A PHYSICIANS INSURANCE PUBLICATION THE SUMMER 2014 PHYINS.COM Evolving Practice Models 4 Taking Aim: Northwest Approaches to the Next Generation of Care 6 Unlocking Value with Clinical Integration: Independence through Interdependence 10 Taking Accountability for Population Health IN 1994, I was a young health Medicare Advantage contracts, we EDITORIAL STAFF care executive excited about health took some of our monthly capitation PUBLISHER care reform. Things didn’t work out like payments and added case managers Mary-Lou Misrahy SENIOR EDITOR many of us hoped. This go-round, I am and other patient support staff to reduce David Kinard both excited and apprehensive about hospitalizations and ER visits, saving MANAGING EDITOR health care reform and alternative money and enhancing patients’ lives. Kirstin Williams EDITOR delivery systems. Providers cannot fund this type of Elaine Riordan innovation out of their existing fee-for- CONTRIBUTING EDITORS Jeff Ellis, JD The Polyclinic has participated service payments. Ray Herschman enthusiastically in health care Judit Olah, PhD innovation. Our efforts have included Lead, but don’t get too far ahead of the Greg O’Barr, M.Ed Martie Ross, JD full risk capitation, both commercial and market. There is a lot of rhetoric about Phyllis Simpson Sherard, PhD Medicare Advantage, incentive contracts moving from pay-for-volume to pay- CONTRIBUTING EDITORS—LEGAL Catherine Walberg, JD for-value, but the vast majority of our based on generic prescribing, ER use Kari Adams rates, hospital admission rates, etc. We payments are still for volume. Emphasize ART DIRECTOR were Washington State’s first Medicare “virtuous volume,” e.g., childhood Jerry Kopec, Mortise+Tenon immunizations, preventive care, and ADMINISTRATIVE SUPPORT ACO and first commercial ACO. We have Laura Brosten, Bonny McFarland participated in state collaboratives on regular care for chronic conditions. Nancy Reithaar diabetes, heart disease, and medical homes, and we have studied the efforts Follow the value equation, but recognize EXECUTIVE MANAGEMENT GROUP of others in the region and the nation. whether the market will reward increasing PRESIDENT AND CHIEF EXECUTIVE OFFICER What have we learned? the numerator or decreasing the Mary-Lou Misrahy denominator, or both: EXECUTIVE VICE PRESIDENT, CHIEF FINANCIAL OFFICER AND TREASURER Be careful how much you spend while Rod Pierson building new solutions. Elaborate SENIOR VICE PRESIDENT AND CHIEF INFORMATION OFFICER Quality + Satisfaction Leslie Mallonee organizational structures are less likely Value = to produce meaningful change than Total Cost of Care VICE PRESIDENT, GENERAL COUNSEL Catherine Walberg, JD programs that tighten the connection SENIOR VICE PRESIDENT, UNDERWRITING between patients and their providers. Rick Nauman Information technology systems can SENIOR VICE PRESIDENT, Total Cost Utilization x HUMAN RESOURCES AND ADMINISTRATION be an important element of improved of Care = Price Alison Talbot coordination of care, but they are only a tool. Without change in work processes BOARD OF DIRECTORS and incentives and accountability, We need to do this. If we can’t make Brian P. Wicks, MD, Chairman improvement is unlikely. a convincing case that our efforts will Ralph A. Rossi, MD, Vice Chairman reduce health care costs and deliver those Aparna Ananth, MD Lloyd David Don’t fall in love with models. Apply savings, then payers and purchasers will Jennifer Hanscom resources only where they can have simply push down our prices. John R. Huddlestone, MD real impact. Medical homes and case Chi-Dooh “Skip” Li, JD David McClellan, MD managers make great sense for the We don’t have much time. Timothy L. Melhorn, MD frail, elderly, and patients with multiple John Pasqualetto chronic conditions, but they are a waste Sheila Rege, MD David A. Russian, MD of resources for healthy 35-year-olds. Walter Skowronski Leslie A. Struxness, MD Josephine Young, MD Physician leadership is critical. Every organization may say it is “physician-led.” Lloyd David READ PHYSICIANS REPORT ONLINE www.phyins.com/Summer2014 The proof will be in whether physicians CEO CONTACT PHYSICIANS REPORT feel like they are leading. The Polyclinic [email protected] HOME OFFICE: Payers must create funding to support Seattle, WA innovation by providers. In our full-risk Copyright 2014 Physicians Insurance A Mutual Company A PHYSICIANS INSURANCE PUBLICATION FEATURES 6 Unlocking Value with Clinical Integration: Independence Through Interdependence What exactly is a CIN and how does one work? 10 Taking Accountability for Population Health: The Role of Data Using data to gain more control. 