PEBB Cost Management Overview - Oregon · 2018-03-20 · • Since 2012: 22% PMPM increase & 7%...

© 2018 Private & Confidential

PEBB Cost Management Overview Presented: March 20, 2018


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Robert Gluckman, MD, MACP Chief Medical Officer

Cash Singleton Manager, ASO Account Services

Introductions

Presenters

Helen Noonan-Harnsberger, Pharm.D AVP, PHP Pharmacy


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Progress of health care management on behalf of PEBB

Questions

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Discussion Topics

Commitments to the 3.4% spending cap

Approaches to achieving the Triple Aim objectives


Administrative Fees


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Administrative Fees

2011-2014 fee renewals were held to 0% • Health Improvement Fund Investment

2015, 2016, 2017

• Fees reduced average of 38% • Capped 2016 and 2017 renewals at 3% per year • Added an incentive for PHP to earn based on meeting triple aim objectives

2018 fee renewal at 2.9%


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Fee increase for Jan. 1, 2019 – Dec. 31, 2019 = 0%

2019 Administrative Fee Proposal

Base administrative service fee increase 2.5% Triple aim incentives reduced to offset the increase

Providence Choice PEBB Statewide Base ASO (PEPM): $58.44 $40.92 Triple Aim Incentive (PEPM): $13.20 $13.63

Total Administrative fee 2019 (PEPM): $71.64 $54.55

Triple Aim Incentive is earned based on meeting cost, quality, and experience targets

Additional 5% of base ASO fees at risk for quality performance measures


Managing Costs


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Historical Trends – Allowed PMPM

7 year annualized trend from 2010 to 2017 is 2.8% despite increase in population risk

Introduction of new fully insured plans

Incurred and paid through 201802 with IBNR


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Historical Trends – Paid PMPM

2012 Rx rebates were used as a conservative estimate of both 2010 and 2011 rebates.

7 year annualized trend from 2010 to 2017 is 2.8% despite increase in population risk


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Historical Trends

• Member cost shares have remained relatively unchanged since the introduction of the deductible and additional cost tier

• The plan pays a larger percent of the total allowed amount each year


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PEBB Specific Financial Improvement Initiatives

Estimated PEBB savings using PHP Internal FIBO Model

Detail of 2017 Savings SavingsPharmacy Unit Cost $4,800,000Contracting $2,900,000Case and Care Management $1,000,000Pharmacy Site of Care $800,000Pharmacy Benefit Management $600,000Pharmacy Clinical Programs $600,000Coding $600,000Grand Total 11,300,000$

2016 2017Total Medical and Rx Savings PMPM: $8.63 $9.08Total Pharmacy Savings PMPM: $5.51 $5.47Approximate Total Medical and Rx Savings: $10,900,000 $11,300,000Approximate Total Pharmacy Savings: $6,900,000 $6,800,000


Managing Care


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Readmission Rates

Readmission rates, with Anchor Admissions from January thru Nov 2013 – 2017

Utilization management has significantly reduced PEBB Readmission rates to assist in keeping total IP Admission rates flat over this time


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Spine Fusion Site of Service

Bars = Utilization per 1000 Line = % Savings over IP Shift to OP setting results in total cost savings


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Knee Replacement Site of Service

Bars = Utilization per 1000 Line = % Saving over IP Shift to OP setting results in total cost savings


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ER Utilization as % of Total Membership

Increase is driven by members with only 1 visit per year suggesting issues with access

% of membership with 1, 2, 3, 4 or 5+ ER visits in one year


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Relative age/sex adjusted Allowed PMPM cost by ZIP code

PEBB’s cost vary by geography

ZIP codes with less than 100 member months are excluded

More costly regions include: • Northeast OR, • Southwest OR, • Mt. Hood region, • South-Central (Lake and Klamath) OR, and Less costly regions include: • Eugene, • Portland, • Bend, and • Seaside and Tillamook


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Relative age/sex adjusted utilization by ZIP code

ER use is higher in rural regions While specialist use is higher in Portland, Salem, and Bend


ER utilization per 1000 Specialist utilization per 1000


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Relative age/sex adjusted utilization by ZIP code

Portland, Eugene, Bend, Corvallis have low Rx utilization compared to other OR cities


Inpatient utilization per 1000 Rx utilization per 1000

No discernable pattern


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2018 Hospital Agreement Progress

2018 Contract Status

Marion/Polk community wide agreement tied to 3.4%Other county specific agreements tied to 3.4%<= 200%Exempt other – outside of Oregon and not contracted Exempt CAH A&BDRG exempt >40% Medicare will engageDRG Exempt Low PopulationDRG exempt >40% Below 250% Medicare


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History of Facility Rate Increases

