Sandy Baruah
President and CEO
Detroit Regional Chamber
Health Care In
Transition:
The Big Picture
Paul Keckley
Former Executive Director
Deloitte Center for Health Solutions
Ed Wolking
Executive Vice President
Detroit Regional Chamber
Handling Change:
Challenges and
Opportunities for
Employers
David Lansky
President and CEO
Pacific Business Group on Health
Challenges and Opportunities for
Employers (and by extension, individuals
and employees)
2014 Health Care Leaders Forum
Detroit Regional Chamber
March 12, 2014
David Lansky, PhD
President and CEO
PBGH Members
Apple
Facebook
Google
Hewlett Packard
Microsoft
Oracle
….
©PBGH 2014
9
Value of our $3 trillion system
©PBGH 2014
10
250%
Health Insurance
$2,196Premiums
1999
2000
$10,880*
$4,242*
2006
$11,480*
117%
$12,106*
119%
$12,680*
$4,479*
2007
182%
$9,950*
$4,024*
2005
2008
$4,704*
2009
$4,824
$13,375*
$5,049*
2010
2011
56%
57%
2012
50%
$9,068*
$3,695*
2004
$13,770*
$5,429*
$15,073*
$5,615*
$2,000
14%
$4,000
$6,000
$8,000
$10,000
$12,000
29%
50%
$15,745*
34%
$5,884*
2013
$0
196%
$8,003*
$3,383*
2003
100%
Family Coverage
$7,061*
Overall Inflation $3,083*
2002
150%
Single Coverage
$6,438*
Workers' Earnings
$2,689*
2001
200%
$5,791
Workers' Contribution
$2,471* to Premiums
$16,351*
$14,000
$16,000
$18,000
40%
11%
0%
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2013. Bureau of Labor Statistics, Consumer Price Index, U.S. City
Average of Annual Inflation (April to April), 1999-2013; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment
Statistics Survey, 1999-2013 (April to April).
2013
100%
90%
80%
70%
Percentage of All Firms Offering Health Benefits, 1999-2013
66%
68%
68%
66%
66%
69%*
63%
60%
61%
60%
50%
55%
57%
58%
58%
55%
63%
59%
60%*
59%
61%
57%
59%*
52%
47%
40%
50%
49%
45%
48%*
47%
50%
45%
30%
All Firms
20%
Firms with 3-9 Workers
10%
0%
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
*Estimate is statistically different from estimate for the previous year shown (p<.05).
NOTE: Estimates presented in this exhibit are based on the sample of both firms that completed the entire survey and those that answered just
one question about whether they offer health benefits. The percentage of firms offering health benefits is largely driven by small firms. The large
increase in 2010 was primarily driven by a 12 percentage point increase in offering among firms with 3 to 9 workers. In 2011, 48% of firms with 3
to 9 employees offer health benefits, a level more consistent with levels from recent years other than 2010. The overall 2011 offer rate is
consistent with the long term trend, indicating that the high 2010 offer rate may be an aberration.
SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2013.
2013
Employers considering “exit”
Source:
18th Annual Towers Watson/National Business Group on Health
Employer Survey on Purchasing Value in Health Care (2013)
©PBGH 2014
13
Savings by “Best Performing” Employers
Source:
18th Annual Towers Watson/National Business Group on Health
Employer Survey on Purchasing Value in Health Care (2013)
©PBGH 2014
14
Strategies of “Best
Performing” Employers
Source:
18th Annual Towers Watson/National Business Group on Health
Employer Survey on Purchasing Value in Health Care (2013)
©PBGH 2014
15
Strategies to Improve System Performance
©PBGH 2014
16
Large Employer Strategies
1. Benefit design with strong incentives to consumers:
1.
2.
3.
Tiered networks
Reference pricing
Centers of Excellence (travel surgery)
2. Direct contracting:
1.
2.
3.
4.
Accountable care organizations
Primary care networks
On-site clinics with selected networks
Intensive outpatient care models (serious chronic illness)
3. Payment reform:
1.
2.
3.
