GHG Forum “Innovate or Disintegrate” April 19th, 2016 1-1:55 PM © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved Urgency in the Market With the magnitude of financial incentives linked to risk- and quality-based payments, health plans and providers that do not continually track and monitor performance will be financially disadvantaged compared to their peers 2 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Urgency in the Market – Risk Adjustment Risk adjustment transfer payments can generate a significant impact on a health plan’s performance: 3 • The expansion of insurance coverage to higher-risk demographics through exchanges and Medicaid has created the potential for adverse selection by way of health plans targeting specific categories of enrollees • In an attempt to avoid risk selection, ACA established a transfer payment mechanism to ensure that a health plan’s premiums are commensurate with the underlying risk of its member population; as a result, plans servicing higher-risk populations will receive payments from those servicing lower-risk populations • The transfer payment methodology results in transfers between health plans on a zero-sum basis; plans that do not accurately collect and report member data are effectively at risk of “paying” their competitors © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. The Wide Disparity in ACA Transfer Payments 2015 Amount Received Plan $262M $237M $108M 2015 Amount Transferred Plan ($335M) ($190M) ($123M) 4 . © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Urgency in the Market – Quality Bonuses The magnitude of quality payments has generated increased focus: 5 • Quality initiatives have evolved from providing performance transparency to an incentive-based program that rewards health plans that deliver high-quality care • CMS quality programs, notably 5-Star, have had an enormous impact on both the quality of care and the bottom line of managed care plans, with 2014 Star Ratings bonuses expected to exceed $2 billion for the large, public MCOs • Payor/Provider collaboration and the emergence of ACOs create new challenges for compliance and the next generation of HEDIS® and quality reporting © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. The Wide Disparity in 5-Star Bonuses Plan >4 Star Enrollment Bonus 595,987 $352M 170,383 $124M 191,388 $107M 1,369,045 $819M 733,757 $528M 76,839 $47M 58,065 $41M Total 6 $2,018M . © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Urgency in the Market With the magnitude of financial incentives linked to risk- and quality-based payments, health plans that do not continually track and monitor plan performance will be financially disadvantaged compared to their peers Risk Adjustment – Transfer Payments Example 2015 Amount Received Plan Risk adjustment transfer payments can lead to significant impact on a health plan’s performance $262M The expansion of insurance coverage to higher-risk demographics through Exchanges and Medicaid has created the potential for adverse selection by way of health plans targeting specific categories of enrollees $237M $108M In an attempt to avoid risk selection, ACA established a transfer payment mechanism to ensure that a health plan’s premiums are commensurate with the underlying risk of its member population; as a result, plans servicing higher-risk populations will receive payments from those servicing lower-risk populations 2015 Amount Transferred Plan ($335M) ($190M) The transfer payment methodology results in transfers between health plans on a zero-sum basis; plans that do not accurately collect and report member data are effectively at risk of “paying” their competitors ($123M) Quality Initiatives – Medicare Star Ratings Example The magnitude of quality payments has been an increasing focus area for health plans Quality initiatives have evolved from providing performance transparency to an incentive-based program that rewards health plans for delivering high-quality care CMS quality programs, notably 5-Star, have had an enormous impact on both the quality of care and the bottom line of managed care plans, with 2014 Star Ratings bonuses expected to exceed $2 billion for the large, public MCOs 7 Payor/Provider collaboration and emergence of ACOs create new challenges for compliance and the next generation of HEDIS® and quality reporting . Plan Total >4 Star Enrollment Bonus 595,987 $352M 170,383 $124M 191,388 $107M 1,369,045 $819M 733,757 $528M 76,839 $47M 58,065 $41M $2,018M © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Infrastructure can’t support the Shift Market dynamics have created an immediate need for innovative revenue optimization and member surveillance solutions that can help address the complex, multi-faceted, and evolving needs of the payor landscape Current Technology Infrastructure is Woefully Inadequate Payment drivers for risk- or quality-based payment models are fundamentally different than the fee-for-service paradigm, rendering legacy systems and workflows inadequately prepared to help health plans thrive Existing infrastructure lacks the transparency and reporting capabilities that provide real-time visibility and allow health plans to better manage care and ensure accurate risk- and quality-based reimbursement An increasingly complex regulatory environment, coupled with the need to collect data across the care continuum, requires workflow automation and auditing solutions that allow for timely submissions and regulatory compliance Problems 8 . © 2016 Pulse8 Inc. 