‘I can tell you our pa­tients are afraid’

Modern Healthcare - - Q & A -

“If you think about things from the pa­tient’s point of view, we can bet­ter man­age peo­ple in pop­u­la­tion seg­ments than we do in the cur­rent out­dated pay­ment mech­a­nism.”

The health­care de­bate cur­rently rag­ing in the na­tion’s cap­i­tal is de­void of one key con­stituent—the pa­tient, ac­cord­ing to Dr. Nick Turkal, CEO of Aurora Health Care, a

15-hos­pi­tal in­te­grated sys­tem in Wis­con­sin. Any con­ver­sa­tion around health re­form, he said, should cen­ter on ac­cess, cov­er­age and af­ford­abil­ity. Turkal would like to see the de­bate shift to find­ing ways of en­sur­ing that pa­tients have ac­cess to high-qual­ity care. He re­cently spoke with Mod­ern Health­care Man­ag­ing Ed­i­tor Matthew We­in­stock about the ef­fort to re­peal and re­place the Af­ford­able Care Act, as well as Aurora’s at­tempts to re­tool how care is de­liv­ered. The fol­low­ing is an edited tran­script.

Mod­ern Health­care: What con­cerns do you have for Aurora Health Care and your pa­tient pop­u­la­tion as the Se­nate con­tin­ues work­ing on its ver­sion of a bill to re­peal and re­place the Af­ford­able Care Act?

Dr. Nick Turkal: Ob­vi­ously, 23 mil­lion peo­ple los­ing cov­er­age is a great con­cern, but I’d like to talk a lit­tle more specif­i­cally about what con­cerns us most. The low sub­sidy lev­els that ex­ist in the cur­rent ver­sion of the Amer­i­can Health Care Act are go­ing to make cov­er­age un­af­ford­able for a lot of peo­ple. In Wis­con­sin, we tend to have a dis­pro­por­tion­ately higher share of older en­rollees. We take care of many peo­ple who don’t have a lot of means, so the cur­rent ver­sion (of the AHCA) is very con­cern­ing.

The Med­i­caid cuts are con­cern­ing in a dif­fer­ent way be­cause Wis­con­sin is not a full-ex­pan­sion state. We par­tially ex­panded, but that means the sub­si­dies are lower, and it means fewer dol­lars for tak­ing care of Med­i­caid re­cip­i­ents.

MH: Can you put that into per­spec­tive of what that could mean? Do you ex­pect to see bad debt rise and more char­ity care? What are the real-world im­pli­ca­tions?

Turkal: It would be log­i­cal to as­sume that if we see fewer peo­ple with cov­er­age or peo­ple who are un­able to af­ford cov­er­age that we will end up see­ing in­creases in bad debt and char­ity care. The other thing that con­cerns me is go­ing back to peo­ple com­ing to the emer­gency room in cri­sis rather than get­ting the pre­ven­tive care and pri­mary care that they need. That’s not an ef­fi­cient way for peo­ple to get care.

In Wis­con­sin, over 50% of the mar­ket­place are at less than 250% of the fed­eral poverty level, so you can see what’s go­ing to hap­pen with fewer peo­ple be­ing cov­ered.

MH: One of the other im­pli­ca­tions in the AHCA is that hos­pi­tal lobby groups sup­ported the Medi­care cuts that oc­curred in the Af­ford­able Care Act with the prom­ise of more peo­ple be­ing in­sured. The AHCA tries to get at some of that by the higher dis­pro­por­tion­ate-share hos­pi­tal pay­ments. Are those suf­fi­cient?

Turkal: No. The way the for­mula would work for those DSH pay­ments, we would not see a lot of ben­e­fit, and it would go pre­dom­i­nantly to other states. So, it would ab­so­lutely not come close to re­cov­er­ing for us what we gave up in the Af­ford­able Care Act.

Now we’re look­ing at a pic­ture of fewer peo­ple cov­ered and lower pay­ments agreed upon for the ACA that are not be­ing re­stored. Over­all, it’s a bad sit­u­a­tion for pa­tients and a bad sit­u­a­tion for health­care providers.

MH: You’ve talked about some­thing that’s miss­ing from the cur­rent de­bate—the pa­tient. Can you ex­pand on that?

Turkal: From the pa­tient’s per­spec­tive, any­thing that is done to health­care ought to ad­dress sev­eral main ar­eas. First and fore­most, it’s cov­er­age and ac­cess. Peo­ple need to be cov­ered and they need to have ac­cess to high-qual­ity health­care providers. Af­ford­abil­ity is the next thing. You have seen the sta­tis­tics of what is hap­pen­ing in the coun­try right now around af­ford­abil­ity, so any­thing that is put in

place needs to be af­ford­able for a large per­cent­age of peo­ple; it should not dis­pro­por­tion­ately dis­ad­van­tage the poor. And then, fi­nally, we have to pro­vide over­all value to pa­tients, and that means high-qual­ity care; it means man­ag­ing them ac­cord­ing to their in­di­vid­ual needs.

If you think about things from the pa­tient’s point of view, we can bet­ter man­age peo­ple in pop­u­la­tion seg­ments than we do in the cur­rent out­dated pay­ment mech­a­nism. If I had the op­por­tu­nity to make a rec­om­men­da­tion and have ev­ery­body in Wash­ing­ton lis­ten, it would be a twostep ap­proach: Sta­bi­lize the in­di­vid­ual mar­ket in the short term, be­cause that pro­tects pa­tients, and then take a look at global re­form so that we stop nib­bling away at the edges of health­care re­form and do some­thing that sig­nif­i­cantly helps our pa­tients.

