UDI: At the Intersection of Cost, Quality, and Outcomes...2016/04/04 · Slide 11 CQO Case Study: CLABSI Paradigm for dealing with healthcare acquired infections needs to shift from

Slide 1

UDI: At the Intersection of Cost, Quality, and Outcomes

4/19/2016

Karen Conway, GHXMichael Schiller, AHRMM

Slide 2

Getting to Value Requires Systems Thinking

Slide 3

Medical Product Lifecycle

Design

ManufacturePackage/Label

Market

Sell

Distribute

Source

PurchaseReceiveStoreUse

ID and TrackReal World Evidence

Approve

Pay/Charge/Reimburse

Slide 4

UDI for Manufacturers

• Assign• Label• Publish Data to

Global UDI Database (GUDID)

UDI for Providers (Customers

• Capture UDI• Store UDI in List of

Patient’s Implantable Devices in EHRs

• Parse UDI• Pull Data from GUDID• Share UDI as part of

Common Clinical Data Set

Regulatory Requirements

Slide 5

Compliance with the Customer in Mind

Slide 6

Characterized by comprehension of the parts of something as intimately interconnected and explicable only by reference to the whole• Cost, Quality and Outcomes (CQO) refers to a more holistic view

between cost, quality and outcomes as opposed to viewing each independently.

• “This is not about just being able to identify devices. We (FDA) are talking about a holistic approach to integrating medical device information throughout the entire healthcare system. UDI will be a fundamental piece of everything we do going forward”

U.S FDA Center for Devices and Radiological Health

Holistic

Slide 7

ONC and CMS released their final regulations regarding capture and exchange of the UDI in health IT systems.

The ONC ruling:• Includes the UDI within the Common Clinical Data Set (CCDS), which is a summary of

key information on the patient such as medication allergies or immunizations• Health IT systems must be able to parse the UDI data as well as link to the UDI

database, the GUDID

The CMS ruling:• Providers are expected to include all of the CCDS elements that are available, including

the UDI, when they exchange summary of care documents

Meaningful Use 3

Slide 8

CQO: conceptIn 2013, AHRMM launched the Cost, Quality, and Outcomes Movement, a new way of approaching supply chain.

Under the CQO movement, the supply chain can no longer focus exclusively on price, but rather the combination of product cost, the quality of care delivered, and the reimbursement outcomes to support healthcare’s new value-based models.

Slide 9

CQO: definitionThe CQO Movement looks at the intersection of, and the relationship between• Cost: all costs associated with delivering patient care and supporting the care

environment • Quality: patient-centered care aimed at achieving the best possible clinical outcomes • Outcomes: financial reimbursement driven by outstanding clinician care at the

appropriate cost

It is important that these relationships be considered together rather than in separate silos

Slide 10

CQO: collaborationCQO requires supply chain leaders to expand upon, and build new and different types of relationships across the healthcare spectrum including:• Suppliers & Manufacturers• Physician leadership• Clinicians• C-Suite• Distributors• GPOs• Finance

Slide 11

CQO Case Study: CLABSIParadigm for dealing with healthcare acquired infections needs to shift from treatment to prevention

250,000 central line associated bloodstream infections occur annually -2011 CDC

Increased patient mortality and cost between $25,000 –$550,000 per incident – 2011 Hollenbeak

Improper hub care can lead to CLABSI’s as well as to contaminated blood cultures

To prevent infection in patients with IV access devices, the CDC recommends

disinfecting needleless connectors

Current recommendations do not specify a duration of

hub disinfection except to state that 5 seconds is insufficient and that 15

seconds may be adequate – Kahler, 2007 Menyhay, 2006 CDC

Difficult to monitor compliance to “scrub the hub” for 15 secondsConsider other disinfection practices and/or

products

Slide 12

Estimated Cost vs. Outcome = Quality of Patient CareLocation A

1.5 cases per month$ 2,175 / month$26,100 / year

Location B

1 case per month$ 1,450 / month$17,400 / year

TOTAL = $43,500 / year

COST of 1 CLABSI = $45,814

Slide 13

CLABSI Results

Improved patient quality, $94,000 in savingsFacility Rate = 0.93 Facility Rate = 0.63

• 5 Femoral• 2 PICC• 1 Right IJ• 1 Mediport

2013Central line infections

www.cdc.gov/nhsn(National Healthcare Safety Network)

NHSNBenchmark

2014• 4 Femoral• 1 PICC• 1 Subclavian

Hickman

Central line infections

www.cdc.gov/nhsn(National Healthcare Safety Network)

