Leveraging Health: Linking HPM to VBD

Cyndy NayerCo-founder and CEO

Leveraging Health:

Linking HPM to

VBD

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Disclosure

Nayer is on the speakers’ bureau for Merck

Nayer consults for Merck, Novo Nordisk, GSK, and several emerging health plans

April-May 2010

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New Board of Directors

Jan-Feb 2010

Buck ConsultantsCaterpillar [Michael Taylor MD] Johns Hopkins HealthCareCity of Cincinnati Journal CommunicationsCity of Springfield Or Greg JuddDetroit Regional Chamber of Commerce Jack Mahoney ~ Pitney BowesGenesis Health System Cyndy Nayer Goodyear/Whirlpool Partners in CareGroup Health Cooperative Plumbers and Pipefitters Local 525 H/W Fund

Bob Holben ~Gulfstream Premera BC/VivacityPeter Hayes ~Hannaford Quad/Graphics; QuadMedHealth Alliance Med Plans Quest DiagnosticsHEB State of ColoradoHorizon BCBS NJ Univ of Colorado Health SciencesHumana WellPointIBM WhirlpoolIHP/Battle Creek Yum!

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Our Mission

Our mission is to drive the value of every dollar invested in health Our goal is to identify and link innovators and innovation

that broaden the boundaries of health value

Our work is focused on defining value, creating relevance to shareholders and stakeholders, and improving the health and economic viability of communities.

Jan-Feb 2010 4

Center publishes the first book on levers of VBD; white papers, evidence

Jan-Feb 2010©VBHEALTH.ORG

Also publishes evidence on sectors, innovation, outcomes www.vbhealth.org

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Just released

Jan-Feb 2010 6

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Peer-Reviewed Calls to Action:Outcomes-Based Contracting

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The Value of Health is Our Economic SurvivabilityOur agenda must be: How much health is that dollar delivering? VBD is an ENGAGEMENT TOOL that engages the EMPLOYEE

(consumer) and the EMPLOYER (plan sponsor) and the PROVIDER

VBD focuses on OUTCOMES VBD has remarkably changed and matured

Data Design Delivery DIVIDENDS VBD is driven by data that drives the suite of performance

tuners: LEVERS VBD can be tracked along the Health Value Continuum© VBD is sustainable and applicable at the small-large employer

AND at the community level VBD builds the Health-Wealth-Performance Portfolio©

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What Changed?

Distress x Vision x First Steps > Resistance

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Evolution of the Health Value Continuum© 2007

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September 6, 2009

April-May 2010

Pew Benchmarks States’ Financial Positions v CA

http://www.pewcenteronthestates.org/report_detail.aspx?id=56044 accessed 11.15.09

Changes based on budget gap, unemployment and foreclosures

The Economy Affects Health Behaviors 26% have had problems paying

medical/health bills

6 out of 10 have skipped recommended treatment, exams, etc.

1 out 5 workers is uninsured

Pressure at public level is increased

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Compliance, Adherence and Persistence Is at Risk

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What Changed?HPM defined VALUE andVALUE-BASED DESIGNS accelerated momentum

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Center contracts with Buck consultants to verify our work

Objective: Understand the experience of companies with value-based designs in place for 2 or more years

Over 100 companies responded Represent over 1 million employees Jumbo to small, public/private, non-profit

and governments-as-employers

Levers cover all 3 domains 87% Use levers in prevention and wellness 60% Use levers for chronic care

management 26% Use levers for guidance to

appropriate care delivery

54% use levers for Depression management

NOTE: some numbers may not add up to 100: this could be due to rounding errors or because companies were allowed to choose more than one response

April-May 2010

What We Now Know… No VBD succeeds without a primary focus on prevention

and wellness

All successful adoptions and accelerations of VBD are linked to the level/timing of communications And no one succeeds when only communicating 1 time per year

Acceleration occurs when aligned incentives drive outcomes This includes patient-centered coordinated care This includes use of community-based assets This includes communication no less than quarterly to keep

stickiness of behavior change across all stakeholders

Sustainable and measurable value occurs across silos, into the community (when providers achieve improvement in health and financial outcomes) and into families

