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Supplemental Payment Case Study

Intensive Outpatient Care Program - The Boeing Company[1]

Introduction

The Boeing Company (Boeing) is a large aerospace company based in Seattle, WA, with a significant concentration of employees in the metropolitan Seattle area. It has successfully experimented, as described below, with making supplemental payments to a special type of medical home, focused on serving employees and dependents with the highest levels of clinical risk.

At a Glance…

What motivated Boeing?

• Boeing felt that the current model of health care delivery was leading to sub-optimal quality, poor experience, and waste of valuable resources. It further believed that something bolder than incremental change was necessary and that completely different models of care needed to be tested.
• Boeing believed that employers, and not providers, are most likely to lead significant change in care delivery because providers fear change, don’t always recognize the need for it, and are not encouraged to change with the existing payment system.

• Boeing’s objective was to test an innovative health care delivery model designed to treat its sickest employees.
• The new health care delivery model would be informed by two considerations:
  • 20% of a predicted high cost population utilize 80% of health care spend, and
  • individuals with multiple, complex conditions are underserved by the current, fragmented, inefficient health care delivery system
• Boeing’s specific goals for the new health care delivery model were as follows:

• reduce net total health care spending forthe target population by 20% over 2 years;
• improve performance on chronic disease measures, both claims-based adn clincial data-based measures;
• improve patients' experience of care across all dimensions in a standard survey;
• individuals with multiple, complex conditions are underserved by the current, fragmented, inefficient health care delivery system
• Boeing’s specific goals for the new health care delivery model were as follows:
  • reduce net total health care spending for the target population by 20% over 2 years;
  • improve performance on chronic disease measures, both claims-based and clinical data-based measures;
  • improve patients’ experience of care across all dimensions in a standard survey;
  • improve self-reported functional scores (SF-12) and improveproductivityin the workplace, and
  • create an excellent work environment for physicians and staff.

What was Boeing’s strategy?

• Boeing aimed to introduce a new care delivery model, and to use a payment reform strategy to support the new care model.
• The care model’s characteristics are as follows:
  • The Intensive Outpatient Care program (IOCP) focuses on transforming care for individuals with complex andchronic conditionsrepresenting the highest levels of risk in the population – those representing the highest 10-20% of projected future cost. The care processes and principles align directionally with themedical homeconcept, while specifically leveraging and advancing strong focus on those patients who have the most complex needs.
  • The central provider is a nurse care manager who is dedicated full time to the role and manages a panel of 150-200 of high risk patients. The nurse care manager and a partnering physician(s) facilitate a lengthy intake visit with the patient, with two contacts (“touches”) per month minimum thereafter in continuing care.
  • Sites implement shared care plans, increased access, and proactively managed care.There is special focus on behavioral health as a recognized need for the population, as more than half of the population was identified with mental health needs.
  • High-risk patients are identified with the help ofpredictive modelingsoftware, in this case employed by the company’s health plan, Regence Blue Shield.
• The payment model’s characteristics during the pilot were as follows:
  • Sites were paid a per-member-per-month (PMPM) case rate to cover non-traditional services that were expected to be delivered by the primary care teams. This was accomplished through an addendum to Boeing’s health plan contract.
  • A second expanded pilot administered by Regence Blue Shield beginning in 2010 combines PMPMsupplemental paymentswith aShared Savingsarrangement that will distribute any savings based on clinical quality and financial results. TheShared Savingswill be calculated once per year for two program years and will compare the program group against a control group.
• Boeing played a hands-on role in the initial two-year pilot, actively responsible for the day-to-day management of the pilot, with the help of two contractors who conceived of the design (Mercer Health and Benefitsand Renaissance Health). This involvement included meeting with providers, training nurses around enrollment and shared care plans, weekly nurse calls to share experiences and best practices, quarterly advisory board meetings with each clinic, all positioning the clinic pilot as sponsored by Boeing.

What challenges did Boeing face with the strategy?

• Recruiting patients to participate was a challenge, especially because it required some people to change their existing primary care relationships. Recruitment was most effective when a primary care physician called a patient and encouraged him or her to join. Not all physicians were willing to do so.
• It’s a time-intensive program for anyone to undertake, and it may be preferable to work through a collaborative effort between employers, health plans, providers, and hospitals, rather than for an employer to do it alone. Such an effort is underway in Oregon via the Oregon Healthcare Leadership Council.
• Timely notification of emergency department utilization and hospitalizations is essential for managing care transitions and reducing readmissions, but it is also challenging. Hospitals often do not notify primary care practices of patient admissions and discharges.
• The integration of Boeing carve-out offerings (e.g., mental health,disease management) was resource intensive.

What results have been achieved?

• An assessment of the Boeing pilot found that relative to a control group of Boeing enrollees receiving care from other sites, unit-price standardized per capita spending dropped 20%, primarily due to lower inpatient and emergency department utilization. These reductions more than offset increases in physician office visits, pharmacy, and laboratory services costs.
• Patient-reported missed worked days dropped by over 56% compared to baseline, patient self-reported function improved by approximately 15%, and access to care “as soon as needed” improved 18%.

What advice does Boeing have for other employers?

• Purchasers need to be flexible with medical groups, but firm regarding roles and expectations for pilot participation.
• Medical groups must be “believers” from the top down. Make sure that there is strong leadership commitment.
• The success of the model is rooted in the nurse care managers (“It’s all about the nurses”), so make certain that special consideration is given to the design and implementation of this function.
• Pay attention to behavioral health and to behavioral healthBenefits. Boeing did not anticipate the magnitude of behavioral health issues.
• Purchaser oversight of pilot operations is critical.