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ALAMO FAMILY HEALTHTEAM 1

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Market Overview

Fee-For Service Value-Based Service

Demanding price increase from payers

Consolidating market position

Locking up referral stream Minimizing total cost

Delivering better quality

Expanding total patient volume

Alamo Family Health

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Scenario

CMS has enacted regulatory changes cited in the Medicare Access & Chip Reauthorization Act of 2015 (MACRA)

MACRA

Reimbursement by federal government via value-based payments over the next several years

VALUE-BASED PAYMENT

Need to develop multi-year approach that will minimize negative financial impact from transition in payment models

MULTI-YEAR APPROACH

Alamo Family Health

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Our Organization

10% Medicaid

30% Medicare

60% Commercial & Other SAN ANTONIO

11.49%65 years or older55% Hispanic or Latino

8 FT-family physicians

$11M Revenues

25 Patients/physician/day

Alamo Family Health

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Operational Plan

MERIT-BASED INCENTIVE PAYMENT SYSTEM (MIPS)

• Addresses multiple quality

reporting programs

• Encourages efficient patient care

• Offers our practice the greatest

potential for adjustments to

offset financial impact of MACRA

QUALIFYING FOR MIPS

• Evaluation on 4 measures:

Quality, Advancing Care

Information, Clinical Practice

Improvement Activities, and

Resource Use

• Selected measures to match

health needs of our patient

population without imposing

significant resource burdens

Alamo Family Health

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Quality Measures

BODY MASS INDEX (BMI) SCREENING AND FOLLOW-UP PLAN

COLORECTAL CANCER SCREENING

DIABETES: FOOT EXAMFALLS: RISK ASSESSMENT

(CROSS CUTTING MEASURE)

DOCUMENTATION OF CURRENT MEDICATION IN

THE MEDICAL RECORD (HIGH PRIORITY MEASURE)

SCREENING FOR HIGH BLOOD PRESSURE AND

FOLLOW-UP DOCUMENTED

Alamo Family Health

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Advancing Care Information (Required)

Alamo Family Health

E-Prescribing

0%

Security Risk Analysis

0%

Health Information Exchange

20%

Provide Patient Access

20%

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Immunization Registry

Reporting

Patient-specific

Education

Medication Reconciliation

View, Download, or Transmit

(VDT)

Secure Messaging

Advancing Care Information (Additional)

Alamo Family Health

10% Each

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Improvement Activities Resource Use

CMS calculates based on claims, so no reporting requirements

Medication Management Practice Improvement

Manage medications to maximize efficiency, effectiveness and safety

Use of Certified EHR to Capture Patient Reported Outcomes

EHR

Alamo Family Health

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EHR Implementation

COSTSBENEFITS

Increase the efficiency of our practice

Implementation cost and annual fees

Centralize patient data

Allow patients to take control of their care through patient portal

Staff cost savings

Initial provider training

Alamo Family Health

Temporary reduction in patient volume

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Increased Community Presence

Businesses Schools

Potential to shift patient mix to include more commercial payers

INCREASE CUSTOMER VOLUME

Establish relationships with prospective patients

CUSTOMER RELATIONSHIPMANAGEMENT

Employees can benefit from health screenings without taking time off

ACCESSIBILITY

AlamoFamily Health

Alamo Family Health

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Additional Quality Measures

Sponsorship

Sponsor annual walk/5K to increase awareness for colon cancer screening awareness

Community Outreach

Partnership with charitable community organizations and host info sessions on good nutrition and heart health, encourage clinic

visits for preventative care screenings

Alamo Family Health

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Going Beyond 8 to 5

Implementation of weekend and evening hours

Two extra nurses practitioners

by 2018

Nurse hotline Secured physician

e-mail portal

Alamo Family Health

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Current Financial State

Alamo Family Health

Total Costs = Total Revenue

Total Physician Cost

Building and

Occupancy Cost

Medical and Surgical

Supply Cost

Ancillary Services

Cost

Other General

Operating Cost

Total Support Staff

40%33%

Medicare Patients Increase

30%

2016

31%

2017

32%

2018

33%

2019

34%

2020

35%

2021

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Financial Effect of Transition

• Change in payer mix – from growth rate of over 65 population in San Antonio

• Change in patients/daybased on EHR and productivity

ASSUMPTIONS

• Reduction in support staff• Improved office

utilization through extended hours

• MIPS adjustments

FINANCIAL IMRPOVEMENT

• EHR Implementation• Bringing on additional

staff to cover extended hours

MAJOR COSTS

Alamo Family Health

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Five Year Forecast

Alamo Family Health

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

2016 2017 2018 2019 2020 2021

Profit Margin

Profit Margin (Bonus)

Profit Margin (No Payment)

Profit Margin (No Participation)

Profit Margin (Penalty)

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Five Year Forecast

Alamo Family Health

Year 2016 2017 2018 2019 2020 2021

Revenue

Medicare Revenue 3,149,280 3,218,619 3,847,251 3,877,013 4,066,714 4,255,816

Medicaid Revenue 640,354 627,547 614,996 602,696 590,642 578,829

Other 7,776,000 7,659,360 7,542,720 7,426,080 7,309,440 7,192,800

Total Revenue (Bonus) 11,565,634 11,505,526 12,004,967 12,382,020 12,565,135 12,869,366

Total Revenue ( No Payment) 11,565,634 11,505,526 12,004,967 11,905,789 11,966,796 12,027,445

Total Revenue (Penatly) 11,565,634 11,505,526 12,004,967 11,429,557 11,368,456 11,185,524

Total Revenue (No Participation) 11,565,634 11,505,526 12,004,967 11,429,557 11,488,124 11,546,347

Costs

Total Physician Cost 4,626,253 4,626,253 4,626,253 4,626,253 4,626,253 4,626,253

Total Nurse Practitioner Cost 0 180,000 360,000 363,600 367,236 370,908

Total Support Staff 3,816,659 3,702,159 3,517,051 3,341,199 3,174,139 3,015,432

Building and Occupancy Cost 925,251 925,251 925,251 925,251 925,251 925,251

Medical and Surgical Supply Cost 693,938 690,332 720,298 685,773 689,287 692,781

Ancillary Services Cost 578,282 575,276 600,248 571,478 574,406 577,317

Other General Operating Cost 925,251 920,442 960,397 914,365 919,050 923,708

EHR Implementation 234,000 80,000 80,000 80,000 80,000

Total Costs 11,565,634 11,853,713 11,789,499 11,507,919 11,355,622 11,211,650

Net Income (Bonus) 0 (348,188) 215,468 874,101 1,209,513 1,657,716

Net Income (No Payment) 0 (348,188) 215,468 397,870 611,173 815,795

Net Income (Penalize) 0 (348,188) 215,468 (78,362) 12,833 (26,127)

Net Income (No Participation) 0 (48,687) 355,860 (110,222) (62,783) (15,622)

Profit Margin (Bonus) 0.00% -3.03% 1.79% 7.06% 9.63% 12.88%

Profit Margin (No Payment) 0.00% -3.03% 1.79% 3.34% 5.11% 6.78%

Profit Margin (Penatly) 0.00% -3.03% 1.79% -0.69% 0.11% -0.23%

Profit Margin (No Participation) 0.00% -0.42% 2.96% -0.96% -0.55% -0.14%

• Different scenarios

• Net impact

• EHR

• Margin comparison

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Conslusion

Alamo Family Health

Trasition from FFS to VBS

Additional Quality Measures

MIPS

EHR Implementation

Selected Quality Measures

Financial Forecast