Health Care 2020: Emerging Innovations in the Health Care Payment and Delivery Landscape


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Presentation by Aneesh Chopra, Assistant to the President & US Chief Technology Officer

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Health Care 2020: Emerging Innovations in the Health Care Payment and Delivery Landscape

  1. 1. HBS Health Industry Alumni Conference March 14, 2012 Health Care 2020 ©2012 THE ADVISORY BOARD COMPANY Emerging Innovations in the Health Care Payment and Delivery Landscape
  2. 2. 2 Looking to Put Health Care on a Budget Three Manifestations of Health Care on a Budget Federal Budget Framework Budgeting in the Private Market 3 Growth Rate 1 2 Health Care Inflation Individuals on a Budget ©2012 THE ADVISORY BOARD COMPANY Inflation Time Source: Health Care Advisory Board interviews and analysis.
  3. 3. 3 Budgeting in the Private Market Driving Innovation in the Commercial Market Commercial Insurers Following Medicare’s Lead Providence Health & Services: $30 M, two-year contract with public employee benefits board Blue Shield California: Two ACOs in Northern California ©2012 THE ADVISORY BOARD COMPANY Anthem Blue Cross: ACO pilot with Sharp HealthCare medical groups BCBS Minnesota: Shared savings contract with five providers BCBS Illinois: Shared savings contract with Advocate Health Care Humana: ACO pilot with Norton Healthcare UnitedHealth Care: ACO with Tucson Medical Center Maine Health Management Coalition: Multi-stakeholder group supporting ACO pilots BCBS Massachusetts’s Alternative Quality Contract: Annual global budget, quality incentives for participating providers Aetna: ACO pilot with Carilion Clinic CIGNA: Medical home contract with Piedmont Physicians Group Source: “Anthem Blue Cross, Sharp HealthCare Pilot San Diego-Area ACO,” available at:; “Norton Healthcare, Humana Launch ACO Pilot,” “Aetna, Carilion Clinic Building ACO in VA ,” available at; “An ACO Takes Root in San Francisco,” available at:; “8 Aspects of UnitedHealthcare's Plans to Fund an ACO at Tucson Medical Center,” available at:; “Advocate Health Care, Blue Cross and Blue Shield of Illinois Sign Agreement Focusing on Improving Quality, Bending the Health Care Cost Curve,” available at:; “Minnesota’s Largest Health Plan Signs ‘Total Cost Of Care’ Agreement With Park Nicollet Health Services,” available at:; “BCBS Massachusetts Announces First Year Results of Alternative Quality Contract,” available at:; “CIGNA and Piedmont Physicians Group Launch Accountable Care Organization Pilot Program,” available at:; Maine Health Management Coalition, available at:; Health Care Advisory Board interviews and analysis.
  4. 4. 4 Looking Ahead to a Decade (or More) of Change Entering an Era of “Accountable Care” Betting on a Provider-Driven Solution Set Hospitals • Consolidation and integration Payers Patients • Continuum-wide care • Efficiency and standardization • Public—price cuts and risk shifts • Private—risk-based contracting • All—value-based payment models Doctors Employers ©2012 THE ADVISORY BOARD COMPANY Who’s “accountable”? • Group aggregation and employment • Increased cost-sharing with employees • Enhanced primary care practice • Embedding IT to drive to EBM1 • Heavier emphasis on health management • Defined (or no) contribution 1) Evidence-based medicine
  5. 5. 5 Argument in Brief There Has Never Been a Better Time to Be an Innovator in Health Care Information Liberation + ©2012 THE ADVISORY BOARD COMPANY New Incentives = Rocket Fuel for Innovation
  6. 6. 6 Open Health Data Engaging Citizens in Health Improvement at the Community-Level Community Health Provider Directories & Quality Govt Spending HHS(Growing) Catalog of Liberated Data ©2012 THE ADVISORY BOARD COMPANY Medical/Scientific Knowledge “Blue Button” Consumer Product Information Source: Asthmapolis, iTriage, Ozioma, Healthline.
  7. 7. 7 “Deep Dive” – Data Liquidity for Personal Health Blue Button,” DIRECT - Government Startups that Scale ©2012 THE ADVISORY BOARD COMPANY “Blue Button” in Brief President challenges VA to deliver simple health download from PHR on 08/10; delivered 10/10 and has >400,000 users to date “Direct” Secure Email Standard An open collaboration to develop a simple method for enabling secure Internet-based health data transmission; specs posted in 90 days; first production transaction 1/11; implementation by 65+ vendors Source:;
  8. 8. 8 New Incentives, Part I “Meaningful Use” Growing Evidence Linking Quality to Health IT Adoption Office-Based Physicians an EHR ePrescribing on the Surescripts Network Cleveland Clinic Providers using EHRs vs. Paper Records 40.2% 51% 44% 20.7% 16% 0.8% *Denominator Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 ©2012 THE ADVISORY BOARD COMPANY 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Quality of Diabetes Care Dramatic uptick in EHR adoption – nearly doubling in one year and on track to support “meaningful use” in the coming years 7% % Obtaining All % Obtaining 4 of 5 Recommended Outcome Standards Care Processes Care Processes: Measure Hemoglobin; Kidney Mgmt; Pneumococcal Vaccine; Eye Exam Outcomes: LDL<100 mg/dl; smoking; glycated hemoglobin <8%; BP <140/80; BMI<30 Source: Office of the National Coordinator for Health IT; Source: Cebul, Randall D., et al. New England Journal of Medicine, August 2011; Surescripts.
  9. 9. 9 Cultivate Innovation Ecosystems Substitutability the Key Design Principle to Modular Development 3rd Party Applications Dr. Gunston Ho ©2012 THE ADVISORY BOARD COMPANY Extending the EHR Search Tool Extends Aids Care Primary care clinic earns 180% of Medicaid to improve care coordination; adopts EHR with support from extension center EHR interoperates with modern search tool to better manage care population Source: Dr. Gunston Ho, Apixio;
