Mike Dinneen, MD, PhD Director, Office of Strategy Managment Office of the Assistant Secretary of Defense for Health Affairs Why MEPRS Matters More Than.

Mike Dinneen, MD, PhDDirector, Office of Strategy ManagmentOffice of the Assistant Secretary of Defense for Health Affairs

Why MEPRS Matters More Than Ever

Transformational Change

“Most ailing organizations have developed a functional blindness to their own defects. They are not suffering because they cannot resolve their problems, but because they cannot see their problems.”

John Gardner“The significant problems we face cannot be solved at the

same level of thinking we were at when we created them.”

Albert Einstein“There is nothing so powerful as an idea whose time has

come.”Victor Hugo

Objectives

• Understand Department of Defense Strategic Direction and how expense reporting fits in.

• Understand the MHS Strategic Plan and how MEPRS fits in.

• Understand the critical importance of MEPRS Time allocation in achieving performance based management.

• Understand how MEPRS accounting will be modified to enable collection of cost and workload data in a manner that resembles best civilian practices.

Patient Care, Sustain Skillsand Training

Promote & Protect Health of the Force and Communities

Deploy toSupport the CombatantCommanders

to and

MHS Mission: To enhance DoD and our Nation’s security by providing health support for the full range of military operations and sustaining the health of all those entrusted to our care.

Manage and Deliver Beneficiary Care

Medically Ready and Protected Force

Deployable Medical Capability

Support Homeland DefenseProvide Humanitarian Aid

MHS Vision: A world-class health system that supports the military mission by fostering, protecting, sustaining and restoring health.

Create Value for our External Stakeholders – What are the key outcomes?

• A fit, healthy and protected force

• Reduced death, injuries and diseases during and after military operations

• Satisfied beneficiaries

• Creation of healthy communities

• **Effective management of healthcare costs

MHS MissionMHS MissionTo enhance DoD and our Nation’s security by providing health support for the full range of military operations and sustaining the health of all

those entrusted to our care.Stakeholder Perspective

Customer Perspective

Internal Process Perspective

Learning & Growth Perspective

Medically Ready and Protected Force

F1 Manage health care

costs

Mission Centered Care

IP9 Health and environmental

monitoring

S2 Warrior Care – Before, during

and after operations

S3 Beneficiary satisfaction

R1 Transparent and reliably available resources

Patient Centered Care

C2 Convenience and accessibility

C1 Health Partnerships

S4 Healthy communitie

s

DoD Beneficiaries Commanders and Service Members

Resource Perspective

C3 Care anytime, anywhere

IP10 Individual medical

readiness

C4 Readiness partnership

S1 Force medical readiness and community protection

“Total Customer Solution” “Product Leadership”

Manage and Deliver the Health Benefit

IP1 Evidence based

medicine

IP3 Patient

centered, effective processes

IP2 Partnerships

with beneficiaries

Deployable Medical Capability and Homeland Defense for Communities

IP8 New product and service development

IP6 Globally accessible health and performance information

IP5 Joint processes

deliver care anytime, anywhere

L5 Total force

development

R2 Infrastructure management

Human CapitalOrganization & Culture

Financial Perspective

IP7 Humanitarian missions and homeland defense

L6 Coordinated Biomedical

R&D

L7 IM/IT optimall

y leverage

d

Science and Technology

Learning & Growth Perspective

L4 Authority and accountability are aligned

L3 Culture of jointness and interagency cooperation

L2 Performance based management

L1 Customer focus

Organization & Culture

Performance Based Organization

• A high performance organization is:– Employer of choice – (staff)– Provider of choice – (customers)– Best value for investors (stakeholders)

• What is required to create a high performance organization:– A strategic plan that describes how value is created for each of

the three groups above– Business plans for each business unit that link with the strategic

plan– Well understood objective measures of success– A workforce provided with incentives and tools to innovate

The Burning Platform – What is the Problem that We Are trying to Solve

• We do not know for sure that our medical professional workforce has the experience to excel in operational settings.

• We appear to be less efficient that civilian counterparts in part because we are not “valuing” non-clinical but, mission essential activites.

• We can’t accurately compare performance across MTFs because we count differently

• Our data systems have not been designed to specifically support our business model

What is the Cause of the Problem

• Current policy does not specify use of a specific business model

• Current organizational structure is widely variable • Training does not adequately address performance

based management in healthcare• Our systems were not designed to monitor costs, outputs

and outcomes in a manner consistent with commercial practices

• Leadership accountability for system performance is not been aligned with incentives and measures.

• We are not developing business managers and group practice managers as a strategic job family.

What is the Solution?

