Transcript Slide 1

COORDINATED CARE ORGANIZATIONS
March 18, 2013
Presentation to Allied Hospital Associations’
Accounting & Financial Specialists
OREGON’S MEDICAID MAKEUP
 87% managed care penetration
 ~645,000 lives covered
 “Expansion population” (non categorical eligibles)
• ~70,000 lives, by lottery
• Paid 100% by hospital provider tax
 Oregon has 58 acute care hospitals
• 32 are small and rural
• 26 large ‘DRG’ hospitals
• 1 teaching university
• 7 health care systems
• All but 2 hospitals are tax-exempt
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Oregon Association of Hospitals & Health Systems
TRANSFORMATION DID NOT HAPPEN
OVERNIGHT
“Transformation” passed took…
• 3 Bills over 4 years through 2 Governor’s
• Thousands of hours of stakeholder
meetings, workgroups and committees
Medicaid’s the first stop on this train,
but not last
ACA Medicaid expansion a forgone
conclusion in Oregon
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Oregon Association of Hospitals & Health Systems
Oregon’s new Coordinated Care
Organizations will:
 Cover Medicaid patients (and other populations)
 Utilize ‘global budget’ payment model
 Integrate physical, behavioral, oral health, addictions
 May include dual-eligible individuals
(Medicare/Medicaid)- It’s the patient’s choice
 Could end cost-based Medicaid reimbursement for
rural hospitals starting in July 2014
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CCO HALLMARKS
 Shared governance with consumer representation
 Integrated funding
 Patient-centered primary care homes
 New payment models, moves away from fee-forservice
 Use EHR and health information exchange
 Non-traditional health care workers
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WHO MAY FORM A CCO?
Medicaid Managed Care Plans (physical, oral,
or behavioral health MCOs)
Commercial health plans
Hospitals & provider groups
Counties
Combinations of these entities
Any entity, no restrictions
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WHAT CCOS MEAN FOR HOSPITALS
Targets a reduction in hospital utilization
Restriction in the growth of cost inflation
Forge community partnerships
Adoption of EHR & health data exchange
Potential for hospitals to be involved in
governance, or just be contractors
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Oregon Association of Hospitals & Health Systems
CCOS: NOT JUST FOR MEDICAID ANYMORE!
 Oregon won a CMS State Innovation Model
award
Will get up to $45M over next 42 months
Goal: Expand the CCO model to Medicare
and private plans covering state employees
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Oregon Association of Hospitals & Health Systems
CCO Coverage: August 1
CCO Coverage: Sept. 1
CCO Coverage: Nov. 1
HOW’S IT DIFFERENT THAN FORMER MCO’S
 Financial risk borne by CCO and the providers on
its governance board, no longer borne by state
 Financial and clinical integration of physical,
behavioral, oral health
 Community-level accountability
 Global budget: Fixed rate of growth (~4%)*
 New flexibility within budget to deliver outcomes
 Moves remaining FFS patients to coordinated care
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Oregon Association of Hospitals & Health Systems
THE OPPORTUNITIES AND THE RISKS
 Opportunities
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Create a true health care “system” vs. silos of care
Temper significant cost increases/cost shift
Drive better outcomes for patients
Additional federal funding
 Risks
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Too much too fast. (Medicare + Public employees)
Could destabilize access & care delivery
Hospitals are central focus – do less w/ less $
Unrealistic expectations around cost savings
No Long-term, sustainable funding for Medicaid
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Oregon Association of Hospitals & Health Systems
FUNDING FOR CCOS & MEDICAID
State is counting on $238 M “savings” from
CCOs within the first year
1115 waiver agreement with CMS and
Oregon = $1.9B/5yrs with strings attached
• Must meet cost inflation and spending caps
each year
• Quality metrics must be met
Artificially masks the underlying funding gap
for the state’s Medicaid program
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Oregon Association of Hospitals & Health Systems
CCOs: VISION VERSUS REALITY
EARLY UNFORESEEN CONSEQUENCES
 Governance: only those who can put up adequate
reserves are included at the table (must “buy” your
seat)
 Contracting: lack of access to adequate information for
fair contracting
 Reducing rates prior to any substantive clinical delivery
reforms
 No reinsurance by the state, CCO assumes all risk
 Global budget: Little clarity on inner financial workings
& who retains ‘savings’
 No real payment reform between CCO and providersstill paid by the widget
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Oregon Association of Hospitals & Health Systems
BURNING QUESTIONS
 Will CCOs result in better health care outcomes
for Medicaid patients?
 Will CCOs result in true clinical integration?
 What about eventual inclusion of public
employees and long-term care services?
 Will ‘carve out’ of long term care harm ability to
manage care and manage costs?
 Will providers survive under a global budget
model?
 Will CCOs be financially sustainable?
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Oregon Association of Hospitals & Health Systems
“I don’t know whether what my hospital does
today it will do in five years. If that scares you,
you need to get out now.”
“CCO’s have
potential for
disruptive
innovation”
“I feel
“The partnerships
pressured and
push everyone to creatively
challenged.
address problems together
I need more
instead of looking at singular
time.”
solutions that benefit one
entity.”
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Thank You
Robin Moody, [email protected]
503-568-9291
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