Sentara Healthcare`s David Maizel, MD, on managing business and

Transcription

FALL 2011
A publication of HFMA Learning Solutions, Inc.
A subsidiary of the Healthcare Financial Management Association
Sentara Healthcare’s
David Maizel, MD,
on managing business
and clinical risks
FOR
>>Retooling
VALUE
>>AVOIDING PATIENT HARM
>>NAVIGATING THE REGULATORY Maze
>>USING TECHNOLOGY TO IMPROVE DECISION MAKING
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This Is Not a Drill
There’s an old morality puzzle: An art museum is on
fire, and the firemen can make only one trip into the
blazing building. They must choose what to save: a few
of the museum’s most valued paintings or a stranded
elderly woman.
Of course, the firemen should save the woman. Yet,
many people, while commending the firemen’s decision,
would also grieve the loss of the art. Anyone who has
ever been moved by a Van Gogh or a Warhol understands the intrinsic value that art evokes—not only to
individuals but to the community as a whole.
Wasn’t there some way to save the woman and
the art? If museum directors had planned ahead
and instituted precautions, could the fire have been
prevented or at least contained?
On the surface, a healthcare organization and
a museum have little in common. Yet each has
obligations to individual patients/patrons and to the
community at large. If a hospital or physician practice
burns down—or folds for financial reasons—the
community would lose a valued asset: a source of
jobs, community education, and local pride.
As we all know, the healthcare industry is in the
midst of cataclysmic change: cuts to Medicare and
Medicaid, the transition to value-based payment,
record-breaking mergers and acquisitions, and on
and on.
In other words, fireballs are flying from every
direction.
One reaction is to cite the futility of planning
because so much is in flux. This issue of Leadership
is about the reverse philosophy: To manage a raging
fire, you need to erect the necessary safeguards
while also investing in a future vision, forming
needed partnerships, empowering staff, and tracking
performance.
Fireballs are flying
from every direction…
A commitment to value—improving quality and
reducing costs—is a common risk strategy among the
providers in this issue. For example, rural health system Winona Health has merged with local physicians
and redesigned its service lines—reducing its 30-day
readmission rate to just 2.2 percent, compared to the
18 percent national average (page 16).
Another example: Sentara Williamsburg Medical
Center has not had a single ventilator-associated
pneumonia incident in more than seven years (page 22)
On the outpatient side: Consultants in Medical Oncology
and Hematology (CMOH) has helped its patients avoid
more than $6.5 million in hospital and emergency
department charges in 2010 by proactively managing
common symptoms related to cancer treatments and
underlying diseases and conditions (page 24).
The case studies in this issue celebrate the rewards
of planning and persistent follow-through.
“We’re bending the healthcare cost curve by eliminating unnecessary expenditures,” says CMOH’s John
Sprandio, MD. “This is better care for our patients, and
less expensive care.”
The lesson: It is possible in these risky times to keep
patients safe while also securing your organization’s
future (in the same or some altered form). But not
without a well-executed plan.
Managing Business
and Clinical Risks
Sections
6
Retooling for Value
How healthcare organizations are reorganizing,
merging, partnering, and redesigning with the goal
of increasing value. Featured providers: St. Anthony’s
Medical Center, St. John Providence Health System,
St. John Providence Partners in Care, Sentara
Healthcare, and Winona Health.
20
Avoiding Patient Harm
How providers are reducing the likelihood that
patients will suffer unnecessary infections, side
effects, and other harm—while improving clinical
and financial outcomes. Featured providers: Sentara
Healthcare, Consultants in Medical Oncology and
Hematology, St. John Hospital and Medical Center,
and Ascension Health.
36
46
Navigating the Regulatory Maze
How healthcare organizations are addressing
the challenges involved in converting to ICD-10,
complying with HIPAA, and meeting other regulatory
challenges. Featured providers: St. Anthony’s Medical
Center, Halifax Health, Borgess Medical Center, and
Ascension Health.
Using Technology to Improve >
Decision Making
How providers are leveraging EHRs, staffing software,
and other technology to gain the intelligence needed
to formulate the best business and clinical decisions.
Featured providers: St. Anthony’s Medical Center
and Sentara Healthcare.
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LeaDERSHIP HFMA.ORG/leadership
www.hfma.org/leadership
Editorial and Production
Editor-in-Chief Robert Fromberg
Technical Director Todd Nelson
Advertising Representatives and Offices Central
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Southeast
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Production Todd Douglas, Bold Yellow
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Ellen Joyce B. Tarantino
Photography
Front cover: Roberto Alessio
Internal images: Studio/lab
Advertising and Sponsorship Director of Advertising and >
eLearning Sales
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Phone: 708-492-3392 [email protected]
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Advertising Associate
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FALL 2011
West Coast
Thomas R. Reil
JJH&S
Tel: 415-721-0644
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[email protected]
Leadership (ISSN: 1948-089X) >
is published by:
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DRIVING
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MANAGING THE TRANSITION
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6
Retooling
for
Value
Heeding calls for more accountability, four progressive
healthcare organizations are already knee-deep in
colossal change—reorganizing, merging, partnering,
and reengineering—with the goal of differentiating
themselves on quality and cost.
8
A common complaint among leading-edge providers
is the difficulty of keeping one foot in the envisioned
future—where providers are paid based on performance—and one foot in the current fee-for-service
system that still pays primarily on volume. “That is a
challenge for all healthcare organizations right now,”
says David R. Maizel, MD, corporate vice president,
Sentara Healthcare and president of Sentara Medical
Group. “How do we straddle this transition?”
That transition looks even more precarious when
other unknowns are factored in, including how many
additional insured will be added to the ranks, how
much reimbursement will actually decline, and whether
bundled and other performance-based payment
approaches will actually work in the real world.
Yet the providers in this section are managing to keep
a firm footing. While acknowledging the risks, they are
investing time and dollars in major change initiatives
designed to help them achieve patient-centered visions
of higher quality, lower cost, and coordinated, populationbased care.
While each provider in this section has a unique
story to tell, similar strategies are being used by many
(see Common Approaches on this page). One of these
tactics: Building better partnerships—and trust—
between hospitals and physicians, as illustrated in this
first case study about St. Anthony’s Medical Center.
Case Study: Giving Physicians Control >
of A Cardiac Service Line
St. Anthony’s Medical Center, a 767-bed hospital in
suburban St. Louis, has heavily invested in its cardiac
service line in recent years. In 2008, St. Anthony’s
opened a new Heart and Surgical Pavilion—a four-story
“heart hospital within a hospital.” It has also been
steadily expanding its offerings of state-of-the-art
diagnostics and treatments, including minimally
invasive heart surgery and radiofrequency ablation.
>>
Common Approaches
A number of similar reinvention strategies are being
employed by the providers in this section.
>>Building strong partnerships between hospitals
and physicians via employment and comanagement,
contracting arrangements, technology support, and
practice acquisition
>>Establishing mutual trust; two providers stress the
importance of developing guiding principles (e.g., core
values, goals) to help frame hospital-physician partnerships
>>Restructuring service lines to reflect how patients actually
use and view healthcare services—versus traditional
silo-based organizational structures
>>Merging and acquiring to create integrated continuums
of care
>>Redesigning ambulatory and primary care practices
into medical home models
>>Investing in EHRs, HIEs, and other IT to support crosscontinuum collaboration
>>Shifting from a hospital-centric culture to population
health management
But the most innovative change occurred this
past January, when St. Anthony’s partnered with
11 cardiologists to create the Heart Specialty Center.
The newly employed physicians, who now sit on the
hospital management team, are specifically responsible
for the governance, finances, operations, and clinical
care of the medical center’s cardiovascular service
line—which includes interventional radiology and
vascular surgery in addition to cardiac care and
cardiovascular surgery.
In addition, the cardiologists manage a hospitalowned outpatient practice. Because their authority
spans outpatient and inpatient care, they are able to
coordinate the continuum of services for their patients,
from prevention and diagnostics to treatment and
rehabilitation.
David Morton, MD, medical director of the Heart
Specialty Center, says the physicians want their success
to be measured by improved quality scores and complication rates, as well as cost-saving decreases in lengths
of stay and unnecessary readmissions.
Morton initiated the effort that brought the hospital
and physicians together. In his former position as
president of a large cardiology private practice, he had
become frustrated with the competitive and uncooperative relationships between hospitals and physicians.
“We all feel strongly that unless physicians are
involved in running and organizing an entire service
line—both inpatient and outpatient—we will never be
able to attain high clinical quality while also improving
efficiency and lowering costs,” he says.
9
During their search for a hospital partner, Morton
and his fellow physicians were offered—and rejected—
hospital management contracts in which they could
have maintained their private practice. They held out
for an employment arrangement with St. Anthony’s
because Morton believes it seals the fates of the
physicians and hospital together.
“It was a big step for St. Anthony’s to basically
give up control of the entire cardiac service line—
nearly 40 percent of hospital revenues,” says Morton.
“At the same time, we physicians gave up our freedom
to go back into private practice when we cut our ties
with our old cardiology group. We are both stepping
off the cliff together.”
St. Anthony’s did not buy the cardiology group that
Morton founded; rather, the hospital hired 11 members
of that practice. The physicians’ compensation is tied to
their performance. In the hospital’s FY12, says Morton,
their pay will be based in part on how well the service
line performs on 10 surgical and medical quality
measures and goals, including decreased mortality
for bypass surgery patients.
As head of the Heart Specialty Center, Morton reports
directly to St. Anthony’s CEO. The Center’s executive
director, who manages day-to-day operations, reports
to Morton. The Center is governed by a nine-member
strategic council comprised of seven physicians, the
Center’s executive director, and St. Anthony’s CEO, who
serves as liaison between the heart program and other
hospital administrators.
“It was a big step for St. Anthony’s
to basically give up control of
the entire cardiac service line. At
the same time, we physicians gave
up our freedom to go back into
private practice.”
Reducing supply costs
In addition to attracting patients to St. Anthony’s, the
physicians are willingly identifying ways to reduce
costs. “Given declining reimbursements for physicians
and hospitals, it is in our best interest to ensure that we
reduce costs in a way that will actually increase the quality
of care,” says Morton. “We are able to use the monies
that we save by reducing inefficiencies and supply costs
to expand our facility and to improve care.”
One of the first targets for cost savings: supplies.
Interventional radiologists, vascular surgeons, and the
cardiac catheterization laboratory at St. Anthony’s had
historically contracted for supplies and medical devices
separately, which led to triple inventories for common
items, such as interventional catheters, stents, and
pacemakers. Now that all three specialties are using
common supplies, hospital materials management
staff have been able to negotiate volume-based price
discounts on these supplies, which is expected to save
at least $1 million a year.
Although the relationship is too new to analyze
ROI implications, John Skeans, St. Anthony’s CFO and
vice president of finance, likes what he sees so far.
“Partnering with physicians does not always make
sense. But given the quality of this group of cardiologists—all of whom can demonstrate proven positive
outcomes—this is a financial win for us,” he says.
Probability of Physician interest in alignment by model
Percentage of physicians interested in more closely
integrating with a hospital
42%
Uninterested
58%
Interested
in closer
hospital
alignment
The alignment models that physicians are most
interested in pursuing in the next two years
Directorships, stipends,
and contracts
51%
46%
Employment
Joint venture
of services
38%
Comanagement
Leasing
34%
21%
Source: PwC Health Research Institute Physician Survey, 2011. Reprinted with permission. Data from PwC Health Research Institute 2011 survey of more than 1,000 physicians.
LeaDERSHIP FALL 2011
Building the relationship
10
Leading the change
Photo: St. Anthony’s Medical Center. Reprinted with permission.
The most important lesson learned, Morton says,
is that the traditional distrust between hospital
administrators and physicians must be overcome
for a true partnership to be achieved.
In St. Anthony’s case, the physicians and hospital
leaders developed a set of guiding principles before
they started negotiations, and Morton says that has
proved to be invaluable. By agreeing to core values,
goals, and a mission for the Heart Specialty Center
in advance, all parties had a framework that made
decisions about financial, governance, and operational
issues much easier.
“For this to work, both of you have to say, ‘Okay,
this is something that we are going to do together as
an entity, working together,’” says Morton.
Cardiovascular surgeon James Scharff, MD, performs
complex surgeries in a dedicated cardiovascular
surgical suite AT St. Anthony’s Medical Center.
Case Study: Organizing Community Physicians To Manage Populations
The cardiologists St. Anthony’s hired had measured
and benchmarked their quality of care over a number of
years. “It’s one thing to say you are good; it’s another
to have the data to show it,” says Morton.
Keeping the patient in mind
Morton and his colleagues have organized the Heart
Specialty Center with the goal of providing patientcentered care. “Hospitals are traditionally set up to run
the way that the hospital wants, but not necessarily the
way patient care is carried out,” says Morton. “We have
totally flipped that backwards so that now we are
flowing with the patient.”
In the past, for example, staff members in the
preoperative area, operating room, cardiovascular
intensive care unit (ICU), and telemetry unit had each
reported to a different manager, which set up opportunities for conflict. Now all staff members who serve a
cardiac surgery patient report to a single manager.
Similarly, the physicians are adjusting staffing
patterns to improve patient outcomes and ensure
nurses spend more time at the bedside. In the cardiac
cath lab, for example, administrative functions that
were being performed by ICU-level nurses have been
assigned to other staff members, freeing the nurses
to focus on patient care.
Morton advises making organizational changes
incrementally to give staff time to adjust to the new
way of doing business. “I think the restructuring has
been hardest on middle management,” he says.
“There is a long history of the way hospitals operate,
and this is a foreign concept for many managers.”
Like St. Anthony’s, St. John Providence Health System
in southwest Michigan employs physicians (about 400);
however, the vast majority of its medical staff are
independent practitioners. Instead of hiring more
physicians, the five-hospital system is working with
its physician-hospital organization (PHO) to create a
situation that will allow medical staff members to
remain independent and participate in the accountable
care movement.
A major payer in the area, Blue Cross Blue Shield
of Michigan (BCBSM), is pushing hospitals and
physicians to create organized systems of care (OSC),
which is the Michigan Blues’ twist on the accountable
care organization (ACO) model. BCBSM plans to offer
financial incentives to highly functioning OSCs by
2013, and St. John Providence Health System, which
is part of Ascension Health, is getting ready.
Guiding Principles for Organized Systems of Care
>>An organized system of care (OSC) is a high-performing
healthcare system with accountability for managing
the delivery of healthcare services to a defined population
of patients
>>The patients attributed to a community of primary care
practices define the population served by the OSC
>>An OSC serves the needs of a community of patients
in an effective and efficient manner across care settings
and over time
>>OSCs deliver effective, high-quality care consistent with
Blue Cross Blue Shield of Michigan’s patient-centered
medical home standards and Institute of Medicine standards
>>OSCs focus on improving population health, enhancing
patient experience, and reducing cost
>>OSCs acquire and manage the tools and infrastructure
needed to operate effectively
Source: Blue Cross Blue Shield of Michigan. Reprinted with permission.
11
Building on the medical home
Similarly, compared to traditional practices, these
medical homes have achieved the following.
NN A 7.5 percent lower rate of use for adult high-tech
scans, such as magnetic resonance imaging
NN A 9.9 percent lower rate of adult ED visits
NN A 3.8 percent higher rate of generic drug
prescriptions
The insurer’s vision is to expand its medical home
initiative so that primary care physicians, specialists,
and hospitals work together to coordinate services for
a defined patient population. “The OSC work that we
plan to do for the next five years is going to build
on that patient-centered medical home foundation that
has been developed over the past few years with the
Michigan provider community,” says Tom Leyden,
director of Value Partnerships at BCBSM.
