Program Oriented Payment

FAQs: Program Performance- Fifth, and Last, of This Series

2012-02-23T07:33:00.002-08:00

1. Who can see provider performance data?

a. The health plan and its medical management department have access to all program data. A specific program’s participating providers have access to the all performance data.

2. When would the performance results be seen?

a. This depends upon how the program is designed. POP methodology describes the “how to”. The “when” is up to the Plan.

FAQs: Program Administration - Fourth of a Series

2012-02-13T11:04:00.000-08:00

This is the next section of the FAQs.

If you have any comments or questions of your own, leave a comment on the blog, and we will get you an answer and consider including the question in the FAQs

This section: Payment

1. If we are on the program for 6 months and then go off; will we still get the reward for those qualified patients that we see?

a. Yes and no. Incentives are determined using Problem Based Networks (PBN). PBNs are formed during a specific look-back period. If the provider is participating during the look-back period timeframe inclusion in the PBN is assured. Any and all benefits of participation, including incentives, are shared with the provider. If the provider is not in the PBN, no incentives are paid, even if the provider is still seeing the patient.

2. Will the program require providers to accept new patients?

a. No. The right of providers to refuse patients is not altered by the programs.

3. Why are incentives based on clinical outcomes and not the guidelines the office meets?

a. In a way, incentives are based on guidelines, just not the traditional ones. POP methodology assumes appropriate best practices (guidelines) as a baseline. The incentives of the program exist to reward performance that exceeds baseline care.

4. What determines if an incentive is earned? When is it calculated?

a. Provider performance measured against the provider goal. Fee for Service (FFS) is calculated when the claim is adjudicated; Per Member Per Month (PMPM) is calculated on a fixed monthly schedule.

5. Are Physician’s Assistants and Nurse Practitioners considered providers by POP?

a. If they are listed as a Plan’s provider in the CIM system with a primary taxonomy code, yes.

6. Will POP be able to use data from Electronic Health Record (HER) systems such as NextGen?

a. As the POP methodology matures, the development plan is to support local EHR vendors as needed and as quickly as possible. The Health Information Exchange, a national initiative, is the crucial link between EHRs and data collection. Its successful implementation will provide POP with a dependable EHR structure to build upon.

7. Are the health plans going to make us do this?

a. POP methodology defines participation in a program as a decision of the provider. It is outside of the POP methodology scope whether or not a Plan requires provider participation in their POP programs.

8. What is the incentive for the hospital?

a. Hospitals, like all providers, will benefit more from certain programs than others. Participation by all providers is optional. We believe that the interests of the community will serve the interests of all providers. Hospitals will participate where they find opportunity.

FAQs: Payment - Third of a series

2012-02-07T15:56:00.000-08:00

This is the next section of the FAQs.

If you have any comments or questions of your own, leave a comment on the blog, and we will get you an answer and consider including the question in the FAQs

This section: Payment

1. Is there another risk pool withheld from the initial payment?

a. No. Incentives are funded through savings accrued during a program. For planning and budgeting purposes, a savings amount is projected from the data, and a percentage of the amount ear-marked for incentives. Simply put, no savings; no incentive.

2. Who can see incentive payment data?

a. The health plan and its medical management department have access to all program data.. Incentive payment data is available to the provider and their billing vendor.

3. Is the incentive payment broken down by patient or is it a lump sum?

a. Payment is made as a lump sum. Providers have program tools that allow review of every claim contributing to the payment to see details of the incentive, what triggered the payment and why. This can also be done prior to payment when payments are accrued in the payment due register.

4. When are incentive amounts determined?

a. When the Plan’s program’s budget cycle ends and savings are realized.

5. Are the incentive amounts paid immediately?

a. When incentives are paid is the Plan’s and the program designer’s decision.

6. What happens to incentive amounts that are determined, but not paid?

a. The “payments due” register is the POP accounting mechanism that accumulates incentive amounts for payment.

7. Can I see my incentive amounts?

a. Yes. In the CIM 4 program application, providers can review their current status and incentive amounts.

8. What priority does an incentive amount have with respect to distribution of savings?

a. This is a decision of the plan. POP methodology recommends incentives be the first payments made when savings are realized by a program.

9. Where do the non-incentive savings amounts go?

a. They are distributed based on existing risk sharing relationships.

FAQs: Patient - Second of a series

2012-01-30T10:14:00.000-08:00

This is the next section of the FAQs.

If you have any comments or questions of your own, leave a comment on the blog, and we will get you an answer and consider including the question in the FAQs

This section: Patient

Patient

1. What is the incentive for the patient?

a. The patient incentive is not directly monetary as it is for the providers. By definition, a patient (member) automatically participates in Plan programs if their condition(s) meet the program’s design and goals. Indirectly, the patient’s incentive is better care and improved health due to the program’s participating providers’ collaborations and focus on program goals.

2. How can we control the compliance of the patient?

a. You can’t. But the patient, over time, may recognize the increased attention they are receiving from their program’s Problem Based Networks (PBN) and improved health, and become aware that their compliance is a large contributor to how they progress.

3. Should there be some reward for the patient?

a. There is, if by “reward”, the question includes improved care and better health. Monetary reimbursement has been, and continues to be, considered, but at this juncture of POP implementation (January 2012), it is not a factor.

4. What if we took all that money and gave it to the patient?

a. The provider incentive, a keystone of POP methodology, would be removed and a program could collapse. A provider incentive helps reimburse the provider for their increased attention to the patient and the Plan’s program. The patient receives improved care and attention, an incentive in and of itself.

FAQs: Medications - First of a Series

2012-01-23T14:02:00.000-08:00

At all presentations, we have been collecting questions and putting together an FAQ document. The purpose is to provide a resource for future presentations and centralized access at the PH Tech website.

The next few blog entries will contain selected sections of the FAQ document.

If you have any comments or questions of your own, leave a comment on the blog, and we will get you an answer and consider including the question in the FAQs

Today’s section: medications

Medications

How are medications tracked?

Files from the pharmacy benefit managers (PBM) are used to obtain medication data and functionally processed using POP methodology.

How do medication samples affect medication tracking?

In the initial POP implementations, medication sample use is not expected to be a significant factor. Going forward the programs are dependent upon providers correcting medication entries to reflect sample disbursement. Providers are expected to record information that other sources cannot provide using program tools.

If you are going to include medications then how will you handle MED ASSIST?

If, and until, Med Assist data can be electronically collected, the provider is expected to record the data using the tools provided by the program.

POP and the Problem Based Network (PBN)

2011-12-21T09:35:00.000-08:00

by Michael Rohwer MD
Significant conditions in health care are those that reflect high costs or serious adverse outcomes. It is rare for one of these conditions to be the responsibility of a single provider and it is unusual for a single provider acting alone to be able to maintain substantial improvement in highly complex conditions. Sustained improvement requires treatment by collaborating teams of providers.

