The ABC s of ACO s Cindy Dullea RN MBA

Agenda § Accountable Care Organizations § What, Why, Where, How? § Care Management § Want Role Will Access Management have? § Questions Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

What is an Accountable Care Organization? § An ACO is a network of doctors and hospitals that shares responsibility for providing care to patients. § Under the new law, ACOs would agree to manage all of the health care needs of a minimum of 5, 000 Medicare beneficiaries for at least three years. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

When will ACOs begin operating? § The ACO initiative is scheduled to launch in January 2012, but the race to form ACOs has already begun. § Hospitals, physician practices and insurers across the country, from New Hampshire to Arizona, are announcing their plans to form ACOs § Not only for Medicare beneficiaries but for patients with private insurance as well. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Why did Congress include ACOs in the law? § As lawmakers search for ways to reduce the national deficit, Medicare is a prime target. With baby boomers entering retirement age, the costs of the program for elderly and disabled Americans are expected to soar. § ACOs would make providers jointly accountable for the health of their patients, giving them strong incentives to cooperate and save money by avoiding unnecessary tests and procedures. § For ACOs to work they’d have to seamlessly share information. Those that save money while also meeting quality targets would keep a portion of the savings. § The Congressional Budget Office estimates that ACOs could save Medicare at least $4. 9 billion through 2019. § That’s less than one percent of Medicare spending during that period, but if the program is successful it might be expanded by Health and Human Services Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

How would ACOs be paid? In Medicare’s traditional fee-for-service payment system, doctors and hospitals generally are paid more when they give patients more tests and do more procedures. That drives up costs. § § § ACOs wouldn’t do away with fee for service but would create savings incentives by offering bonuses when providers keep costs down and meet specific quality benchmarks, focusing on prevention and carefully managing patients with chronic diseases. § In other words, providers would get paid more for keeping their patients healthy and out of the hospital. § We might see bundled payments (global) for specific “episodes of care. ” If an ACO is not able to save money, it would be stuck with the costs of investments made to improve care, such as adding new nurse care managers, but would still get to keep the standard Medicare fees. The law also gives regulators the ability to devise other payment methods, which would likely ask ACOs to bear more risk. § For example, an ACO could be paid a flat fee for each patient it cares for. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

How will an ACO be different for patients? § Patients may not even know that they are part of an ACO. § Although doctors will want to refer patients to hospitals and specialists within the ACO network, patients will still be free to see doctors of their choice outside the network. § ACOs also will be under pressure to provide high quality care because if they don’t meet standards, they won’t receive savings bonuses – and could lose their contracts. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Who's in charge —hospitals, doctors or insurers? Hospitals, doctors and insurers are all vying to run ACOs. This question was left purposely vague in the law in order to be flexible. § Some regions of the country, including parts of California, already have large multi-specialty physician groups that may become an ACO on their own, likely by networking with neighboring hospitals. This may mean a dusting off of the existing health care structures they had in place" which we knew as capitation or PHO’s § In other regions, large hospital systems are scrambling to buy up physician practices with the goal of becoming ACOs that directly employ the majority of their providers. § Because hospitals usually have access to capital, they may have an easier time than doctors in financing the initial investment required by an ACO. § Some of the largest health insurers in the country, including Humana, United Healthcare and Cigna, already have announced plans to form their own ACOs. § Insurers say they can play an important role in ACOs because they track and collect data on patients, which is critical for coordinating care and reporting on the results. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Lots of Different Approaches Proprietary and Confidential © 2008 – 2011 SCI Solutions. All

If patients don't like HMOs, why consider an ACO? § ACOs may sound a lot like health maintenance organizations. Some consider an ACOs to be an HMOs (or a PHO) in drag. § But there are some critical differences – notably, an ACO patient is not required to stay in the network. § ACOs aim to replicate "the performance of an HMO" in holding down the cost of care while avoiding "the structural features that give the HMO control over [patient] referral patterns, " which limited patient options and created a consumer backlash in the 1990 s. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

What can go wrong? § History has shown that the health industry tends to operate with "kind of a herd behavior, " rushing to implement an idea "without working through the detailed business questions of how they'll work. § ACOs could become three-letter health acronym of the year, if not the decade just like PHOs were in the 90 s. § Many health care economists fear that the race to form ACOs could have a significant downside: hospital mergers and provider consolidation. § As hospitals position themselves to become integrated systems, many are joining forces and purchasing physician practices, leaving fewer independent hospitals and doctors. § Greater market share gives these health systems more leverage in negotiations with insurers, which can drive up health costs. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Are there any possible legal concerns? § Doctors, hospitals and others in the health care industry have raised concerns that ACOs could run afoul of antitrust and anti-fraud laws, which try to limit market power that drives up prices and stifles competition. § One concern is that ACOs, particularly those in rural markets, could grow so large that they would employ the majority of providers in a region. In other words – they are the only game in town. § To help providers avoid legal problems, the Federal Trade Commission says it is trying to clarify antitrust guidelines for ACOs, and the U. S. Justice Department's antitrust division has offered to provide an expedited antitrust review process for ACOs. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Understanding the Four – C’s § § Complexity Coordinate Collective Community – Based Care