Because BCBSM holds so much market share—dominating 70 percent of the commercial market in the greater
Detroit area—its initiatives have a powerful influence
on the state’s healthcare scene. For example, BCBSM
has the nation’s largest patient-centered medical home
effort. Using its own criteria, the payer began designating
medical homes in 2009—and about 2,500 physicians
have already achieved the Blues’
medical home designation.
More than 200 of those designated
Many things in life are unreliable.
medical home practitioners are
St. John Providence physicians, and
others are working to meet the medical
home criteria. “We continue to push
as many of our physicians as we can
to move in this direction because we
think it’s going to be a requirement for
being able to deliver on the Triple Aim
of improving the experience of care,
improving the health of populations,
and reducing the per capita cost of
health care,” says Eathorne. (The Triple
Aim is a program of the Institute for
Healthcare Improvement; www.ihi.org.)
An initial assessment by BCBSM
of its medical home program suggests
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St. John Providence’s PHO—St. John Providence
Partners in Care—is taking the lead on organizing about
2,200 physicians to participate in a St. John Providence
OSC, while the health system is spearheading the
technology investment and adoption needed to deliver
organized and accountable care.
“There is a lot of uncertainty around accountable
care, and with that comes a lot of concern,” says Scott
Eathorne, MD, medical director for the PHO. “But these
effective partnership arrangements are keeping us
focused on setting up the right structure for success.”
12
To encourage hospitals and physicians to prepare
for OSC contracts, BCBSM launched two OSC-specific
initiatives this summer: systemwide patient registries
and performance measurement across the continuum
of care. A third initiative—care processes that span
the OSC—is planned for early 2012.
Sharing Technology
Clinical IT is obviously key to the coordination of care
that is at the heart of medical homes and ACOs, and
St. John Providence has taken the lead on getting the
IT infrastructure in place.
The five hospitals in the St. John Providence Health
System began using an electronic health record (EHR)
about three years ago, and computerized physician
order entry was installed this summer. While some
affiliated physicians have acquired their own EHR
technology, or used some IT tools made available by
the health system, there has been no attempt to broadly
connect the hospital and physicians—until now.
The health system worked with St. John Providence
Partners in Care, the PHO, to develop a comprehensive
ambulatory clinical IT strategy that is getting under way
this year. This includes a health information exchange
(HIE), EHR, disease registry, e-prescribing, and a patient
portal. “This will facilitate communication between
providers, between the providers and the hospitals, and
ultimately, between providers and patients through the
patient portal,” says Eathorne.
The goal of the new strategy is to have about 1,000
physicians who collectively manage the health of nearly
120,000 lives connected electronically by 2013.
“There is a lot of uncertainty
around accountable care, but
these effective partnership
arrangements are keeping us
focused on setting up the right
structure for success.”
All physicians who contract with insurers through
the PHO will be expected to adopt technology that
allows them to share patient data, although a range of
options will be permitted. Those physicians who have
their own EHR systems, for example, may use the HIE;
others may only use the disease registry function.
Within the limitations allowed by law, St. John
Providence is subsidizing the cost of the ambulatory EHR
system. BCBSM and other payers are also providing
financial incentives to encourage technology adoption,
says Eathorne. BCBSM pays incremental bonuses to
physicians as they add IT capabilities, such as patient
registries or patient portals, that are associated with
improved efficiency and quality of care. In addition, the
PHO is working with physicians to help them become
eligible for meaningful use subsidies.
Top Challenges to Medical Home Transformation
Percentage of responding patient-centered medical homes (PCMHs) that cited these issues as considerable or extreme challenges
Projecting financial effects (practice revenue,
costs, etc.) of the transformation to PCMH
36.0%
Modifying or adopting an EHR system to
support PCMH-related functions
37.5%
Coordinating care for high-risk patients
38.0%
Financing the transformation to PCMH
Establishing care coordination agreements
with referral physicians
42.9%
50.8%
Source: The Patient-Centered Medical Home: 2011 Status and Needs Study, Medical Group Management Association (MGMA), 2011. Reprinted with permission.
Data from 2011 MGMA survey of 341 medical practices.
13
Leaders of the St. John Providence Partners in Care
PHO must get more than 2,000 physicians, most of
whom are self-employed, to agree on a new way of
doing business—which is no small task. For Eathorne,
the experience has proved the value of establishing
a vision and guiding principles. The vision for the
St. John Providence OSC is to establish a partnership
that takes advantage of the size of the physician network
and the size and geographic scope of the St. John
Providence Health System, as well as its relationship
with its parent Ascension Health.
To operate as an OSC, the physicians and hospital
must figure out how to share governance, reduce
wasteful procedures and diagnostics, coordinate care
to improve patients’ outcomes, handle financial risk,
distribute money, and get around other thorny issues
that can be difficult to negotiate.
“People ask, ‘Why are we doing this?’ By having
established that driving vision, we continue to remind
ourselves of what we wanted to do collaboratively,
and then we can work through some of these difficult
issues,” he says.
One key to establishing the OSC framework for an
effective partnership was bringing the six physician
organizations that contracted under the PHO together
around a common cause. The result of that effort was
the formation of The Physician Alliance, a new physician
organization serving the nearly 2,200 St. John Providenceaffiliated providers. A 50-50 partnership between The
Physician Alliance and St. John Providence Health System
is the foundation of the PHO. Various PHO committees
are working through the details and establishing the
relationships needed to better organize care and finetune the business model, says Eathorne.
Another lesson: The changing dynamics in health
care require new ways of thinking. Hospitals’ traditional
status as the hub of the healthcare system may
change in the accountable care era, when the payment
system rewards physicians for keeping patients out
of the hospital.
“We are building this continuum of care that
recognizes that individuals are best served when they
have a longitudinal relationship with their primary
providers,” says Eathorne. “It’s each hospital’s responsibility to understand its role in the continuum, and
that, for the most part, inpatient care is a small part of
the overall healthcare needs of any given individual.”
That said, creating a partnership in which both the
hospitals and physicians thrive together is essential
to the success of an OSC. “Our goal here is not to put
anybody in the red,” he says. “It is to work together
so that, overall, we are well-positioned for when the
full-scale change in the payment structure really occurs.”
Case Study: Moving Toward a Coordinated Population-Based Approach
Similar to St. John Providence, Sentara Healthcare,
a 10-hospital system based in Norfolk, Va., had its eyes
set on becoming an ACO. But then it saw the Centers
for Medicare & Medicaid’s proposed ACO rule for the
Medicare Shared Savings Program.
The term “ACO” went out the window because
Sentara leaders believe that the government’s proposed
rule presents too many barriers to success. But the health
system’s commitment to accountability remains strong.
“What we talk about now is the need to do a better
job of integrating all the key stakeholders into a model
that will move us away from a fragmented approach to
care to a much more coordinated approach to care,”
says David R. Maizel, MD, the system’s corporate vice
president and president of Sentara Medical Group.
The health system’s strategic plan includes three
imperatives (see the exhibit below).
NN Score in the top 10 percent of all health systems
on performance metrics related to clinical quality,
patient satisfaction, employee engagement, and
financial stewardship
NN Grow through acquisitions
NN Transform care delivery to ensure coordinated
population health management
Sentara’s EHR is a key component to these three
strategies. The EHR—which already connects most
of its hospitals, physician offices, and other care
sites—is creating efficiencies and quality improvements that many health systems only dream about
(see Section 4, page 50).
Sentara’s 2010-2012 Strategic Goals
Score in
top 10% on
performance
metrics
Transform
care
Vision
Grow
through
acquisitions
Source: Sentara Healthcare. Reprinted with permission.
Setting a Vision
14
“The first imperative is
to be considered in the
top 10 percent of health
systems in everything
that we do.”
That technology—and the new levels of knowledge
it brings because of the ability to capture and analyze
data—is being used to create the optimal patient
experience. “Everything that we’re doing from a
transformation standpoint is really driven by our goal
of being patient-centered,” says Maizel.
Transforming care delivery
As it moves from a fragmented care model to a more
comprehensive, coordinated approach, Sentara is
designing services around four specific patient groups:
NN Healthy individuals who have occasional, minor
acute problems and should mostly focus on
wellness and preventive services
NN Patients with one or two chronic illnesses who
are generally stable but require management
NN Patients who have multiple chronic conditions,
some of which exacerbate one another, and require
extensive management
NN Persons with severe illnesses, such as cancer, that
require intensive treatment, and those near the end
of life who should have advanced care plans that
guide decisions about treatment and palliation
Setting high goals
Hoping to differentiate itself on quality and cost—and
reap pay-for-performance rewards and contracts from
payers—Sentara aims to prove itself a top performer
in four domains:
NN Clinical quality and safety
NN Patient satisfaction
NN Employee engagement
NN Financial stewardship
“The first imperative is really to be considered in
the top 10 percent of health systems in everything that
we do,” says Maizel.
Sentara has already achieved that status on some
patient safety measures, thanks to a systemwide initiative that dates back to 2002 (see Section 2, page 22).
Since that time, central line-related blood stream
infections have been reduced by 90 percent across all
Sentara hospitals, and ventilator-associated pneumonia
has declined by 98 percent.
Sentara, which tallied operating revenues of
$3.39 billion for FY10, reported a 5.6 percent operating
margin for the year. The system also enjoyed an
employee-satisfaction win for the year when its survey
vendor issued a “workplace excellence” award in
recognition of high scores that reflect an engaged
workforce. The award is given to fewer than 5 percent
of the vendor’s clients.
“We are identifying specific patient populations
and how to really optimize the patient experience for
those populations in the most cost-effective way,”
says Maizel.
To move toward this population health management
model, Sentara started with an initiative to redesign
primary care, converting practices it owns into patientcentered medical homes. The main goals are to build
capacity so as to increase patient access and improve
outcomes by serving patients in new ways.
For example, the medical home practices now offer
group visits for patients with certain chronic illnesses,
such as diabetes. These give patients the opportunity
to learn from each other, while freeing physicians to
devote more time to managing each patient’s specific
health needs.
Providers in the pilot practices were initially
concerned that the redesign would impact their productivity, and they were skeptical about patients’ reaction
to the changes, says Maizel. “Our results from tracking
the data demonstrate no reduction in productivity. In
fact, access has improved,” he says. “And patients
have noticed the changes and have commented on how
much more engaged the staff is in meeting their needs.
Patient satisfaction scores remain strong.”
Additionally, the medical home practices have
improved patient scheduling to accommodate
same-day appointments, which help keep patients
from going to the emergency department (ED) for
urgent—but not emergency—conditions like earaches
and sinus infections. Same-day appointments also
allow patients with congestive heart failure and other
chronic illnesses to receive immediate care, which may
head off deterioration that would require hospital treatment. In a pilot for the redesign work at two practices,
same-day appointments increased by 97 percent.
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16
The medical home model also helps keep patients
who were recently discharged from the hospital from
being readmitted. The percentage of patients who
were seen by a primary care physician within seven
days of a medical discharge doubled at one medical
home pilot site and quadrupled at another. The result:
30-day hospital readmissions for patients with certain
chronic conditions fell from 24 percent to 12 percent
of inpatient discharges.
Because Sentara’s eCare EHR system shares information between hospitals and physicians, primary care
providers are notified immediately when one of their
patients has visited an ED or been hospitalized. In one
case, a primary care provider telephoned a patient
before that patient was fully discharged from the ED,
says Maizel. “The power of technology is pretty evident
in a situation like that.”
Five Sentara Medical Group clinics have completed
the conversion to medical homes, and six others are
in the process. By the end of 2012, all of the Sentaraowned primary care practices—about 15 to 20 percent
of the primary care providers in the Norfolk-Virginia
Beach area—will be redesigned, says Maizel.
Expanding the improvement
Converting its owned primary care practices to medical
homes is just the beginning of Sentara’s redesign work.
“We have started an outreach program to other primary
care physicians in the market, regardless of whether
they are independent, small practices, or members of
larger group practices,” says Maizel. “Hopefully we can
assist them in implementing some of what we have
learned to help raise the bar in terms of how we are
providing care to the citizens of our communities.”
Beyond that, Sentara will be using lessons learned
from the primary care conversions to help redesign its
long-term care and home health services as the health
system works to improve care across the continuum
for all patient populations. “We really need to look
at this longitudinally and across all venues of care—
and how we transfer the care from one setting to the
other,” he says.
Growing to increase efficiency
Sentara has acquired three hospitals in the past year,
growing to become a system of 10 acute care hospitals,
six outpatient care campuses, seven nursing homes,
three assisted living centers, eight advanced imaging
centers, and about 380 employed primary care and
specialty physicians.
More acquisitions are coming. Sentara’s leaders are
looking for hospitals that have been successful in their
markets but cannot afford the technology, quality, and
clinical integration investments needed to succeed in
the era of accountable care. “The reality is that Sentara
can leverage the infrastructure that we currently have in
place and deploy that to additional locations at a much
lower cost than if an individual hospital was just trying
to do it in one location,” says Maizel. “Partnering with
us is a huge value-added proposition for both organizations as we come together and merge.”
In the lead-up to a merger, Sentara spends a significant amount of time and energy doing an assessment
of the cultural climate of all entities involved in the
transaction. It also establishes an integration team with
staff from both entities to address the various aspects
of the merger, such as human resources, finance, and
materials management.
“It’s easy to assume the larger entity will dominate
or exercise influence in all decisions,” says Maizel.
“We have learned that each side brings value to the
newly consolidated organization, and we need to be
open and flexible in our approach.”
Case Study: Integrating to Remain
Independent
Some observers believe that small, rural, independent
hospitals will be unable to make the transition from
fee-for-service medicine to value-based care delivery.
The leaders at Winona Health, a fully integrated health
system in Winona, Minn., think otherwise.
The system includes a 99-bed hospital, a nursing
home, and an assisted living community. Winona
Health also employs 45 physicians, which is nearly
the entire medical staff, since it consolidated with two
physician practices. All components of the health
system use the same EHR.
Thus, Winona Health has assembled a well-rounded
set of resources to deliver high-value health care.
But the term “value” was not even in the healthcare
vernacular when Winona started working closely
with its medical staff to strengthen the community
healthcare system.
17
Building for the community
Several years ago, Winona Health extended an
open-ended invitation to local physician practices. The
system wanted physicians to know there was a local
option if there ever came a time when they wanted to
consolidate with a larger organization.
“And that’s what happened—the time came,” says
Allen. A large multispecialty practice merged with
Winona Health in 2008, and one year later, a primary
care practice followed suit.
Winona Health’s primary motivation for acquiring
the practices was to keep physicians locally employed
in Winona, a community of about 28,000 residents. But
the system’s leaders recognized that the consolidation
of services would diversify and grow its revenues.
We weren’t interested in just buying practices and
then just having a bunch of different operations,” says
Allen. “We were interested in truly having an integrated
organization. Top-line revenue growth wasn’t our
primary objective, but as we got into it, we understood
there would be many benefits to the community if we
did this well—and truly merged.”
As the emphasis on value in healthcare delivery is
becoming more pronounced, the wisdom of Winona
Health’s willingness to integrate has become more
clear. “Hospitals and clinics—or administrators and
physicians—working together in the same organization
is critical to success,” says Winona CEO Rachelle
Schultz. “Whether you’re a small, rural, independent
hospital or a large metropolitan system, the integration
piece is going to be essential for the model that we
need in the future.”
Restructuring Service Lines
In 2008, Winona Health reorganized its administrative
structure into five service lines:
NN Primary care services
NN ED/urgent care services
NN Inpatient services
NN Surgical/specialty services
NN Senior services
“Whether you’re a small, rural,
independent hospital or a
large metropolitan system, the
integration piece is going to be
essential for the model that
we need in the future.”