©PBGH 2014
Price and quality transparency  “value” based payments
Alignment among private carriers (e.g., bundled payment)
Alignment with Congress, Medicare, states (e.g., SGR fix)
17
Source: Robinson JC and Brown TT, “Increases in Consumer Cost Sharing Redirect Patient Volumes and
Reduce Hospital Prices for Orthopedic Surgery.” Health Affairs 32(8), 2013, pp. 1392-1397.
©PBGH 2014
18
Reference pricing for
lower cost services
Colonoscopy Cost Per Procedure – Greater SF Bay Area MSA
Average Paid for Reference Based Priced Colonoscopies by Year
$1,200
$1,000
$848
$891
$942
$944
$766
$800
$823
Average
Employer
Paid
$600
$400
Average
Allowed
Amount
$727
$798
$855
2009
2010
$873
$717
$740
2012
2013
$200
$2008
2011
• 12% increase in use of labs below reference
price; 6% increase in low-cost imaging centers
• Driven by steerage to specific, named providers
©PBGH 2014
19
©PBGH 2014
20
Where we are today…
• Fading hope that competitive market can work to
manage cost, improve quality
• Potential of rapid shift to defined contribution,
private and public exchanges in next 5-10 years
• Consensus interest in value-based payment,
alignment of consumer and provider incentives,
greater transparency for informed
decisionmaking
• The path is clear. Will leadership appear?
©PBGH 2014
21
Fast-Changing
Relationships: The
Road Ahead for
Employers
Moderator:
•
Kathleen S. Neal, Director of Integrated
Health Care & Disability, Chrysler Group, LLC
Former Executive Director
Deloitte Center for Health Solutions
Panelists:
• John Neuberger, Director of Client
Partnerships, Quad/Graphics
• Randy Vogenberg, Principal, Institute for
Integrated Healthcare
Impacts of
Response: The
Changing Landscape
for Providers
Carlos Jackson
Senior Associate Director, Federal Relations
American Hospital Association
The Changing Landscape for Providers
Carlos Jackson
American Hospital Association
March 12, 2014
ACA implementation
Wednesday, February 15
Naval Heritage Center
9:30 AM
Implementing reform
Regulatory Design
• Insurance reforms
−
−
−
−
High risk pools
Medical loss ratios
Mandates
Insurance exchanges
• Integrated care options
−
−
−
−
Bundling
Accountable care organizations
Medical homes
Center for Medicare and Medicaid Innovation
• Value-based purchasing
• Readmissions
CMS quality and accountability initiatives provide
additional impetus to hospitals’ integration efforts.
Chart 3: Timeline of CMS Value-Driven Payment Initiatives
Meaningful Use (HITECH Act)
Incentive Payments Only
Accountable Care Organizations*
Upside/Downside Risk
Bundled Payments for Care Improvement*
Penalties Only
Nonpayment
Readmission Penalties for Low Performers
Hospital-Acquired Conditions**
Hospital Inpatient Quality Reporting Program (P4R)
Hospital Outpatient Quality Reporting Program (P4R)
Hospital Value-Based Purchasing Program
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
P4R: Pay-for-reporting
HITECH: Health Information Technology for Economic and Clinical Health
*Program is voluntary
**In 2008, Medicare stopped paying for select hospital-acquired conditions (HAC). In FY 2015, Medicare will begin
penalizing hospitals in the top quartile of Medicare HACs .
Source: Centers for Medicare & Medicaid Services
Research and analysis by Avalere Health
2018
Physicians widely anticipate increased levels of
integration with partner hospitals.
Chart 5: Percent of Physicians that Believe Physicians and Hospitals are Likely or
Very Likely to become More Integrated in the Next 3 Years, by Medical Specialty,
2013
73%
71%
66%
63%
61%
All physicians
Primary care
physicians
Surgical
specialists
Non-surgical
specialists
Source: Deloitte Center for Health Solutions (2013). Deloitte 2013 Survey of U.S. Physicians.
Research and analysis by Avalere Health
Other
Integration helps hospitals gain efficiencies through
economies of scale.
Chart 6: Economies of Scale with Increasing Patient Population
Fixed
Costs
Variabl
e
Costs*
1 patient
2 patients
4 patients
Fixed costs, such as medical technologies, are spread across each patient. The more patients
that need the technology, the lower the cost per patient.
