PROPRIETARY & CONFIDENTIAL – © 2016 PREMIER, INC.

Hospitals & Health Systems MACRA Strategies

Blair Childs, Senior Vice President, Premier healthcare alliance

PROPRIETARY & CONFIDENTIAL – © 2016 PREMIER, INC.2 PROPRIETARY & CONFIDENTIAL – © 2016 PREMIER, INC.

Transforming Healthcare Together

SCALEAlliance of ~3,750 (78%) hospitals, ~130,000 non- acute providers and 1.2 million cliniciansIntegrated clinical, financial, operational data – insights into ~40%

of U.S. health system discharges Approximately $44 billion in supply chain spendManage ~2,000 contracts from ~1,100 suppliers

ALIGNMENTMembers own ~74% of equity*10 health system board members Premier field force embedded in member hospitals

COMMITMENTMember owner average tenure ~15 years (80% at 10+) Members view Premier as strategic partner

CO-INNOVATIONCo-develop solutions with membersCommittees composed of ~163 member hospitals~1,200 hospitals in performance improvement collaboratives

Note: Data as of June 30, 2015.

Premier is a provider-driven healthcare performance improvement company. We co-innovate solutions with our members to reduce costs,

improve quality, and produce better patient outcomes.

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Sally Hartman, Senior Vice President, Riverside Health System

John M. Colmers, SVP, Health Care Transformation and Strategic Planning

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MACRA reform timeline (Medicare Access and CHIP Reauthorization Act of 2015)

2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025Permanent repeal of SGRUpdates in physician

payments

APM participating providers exempt from MIPS; receive annual 5% bonus (2019-2024)

Merit-Based Incentive Payment System (MIPS) adjustments 2019

+/-4%2020

+/-

5%2021

+/-

7%2022 & beyond

+/-

9%

20184%

PQRS pay for reporting2015-1.5%

2016 & beyond-2.0%

Meaningful Use Penalty (up to %)2015-1.0%

2016-2.0%

2017-3.0%

2018-4.0%?

Value-based Payment Modifier 2015

± 1.0%2016

± 2.0%2017

+2/±4.0%

MIPS exceptional performance adjustment; ≤

10% Medicare payment (2019-2024)

2026

0.5% (7/2015-2019) 0% (2020-2025)

0.75% update

2017-3.0%

2018±2/±4.0%

Measurement period

Measurement period

0.25% update

Riverside snapshot

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primary markets, with 

services in two others

8,000

square miles

10,000 team members

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Riverside Health System Footprint

3 divisions

Acute Care Services5 acute care hospitals754 beds

3 specialty hospitals222 beds

Lifelong Health 10 nursing homes943 beds

3 PACE centers Helping 600 nursing‐home eligible participants stay in their homes

In‐home health

•Home Health

•Home‐enabling technology

•House calls

Riverside Medical 

GroupMedical home model

•110 practices•565+ providers•35 specialties

45% 25% 30%

Market Characteristics

• One dominant commercial payer 

• Physicians predominantly aligned/employed by health systems or 

part of large multispecialty physician groups

• Significant differences within sub markets within service area –

Examples: demographics, rural vs. urban, competitors vary, differing 

health and social issues

MACRA Work in Progress at Riverside• Physician alignment strategies

• Compensation plan redesign• Incentive redesign

• Re‐organizing into Community Health Networks by geography• Focus on cost containment• Clinical process improvement and standardization• PCMH recertification (NCQA)• Epic EHR implementation• MACRA Roadmap in development

Future/Strategic Decisions for Riverside

• Attribution Strategy• Should we participate in MSSP?  Which track? What is the future of 

this program?

• With effectively one commercial payer, how do we want to think 

about commercial insurance risk?

• Should we change the way we evaluate new MD hires relative to 

quality profiles?

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• Johns Hopkins School of Medicine

• Johns Hopkins Alliance for Patients (JMAP) –

ACO • 6 member hospitals• 820,000 annual patient visits

via Johns Hopkins Community Physicians at 39 primary and specialty care practices

• 130,000 adults and children in central MD treated by Johns Hopkins Home Care Group

• 345,000 people covered by Johns Hopkins Healthcare’s managed care plans

• Johns Hopkins School of Medicine

• Johns Hopkins Alliance for Patients (JMAP) –

ACO • 6 member hospitals• 820,000 annual patient visits

via Johns Hopkins Community Physicians at 39 primary and specialty care practices

• 130,000 adults and children in central MD treated by Johns Hopkins Home Care Group

• 345,000 people covered by Johns Hopkins Healthcare’s managed care plans

Johns Hopkins Medicine Overview

Source: JHM Fast Facts

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4,500+ international patients and 5,700+ out-of-state patients

facilitated by Johns Hopkins Medicine International

Johns Hopkins Medicine InternationalReach

Johns Hopkins Medicine: Fast Facts

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Employed Physicians

•2,700 full-time faculty

•1,250 part-time faculty

•360 Johns Hopkins community physicians

•70 specialty physicians

Member Hospitals

•Johns Hopkins Hospital

•Johns Hopkins Bayview Hospital •Howard County General Hospital•Sibley Memorial

Hospital•Suburban HospitalJ h H ki All

Statistics

•$8 billion in operating revenues

•2.8 million-plus annual outpatient visits

•360,000-plus annual ER visits

•150,000-plus annual hospital admissions

In Maryland…Things are Different

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An all payer system that is accountable for the total cost

of care on a per capita basis is an effective model for

establishing policies and incentives to drive system

progress toward achieving the three part aim.

Maryland All-Payer Model •All-payer global budget for hospital inpatient and outpatient care•Medicare beneficiary savings of .5%/year - $330 M within 5 years

• 55% of Medicare Parts A+B covered•Medicare total cost of care guard rail•Quality metrics…. Expectation is to develop total cost of care model by 2019

Hospital Care Improvement Program (HCIP)• Designed for hospitals and providers practicing at hospitals• Focus on efficient inpatient care and effective transitions of

care• Goal: Facilitate improvements in hospital care that result in

care improvements and efficiencyComplex and Chronic Care Improvement Program (CCIP)

• Designed for hospitals and community providers and practitioners

• Focus on complex and chronic patients• Goal: Enhance care management

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Care Redesign Amendment- Change to the current waiver

Two initial care redesign programs aim to align hospitals and other providers

• Hospitals can select which program to participate in

• Goal to reduce potentially avoidable readmissions

• Reduce rate of growth in Medicare total cost of care (Parts A&B)

• Primary care model aligned to CPC+

• Dual eligible model– Dual Eligible ACO/PCMH– Medicaid leading state workgroup

• Geographic model– Very early stage– Geographic vs. attribution

• Design efforts to be MACRA compliant - leading to treatment as an advanced Alternative Payment Model (APM)

• Plan due to CMS 12/31/16

Progression Plan- Phase 2 of the waiver

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Preparing for MACRA

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QUESTIONS?

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