Each service line is headed jointly by a full-time
administrator and a practicing physician who devotes
20 percent of his or her time to service line administration. The primary role of the physician leader is to
communicate, understand the needs of, and lead the
rest of the medical staff through the change process
under way in the healthcare system, particularly as
it relates to the role of the physician in the future,
says Schultz.
“There is considerable physician input into the
direction of the hospital and the initiatives we decide to
put our time into,” says Brett Whyte, MD, the physician
administrator for the ED/urgent care service line. For
example, physician administrators work on protocol
development, peer review, quality initiatives, and the
hiring of provider staff.
This organizational structure has proved itself
through steadily improving clinical quality and efficiency,
says Schultz. The hospital’s average inpatient length
of stay has decreased in recent years, and its 30-day
readmission rate is 2.2 percent, compared to the national
average of more than 18 percent. Schultz attributes
those successes to Winona Health’s coordination of
services across the continuum of care.
In addition, Winona Health has received pay-forperformance payments from insurers and from the
federal government for its participation in the Physician
Quality Reporting System and e-prescribing initiatives.
Facing Challenges
Just like other systems, Winona Health has found that
some physicians are happy to give up the administrative hassles of running their practices in return for job
security and more stable income, but they want the
decision-making autonomy they have enjoyed in the
past, says Whyte.
The system’s leaders were working to ensure
Winona had enough physicians to keep healthcare
services local and focused on the community’s needs,
says CFO Mike Allen. “Along the way, our fundamental
goals of increasing our scope and preserving services
for the community ended up presenting us with other
opportunities that we didn’t even realize were out
there,” he says.
18
“Part of our jobs as physician-administrators is
massaging the relationship with all providers into a
place that works for both parties,” he says. The key, he
has found, is involving physicians—and for that matter,
nurses, orderlies, and all staff—in decision making so
they are vested in making new initiatives work.
For example, when Winona Health set a goal of
attaining a Level IV trauma designation from the state
of Minnesota, physician administrators tracked quality
measures related to trauma management to show
Winona Health’s performance, which helped staff
members get on board. “Medical people like data
and begin to believe in an initiative when they see
improvement in the numbers,” says Whyte.
Another challenge is the financial burden that came
with merging with physician practices. “Beyond the
acquisition costs, the biggest investment is the time it
takes to build relationships, look for best practices,
consolidate administrative functions, and assimilate
cultures,” says Allen. “We have spent and continue to
spend a lot of energy around all of these issues because
they are drivers for success.”
In today’s healthcare environment, the revenue
produced by the typical outpatient clinic is not sufficient
to pay the ever-rising costs of staff, equipment, utilities,
and facilities needed to generate that revenue, says
Allen. “But if you merge that physician clinic model
into an integrated health system that already has a lab,
radiology, surgery, and other services, you can find the
efficiencies to help reduce or eliminate those losses,”
he says.
Long term, Winona expects to reap anticipated
rewards. “The lesson is to commit to full integration,
administratively and clinically, and trust that the efficiencies can be found to make the merger financially
worthwhile,” says Allen.
On the clinical side, Winona aims to achieve
efficiencies and improve quality by creating a seamless
continuum of care. “We’re trying to create the clinical
processes that follow the patient according to his or
her specific needs throughout the continuum of care—
whether clinic to hospital to home care or to long-term
care” says Allen. “These are not separate processes; it
is one process of care delivered in different locations.”
One step to achieving this seamless continuum:
Developing evidence-based order sets for common
complaints and diagnoses (for example, chest pain or
shortness of breath) that can be used in various settings
across the continuum. For example, if Whyte sees a
patient with chest pain in the ED, he uses the same
protocol that would be applied in an outpatient clinic
or nursing home. “I now rely less on my memory to
remember all the necessary tests or treatments that
each patient needs,” says Whyte.
All of these improvements reflect Winona’s goal of
developing an integrated, coordinated model of care.
Leaders of integrated health systems should understand the important role of ambulatory care in the
healthcare delivery system as a whole. Hospitals are an
important component but not at the exclusion of the
rest of the system. Indeed, hospitalizations may signal
the failure of meeting patient needs in the ambulatory
setting, says Schultz.
But today’s regulatory and payment environments
make the hospital the dominant engine, creating a
barrier to the culture change that needs to happen,
she says. “It is a very difficult shift to make mentally
because we’re operating in a hospital world when
we really need to be operating in an integrated, crosscontinuum way,” says Schultz.
>>
Next: Avoiding Patient Harm
Embracing integration opportunities
Soon after Winona Health acquired the two physician
practices, leaders instituted some changes to gain rapid
economies of scale. For example, one of the first moves
was to combine outpatient and inpatient laboratory
and physical therapy departments.
Winona Health’s hospital and clinic business offices
have also been combined and will soon be using a
single information system that manages the billing
processes for inpatient and outpatient services.
The goal: By 2013, Winona Health will be able to
produce a single patient-friendly bill that includes
ambulatory and hospital charges, says Allen. Key steps
to achieving this goal include re-mapping the revenue
cycle, creating standardized work processes, consolidating and integrating billing systems with the EHR,
and automating as many steps as possible.
Providers are reducing patients’ risks of suffering
unnecessary infections, side effects, and other
harm—while improving their organizations’
performance on quality and financial metrics.
See Section 2, page 20.
20
Avoiding
Patient
Harm
Now that payers are beginning to tie payment to
performance, the ROI for preventing patient harm
extends beyond the moral and ethical payback.
However, as these three providers stress, the primary
motivation for improving patient safety is still
immensely personal and altruistic.
22
Providers have never needed a business rationale
for trying to minimize the potential harm—including
hospital-acquired infections, treatment side effects,
and unnecessary hospital admissions—that can occur
to patients. Primum non nocere, afterall, is a core
medical ethic. Physicians, nurses, and all clinicians
are motivated to “first, do no harm.”
But the individual healthcare professional, no
matter how committed to patient safety, can only do
so much to reduce hospitalwide infection rates or
communitywide emergency department (ED) visits.
As the case studies in this section illustrate, systematic
approaches—from a leader-driven safety commitment
to the adoption of evidenced-based protocols—are
required to achieve dramatic reductions in indicators
of patient harm.
Payment system changes and increased transparency are beginning to provide business rewards for
investing in efforts to improve scores on metrics related
to quality and patient safety. On the government front,
Medicare’s new Inpatient Value-Based Purchasing
Program will reward hospitals that provide high-quality
care—and penalize those that do not. Private payers are
following suit with similar performance-based contracts
with providers. At the same time, patients can now
go online and compare hospital-acquired infection,
mortality, and readmission rates among providers in
their communities—giving organizations another
business rationale for making value-driven investments
in patient safety.
>>
Common Approaches
Some similar approaches to reducing patient harm are
being used by all three providers featured in this section.
>>Creating an organizationwide culture of safety—while
recognizing the need for decentralized approaches
>>Relying on standardized protocols, checklists, and other
aides to remember critical patient care steps
>>Empowering physicians, nurses, and other staff to spot
and respond as a team to potential patient problems
>>Ensuring that at-risk patients receive proactive care
management
>>Spreading successful best practices across units,
organizations, and systems
Case Study: Empowering Staff >
to Save Lives
Half of the ventilator-associated pneumonia (VAP)
cases that occur in U.S. intensive care units (ICUs) each
year—about 20,000—could be prevented, according to
the Partnership for Patients.
But Sentara Healthcare’s VAP track record suggests
that many, many more patients could be spared from
this serious hospital-acquired infection.
Since 2002, the VAP rate in the entire 10-hospital
Sentara system has fallen by 98 percent, from
124 VAP infections per year to the current rate of just
two per year. One of the system’s hospitals—Sentara
Williamsburg Medical Center—has not had a single
VAP incidence in more than seven years. Most other
hospitals in the Sentara system, which serves parts
of Virginia and North Carolina, are also marking off
multiple years with zero VAP incidents.
Spreading a culture of safety
These successes at Sentara Healthcare stem from a
patient safety initiative launched at the system’s largest
facility, Sentara Norfolk General Hospital, in 2002. An
assessment identified three common problems that
were contributing to safety incidents at Sentara Norfolk,
according to a case study by The Commonwealth Fund
(Klein, S. and McCarthy, D., Sentara Healthcare:
Making Patient Safety an Enduring Organizational
Value, March 15, 2011).
NN Inadequate communication
NN Noncompliance with policies
NN Failure to recognize high-risk patient situations
23
After a successful pilot at Sentara Norfolk, this
four-pronged program was expanded to the other
Sentara hospitals in late 2003.
Staffing for safety
In addition to its zero-VAP record, 150-bed Sentara
Williamsburg Medical Center in Williamsburg, Va. has
had no central line-associated bloodstream infections in
more than four years, and no urinary tract infections in
more than two.
John Kaiser, MD, the lead intensivist who works
full-time in the hospital’s ICU, believes his job description contributes to the hospital’s patient safety record.
Intensivists are critical care physicians who have
special expertise in monitoring ICU patients. Some
research has shown that ICUs managed exclusively
by board-certified intensivists have significantly lower
VAPs Down by 98 Percent >
Across Sentara
Ventilator-Associated Pneumonia (VAP)
Rate/1,000 Vent Days
6.15
4.26
2.23
‘02
‘03
‘04
1.57
‘05
“Sentara has let me do
my job, which is unusual
in a large corporate
structure.”
mortality rates than ICUs with other staffing arrangements (Pronovost, P.J., et al, “Physician Staffing
Patterns and Clinical Outcomes in Critically Ill Patients:
A Systematic Review,” JAMA, 2002, vol. 288, no. 17,
pp. 2151- 62).
Despite the evidence that intensivists may save
lives, only about 35 percent of hospitals responding
to a 2010 Leapfrog Group survey had intensivists
dedicated to the ICU during daytime hours.
Kaiser and other physicians in a group practice
used to share responsibility for covering the hospital’s
ICU; Kaiser spent about half his time at the hospital
and half in his office practice. In 2004, the hospital hired
Kaiser to work five days a week in the ICU—with no
other job responsibilities—while the other physicians in
his former group practice provide night and weekend
coverage, as needed.
In the first quarter after hiring Kaiser, the ICU mortality rate at Sentara Williamsburg dropped by more than
30 percent. In addition, sepsis mortality, line infections,
ventilator days, and ICU length of stay all went down.
Just as telling: The ICU has maintained these positive
outcomes since 2004.
What exactly changed? “It was the same people
taking care of the patients,” he says. “The only difference was I am here instead of taking calls, making
rounds, and going back to the office.”
The hospital pays Kaiser a fixed salary, which
frees him from worrying about whether he is working
enough billable visits and tasks. From the hospital’s
perspective, that salary is covered many times over
because, by improving patient safety, the ICU is
eliminating the financial risks associated with hospitalacquired conditions and costly ICU stays. Sentara
Williamsburg administrator Bob Graves points out that
VAP increases ICU length of stay by at least five days.
The cost of treating each VAP is estimated at between
$11,800 and $25,000.
Empowering staff
0.98
0.47
‘06
‘07
0.38
0.42
0.09
‘08
‘09
‘10
Like other Sentara facilities, the Williamsburg hospital
relies on standardized protocols, checklists, and other
aides to remember critical and important patient care
steps that help prevent VAP and other hospital-acquired
conditions. However, the Sentara culture also recognizes physicians, nurses, and other clinicians as experts
in their specific fields who are trained to spot and
respond as a team to potential patient problems.
This assessment informed the development of a
Sentara-wide approach to patient safety, which includes
four elements:
NN Safety is a core organizational value, and safety
performance influences the paychecks of Sentara’s
top leaders, as well as frontline staff in each hospital
NN Forty percent of the variable pay for Sentara’s top
100 leaders is linked to the system’s quality and
safety measures, as are half of the performance
measures in Sentara’s bonus program for frontline staff members
NN All employees are encouraged to adopt safety habits
that prevent errors (see the exhibit on page 24).
NN Checklists, clinical protocols/guidelines, and other
standardized tools are used to simplify work processes and limit the opportunities for human error
NN Root-cause analysis is used to identify problems that
contribute to safety incidents so that pinpointed
solutions can be identified for systemic improvement
24
Sentara Healthcare’s ErrorPrevention Toolbox
>>Pay attention to detail: Follow the “stop, think, act, review”
(STAR) method to focus attention and think before initiating
a critical task
>>Communicate clearly: Use repeat-backs and read-backs
and ask clarifying questions to ensure that you understand
requests
>>Have a questioning attitude: If something doesn’t seem
right, take time to figure out why
>>Hand off effectively using a “5P” checklist: To ensure
that all elements of a successful transfer are followed, the
handoff should identify the patient/project, plan, purpose,
problems, and precautions
>>Never leave your wingman:
Use peer checking and peer
coaching as appropriate
Source: The Commonwealth Fund, 2011. Reprinted with permission.
“I encourage the ventilator techs to manage the
ventilator flow,” says Kaiser. “Of course we discuss
it, but if they are managing it, they are much more
involved with what’s going on. If the nurses think they
need to make a suggestion, they know I will listen to
them. The more I listen to them, the more involved
they become.”
Kaiser’s perspective reflects one of Sentara
Healthcare’s core strategies for creating a culture of
safety: encourage “mindfulness” among staff members
so they quickly recognize and respond to signals of
emerging patient problems. “Sentara has let me do my
job, which is unusual in a large corporate structure,”
says Kaiser.
Encouraging hospital-specific approaches
While patient safety is a Sentara-wide goal, leaders
have decentralized the how-to’s of patient safety,
leaving many specific action steps up to each individual
hospital. The Sentara hospitals share best practices,
but each hospital has leeway in determining how it
will meet its safety goals. For example, while some
Sentara ICUs have dedicated intensivists, others use
an electronic ICU remote monitoring system.
The organization’s emphasis on safety has reduced
the rate of serious safety events at Sentara hospitals
by 80 percent between 2003 and 2010. At Sentara
Williamsburg, Kaiser estimates that improved patient
safety translates into 40 fewer deaths in the ICU each
year than would be expected.
Case Study: Reducing Cancer Care
Complications
Since converting to a patient-centered medical home,
a Pennsylvania oncology practice has improved the
care of its patients—and significantly lowered the
overall costs of cancer care by doing so.
“We’re bending the healthcare cost curve by eliminating unnecessary expenditures,” says John Sprandio,
MD, lead physician at Consultants in Medical Oncology
and Hematology (CMOH), Drexel Hill, Pa. “This is better
care for our patients, and less expensive care.”
When people talk about the potentially avoidable
conditions associated with health care, they generally
mean hospital-acquired infections, patient falls, blood
clots, etc. While several common chemotherapy side
effects—dehydration, diarrhea, nausea, and vomiting—
are not entirely avoidable, they can potentially be
managed to avoid severe debilitation and hospital
intervention.
Sprandio and his colleagues began reengineering
their cancer care processes in 2004. Since then, the
practice has demonstrated that it can keep cancer
patients out of the hospital and the ED through proactive management of common symptoms related to
cancer treatments, underlying diseases, and comorbid
conditions. Indeed, the practice has reduced its
patients’ ED use by 65 percent since 2004 and inpatient
admissions by 43 percent since 2008.
CMOH’s experience shows how an independent
physician practice can dramatically change healthcare
delivery. Between 2004 and 2010, CMOH patients
had 55 percent fewer ED visits and 40 percent fewer
hospitalizations compared to national benchmarks for
chemotherapy patients. As a result, the oncology practice
helped patients avoid more than $6.5 million in hospital
and ED charges in 2010, according to a CMOH analysis.
Significantly, the changes in care delivery did
not negatively impact patient outcomes. The five-year
survival rate for CMOH patients remains the same
as the national average, just as it was before care
processes were reengineered.
