1. The Patient-Centered Medical Home Neighborhood March 29, 2014 Jean Malouin, M.D., M.P.H. Medical Director, Value Partnerships

2. Agenda Defining the PCMH-N concept BCBSM PGIP Overview The BCBSM PCMH Neighbor Opportunities for Collaboration BCBSM Specialist Fee Uplifts 2

3. Defining the PCMH-N Concept 3

4. 4 Joint Principles of the Patient-Centered Medical Home (AAFP, AAP, ACP, AOA) Personal physician Physician directed medical team Whole-person orientation Integrated, coordinated care Quality and safety as hallmarks Enhanced access Payment structure for added patient value

5. PCMH-N: American College of Physicians (2010) The ACP developed a position paper on the PCMH-N concept: “The Patient-Centered Medical Home Neighbor: The Interface of the Patient-Centered Medical Home with Specialty/Subspecialty Practices” Highlights the important role of specialty and subspecialty practices within the PCMH model Defines the PCMH-N concept Provides a framework to categorize interactions between PCMH and PCMH-N practices Offers principles for development of care coordination agreements Recognizes the importance of financial and non-financial incentives Introduces the concept of a PCMH-N recognition process 5

6. ACP PCMH-N: Processes of care A PCMH-N practice engages in processes that: – Ensure effective communication, coordination and integration with PCMH practices – Ensure appropriate and timely consultations and referrals – Ensure the efficient, appropriate and effective flow of information – Effectively guides determination of responsibility in co-management situations – Support patient-centered care, enhanced access, and high quality care – Support the PCMH practice as the provider of whole person primary care and as having overall responsibility for ensuring the coordination/integration of care 6

7. BCBSM PGIP Overview 7

8. What is the Physician Group Incentive Program? BCBSM partners with Physician Organizations (POs) to achieve a high performing health care system in Michigan The Physician Group Incentive Program (PGIP) is moving from a fee-for- service to a fee-for-value approach PGIP offers rewards to: – POs to assist with infrastructure improvement and practice transformation – Practitioners through fee-for-value-based fee uplifts Increasingly, a portion of professional reimbursement is tied to rewarding specialists for: – Supporting the PCMH model as PCMH-Neighbors – Collaborating with their community of caregivers to optimize use, efficiency and quality in their shared patient populations 8

9. BCBSM’s Award Winning Value Partnerships Programs Moving from a Fee for Service to Fee For Value Environment Hospitals Hospital Incentive Program Collaborative Quality Initiatives (CQIs) 15 hospital & 5 professional CQIs addressing surgical and medical care All 15 hospital CQIs analyze the care given to nearly 200,000 MI patients annually 75 Michigan hospitals participate in at least one CQI 92% of Michigan hospitals participate in all the CQIs for which they are eligible Four of our longest running CQIs have saved over $232M in statewide savings and over $70M for the Blues Physicians Physician Group Incentive Program Hospital Pay-for-Performance Program Rewards up to 5% based on quality, efficiency, and participation in selected CQIs Value-based Contracting (VBK) Ties hospital payment to population-based performance Provides funding for population management infrastructure development 30 Initiatives 12 PCMH 7 Performance-based 8 Participation-based 3 OSC Approx 18,000 physicians participate 65% of MI PCP’s participate in PGIP $100M annual reward pool $33.7M 2014 projected specialist fee uplift Affecting the lives of 1.5M Blues members & Michiganders statewide PCMH Designation Program 1,243 practices – up 20% over 2012 Over 3,600 designated physicians 2 out of every 3 PGIP PCPs are BCBSM PCMH-Designated $33M in 2012 PCMH related fee uplifts for PCPs Value Partnerships programs have been recognized by Blue Cross Blue Shield Association (BCBSA), Michigan Cancer Consortium (MCC), National Business Coalition on Health (NBCH), URAC, among others. Key Collaborative Relationships: Center for Healthcare Research and Transformation (CHRT) Michigan Health & Hospital Assn: Keystone Center for Patient Safety & Quality Michigan Primary Care Transformation Demonstration (MiPCT) Michigan Quality Improvement Consortium (MQIC) Blue Distinction Centers Program National designation for high quality & cost-efficient hospitals for Bariatric Surgery, Cardiac Care, Complex and Rare Cancers, Knee/Hip Surgery, Spine Surgery, and Transplant.