Variable costs, such as labor costs, scale with the number of patients. As the number of
patients increases, variable labor costs can decrease over time due to new efficiencies.
Source: Bond, R. (2012). American Healthcare Industrial Revolution: Economies of Scale and the Accountable Care
Organization (ACO). ACODatabase.com.
Research and analysis by Avalere Health
Current legal and regulatory barriers are a deterrent
to innovative clinical integration efforts.
Chart 7: Legal Barriers to Integrated Care Delivery
Law
What is Prohibited?
The Concern Behind the Law
Unintended Consequences
How to Address?
Antitrust (Sherman Act)
Joint negotiations by providers
unless ancillary to financial or
clinical integration; agreements
that give health care provider
market power
Providers may enter into
agreements that either are nothing
more than price-fixing, or which give
them market power so they can
raise prices above competitive
levels
Deters providers from entering into
procompetititve, innovative
arrangements because they are
uncertain about antitrust
consequences
Additional guidance from antitrust
enforcers to clarify when
arrangements will raise serious
issues; guidance is currently available
for federally-designated accountable
care organizations (ACOs)
Ethics in Patient
Referral Act (“Stark
Law”)
Referrals of Medicare patients by
physicians for certain designated
health services to entities with
which the physician has a
financial relationship (ownership
or compensation)
Physicians may have financial
incentive to refer patients for
unnecessary services or to choose
providers based on financial reward
and not the patient’s best interest
Arrangements to improve patient
care are banned when payments tied
to achievements in quality and
efficiency vary based on services
ordered instead of tied to hours
worked
Congress should remove
compensation arrangements from the
definition of “financial relationships”
subject to the law. Arrangement would
continue to be regulated by other
laws.
Anti-kickback Law
Payments to induce Medicare or
Medicaid patient referrals or
ordering covered goods or
services
Physicians may have financial
incentive to refer patients for
unnecessary services or to choose
providers based on financial reward
and not the patient’s best interest
Creates uncertainty concerning
arrangements where physicians are
rewarded for treating patients using
evidence-based clinical protocols
Congress should create a safe harbor
for clinical integration programs
Civil Monetary Penalty
(CMP)
Payments from a hospital that
directly or indirectly induce a
physician to reduce or limit
services to Medicare or Medicaid
patients
Physician may have incentive to
reduce the provision of necessary
medical services
As interpreted by the Office of the
Inspector General (OIG), the law
prohibits any incentive that may
result in a reduction of care, even if
the result is an improvement in the
quality of care
The CMP law should be changed to
make clear it applies only to the
reduction or withholding of medically
necessary services
IRS Tax-exempt Laws
Use of charitable assets for the
private benefit of any individual or
entity
Assets that are intended for the
public benefit are used to benefit
any private individual (e.g., a
physician)
Uncertainty about how IRS will view
IRS should issue guidance providing
payments to physicians in a clinical
explicit examples of how it would
integration program is a significant
apply the rules to physician payments
deterrent
to the
teamwork
needed
for
inHealth
clinical integration programs
Research
and
analysis
by Avalere
clinical integration
 Labor
 Life-saving
technology/Rx
 Older, sicker
patients
 Redundant
regulation
Hospital
Squeeze
 Government
payment
 Private payor
pressure
 New care delivery
models
 Liability
insurance
 Info technology
 Emergency
readiness
 Rising uninsured
Hospital Vulnerability List
Options for offsets and deficit reduction
•
•
•
•
•
•
•
•
Prospective coding offsets ($8 billion)
Site neutral payment policies
 E&M code/HOPD ($10 billion)
 66 additional APCs procedures ($9 billion)
 12 procedures performed in ASCs ($6 billion)
Hospital bad-debt reductions ($20 billion)
GME reductions ($10 billion)
CAH: payment reductions and qualification criteria ($2 billion)
Post acute care ($70 billion)
IPAB expansion ($4.1+ billion)
Medicaid:
 State provider assessments ($22 billion)
 Medicaid DSH “rebasing”
Impact of site neutral payment options
Medicare Margins for Hospital
Outpatient Department Services
2007-2011 and Projected with MedPAC Proposed Cuts
0%
-2%
2007
2008
2009
2010
2011
Projected
w/Cut
-4%
-6%
-8%
-10%
-12%
-14%
-11.7%
-10.5%
-11.0%
-12.2%
E&M Only
-13.7%
-14.4%
-16%
E&M and 66
-18%
-20%
-17.7%
E&M, 66 and 12
Source: Medicare Payment Advisory Commission, December 2012 meeting materials
and June Report to Congress.