Successfully Managing >
Cancer Patients
Consultants in Medical Oncology and Hematology has
achieved the following.
>>A 65 percent decrease in patient
ED use since 2004
>>A 43 percent decrease in inpatient
admissions since 2008
>>$6.5 million saved in avoidable
hospital and ED charges in 2010
Source: Consultants in Medical Oncology and Hematology.
65>
percent
43>
percent
6.5>
million
25
In 2010, CMOH became the first oncology practice to
earn the National Committee for Quality Assurance’s
(NCQA’s) imprimatur as a patient-centered medical
home. All four CMOH locations have used electronic
medical record technology since 2006, and they employ
all the tenets of the NCQA’s medical home model.
NN A team approach to patient care
NN Care coordination
NN Standardized clinical protocols
NN Patient education, navigation, and engagement
In addition to reducing costs for patients and payers,
the medical home model is saving money for the
oncology practice—specifically staffing-related costs.
Nationally, on average, oncologists are supported by
8.2 support staff. In comparison, CMOH oncologists only
rely on 5.5 support staff per physician. Sprandio attributes
CMOH’s need for less support staff to three strategies:
a team-based approach to care, the standardization of
care protocols, and internally developed software tools.
Just as primary care physicians are standardizing—
and improving—the care of patients with diabetes,
CMOH has improved the way it identifies and addresses
a patient’s chemotherapy and cancer-related symptoms.
For example, by standardizing the management of
diarrhea, CMOH has experienced a 50 percent decrease
“We think we are saving
$8,000 or $9,000 a year per
chemo patient because of
the medical home model.”
in patient admissions for the treatment of Clostridium
difficile, a persistent bacteria that causes diarrhea.
This has also resulted in fewer treatment delays related
to that symptom.
The practice has also standardized patient education,
so that all members of the healthcare team provide
patients with consistent information. Part of that
education involves helping patients assume more
responsibility by asking questions of their caregivers
until they understand their medical situations. In addition, patients are taught to monitor their symptoms and
promptly report troubling symptoms and side effects to
CMOH nurses to avoid potential ED or hospital visits.
CMOH nurses use symptom management protocols
to address patients’ concerns—often over the telephone.
For example, if a patient calls the phone triage line to
ask about vomiting, the nurse will provide education
on preventing dehydration, a side effect that frequently
sends chemotherapy patients to the ED.
Borrowing a primary care model
26
For more than 75 percent of clinical calls, the
patients manage their symptoms at home. Each
CMOH office accommodates unscheduled visits, and
about 10 percent of calls to the triage line result in
such office visits.
To date, one Medicaid health maintenance organization has an outcomes-based contract with CMOH that
supports its medical home services, but Sprandio
says national and local payers have expressed interest
in innovative arrangements. He believes CMOH will
enter into an oncology patient-centered medical home
contract with performance-based payments and
shared savings.
“We think we are saving $8,000 or $9,000 a year
per chemo patient because of the medical home
model,” he says. “That is a conservative estimate,
and it is substantial.”
Case Study: Spreading Infection
Prevention Successes
Shortly after Ascension Health launched its systemwide
Healthcare That Is Safe initiative in 2003, Mohamad
Fakih, MD, asked the system to support a pilot project
to reduce unnecessary urinary catheter use at his
hospital. Fakih is medical director for infection prevention and control at Ascension’s St. John Hospital and
Medical Center in Detroit.
Catheter-associated urinary tract infections
(CAUTIs) account for 80 percent of all urinary tract
infections in hospitals, and are identified as avoidable
hospital-acquired conditions. Although patients in
ICUs often require catheters, these devices are
frequently inserted—and remain in place—in non-ICU
patients more out of habit than medical necessity.
Noting that many urinary catheters at St. John did
not have an appropriate reason for use, Fakih developed
a program, with the help of multiple disciplines throughout the hospital, to educate nurses on how to reduce
catheter use (see the exhibit below).
At a Glance: Urinary Catheter Removal Program
Nurse-initiated removal of unnecessary urinary catheters program
Weeks 1-3
Week 4
Baseline: Collect urinary catheter
prevalence with evaluation for
indications (15 days).
Prepare for implementation.
Weeks 5 & 6
Implementation: Nursing staff
education, daily assessment of urinary
catheters, evaluation for indications,
and discussion with nursing staff about
removal of nonindicated catheters.
Rationale given to obtain order to
discontinue unnecessary urinary
catheters with nursing (10 days).
Weeks 7-12
After implementation: Urinary catheter
prevalence, one day a week for six weeks
(six days). Patient’s nurse to assess need
for catheter on a daily basis.
Quarterly
Sustainability: Urinary catheter
prevalence, one week quarterly
(five consecutive days) for five quarters.
Patient’s nurse to assess need for
catheter on a daily basis.
Source: St. John Hospital and Medical Center. Reprinted with permission.
Data review
and unit
feedback
27
Spreading improvements
St. John’s success in reducing urinary catheter use
provides an example of how a systemwide patient
safety program can inspire and support quality
innovation at an individual hospital. In addition, it is
an example of how a single hospital’s patient safety
initiative can improve medical practice across a health
system—and across the country.
Since 2007, a toolkit that was developed through
the St. John pilot has been used throughout Ascension
Health, the nation’s largest not-for profit health system.
This toolkit includes step-by-step guidelines, training
posters, and other materials that help other hospitals
adopt the St. John approach to reducing unnecessary
urinary catheter use.
The toolkit has also been adopted by the Michigan
Health & Hospital Association (MHA) as a best practice
for Michigan hospitals. Most recently, the Agency for
Healthcare Research and Quality, in partnership with
MHA, began promoting the toolkit as part of the national
implementation of the Comprehensive Unit-Based
Safety Program to Reduce CAUTIs.
“This started with $70,000 and a lot of commitment,”
says Fakih.
Innovating at the local level
St. John has addressed two types of inappropriate
urinary catheter use: those that should never have
been placed in the first place and those that were
appropriately inserted but no longer needed.
The direct costs added to a hospitalization because
of a CAUTI are estimated at $500 to $1,000. But Fakih
says even catheterized patients who do not suffer
an infection may have longer inpatient stays—he
estimates an additional 0.25 day because they cannot
be discharged until they have urinated after catheter
removal.
Ann Hendrich, PhD, Ascension Health’s vice president of clinical excellence operations, says St. John
inspired all other Ascension Health hospitals to follow
its lead in reducing urinary catheter use.
Nosocomial, or hospital-acquired, infections are
one of Ascension Health’s priorities for action, identified
in the health system’s Healthcare That Is Safe initiative.
“These are things that we don’t want to have happen
to us when we go in the hospital because they add
needless harm, they are mostly preventable, and they
cost the healthcare system and society a lot of money,”
says Hendrich.
Ascension Health’s Clinical Excellence Team, which
includes representatives from all nine of the system’s
regions, determines the best course of action for a
specific safety issue—such as the reduction of urinary
catheter use protocols developed at St. John—that
falls under a priority for action.
Each priority for action has an “affinity group”—
clinical leaders and other key stakeholders from
across Ascension Health—that is responsible for
pushing the adoption of best practices to all the
hospitals in the system.
This roll-out approach is responsible for Ascension
Health’s success in exceeding the original goal of the
Healthcare That Is Safe initiative. As of 2010, the
70-hospital system had reduced preventable deaths
by 1,500 people annually compared to 2004, and
significantly reduced birth trauma and pressure ulcers,
as well as hospital-acquired infections (Pryor, D., et al,
“The Quality ‘Journey’ at Ascension Health: How We’ve
Prevented at Least 1,500 Avoidable Deaths a Year—and
Aim to Do Better,” Health Affairs, April 2011, pp. 604-611).
>>
Next: Navigating the Regulatory Maze
Proactive providers are allocating time,
attention, and financial resources to ensure their
organizations comply with ICD-10, HIPAA, and
other regulations. See Section 3, page 36.
Ascension Health provided $70,000 to St. John to
fund the nurse-driven program, which helped cover
the salary of a nurse charged with implementing the
program over the course of one year. The nurse’s
responsibilities included providing training to nurses,
collecting and evaluating data on catheter use, and
rounding with two units a day to evaluate catheter
use on a patient-by-patient basis.
The program nurse educated other nurses during
multidisciplinary rounds on the different units to
evaluate the presence and need for the urinary catheter.
“Whenever the catheter does not meet any criteria for
necessity, the nurse recommends removal of the
catheter,” says Fakih.
In other words, the patient’s nurse owns the
process of evaluating the need for the catheter. If the
nurse determines that a catheter is not needed, the
patient’s physician is called to obtain an order for
its discontinuation.
In its first year, the program reduced unnecessary
urinary catheters by 45 percent. Further work addressing the placement of urinary catheters in the St. John
ED has reduced unnecessary urinary catheter use even
more. Five years after the program’s inception, urinary
catheter use has dropped from 18 percent to 12 percent
(not including the ICU, where urinary catheters are
more frequently needed).
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Healthcare Reform
and Accountable Care:
Where Do We Stand?
The Issues
The term “healthcare reform” means many different
things to many different people. Over the past several
years, it has taken on added significance as President
Obama has advanced plans to restructure healthcare
delivery and make changes to how facilities are
reimbursed for care.
Although many disagree on whether reform as currently
envisioned addresses these issues properly, it is generally
agreed on both sides of the political aisle that real reform must
reduce costs, improve the quality of care and improve the health
of the population. In short, we must create payment models that
reward value and not volume.
on the subject of accountable care. TDI was founded in 1988
by Dr. John E. Wennberg as the Center for the Evaluative
Clinical Sciences (CECS). Over the years, TDI has established
a new discipline and educational focus in the evaluative clinical
sciences, introduced and advanced the concept of shared
decision-making for patients, demonstrated unwarranted
variation in the practice and outcomes of medical treatment,
and shown that more healthcare is not necessarily better care.
“By demonstrating a healthy skepticism
about new treatments and medical
breakthroughs, investigating the risks
and benefits of many common therapies
and surgeries, and offering unique
educational programs, TDI has produced
more informed agents of change among physicians, health
professionals, the media and the public,” said Todd Ebert
Amerinet president and CEO.
Overall do you view the ACO as...
50
42 (67%)
40
30
The common thread binding the foundations of reform is the
idea of accountable care, which can be defined as a group
of healthcare providers working together to assume shared
accountability for the quality and cost of the care they provide to
their community, with an overall focus on improving healthcare
value. Moving to an accountable care model is a bold strategic
initiative designed to position an organization for long-term
success … in an uncertain future operating environment. This
new, value-based system, is built around the integration and
cooperation of providers who manage a population through
team-based care. To do this, incentives must be aligned, and
all stakeholders must focus on quality, efficiency and value.
20
11 (17%)
9 (14%)
10
1 (2%)
0
Not positive
at all
Somewhat
negative
Somewhat
positive
Very
positive
How extensively has your organization
(and collaborating payers and providers)
considered implementing an ACO?
50
49 (80%)
40
Against this backdrop, the 2011 Amerinet Executive Roundtable
and corresponding survey sought to gather feedback and
enhance knowledge concerning attitudes toward healthcare
reform and accountable care.
30
20
11 (18%)
10
Amerinet engaged The Dartmouth Institute for Health
Policy and Clinical Practice (TDI) to moderate the roundtable
session and share nearly 40 years of research and information
1 (2%)
0
Currently
implementing
Planning
for potential
implementation
Currently
exploring
Chart data from Amerinet Survey
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In terms of the Amerinet Executive Roundtable survey,
respondents expressed a negative opinion about healthcare
reform, which appears to be mainly due to the uncertainty and
lack of direction surrounding it. Respondents were more positive
about the general concept of ACOs, with more than 80 percent
considering the implementation of an ACO.
“The issue of healthcare reform is
somewhat negative because assessing
the real impact to consumers and
providers is extremely difficult. While
ACO’s have been touted as a step
towards trying to manage the population’s
health, the current proposed regulations will make it very
difficult for providers to participate, with the risks great and the
rewards small,” said John Matessino,” president and CEO of the
Louisiana Hospital Association.
“Through the ACO, we have the opportunity
of putting providers back into the role of
creating some solutions to help deal
with the overall cost and quality of care
and the fragmentation of care. With
the ACO, we also begin to look at the
appropriate utilization of scarce resources and access to those
resources,” said Kevin Schoeplein, executive vice president,
OSF Healthcare System.
What became abundantly clear during the roundtable session
was that whether ACO models take hold or not, the theory of
accountable care – using systematic efforts to improve quality
and reduce costs across the organization by addressing
key issues such as capacity, patient engagement, process
improvement and physician alignment – is essential for the
survival of any healthcare organization in the future.
Further illustrating the points to the left, the Amerinet survey
asked member executives to identify their top priorities over
the next two years (2011 and 2012). Their most frequent
responses included:
•
•
•
•
Meaningful use – 43 percent
Physician alignment – 26 percent
Quality – 22 percent
Cost containment – 18 percent
Other pressing issues included possible facility expansion,
evaluation of service lines and physician recruitment. Among the
highest impact healthcare trends identified were reimbursement
cuts and episode of care/bundled payment options. The
biggest drivers of healthcare costs centered on labor costs,
overutilization of services and government laws.
With this in mind, TDI offered three possible scenarios
for the future of healthcare:
Choice A
Choice B
Choice C
The care model
remains unchanged
and costs continue
to spiral
Coverage expands,
the care model evolves,
and reimbursements
are slashed
The care model is
transformed, quality
improves, unwarranted
variation is addressed,
and cost is controlled
Choice A is the “do nothing” approach. It means that there
will be no payment reform and costs will continue to grow from
10-16 percent of GDP (twice the rate in other developed countries,
with equivalent or better outcomes), eventually spiraling up to
30 percent of GDP. The result will be a bankrupt economy.
Choice B shows that there will be limited reform that includes
expanded coverage with no way to pay for it. This will result in
slashed reimbursements and financial losses on every patient.
The industry will react to these changes by getting more efficient
and seeking out the procedures where reimbursement is
profitable. Healthcare will survive, but on life support with
almost no financial flexibility.
Choice C is to reinvent the care model entirely. This
includes understanding unwarranted variation in supply
sensitive care to identify and eliminate waste; implementing
shared decision making for patient-centered care; using
comparative effectiveness research to identify and increase
the use of effective care; dramatically increase the quality of
care as measured by patient reported outcomes; and increase
employee and patient satisfaction along the way.
“Choice C is really about transforming
the care model. We want to improve
the quality of care, reduce unwarranted
variation and control costs. This is the
heart of the accountable care concept.
Of all possible solutions, Choice C offers
the most comprehensive approach to addressing our national
priorities, as well as the economic trends and cost drivers,” said
Craig Westling, M.S., M.P.H., managing director of Accountable
Care and of the Office of Professional Education and Outreach
at The Dartmouth Institute for Health Policy and Clinical
Practice. “We don’t think that ACOs are the only solution –
other innovative models emerge, too. But all the models will
address the same core issues, and will ultimately result in
‘accountable care.’”
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This new approach would feature providers driving care
improvement through:
• Care coordination
• Shared risk and rewards for cost and quality outcomes
• Transparent reporting of metrics, ensuring a continuous focus
on improvement
• Freedom of beneficiary choice, so patients will be free to seek
care from any provider
Echoed Mina Ubbing, president and CEO,
Fairfield Medical Center, “I think that the
ACO has the very high potential of putting
the patient back into the equation. We’re
managing every other aspect through
legislation and so on. And even though
there’s certainly a lot of legislative risks with healthcare reform
and specifically ACOs, it still gives us a chance to make sure
that the providers are doing the right things for their patients.”
What is an ACO?