Currently, even in the best of situations, not every pairing of provider and patient will be productive. Both need flexibility and freedom to make and accept changes that accommodate their differences. While teams are needed, rigid structures created by business relationships are not, due to their limits on individual preference.

In practice, providers and patients have multiple overlapping connections in the guise of other providers or practitioners. The connections are of many types that depend upon the specific needs of the provider and the patient, and create a very complex therapeutic network. This complexity makes the application of consistent measures and management difficult.

One of many functions of the POP program context is to create a management view of the participating providers at any one point in time. This management view is called a Problem Based Network (PBN). It provides a decision tool for management to assess financial, performance, and quality-of-care for a program’s targeted condition.

A PBN is assembled from provider submitted claims. Program eligible patients are first identified from the submitted claims using POP program specific parameters. Then the Qualified Specialties parameter is applied to these claims to identify participating providers that have had encounters with the patient. The resulting list of providers is the patient’s PBN for the specified look-back period. Caring for the patient is the central focus for defining the PBN, making it intrinsically patient centric.

The operation of the PBN is monitored through analysis of encounters and process measures. Because PBN providers share success, the realization of incentive payments supports collaboration. The collaboration demonstrated by individual providers is measured indirectly through comparative analysis of participation in multiple patients’ programs as part of PBNs. The PBN provider performance is directly measured through analysis of the degree of program patient goal attainment.

CHF example
In this example, the CHF program’s Qualifying Specialties parameter has identified a PCP, an ANP, Nutrition support, and Cardiology. The choice of provider specialties during POP program design is based upon the specialties needed to implement the specifics of the planned intervention The expectation for each provider is that he or she will practice medicine with little administrative interference. The best care for each patient is the goal.

The PBN is a way of looking at the overall process as it relates to the condition, CHF in this example. It is a window into situations such as quick follow up after a hospital discharge, allowing assessment of success or failure. The system creates this PBN view on demand whenever requested by program participants. Medical Management personnel use this view to identify progress toward meeting the goals of the community. (In the pilot CHF program, the goals address Brain Natriuretic Peptide (BNP) levels, Blood Pressure, and weight fluctuation.) Referring providers use it to identify those participating providers who can best meet the patient goal based on past performance.

A fundamental principle of POP is that the PBN is only composed of providers who actually care for the patient. The CHF example figure identifies that Cardiologist B meets the qualifying specialty of “cardiology”, but since B has not seen the patient, B is not part of this particular PBN created using this specified look-back period. This demonstrates that a program participating provider (identified by the Qualifying Specialties parameter) becomes part of this patient’s PBN only when services are provided to this particular patient. Likewise, the design of the program does not include the Emergency Department as a qualifying specialty; therefore, that specialty cannot elect to participate in this CHF program, and won’t share in the incentives if they attend to the patient. ED may have to attend to the patient at some time, but the design of the program uses the Qualifying Specialties parameter to discourage the use of ED care by making it less desirable.

It is possible that a patient can have multiple PBNs since the PBN is dependent upon the user’s defined look-back period. A particular look-back period might not include a participating provider that has seen the patient more recently (such as B in the example), outside of the look-back period’s time frame.

A complex patient has the heightened potential to be included in multiple POP programs. Therefore, the complex patient may have many more PBNs than a less complex patient has since there are more Qualifying Specialties and look-back periods available.

No matter what look-back periods are chosen by the user, or if the patient presents as complex or not, it is still the patient that is the common denominator at the center of all PBNs.

The Role of Virtual Teams in Program Oriented Payment (POP) Methodology

2011-11-28T15:11:00.000-08:00

by Michael Rohwer MD
Concept
The virtual team concept is an abstraction that helps to organize real world events in ways that lead to understanding and success.

This is analogous to the Problem Oriented Medical Record (POMR). Every complex patient, particularly when they are sick, presents the physician with a wide array of disparate data items. Complicating things further, each item may have unique relationships to other items. The POMR, initially introduced by Lawrence Weed MD at the University of Vermont in 1969, is a structure through which problems can be isolated, understood and managed effectively. A virtual team is similar to POMR but as a method of looking at therapeutic community data within the context of a specific problem.

Consider a patient who has congestive heart failure. In many situations, the patient will also have renal insufficiency and obstructive lung disease. They may have a wide array of contributing and complicating metabolic disturbances such as diabetes. Electrolyte abnormalities are common and eventually rhythm disturbances will be part of the picture. What is known about each of these conditions has been learned by isolating and separating pathophysiology in combination with well-controlled clinical trials to produce specific guidelines and best practices. All providers are expected to understand specific best practices and apply them appropriately to complex patients. Knowledge gaps are unavoidable so referrals to specialists are common. With each new provider, management complexity grows along with an inability to view overall process and outcome.

The virtual team concept is a way to isolate, understand and manage the interactions of the patient’s specific providers within the context of an important problem. While integrating technologies such as electronic health records can create visibility to individual data items, an organizational construct such as the virtual team is needed to convert that data to usable community level information.

Perspectives

There are many examples where a structured view of community performance is needed. A few are listed below.

Referring provider
A primary care provider (PCP) has a patient with severe systolic heart failure. As the patient becomes more complex, the PCP may choose to ask a specialist to manage part of the care and a nutritionist to help manage diet. From the perspective of a POP CHF program, a virtual team represents the community’s management strategy surrounding each and every patient in the program. The team and its working relationships are responsible for the successful management of the patient. In this example, it starts as a team of one; the PCP. The addition of consultants raises the team member count to three. Because reimbursement (POP methodology) is tied to success, the PCP wants to choose new teammates who have a proven record of accomplishment in the community.

Program design

Programs that operate under POP are created to achieve a necessary community goal. A successful program contains an intervention that is likely to succeed. Success is based on a theory of assessing how the community of providers interacts to achieve the desired result. Program design establishes relative incentive payments as well as the expected outcome. The virtual team construct is the method used to visualize how providers interact, monitor performance, and determines whether success has been achieved at the community level.

Medical Management

Medical management personnel are responsible for community wide goals such as individual provider results and responsible cost management, To do this they need to be able to isolate performance by problem and to be able to examine the collective team member performance in resolving the problem. This requires a consistent way to view individual teams. The virtual team concept provides this through a consistent abstraction with which POP can create useful management information.

How Program Oriented Payment Avoids Patient Dumping

2011-10-28T08:32:00.000-07:00

by Michael Rohwer MD
Patient dumping is a potential issue in all pay for performance (PFP) strategies. Private health insurers as well as providers often maximize their rewards by eliminating (dumping) difficult patients. Program Oriented Payment (POP) methodology intrinsically manages this issue.