12 Medical Neighborhoods Are Transforming Care Delivery in Rural Settings 4 Taking Aim: Northwest Collaborating to solve the Approaches to the Next challenge of fragmented care. Generation of Care It is widely understood that the U.S. health system is the most costly in the world. Read how some Northwest facilities are organizing themselves to improve care and rein in costs for the next era. ADDITIONAL FEATURES CME RISK MANAGEMENT MEMBER NEWS 16 Why the Coach 22 New: The 25 Taking Care: 26 Member Spotlight: Approach Works Coach Approach Your Peers Speak GreenField Health Up on Difficult Topics 20 Income Protection 23 Online and 26 New Members — Tools Specialty-specific Welcome! 24 Q&A with Mary 28 Trial Results McWilliams, Executive Director of the Washington GOVT AFFAIRS Health Alliance 30 Upcoming Election News: Is There SEND FEEDBACK a Doctor in the House? Tell us more about what you would like to see in upcoming issues. E-mail us at [email protected]. 4 Northwest Approaches to the Next Generation of Care Taking Aim In 2008, when Don Berwick first coined the notion of a Triple Aim, little did the general public understand — or even most health care professionals — the impact this simple model would have on the U.S. health care system. Today, it is widely understood that the U.S. health system is the most costly in the world, accounting for 17% of the country’s gross domestic product with estimates it will reach 20% by the end of this decade.1 5 THE PHYSICIANS REPORT | SUMMER 2014 THE PHYSICIANS REPORT Change and improvement processes are rampant, they both see the emergency department as a leading and while Berwick’s vision of impacting care quality, indicator of how this new model can work. “In Yakima, population health, and reducing costs still remains there is a culture of first going to the emergency room elusive to most, the Northwest is home to several for care,” notes Spiegel. “In a rural population like ours, organizations aiming in the right direction. culturally, the ED is seen as a place to get primary care. The opportunity for us is not only to reduce the costs of One organization in Vancouver, Washington, is focusing care in the ED, but also to educate patients and change on physician-patient relationships to make a difference. their behavior in how they access care.” One common “We want to create a community solution,” says Duane method being experimented with is the use of urgent Lucas-Roberts, CEO of The Vancouver Clinic, about his care clinics. Physicians at Memorial Hospital, who Northwest Approaches to organization’s approach to developing a clinically integrated participate in SignalHealth, have opened up convenient network (CIN). “Our goal for Columbia IPA [independent care clinics in Yakima, which are less expensive than the Next Generation of Care practice association] is to create a coordinated approach to the ED — in large part due to the staffing of the clinics quality care, and lower costs at the same time. That goal by nurse practitioners who cost less than emergency isn’t anything new, but the way we are organizing ourselves medicine physicians. to achieve it is.” It is easy to notice, as one “The result was a reduction in emergency surveys the region, that as groups organize themselves department visits — from 1,000 to 200 visits.” into CINs, each is doing it DUANE LUCAS-ROBERTS, CEO differently. Continues Lucas- THE VANCOUVER CLINIC Roberts, “We see ourselves as just a part of the overall solution. The hospitals are the other part. The patient plays Lucas-Roberts recalls his own emergency department a role, too. But we’re organizing ourselves — starting with challenges while working in Walla Walla, Washington. the physician and patient relationship. That’s where care “Our population was a full-risk Medicaid group of about really starts and it’s that ongoing relationship that will have 2,000 patient lives, most of whom were kids.” According the most impact.” to Lucas-Roberts, this population was running about 1,000 ED patient visits per 1,000 patients per year — While The Vancouver Clinic develops their physician-centric about five times higher than the commercially insured solution, just four hours away efforts are under way at population. “We knew we had to change patient behaviors Yakima Valley Memorial Hospital (YVMH), where the hospital but that ours needed to change first.” The clinic set up is leading a community-wide charge to create a CIN. But a system where the emergency department was required whereas The Vancouver Clinic efforts pivot around the to contact the primary care physician before seeing the primary care physician and patient relationship, YVMH saw patient except in emergent cases. The primary care the value of the hospital leading the charge and financing physician would consult with the patient and either see the start-up of Signal Health, LLC. the patient in the ED, or schedule an office visit. “The result was a reduction in ED visits — from 1,000 to 200 Headed by Dr. Richard Spiegel, Signal Health has recruited visits per 1,000 patients per year,” notes Lucas-Roberts. more than 300 physicians, which include all of the hospital’s employed physicians and others (about three-quarters of And this is possibly the most compelling and perplexing the total according to Spiegel) that are independent.