On March 31, 2011, The Department of Health and Human
Services (HHS) released for public comment the long-awaited
proposed rules governing accountable care organizations. In a
fact sheet accompanying the 413 page document, HHS said,
“ACOs create incentives for healthcare providers to
work together to treat an individual patient across care
settings – including doctor’s offices, hospitals and
long-term care facilities. The Medicare Shared Savings
Program will reward ACOs that lower growth in healthcare
costs while meeting performance standards on quality
of care and putting patients first. Patient and provider
participation in an ACO is purely voluntary.”
Further detailing the rationale behind ACOs, HHS said,
“Today, more than half of Medicare beneficiaries have five
or more chronic conditions such as diabetes, arthritis,
hypertension and kidney disease. These patients often receive
care from multiple physicians. A failure to coordinate care
can often lead to patients not getting the care they need,
receiving duplicative care and being at an increased risk of
suffering medical errors. On average, each year, one in seven
Medicare patients admitted to a hospital has been subject to a
harmful medical mistake in the course of their care. And nearly
one in five Medicare patients discharged from the hospital is
readmitted within 30 days – a readmission many patients could
have avoided if their care outside of the hospital had been
aggressive and better coordinated.”
Improving coordination and communication among physicians
and other providers and suppliers through ACOs will help
improve the care Medicare beneficiaries receive, while also
helping lower costs. According to the analysis of the proposed
regulation for ACOs, Medicare could potentially save as much
as $960 million over three years.
Several characteristics that will be essential for all ACOs:
• Managing the continuum of care for patients as a
real or virtually integrated delivery system
• Being of sufficient size to support comprehensive
performance measurement and expenditure projections
• Having the capability of internally distributing shared savings
and prospectively planning budgets and resource needs
“As we move forward in terms of who
the ACOs are, two things are really
important: (1) Physician involvement, and
(2) being community based. I know a lot
of organizations are trying to pre-position
themselves just because of who they are.
So they might say, ‘We are the insurance company,’ ‘we are the
hospital,’ ‘we are the physician group.’ And actually, what it’s
going to require, I think, is an inclusiveness of all those parties
to make it happen,” said Larry A. Mullins, president and CEO,
Samaritan Health Services.
Westling echoed those thoughts by adding, “CMS is not going
to let anybody just repackage what they’re doing and call it an
ACO. You’ve got to really show that you’re transforming care.”
Key elements associated with accountable care models:
Local Accountability
• Fostering provider accountability for quality and per
capita cost for patient population
Standardized Performance Measurement
• Increasing accountability on the part of providers should
be accompanied by improved incentives and information
for consumers
Payment Reform
• Transitioning payments from rewarding volume/intensity
to increasing value
• Restructuring payments to encourage collaboration and
shared responsibility among providers and consistent
incentives from payers
Dr. William Weeks, associate professor of Psychiatry and of
Community and Family Medicine at Dartmouth Medical School
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and associate professor and course
director at TDI, explained a key area of the
local accountability concept will be a firm
grasp of local healthcare utilization patterns.
“First we have to understand, Who are the
patients? Who is it we’re talking about?
And then we have to understand, What are their utilization
patterns? And then we have to provide higher value by altering the
processes, structures and outcomes of the care we provide.”
Continued Craig Westling, “Local accountability is why the
concept of ACOs has bipartisan support. Ultimately it’s about
figuring out what works in your town. A key thing here is
standardized performance measurement around quality and cost.
CMS needs to create some level of standardized, transparent
metrics so we can compare programs across the country.”
The ACO model establishes a spending benchmark based on
expected spending. If an ACO can improve quality while slowing
spending growth, it receives shared savings from the payers.
ACO-specific expenditure benchmarks will be based on historical
trends and adjusted for patient mix. Contingent on meeting
designated quality thresholds, ACOs with expenditures below
their particular benchmark will be eligible for shared savings
payments, which can be distributed among the providers within
the ACO. These shared savings allow for investments – in health
IT or medical homes, for example – that can in turn improve care
and slow cost growth.
How Do “Shared Savings” Models Work?
How Do ACOs Achieve Results?
What will be the measure of success for an ACO?
CMS had defined five measurement domains with
a total of 65 measures.
Clearly, healthcare IT will be one of the foundational building
blocks of accountable care. This is true from a coordination of
care and ease of information sharing perspective, and also in the
sense of using data to maximize results. Leveraging technology
for business intelligence and modeling to predict use patterns will
be important to proactively manage continuums of care.
“Without the data, we can’t get the information we need to
manage care,” said Westling. “We need the ability to know our
community so we can assess risk and prevent illness before we
see it in an acute setting.”
“In terms of processes, there must be improved care
coordination to reduce variation and waste. Up to 60 percent
of the CMS spending goes towards chronic care. Overall,
we’re trying to reduce waste … and a primary driver of costs is
redundancy, so part of that coordination of care is eliminating
unwarranted variation and providing the right care at the right
place at the right time, every time,” continued Westling.
65 Performance Measures
Grouped into 5 equally weighted domains
Domain/
Sub-Category
Measures
Data Source
7
Survey
16
Claims/
Clinical Data
Patient Safety
2
Claims
Preventive Health
9
Clinical Data
At-Risk Population
Diabetes
Heart Failure
Coronary Artery Disease
Hypertension
COPD
Frail Elderly
31
Claims/
Clinical Data
Initial shared savings derived from spending below benchmarks
Patient/Caregiver
Experience
Care Coordination
• Care Coordination
• Care Transitions
• Coordination
Information Systems
Model data courtesy of The Dartmouth Institute
The ACO model is addressing payment reform by moving away
from volume into increasing value. “The movement toward
collaboration carries a lot of risks, but it’s actually the only way
that this will work,” said Westling. “The idea is to improve the
value of care delivered. And I think it’s an important distinction.
There’s obviously a lot of lingering bitterness toward managed
care and HMOs in the past because too many decisions were
based on cost. In ACOs, the quality piece is just as important as
the cost piece. If you don’t meet your quality metrics, you’re not
going to reap major savings.”
•
•
•
•
•
•
Table data courtesy of The Dartmouth Institute
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What You Can Work on Right Now
Whether or not healthcare organizations take the
leap into joining or becoming an ACO, there are
several things that any size and type of healthcare
organization can do to prepare themselves for success
in the upcoming era of value-based payment reform.
Healthcare facilities must take a critical look at their
operations in terms of the following areas:
In regions where there are more intensive care unit beds, more
patients will be cared for in the ICU. More specialists will result in
more visits to specialists.
In regions where there are relatively fewer medical resources,
patients get less care; however, there is no evidence that these
patients are worse off than their counterparts in high-resourced,
high-spending regions. Patients do not experience improved
survival or better quality of life if they live in regions with more care.
In fact, the care they receive appears to be worse.
Leadership
Administrative leaders
Clinical leaders
Patients
Informed patient choices
Health risk assessments
They report being less satisfied with their care than patients in
regions that spend less, and having more trouble getting in to
see their physicians.
Partnerships
Payers
Community-based
organizations
Physicians
Aligned incentives
Access to timely data
Provider groups
Information Technology
Ability to support
ACO operations
Most studies have found that mortality is no better in highspending regions, almost certainly because the benefits to
some patients are counterbalanced by the harms to others.
Hospitals can be dangerous places, where patients face the
risk of medical error, adverse events and hospital-acquired
antibiotic-resistant infections. As more physicians get involved
in a patient’s care, it becomes less and less clear who is
responsible, and miscommunication and mistakes become
more likely. Greater use of diagnostic tests increases the risk of
finding – and being treated for – abnormalities that are unlikely
to have caused the patient any problem. Patients who receive
care for conditions that would have never caused a problem can
only experience the risk of the intervention.
Processes
Improved care
coordination
Capacity
Appropriate workforce
Chronic disease
Reduction/conversion
management
of current capacity
Point of care reminders
Reduced waste
Health information
technology
Next, organizations can start working on the following
activities, even with current resources:
Statistical Analysis – Assessing utilization patterns to
find best practices and address supply-sensitive care.
Supply-sensitive care also accounts for more than half of all
Medicare spending. Understanding the problem of supplysensitive care is a critical first step toward improving the quality
and affordability of healthcare, building organized delivery
systems and scaling back costs and cost growth.
Shared Decision Making – Helping patients make informed,
evidence-based choices about preference-sensitive care.
Shared Decision Making
Microsystem Strategies – Improving clinical quality and
to increase utilization of effective care.
Comprehensive Care Centers – Improving coordination
of care, support the efficient use of healthcare resources.
Shared decision making is the collaboration between patients
and caregivers to come to an agreement about a healthcare
decision. It is especially useful when there is no clear “best”
treatment option.
Statistical Analysis
The caregiver offers the patient information that will
help him or her:
According to the Dartmouth Atlas, supply-sensitive care
refers to services where the supply of a specific resource
has a major influence on utilization rates. The frequency of
use of supply-sensitive care is largely due to differences in local
capacity, and a payment system that ensures that existing
capacity remains fully deployed. Simply put, in regions where
there are more hospital beds per capita, patients will be more
likely to be admitted to the hospital.
• Understand the likely outcomes of various options
• Think about what is personally important about the risks
and benefits of each option
• Participate in decisions about medical care
“This is probably the most important thing when it comes to the
right thing to do. This is where it’s not just informed consent,
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this is where patients are understanding what their options are,
and what the consequences of each decision might be. And
then, making a fully-informed decision that is aligned with their
values. Patients are then invested in their decisions and in the
care that they receive. That is treating the patient in the right way.
Doing this kind of thing is what’s going to make everything else
flow better,” explained Westling.
Microsystem Strategies
A microsystem in healthcare delivery can be defined as a small
group of people who work together on a regular basis to provide
care to discrete subpopulations including the patients. It has
clinical and business aims, linked processes, shared information
environment and produces performance outcomes. They evolve
over time and are (often) embedded in larger organizations. As a
type of complex adaptive system, they must do the work, meet
staff needs and maintain themselves as a clinical unit.
Clinical microsystems are the front-line units that provide most
healthcare to most people. They are the places where patients,
families and care teams meet. Microsystems also include
support staff, processes, technology and recurring patterns
of information, behavior and results. Central to every clinical
microsystem is the patient.
The microsystem is the place where:
• Care is made
• Quality, safety, reliability, efficiency and innovation are made
• Staff morale and patient satisfaction are made
Microsystems are the building blocks that form hospitals
and clinics. The quality of care can be no better than the quality
produced by the small systems that come together
to provide care.
All healthcare professionals – and we believe all front-line clinical
and support staff are professionals – have two jobs: Job 1 is to
provide care. Job 2 is to improve care.
For instance, if someone says ‘most of the time,’ what does that
mean? Does it mean 51 percent? 96 percent? Or when looking
at variation, people need to understand when to intervene in a
process. What kind of variation is just normal in this process?
Don’t intervene until you have an outlier that indicates a real issue.
Because sometimes the most damaging thing you can do is
tamper with something that doesn’t need an intervention. That
potentially creates a whole new slew of problems. The bottom line
is that it’s really important to use a common language throughout
an organization, and to make it easy to understand.”
Dr. Charles Sorenson, president and
CEO, Intermountain Healthcare, offered,
“Something that’s given us significant
traction in quality improvement over the
past 12 or so years is our extended senior
management team having accountability
to our board for the accomplishment of specific goals in
clinical quality improvement, along with the other goals set
by the board. It’s no longer just the doctor’s job, or the chief
nursing officer’s job or somebody else’s job. Reviewing those
goals is one of the first things we do when we meet with our
regional operators – not just review the finance or the building
program, but ask, ‘Where are you in your clinical quality, your
patient safety goals?’ And that has helped also in terms of our
alignment with physicians, because I’ve always felt that the
most important component of learning with physicians has to
be a shared understanding of our outcomes, and how we can
improve them.”
Comprehensive Care Centers
“The idea behind comprehensive care centers is that you’re
putting the patient at the center through the entire continuum
of care, from education in the community, tools for the primary
care providers, to help the patients make informed decisions.
And then if the decision is made to have surgery, it’s really wellcoordinated throughout the hospital and follow-up. Medical
home is a similar concept built around the primary care
physician as care coordinator,” said Westling.
Finding time to improve care can be difficult, but the only way to
improve and maintain quality, safety, efficiency and flexibility is by
blending analysis, change, measuring and redesigning into the
regular patterns and the daily habits of front-line clinicians and
staff. Absent the intelligent and dedicated improvement work by
all staff in all units, the quality, efficiency and pride in work will not
be made nor sustained.
The medical home concept is one in which patients are cared
for by a primary care physician who leads the medical team
coordinating all aspects of preventive, acute and chronic needs
of patients.
Explained Westling, “You don’t have to get super-fancy or
complicated with any performance improvement methodology.
People need just a fundamental understanding of the concepts.
The American Academy of Pediatrics (AAP) introduced the
medical home concept in 1967. In 2007, the AAP, American
Academy of Family Physicians, American College of Physicians
and American Osteopathic Association released the Joint
Principles of the Patient-Centered Medical Home.
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Among the main principles listed were:
Physician directed medical practice – The personal
physician leads a team of individuals at the practice level who
collectively take responsibility for the ongoing care of patients.
Whole person orientation – The personal physician is
responsible for providing for all the patient’s healthcare needs
for all stages of life and taking responsibility for appropriately
arranging care with other qualified providers.
Care is coordinated and /or integrated across all elements
of the healthcare system and the community, care is facilitated by
registries, information technology, health information exchange
and other means to assure that patients get the indicated
care when and where they need and want it in a culturally and
linguistically appropriate manner.
Quality and safety are rooted in:
• Evidence-based medicine and clinical decision-support tools
guide decision making
“The medical home model is one of the pilot projects that’s out
there right now to actually enroll the most at-risk populations to
see how effectively they can be managed, and what the cost of
care is,” said Dr. Larry Mullins, president and CEO of Samaritan
Health, whose organization recently undertook a pilot project
in the development of a medical home concept. “In our case,
we took the highest cost population we could find. Because we
thought if we’re going to make a difference anywhere let’s start
with that.”
Regardless of an organization’s urgency in exploring the
possibilities of ACO participation, there are a number of things
they can do to assess their actual readiness.
“From an organizational perspective you need to think about
who is going to be on the leadership team. And you need
to think about who’s participating: which physicians are
participating, which practices are participating, which payers will
be your best partners,” said Westling.
• Utilization of information technology support optimal patient
care, performance measurement, patient
education and enhanced communication
In addition to executive leadership, the involvement and buy-in
of physicians is key. The new model must promote physician
engagement at every level. Clinical and executive leadership must
demonstrate they have a shared mission and vision or success
of the accountability model. These objectives must also include
programs of compensation and incentives that are viable internally
among providers, but also must be aligned among all payers.
Enhanced access to care is available through systems
such as open scheduling and expanded hours.
“Involvement in the quality improvement process is a great satisfier
for most doctors. They no longer have to rely on how much
• Accountability for continuous quality improvement
through performance measurement and improvement
• Active participation by the patient in decision-making
Which of the following stipulations for ACOs (listed by CMS)
does your organization currently have in place?
40
37 (59%)
28 (44%)
30
25 (40%)
23 (37%)
19 (30%)
20
11 (17%)
7 (11%)
10
4 (6%)
0
A formal legal
structure to
receive and
distribute
shared
savings to
participating
providers
Minimum
of 5,000
Medicare
beneficiaries
required
per ACO
At least
three years
of participation
Leadership and
management
structure
that includes
clinical and
administrative
systems
Processes
to promote
evidence-based
medicine
Report on
quality
Report on
cost measures
Requirement
to produce
reports
demonstrating
the adoption
of patient
centered care
Chart data from Amerinet Survey
ADVERTISEMENT
money they make to figure out whether they’re being successful,
but can see on objective indicators that they are accomplishing
results for their patients that are on a level of the very best reported
any place in the world. And that brings a whole lot of professional
satisfaction. I think that becomes an important way to inspire and
retain good clinical people,” said Sorenson.