  10. 10. 10 Information Asset Looking Ahead to a Wired Health System Emerging Data Systems Change Outlook of Competitive Asset Today: Differentiate on Data Access Disruptive Technologies Future: Differentiate on Data-Informed Care Plan • Focus on data ownership • Cloud Computing • Data is prescriptive, predictive • Health system has possession of “the wires,” proprietary data • National Network • Focus on EHR1 capability • Health Information Exchanges • Compete in a world of greater transparency • Data analysis conducted in silos “ ©2012 THE ADVISORY BOARD COMPANY Physicians on the Fast Track “Cloud-based technologies and PHRs1 are potential examples of disruptive technologies in health IT. These types of technologies might allow the 80 percent of physicians who are non-digital to leapfrog some of the existing limitations of EHR systems directly into more modern technologies.” Report to the President President’s Council of Advisors on Science and Technology 1) Electronic Health Record. Source: Executive Office of the President, “Realizing the Full Potential of Health Information Technology to Improve Healthcare for Americans: The Path Forward,” available at: ostp/pcast-health-it-report.pdf, accessed April 26, 2011.; Health Care Advisory Board interviews and analysis.
  11. 11. 11 New Incentives, Part II: Payment Reform Pay for “Value” to Drive New Markets for Care Coordination Services Patient Centered Medical Homes • Organized outpatient care, coordination and team-based approaches Accountable Care Organizations • Shared savings; Redesigned care processes for high quality, efficient delivery Innovations Needed: • Data Mining/Analytics • Care Integration Tools • Timely Clinical Data, Decision-Support ©2012 THE ADVISORY BOARD COMPANY Bundled Payments • Pilot program for episodes of care; incentivizes reduced costs around eight conditions • Technology to Extend Physician Reach • Consumer Engagement Tools/Platforms/Apps Readmission Reduction Programs • Motivates hospitals to engage with care coordinators and better organize delivery systems
  12. 12. 12 Shifting Risk and Accountability to Providers Providing an Incentive to Remake the Delivery System Capitation/Shared-Savings Models Episodic Bundling Degree of Shared Risk Hospital-Physician Bundling ©2012 THE ADVISORY BOARD COMPANY Pay-for-Performance Care Continuum Source: Health Care Advisory Board interviews and analysis.
  13. 13. 13 Chronic Disease Growth Outpacing Population Growth Projected Increase in Chronic Disease Cases 2003-2023 62.0% 53.0% 39.0% ©2012 THE ADVISORY BOARD COMPANY 29.0% 41.0% 54.0% 19%: Projected population growth, 20032023 31.0% Source: Milken Institute, available at: pdf/chronic_disease_report.pdf, accessed April 27, 2011; Health Care Advisory Board interviews and analysis.
  14. 14. 14 Enabling Constant Monitoring of Health Status Reminders Help Patient Stay on Track and Reinforce Care Plan Activation On the Go 45 WellDoc Alert “Your most recent blood test shows that you have low blood sugar. It’s time to treat this before you eat your meal or take your meal time medication.” Advice Triaged Across Multiple Sources • Real-time biometric alerts via text message • Longitudinal alerts and reminders via web portal • Secure provider communication via e-mail ©2012 THE ADVISORY BOARD COMPANY Technology in Brief: WellDoc, Inc. • Health care technology company based in Baltimore, Maryland • Initial clinical trials showed successful reduction of HbA1c levels by 2.03 percent • Mobile health coach device can be used with variety of patients; with or without physician participation • Two-year, 225-patient effectiveness study completed January 2010; participants included University of Maryland, Care First Blue Cross Blue Shield, Sprint, LifeScan Source: WellDoc Inc., available at:, accessed: May 4, 2011; Health Care Advisory Board Interviews and analysis.
  15. 15. 15 Putting it Altogether ©2012 THE ADVISORY BOARD COMPANY Telemedicine an “Embedded” Asset in Care Delivery Patients can consult with a CareClix physician from the comfort of their home or office. No equipment or special hardware needed. Mobile apps are available for mobile patient. Little or no wait to consult with a physician. Web-based EMR provides easy access to patient charts, labs, and pharmacies. Two-way fully duplex webbased video conferencing system. Remote desktop login assistance is available at the physician’s finger tip.
  16. 16. 16 Crimson Supporting Total Value of Care Managing Performance Across Three Dimensions Measuring Total Value of Care 1 2 1 Care Sustainability Care Outcomes Ensuring Financial and Operational Health to Support Reinvestment and Growth Improving Quality, Reliability, and Experience of Care Provided Key Metrics: Key Metrics: • Contribution margin • Same-site 30-day readmissions • Adjusted length of stay • Hospital-acquired conditions • Cost per case • Complication of care rates • Surgical revenue, percentage of operating revenue • Severity-adjusted mortality 3 2 ©2012 THE ADVISORY BOARD COMPANY Value Potential 3 Total Value of Care Care Management Managing Population Health and Preventing Chronic Disease Key Metrics: • At-risk population measures (e.g. diabetes, heart failure, hypertension, COPE, etc) • Ambulatory-sensitive measures • Preventive care measures and screening
  17. 17. HBS Health Industry Alumni Conference March 14, 2012 Health Care 2020 ©2012 THE ADVISORY BOARD COMPANY Emerging Innovations in the Health Care Payment and Delivery Landscape