Opening Keynote: "The Road to Health System Reform" by Stephen Ondra, SVP and Chief Medical Officer, Health Care Service Corporation

1. The Road to
Health System
Reform
Dr. Stephen Ondra
SVP and Chief Medical Officer,
Health Care Service Corporation
Follow me on Twitter @StephenOndra

2. How Does the U.S. Compare?
extra trillion
dollars
If the United States spent the same
percentage of GDP on health care in
2014 as the next-highest spending
country, the U.S. would have an
JAMA
November 26, 2014
2@StephenOndra

3. “Of all the forms of
inequality, injustice
in health care is
the most shocking
and inhumane.”
– Dr. Martin Luther King Jr.
3@StephenOndra

4. Perfect laws come from
mountains, written
on stone tablets;
the ACA is not a perfect law, but
it is
a start that has catalyzed
change. 4@StephenOndra

5. Fewer Uninsured Adults
Source: Gallup-Healthways Well-Being Index, GALLUP. http://www.gallup.com/poll/184064/uninsured-rate-second-quarter.aspx
Do you have health insurance coverage? Among adults aged 18 and older
% No
Q1
2009
Q1
2010
Q1
2011
Q1
2012
Q1
2013
Q1
2014
11.4
Q1
2015
Percentage of U.S. Adults Without Health Insurance, by Quarter
Q2
2015
@StephenOndra

6. Most Affordable Care Act Coverage Enrollees are
Satisfied with Their
Insurance
and Getting Care They Could Not Have Afforded Before
Source: Commonwealth Fund ACA Tracking Survey. http://www.commonwealthfund.org/acaTrackingSurvey/index.html
COVERAGE
59%
More than half of adults
enrolled in marketplace plans
or Medicaid were previously
uninsured.
AWARENESS
59%
Nearly six of 10 adults
who are uninsured are aware
of the marketplaces.
VALUE OF COVERAGE
Nearly nine of 10 adults who
are currently insured through
the ACA marketplaces or
newly insured in Medicaid are
satisfied with their health
insurance.
86%
@StephenOndra

7. Changing Provider Landscape
130,600
by 2025
Increased
Cost:
up to 20%
7@StephenOndra

8. 1930
1980
2010
Today
8
@StephenOndra

9. Electronic Health Records
Increased
Value?=

10. Breakthrough
Technology
10
will change how we manage health and health care
@StephenOndra

11. Technology is Redefining
the Health Care Infrastructure
• Mobile technology, tele-health /
telemedicine
• New devices to reshape health
management concepts and models of
care
• Wearable devices and monitors
• Personalized medicine (genetics)
• Data liquidity
• The connection of population big data to@StephenOndra

12. The Shift to & Challenges of Value Based
Care
12@StephenOndra

13. Purchasers are Seeking New
Solutions
Almost a quarter (23%) of employers
offering health benefits use some
form of narrow networks in their
plans. – Kaiser/HRET 2013 Survey of
Employer-Sponsored Health Benefits
A University of Chicago survey found that 57 percent
of small employers would opt for a high performance
network if it would lower costs by 5 percent or more.
– Society for HR Management, Aug 2014
Large Employers differentiating cost sharing for
high-performance networks have doubled between 2014 and 2015.
– 2014 19th Annual Towers Watson/National Business Group on Health Employer Survey on Purchasing Value in Health Care
Price is the major but not only driving
factor when individuals choose a policy
– 2014 Post Market Analysis
13
@StephenOndra

14. Convergence of Public and Private
Policy
14

15. Target percentage of Medicare FFS payments linked to
quality and alternative payment models in 2016 and 2018
30% 50%
Alternative
Payment Models
(categories 3-4)
Alternative
Payment Models
(categories 3-4)
FFS Linked to Quality
(categories 2-4) FFS Linked to Quality
(categories 2-4)
85%
90%
@StephenOndra