POP, like most PFP programs, is patient centric. Incentives result from the achievement of a specific clinical goal in the individual patient. POP intelligently manipulates these incentives to address the dumping issue.

Diluting the influence of an individual patient
The primary program target is to achieve the patient goal in every patient. To sharpen the focus on the patient goal, a separate provider goal that determines payment is defined. The provider goal is usually a formula based on patient goal achievement. The simple version uses a basic percentage model. This provides

· A mechanism for incremental goal setting to accommodate a developing capability within a community

· Incentive payments for the care of participating difficult patients that are based upon an aggregate performance of all program patients cared for by the provider.

It is important to note that while reducing patient dumping, the problem may still exist when a provider’s percentage of difficult patients approaches the boundary of the provider goal.

Design new program around difficult patients

What distinguishes POP methodology-based programs is a consistent configuration method and standard claim data outputs. Program design requires the translation of a clinical program into a payment program. This is an active process of learning and redesign.

As an example of how this works, consider the following scenario.

Assume the creation of a program for moderate diabetes. The member goal is defined as achieving a HbA1c level <= 7%, an annual retinal examination, and regular foot checks. Providers receive payment when they achieve the member goal in 70% of the program’s patients. From the provider goal portion of the program, they may receive incentives for the remaining 30% of patients who do not meet the goal.

The program needs to be refined by identifying characteristics of the difficult population and designing a specific new program for them. The level of adaptability needed to accomplish this is possible within the scope of POP methodology.

Consider a sub-population of diabetes where patients also have a major mental illness. This group is addressed by creating new member and provider goals to accommodate their specific problems. In such an intervention, HbA1c with the delivery of a social support function such as individual healthcare support personnel can be the combined target, as diagramed in the graphic.

The result is two programs with each targeting a specific condition. Payment and accountability are condition specific. The number of patients receiving appropriate results is increased. This is also a more intuitive and implementable approach to the problem of addressing severity of illness variations between populations or providers.

Using POP, difficult patients are not problems to avoid; they are desirable members of an inclusive community with a treatable condition.

Robert Wood Johnson Foundation Site Visit

2011-10-21T07:24:00.000-07:00

by Lew Hundley

The Robert Wood Johnson Foundation will be visiting PH Tech on November 4, 2011.

RWJF is “the nation’s largest philanthropy devoted solely to the public’s health”. Physicians Choice Foundation (PCF) of Salem, Oregon, has been awarded a grant under the "Payment Reform for High Value Care" program. The program operated by PCF is the "Program Oriented Payment Demonstration Project".

Cascade Cardiology Agrees to Support New CHF Quality Improvement Project

2011-10-19T09:49:00.000-07:00

by Lew Hundley
Cascade Cardiology of Salem, Oregon has signed on to implement and support the inaugural implementation of a PH Tech Program Oriented Payment (POP) based Congestive Heart Failure (CHF) improvement project. This project consists of POP programs designed by Cascade’s Dr. Rene Ratkovec in consultation with Dr. Michael Rohwer, CEO of PH Tech and innovator of POP methodology and its development.

The design and configuration phase of the CHF program is targeted to be complete by year’s end, with implementation to begin January of 2012

Transitions of Care Programs

2011-10-15T08:17:00.000-07:00

By Michael Rohwer MD
Programs that reduce cost by improving transitions of care are another example of where Program Oriented Payment (POP) supports change. There are many transition models throughout the country. One example is the National Transitions of Care Coalition (http://www.ntocc.org). These programs seek to improve quality and reduce cost by improving the transition between care settings. One common place where the “ball gets dropped” because of potentially preventable readmissions is the hospital discharge.

A specific example is the WVP Health Authority’s version of a TCP. At the heart of their program is an active case management component called the transition care team (TCT). Typically, this team consists of nurse case managers, home health, Patient Centered Medical Homes, hospital based case management and community health worker / navigators.

TCTs in some form exist in each community entity with WVP serving as the responsible central coordinating organization.

On discharge from the hospital, the patient is stratified to home health or an individualized care plan.

If the patient requires home health, care is coordinated through the TCT until the patient can be moved to an Individualized Care Plan (ICP)

The ICP uses Community Health Worker / Navigators to facilitate the key services necessary to complete a successful transition.

Hospital follow up for serious illness is planned to occur within 2 days.

POP supports the transition program in several ways. Initially the cost of readmission is extracted to provide initial costs and financial accountability for savings as the TCP moves forward. The POP program creates incentives tied to an intermediate outcome; in this case, a two-day follow-up of the patient. This creates additional value around the first visit following hospitalization.

POP provides a goal-based transparency used to validate results and associated financial savings, and supports the accountability of risk sharing.

Hospitalization for a serious illness or chronic disease such as CHF or COPD, combined with an ineffective care transition, creates a patient that is a prime candidate for readmission. The POP program framework, easily incorporated with any existing performance-based chronic disease initiatives, increases the chances that there will not be a readmission. This provides the patient with a healthier outcome, and the plan with improved care at lower cost.

Managing Interactive Benefit Plan Choices

2011-09-30T14:02:00.000-07:00

By Michael Rohwer MD

The Program Oriented Payment (POP) methodology provides tools to create a new type of interactive benefit plan. POP designed programs provide interactive options for both providers and members. These options, and by association, the plan, are interactive because the ability to choose individual disease treatment is new. Members can choose to participate in their care based on treatment needs rather than just the cost of a plan’s offerings. Providers are able to make choices that address the level of patient care (by joining specific programs that apply to individual patients) not offered by other plans. And the Plan has choices through the parameters of a program defining the health issue and the qualifications required to treat the issue.

Important Concepts
Providers have more participation requirements than members do. Member requirements are to present the health issue and to meet the symptom levels and measures as defined by the program.

The following paragraphs explain some of the important concepts used by POP programs that affect how an interactive benefit plan is managed.

Agency (Agent): This concept is derived from the PH Tech CIM security model. There is an option where the user (person or organization) grants the right of commitment to another entity. This entity is referred to as an “agent”. For example, in the case of a provider, the provider can grant agency to a clinical administrator. Individual providers are agents for themselves by default. Important to this concept is that only agents can register or subscribe to programs.

Vendor registration: Billing processors are referred to as “vendors”. An example would be a multi-practice office that bills for services and receives and disperses payments for the providers in the office. A vendor must be an agent for the provider(s) that want to participate in a Plan’s POP program.

The first step is vendor registration. By registering, the vendor is stating that they will receive and disperse the payments from the POP program.

