With a significant nudge from the federal government, UCHealth and other health care systems across the country continue to lay the foundation for changes in the way they deliver care. The goal: build a system that provides integrated, coordinated services to a defined group of patients with different clinical and social needs.

The approach, dubbed “population health,” isn’t new, but it has gained momentum the past several years as health care costs continue to take a big bite from the budgets of employers, health insurance payers and individual consumers. The idea is to replace fragmented, episodic care that rewards volume but often fails to address long-term health care issues and needs with a system that rewards value, as measured by clinical outcomes, efficient use of resources, and patient and provider satisfaction.

Efforts to meet these goals accelerated at UCHealth in 2014 with the addition of Jean Haynes as population health officer in 2014. In 2015 University Physicians, Inc., the organization representing the faculty of the CU School of Medicine, joined with the school to launch the Office of Value Based Performance (OVBP). The office, directed by Lisa Schilling, MD, provides support to SOM clinicians through helping with transitions-of-care activities, addressing patients who are overdue for preventive tests, and other steps that demonstrate the value of the care provided.

Earlier this year, Colorado Health Medical Group (CHMG), UCHealth’s medical group in northern and southern Colorado, entered into a “value-based” contract with Cigna that ties payments to patient-outcomes measures in areas such as preventive care, clinical coordination, and patient satisfaction. Now UCHealth is working on the next steps in the evolution of population health.

Out with SGR, in with MACRA

Nationally, the move toward a value-based system gained momentum last year with the congressional repeal of the “sustainable growth rate” (SGR), a cost-control concept initiated in 1997 that aimed to tie Medicare payments to physicians to growth in the national economy. With rising medical costs, the SGR demanded reimbursement cuts that Congress staved off for more than a decade by simply avoiding the issue. 

The repeal of SGR paved the way for the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), which is designed to tie clinician reimbursement to actual performance rather than the vagaries of the gross domestic product. CMS issued its proposed rules for MACRA in April and took comments through late June. It is slated to take effect Jan. 1, 2017.

While MACRA includes a bewildering alphabet soup of acronyms describing various payment models, the fundamental goal is to reward clinicians for value rather than volume. The system proposes two paths to pay for quality care. Under the new Merit-Based Incentive Payment System (MIPS), clinicians would receive increases or decreases to their Medicare payment schedules based on their performance in four categories: cost of care, quality of care, use of electronic health records, and clinical practice improvement.

In the simplest terms, groups that provide safe, high-quality care and coordinate it with other providers will be rewarded. Those that don’t meet the standards will be penalized – there is no “neutral” position. The “performance period” to submit data and establish a baseline would run from Jan. 1, 2017 through Dec. 31, 2017. The first payment (or penalty) year would be 2019, with amounts based on data gathered from the performance period. The maximum “adjustments,” up or down, to the fee schedule would start at 4 percent in 2019 and incrementally increase to 9 percent in 2022.

The second path, dubbed “Advanced Alternative Payment Models,” makes clinicians eligible to receive incentive payments for serving Medicare patients and exempt from MIPS. In short, clinicians in Advanced APMs would join with hospitals and other health care providers in accepting risk for managing a population of patients. In return, they would eventually qualify for higher fee schedules than clinicians who choose to participate in MIPS – but they would also share in losses if the Advanced APM fails to control costs or meet quality measures.

In a summary of MACRA’s major provisions, CMS explains that the goal is to reward clinicians for “participation in Advanced APMs that create the strongest incentives for high-quality, coordinated and efficient care.” In other words, those who work with organizations that have found ways to collaborate in managing the needs of patients would do best.

Population health prep

In preparation for these changes, UCHealth has taken a number of steps. For one, Charles Baumgart, MD, recently joined as chief medical officer for population health. Baumgart, who specializes in population health management, previously served in leadership positions with Geisinger Health System in Pennsylvania and Presbyterian Health Plan in Albuquerque, New Mexico. He says he’ll work on “promoting the vision of population health” and encourage staff and providers throughout the system to work together to coordinate patient care.

In addition, UCHealth has applied to CMS for consideration as one of its Advanced APMs. That’s a major strategic decision, said Jean Haynes, and it requires more than simply assembling a collection of providers and facilities. A health care system’s ability to manage its patient population, from the healthiest to the sickest, relies on “understanding who they are and having the infrastructure in place to engage them,” she said.

In UCHealth’s case, that means having access not only to clinical data from the Epic EHR, but also claims data from CMS and other payers that show a more complete picture of the care patients receive, both within and outside the UCHealth system, Baumgart said.

“Right now, we don’t see all of the claims data for our patients,” noted Barbara Carveth, chief financial officer for University of Colorado Hospital. “CMS wants us to spend less and manage patient care across different systems. We have to have that transparency so we can see changes in the care they receive after they leave the hospital.” That is essential to managing patients’ transitions of care, Carveth added.

Having access to that broad data set is a key consideration for UCHealth and other systems, Haynes said. “We have to understand the population for which we have accountability. That will allow us to make a projection of those who are at risk and will need us to reach out proactively to assist them in managing their care,” she said.

With that information, UCHealth and payers can agree on targets for outcomes and the cost of care and ideally share the savings or losses, Haynes added.