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The Transformation of Managed Care The Business of Managing Care is Undergoing a Fundamental Transformation Expansion of government-funded healthcare and the shift to valuebased reimbursement are driving an operational and strategic shift in the way health plans manage their member populations: Historically, plans have been primarily focused on managing costs through utilization and medical management activities to enhance margins Today, the expansion of risk-adjusted reimbursement and quality initiatives across Medicare Advantage, Managed Medicaid, and Commercial markets has created additional demands to manage revenue Revenue Management MACRA: Value-Based Care Risk Adjustment: ACA STAR: Medicare Risk Adjustment: Medicare and Medicaid HEDIS® / Pay for Performance Premium Margin Cost Utilization Management As the industry continues its shift to value-based payment models, plans are faced with the dual requirement to manage revenue and costs in an integrated manner while ensuring regulatory compliance Case Management Disease Management This transition requires an ability to aggregate and monitor membercentric data to identify opportunities for intervention, close gaps in care, and reduce cost through care optimization Cost Management Medication Therapy Management Utilization Reporting In order to compete in today’s environment, health plans and other risk-bearing entities must continually monitor and stratify member populations to identify cost-effective intervention opportunities that properly manage revenue while minimizing waste 9 . © 2016 Pulse8 Inc. 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MACRA – Redefining Payment Track One: Merit-based Incentive Payment System (MIPS) • • • • This is the default track; participants must qualify for and opt into the APM track Participants include physicians and mid-levels, but not hospitals This is a budget-neutral model: losers will pay the winners Payment adjustments (positive and negative) increase from a maximum of 4% in 2019 to a maximum of 9% from 2020 forward • Exceptional performers are eligible for bonus payments • The MIPS score will aggregate quality, resource use/cost, clinical practice improvement, and meaningful use measures => This track decreases the control that participants have over their final reimbursement Track Two: Alternative Payment Models (APMs) • • • • To participate, a threshold percentage of reimbursement must be placed at risk The risk must be more than a nominal financial risk CMS will determine on a yearly basis which programs qualify as APMs Eligible Patient-Centered Medical Home (PCMH) models will be considered APMs and do not require financial risk • Qualifying providers participating in special “eligible” APM tracks will receive a yearly 5% bonus => This track increases the control that participants have over their final reimbursement 10 © 2016 Pulse8 Inc. 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Infrastructure can’t support the Shift Market dynamics have created an immediate need for innovative revenue optimization and member surveillance solutions that can help address the complex, multi-faceted, and evolving needs of the payor landscape Current Technology Infrastructure is Woefully Inadequate Problems Requirements Payment drivers for risk- or quality-based payment models are fundamentally different than the fee-for-service paradigm, rendering legacy systems and workflows inadequately prepared to help health plans thrive Existing infrastructure lacks the transparency and reporting capabilities that provide real-time visibility and allow health plans to better manage care and ensure accurate risk- and quality-based reimbursement An increasing complex regulatory environment, coupled with the need to collect data across the care continuum, requires workflow automation and auditing solutions that allow for timely submissions and regulatory compliance Proactive identification of care gaps Targeted, timely interventions to help reduce avoidable costs Maximized revenue through sophisticated risk adjustment protocols Minimization of administration costs and wasteful services Solution Specifications Designed to Address Today’s Market Needs 11 Advanced Risk Adjustment and Quality Analytics to Optimize Revenue and Reduce Administrative Spend Scalable Data Management to Aggregate Member-Centric Data across Multiple, Disparate Sources . Provider and Member Engagement to Identify and Close Care and Data Gaps Integrated, Cross-functional Processes to Enable Real-time Reporting and Ensure Regulatory Compliance © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Success Requires Innovation © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved Success Requires Innovation Alignment Across Company Risk Adjustment Initiatives need to be aligned with: • Quality, Case Management • Claim Experts, IT (RAPS vs EDPS) • Provider