The registration process consists of the vendor being shown an online document that explains the POP level rights and responsibilities. By indicating acceptance of the terms in the document, the vendor enters into a contractual relationship with the Plan that is an extension of their existing health plan contract. (The steps of the registering process will be covered in a later article).
Provider registration: When a vendor registers with a Plan’s POP program, all providers that are already under contract to the Plan through the vendor are eligible to register as program providers.

The provider registration is similar to the vendor registration. The provider must provide or confirm their primary specialty and is shown an online document that explains the Plan’s POP level rights and responsibilities. Indicating acceptance, like with a vendor, extends their existing health plan contract to include the POP program(s). (The steps of the registering process will be covered in a later article).
Registration with one Plan vendor does not mean that a provider is eligible for the same program participation through another plan vendor. The provider must be registered through each Plan vendor that submits claims for the provider’s services. The provider does not have to be registered through all Plan vendors that are participating on a POP program; only the ones where the provider expects to see and participate in the program with Plan members.

Program subscription: Subscribing to a POP program is how providers and members exercise their benefit plan choices.
Providers can access a program’s subscription process when their vendor(s) has registered, the provider has registered, and the provider’s specialties fall within the scope of the program.

Members are allowed to subscribe when they have a condition that falls within the scope of the program parameters. In a primary care POP program, most Plan members are included by default. Specialty POP programs are limited to the specific conditions the programs address.
Similar to the registration processes for the vendors and providers, subscription presents incentives, rules, rights and responsibilities of the program for the subscriber to read and accepted. (The particulars of subscription will be covered in a future article).

Unregister or Unsubscribe: Vendors, providers and members are not locked in for the life of a POP program. This is part of the interactive Plan choices afforded by POP. Withdrawal from a POP program is very similar to signing up to participate. The main difference is that instead of being presented the rules and benefits, there is text explaining the consequences of withdrawal. The user must accept the terms to complete the withdrawal process.

The process of registration and subscription
Registration and subscription are multi-step processes, with some steps appearing to be inconsequential and bureaucratic. The processes are specifically designed this way because they produce a legally binding agreement and must be clearly understood and accepted. The desirable affect is to give the user every opportunity to understand the agreement they are making and not complete the agreement if they don’t. In addition, the Plan receives confirmation that the user is who they claim to be and that they have the ability to affirm the agreement.

The following is an overview of the processes using the previously described concepts. PH Tech’s CIM 4 platform is the delivering application.
The registration and subscription processes are basically the same with the differences being the final results and the terms that are presented.

Registration is the domain of vendors and providers. Subscription is the domain of vendors (as an agent for providers or members), providers and members.
Registration of the vendor and provider is a pre-requisite for subscription

Registration process has three status states:
·         registered
·         pending registration
·         not registered

Subscription process also has three status states:
·         subscribed
·         pending subscription
·         not subscribed

Both registration and subscription begin with by accessing the CIM 4 program registration web page. This can only be done by a security-registered user with agent rights. A combination of options (vendor registration, provider registration, or program subscription) is available to the user-agent depending upon the process status of the represented entity (vendor, provider, and member).
All of the options follow the same general steps.

·         User-agent selects an option
·         An agreement listing the rights and responsibilities associated with the option is displayed
·         The user-agent email address on file is confirmed (there is no method in this process to change the email address)
·         User-agent signifies that the agreement is understood by clicking on the button for acceptance (a cancelation button is available if the user-agent does not want to agree)

The CIM 4 program application marks the request as pending and sends an email containing all of the information the user-agent approved to the user-agent and the represented entity. The email contains acceptance and cancellation hyperlinks to CIM 4. The user-agent uses the proper link to confirm acceptance or cancel out of the agreement. CIM 4 receives the notification and updates the request status (registered; not registered; subscribed; not subscribed).

Improved Utilization Management

2011-09-23T08:44:00.001-07:00

By Michael Rohwer MD

Interactive benefit plans are made possible because Program Oriented Payment (POP) methodology provides the tools that allow a focused approach. How POP might influence quality improvement or case management is obvious. What is less obvious is how an interactive benefit plan or POP can change necessity or utilization management (UM).

Health insurance is a contract with the insurer that specifies a list of benefits¹ and the rules governing when the beneficiary qualifies for them, and how the provider is compensated. This combination of benefits and rules are referred to as a benefit plan. UM, a critical role performed by the medical management staff for most health plans, is the process that most effects costs and quality.

Many commercial health insurance carriers have simple benefit plans reflecting the lower risk of the population they serve. The plan may be nothing more than a list of eligible procedures and a subset of the list that requires prior authorization. Prior authorization evaluation is based on establishing that the item being authorized is medically necessary, determined by using standardized compilations of the best evidence available. At the other end of the spectrum, Medicaid plans have to manage the most difficult patients with lower budgets. This has resulted in a restricted set of benefits and complex rules governing what a beneficiary is qualified to receive and when it is appropriate.

Thus, a benefit plan is very important. For the rules that govern payment, an underwriter or actuary provides a projection of costs based on a specific set of assumptions. The reliability of the projections depends on a reproduction of the assumptions in an appropriately managed benefit plan model.

Too often, members or providers do not see the contractual relationship they have entered into is limited to a specified set of benefits. Often, the specifics of the benefit plan are not easily understood by members during the enrollment process. Providers have a similar dilemma. They work with multiple plans and it is difficult to be continually aware of the nuances governing each plan. Both POP and interactive benefit plans improve these drawbacks by making the benefit plan and rules visible. Misunderstandings are eliminated. The work of the medical management staff is reduced by increasing the clarity of, and access to, the data related to the underlying questions

PH Tech currently administers the Oregon Health Plan (OHP) for WVP Health Authority using tools designed to support the standard level of utilization management that the industry deems adequate. The OHP is a complex plan that can benefit from an improved UM process. By the end of this year, POP-designed tools will be implemented for OHP. The derived data will deliver the needed transparency that can elevate UM to the higher levels discussed in this article, and improve costs and quality for OHP.

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¹For this discussion, a benefit is an item for which a payment might be appropriate under certain conditions

Healthcare Integration Using Program Oriented Payment

2011-09-16T14:46:00.000-07:00

By Michael Rohwer MD

The strength of Program Oriented Payment (POP) is that it is a problem-oriented goal-based incentive. The consistent platform enables implementation of many types of incentive programs, or, alternatively, the distribution of a single program to multiple communities. Standard Electronic Data Interchange (EDI) provides a method to extend existing payment methods.

Every POP program is implemented using a common set of configuration parameters. Incentive payments are made using a secondary payment process implemented using the POP methodology. This process is shown below.