NHSNBenchmark

http://www.cdc.gov/nhsn

http://www.cdc.gov/nhsn

Slide 14

Cost

OutcomesQualityUDI

Slide 15

-U.S. FDA CDRH April 2013

Slide 16

Supply Chain

Point of Use

Capture Contracting

Value Analysis

Inventory Management RecallsStandardization

and Utilization

ERP/EHR

Post Market Analysis/CER

Value BasedReimbursement

Demand Forecasting

Slide 17

Business Name Item Number Type Item Number

BD Mfg Catalog Number 329461

BD GTIN 00382903294619

Cardinal Health PV Order Number BF329461

Owens & Minor PV Order Number 0722329461

American Medical Depot Vendor Catalog Number 777127217

Government Sci Source Vendor Catalog Number FSC1482679CS

Alliance Joint Venture Vendor Catalog Number 888021932

Thomas Scientific Vendor Catalog Number 8938M25

VWR International Vendor Catalog Number BD329461

Only UDI compliant code

on list

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0 0085412 00000 8

5 0085412 00000 6

Case of 10 Each

2 0085412 00000 4

6 0085412 00000 9

1 EachPack of 1 Each Case of 10 Packs of 1 Each

Each level of packaging requires a unique device identifier

Slide 19

Item Master: the single source of truth“Single Source of Truth (SSOT) refers to the practice of structuring information models and associated schemata such that every data element is stored exactly once.”

-Wikipedia

Write Once, Read Many

Slide 20

Bundled Payments• Bundled payment asks providers to assume financial risk for the cost of services for a

particular treatment or condition, as well as costs associated with preventable complications.

• Different Contracts similar need to measure performance like med surg contracts.

BUNDLED PAYMENTReimbursement to health care providers on the basis of expected costs for clinically-defined episodes.

Epi

sode

Tim

ing

30 days

Diagnostic

2-5 days

Event

90 days

Follow-Up Care

– Home Health– Physicians

– Rehab– Managed Services

Slide 21

Comprehensive Care for Joint Replacement (CJR)

• 2014 figures:

• CMS has implemented the CJR model in 67 geographic areas, defined by metropolitan statistical areas (MSAs) which are counties with a core urban area that has a population of at least 50,000.

• Program begins April 1, 2016

Hip and Knee replacements are the most common inpatient surgery for Medicare beneficiaries

> 400,000 procedures> $7B for hospitalization alone

Slide 22

Clinical variations = CostsR

educ

ed C

osts

Impr

oved

Out

com

es

• Improved quality of care• Improved patient satisfaction• Decreased variability

• Reduce use of costly ‘no-value’ supplies

• Reduce length of stay• Decrease resource consumption

Unchecked, clinical variations can become a major cost for hospitals and healthcare organizations, driving up spend without offering substantial benefits

Source: Vie Healthcare Consulting & Analytics

Slide 23

SurgeonMSDRG 470 Total Knee

Total Knee Volume

Total SpendNot to Exceed Group Average

25 PercentileBest in Class

$8,070STRANG JR, ROBERT T $8,070 1 $8,070 $8,070 $8,070 $8,070WHITMAN, THOMAS L $8,273 89 $736,311 $736,311 $736,311 718,262 STEWART, GREGORY L $8,879 1 $8,879 $8,879 $8,879 8,070 JENKINS, TIMOTHY D $9,167 50 $458,368 $458,368 $458,368 403,518 AIKEN, MARC A $9,244 4 $36,976 $36,976 $36,976 32,281 HOMMEL, GABRIEL J $9,802 13 $127,431 $127,431 $127,431 104,915 TAGERT, BERT E $9,936 63 $625,989 $625,989 $625,989 508,433 TESTERMAN, JOHN R $10,183 27 $274,940 272,608 $268,281 217,900 MINTER, JON E $10,227 105 $1,073,809 1,060,142 $1,043,314 847,388

MILLER, BRUCE M $10,374 121 $1,255,306 1,221,687 $1,202,295 976,514

KREIN, STEVEN W $10,379 18 $186,827 181,739 $178,854 145,266

PARSLEY, BILLY K $10,404 1 $10,404 10,097 $9,936 8,070 FLEENOR, MICHAEL R $10,455 9 $94,099 90,869 $89,427 72,633 JEANSONNE, GREGORY E $10,468 5 $52,340 50,483 $49,682 40,352 MULLINS, DANNY A $10,676 57 $608,549 575,505 $566,371 460,011 FRANCE, JEFFREY J $10,747 33 $354,646 333,187 $327,899 266,322 PARK, JASON C $11,019 93 $1,024,785 938,983 $924,078 750,543 PHILLIPS, JOHN H $11,263 11 $123,888 111,062 $109,300 88,774 RIGGINS, PATRICK J $11,706 10 $117,056 100,966 $99,363 80,704