Complexity § § § Health care systems growing More IT … more data…more data sources Aging population with chronic diseases Genomics and phenomics in relation to clinical care Greater number of healthcare providers involved in care management Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Coordinate § § Communication Information sharing Care team workflow IT infrastructure supporting connectivity Proprietary

Collective § Reimbursement tied to care delivery § Focused on wellness and supports the

Community Based Care § § Medical Device and mobile technology Shift from volume driven to value driven Health Management Tools Primary Care is integral – this could be an issue given there are not enough. Also the law says the PCP can belong to only one ACO, but specialists can belong to many § Increase in Medical Home Programs may occur § Strong Case Management needed. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Payment for Care § ACOs will need to comply with a kitchen sink of 65 clinical measures that are meant to produce efficiencies § reducing infections or ensuring that patients take their medications after hospital discharge. § If care at an ACO costs less than Medicare predicts it will cost under the status quo, then the ACO will receive a share of the savings as a bonus payment. § The rule also includes financial penalties if an ACO misses its targets. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

The Role of Patient Access § Patient Access will play a pivotal role in the support of care coordination. § Patient Access must develop new skills and creative approaches for providing clinical services while managing front-end revenue cycle processes § Most importantly, the front-door patient experience. § But First – know your customer! Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Veteran’s § Born prior to 1945 (Age 63+) § Core Values § Advanced education a dream § Silent and Traditional § Respect Authority Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Communication With The Veteran § § May be Technology Phobic – or NOT! May write a memo before calling – very paper oriented Not afraid of challenges Do better in smaller one on one conversations Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Baby Boomers § Born between 1946 and 1964 (Age 45 to 63) § Core Values § Strong commitments § First Baby Boomer reached Medicare eligible this year § A record 2. 8 million will qualify in 2011, rising to 4. 2 million a year by 2030 § Communication diverse Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Communication With The Baby Boomer § Unpredictable § You’ll need to relate to their generation § They look for products and services that speak to deeper values. They expect customer service § Communication aimed at their self image – how they view their health. Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

How can Access Management play in an ACO environment? § Ease of Obtaining Care § Build your Physician Community § Make the process of orders for services easy § § § § Orders to the hospitals in the ACO Orders from PCP to Specialty Care Orders from Case Management for Discharge Planning Medical Necessity ED Deployment – to gatekeep care in the network EMR Integration to your owned/community MD’s Order and Medication reconciliation Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

How can Access Management play in an ACO environment? § Enterprise Wide scheduling § Intelligent scheduling/multi location functionality § Tight integration to Registration § Worklist and Front End Revenue functionality (authorizations, medical necessity) § Inpatient Transfer Center § Reminders (support of predictive and preventative care) § Order Compliance Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

How can Access Management play in an ACO environment? § Self-Service Modules § Patient- Facing Technologies § Portals for online appointment scheduling § Reduction of administrative costs through self service Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Bottom Line “Self-service is a clear and present trend in many other industries and will be embraced more enthusiastically by the Healthcare Delivery Organizations during 2011. As time goes on, patients will view patient self-service as a market differentiator. There is a real need to improve the patient experience, to better coordinate care, to become more operationally efficient and to improve the quality of patient information. As part of the IT infrastructure underlying the Real Time Healthcare System, patient selfservice (kiosks) offer a way of contributing to these goals. ” Source: Gartner Group – “Three Good Reasons for Deploying Patient Self-Service Kiosks” © 2011 Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Healthcare Needs Self-Service Every Other Major Industry Has Adopted Self-Service Options ATM / Cash Machines Online Travel Websites Pay-at-the-Pump Self Check-out Registers Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

Lets Improve Our Service § Even better, let’s have all major transactions be Self Service: § § Physician offices self order and self schedule Patient self-register and self schedule Improve customer satisfaction Baby Boomers will expect this! Portals and Kiosks Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved.

The Menu of Access Options is the Key Menu of Access Options for Referring Physician Offices If your office is connected to the Internet: Pick one or more; change your mind anytime Send e-Order via EMR/Web (hospital will call patient to schedule) Self-schedule appointment (with e-Order sent in same flow) If you prefer the personal touch: Call centralized scheduling (you can fax or send the order later) If you really want simple, low-tech: Fax your order to hospital (hospital will call patient to schedule) Regardless of how you refer patients to the hospital, you or your staff can check the status of the appt/order online at any time, from anywhere you can get to the Internet Proprietary and Confidential © 2008 – 2011 SCI Solutions. All rights reserved. Menu of Access Options for Patients/Consumers Scheduling Options Self-schedule appointment Call centralized scheduling Receive call from hospital (based on hospital getting order) Pre-Registration (to save time when you arrive) Pre-Register online Receive call from hospital (can be scheduled for convenience) Arrival Options Quick Check-In with Staff Check-In at Kiosk