The Advanced APMs offer a range of choices based on the degree of risk an organization is willing to assume. To evaluate that, UCHealth has pulled together a team that includes clinical, financial, administrative, and information technology leaders, Haynes said, adding that the organization is “investing in the infrastructure to manage any risk we would assume, based on what is known and what we can calculate.”

Common ground with hospitals

Baumgart noted that the MACRA provisions dovetail with now well-established “value-based purchasing measures” that CMS put in place after the passage of the Affordable Care Act in 2010 to encourage hospitals to work with other providers to manage patient care after discharge.

These approaches include imposing financial penalties on hospitals that do not meet averages for measures such as 30-day readmission rates for heart failure patients. More recently, CMS introduced bundled payments for hospitals – including UCHealth’s University of Colorado Hospital – that perform total joint replacements. Hospitals get a set fee for performing the procedures and managing the care of patients for 90 days. The idea is to encourage hospitals, post-acute care facilities and outpatient providers to coordinate care and prevent unnecessary emergency room visits and readmissions.

“Hospitals have had their own journey and starting point and physicians have had theirs” in addressing population health management, Baumgart said. Common to all the payment programs, however, is an emphasis on redesigning care delivery, minimizing care-process variation, and managing costs, he added.

That’s been a tough task in a health care system that has long rewarded volume with the quick satisfaction of fee-for-service care, Carveth said.

“We are looking at how we are structured and using our resources to best manage care for populations of patients who have chronic conditions or are higher risk,” she said. “The dollars for hospitals are in effectively managing that group. But it is a financial investment without immediate returns.”

Laying the foundation

Nonetheless, the groundwork of building a population-based approach to care has been occurring on various fronts at UCHealth for some time. For example, MACRA pulls together several “value-oriented” programs CMS has used for years to encourage high-quality, cost-efficient care and “meaningful use” of EHRs among physicians, said Christina Finlayson, MD, associate medical director for UPI. The OVBP provides support in identifying metrics and reporting to CMS, and UPI clinicians have routinely scored “on the high end” of quality measures and close to the mean on cost, Finlayson said.

The Epic EHR also supports UPI and CHMG physicians with the “Healthy Planet” module, which helps to build registries aimed at managing patients with specific medical conditions, such as diabetes, hypertension and heart failure, Finlayson added. Healthy Planet, in turn, works hand-in-hand with Ambulatory Health Promotion, a program sponsored by General Internal Medicine, UPI and UCH that since 2004 has focused on primary care outreach to targeted populations of patients to identify gaps in care and assist providers in closing them.

The Epic EHR is a vital tool in finding patients who have seen UCHealth specialists but not a primary care provider, Finlayson added. Building the number of patients who see a UCHealth PCP is a key to providing them with coordinated care and meeting MACRA standards, she said.

“We know that with patients who are seen by a PCP, we do well in quality measures,” Finlayson said. “That’s why we need to expand our primary care footprint, to increase patient access and provide team-based care.”

Even in MACRA’s new, as yet untested measure of performance – clinical practice improvement – UPI is well positioned to score well, said Nicole Petersen, regulatory lead for OVBP. She noted that the category encourages care coordination, patient engagement, and safety, all major focuses of the eight family medicine and internal medicine practices at UCH that have earned NCQA (National Committee for Quality Assurance) Level 3 certification as patient-centered medical homes. The CHMG/Cigna contract is also oriented toward these goals.

The 962-page gorilla

Petersen acknowledged that the proposed MACRA rule is “overwhelming in its complexity,” which she learned in reading all 962 pages of it more than once. The clinical practice improvement category alone contains more than 90 measures for providers to choose from, she noted. And while performance measures are no longer completely foreign to UPI and CHMG clinicians or to UCHealth hospitals, the hospital and clinician worlds have to a large extent occupied separate orbits. A population health-based system will require that to change.

However, hospitals and clinicians have plenty of common ground in working with patient populations, said Julie Schwent, manager of the OVBP. She pointed to managing diabetes and preventing complications, reducing cardiovascular risk, and minimizing hospital readmissions as common quality measures in both MACRA and hospital value-based purchasing programs. Her staff huddles with Haynes’ team, as well as other CHMG staff to align project goals and share insights from previous quality-improvement initiatives.

“We ask, ‘What are you doing that we might not know about?’” Schwent said.

The fact that UPI has an office focused on population health with Petersen as a regulatory lead dedicated to supporting clinicians in preparing for MACRA is another huge plus for UCHealth, Schwent said. “This has been vital due to the complexities of digesting and planning for MACRA requirements,” she added.

That’s one of the many worries MACRA has generated. “There will be a greater administrative burden and lots of box-checking,” Finlayson acknowledged. That could lead to a decrease in the number of providers who agree to see new Medicare patients – or any at all, she said. “If a practice doesn’t have the resources to take a 4 percent to 9 percent hit to the Medicare reimbursement fee schedule, it could affect access.”

The fast track to MACRA launch is another concern. For now, CMS won’t release its final rules until November, which will leave a very short window to the January 2017 go-live, a particular concern for small and rural practices, Petersen noted. “CMS is aware that is a potential issue,” she said. “There may be a delay to give them more time to prepare.”

Regardless of these uncertainties, the change is coming and UCHealth will continue to prepare, said Baumgart.

“There has been an investment by the organization because it believes strongly in improving the health of patient populations,” he said. “Our hospitals and physician groups will find ways to work together. No one can do it alone.”