10. 2004 2005 2006 2007 2008 2009 2010 20112012 2013 Physician Group Incentive Program Chronic Care Model  Physician Organizations have the structure and technical expertise to create highly functioning systems of care  Design and execute programs in a customized and collaborative manner  Measure performance at the population level and reward improvement as well as absolute performance: initial focus on generic drug rate and building patient registries  Launch PCMH and quality and use Initiatives  Support building of PCMH infrastructure  In addition to generic drug rate, measure preventive and evidence-based care, preventable emergency department use, high and low-tech imaging, inpatient use  Include specialists involved in chronic care  Build PCMH-Neighbor model: expand PGIP to include specialists  Catalyze building of Organized Systems of Care that assume responsibility and accountability for managing the PCP- attributed population of patients across all locations of care Patient Centered Medical Homes Primary Care Transformation OSCs Organized Systems of Care 1 Physician Group Incentive Program: catalyzing health system transformation in partnership with providers

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12. PCMH designated physicians steadily increase each year PCMH Designations 4 Red denotes PCMH Designated Primary Care Physicians (PCPs) Green denotes PCMH Designated Practice Units (PUs)

13. 5 Health Services Research, July 5, 2013, Paustian, et al

14. 6 BCBSM Department of Clinical Epidemiology and Biostatistics, June 2013

15. Physician participation in PGIP doubled in the past three years, driven largely by the expansion to specialists 2 * *Source data used to identify a PCP versus a specialist was changed, resulting in a more accurate depiction of PGIP composition.  Today, over 70 percent of BCBSM’s members are attributed to a PGIP primary care physician (PCP), accounting for approximately 85 percent of costs  Specialists in PGIP cover 55 percent of BCBSM’s book of business, with all physician specialties participating  In 2014, specialties eligible for value-based fee uplifts will increase from seven to 24  $155 million in savings were associated with PCMH over a three year period, through outcomes such as a 20 percent reduction in ambulatory care sensitive inpatient admissions PGIP physicians

16. Primary Care Physician(s) Complex Care Manager Moderate Care Manager Major Specialists (Cardiology, Orthopedics, etc.) Other Specialists Hospitals Other Facility Providers Community Services Health Care Providers Examples of Quality Improvement and Cost Reduction Opportunities *Derived from Harold Miller’s depiction of ACO models PCP Attributed Patients PCMH Neighbors PCMH partnerships are foundational for building Organized Systems of Care to improve quality and reduce cost Care Partners Shared Patient Population: Shared Information Systems and Care Processes Patient-Centered Medical Home Coordinated health and social services support Improved management of complex patients Improved outcomes and efficiency for major specialties Reduction in preventable emergency room visits and admissions Appropriate use of testing and referrals Prevention and early diagnosis Self-management support 7

17. 17 PCMH PCMH-N Other caregivers and community services Hospitals and other facilities Patient Population (PCP-attributed) What is an Organized System of Care?

18. OSC – Michigan Landscape As of January 2014, there are 39 OSCs in Michigan, spanning 16 counties. Together, these OSCs account for 4,300 primary care physicians, 9,500 specialists and 1.3 million patients. The payment model currently provides incentives to support capability development, with an underlying fee-for-value infrastructure. This model will continue to evolve over time to support comprehensive population management. 18

19. Ongoing OSC Development Organizations are continuing to implement OSC capabilities in the following areas: – Integrated patient registry — Creating a system-wide electronic database of clinical data on patients – Integrated performance reporting — Providing current, clinically relevant health care information on the entire population of OSC patients – Integration of care processes — Developing processes to communicate, coordinate and collaborate to achieve clinical integration at the OSC level 19

20. The BCBSM PCMH Neighborhood 20

21. PCMH-Neighbor + Organized Systems of Care (2012 - present) “BUILDING CONNECTIVITY TO IMPROVE POPULATION HEALTH” 21 Hospitals PGIP participating PCPs PGIP participating Specialists

