San Francisco Department of Public Health : Readiness for Health Reform Health Management Associates Presentation to the SF Health Commission October 1, 2013
SFDPH Under Health Reform: Opportunities • Health reform will move many currently uninsured patients into coverage that could bring in additional revenue to support the services provided by SFDPH. • Newly covered patients, and current MediCal patients, will move into managed care plans that will require that patients receive access to a full array of health care services—most all of which are currently provided within the SFDPH system. • SFDPH has always cared for these patients and has unique experience that will be critical in shaping a care model that addresses their needs. • The experience with Healthy San Francisco has helped SFDPH define needs and utilization patterns of the patient population who will moving into coverage. • SFDPH has long-established partnerships—SF Health Plan, Consortium Clinics, UCSF, CBOs, etc.—that will be beneficial in meeting the demands of the new paradigm.
SFDPH Under Health Reform: Challenges • Because Healthy San Francisco has covered most previously uninsured, it will be important to keep those patients already in the SFDPH system—only about 1/3. • SFDPH has a wealth of high quality and comprehensive services, but they have often functioned in silos; further, institutionalization has been emphasized to a greater degree than in the country as a whole and will be problematic under managed care. • SFDPH will need to meet managed care requirements to keep patients, including timely access to services, coordination between all levels of care, and accurate data reporting. • Financial accountability will be critical to assure appropriate allocation of resources. • SFDPH will need to enter into creative relationships—with new expectations and assurance of performance-- with their partners to assure a comprehensive network in which its patients are cared for in the right place at the right time.
SFDPH-HMA Partnership in Readiness for Reform • SFDPH has been preparing for reform for more than two years and has involved all levels of the Department in the planning process. • The focus of HMA’s effort over the past six months has been to partner with SFDPH leadership to develop a truly “integrated delivery system” that assures effective use of all SFDPH resources to address reform challenges and opportunities. • Work has been accomplished through assessment of findings, Action Teams, concentrated coordination with SFDPH leadership. • HMA has been facilitating the production of deliverables in critical areas: • overall change management and organizational development; • managed care strategy and interim staffing/leadership; • clinical reorganization, with a particular focus on ambulatory care; • financial forecasting, tool development, strategy going forward.
General Findings: Clinical Organization • SFDPH has excellent people, facilities, and a scope of services beyond any similar system in the nation. • There is the opportunity to build a national model for comprehensive management of the population’s health by connecting current programs, contractors, primary care, and hospital components—but need to significantly change current approach. • Services currently operate in silos, with multiple case management programs and different information systems, etc. There is the potential for patients to be lost between the levels of care or services to be duplicated.
Clinical Organization, continued • Primary care access to a Medical or Health Home is a critical requirement for the patients to be served within SFDPH, and the capacity exists if productivity and limitations on infrastructure—phones, IT—are addressed. May need an interim “surge” to keep existing patients. • SFDPH clinical organization and budget allocation heavily focused on institutionalization (acute IP, LHH) and housing at a level that appears excessive compared to other safety net systems. Patients “get stuck” at different levels— this can lead to poor patient outcomes and critical financial problems for the system.
Clinical Organization, continued • Behavioral health is a major opportunity for SFDPH but it needs to be better integrated into the delivery system. More than 60% of BH patients currently get primary care outside of SFDPH (or not at all). • Access to outpatient specialties will require significant collaboration with UCSF to assure that resources are allocated to meet the needs of SF Health Network’s population, including both SFDPH patients and those referred by partners. • Laguna Honda Hospital is a critical partner in assuring that patients do not remain in acute inpatient care unnecessarily and building services (i.e., rehab) for the entire network and potentially other contractors.
Clinical Organization, continued • A system-wide approach to IT is critical for meeting managed care reporting requirements, for assuring transferal of patient information throughout all levels of the network, and for maintaining and evaluating utilization and quality performance metrics. This is an investment that must be made. • The SFDPH currently does not evaluate its performance as a “system,” but, rather, as individual components. The model of care must be set throughout all levels of care and the evaluation must be built around the success in assuring that all of the network’s patients got the right care at the right place at the right time. • SFDPH has strong and smart delivery system leaders that can be brought together to form an integrated network. Medical staff leadership will need to be cultivated as well.
General Findings: Finance and Managed Care • Limited financial information and tools have been given to managers to assure accountability. • The growth rate in SFDPH spending is approaching 7% (i.e., wages/benefits, UCSF contract, CBO contracts)—although not enough on critical infrastructure. • There is a flat or decreased revenue forecast (i.e., realignment, no supplemental for Covered California, decreased DSH, no supplemental for duals impacting LHH, DSH will no longer pay for excessive number of admin and denied days at SFGH)—and this forecast assumes ALL CURRENT PATIENTS ARE RETAINED. • The lack of IT is a critical financial and managed care problem. • Managed care will require holding entire system—not silos—accountable. • Unlike other communities, little back-fill of patients after health reform. • Clinical change (i.e., primary care access) will be critical to take advantage of State initiatives like 75% auto-assignment to County systems.
Finance and Managed Care, continued • There was no vehicle for retaining Healthy San Francisco patients going to the insurance exchange (Covered California). • Needed contractual partners to fill hospital as, under managed care, SFDPH patients would not be enough to fill acute beds with appropriate patients (currently, extremely high level of patients who don’t need to be in the hospital). • The estimation of the new hospital transition costs will require significant planning for the role of SFGH in an integrated delivery network. • There was no comprehensive SFDPH Managed Care Office. • Out of Network costs are high and need to be contained—in connection with clinical organization transformation into one delivery system. • Overall high costs will be detrimental in contract negotiations. • UCSF-SFDPH contract should be examined to align accountabilities and incentives in preparation for health reform.
Examples of Initiatives for Financial Performance • Physical health utilization improvements, denied administrative days, and LOS • Behavioral Health reduction in denied days • Out of network costs • LHH rehabilitative focus • Reduction in need for Patch Payments • Nurse staffing • Primary care shadow panels • Conversion of behavioral health only patients to SFDPH complete coverage • Specialty physician billing
Projected Trend of FFS, Managed Care, DSH and Realignment Revenues FY13-14 Budget and Forecast Years 1 - 5 ($000) $1,000,000 $900,000 125,651 101,237 Realignment 101,237 101,237 101,237 101,237 $800,000 87,940 91,045 119,290 111,088 118,764 118,685 $700,000 DSH 115,141 234,155 $600,000 216,758 201,778 188,775 161,329 $500,000 Managed Care $400,000 (Capitation) $300,000 555,351 470,184 471,351 472,492 468,551 469,001 FFS $200,000 $100,000 $0 FY2013-14 FY2014-15 FY2015-16 FY2016-17 FY2017-18 FY2018-19 Budget (Year 1) (Year 2) (Year 3) (Year 4) (Year 5)
Actions Taken to Address Findings • Organizational structure for SF Health Network developed, action targets established, leadership positions drafted and recruitment underway. • Financial tools developed and are being implemented. • Vehicle established for keeping Covered California lives. • A Managed Care Office has been established. • Agreement between SFDPH and UCSF has been reached to make managed care capitation more transparent. • New opportunities have been identified for increased reimbursement for LHH and primary care within SFDPH. • A financial forecasting tool has been developed to allow assessment of financial impact of variables—as much is likely to change. • Review of current UCSF contract completed to identify priority areas for discussion. • Began the development of a new structure for SFDPH finance to support integrated network.
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