-20.0%
President’s FY 2015 Budget
$414 Billion in Medicare
and Medicaid Cuts
Key hospital provisions
• Replace remaining sequestration with other savings
• Reduce GME by $14.6 billion (proposes $5.23 billion for
13,000 new residency slots through a new competitive
GME program)
• Strengthen IPAB ($12.9 billion)
• $112 billion in post-acute cuts (site-neutral SNF/IRF,
60% rule, reduces updates)
• Phase out Medicare bad-debt payments by $30.8 billion
• Rebase Medicaid disproportionate share hospitals in FY
2024 for savings of $3.26 billion
• Critical Access Hospitals: 101% to 100% and 10 mile
designation ($2.4 billion reduction)
The Two-Midnight Rule
• CMS will generally consider hospital
admissions spanning two midnights
as appropriate for payment under
the inpatient prospective payment
system (PPS).
• In contrast, hospital stays of less
than two midnights will generally be
considered outpatient cases,
regardless of clinical severity.
1
On the Horizon:
What’s Around the
Corner for Providers?
Moderator:
•
Laura Appel, Vice President of Federal Policy and
Advocacy, Michigan Health & Hospital Association
Panelists:
• Gina Buccalo, MD, Chief Medical Officer, Partners
in Care
• Carlos Jackson, Senior Associate Director, Federal
Relations, American Hospital Association
• Michael Madden, President and CEO, The
Physician Alliance
Lunch and Networking
Challenges for the
Government – The
Federal Response
Tevi Troy
President
The American Health Policy Institute
Tevi Troy, President
The American Health Policy Institute
Perspectives of an insider
 Policy makers inside government have different
perspectives from those in the private sector.
 They are often equally competent but they're looking
at things from a different angle have different bosses
and different constituencies to satisfy.
 In addition they are subject to different rules. The APA
governs how regulations are determined and puts the
development of regulations in a very tight stricture.
Perspectives of an insider
 One of the challenges in developing the website was that
policymakers had to use federal contractors, a universe
with a high bar to entry, using "cost-plus" reimbursement,
and requiring certifications of compliance with OFCCP,
acquisition requirements, and other federal standards.
 It is true that policymakers come with results that differ
from one of those in the private sector would have come up
with, but much of this stems from the different perspective
and the different rules the government imposes, as well as
their lack of private sector experience.
Coping with a Challenging and Uncertain
Regulatory Environment
 Health care faces significant policy challenges.
 Health care environment rife with regulatory
uncertainty.
 Post-elections/Supreme Court/mandate
delay/Shutdown fight, regulatory landscape and
employer responses will determine the disposition of
the ACA more than Congress in the short term.
