1. State Level Change Introducing P4P NIATx/SI Interest Circle Call June 10, 2010

2. Context for Change Health Care Arena – Addiction is a HEALTH problem: Part of mainstream healthcare Part of Health Care Reform Chronic not acute condition: As a chronic disease, purchasers will need to modify their contract approaches, funding mechanism, and expectations Treatment programs will need to change from acute to chronic care design and service delivery models

3. Changes in Funding/Contracting New financing and funding models for healthcare and SA treatment: Fee for service, grant and contract funding do not reward performance and results Bundled care, networks and collaboratives Pay for for results Models: Pay for Performance (P4P) Accountable Care Organizations (ACO’s) Episode-based Funding

5. Operational Definitions Performance “Accomplishment of a given task measured against standards …” (Business Dictionary. com) “The way in which somebody does a job, judged by its effectiveness; often used before a noun as in ‘performance-related pay.’” (Encarta Encyclopedia) For healthcare – related to expected results produced by effective care and management practices; generally treatment processes or proximal outcomes that are not beyond the provider’s control.

6. Operational Definitions Performance Management Uses data to: Assess system and program strengths and weaknesses Analyze and interpret provider performance on key areas of interest/importance Produce data-based reports to understand and monitor system and individual program performance

7. Operational Definitions Performance Management (Con’t) Uses data to: Target quality improvement efforts Provide regular feedback to individual providers to help them understand their own performance and to compare it with statewide standards and other similar programs Prepare public scorecards on selected measures

8. Operational Definitions Performance-based Contracting Includes data based performance expectations and individual program contracts : Select measures applicable to all programs or specific modalities or individual programs (for specialized types of services, or to correct specific program deficiencies) Use data to gauge program performance, identify successes, and determine when technical assistance is needed to improve performance.

9. Operational Definitions Pay for Performance Contracting “A remuneration arrangement in which a portion of the payment is based on performance assessed against a defined measure. Another component of the remuneration is independent of the amount at risk.” (Congressional Research Service) Applied to a few very carefully selected measures or targets that are of particular importance at a particular time for service improvement, or to meet a particularly critical need or goal.

10. Purpose of P4P Incentive programs promote performance and quality improvement Tools to encourage change and reward results P4P is not a magic bullet – it is one of a number of activities that can work to improve healthcare quality and change the way it is delivered and financed.

11. Promote Collaboration Not Competition Design P4P system to require collaboration among providers, including continuity of care i.e., movement from one level of care or one setting to another as well as continuing care Include rewards for collaboration with other providers in across treatment systems

12. Contact Information Jack Kemp jbkconsult@comcast.net