16. SGR Repeal: Encouraging APM
Participation 16
@StephenOndra

17. Merit-Based Incentive
Payment System (MIPS)
Advanced Alternative
Payment Model (APM)
Regulations, restrictions and penalties
25% of Business in Alternative Payment Models
Significant share of provider revenue, two-sided
risk, financial incentives & exemption from MIPS
requirements
 5.0% bonus each year from 2019-2024 if APM
revenue met
 Annual updates of 0.75% after 2026
 A higher annual growth rate in the fee schedule
 Exemption from the Merit-Based Incentive
Payment System (MIPS) and other
requirements
Fixed Funds: Some Winners, Some Losers
 Annual update of 0.5% from 2015 - 2019
 Annual updates based on MIPS performance
from 2020 – 2025. These can be a negative,
zero, or positive adjustment.
 Annual updates of .25% after 2026
 Sunsets current Meaningful Use, Value-Based
Modifier, and Physician Quality Reporting
System (PQRS) penalties at the end
of 2018, rolling requirements
into a single program
@StephenOndra

18. Reimbursement is Quickly Being Linked To
Quality And Not Just Volume of Service
11%
40%
75%
20%
85%
90%
30%
50%
Value-Oriented Payments:
Medicare + Commercial +
FFS Linked to Quality
18
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
@StephenOndra

19. Learning Action Network
19
@StephenOndra

20. The Path to Value
AC
A
FFS
to
FFV
CMS
Targets
20@StephenOndra

21. Measuring Value: Focusing on the
Numerator
550
measures
in use by
23 Payers
95%
Different
R E D U C E
5%
the
SAME
21@StephenOndra

22. Measuring Value: Focusing on the
Numerator
R E F I N E
22@StephenOndra

23. R E L AT E
Measuring Value: Focusing on the
Numerator
What Matters Most to
Patients and Providers?
@StephenOndra

24. Is Value Based Care Working?
▲19%
ACO Quality Scores
▲30/33
Improved Quality Measures
▼$817,000,000
Generated Savings To Date
=Value
COST
QUALITY
Medicare and Medicaid shared savings program two-year results
24@StephenOndra

25. From Claims Reimbursement To……Partnering with Providers to Become a
Care Management Company.
25@StephenOndra

26. 20%
50%
28%
2%
HOW We Segment The Population According To Health
Needs
Middle 44%
Healthy
Chronic Controlled
Conditions
Top 5%
Top 1%
Poorly Controlled or Significant
Multiple Chronic Conditions
Dominant Chronic or Major Event
Bottom 50%
Percent of SpendingPopulation
26@StephenOndra

27. Choosing
the Right
Tool
for the Job
27@StephenOndra

28. Value Creation Toolbox
.
Pay for
Performance
Fee-for-
Service
Global Risk
or % of
Premium
Shared Risk
HMO
Bundled
Payment
Medical
Home
Accountable
Care
Organization
Overlapping
Care Management
Delegated
Care Management
28
Care
Management
Approach
Population Health
Provider Accountability
@StephenOndra
Traditional
Care Management

29. BCBSIL Practice Advancesm
Physician-Led Accountable Care
+
A value-based care model with DuPage Medical
Group, the largest independent physician practice in
the Chicago area, with more than 425 doctors.
Enables physicians to reduce their costs while
maximizing quality by offering a turn-key ACO tool kit to
help networks with rapid ACO creation and effective
management
@StephenOndra

30. Smarter Networks for Higher Value
30@StephenOndra

31. The Role of the Payer in VBC
Facilitate Provider Success
 Provide Information
 Identify & promote technology
 Quality Measures
 Cost Measurements
 Member Experience
31@StephenOndra

32. The ACA Has Accelerated Change
HCSC and the payer industry as a whole will evolve by
redefining our value proposition,
collaborating with providers in new ways, and
engaging and empowering the consumer
Transformation of the health
space requires innovation,
adaptation
and collaboration 32

33. “Change has considerable psychological
impact on the human mind.
~To the fearful it is threatening because
it means that things may be worse.
- King Whitney Jr.
Wall Street Journal, June 7, 1967
~To the hopeful it is encouraging
because things may get better.
~To the confident it is inspiring
because the challenge exists
to make things better.”
@StephenOndra

34. Working together, we can make a
more accessible, equitable and
economically sustainable health
system.
Follow me on Twitter
@StephenOndra
Thank you!