OBAMA ADMINISTRATION’S TOP ISSUES
Immigration
Education
Faith-Based
Initiatives
HIV/AIDS
Seniors
Rural
Taxes
Economic
Recovery
Technology
Science
Oceanic Policy
Energy &
Environment
Transportation
Sportsmen
Veterans
Child
Advocacy
Social Security
Civil Rights
Disabilities
Foreign Policy &
Defense Women
Science
Family
Poverty
Healthcare
Reform
Service
Urban Policy
Arts
Ethics
51
52
OBAMA ADMINISTRATION’S
TOP ISSUES:
Healthcare Reform
• Increasing costs
•
1960: healthcare 5% of GDP
•
2011: healthcare 17.9% of GDP - $2.7 trillion
•
2021 (projected), $4.8 trillion - 19.6% of GDP
•
Government expected to spend $2.4 trillion (50% of
healthcare spending)
US Health Care Costs
 US Average annual cost of health care was $8,233 per capita




-- 2.7x Japan’s in 2010
U.S. households spent 6% of their annual incomes on health
costs
U.S. performs more expensive diagnostic tests, such as
MRI’s and CT’s
On the other hand, the U.S. does not have an excessive
number of doctors or hospital beds relative to its
population
Similarly, duration of hospital stays is not above average
53
http://www.pbs.org/newshour/rundown/2011/11/why-does-healthcare-cost-so-much.htm
2030 Baby Boomer Projections
 In 2030:
 The over 65 population will be at 72,091,915
 (19% of the overall U.S. population) - 40,228,712
million in 2010 (13% of overall U.S. population)
 Over 21 million will be considered obese
 Approx. 14 million will be living with diabetes
http://www.census.gov/prod/2010pubs/p25-1138.pdf
http://www.aoa.gov/aoaroot/aging_statistics/future_growth/future_growth.aspx#age
www.aha.org/content/00-10/070508-boomerreport.pdf
Breakdown of National Health Care Expenditures:
Office of the Actuary
1965-2010 Source:
of the Center for Medicare
Percentage of Total National Health Care
Expenditures
60%
and Medicaid Services
Private Insurance
50%
Out-of-Pocket
40%
Medicare
30%
20%
Medicaid
10%
0%
1960
1970
1980 1990
Year
2000
2010
CHIP, DOD, VA., 3rd Party Payers,
Federal/State/Local Research,
Structures & Equipment
Before Reform Became Law…
 5 different committees
 3 House
 2 in Senate
Two Houses of Congress
 House Floor
 Senate Floor
 Conference
 In Senate
 Reconciliation (51 votes) or Regular Order (60)
 Presidential Signature
56
57
58
Analysis of CHT Timeline
Type
Preenactment
Upon
enactment
6
month
s post
enactment
By
Jan 1,
2011
1 year
post
enactment
1 year
post
enactment
to Jan 31,
2011
Jan1,
2012-Dec
31, 2013
20142020
Total
Percent
of total
Medicare
7
29
7
44
7
11
34
24
163
35
Medicaid
5
3
3
7
4
2
3
17
44
9
CHIP
0
0
1
1
1
0
2
0
5
1
Public
health
1
44
6
5
5
4
9
5
79
17
HHS
0
0
2
0
1
0
1
0
4
1
Taxes
3
3
1
6
0
0
10
12
35
7
Insurance
0
3
12
2
3
1
9
21
51
11
Long-term
care
0
0
0
0
0
0
2
0
2
<1
IHS
1
68
1
0
7
4
5
0
86
18
Total
17
150
33
65
28
22
75
79
469
100
Percent of
total
4
32
7
14
6
5
16
17
100
60
How did we get here?
Intense effort to micromanage
• The Affordable Care Act (ACA) has required almost
20,000 pages of regulations, elaborating on the original
2,700 page law.
• Can be very specific. Consider Section 4102 of the ACA,
which states: "The secretary shall develop oral
healthcare components that shall include tooth-level
surveillance.”
• Not necessarily welcome: 51% of doctors percent felt
that the law would have a negative impact on their
relationships with their patients
61
Outlook of the next four years
 ACA will not be overturned before 2017
 Implementation challenges greater than expected,
but do not change the central dynamic:
 Democrats will never admit full extent of the
law’s shortcomings
 Republicans will never call the law a success
even if it works as promised
 How should people judge the law?
Judging the Law
 Evaluate the law based on its 3 main goals
 Universal coverage
 “Bending the cost curve”
 The guarantee of the ability to keep current plan
Promise:
Universal Coverage
 Ranging number of uninsured, between 30 – 47 million
people
 Moral imperative to cover people
 Most expansive definitions of the uninsured that
President Obama used included both illegal
immigrants, as well as individuals, who were already
eligible for public assistance, but not partaking in it
Promise:
“Bending the cost curve”
 President Obama claimed he would reduce premium costs
by $2,500 for a family of four
 There is tension between the goal of universal coverage and
the effort to bend the cost curve
Promise: “If you like your health
care you can keep it.”