The results of the Amerinet survey bear out some of the basics
that must be in place. More than 44 percent of respondents
said that they had implemented a leadership and management
structure that included clinical and administrative systems.
In terms of infrastructure, a high number of respondents
(59 percent) were reporting on quality and 37 percent were
reporting on cost measures. A relatively high number had also
implemented processes to promote evidence-based medicine.
Where respondents seem to be lagging is in the area of care
coordination (only 11 percent reported the ability to produce
patient-centered care reports) and the structure for payments
for shared savings distribution (17 percent).
For many Amerinet members in the rural healthcare setting,
many questions still linger and may as of yet be unresolved.
“I’m concerned we’re talking about too many physicians in
populated areas. Well, I’m in a rural area. I can’t attract a
physician to the rural area. Where are
small hospitals, the communities and the
patients going to receive care?” asked
Bob Miller, CEO of Coshocton Hospital.
Indeed, some of the challenges facing
smaller, less integrated providers include
the degree to which potentially burdensome requirements for
participation are phased in or modified for rural or less integrated
ACOs and how bonuses and performance thresholds are
structured to encourage participation by less well-established
provider groups (e.g. rural providers, FQHCs, RHCs).
Although, because of consolidation and collaboration, capacity
will shrink and some providers may be closed or absorbed by
other entities, some see promise for rural providers.
“Rural areas do have better outcomes with fewer resources,” said
Weeks. “I think where they might have a bit of an advantage is
that they have been providing higher value care for a pretty long
time. So if I’m a company and I want to increase my earnings
per share, I buy a company that’s got better earnings per share
than me. If I’m a provider and I want to get greater cost shared
savings I might buy or affiliate with someone that’s got lower
costs overall and better outcomes.”
What Now…
Contact
So what are providers to do at this point? Should they jump in with both feet, slowly test the
waters or ignore it and hope it goes away? History shows that when Medicare funds a program,
it often has a significant impact on care delivery and provider focus. The idea of accountable
care seems to be the latest example.
At its core, the concept, although idealistic, is grounded in goals
and objectives that are keys to future success in healthcare:
A strong emphasis
on quality and coordinated
care, with integration of
community resources
Leveraging technology
and using predictive
modeling to identify
high risk individuals
Enhancing
transparency
measures
A final statement by one of the meeting participants may sum up the current situation best.
“Just as we bring this to a close, I think all of us who have been in the business for a long time have gone
through a lot of iterations of healthcare reform. About every 10 years we have healthcare reform. I think t
he beauty of what we’re seeing now is – we talked all day long about collaboration – the fact that we now
have a lightning rod that is forcing us all to focus on some key issues. And collaboration is going to occur.”
Amerinet Customer Service
877-711-5600
[email protected]
About Amerinet Inc.
As a leading national healthcare
solutions organization, Amerinet
collaborates with acute and
non-acute care providers to
create and deliver unique
solutions through performance
improvement resources,
guidance and ongoing
support. With better product
standardization and utilization,
new financial tools beyond
contracting and alliances
that help lower costs, raise
revenue and champion quality,
Amerinet enriches healthcare
delivery for its members and the
communities they serve. To learn
more about how Amerinet can
help you successfully navigate
the future of healthcare reform,
visit www.amerinet-gpo.com.
36
Navigating
the
Regulatory
MaZE
Recognizing the risks associated with an increasingly
complex regulatory environment, providers are heading
off potentially devastating fallouts by allocating time,
attention, and capital to compliance efforts.
38
Even as they make major investments in care delivery
changes and absorb reimbursement cuts, providers
are having to devote scarce resources to complying
with ICD-10, RACs, HIPAA, Stark, and numerous other
regulations and enforcement efforts.
Many of these regulations promise to protect
patients, as well as providers and payers, from fraud,
data breaches, or other unintended harm. Others are
designed to enhance transparency around quality and
costs or improve clinical and claims reporting.
It’s hard to argue with these goals. But the devil is
in the details, as they say, especially for providers that
have to ensure that they dot every “i” and cross every
“t” to avoid potential financial penalties associated
with noncompliance.
The answer, according to the providers in this
section, is preparation and vigilance.
Case Study: Preparing for ICD-10
When Deborah Beezley, director of health information
management at St. Anthony’s Medical Center in
St. Louis, invited hospital managers to a meeting
about a new medical coding system, she knew how
to get their attention.
Her message: Healthcare providers that do not adopt
the new coding system by Oct. 1, 2013, will be unable
to submit claims or receive payments from government
or private payers.
“It was one of those situations where I sent an email
out and people listened,” she says.
Everyone invited to that December 2010 kickoff
meeting for St. Anthony’s implementation of the ICD-10
coding system showed up, and the hospital is now
nearly through the first of a four-phase, three-year
roadmap to hit the 2013 deadline.
>>
Common Approaches
While the four case studies in this section focus on
divergent regulatory requirements, some commonalities
can be found in the providers’ approaches.
>>Driving compliance in a top-down fashion with senior
leaders providing visible and frequent support
>>Focusing on how a regulation coincides with the provider’s
quest to improve quality and reduce costs
>>Devoting dollars, staff, and time to the compliance effort
>>Collaborating directly with regulatory or enforcing
agencies, when necessary, to determine the most
appropriate response
>>Studying how the regulation is being enforced—and how
other providers are being affected
>>Enlisting key stakeholders from service lines, departments,
and units affected by the regulation in developing a
multidisciplinary compliance approach
>>Developing organization-specific policies and procedures,
training materials, and other tools to help ensure
compliance
>>Using risk analysis and root-cause analysis to determine
how the organization may be at risk of noncompliance—
and/or determine targeted corrective actions to decrease
the likelihood of repeat problems
With all the other changes in the healthcare industry
in the next few years, it is unfortunate timing that
America’s diagnostic and procedure classification
system must be overhauled at the same time. But
the deadline has been postponed repeatedly, and
knowledgeable providers know better than to expect
additional delays.
The ICD-10 medical coding system, endorsed by the
World Health Organization in 1990, has already been
implemented by virtually every other industrialized
nation. The United States has continued to use ICD-9,
but that system is running out of numeric capacity to
expand and can no longer adequately support the
information needs of today’s healthcare system.
The ICD-10 system has more than 68,000 medical
codes, compared to about 13,000 in the current ICD-9
coding system. But the scope of implementing ICD-10
is far greater than simply mastering new codes; the
new system will affect a vast array of financial and
operational processes, requiring careful preparation
by a wide group of stakeholders.
That is why St. Anthony’s CFO John Skeans advises
hospital leaders to realize this issue cannot be postponed. “If you haven’t begun the process of planning
and implementation for ICD-10, begin now and expect
to be playing catch-up.”
39
Managing information system
resources. Like many hospitals,
St. Anthony’s is adopting a new
electronic health record (EHR)
this year, which is obviously a
top priority for IT staff. Adopting
the ICD-10 coding system will
also require significant IT support,
so planning ahead is essential to
ensure staff resources are available.
HIM
compliance
and risk
management
Stakeholders
Management
of impact
to revenue
cycle
Operations
and workflow
change
Industry
payers and
third parties
Center for
Clinical
Effectiveness
Tasks
* DMAIC = Define, Measure, Analyze, Improve, and Control
Source: St. Anthony’s Medical Center, St. Louis, Missouri. Reprinted with permission.
Capital and operational budget for ICD-10 conversion.
Beezley’s first step—almost a year ago—was to create
St. Anthony’s goal is to have the ICD-10 conversion
a 10-page executive summary designed to educate
budget in place by December 2011. In addition to
St. Anthony’s senior leaders about the importance and
IT costs associated with the conversion, Skeans is
scope of the ICD-10 implementation.
budgeting for a long list of internal costs, including
Those top leaders are key to maintaining the visibility
NN Staff training
of the ICD-10 project as an organizationwide priority.
NN Extra labor costs (e.g., temporary staff) to support
“During regular monthly manager meetings and leadercoding staff while they are being trained and gaining
ship retreats, they continue to mention and discuss
experience with the new codes
this project as a critical milestone that has to be met,”
NN Legal costs involved in updating vendor contracts
says Beezley.
to ensure they comply with the new coding system
CFO Skeans monitors the ICD-10 project’s progress
NN Updated encoding software
on a monthly basis and ensures that Beezley’s team has
NN Costs of modifying information services systems
the support it needs from senior leadership.
to accommodate new code sizes
The purpose of the kickoff meeting for about 45 senior
NN ICD-10 coding books and resources, such as
leaders and managers was to engage the support of
anatomical software or charts, that coders will
leaders in meeting the 2013 deadline. Just because the
need to code with greater specificity
coding change has been anticipated for decades does
not mean it was on everyone’s radar screen. “It was
“These costs equate to additional expenses
really amazing to me how many ancillary and support
at the same time we are experiencing decreased
department directors were unaware of the change that
reimbursement,” he says.
was coming,” says Beezley.
“It became one of those
ICD-10 Stakeholders and Tasks
big eye-openers for our facility.”
St. Anthony’s ICD-10 steering
committee includes representatives
Physicians
from all departments that will be
and
clinicians
affected by the coding change,
including patient accounting, risk
Managed
Establish
Information
care, patient
management, information services,
coding
Policy and
services
accounts, and
measures
procedure
finance
and clinical operations (see the
using DMAIC*
management
exhibit on this page).
Beezley asked each department
Change
Training
management
Integrated
head to assign individuals to the
of coders
testing
steering committee who have
Stakeholders
Vendors,
Marketing
experience in change management
clearinghouses,
and ancillary
coming together
and suppliers
services
and understand revenue cycle issues.
for the patient
Among other things, the steering
Ongoing
Software
clinical
committee ensures that several
changes and
documentation
upgrades
education
overarching considerations are
being addressed.
Getting started
40
“If you haven’t begun the
process of planning and
implementation for ICD-10,
begin now and expect to
be playing catch-up.”
Education and training. Because the new codes are
more numerous and more specific, medical coders
are likely to need additional basic education about
anatomy, physiology, pharmacology, and surgical
procedures in addition to training on the new codes.
In addition, physicians and nurses will need to
be trained to provide more specific documentation
to support the new codes. Other staff requiring jobspecific ICD-10 training include those in the patient
financial services, patient access, scheduling,
compliance, and legal departments.
Data reporting and exchange. Medical codes underlie
many data-driven functions and reporting, such as
business intelligence and decision support, performance
metrics, claims billing, clinical research projects, and
tumor registries, says Beezley. “A personal concern that
I have is how the ICD-10 conversion is going to affect
reports and outside data transfers,” says Beezley.
Thus, St. Anthony’s ICD-10 steering committee is paying
close attention to ensure that the coding conversion
does not jeopardize any ongoing data collection,
analysis, and reporting.
Engaging stakeholders
While those hospitalwide concerns are being
addressed, Beezley is systematically going department
to department to help managers think through how
the ICD-10 implementation will affect all aspects of
their operations.
During hour-long interviews with about 25 departments that use medical codes, Beezley is asking a
series of questions designed to uncover specific ICD-10
to-do items related to training, software conversions,
internal and external reporting, and budget needs.
Responses are recorded in a detailed spreadsheet that
will be used to create the work plan for a smooth
conversion to the new system.
“This is a good time to stress one-on-one with
each department what exactly is needed to implement
ICD-10,” she says. “People are beginning to understand
the critical nature of this initiative, and we are gaining
tremendous input into what we need to accomplish to
ensure a successful conversion.”
Case Study: Avoiding HIPAA Violations
Like every good healthcare compliance officer, George
Rousis at Halifax Health, a two-hospital system in
Daytona Beach, Fla., has his eyes trained on the U.S.
Office of Civil Rights (OCR).
The OCR, responsible for enforcing provisions of
the Health Insurance Portability and Accountability Act
(HIPAA), has been very busy this year. As of mid-July,
it had issued three enforcement actions against health
systems, each of which had big dollars attached.
In comparison, there were only two enforcements in
2010, and just one in each of the two previous years.
This is just the beginning. A recent audit of seven
hospitals by the U.S. Office of the Inspector General
(OIG) found so many security problems related to
electronic patient health information that the OCR has
launched investigations into each hospital. In response
to the OIG’s scathing report of security oversight,
the OCR has contracted with a consultant to conduct
150 audits of hospitals and other covered entities
by the end of 2012.
Halifax Health, which has some 4,000 employees
who can potentially access patient information, has not
had a formal complaint lodged against it in two years.
However, the health system has been contacted by the
OCR six times in eight years to investigate complaints.
Despite these interactions, Rousis is not nervous about
the agency’s stepped-up enforcement activity. “I have
never dealt with an investigator who I thought was
totally unreasonable,” he says.
However, Rousis believes the OCR’s new aggressiveness sends a message to all providers: HIPAA compliance
must be a top priority.
Understanding the risks
OCR is responsible for enforcing the HIPAA privacy
rule, which protects the privacy of personal health
information that identifies individuals, and the HIPAA
security rule, which sets standards for the security of
electronic health information.
Health systems must perform a risk assessment
to ensure they are in full compliance with the HIPAA
security rule, although the frequency and scope of
those assessments is not specified in the rule. A risk
assessment is also required for EHRs to meet the
Stage 1 meaningful use criteria.
41
“CEOs need to know
what is in the HIPAA
enforcement cases, and
then ask the question:
‘Could this happen to us?’ ”
Recent OCR Enforcement Actions
>>The OCR’s first enforcement action against a health
system, back in 2008, stemmed from staff members at a
Seattle-based health system taking laptops containing
patient information offsite, where the laptops were lost
or stolen
>>A Massachusetts physician organization paid $1 million
to settle with the OCR after an employee left patients’
billing information on a subway train
>>A university-based health system settled for $875,000
after staff members inappropriately looked at the health
records of celebrities
>>A Maryland payer made its first mistake when it denied
patients access to their medical records, which drew
a $1.3 million penalty; its second error was refusing
to cooperate with the OCR’s investigation, earning an
additional $3 million penalty for its negligence
Learning from others
While compliance officers are working to protect their
organizations against theoretical HIPAA violations,
healthcare executives should familiarize themselves
with actual cases that resulted in financial settlements
or penalties. Rousis urges top leaders to read the
OCR’s enforcement actions (available on the OCR
website) because these cases document how poor
judgment by staff members can turn into huge
payouts by health systems.
“CEOs need to know what is in the HIPAA enforcement cases, and then ask the question: ‘Could this
happen to us?’” says Rousis. “If I was a CEO, I would
want to know what my organization is doing to prevent
similar breaches of personal health information.”
Hospital executives should also study the OIG
report that prompted the government to initiate its
new audit program. In the OIG’s audits of seven large
hospitals, 151 “vulnerabilities” were identified, of
which 124 were categorized as high impact. These
included unencrypted laptops and portable drives that
contained personal health information, outdated antivirus
software, unsecured networks, and the failure to detect
rogue devices intruding on wireless networks (OIG,
Nationwide Rollup Review of the Centers for Medicare
& Medicaid Services Health Insurance Portability and
Accountability Act of 1996 Oversight, May 16, 2011).
“The OIG has already identified the security weaknesses found at hospitals during its own audits,” says
Rousis. “A good place to start is to have your team
look at those and report back how they are addressing
them in your own shop.”
In addition to the formal assessment that is conducted every few years, Halifax Health hires an outside
consultant to conduct reviews to ensure that its HIPAA
compliance plan is effective. “The risk assessment is
going to tell you where you are most vulnerable,”
says Rousis.