Within a single health plan, all qualifying providers have the same set of goals. Together they form an ad-hoc or virtual team of providers serving the patient in the context of the incentive program. All incentives come through the same payment system.
There are situations where cooperative integration outside a single plan would be advantageous. An example is when a regional provider organization wants to implement a common incentive program with several health plan partners. Another example is when a plan specializing in mental health shares patients with a plan specializing in physical health. This second example demonstrates the potential for social service agencies to join a mental health oriented program when patients might have complicating social conditions that affect medical quality or cost.

POP can create a unified approach to patient care in a way that allows the individual payers to cooperate with minimal disruption to existing operations. The core requirement is that the patient goal for the program be the same.

Example 1: Multiple competing insurance plans using a single Independent Physicians Association (IPA) managed program to improve an important medical condition

In this scenario, each member has a single set of coverage. All providers who care for the member have the same provider contracts with the plans regardless of whether it is primary or secondary coverage. For this example, identical programs are defined for each plan and operate in parallel. Performance definitions and results are identical, as is the type of output. Information derived from parallel operations is comparable and aggregated accurately.

Example 2: A single group of patients with overlapping coverage e.g. Mental Health and Physical Health plans

In this scenario, each member has dual primary coverage based on the type of condition. This is seen when mental health coverage is separate and overlaps physical health; a situation common to Oregon Managed Medicaid.

For optimal management, the actions performed to reach the patient goal are implemented without involving unnecessary and potentially counterproductive integration. Examples of difficult integration elements are incompatible management approaches or specialized payment models and finance. In the current system, integrating activities that are not related to the care of the patient consume large amounts of resources and energy. The implementation of POP programs eliminates a majority of these losses.

Providers receive incentives calculated according to their plans’ rules. A single patient goal binds the two programs together. The ad-hoc (virtual) team that is formed around the patient consists of a set of providers from either plan who care for the patient. All are rewarded for patient goal success regardless of their discipline.

An example of a program where this can be applied is patients with severe medical conditions that are complicated by mental health conditions. In this situation, demonstrated by the flowchart, the integration of care coalesces around the goal based secondary payment system.

Using POP programs, dissimilar delivery and payment systems can be integrated around common goals in an easily implemented manner. From this, an integrated and consistent set of data is produced that addresses clinical and financial accountability, allows for better assessments of performance, and becomes a consistent and reproducible implementation engine for putting what is learned into practice.

Interactive Benefit Plans and Institutional Care

2011-09-09T15:33:00.000-07:00

By Michael Rohwer MD

Previous articles in this series addressed interactive benefit plan advantages for primary and specialty care. This article discusses institutional care and how it can be augmented.

An interactive benefit plan, implemented for primary or specialty care, supports a member’s involvement and plan/provider partnerships by exercising small, but important, choices with consideration given to understandable tradeoffs.

Institutional care is different in that once it is necessary, the member choice and, to a large degree, physician choice, is limited. An interactive benefit plan in an institutional care setting provides choices that are acceptable and made in advance of when needed. These choices are based on better information derived from POP program metrics and actual performance data. Later in the timeline as more data is collected, incentive programs support institutional change and transparent results.

The interactive benefit plan options are POP-derived incentive programs that pay institutions for meeting important goals. Program members are aware of, and encouraged to use, a participating institution when the program gives them a vested interest to do so. It may be some component of their care they can affect by making a choice to use the institution. By placing these choices and tradeoffs in the benefit plan, both parties must agree to the program’s process to receive benefits. Doing so supports and encourages commitment and understanding from all participants.

For example, consider one hospital that has an active POP incentive program to reduce readmissions for congestive heart failure. The program is properly configured with an “outpatient follow-up after discharge” intermediate goal. This allows the hospital to realize increased funding in the form of the goal’s incentive payment. Meeting this goal also extends the preservation of their DRG payment rates by preventing readmissions. Patients who have serious congestive heart failure conditions are notified by their health plan or PCP about the hospital’s active and effective program. The patient can then pre-select and plan to use the hospital based on the information that tells them that this hospital provides better support of their condition.

This example demonstrates two core health plan functions: the member is assured of getting the best care possible; and a better value for the resources available is realized. As a bonus, POP creates health plan loyalty in members, and performance based partnerships with providers and institutions become the norm.

For physicians, their ability to evaluate the performance of the institutions they use improves. Rather than depending upon institutional advertisements as the predominant source of quality information, a POP program provides hard, unadulterated data and information about the institutions.

Institutions are provided a means of connecting performance to reimbursement while creating a more substantial differentiation strategy in the marketplace.

Program Oriented Payment and Institutional Care

2011-09-01T09:41:00.000-07:00

By Michael Rohwer MD

Program Oriented Payment (POP) is a methodology for designing incentive program that can be applied to in-patient and other institutional settings. Like all POP programs, an incentive program is designed by applying a configuration that matches the needs of the institution. See the description of the parameters and an example of their usage.

Institutional care is often expensive. When care is necessary, the treatment emphasis is on the avoidance of complications and preventing the need for readmission following discharge. Failure is often not knowing or following best practices, not anticipating a preventable condition, or an inappropriate response to an unexpected event. Many failures derive from random biological events outside the providers’ control, but too many are human error.

Opportunities vary between institutions. The concept of Potentially Avoidable Complications (PAC) is defined and has been tested by the PROMETHEUS® Payment model[i]. These may account for up to 28.6% of the cost for six chronic conditions[ii]. PAC affects readmissions and with the coming rule changes, will soon affect the Medicare reimbursement rates for hospitals.

Candidates for a POP incentive program’s intermediate patient goal, such as the use of recommended medication, post-operative therapies and ambulation, coincide with treatment options that have been shown to prevent PAC conditions. Likewise, readmissions are often the result of not following up in a timely manner after the patient leaves the hospital. This time-to–appointment-after–discharge measurement is another good candidate for an incentive goal intermediate measure.

The Qualifying Specialties parameter specifies needed expertise for the incentive program. Providers outside of the institution’s system can participate in a program (within boundaries). By participating, the providers share in incentive rewards for achieving program goals. For example, a PCP not affiliated with the institution might be a participant in a program where incentives are attached to a rule for “timely follow up after discharge”.

As stated here, POP methodology can be applied to Institutional care as well as many other healthcare entities. POP programs provide an additional strategy, using goal based payments, for healthcare to address financial and clinical accountability.

[i] PROMETHEUS Payment Model is a registered trademark of Health Care Incentives Improvement Institute, Inc.

[ii] Health Serv Res. 2010 Dec;45(6 Pt 2):1854-71. doi: 10.1111/j.1475-6773.2010.01136.x.

Program Oriented Payment and Specialty Care

2011-08-23T16:27:00.000-07:00

Program Oriented Payment (POP) is ideal for specialty care incentive-based payment initiatives. Payment of incentives is in real time based on clinical results; much better than the current scenario.