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If Value Is Built on Outcomes, then Purchasing Must Be Built on Outcomes for Alignment

Outcomes can be measured by determinants Clinical Financial Operational (Process) Community

Outcomes-Based Contracting must align incentives between or across the signers of the contract Health Plan/Plan Sponsor Manufacturer/Service Organization

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VBD Are Economically Sustainable…

April-May 2010

79% said no changes were made in 2009-2010 due to economic downturn

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…VBD Are Economically Sustainable

April-May 2010

56% said no changes due to the economic downturn were anticipated for the next plan year

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What Could They Have Done Better?Better Employee Communication and Communication with the Physicians/Pharmacists/Clinicians for Aligned Messaging

April-May 2010

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Where are we now?Levers Accelerate Adoption, Integration, Efficiency and Outcomes

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Fundamentals of Value-Based DesignValue-based design is an ENGAGEMENT TOOL

for the CONSUMER AND PLAN SPONSOR AND PROVIDER

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Uses Data to invest in incentives…

…and services that change behaviors

for improved health, quality, performance and financial trend

VBD is focused on OUTCOMES

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Decision Matrix Follows the Health Value Continuum examples of leversSolve for: Waste

ReductionFuture Risk Reduction

Individual Health Competency

Underuse/ Overuse/ Misuse

Compression of Morbidity

Decision Support for Health-Wealth- Performance

Prevention and Wellness

Remove barriers to primary care

Incentive for early risk reduction

Incentive for use of PHR

Chronic Care Management

Remove barriers to chronic care

Incentive for adherence

Incentive for counseling

Care Delivery

Guide to efficient care site

Incentive for care coordination

Disincentive for ER use

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Application Value-Based Design: Modeled Savings with Applied Data

April-May 2010

Target Productivity Savings Levels

$ Productivity Gains

Added Workdays

% Increase in Human Capital Growth FTEs

1% $ 118,469 212 0.06% 0.8

Adherence will drive value through productivity gains, reduced financial trend

Modeled with IBI

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Value-Based Design Is Sustainable When It’s Mapped to Productivity Example: Back Pain

20% loss in productivity in high risk group Waster Reduction Lever:

mandatory fitness/rehab Chronic Care Lever:

EAP/Behavioral health coach Care Delivery Lever: Physical

Therapy

Example: Smoking 9% loss in productivity in high risk

group Waste Reduction Lever:

mandatory cessation classes Chronic Care Lever: reduction in

Tx copays Care Delivery Lever: Weekly

IVR/ phone calls with counselor

April-May 2010

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Data, Design, Delivery, DividendsUpdate on Our Work

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Behavioral Change Has Emerged as the Key to Improving Health Status

Mercer 2009 Recession and Reform Survey

80 percent will increase employee communication/ education aimed at reducing cost or improving health

45 percent will implement programs to improve treatment and medication compliance

29 percent will introduce contribution-based incentives

21 percent will implement consumer-directed health plans

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Alignment: If Value Is Built on Outcomes, then Purchasing Must Be Built on Outcomes

Outcomes can be measured by determinants Health (clinical) Wealth (financial) Performance (operational)

Outcomes-Based Contracting must align incentives between or across the signers of the contract

Jan-Feb 2010 29

©VBHEALTH.ORG

Alignment: If Value Is Built on Outcomes, then Purchasing Must Be Built on Outcomes

Outcomes can be measured by determinants Health (clinical) Wealth (financial) Performance (operational)

Outcomes-Based Contracting must align incentives between or across the signers of the contract

Jan-Feb 2010 30

Innovator DNA

Innovators embrace a mission for change. Make mistakes Take risks Display courage Transform ideas into powerful impact Provide to the general community in order to

change the ecosystem

HBR Vol 87 #12, Dec 2009

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Jack Mahoney MDCyndy Nayerwww.vbhealth.org

[email protected]

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