22. BCBSM PCMH-N Overview BCBSM recognizes the extremely valuable role that specialist physicians and their care teams play in creating the ideal patient experience. To support specialists in building PCMH capabilities, BCBSM has expanded its Patient-Centered Medical Home interpretive guidelines to incorporate the Patient Centered Medical Home – Neighborhood (PCMH-N). The BCBSM PCMH-N program supports implementation of capabilities that will further the development of a highly functioning OSC by enabling specialists and sub-specialists, including behavioral health providers, to partner with primary care physicians to help ensure good communication and care coordination. 22

23. Patient Centered Medical Home – Neighbor (PCMH-N) Recognizes the important role of specialty practices within the PCMH model PCMH-N principles include: – Providing appropriate and timely consultations and referrals that complement and advance the aims of the PCMH practice(s) – Establishing shared responsibility for relevant types of clinical interactions – Supporting patient-centered high-quality safe care and enhanced access – Recognizing the PCMH practice as the source of the patient's primary care – Understanding that the PCMH practice has overall responsibility for coordination and integration of care provided to the patient 23

24. The Neighborhood and the Specialists Examples within the care delivery system where PCMH – N capabilities might be applicable: – Preconsultation exchange—intended to expedite/prioritize care, or clarify need for a referral – Formal consultation—to deal with a discrete question/procedure – Co-management: Co-management with Shared Management for the disease Co-management with Principal care for the disease Co-management with Principal care of the patient for a consuming illness for a limited period Transfer of patient to specialty PCMH for the entirety of care. 24

25. What does your medical neighborhood look like? 25

26. Opportunities for Collaboration COMMUNICATION! Development of common IT platforms – Health Information Exchange – Electronic Health Record Transmission of Admission, Transfer, Discharge information Standardization of referral process - clear expectations for all parties Test tracking Access Optimization across primary and specialty care Optimization of clinical care – Standardization of clinical guidelines – Standardization of PCP follow up (oncology surveillance, etc.) – Appropriateness of tests and procedures – Collaboration on process for closing gaps in care 26

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28. Choosing Wisely® Choosing Wisely® is an ABIM Foundation initiative focused on specialty-specific evidence-based recommendations around topics to help patients and physicians make wise decisions about the most appropriate care. http://www.choosingwisely.org/doctor-patient-lists/ 28

30. PGIP Specialist Fee Uplifts 30

31. Specialist Fee Uplifts: Key Points Fee uplifts are the primary method for rewarding specialists The fee uplift program rewards specialists who actively collaborate with PCPs and their PO leadership to: – Create improved systems and care processes – Implement evidence-based care – Promote efficient and effective care The measures BCBSM uses to select which specialists receive fee uplifts are population-based and reward specialists who serve patient populations with higher overall performance Eligibility for fee uplifts is determined on an annual basis with an effective date of February 31

32. Specialist Fee Uplifts: Key Points (continued) Practitioners must be on the PGIP list by July 1 of the prior year to be eligible for fee uplifts Fee uplifts are applied to most professional codes, excluding ambulance, durable medical equipment, prosthetics and orthotics, anesthesia, immunizations, hearing, lab, vision, dental and most injections Fee uplifts are applied only to PPO/Traditional Commercial claims 32

33. Specialist Fee Uplifts Goals and Principles Take steps towards transforming reimbursement from traditional fee-for- service to fee-for-value Accelerate specialist engagement in PGIP Encourage conversations and collaboration between specialists and primary care practitioners (PCPs) Support and promote organized systems of care Accelerate the adoption of PCMH- Neighbor principles and agreements Focus on communities of caregivers with shared responsibility for managing a patient population Assess and improve population-based metrics of performance 33

