1 HEALTH CARE REFORM – Changes in Delivery Systems Kenneth W. Kizer, MD, MPH Alaska State Hospital and Nursing Home Association Fairbanks, AK September 8, 2010

2 Presentation Objective To consider how PPACA and other change drivers are likely to affect health care delivery systems.

3 Why do we need to change?

4 Drivers of Delivery System Change: The Confluence of Forces 1. 1.Increased demand for services a. a.Population growth and aging b. b.Increased prevalence of chronic diseases c. c.Increased ability to treat conditions 1) 1)Advances in the biomedical sciences 2) 2)New technologies d. d.Direct to consumer advertising e. e.Medical liability concerns f. f.Our “consumptive society” and the “medicalization of everything” 2. 2.Disproportionate growth of health care costs and increasing adverse consequences for other sectors 3. 3.Widespread recognition of quality and safety problems 4. 4.Health care personnel shortages

5 Drivers of Delivery System Change: The Confluence of Forces 5. 5.Health Information Technology a. a.ARRA/HITECH, EHRs and achieving “meaningful use” b. b.Health information exchanges c. c.ICD-10 conversion d. d.Health information privacy and security issues e. e.Telemedicine 6. 6.Changing patient expectations and demands 7. 7.Need to modernize facilities 8. 8.Health care reform legislation

6 Ways PPACA Will Drive Delivery System Change in General Ways PPACA Will Drive Delivery System Change in General 1. 1.Strategies to improve the quality of care by a. a.Value based purchasing b. b.Increasing public reporting c. c.Improving coordination and continuity of care 2. 2.Strategies to control the rate of increase of health care expenditures by a. a.Reducing waste, fraud and abuse b. b.Health insurance reforms c. c.Increasing wellness/disease prevention and chronic disease management services d. d.Promoting primary care e. e.Removing barriers to disease prevention interventions and early diagnosis and treatment 3. 3.Strategies to support the needed workforce

7 Some Ways PPACA Will Drive Delivery System Change   Expanded insurance coverage, standardization of benefits and insurance reforms should remove some perversities of the system related to payment   Increased performance reporting on processes of care, outcomes and hospital-acquired conditions   Payment changes, and especially the expansion of Medicaid and the greater role of the federal government as a payer and the emphasis on value-based purchasing   Increased support for home and community-based services and supports   Increased support for primary care and practice-based population health and development of the primary care and public health workforce   Increased payment to PCPs, certified nurse midwives and nurse managed health clinics

8 Some Ways PPACA Will Drive Delivery System Change (con’t)   Development of a national strategy to improve quality   Establishment of the CMS Innovation Center to promote more cost-effective care delivery   Support for health care delivery system research, quality improvement assistance, PCMH, medication management, regionalization of emergency care, trauma care systems, shared decision making and rural physicians   Establishing a Medicare hospital readmissions reduction program and reduced payment for “excessive” readmissions   Establishing a community-based care transition program   Support for wellness and disease prevention services   Financial disclosure requirement for physicians   Establishing a Patient-Centered Outcomes Research Institute and Research Trust Fund

9 Some Ways PPACA Will Drive Delivery System Change (con’t)   Improved access to innovative therapies   No Medicaid federal payment for hospital acquired conditions   Increased coordination of coverage and payment for dual eligible persons   Support for comparative effectiveness research   Medical malpractice demonstration project grants   Supporting a Medicare Independence at Home demonstration project for high need Medicare beneficiaries

10 Operationalization of the PPACA Strategies Will Require Operationalization of the PPACA Strategies Will Require 1. 1.Increased collaboration among different types of service providers and integration of services 2. 2.Alignment of hospitals and medical staffs based on a clear and shared vision and values and a high degree of trust 3. 3.A supporting IT, HR, finance, decision making and other infrastructure 4. 4.Strong leadership

11 Private sector health care in Alaska has not been impacted by previous payment system changes the way it has been elsewhere in the U.S. So, what’s different now?

12 PANEL…