Specialty care is different from primary care in a variety of ways. There is more to it than a narrow focus on particular organ systems or conditions. Complex and costly patients are the province of specialty care. Primary care is in a fundamentally different business. Prior attempts to push complex (specialty) care back to the PCP has failed to improve quality or lowered cost. To achieve either of the objectives, the specialist’s role and responsibility has to be re-envisioned. A narrowing of scope to each specific problem is required along with coupling clinical outcome to payment. This is exactly what POP does.

In 2010, in one of the health plans using PH Tech payment services had approximately 50,000 members. Of these, 929 had claims for Congestive Heart Failure (CHF). Less than 40 patients accounted for 50% of the overall cost. The largest contributor to that cost was the hospital where the top 40 patients were responsible for more than 70% of hospital payments. Managing and identifying these patients early requires specialty, not primary care focus.

The following example, using the CHF data cited above, demonstrates how POP methodology can re-organize payment appropriately. This example references the POP configuration parameters.

The example program is based on identifying the small number of patients who have severe or complicated CHF. Improvement depends on a focused, more than a general, response.

A conventional initiative would define the final goal to be the lowering of hospitalization rates. In the POP methodology, that goal has too many factors outside of the provider’s control. Instead, POP requires an achievable intermediate goal that reduces the need for hospitalization. This is defined in the POP program’s configuration parameters as the “Patient Goal”. For a CHF program, there are many combinations of outcomes that can define the Patient Goal. For this example, three outcomes have been chosen:

Unless there is a reported contraindication, the patient is on a Beta-Blocker, ACE Inhibitor and spironolactone
AND the patient’s weight is measured regularly and does not fluctuate more than 5% around a specified target
AND patients who call for appointments receive a call back within 1 hour, 60% are seen that day and everyone is seen within two days

Monitoring for achievement of this goal is through claim system adjudication and payments are made using the claim payment system.

The next step in defining the example CHF program negates providers from bias patient selection by rewarding the care of difficult patients when a provider meets some aggregate performance standard. To specify this, the “Provider Goal” configuration parameter is set to 60%. The claim system pays an incentive payment when 60% of patients in their care meet the “Patient Goal”.

Not every provider has a role in treating severe CHF. Rewards are focused on the team that can achieve the goal. The “Qualified Specialties” parameter addresses this. For this CHF program, the parameter has cardiologists, nutritionists, nurse practitioners and primary care providers identified as the type of provider needed by the program.

While a full implementation of the CHF example involves the other POP configuration parameters, the parameters addressed in this article are what separate a severe CHF specialty incentive program from a primary care approach. POP focuses on specific clinical results, not general practice functionality, thereby optimizing the care for a small number of medically important patients.

The same underlying technology and methods support clinical and financial accountability for any specialty problem. A consistent configuration allows for local and regional variation in meeting national goals. Standard processes and outputs create a way to compare results and the effectiveness of clinical guidelines.

Interactive Benefit Plans and Specialty Care

2011-08-23T16:26:00.000-07:00

By Michael Rohwer MD

In a previous article of this series, Patient Centered Medical Home (PCMH), a primary care program, is discussed as part of an interactive benefit plan. This article addresses specialty care programs and interactive benefit plans.

Specialty programs have fundamentally different issues and goals from their primary care counterparts. Program Oriented Payment (POP) methodology is presents a new way to manage specialty programs (“Program Oriented Payment and specialty care”).

A dynamic and interactive benefit plan creates choices for both members and providers. Choices within a benefit plan allow both providers and members to focus on an option and consider any associated tradeoffs. The availability of this as a tool creates member loyalty and provider partnerships that best serve the needs of all parties.

All benefit plans seek to encourage greater value. For specialty problems, the value is tends to address important conditions by improving the quality of delivered care and/or mitigating the associated costs. Specialty based choices are available and easily fit within a benefit plan structure. Using POP methodology, both clinical and financial accountability can be isolated to the scope of the condition and not influenced by the related artifacts that conventional initiatives must deal with out of necessity.

The companion document, “Program Oriented Payment and specialty care”, uses a Congestive Heart Failure (CHF) POP program as an illustrative example. Although the example program addresses one specific small part of CHF, it serves to show that an overall CHF problem is made up of many smaller, individual problems. For an operating health plan where many important specialty based problems exist, similar to CHF, there can be a one-to-one ratio of POP programs to each elemental problem. An interactive benefit plan allows the patient and provider to choose how best address the issue, and the plan manager better management of the benefits with improved accountability data.

For providers, the option is whether to participate or not. Participation brings with it additional payments. Those payments are coupled to specific clinical outcome requirements intended to reduce cost and / or improve quality.

Members with a severe condition cannot opt out of POP programs where they are qualified to participate. Their eligibility is determined by the Patient Goal parameter. However POP methodology allows creation of incentives for members in the same way it provides incentives for providers. By participating in a POP program members may become engaged enough to take control of their condition. This can occur directly through the benefits of better care. Additional examples of member incentives include plan deductible changes or gift card initiatives using regional retailers

Plan managers receive more specific data allowing a fine tuning of the POP programs in the beginning, and, later, a better offer of benefits and costs due to the improved data.

POP is a vehicle whereby we can redesign the payment of health care incrementally. It provides clinical and financial accountability for each step and engages providers and members around in key choices without requiring them to select a new health plan. Its methods are applicable to the all parts of the system.

Next in this series: Solutions to institutional problems

Patient Centered Medical Home (PCMH) Programs

2011-08-01T13:57:00.001-07:00

Program Oriented Payment (POP) is a flexible methodology that supports many goals. It is applicable to broad based initiatives as well as narrowly focused specialty or high cost issues. POP’s configuration parameters are what make it both accommodative to local realities and portable to the broader community.

PCMH has goals that are a natural fit with what POP addresses. It is applicable to different goals by changing the configuration. The following narrative demonstrates configurations that reward PCMH compliance.

The first example uses criteria specified in an Oregon Department of Medical Assistance Programs (DMAP) document, Appendix C. It specifies three tiers of PCMH compliance. Each tier represents greater compliance with the PCMH goal.

A change to three POP configuration parameters is all that is needed to support PCMH. First, because payment is based on the provider meeting the PCMH compliance criteria, the Patient Goal is not used. Second, the Provider Goal is configured to match the PCMH requirements. Lastly, the Virtual Team definition that specifies the providers who may participate is restricted to the primary care specialties. Configuration of the remaining parameters, primarily affecting payment formulas and the patient, is no different for PCMH than any other program.

Since there are three tiers of compliance, a family of three programs is created. Within a family, only one program pays the incentive. In this example, the payment would be made for the highest level of compliance. The program specifies “Per Member per Month” (PMPM) payments because that matches the value structure coming from DMAP.