For example, a recent risk assessment identified
Halifax Health’s need to protect patient information that
could potentially leave the health system’s premises.
“Laptops, cell phones, USB flash drives, and all other
mobile devices—in addition to paper—that leave the
premises has become a high priority,” he says.
For that reason, Halifax Health is using encryption
technology to help ensure that patient-specific data
cannot be accessed on computers and mobile devices
in the event of a loss, theft, or other security breach.
In addition, Halifax Health has adopted policies that
prohibit employees from transmitting a patient’s
personal health information onto any device—either
corporate or personal—without encryption or other
safeguards. Staff are also being trained to understand
that they must have explicit approval from a supervisor
before they take or send any patient information off
the premises, such as to an external auditor or other
business associate.
The health system’s policy also delineates the
internal process for reporting and addressing possible
breaches of portable data, including how investigations
will be conducted. The policy requires an analysis of the
root causes behind the breach and implementation of
corrective actions that will decrease the likelihood of
a repeat problem.
The biggest challenge to complying with HIPAA
rules is the human factor, says Rousis. “This makes
administrative policies especially challenging to monitor
and enforce because you must rely on humans to do
the right thing, or be aware of when they are acting
imprudently,” he says. “With a technical safeguard like
encryption, you can obtain virtually absolute assurance
that information is inaccessible to anyone other than
the person that has the decryption key. But even
with encryption, we must rely on humans to set it
up properly, and keep their passwords secret.”
42
Case Study: Avoiding Anti-kickback
Violations When Partnering with Physicians
The opportunity to earn a 5 percent bonus through
an insurer’s pay-for-performance program intrigued
leaders at Borgess Medical Center in Kalamazoo, Mich.
But they knew the money would be earned only if the
hospital successfully engaged physicians in quality
improvement initiatives—and that sharing the bonuses
with physicians could risk violating the anti-kickback
and civil monetary penalty statutes.
These two statutes—along with Stark regulation—
are designed to discourage physicians from allowing
their personal financial considerations to influence their
decisions about patient care, including their referrals to
hospitals and other providers.
Borgess undertook a lengthy process of seeking an
opinion from the U.S. Office of the Inspector General
(OIG): Could Borgess create a structure that allows
medical staff physicians to share pay-for-performance
incentives without violating federal law?
OIG’s answer was yes—but that decision applies
only to Borgess and comes with specific requirements.
“You can use prior OIG opinions for guidance but
you can’t assume that if Organization A got an OIG
“It was a give and take
that was constructive
and respectful. it was
two parties working
together to come to
a solution.”
approval, then Organization B automatically gets the
same thing,” says J. Patrick Dyson, Borgess Health’s
executive vice president. “It’s probably advisable to
get your own opinion and play it safe.”
Seizing an opportunity
Since 2006, Blue Cross Blue Shield of Michigan (BCBSM)
has offered hospitals the opportunity to earn a bonus
of up to 5 percent on total inpatient, outpatient, and
rehabilitation payments if the hospitals achieve quality
and efficiency goals.
Borgess wanted to incentivize physicians to improve
the quality of care—and increase Borgess’ chance of
earning the pay-for-performance bonus—by allowing
the physicians the opportunity to share the money. The
hospital decided to create a limited liability company that
would, ultimately, be owned by participating physicians.
Pay for Quality
Borgess Medical Center created a limited liability corporation (LLC) that allows it to split the quality portion of its
pay-for-performance (P4P) award from Blue Cross Blue Shield of Michigan (BCBSM) with physicians who help meet
quality targets. The LLC may receive up to 50 percent of the total quality bonus from BCBSM. The formula is based
on the number of members as well as the hospital’s performance on quality-related metrics.
P4P $
Payer
MDs
Per capita
distributions
P4P contract
Hospital
Up to 50% of
P4P dollars
Source: Borgess Medical Center. Reprinted with permission.
Medical staff entry
At least 10 physicians
43
Getting the opinion
Winning the OIG’s approval for its plan required
considerable effort, but Dyson was pleased with the
experience and the result.
“It was a give and take that was constructive and
respectful,” he says. “It was two parties working
together to come to a solution.”
That said, getting the OIG approval took a long
time—and cost about $25,000 in legal fees. The hospital
started by submitting a proposal of how it wanted to
set up BQIP, based on its understanding of regulations
that govern relationships between hospitals and
referring physicians.
“The OIG identified some concerns and apprehensions,” says Dyson. “That enabled us to engage, through
our legal counsel, in direct discussion with the OIG,
saying, ‘Can we find ways to address your concerns?’”
One of the OIG’s concerns was that physicians
would be enticed to change their referral patterns
simply to participate in BQIP and share the potential
bonuses. For that reason, the BQIP documents
were written to require that physicians must be on
Borgess’ active medical staff for one year before
they can join BQIP.
Borgess also wanted to ensure the physicians
in BQIP were really pursuing quality improvement.
So each BQIP member must spend four hours a month
working on quality improvement initiatives at the
hospital. The quality indicators included in the BCBSM
program are all included in the Specifications Manual
for National Hospital Quality Measures, which includes
measures that have been approved by The Joint
Commission and the Centers for Medicare & Medicaid
Services (CMS).
Borgess changed the terms of its program over the
next 19 months. In October 2008, it became the first
hospital to receive OIG approval to split the financial
rewards of an insurer’s pay-for-performance program
with a broad group of physicians on its medical staff
who help Borgess achieve quality targets—and it
remains the only hospital to enjoy that status.
Building in safeguards
Today BQIP includes 26 physicians, each of whom
provided a $2,000 capital contribution to participate.
Additional physicians are expected to join this year,
says Dyson.
The hospital contracts with BQIP to share a
portion of quality incentives it receives (see the
exhibit on page 42). The physicians are eligible for
up to 50 percent of bonuses that Borgess receives
for quality performance, but—to ensure they are not
overly focused on cost-cutting—they can receive none
of the incentives that the health system receives for
efficiency measures, as per the OIG opinion.
The bonus money is distributed among BQIP
members based on the number of physicians in the
LLC, not based on the number of patients an individual
physician refers to Borgess. “This was a safeguard to
make sure somebody’s not motivated to shift volume
purely for the incentive,” says Dyson.
Case Study: Preparing for >
Value-Based Purchasing
Value-based purchasing is the government’s boldest
move yet to reward hospitals that provide high-quality
care—and penalize those that do not. Hospitals that
score well on 21 performance metrics that are publicly
posted on the Hospital Compare website (12 clinical
process measures and nine patient experience
measures) will receive incentive bonuses from CMS.
The catch: The program will be funded in its initial
year by a 1 percent DRG payment reduction. So any
hospital that does not earn a quality bonus will, in effect,
be financially penalized. In subsequent years, the DRG
payment reduction will gradually increase, while the
amount of the incentive payments and the number of
performance measures evaluated will also increase.
Ascension Health has calculated its financial risk
associated with CMS’s value-based purchasing program.
Based on a snapshot of its 70 acute care hospitals,
Ascension Health—which posts revenues of more
than $15 billion a year—might expect a financial hit of
about $928,000 when the CMS introduces value-based
purchasing in October 2012.
However, if just eight Ascension Health hospitals
improve their performance on quality measures and
patient satisfaction in 2012—and earn quality bonuses—
that small negative number could be turned into a small
positive, says David Pryor, MD, Ascension Health’s
chief medical officer.
The purpose of the company—Borgess Quality
Improvement Partners LLC, or BQIP—is to provide
opportunities for physicians to work on hospital quality
initiatives and to receive and distribute up to 50 percent
of financial rewards that Borgess receives for its performance on quality measures.
44
Focusing on the main issue
“The overall financial impact to Ascension Health will
likely be relatively small,” says Pryor. “But if you focus
only on the overall financial impact, you miss the
bigger picture.”
That bigger picture is that value-based purchasing
is just one of many government and private payer
initiatives that link quality to payment. The even bigger
picture, in Ascension Health’s view, is that improving
quality reduces a health system’s expenses, which may
have a much more significant impact on its financial
performance.
That is why the calculation of a potential $928,000 hit
from CMS’s value-based purchasing program does not,
in and of itself, drive an action plan. Rather, Ascension
Health continues to work its quality program for reasons
only strengthened by the theoretical CMS paycheck.
“The far more important issue is the organization’s
overall approach to improving quality,” says Pryor.
Like many health systems, Ascension Health internally reports Hospital Compare measures for all its
hospitals on a monthly basis, so leaders of each hospital
can see how they compare to one another and to national
benchmarks and work to improve on the facility’s
shortcomings. As shown in the exhibit below, Ascension
Health staff follow a continuous four-step process to
improve performance on Hospital Compare measures.
Value-Based Purchasing
React
to probable
changes in
measurement
and incentives
Identify
best
practices for
each process
measure
Monitor
performance
with internal
and external
tools
Implement
processes to
influence
improved
outcomes
Source: Ascension Health. Reprinted with permission.
“Fundamentally, we as
an organization believe
that good quality is also
good business.”
Calculating the financial benefits
Ascension Health launched an aggressive quality
initiative in 2003—well before payers were offering
financial incentives tied to quality—and is saving
1,500 lives each year because of it (Pryor, D., et al,
“The Quality ‘Journey’ at Ascension Health: How
We’ve Prevented at Least 1,500 Avoidable Deaths a
Year—and Aim to Do Better,” Health Affairs, April 2011,
pp. 604-611).
The health system started by choosing eight
priorities for action, developed a set of evidencebased interventions to address each of these priorities,
and disseminated the practices to all its hospitals. For
example, to reduce the incidence of pressure ulcers,
Ascension Health nurses adopted the standardized use
of the S.K.I.N bundle: (S)election of appropriate surfaces,
(K)eep patients moving, (I)ncontinence management,
and (N)utrition management and hydration.
Despite—or perhaps, in part, because of—its
investment in patient safety, the Catholic health system
is also financially robust: Earlier this year, Ascension
Health announced a deal to acquire a four-hospital
system, bringing its total to 73 acute care hospitals.
After eight years of intense focus on quality
improvement, the health system has some concrete
examples of how improved quality translates into
improved financial performance; for example, its
malpractice costs declined by 36 percent between
FY05 and FY10.
However, calculating the cost-effectiveness of
many individual quality programs is elusive, says Pryor.
“We can point to examples that illustrate a direct tie
between improving quality and reducing our overall
operational costs. However, this is not the case with
every quality improvement.”
Unable to cast “higher quality equals lower costs”
in stone, Ascension Health has adopted a divergent
philosophy: “Fundamentally, we as an organization
believe that good quality is also good business,”
says Pryor.
>>
Next: Using Technology to Improve
Decision Making
Technology is becoming a critical tool for
clinical and business decision making.
See Section 4, page 46.
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46
Using
Technology
to Improve
Decision
Making
Technology is helping healthcare leaders improve
their decision-making ability at the bedside, in team
meetings, and in the executive suite.
48
As discussed in Section 3, the increased use of EHRs,
mobile platforms, and other technologies can add to a
healthcare organization’s risk profile. Data breaches
and accompanying penalties can cost millions or even
billions. Other risks include equipment breakdowns
and investments in rarely used technologies.
But the potential benefits to be gained from
technology typically outweigh the risks. In particular, as
illustrated in this section, technology is becoming a
critical component of provider efforts to improve quality
and reduce costs. The technology is helping them track
data/trends and identify better approaches for improved
efficiency and patient care—thus, allowing healthcare
organizations to better manage risk and improve
overall value.
Case Study: Improving Patient Flow >
and Nurse Staffing
During a three-month period earlier this year,
St. Anthony’s Medical Center in suburban St. Louis
treated 1,000 more patients in its emergency department
(ED) than during the same period two years earlier. This
was possible because the St. Louis hospital eradicated
its long-standing problem of ambulance diversions.
“Eliminating diversions for St. Anthony’s is found
money,” says CFO John Skeans. “We were basically
telling patients that we were closed for business.”
The ambulance diversion problem went away after
St. Anthony’s developed a software program that helps
managers quickly redeploy nurses to where they are
most needed, improving the flow of patients from the
ED to inpatient units.
>>
Common Approaches
While every technology project is different, the two
providers in this section share some common lessons
learned.
>>Focusing not on the technology, but on how the technology
will improve patient care, increase efficiency, and improve
the work environment for staff
>>Overhauling workflow and processes before implementing
the technology
>>Designing technology around what staff and patients
really need—and possibly saving dollars by forgoing
bells and whistles
>>Involving physicians, nurses, and other staff in technology
design and implementation
>>Using technology’s data analysis and tracking ability for
better decision making—at all levels of management
>>Determining and celebrating the ROI
That technology is one component of a complete
overhaul of the hospital’s nurse staffing system that
resulted in a dramatic improvement in the hospital’s
financial position. “Where other hospitals and health
systems have had layoffs and salary freezes, we
have continued to have merit increases,” says Sherry
Nelson, St. Anthony’s vice president of patient care
services and CNO.
On top of that, St. Anthony’s will pay out “shared
fruit” bonuses averaging $500 to each staff member
because the hospital met its financial and patient
experience goals for the fiscal year that ended June 30.
It also paid out bonuses for the previous fiscal year.
That is a far cry from 2009, when a cash flow crunch
required St. Anthony’s to drastically cut expenses.
The hospital chose to address the financial problem
by addressing its single biggest expense: nurse labor
costs. Not wanting to inadvertently harm quality, the
hospital identified creative solutions to use nursing
resources more wisely.
The result: St. Anthony’s cut $25 million from its
budget in 2009 and kept the hospital in the black—
while improving the caliber of its nursing staff.
49
St. Anthony’s Amy Baker, MSN, RN, conducts a presurgical
assessment with a patient.
Hiring to save money
“One of the things that is important to the bottom line
is having the right staffing,” says Nelson. That is why
St. Anthony’s staffing overhaul focused on reducing
turnover among nurses, improving job satisfaction, and
upgrading the level of nursing skill and experience.
For starters, St. Anthony’s increased nursing hires
by 8 percent in 2009 so that it could stop relying on
expensive travel nurses. Nelson also sought to recruit
highly skilled registered nurses (RN) and limit the
number of practical and vocational nurses on staff.
At the same time, Nelson instituted consistent work
schedules in each unit, which improved morale and
reduced absences that, in the past, had required the
use of contract nurses.
Those practices helped St. Anthony’s cut its travel
nurse budget and achieve its ultimate goal of reducing
turnover in the nursing ranks. The hospital’s total
voluntary RN turnover rate fell from 15 percent in FY10
to 13.5 percent in FY11.
Shifting resources
St. Anthony’s also looked to technology—an internally
developed software program called N Quality Staffing—
to improve the allocation of nursing resources. Two
hours into each shift, unit managers enter the unit’s
patient census into the staffing software, along with
the number of nurses, unit secretaries, aides, and other
staff members on duty. The software program compares
this real-time data with the unit’s standard patient-nurse
ratio and gives a color-coded visual cue to automatically
communicate staffing needs. The color orange means
the unit is close to full capacity, and red means another
nurse is needed.
When nurse managers from all units gather for
their daily huddles during each shift, they use this
information to quickly reassign nurses to where they
are needed most. Those staffing adjustments allow
patients to move from the ED into an inpatient bed
more quickly, freeing up ED beds and eliminating the
need for ambulance diversions.
“Improving throughput has increased revenue,”
says Skeans.
Investing in a new software program during a
financial crunch seemed daunting. By focusing on
what nursing leaders really needed to manage staffing,
St. Anthony’s was able to develop a relatively simple
system internally. “The commercial systems are more
sophisticated, but this system lets nurse managers
know visually if they have enough nursing staff to take
more patients,” says Nelson.