 Became standard response to the public’s skepticism of
the ACA
 President Obama mentioned it nearly every time he
spoke of the law
 Some sources say he said it hundreds of times
 The promise was to ensure Americans that the law
would not affect 85% of Americans that already had
health insurance
Other metrics to evaluate
 ACA imposes $1.1 trillion in new taxes over the first 10
years
 Employers are trying to stay under 50 employees, or
30 hr threshold
 Health care market has been one of the only sectors
continuing to hire during the recession
 In September 2013 there were more layoffs among
health-care providers than in any other industry
Legislation - GOP Alternative
 Senate Republican Proposal
 Keeps most popular provisions of the ACA
Guaranteed issue, coverage of dependents to age 26, no lifetime
limits
Repeals more than a dozen ACA taxes and the employer mandate
Provides continuous coverage protection for pre-existing
conditions
Gives tax credits to people who are not employed at large
companies
Limits tax exclusion of employer provided health benefits to 65
percent of plan costs.
o




68
American Health Policy Institute
 American Health Policy Institute
 AHPI is a non-partisan 501 (c)(3) think tank focused on
health care policy and the employer-based system.
 AHPI will be looking at: how the ACA affects employers;
what employers are doing about ACA; and policy
recommendations.
o The first study from AHPI will be on employers costs
under ACA
69
Going forward?
 Democrats are adamant the law stay in place.
 Republicans are adamant the law goes.
 This dynamic means there is no pathway for real
improvement of changes during the remainder of the
Obama administration
 Employers need to chart a path forward, recognizing that
they will get little help from Washington. This requires two
steps:
 Creating health care plans that work for employers and
employees within the current structure
 Laying the groundwork now that will have to come in the
future administration
Transparency: The
Root of all Reform
Jay Want, MD
Principal
Want Healthcare, LLC
The Transparency Remedy
Will seeing what you’re buying
increase value?
Searching for the cure to health
care costs…
Units X Price = Cost, right?
Quick Quiz: What causes American Health
Care to be more expensive than HC in
other countries?
• We uses more stuff, i.e., it’s a units
problem, mostly.
• The stuff we use is higher priced, i.e., it’s a
price problem, mostly.
• Both in roughly equal measure.
How did it get this way?
• Fee for service= accountability for activity,
not for outcomes
• Industry consolidation for two decades =
oligopoly formation
• Third party payer system: those who use
the service and provide the service don’t
pay for the service = moral hazard
Where current reform schemes
work
• Units
– Pay for performance
– Nonpayment for
readmissions
– Bundles
– Capitation
• Prices
– Benefit design, e.g.
reference pricing
– Price transparency
Consumers…
“How much will
my knee MRI
cost and what
are my best
options?”
Businesses…
“Which health
plan provides
the best value
providers for
our premium?”
Providers and
Facilities…
Legislators and
Policy Experts…
“How do I
compare to my
peers and
demonstrate
value?”
“How does cost,
utilization and
quality compare
between public
and private
payers?”
Providing Answers to:
83
State
Statewide
or partial
geographi
c area
Statutory or
voluntary
Provides
consumer
focused
reporting
Currently
collecting
data?
Currently
doing any
kind of
public
reporting?
1.
Maine
Statewide
Statutory
Yes
Yes
Yes
2.
NH
Statewide
Statutory
Yes
Yes
Yes
3.
VT
Statewide
Statutory
Yes
Yes
4.
MA
Statewide
Statutory
Yes
Yes
5.
MD
Statewide
Statutory
Yes
Yes
6.
KS
Statewide
Statutory
No
No
7.
UT
Statewide
Statutory
No
No
8.
TN
Statewide
Statutory
No
No
9.
MN
Statewide
Statutory
Yes
No
(reports
are not
public)
10.
Colorado
Statewide
Statutory
Yes
Yes
11.
Oregon
Statewide
Statutory
Yes
No
12.
Wisconsin
Partial
Voluntary
Yes
No
13.
Washington
State
Partial
Voluntary
Yes
No
Yes
No
Status of state APCDs
• 11 statewide, statutory APCDs, including Colorado, that
have collected data. There are two states that have
voluntary data for part of the state (WI, WA).
•
• Oregon has not issued any reports yet, so that is why the
count is often “10 APCDs.”
•
• Seven states have issued reports at one time or another.
(ME, NH, VT, MA, MD, KS, UT).
