ACHP Affordability Webinar: Specific Cost Savings Strategies Detailed


Date: December 17, 2014
Who: Stephen Perkins, M.D., Vice President, Medical Affairs,UPMC Health Plan

Tom Aubel, Director of Medical Payment Strategy and Policy, UPMC Health Plan

Gretchen Leiterman, Vice President, Operations and Hospital Specialty Services, HealthPartners

William Nelson, M.D., Ph.D., Department Head, HealthPartners Cardiology and Medical Director, Regions Hospital Heart Center               

Note: A copy of the slide deck is here and a recording is here.

On December 17, ACHP held a webinar on work to reduce the cost of health care, which featured presentations on two elements of cost reduction: bundled payment models and improved clinical efficiency. Steve Perkins, M.D., and Tom Auble presented on UPMC Health Plan’s total joint bundled payment initiative. Gretchen Leiterman and William Nelson, M.D., Ph.D., presented on HealthPartners’ work to more safely and efficiently treat low-risk chest pain patients.

As UPMC looked at an approach to bundled payments, initially focusing on total knee and hip replacements, it examined not only the cost structure for the health plan but also the efficiency structure for the health system. UPMC’s objective with the bundled payment initiative is to encourage physicians to deliver quality care across the entire episode of care in a cost-efficient manner. The plan has already created retrospective reconciliation shared savings arrangements and retrospective bundled payment models. Prospective bundled payment and global capitation models are currently under development. Buy-in from the provider community is critical to developing successful payment models and developing the most effective quality and utilization benchmarks. UPMC has divided the bundles into five core types of measurement: one month pre-operative care, the surgery itself, readmission/reoperation rates, one month post-operative status and three months post-operative status.

One of UPMC’s programs is a shared savings initiative for total hip and knee replacements. The program, piloted from July 2013-July 2014, was for both commercially insured and Medicare Advantage members. Currently, it is open only to UPMC system facilities. To build the shared savings model, UPMC separated professional and ancillary services from operating room supply costs. Shared savings are between the health plan and physician for professional and ancillary services, and between the hospital and physician for operating room supply costs. To help improve efficiency and quality, UPMC shares a report with each individual physician that highlights adherence to care pathways, readmission rates, blood utilization and patient satisfaction. Providers are also given information on cost that compares them with other providers, focusing on both specific costs of procedures and overall cost variation.

In more than 835 surgeries to date, 86.3 percent of physicians have adhered to the care pathway, which is significantly above the original goal of 60 percent. These successes have led to reduced cost per case, and financial bonuses for the hospital and physicians. Future bundled payment initiatives include obstetrics, COPD, hysterectomies, congestive heart failure and coronary artery disease.

HealthPartners’ low-risk cardiac protocol efforts include the low-risk chest pain protocol, and work with congestive heart failure (CHF) and low-risk atrial fibrillation. The low-risk chest pain protocol was implemented in 2011 and emerged from collaboration among cardiology, emergency medicine and hospital medicine. The aim is to standardize care for low-risk chest pain patients to improve patient experiences, ensure safety using evidence to guide treatment and reduce costs to the system. The guidelines were developed based on TIMI Risk Scores, which categorize a patient’s risk of death from heart disease. Based on this evaluation, patients designated as low risk are sent home and scheduled for an outpatient stress test the following morning. More than 2,000 patients have benefited from this program at Regions Hospital alone and safely avoided unnecessary care, for a system savings of $4 million. Most of these cost savings result from the differences between observation status payments and emergency room treatment.

The success of the low-risk chest pain program led HealthPartners to consider other areas where patients could be safely treated in a more efficient manner, including congestive heart failure (CHF) and low-risk atrial fibrillation. The CHF protocol began in 2012, and emergency department trends demonstrate higher use of observation status and discharges to home after this program was initiated. The low-risk atrial fibrillation program has led to a drop in inpatient admission status and a movement toward observation status. This has led to reduced costs to the patients and the system overall. (Note: Full details on the clinical criteria for both programs are available in the slide deck.)

In addition to a question-and-answer session at the end of the presentation, the group also held a discussion on new cost-savings work at ACHP in 2015, as well as other cost-reduction initiatives at ACHP plans. Plans expressed interest in the challenges in building cost-reduction programs with network providers as opposed to integrated delivery systems, and driving patients to the most cost-effective site of service. Other attendees expressed interest in strategies for reducing pharmacy costs. Both topics will be examined as part of ACHP’s ongoing work in 2015 to highlight cost reduction strategies.