Center for Psychology and Health

Organizational Chart

*The APA Practice Health Care Team and the State Implementation Advisory Group are combined APA Practice Directorate (c3) and APA Practice Organization (c6) activities.

Ellen Garrison, PhD Coordinator

APA Practice

Health Care Team

State Implementatio

n Advisory Group

Collaborating Units*

Health Leadership Team

Working Groupof APA Member

Primary Care Experts(TBD)

Director ofIntegrated Health

Care (TBD)Assistant

Coordinator

Health Team

Norman Anderson, PhDDirector

Randy Phelps, PhDOffice of

Health Care Financing

*The APA Practice Health Care Team and the State Implementation Advisory Group are combined APA Practice Directorate (c3) and APA Practice Organization (c6) activities.

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APAPO is dedicated to serving theinterests and needs of its members: APA members

who pay the annual Practice Assessment to APAPO.

The mission of the APAPO isto advance, protect and defend

the professional practiceof psychology.

APAPO Mission

501(c)(6) Business/Trade Association

As a 501(c)(6) organization, APAPO can:

Focus on advancing a particular trade – professional psychology

Engage in unrestricted lobbying Work with a political action committee to facilitate

political giving

Top Priorities for 2014• Medicare and Medicaid

reimbursement• “Physician” definition in

Medicare• HITECH incentive payments for

electronic health records

Legislative Advocacy

Medicaid: H&B Codes

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Serving SPTAs: 2013 CAPP Grant Examples

Minnesota•Pursuing funding for the development of electronic health records; ensuring psychologists role in behavioral health homes.

Vermont•Supporting the inclusion of psychologists in legislative process during Vermont’s restructure to a Single Payer Plan.

Kentucky•Ensuring parity in private insurance and Medicaid; addressing workforce capacity challenges with Medicaid expansion.

Georgia•Pursuing efforts to defend scope of practice regarding psychological assessments.

HEALTHCARE REFORM AT THE STATE LEVEL

Established in fall 2011 in response to the passage of the Affordable Care Act

Composed of the Practice Health Care Team and the State Implementation Advisory Group

Facilitated administratively through the State Advocacy Office

State Implementation Updates

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State Implementation Initiative & APA Communities

Launched by the association in April 2012. Designed as a professional network that enables users

to connect and work collaboratively online, in real time. Securely accessed via MyAPA ID. The APA Practice Initiative: State Implementation of

Health Care Reform is now using APA Communities to link leaders to resources and state efforts on health care reform.

www.apacommuniti es.org

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State Health Care Reform Group on APA Communities

A Document Library

Tools for State Leaders

A Discussion Forum

Categorization of Resources:Mental Health Priority Areas in ACA1. Accountable Care Organizations2. Health Care Financing3. Health Care Medical Homes4. Health IT5. Insurance Exchanges6. Integrated Care7. Medicaid Redesign8. Primary Care

Additional Categories:9. SPTA Health Care Summits10. Updates: APA State Implementation

of Health Care Reform

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SPTAs and Health Care Reform Education 2011New York State Psychological AssociationMassachusetts Psychological AssociationMaryland Psychological Association

2012North Carolina Psychological AssociationIdaho Psychological AssociationMaine Psychological AssociationCalifornia Psychological AssociationIndiana Psychological AssociationOregon Psychological AssociationWashington State Psychological Association

2013Connecticut Psychological AssociationWisconsin Psychological AssociationNevada Psychological AssociationMinnesota Psychological AssociationSouth Carolina Psychological AssociationRhode Island Psychological AssociationOhio Psychological AssociationOklahoma Psychological AssociationVermont Psychological Association

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Funding level maintained for 2014Organizational development,

legislative, emergency and Canadian$250,000 awarded in

organizational developmentgrants to 25 states andDC in 2014

$185,000 awarded inlegislative grants to 13 states in 2013 (for 2014)

Serving SPTAs: CAPP Grants

Contact Information

Phone: 1-800-374-2723

Web: www.apa.org

www.apapracticecentral.org

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