The example’s three program family addresses DMAP’s goals of capability and process improvement. POP methodology can be used to stretch beyond these goals and create a fourth tier that addresses quality improvement. This fourth tier could measure actual patient accessibility to their provider based on how long they must wait for an appointment. Implementing this change requires only two modifications; one to the Patient Goal, the other to the Provider Goal. An example is the addition of a Patient Goal that specifies the acceptable number of days between booking an appointment and the appointment date. The Provider Goal specifies a percentage of appointment requests that is less than or equal to the Patient Goal and is the value that the provider must meet or beat to be successful.

Three parameter changes convert the focus of a POP program from a specialty to PCMH. Upgrading a PCMH capability and process program to a quality improvement program requires only two parameter changes. The data output of the two example programs remains the same so the results are comparable in terms of outcomes and cost. The programs’ interpretations of the defined goals are the difference, and contribute to the uniqueness of the POP methodology.

Interactive Benefit Plans and the Patient Centered Medical Home (PCMH)

2011-07-31T13:58:00.000-07:00

This is the second in a series describing how Program Oriented Payment (POP) can support dynamic interactive benefit plans. See “Patient Centered Medical Home (PCMH) Programs” to see how POP rewards compliance with PCMH.

All benefit plans seek to encourage greater value. An interactive benefit plan adds choice on the part of members and providers. POP methodology provides clinical and financial accountability.

Members and providers views vary in terms of what they believe have value in a benefit plan. The current plan paradigm asks purchasers to change health plans in order to meet their needs, most involving trade-offs they do not understand. A benefit plan comprised of incremental choices and associated trade-offs will better serve purchasers, members and providers. In addition, it can create plan loyalty and sustainable partnerships.

Consider the choice between Per Member per Month (PMPM) and Fee for Service (FFS) payments. PMPM can offer a consistent funding stream for providers and predictability for plans. At the same time, both have supporters among members and providers. POP based payments can support both payment options allowing providers and members a wider choice within some definable constraints. There are many permutations of the problem.

As an example, envision a PMPM funded PCMH inside a PPO plan. The goals of the POP program design are

encourage primary care providers to improve access and services to plan members
monitor performance
improve cost predictability

To accomplish these goals primary care fee schedules under the base PPO plan are changed to implement greater cost sharing by the member. Two POP programs are then created.

The first implements a PCMH delivery model and a PMPM incentive structure. This pairing is expected to provide a wider array of services for the member such as email support and greater provider accessibility. The provider gains more freedom. “Value delivered” is measured using POP methodology parameters, providing a way to judge if payments are justified.

The second POP program operates under a FFS model. The PCP may or may not meet PCMH standards. The POP program is designed with a different, and perhaps lower, set of expectations.

It is important that these choices and the relative payments be actuarially sound. POP methodology provides a simulation feature that helps calculate the plan’s maximum exposure should choices be different that expectations.

Providers can choose their preferred model. Because POP is a transparent payment system, they have information to base their choice on. New choices could be offered on a regular schedule to better serve market needs.

Members have access to information regarding provider payment and the expectations of payment. This allows them to make an informed choice between the greater access and service attached to a fixed monthly provider payment or a fee for service approach where on the one hand, cost is not incurred for services not used, but traditionally non-covered services (e.g. telephone consultation) are also less likely to be available

A health plan serves to clarify the choices available within the framework of an interactive benefit plan. Through this vehicle, members and purchasers are given a transparent understanding of key issues. Providers are given choices that are relevant to the market and the freedom to practice in a style that best suits them.

Next in this series: Improving specialty care

Ranae M Ratkovec M.D. Joins POP Project

2011-07-31T13:57:00.000-07:00

PH Tech is excited to announce the addition of Dr. Ratkovec to the POP project team.

Dr. Ratkovec is a practicing cardiologist with expertise in Heart Failure, Transplant Cardiology, and Pulmonary Hypertension. She is a former Assistant Professor of Medicine at Oregon Health Sciences University, Division of Cardiology: Heart failure and transplantation.

The first prototype POP program addresses Congestive Heart Failure. Dr. Ratkovec will be the subject matter expert (SME) for the design, implementation and evaluation of the program. (More on this team role in Newsletter Vol 1, Number 4.)

PH Tech is providing new payment and analysis opportunities with POP programs. Dr. Ratkovec will work with WVP Health Authority (POP beta team member) to design practical and implementable programs, and then analyze outcomes of congestive heart failure patients in the community (the initial target population) utilizing POP methodology. Her assessments will be crucial in refining programs and have a positive impact on the evolution of future design methods.

Look for future newsletter articles about Dr. Ratkovec’s assessments and experience with POP programs

Creating Dynamic Interactive Benefit Plans

2011-07-15T13:54:00.000-07:00

Program Oriented Payment (POP) methodology addresses the improvement of the administration of health finance and payment. During development of the POP strategy, a tangential benefit became apparent; the ability to create dynamic interactive benefit plans. This idea presents a huge opportunity to any commercial or government based health insurance.

Most benefit plans are basic statements of coverage. Provider contracts define the payment arrangements. Within this structure, change occurs with renewal, when members and providers can seek or accept new arrangements. Individual provider or member choice is limited. Systemic change appears only to involve discussions of copayments and out of pocket maximums. Regional changes trend toward “one-off” pilot projects that often depend on a specific community. Current benefit plans are locked into this cycle by the limited scope for new ideas and the inability to implement them effectively.

As an example, consider the HMO plans of the 80’s and 90’s. Initially they reduced cost. In many cases quality improved. Yet, the lack of flexibility and options for the two most important components of healthcare, providers and patients, led most HMOs to failure.

Dynamic interactive benefit plans broaden the possibilities. By creating options and choice, members and providers can seek what is best for them. At the same time, real-time information regarding their preferences can be collected and analyzed by the plan for fine-tuning of current and future offerings. This new type of plan management can drive outcomes toward lower costs and higher quality.

These new designs use the same systems that support POP methods. Provider choices are implemented with on-line supplemental agreements covering payment and performance benchmarks. Member choices operate in the same manner using member- appropriate rewards. The POP methodology utilizes virtual groups of providers formed around care for the patient and the common acceptance of payment and performance rules. Collaborative arrangements are built around a specific goal. These are generic processes applicable in any community.

The upcoming POP-based special payment programs beta testing will offer a real-world demonstration of how choices and data analysis come together to allow the conception of new benefit plans.

This is the first in a series of articles about dynamic interactive benefit plans and its components and processes. Implementation can lead to improved member and provider satisfaction, initiate a major shift in how health care is financed, and act as a transitional path into programs that improve health care quality and lower its costs.