34. Determining Which Practices Receive a Performance-Based Fee Uplift Eligible practices must be nominated by their member PO and, if applicable, another PO – Physician organizations nominate practices based on written and publicly available criteria and founded upon Patient-Centered Medical Home- Neighbor principles – Nomination is a necessary, but not sufficient, factor in receiving the uplift The practitioner must be signed up with PGIP by July 1 (prior to the fee uplift year) BCBSM selects nominated practices based on one or more population- based metrics of cost, quality, utilization and/or efficiency In 2014, BCBSM selected the top two-thirds of nominated, non- pediatric specialty practices plus all nominated pediatric specialty practices to receive a fee uplift 34

35. Eligibility for Specialist Fee Uplifts – 2014 A specialist must : – Be a member of a PGIP PO – Be listed with PGIP as a specialty type eligible for an uplift (based on their primary credentialed specialty or “functioning as” specialty) as of August 1, 2013 (i.e., the snapshot from the Practitioner Alignment Tool) – Be nominated by the member PO – Be nominated by the principal partner PO (if applicable) – Have a signed Primary Care-Specialist agreement with the PO – Have a signed Primary Care-Specialist agreement with the principal partner PO (if applicable) within the past 2 years 35

36. Specialties Eligible for Fee Uplifts 20112012201320142015 Oncology Cardiology Oncology Cardiology Emergency Medicine Gastroenterology Nephrology Obstetrics/Gynecology Orthopedics Oncology Cardiology Emergency Medicine Gastroenterology Nephrology Obstetrics/Gynecology Orthopedics Allergy Chiropractic Critical Care Endocrinology Infectious Disease Neonatal Care Neurology Otolaryngology Pain Management Podiatry Psychiatry Psychology Pulmonology Physical Medicine Sports Medicine Rheumatology Urology Oncology Cardiology Emergency Medicine Gastroenterology Nephrology Obstetrics/Gynecology Orthopedics Allergy Chiropractic Critical Care Endocrinology Infectious Disease Neonatal Care Neurology Otolaryngology Pain Management Podiatry Psychiatry Psychology Pulmonology Physical Medicine Sports Medicine Rheumatology Urology PLUS: Most remaining specialties 36

37. Specialist Fee Uplift Metrics – 2014 Metrics Used for Selection – BCBSM scored and ranked practices based on one or more metrics of quality, utilization, efficiency and/or cost performance – BCBSM has specialty-specific metrics for Cardiology, Emergency Medicine, Endocrinology, Gastroenterology, Nephrology, Ob/GYN, Oncology, Ortho, Otolaryngology, Pulmonology Most metrics measure population-level performance, not practice unit- specific performance BCBSM develops comprehensive, specialty-specific metrics based on a thorough review of the literature and evidence and in consultation with subject matter experts – For the 14 specialty types that have yet to be put through a metric vetting process, population-level cost of care per member per month is the only performance metric 37

38. 2014 Specialist Fee Uplift Results  69 percent of specialists in PGIP (8,348) were eligible for a specialist fee uplift +*  63 percent of the eligible specialists (5,300) were selected for a fee uplift ranging from 2 to 15 percent on most of their professional procedure codes 5056 practitioners selected for performance-based fee uplifts 215 physicians selected for a fee uplift based on participation in oncology programs – 175 physicians participated in PDCM-Oncology (a 5 percent fee uplift added to any other fee uplifts received) – 40 physicians received a 5 percent fee uplift for participation in an oncology quality improvement program 226 physicians selected for a 2 percent CQI recognition fee uplift 38 + Based on 8/1/2013 PGIP list containing 12,042 specialist practitioners * Count includes 34 physicians awarded CQI recognition and 7 oncologists that were not in PGIP as of 8/1/2013

39. 2014 Specialist Fee Uplifts – Tools and Resources Available on the PGIP Collaboration Site/Uplifts Tab Specialty-specific fact sheets Specialty-specific slide decks (new!) FAQs Letter from David Share to individual practitioners receiving uplifts Available on the PGIP Collaboration Site/Analytics Tab Training module – Specialist Fee Uplift Webinar (Feb. 2014) Coming Soon! Specialty-specific, recorded webinars on specialist fee uplifts Slide deck on identifying and addressing PMPM cost opportunities

40. This document, unique for each specialty type, describes the specialty- specific metrics and the overall selection methodology

41. Thank You! 41