• Group Practice and Clinical Work Centers – managed separately – supports optimal performance while adapting

to some variation in organizational structure– Supports business plans and financing in

Multi-Service Markets to be Market based– Promotes monitoring and management of

clinical currency for all medical professionals

The Civilian Model of Institutional vs. Professional Charges – a key enabler

• Institutional Charges– Pays for hospital and some clinic expenses– Linked to DRG/RWP for IP care– Pays for ER and APV facility expenses

• Professional Charges– Pays for group practice expenses– Linked to RVUs earned by providers in all

clinical settings (IP, OP and APV)

How will this affect you?

• Standard Application of MEPRS across all Services

• Standard triservice business processes for the collection of labor expenses

• Full transparency of performance data, including MEPRS labor cost allocation

• You must identify your customers and answer the so-what question.

Keys to Success

• Simplify data capture for individuals– Lump, don’t split work centers– Standard naming of work centers– Standard time allocation rules– Simplified data entry– Show people their data– Align accountability with authority – the

golden rule

Monthly Group Practice Profit and Loss Statement (Professional)  

Total "Revenue" 3000RVU*$40/RVU = $120,000

Support Staff Salary Expense (MEPRS ) ($45,000)

Supply Expense ($5,000)

Travel Expense ($4,000)

Overhead Expense (E Stepdown) ($20,000)

Net Earnings $46,000

Provider Salaries ($56,000)

Profit (or loss) ($10,000)

Monthly Hospital Ward Profit and Loss (Institutional)  

Total "Revenue" 150RVU*$6000/RWP = $900,000

Support Staff Salary Expense (MEPRS ) ($325,000)

Supply Expense ($145,000)

Travel Expense ($10,000)

Overhead Expense (E Stepdown) ($300,000)

Profit (or loss) $120,000

Hypothetical Example of Group Practice and Clinical Work Center Monthly Financial Reports

Note: Q: Where does the group practice “revenue” come from?A: All of the work done by the providers in the group practice regardless of where it is done!

Note: Q: Where does the ward “revenue” come from?A: All of the work done by the ward only, (not the work that the physicians receive RVU value for).

What do you think?

Synopsis

• I will show how success in strategic transformation in the Department of Defense and the Military Health System depends on accurate and reliable expense data.

• I will then explain how minor changes and improvements in the methods for capturing and displaying MEPRS data will allow us to compare performance across MTFs and benchmark with civilian healthcare facilities. This section of the brief will include an overview of the concept of professional and institutional charges.

• Finally, I will try to show how success in simplifying and standardizing MEPRS 3rd and 4th level names and definitions will make the transition to DMHRSi much easier.

Strategic Goal: Enhance deployable medical capability, force medical readiness and homeland defense including humanitarian missions

Tactical Focus: • Partner with VA to improve case management and share medical

information• Improve care for traumatic brain injury (TBI) and post traumatic

stress disorder (PTSD) • Conduct TBI and PTSD research within the MHS and in partnerships• Improve the medical surveillance program• Codify and expand humanitarian mission support• Improve the Medical Logistics System

Strategic Goal: Sustain the Military health benefit through top quality patient-centered care and long-term patient partnerships with a focus on prevention

Tactical Focus:

- Improve provider-patient communication and partnering – ensure that our patients are in control of their health

- Expand tobacco, alcohol and weight management programs

- Implement focused disease management in MTFs and the purchased care system

- Target CPI projects to improve access to care, referral management and pharmacy management

Strategic Goal: Provide globally accessible, real time, health information that enables medical surveillance and evidence based healthcare

Tactical Focus:• Implement AHLTA and TMIP and ensure seamless patient tracking• Develop joint DoD and VA IP electronic health record • Improve the speed and reliability of AHLTA• Develop real time prevention, disease management and medical

surveillance capabilities within AHLTA• Deploy the personal health record

Strategic Goal: Provide incentives to achieve quality in everything we do

Tactical Focus

• Implement Continuous Process Improvement throughout the MHS

• Make clinical quality data transparent and widely available

• Focus MTF business plans on the entire MHS mission, not just production of health services

• Develop alternative RVU scale to incentivize prevention and readiness activities

• Implement joint governance to improve mission effectiveness

• Implement true market management especially in large multi-Service markets

Strategic Goal: Develop our most valuable asset—our people

Tactical Focus

• Improve joint leadership training

• Develop common curricula and a tri-Service educational campus

• Implement coordinated programs to improve recruiting and retention

• Fully implement the Defense Medical Human Resource System (DMHRSi)

Strategic Goal: Build and sustain the best hospitals and clinics; nurture a caring environment

Tactical Focus

Implement BRAC

Use evidence-based design to create healing environments

Remove barriers to effective management of facilities