•
• Five states allow data release: ME, NH, VT, MA, CO
•
• Three states do consumer focused reporting: ME, NH,
MA and soon CO
86
Highlights from New Release
88
89
Snapshot Reports Highlighting Variation
Will market forces regulate prices?
• Motivated purchasers/consumers
– Benefit design, high deductible
– Reference pricing strategies
• Transparent pricing
• Transparent and relevant quality
• Willing competitors
– Centers of excellence strategies
CMS moving toward greater
transparency
CMS NEWS Feb. 21, 2014
Quality Data Added to Physician Compare
WebsitePatients Get More Information to Help
Find a Doctor
Today, the Centers for Medicare & Medicaid Services (CMS)
announced that for the first time, quality measures have been
added to Physician Compare, a website that helps consumers
search for information about hundreds of thousands of
physicians and other health care professionals. The site helps
consumers make informed choices about their care.
What you’d want to make prices
real and accurate
• Paid amounts, not charges
• Large database so results are statistically
significant
• Acuity adjustment methodology that
doesn’t penalize providers who take care
of sicker patients
Take Homes
• While we have room to improve on how
much HC we use, we’re not that different
from others in this regard
• Where we do differ is that our prices are
much higher for the same services
• While much of HC cost containment to
date has been focused on lowering
utilization (units used), we must focus
attention on prices as well
Take Homes
• One of the ways we might get better
pricing is more transparency
• APCDs offer the chance to get the biggest
datasets available
• Oligopolies generally oppose
transparency, as they are designed to
maintain higher prices and to avoid price
competition
Ed Wolking
Executive Vice President
Detroit Regional Chamber
LEAPFROG HOSPITAL RECOGNITION
PROGRAM (LHRP)
2013 MICHIGAN HOSPITALS
Mercy Memorial Hospital System
Metro Health Hospital
OSF St. Francis Hospital
Port Huron Hospital
Botsford Hospital
Saint Mary's Health Care
Bronson Battle Creek
Sinai-Grace Hospital
Bronson Methodist Hospital
Sparrow Hospital & Health System
Carson City Hospital
Sparrow Ionia Hospital
Chelsea Community Hospital
Spectrum Health Blodgett Hospital
Children's Hospital of Michigan
Spectrum Health Butterworth Hospital
Clinton Memorial/Sparrow Clinton
Spectrum Health Gerber Memorial
Covenant Medical Center Harrison Campus
Spectrum Health Kelsey Hospital
Detroit Receiving Hospital/University Health Center
Spectrum Health Reed City Hospital
Dickinson County Healthcare System
Spectrum Health United Hospital
Genesys Regional Medical Center
Spectrum Health Zeeland Community Hospital
Harper-Hutzel Hospital
St. Joseph Mercy Hospital, Ann Arbor
Helen DeVos Children's Hospital
St. Joseph Mercy Livingston Hospital
Hillsdale Community Health Center
St. Joseph Mercy Oakland
Huron Medical Center
St. Joseph Mercy Port Huron
Huron Valley-Sinai Hospital
St. Mary Mercy Hospital
McLaren - Northern Michigan
Three Rivers Health
Mercy Health Hackley Campus
University of Michigan Hospitals and Health Centers
Mercy Health Mercy Campus
War Memorial Hospital
TOP HOSPITALS IN MICHIGAN - 2013

Recognition for top performing hospitals - Leapfrog Hospital Survey


Top Hospital (hospitals coded as Urban)

DMC Detroit Receiving Hospital and University Health Center

Mercy Health Saint Mary's
Top Children’s Hospital


DMC Children's Hospital Of Michigan
Top Rural Hospital (includes Critical Access Hospitals)

OSF St. Francis Hospital & Medical Group

Spectrum Health Kelsey Hospital
Regional Initiatives:
Detroit and
Michigan-Miles to
Go Before We Sleep?
Moderator:
•
Kirk Roy, Vice President, Office of National Health
Reform, Blue Cross Blue Shield of Michigan
Panelists:
• Kate Kohn-Parrott, President and CEO, Greater
Detroit Area Health Council
• Christopher Priest, Senior Strategy Advisor, Office
of the Governor
Roundtables and
Networking