Contracting / Providers The Strategy at Pulse8 • Financial & Quality Analytics • Pragmatic, ROI-driven Approach • Innovative Gap Closure Strategies 13 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Coordinating Risk Adjustment and Quality Gap Closure Health Plans need to employ a data-driven triad of gap identification, strategic intervention, and dynamic recalibration: • Integrate efforts to close Quality Gaps with those aimed at Documentation & Coding • Assign confidence levels to the likelihood of closing each gap at the individual provider- and member-level • Assign priority scores to the revenue impact of addressing each quality metric • Assign grades for both clinical performance and coding efficacy to providers and medical groups • Utilize Dynamic Intervention Planning to tailor the intensity, timing, and type of intervention in accordance with the characteristics of each particular opportunity • Deploy an integrated analytic solution, such as Qualit8™, as the “Command Center” from which to orchestrate your Quality Management endeavors 14 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Integrating Risk Adjustment and Quality Teams Aligning your Resources and Goals is Key: • Identify groups in your organization that work in Silos • Begin collaborating • Identify shared opportunities and prioritize your focus • Engage providers/members and internal clinical teams • Evaluate performance using data, analytics, and reporting 15 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. RAPS vs. EDPS RAPS EDPS • Understand each of these buckets and the patterns that exist within • Understand the financial impact at the member level • You should have already started working on a plan to mitigate some of the financial impact 16 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. RAPS vs. EDPS Get the right people at the table: • Claim Experts • Case Management • IT / Developers • Quality • Actuarial => Key players from across the company need have a basic understanding of Risk Adjustment and the potential financial impact 17 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. EMR Integration and Electronic Chart Transfers Pulse8 is working with leading Electronic Medical Records (EMR) vendors to: • Leverage their expansive data sets; • Reduce the number of manual chart reviews (Retrospective Risk Adjustment); and • Facilitate Payor/Provider Collaboration through the bi-directional exchange of data: o Extracting patient/member data from the Provider’s EMR and o Returning Gaps in Documentation, Coding, and/or Quality to the EMR Just as our finely-tuned Risk Adjustment Algorithms produce the most efficient Intervention Strategy, Pulse8 is always striving to incorporate additional data sets and adopt innovative Data Acquisition Methodologies 18 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. EMR Integration: Integr8 Generates Value EMR Integration will create value in multiple ways: • • • • • Close HCC Gaps that otherwise would remain open –> incremental revenue Less costly and more efficient than other gap closure interventions –> administrative savings Validate that Medical Record documentation exists –> mitigate RADV audit risk Address Quality Gaps at the Point of Care to improve Star Ratings –> secure Quality bonuses Supports treatment of conditions by network providers –> align with CMS initiative Critical Success Factors: • • • • • Strong data analytics – providing gaps that providers would not otherwise address Data presented as part of the provider workflow to address gaps at the Point of Care Provider engagement to act upon presented gaps Timely feedback after the encounter to ensure gaps have been addressed and closed Real-time confirmation (or nearly real-time) Pulse8 is currently working with the largest EMR Vendors: • • • 19 Allscripts GE Centricity EPIC © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Analytic Insight © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved Financial Projections 21 ©2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Pragmatic, ROI-driven Approach © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved Responsive, Integrated Approach Spanning traditional to unusual sources and types of incoming data Providers Care Mgt Systems Disease Registries Benefits HCPC Rx EMR APIs Enrollment DME, Supplies Lifestyle, Attitudes Claims Lab Results Semi-structured Data Authoritative Sources Disease Groupers: HCCs, CDPS, CRGs etc. Quality Metric Definitions: HEDIS, 5Star, QRS, etc. Standards of Care Confirm Conditions, Close Gaps Identify Opportunities Nomenclatures Rank Opportunities Chart Review Results Proprietary Mining, Modeling, Scoring Vendors Status Updates Assign Intervention Type Update Intervention Status Activate Interventions Chase Listings Update YTD Closures, ROI Update Dashboards 23 Update Output Files ©2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Distinctive Aspects of This Approach Integrated framework has many advantages over standalone solutions • Focus: All care/condition “gaps” in one place for comprehensive view by member, provider • Completeness: Relevant data from broad array of sources in one place at member level • Consistency: Within/across data sources, for more