Un­for­tu­nately, the leg­is­la­tion as it ex­ists, speaks of pa­tients in the ab­stract, but these are real peo­ple with real is­sues who need health­care and I can tell you our pa­tients are afraid.

MH: Afraid of what?

Turkal: Afraid of los­ing cov­er­age, afraid of un­af­ford­able care, afraid that a pre-ex­ist­ing con­di­tion may ex­clude them from care in the fu­ture. And, cer­tainly, if you look at the pop­u­la­tion of real pa­tients that we care for, so many fam­i­lies are af­fected in one way or another by be­hav­ioral health or sub­stance abuse is­sues, and some of the changes that pro­pose to elim­i­nate ba­sic min­i­mal re­quire­ments in plans could be dev­as­tat­ing to fam­i­lies around those is­sues.

MH: Think­ing about the de­bate that’s go­ing on in Wash­ing­ton and some of the is­sues you have ad­dressed—af­ford­abil­ity, ac­cess and this idea of value—how do you ap­proach mov­ing to value know­ing that the big­gest payer may be cut­ting back even fur­ther?

Turkal: For most of my time as CEO at Aurora, we’ve been about re­form­ing health­care from the in­side. I’m com­ing up on 11 years as CEO and dur­ing that time we have moved our po­si­tion from the high­est cost to the low­est cost and the high­est qual­ity in east­ern Wis­con­sin. That for­mula is what needs to hap­pen in health­care across the coun­try: higher mea­sur­able qual­ity, lower cost. So, we’ve bent the cost curve.

If you look at episodes of care, if you look at com­mer­cial pop­u­la­tions that we care for, we have be­come very ef­fi­cient. There is more ef­fi­ciency to be had in health­care sys­tems and we’re anx­ious to get at that.

In our com­mer­cial ac­count­able care or­ga­ni­za­tion ap­proach, we have over 90% re­newals with the com­pa­nies that sign up. We tai­lor health­care to the needs of those em­ploy­ees. They have seen ei­ther flat or sin­gle-digit in­creases in pre­mi­ums over those past four years.

If you look at Medi­care in Wis­con­sin, the av­er­age ex­pen­di­ture per Medi­care ben­e­fi­ciary is over $1,000 less than the na­tional av­er­age, so we’re more ef­fi­cient in the way we’re uti­liz­ing re­sources here. I’m anx­ious to get at this with other pop­u­la­tions; we just haven’t grouped them the right way and we haven’t in­cen­tivized health­care sys­tems the right way over the past cou­ple of gen­er­a­tions.

MH: Your Medi­care ACO has done well too. In 2015, you had $ 5.6 mil­lion in sav­ings and about $2.6 mil­lion came back to you. What specif­i­cally have you done to re­ori­ent care in such a way that you have been able to drive that value?

Turkal: The sin­gle big­gest driver of im­prov­ing that cost po­si­tion has been uni­form qual­ity across the sys­tem. We be­gan over 15 years ago with mea­sur­ing qual­ity in hos­pi­tals and in out­pa­tient set­tings, in­cen­tiviz­ing our physi­cians and all of our ex­ec­u­tives around qual­ity out­comes. As we stan­dard­ized qual­ity and stan­dard­ized care, the costs have melted away. Then, as we have got­ten more so­phis­ti­cated, par­tic­u­larly in the past five years, we have a uni­form elec­tronic health record with Epic, so now we’re able to look at pop­u­la­tions, to look at dis­par­i­ties and dig into that data and make things bet­ter around both cost and qual­ity.

MH: You must have had some hic­cups along the way though, right?

Turkal: Early on, go­ing back about 15 years, I think we did some of the same things that were not ef­fec­tive. We tried to do gen­eral ed­u­ca­tion, for ex­am­ple, on di­a­betes care for our doc­tors, and what our doc­tors told us at the time is they know how to do the right care, they need the data on their pa­tients to make it bet­ter. So, we re­ori­ented our qual­ity around pro­vid­ing a feed­back loop of data to our physi­cians and nurses and phar­ma­cists so they could act on it.

One of my great sources of pride at Aurora is we have a sin­gle physi­cian group across the en­tire sys­tem. That group is re­spon­si­ble for our ser­vice lines across all set­tings.

MH: As you think about how you re­im­burse your physi­cians, have you moved away from the rel­a­tive-value-unit model? Are you look­ing at more val­ue­based pay for your doc­tors?

Turkal: We are. We have a physi­cian plan that al­lows us to grad­u­ally in­crease in­cen­tives for care of pop­u­la­tions. We won’t nec­es­sar­ily do that the same with all physi­cians. That’s part of the fi­ness­ing of this, to make sure that pri­ma­rycare physi­cians first fo­cus on pop­u­la­tion health. And so, we have a plan that still has a heavy em­pha­sis on RVUs, and as our pay­ment struc­ture changes we will grad­u­ally change that plan.

Peo­ple make the mis­take of think­ing of this like a point in time or a light switch that you turn on or off around pop­u­la­tion health, and, in fact, we’re go­ing to be in a mixed model of re­im­burse­ment for the fore­see­able fu­ture.

MH: What per­cent­age of your rev­enue is tied to an al­ter­na­tive pay model or a value-based model?

Turkal: It’s still the mi­nor­ity of the way we’re paid; 15% of our 2017 net rev­enue is pro­jected to be in ei­ther up­side-only or up­side-down­side risk agree­ments. De­spite that, we’ve em­pha­sized pre­ven­tion and well­ness. We think it’s the right thing to do cul­tur­ally and the right thing to do for our pa­tients.

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