Photo: St. Anthony’s Medical Center. Reprinted with permission.
“Every time we lose a nurse, it costs the organization approximately $60,000, so reducing turnover is at
the forefront of what we’re working toward,” says
Nelson. “My goal is that the best nurses in St. Louis see
their career endpoint at St. Anthony’s Medical Center
and that they would never want to work anywhere else.”
To build on the success to date, Nelson continues
to introduce new initiatives to boost nurse satisfaction.
Because it is difficult to recruit experienced nurses in the
highly competitive St. Louis market, St. Anthony’s must
hire new graduates who have little real-world experience
in the hospital setting. That is why the hospital created
a nurse preceptor program in which experienced RNs
receive bonuses for working one-on-one with new
graduates to help them succeed on the job.
50
Automating time and attendance
Additionally, St. Anthony’s recently started using an
automated system to standardize the capture of time
and attendance information. Previously, nurse managers
kept track manually of a nurse’s work absences, lunch
hours that were missed because of too much work,
and other payday-important information. This led to
inconsistencies in applying attendance policies, misunderstandings, and on occasion, inaccurate paychecks
that required time-consuming paperwork to fix.
Under the new system, the time clock that nurses
use is equipped with a computer screen that captures all
details of a nurse’s time and attendance electronically.
“You can swipe your badge and, for example, put in a
code that says ‘pay through lunch,’” says Nelson.
This system improves attendance because nurses
know what the official record of their work attendance
says. “This consistent, standardized approach will
decrease our call-ins from nurses asking for time off
because everybody will know where they stand,”
says Nelson.
Case Study: Improving Clinical Care
Standardization and improvement is also central to
Sentara Healthcare’s $237 million eCare system—which
includes an electronic health record (EHR) and related
technology. Six years into implementing eCare, Sentara
leaders advise going full-out or staying home.
“EHR rollout is not just the implementation of an
application or a computer system; it’s an entire redesign
of the approach to care delivery,” says Greg Hafer, RN,
director of eCare operations. “It requires a commitment
throughout the organization.”
The eCare system includes:
NN Computerized physician order entry (CPOE)
NN Clinical decision support and standardized order
sets and care plans
NN Online documentation
NN Medication administration with barcode scanning
NN Electronic capture of images, lab results, surgical
summaries, and all other data
NN E-prescribing
NN Data sharing with state and national patient
registries
NN A patient portal
“Every time we lose a nurse,
it costs the organization
approximately $60,000, so reducing
turnover is at the forefront of
what we’re working toward.”
Sentara, a 10-hospital integrated system based in
Norfolk, Va., took home the Davies Award from the
Healthcare Information and Management Systems
Society (HIMSS) last year in recognition of its successful
eCare implementation and the improved patient care—
and value—that stemmed from it.
In addition to achieving the top status—Stage 7—
in the HIMSS Analytics rating system for EHR adoption,
a Sentara hospital has appeared on Hospital & Health
Networks’ “Most Wired” list in each of the past
three years.
Those accolades reflect Sentara’s investment for
the long haul.
“Very early on, we framed this as the biggest capital
project Sentara has ever undertaken, bigger than investments we’ve made in new facilities,” says J. Miller
Trimble, Sentara’s director of information technology.
“That was an attention-getter for the entire health
system. When you discuss EHR implementation in those
terms, staff generally buy into making it a success.”
After a two-year planning phase, Sentara
implemented the eCare system at its first hospital in
2008—and its eighth hospital this year. (Two of the
system’s 10 hospitals were acquired this year.) This
past spring, the health system completed installation
of the EHR technology in all locations of the Sentara
Medical Group, which employs about 400 physicians.
In addition, more than 55,000 patients are now using
Sentara’s patient portal to communicate with physicians, schedule appointments, view test results, and
request prescription refills.
Planning thoroughly
Sentara made sure that eCare was a clinically-driven
project by creating a Physician Advisory Group comprised of more than 25 community physicians. Members
of the advisory group were hand-picked from a pool of
physicians who had volunteered to serve.
“You bring to the table the physicians who are
known technology champions, but you also bring those
who are potentially naysayers so that you can engage
them early,” says Hafer. He also recommends involving
physicians who work in procedure-driven disciplines,
such as surgery, because those areas present special
challenges for the EHR.
52
“You bring to the table the
physicians who are known
Technology champions, but
you also bring those who are
potentially naysayers so that
you can engage them early.”
The physicians helped select the vendor, advised on
software design, and served as “super users” during
implementation to help other physicians and staff
members learn the technology. They were paid an
hourly rate for the time devoted to eCare, similar to the
way a medical director is paid for administrative hours.
During the design phase, members of the Physician
Advisory Group spent about four hours a week on
eCare. Currently, the group meets for about two hours
a month to monitor eCare issues.
Redesigning processes
Healthcare leaders need to recognize that overhauling
work processes will present the biggest challenge to a
successful EHR implementation—and offer the biggest
benefit, says Trimble. Redesign processes before the
new technology is installed, he advises.
During the design phase and initial implementations,
the eCare team included 100 clinical staff—nurses,
pharmacists, radiology technicians, and others—who
worked full time on the eCare initiative alongside
90 IT staff members.
More than two years before eCare implementation
at the first hospital, process improvement engineers
were assigned to work with system-level process owners
to redesign 18 major processes ranging from clinical
communications to charge capture.
Each of the redesign teams spent three months
analyzing current processes, measuring performance,
and identifying problems and opportunities. Using that
information, team members designed ideal processes.
For example, communication between clinical
departments was identified as a process critical to both
the quality and safety of patient care. Nursing departments and ancillary departments came together to
define and develop key elements of patient information
that were critical in the transition of patient care from
one department to another.
Team members then identified the changes that
needed to occur to achieve these ideal processes
and sorted them into four categories:
NN Changes that would occur automatically when
the EHR was implemented
NN Changes that required action to exploit the EHR’s
full potential
NN Changes that had nothing to do with the EHR
NN Changes that would happen at a future point
after EHR adoption
A lesson learned: Sentara leaders assumed that the
process owners would communicate and embed the
new processes at the hospital, but this did not happen
as envisioned, says Trimble. About six months before
“go-live” at the first hospital, the process improvement
engineers had to be engaged to work directly with more
than 40 departments to help leaders and staff members
understand their existing processes and adopt the
needed improvements.
This worked well in all but three departments—
medical records, surgery, and endoscopy—where the
process changes overwhelmed the staff members’
ability to adapt, resulting in throughput problems
when the EHR system was implemented.
The problems were worked out during an optimization phase that is built into the EHR rollout at each
Sentara facility. During this phase, members of the eCare
optimization team work with clinical staff members to
address implementation snags and ensure that the
technology is being used—and achieving results—
according to plan.
Trimble says this optimization step is essential
to generating and measuring the ROI for an EHR.
Diving in
Sentara leaders learned another important lesson
during its initial eCare launch: Go “big bang” with all
EHR features rather than phasing them in over time.
In that first hospital implementation, CPOE was not
introduced immediately. So physicians and staff members experienced successive waves of major change.
“We learned that there was a tremendous amount
of resiliency to tolerate the chaos that ensues with
major workflow changes,” says Hafer. “But when you
are constantly changing things, and there is no time in
between for things to stabilize, people don’t tolerate
that as well.”
The big bang launch is now standard for Sentara
eCare implementations. To prepare for such a highly
disruptive event, each hospital performs competency
and skill checks with staff members well before the
53
readings in different ways. The eCare data feed into
Sentara’s key performance indicator (KPI) dashboard,
which reports hyperglycemic and hypoglycemic rates at
the department, hospital, and enterprise level. The KPI
dashboard also tracks two other process measures—
the average duration of central line placement and the
percentage of heart failure patients weighed daily—
that can influence adverse events and length of stay.
By having access to that data in near-real time,
senior leaders, department/unit managers, and bedside
staff can be in constant communication about expectations and how to remove barriers to achieving clinical
standards and performance metrics. “We are seeing
continual improvements in the numbers on the KPI
dashboard,” says Trimble.
Making better decisions
The eCare system provides information for better decision
making at the bedside and all levels of management.
In the paper-chart days, nurses had to flip through
a patient’s record, trying to assimilate data from the
recent past to identify a trend that might help inform a
treatment decision. Now when Hafer rounds through
medical/surgical units, he sees nurses consulting trend
lines on computer screens that display, for example,
a patient’s blood sugar levels over time to see how
the current reading compares with the recent past.
“We are seeing bedside staff starting to use data
in a different manner,” he says.
Meanwhile, managers throughout the Sentara
organization are using those same blood sugar level
Influenza Tracking at Sentara
By tracking influenza-related volumes on a real-time basis, Sentara was able to keep up with H1N1 surges during the 2010-2011 flu season.
Hospital Diagnoses Related to Influenza Filtered by Time, Days, Diagnosis, and Location
0.14
0.12
0.10
0.08
0.06
0.04
0.02
01/24/11
01/23/11
01/22/11
01/21/11
01/20/11
01/19/11
01/18/11
01/17/11
01/16/11
01/15/11
01/14/11
01/13/11
01/12/11
01/11/11
01/10/11
01/09/11
01/08/11
01/07/11
01/06/11
01/05/11
01/04/11
01/03/11
01/02/11
01/01/11
12/31/10
12/30/10
12/29/10
12/28/10
12/27/10
12/26/10
0.00
“The ability to use EHR data
to see systemwide trends as
they are developing offers
opportunities that Sentara
leaders did not forsee.”
technology goes live. For example, nursing staff
demonstrate the process for medication administration
with barcode scanning technology.
“Probably the most important thing is to flood the
units with enough support during the launch so that
patient care is not delayed,” says Hafer.
54
Improving business intelligence
In addition to clinical indicators, the dashboard tracks
compliance with CPOE use (down to the physician
level) and medication barcode scanning. And it allows
managers to monitor patient volume and revenue
statistics (including margin analysis and revenue by
payer trends) over time, and benchmark them against
expected values at a hospital.
Three times each day, the dashboard updates patient
census and occupancy rates by facility, unit, type of
service, and financial class. More detailed and frequent
information is captured from Sentara’s EDs, including
boarding hours, turnaround times for minor emergency
care, arrival to triage, arrival to admission, boarding
hours, and turnaround times for specific types of care.
While some statistics are used for analysis and
planning, others are used for immediate resource
allocation. For example, every 15 minutes, the dashboard reports the average ED patient wait time, and
when thresholds are exceeded, managers are alerted.
The ability to use EHR data to see systemwide trends
as they are developing offers opportunities that Sentara
leaders did not foresee. When the H1N1 flu emerged
in late 2009, for example, members of the infection
control staff suggested that EHR data might be used
to help hospitals plan and manage a surge in demand.
The dashboard was changed to capture and report
influenza-related diagnostic data, including upper
respiratory diagnoses, flu-like symptoms, and viral
syndromes, from hospital EDs and medical group
practices every two hours. The information was presented graphically so that clinical staff members could
see the trends from day to day and compare them with
previous time periods (see the exhibit on page 53).
“Because we had the EHR and the KPI dashboard
in place, it really took very little work to get the
information posted and available to the key people
who needed to see it,” says Hafer.
The dashboard helped leaders ensure that EDs
and physician offices were appropriately staffed to
handle surges of H1N1 patients. It also helped increase
operational efficiency because staff members avoided
stockpiling supplies; they could see the pace with
which patient load was increasing and they could see
how quickly they could get more supplies when they
needed them.
eCare’s Cumulative ROI
Sentara Healthcare achieved $40.9 million—much more
than the expected $29.3 million—in annualized ROI from
its eCare EHR system in 2010. Results are for six hospitals,
home health, and a Sentara-owned health plan.
eCare Benefit Category
Benefit
(Millions)
Reduced length of stay
8.7
Increased outpatient procedures
5.7
Increased unit efficiency/RN retention
9
Reduced transcription expense
2.7
Reduced medical records and supply costs
1.8
Reduced medical records staff
1.8
Reduced Sentara-owned health plan costs
Improved charge capture
2
1.9
Reduced 63 administrative positions
Reduced other costs
Total
2
5.3
40.9
Calculating costs and benefits
In 2010, Sentara calculated $48.5 million in financial
benefits—more than $10 million over budgeted benefits
for the year. Redesigned clinical and administrative
processes factor heavily in the ROI for the eCare system,
says Trimble. (See the exhibit above.)
Among the wins: Sentara hospitals are avoiding
more than 10,000 potential medication errors every
month since adopting the medication barcode scanning.
Improved patient throughput reduced patient length of
stay by more than 16,000 days in the first two years—
and the average turnaround time from ED to inpatient
status has been cut to 90 minutes. The medical records
function now costs $3 million less per year, while
claims denials have decreased by $500,000 annually.
“It requires a fair amount of up-front work and
discipline to create the business case and ROI structure
for an EHR,” says Trimble. “But if you apply the
discipline to follow it and carry it out, it can certainly
be done. We’ve been able to prove that.”
>>
Next: Last Word
One physician leader’s take on managing
clinical and business risks in today’s complex
environment. See page 56.
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56
Engaging Physicians
to Improve Value
An interview with David Maizel, MD
This is similar to what Maizel does now in his
management role: “We also consider the impact of our
recommendations: Is there only going to be a positive
impact or are there going to be some unintended consequences we have to manage, mitigate, or minimize?”
Training with Intention
After practicing medicine for 25 years, David Maizel, MD,
exchanged his white coat for a suit jacket to become
president of Sentara Medical Group, and a few years
later, corporate vice president of 10-hospital Sentara
Healthcare in Norfolk, Va.
Although he looks back with pride on his years as a
family practice physician, Maizel finds his new role to be
tailor made. He believes that many physicians possess
a key leadership skill: problem solving. “Physicians can
apply what we know about diagnosing and treating
patients to the management side of health care.”
Although not all physicians are inclined to take up
leadership roles, many are willing and able to become
more involved in efforts to improve healthcare delivery.
The first step, says Maizel, is to extend an invitation.
“We really need to break down the barriers and the
fragmentation that has historically existed in health
care, and to really embrace the notion that we are
much better off if we all work together.”
The second step is to provide training. Specifically,
Maizel has found that physicians often need training in
quality and process improvement methods.
However, timing is key. Maizel suggests involving
trainees in a specific improvement initiative where they
can use their education to improve whatever that
initiative is focusing on. “There’s huge power to that.”
Sentara Medical Group used this approach
when redesigning primary care practices into
patient-centered medical homes (see page 13).
About 50 physicians and managers were trained in
Lean process improvement methodologies—and
then served on teams that reengineered practices to
make them more efficient and customer-focused.
Mitigating Risks
“As medical students and practicing physicians,
we are trained to be good listeners,” says Maizel.
“We gather facts by assessing a patient’s concerns
or complaints and, depending on the situation, order
some diagnostics to help narrow down the problem.
We then use those facts to come up with a working
diagnosis and plan.”
In many ways, providing the best possible clinical
care is about managing risks, he says. “When making
recommendations to patients, we balance the potential
treatment benefits against the possible harm that can
result from those treatments.”
Influencing the Future
Rather than being discouraged by the level of uncertainty and risk in health care today, Maizel is inspired.
“A lot of people are very concerned about where we
are in health care right now. Some are saying, ‘Boy,
maybe it’s time for me to get out,’” he says. “But I think
this is one of the most exciting times in the history
of our profession and our industry. I think if we take
the right approach, we can really influence the way
health care is going to be provided in this country for
decades to come.”
1,024
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and counting
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INTERIM LEADERSHIP | EXECUTIVE SEARCH | CONSULTING SOLUTIONS

Sentara Healthcare`s David Maizel, MD, on managing business and

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