accurate findings, single source of truth • Precision: Comprehensive view highlights right members/providers for all gaps • Effectiveness: Timely interventions with focused credible data and compelling visuals that foster action • Efficiency: Many/most “potential” risk-adjustable conditions also correspond to quality of care metrics • Empowerment: Client tailors interventions to their strategies, risk tolerance, budget driven by our ranking analytics Find potential medical conditions sooner and more precisely • Sooner is far, far better: earlier detection often means better prognosis, more time to rectify gaps, to prove compliance • With newer federal programs – ACA Commercial, MA, Managed Medicaid – confirming potential diagnoses – that is, “risk adjustment” -- yields increased revenue • Multivariate models assess “confidence” of the condition, hence expected value, to target interventions precisely Track record of effectiveness • Recommended thousands fewer interventions that yielded higher total financial return, hence far higher ROI, than other vendors who analyzed the same data • Independent “referee”: We don’t do interventions ourselves, thus we lack the perverse incentive to do more of them in order to boost our revenues at the expense of client’s budget and ROI 24 ©2016 Pulse8 Inc. 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Innovative Gap Closure Strategies © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved Innovative Gap Closure Strategies • EMR Integration: Bi-directional integration of Analytics and Gap Closure Efforts by embedding analytics into the provider’s workflow at the Point of Care and extracting CCD/medical record information from the EMR, thereby improving gap closure rates and reducing the number of costly interventions. • Dynamic Intervention Planning: Deploying the right intervention with the right providers for the right patient at the right time. • Coding Technology with advanced features, such as Optical Character Recognition, Computer-aided Coding, and an Intuitive Interface with error-proofing. • Capturing “off-the-data-grid” Diagnoses: Pulse8 has designed analytics that address blind spots, especially in LIS populations, in order to identify the outliers to target. • Telehealth: Leveraging the increased acceptance of remote clinical visits to speed up the member’s access to care, along with the payor’s access to diagnostic information. 26 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. EMR Integration: Integr8™ Process Flow • Year-round, continuous process • Leverage the Pulse8 analytics by presenting “the opportunity” to providers • Persistent and Suspected HCC gaps and Quality gaps are presented Extracts of Clinical Data from EMR to Pulse8/Health Plan Clinical Documentation entered into the EMR Pulse8 Analytics identify HCC and Quality Gaps • EMR Extracts enable real/near-time receipt of clinical data to validate conditions • Clinical data will inform member-level analytics 27 Providers see Gaps in the EMR at the Point of Care HCC and Quality Gaps are Pushed to the EMR © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Summary: Innovative Analytics are Essential • 28 Deep understanding of each source of revenue lift for each line of business and timing o ACA’s 3 Rs: Reinsurance, Risk Transfer Payments, Risk Corridors o MA: Premium adjustments by sweeps periods, Mid- and Final-Year Adjustments o Medicaid: State-specific Risk-adjustment, increasingly a blend of MA’s moving sweeps with ACA’s “transfer premiums” • Client-specific intervention analytics reflecting strategy, risk-tolerance, timing, ROI targets, and incentives • Clear line-of-sight throughout the year at progress towards goals for risk adjustment, quality scores, intervention budgets, and ROI • Can statistically model, hence measure, the incremental contributions of interventions while controlling for factors that otherwise would over/understate the ROI: o Reminders: Multiple instances of the same intervention type (e.g. reminder alerts) o Escalations to more intensive, hence costly interventions o Complementary activities such as webinars or site visits for those providers with pending alerts o Natural gap closure – the single-largest contributor to gap closing in most every population • Yield, lift, and ROI estimation by vendor and type of intervention that is transparent, hence credible • Ability to link intervention results to anticipated revenues: ACA transfer payments, MA Stars ©2016 Pulse8 Inc. Confidential and Proprietary. All Rights Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. Reminder Confidential and Proprietary Information Prepared by Pulse8 for GHG Forum: Internal Use and Distribution Only This document is intended for the internal use of recipients only and may not be distributed externally or reproduced for distribution in any form without express written permission of Pulse8 Inc. 29 © 2016 Pulse8 Inc. Confidential and Proprietary. All Rights29 Reserved. Intended For Internal Use of Recipients Only. Do Not Distribute or Reproduce. John Criswell 443-223-2271 John.Criswell@pulse8.com Eric Hedrick 231-215-0770 Eric.Hedrick@Pulse8.com Pulse8.com © 2016 Pulse8, Inc. – Proprietary and Confidential – All Rights Reserved