* 13 Contracted Facilities with Highest Allowed Dollars * IP & OP Services, Rates Weighted by Allowed Volume

Historical network facility increases are below legislative mandate


Managing Care Pharmacy, Inclusive of Specialty


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2016-17 PEBB RX Trend Below 3.4% Budget Goal

Plan Paid Trend in boxes


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The Providence Model Integrated medical + pharmacy key to managing drug trend

Right drug • Formulary design, prior authorization, step therapy, quantity

limits, dose optimization, adherence tactics (ie: 90 day supply)

Right channel • Specialty pharmacy with best market rates, evaluation of buy

and bill vs. specialty pharmacy procurement

Right site of care • Preferred infusion centers, home therapy, ensuring safe and

convenient access at lowest cost

Right care management • Shared workflows, data integration, weekly high cost case

review with interdisciplinary team


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Anti-inflammatory agents (rheumatoid arthritis, inflammatory bowel disease) • Example: Humira, Enbrel • Since 2012: 22% PMPM increase & 7% utilization increase • PHP Solutions: Improved unit costs in 2018, dose optimization, quantity limits, price

protection rebates passed through 100% to PEBB Dermatological agents (psoriasis)

• Example: Stelara • Shift from medical cost to outpatient RX cost • Price inflation & utilization increase due to expanded indications • PHP Solutions: Quantity limits, price protection rebates

Multiple Sclerosis • Shift from medical cost to outpatient RX cost • Price inflation and increased utilization due to better tolerability and convenience of oral agents • PHP Solutions: Preferred products, rebate management, prescriber alignment with preferred

formulary agents

Top PEBB Cost Drivers: Specialty Drugs


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Evaluation of high cost drug cases under both the medical and pharmacy benefit by Specialty & TOC team

Specialty & Transitions of Care Team Management: High Cost Case Review

Intervention Identified

Outreach •To provider, case management, patient

Documentation in shared Healthcare Services Record

Monitoring

No Intervention Identified

Documentation in shared Healthcare Services Record

Monitoring


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Hemophilia • 16 PEBB members with hemophilia • Over $850,000 in savings in 12 months due

to rate improvements on factor replacement products

• Regular case review by Specialty Management team for appropriate factor use and no acute events

Dose & Therapy Optimization

• Conversion to more cost effective dosage form or change in therapy

• $217,000 in savings in 12 months

Spinraza – 2 new high cost cases in 2017 • Only FDA approved treatment for rare disease,

spinal muscular atrophy • Medical drug, intrathecal injection • Potentially lifelong therapy • Dose & indication reviewed & approved • New contracting secured in 2018 • Savings per patient treated

– $1.26 million in initial 12 months – $630,000/year for subsequent years of

therapy

Specialty & Transitions of Care Team Management: PEBB Intervention Successes


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Infusion Network Creating Preferred Infusion

Provider Network Best market rate for infusions Drug specific contracts Case-by-case evaluation of lowest

cost via specialty pharmacy channel vs. provider buy and bill

CAR T carve out • Savings per patient treated:

– ~$500,000 in drug costs • Outcomes based agreement

– No charge for product if no clinical remission at 30 days

Improved Unit Cost Twice yearly review of specialty market

pricing Achieve market-leading specialty drug rates,

coupled with high touch specialty care management

Rate improvements in 2018

Specialty & Transitions of Care Team Management: Contracting & Channel Management


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30% decrease in opiate use since 2013

30% decrease


Managing Quality Performance


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Philosophy Support primary care service delivery

that is patient-centered, comprehensive, team-based, coordinated, accessible, and focused on quality and safety

Comprehensive primary care models like PCPCH and CPC+ support population health efforts in Oregon

Empower medical homes to make data-driven changes

PCP Profiles


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PCP Profiles

Patient Panel Quality

Risk Efficiency

Launched streamlined, self-service interface for population health data reports in June

Providers served on committees to inform design

Continuously improving reports to meet provider needs and foster success in alternative payment models


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PCP Profile – Patient Panel

Panel profile helps providers know their PHP patients and describe panel characteristics, risk, and clinical registries

Provider feedback: need rosters for PEBB members to support alternative payment model agreements


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PCP Profile – Quality

Annual updates on metrics and specifications

Provider feedback: additional benchmark cut points


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• Drill down into service categories

• Risk adjusted PMPM compared to peers in region

• Distinguish price vs. utilization

• Uses well-established HealthPartners methodology

PCP Profile – Efficiency


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PCP Profile – Member Search

Providers requested ability to “look up” specific members to get a summary of clinical quality opportunities

New function supports a medical home best practice of pre-visit chart scrubbing


Questions?

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PEBB Cost Management Overview - Oregon · 2018-03-20 · • Since 2012: 22% PMPM increase & 7%...

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