Our next article in this series describes a more detailed example of an interactive benefit plan that supports the Patient Centered Medical Home (PCMH).

POP and the Oregon Coordinated Care Organization (CCO)

2011-06-30T10:22:00.000-07:00

PH Tech’s claims management application, CIM, currently has most of the capabilities needed to implement Oregon’s proposed CCO concept. Program Oriented Payment (POP) helps complete the CIM suite of tools when implemented with CIM 4, allowing full support of a CCO. Although the CCO rules have yet to be finalized, PH Tech is confident that the POP methodology is flexible enough to implement whatever is approved. The CCO concept is a basic Accountable Care Organization (ACO) with additional layers of public and consumer governance. Creating a process and workflow that works in the real world will not be easy. The advanced development of CIM services with the CIM 4 upgrade, combined with POP’s powerful structure, is a step ahead in the pursuit of CCO compliance.

All CIM services are accessible from a web browser. Authorized users have a wide range of data elements and summary reports at their command. The enhancements provided by the CIM 4 / POP combination allow a CCO to define a clinical member goal for every problem/program.

The member goal creates

true financial accountability: A member goal provides the context necessary to convert data into transparent information. Cost, one of a CCO’s premiere targets, becomes meaningful when directly connected to the problem and the result.
real clinical accountability: A member goal is tightly bound to outcomes, not process.

CIM 4 and POP have benefited from PH Tech’s current business experiences:

a family of services encompassing physical, mental and oral health
administration of commercial self-funded and institutional markets
participation in a triple-aim project to bring mental and physical health together
administration of Medicaid, dual eligible Medicare, and Medicare advantage
statewide use of services representing regional governance and priorities

The common services used by these business entities enable common solutions spanning diverse health care models. All the needs are addressed by how the CIM system is designed and built.

The CIM 4 implementation of the POP concept of virtualized provider teams fits nicely with the CCO vision. Within a given geographical region adaptive sub-groups can deal with special patient / member problems or situations. Examples would be

· unique payment arrangements for high cost conditions or situations

· special patient centered medical home arrangements

The CIM 4 / POP model supports networking of independent provider groups. Their benefits are

· shelter from the monopolistic power of institutions

· the development of accountable common infrastructure necessary for fair and open competition

PH Tech’s core business is health plan administrative services. Current CIM services plus the innovative methodology provided by POP make possible the management of regional diversity within the purview of global risk.

Not lost on the CCO transition team is that these problems are not limited to government programs. Cost is driven by the nature of the health care system itself. POP virtual teams and outcome-based payments can change the underlying nature of healthcare relationships leading to better results and lower cost.

Creating collaboration with CIM 4/POP

2011-06-30T10:13:00.000-07:00

POP methodology is fundamentally collaborative around an important problem or issue. The CIM 4 platform has the tools to create collaboration through access to relevant information in a way that is transparent, integrated with a payment approach that is tied to a specific clinical goal. This collaboration is between all parties involved in a patient’s healthcare, including the patient.

The new functionality of CIM 4, when implementing POP methodology, enables a variety of new techniques essential to Accountable Care Organizations (ACO) or Coordinating Care Organizations (CCO). Current CIM 3 tools are capable of supporting these organizations, but POP methodology greatly extends this capability. Current PH Tech customers will experience a seamless upgrade of current CIM 3 functionality to CIM 4, and can also benefit from the new collaboration abilities.

The idea of collaboration and transparency is not new to PH Tech. The current CIM 3 platform supports a weak form of the collaboration discussed in this article.

The Connect portal is a secure website used by PH Tech-managed FSA and HSA benefit plan brokers, employers, and members. Through this portal they can view the plan’s data that affects them. For example, plan members can access their current deductible and out-of-pocket amounts and status. This helps them make decisions and manage their healthcare.

Similarly, POP program participants will be able to see data that helps them understand, among other things, how

a participating patient is progressing within a program
providers are faring within the program
the program is working, or not, to the benefit of the patient

Extending this further into the ACO and CCO, participants could

track expenditures and results in real -time
as patients provide important information that can be used to reward both providers and patients
communicate relevant information concerning patients with important conditions
as key case managers and providers, access a direct priority path for patients with important conditions
as members, track their progress towards reward payments for achieving important goals

Collaboration through portal access combined with ACO or CCO initiatives using POP program methodology improves and refines all aspects of the healthcare and patient improvement outcomes.

Designing Programs for POP: Condition definitions

2011-06-15T10:29:00.000-07:00

An earlier article¹ discussed identifying a condition that could benefit from a Program Oriented Payment (POP) program.

This article describes the definition of a Patient Enrollment Formula (one of eight formulae used by POP) and the information needed concerning the condition. The formula’s configuration parameters define patients who could benefit from a POP program and an associated intervention. As a key POP innovation, the formula’s use of relevant clinical terms creates a more complete condition description.

Once the generic costs and opportunities for a condition are known, the specific patient characteristics are considered. For example, in one dataset the expenditures for Congestive Heart Failure (CHF) in 2010 were $3.9M to treat 927 patients. Hospitalization accounted for $2.2M for the treatment of 162 patients (roughly 60% of total cost for 17% of CHF patients). Of all hospitalized patients, 37 accounted for 50% of expenditures; 95 accounted for 75% of expenditures. The number of total plan-covered lives was approximately 30,000. Does every practice need to be disrupted to make substantial change in a key condition? With the advent of POP, the answer is “No”.

The goal is to optimize the care for a specific set of patients whom are believed to be at a higher risk for hospitalization. The Patient Enrollment Formula defines which patients to track.

Purely for the sake of an example, define the target patients as:

Anyone hospitalized for CHF (claim search)
Anyone believed by a primary physician or cardiologist to be at high risk (referral)
Anyone with clinical evidence of NYHA functional class III or greater severity

The first two target identifiers are straight forward, even for a current system. The third requires a definition that uses relevant clinical parameters. For this, the following might be used:

(Hypertension AND history of Brain Natriuretic Peptide (BNP) level > 300)
OR (BNP level > 400)
OR (Hypertension AND Cardiac Ejection Fraction < 30%)
OR (Cardiac Ejection Fraction < 20%)

Clinical parameters combined with claims data allows the identification of patients eligible for a POP incentive / intervention program and improves tracking of the costs associated with their care.

Another clinical parameter, lack of a social support network, greatly raises the risk of hospitalization. Existence of this condition defines an important sub group, justifying the consideration of creating a separate POP program.

By defining programs based on clinical descriptions of patients targeted for improvement, the need for complex adjustments due to severity of illness is avoided. For POP, the condition and incentives are part of the program narrative.

¹POP Development Newsletter Vol 1 Num 2: Designing programs for POP: Selecting a condition