711 $7,178,674 $6,949,352 $6,870,824 $5,738,026$10,097 $9,774 $9,664 $8,070

Potential Savings =====> $229,321 $307,849 $1,440,648

SURGEON 1SURGEON 2SURGEON 3SURGEON 4SURGEON 5SURGEON 6SURGEON 7SURGEON 8SURGEON 9SURGEON 10SURGEON 11SURGEON 12SURGEON 13SURGEON 14SURGEON 15SURGEON 16SURGEON 17SURGEON 18SURGEON 19

Slide 24

Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL

470 Major joint replacement or reattachment of lower extremity w/o MCC $3,860

81.51 TOTAL HIP REPLACEMENT 13 $6,349 $5,907 $8,663 $4,405 3.2 0.00 0.00 5.92

81.52 PARTIAL HIP REPLACEMENT 2 $4,399 $3,055 $6,299 $5,722 3.3 0.00 0.00 31.94

81.54 TOTAL KNEE REPLACEMENT 27 $5,131 $6,626 $7,783 $6,823 3.0 0.00 0.00 0.00

Physician Attending Physician of Record SC Goa1 Std Deviation from Lowest CostTotal SC Actual MSCMTotal Cost HPMMargin Total or Exp Payment (greater) - SC + Direct Variable

GOAL MET =

GOAL UNMET =

Risk-Adjusted Mortality

Index (RAMI)

LEGEND

Total Volume

Supply Cost per patient

Total Cost per patient

Margin per patient

Risk-Adjusted Complications

Index (RACI)

Risk-Adjusted Readmission

Index (RARI)

Clinically Adjusted LOS Per

Case

MS-DRG MSDRG Name

Green

Red

Green

Red

Mea

sure

Valu

eGOAL M

easu

re V

alue

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL Mea

sure

Valu

e

GOAL

470 Major joint replacement or reattachment of lower extremity w/o MCC $3,860

81.51 TOTAL HIP REPLACEMENT 42 $5,257 $6,912 3.1 0.00 0.67 0.00

81.52 PARTIAL HIP REPLACEMENT 8 $2,124 $4,189 5.2 0.00 0.00 0.00

81.54 TOTAL KNEE REPLACEMENT 89 $5,397 $7,412 3.1 0.00 0.30 0.42

Physician Attending Physician of Record SC Goa1 Std Deviation from Lowest CostTotal SC Actual MSCMTotal Cost HPMMargin Total or Exp Payment (greater) - SC + Direct Variable

GOAL MET =

GOAL UNMET =

Risk-Adjusted Mortality

Index (RAMI)

LEGEND

Total Volume

Supply Cost per patient

Total Cost per patient

Margin per patient

Risk-Adjusted Complications

Index (RACI)

Risk-Adjusted Readmission

Index (RARI)

Clinically Adjusted LOS Per

Case

MS-DRG MSDRG Name

Green

Red

Green

Red

Slide 25

UDI Demonstration Project - Information Flow

Slide 26

UDI Research Database (UDIR) – Data Model

• Research Data-Mart designed to integrate and rationalize multiple subject-

areas

Slide 27

Cost and ValueTotal Hip and Total Knee Revisions:• 2010 aggregate costs close to $18B• TKA revisions are expected to double by 2015• THA revisions are expected to double by 2026

Clinical and Cost Implications:• Increased procedure time• Need to replace more components• Greater surgical complexity• Higher health care costs• Increased blood and bone loss• Longer recovery times• 41 hours, annually, of surgeon and staff time

Source: The Journal of Arthroplasty, Revision Total Hip and Knee Arthroplasty Implant Identification: Implications for Use of Unique Device Identification 2012 AAHKS Member Survey Results, 2014

Slide 28

Cost and ValueAnnual estimated global costs:• Recall handling costs of $2B - $4B

– Typical medical device recall can take up to about 2 days of effort within a hospital setting• Inventory

– Inventory estimates $516B– Financing costs estimated at $33B– Inventory management costs estimated at $53B - $65B

• Obsolescence costs of $33B• Data cleansing and order process error resolution estimated at $2B - $5B

Annual estimated global value:• Recall handling costs savings estimated at $1B• Inventory management cost reduction estimated at $6B - $8B• Reduced product obsolescence $19B - $27B• Efficient transactions accuracy savings estimated at $1 - $2B

Source: McKinsey & Co., Strength in unity: The promise of global standards in healthcare, October 2012

Slide 29

All great changes are preceded by chaos.— DEEPAK CHOPRA

UDI Adoption

29

Slide 30

Mike [email protected] 422-3839

mailto:[email protected]

UDI: At the Intersection of Cost, Quality, and Outcomes...2016/04/04 · Slide 11 CQO Case Study: CLABSI Paradigm for dealing with healthcare acquired infections needs to shift from

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