Creating a high-performing health care system

better care • improved outcomes • increased value

2014 Partners in Health Care Report

Blue Cross Blue Shield of Michigan works closely with physicians,

other health care professionals and hospitals across the state to

develop clinically oriented programs to improve patient care —

programs that are demonstrating strong, measurable results. We

call these programs Value Partnerships — and they’re changing

the health care landscape in Michigan.

This report tells the story of how health care professionals are

collaborating with the Blues to improve health care quality and

the health care experience for Michigan residents …

“Blue Cross Blue Shield of Michigan’s Value Partnerships program has transformed health care delivery,

saved hundreds of millions of dollars and improved lives. Value Partnerships initiatives such as our nationally

recognized Patient-Centered Medical Home program wouldn’t have been possible without the collaborative

efforts of the Blues, Michigan physicians, physician organizations and hospitals across the state.”

Daniel J. LoeppPresident and CEO, Blue Cross Blue Shield of Michigan

A message from Dr. David Share, BCBSM’s senior vice president, Value Partnerships

As we approach the 10th anniversary of Value Partnerships, it’s gratifying to know that — in partnership with the physician and hospital community — we’re continuing to make dramatic improvements in health care outcomes for patients. We’ve launched new statewide quality initiatives and reported impressive health care savings both for Blue Cross and the state as a whole.

Over the past year, we’ve accelerated our efforts to move from a pay-for-service to a pay-for-value model with health care professionals, and have entered into value-based contracts with hospitals across Michigan. As of June 2014, nine hospital systems comprising 55 hospitals are participating in our value-based reimbursement model.

With a pay-for-value model, a portion of a hospital’s pay is based on the health outcomes of an entire population of patients — not simply on the number of services performed. The hospitals that have signed value-based contracts work closely with physician organizations participating in PGIP to implement new information systems and care processes to better coordinate each patient’s health care.

We’re excited about the results that our Value Partnerships programs are delivering. For example, a recent study showed that our Physician Group Incentive Program reduced health care costs at the population level by 1.5 percent in 2011. Another published study demonstrated that our Patient-Centered Medical Home program has resulted in substantial quality improvement and cost reductions for the patients served.

You’ll find more information on the results of our collaborative efforts with physicians and hospitals in this report and at valuepartnerships.com.

Table of contentsCollaborative Quality Initiatives .......................................2

Hospital-based CQIs ..............................................................2

Professional CQIs ...................................................................8

Hospital Pay-for-Performance Program and value-based reimbursement .................................. 11

Physician Group Incentive Program .............................. 12

Patient-Centered Medical Home Program ................... 14

Provider-Delivered Care Management ......................... 16

Organized Systems of Care ........................................... 17

Blue Distinction® Specialty Care Program ..................... 18

Collaborative Quality InitiativesCollaborative Quality Initiatives are provider-led, data registry-driven, quality improvement programs that play an important role in BCBSM’s health care transformation journey.

BCBSM Cardiovascular Consortium — Percutaneous Coronary Intervention

BCBSM Cardiovascular Consortium — Vascular Interventions Collaborative

Hospital Medicine Safety

Michigan Anticoagulation Quality Improvement Initiative

Michigan Arthroplasty Registry for Collaborative Quality Improvement

Michigan Bariatric Surgery Collaborative

Michigan Breast Oncology Quality Initiative

Michigan Radiation Oncology Quality Consortium

Michigan Society of Thoracic and Cardiovascular Surgeons Quality Collaborative

Michigan Surgical Quality Collaborative

Michigan Trauma Quality Improvement Program

Perioperative Outcomes Initiative

NEW! Michigan Spine Surgery Improvement Collaborative

NEW! Michigan Value Collaborative

Hospital-based CQIsHere’s a look at the current roster of Blue Cross’ statewide hospital-based CQIs and some of our newest results.

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“BMC2 [BCBSM

Cardiovascular

Consortium] has

forged a unique and

vital partnership

with hospitals and

interventional

cardiologists

across Michigan to

continually optimize

practices, systems and

outcomes of care.

The Michigan chapter

of the American

College of Cardiology

is proud to be a

collaborator with BMC2

in this ever-evolving

culture of quality in

Michigan.”

Claire Duvernoy, M.D.President, Michigan chapter of the ACC

Chief of cardiology, VA Ann Arbor Healthcare System

Associate professor of medicine, University of Michigan Health System

33%

BCBSM Cardiovascular Consortium

reduction in blood transfusions

reduction in vascular complications

45%52% 42%

Percutaneous Coronary Intervention (2008 through second-quarter 2013)Designed to improve care for patients with coronary disease who undergo angioplasty

Vascular Interventions Collaborative (2008 through 2012)Designed to decrease complications and improve medical therapy for patients undergoing peripheral vascular interventions and open vascular surgeries

reduction in contrast-induced nephropathy

8% 20%

increase in cardiac rehabilitation referral

reduction in blood transfusions

reduction in vascular complications

reduction in contrast-induced nephropathy

30%

increase in cardiac rehabilitation referral

8%

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Hospital Medicine Safety

Focuses on improving care for patients at risk for adverse events

related to hospital-associated venous thromboembolism (blood clot)

89.3%

third-quarter 2013

eligible medical inpatients that have a VTE risk assessment documented on admission

83.3%

second-quarter 2013

68.2%

program inception 2010

“The Hospital Medicine Safety consortium has the potential to markedly improve the care of patients in the

state and to create new science that can be used outside of the participating hospitals. Knowledge gained

to date has radically changed how many members of the consortium view which hospitalized patients

should be treated to prevent blood clots. These changes have the potential to decrease how often patients

need injections of medication and to save hospitals costs without increasing risks — a win, win situation.”

Scott Kaatz, D.O., MSc, FACPChief Quality Officer and Chief of Hospital Medicine, Hurley Medical Center

Clinical Associate Professor of Medicine, Michigan State University College of Medicine

Michigan Breast Oncology Quality Initiative

Examines practice patterns in surgical, radiation and medical

oncology to improve breast cancer treatment and outcomes

59.3%participating sites average decrease in surgical biopsy rates

2006 – Third-quarter 2013

For details on these initiatives, visit valuepartnerships.com

and click on Quality collaborations.

4

Michigan Bariatric Surgery Collaborative

Works to improve the quality of care for patients undergoing

bariatric surgery

96%

decreased preoperative inferior vena cava filter placement rate

2007 to 2013

An analysis by MBSC leadership has shown that patients who receive

IVC filters have higher rates of complications following surgery.

93%

decreased rates of venous thromboembolism (blood clots that form in a vein)

2007-2012

87%

increased compliance with blood clot prevention

guidelines

2007-2013

Study examines link between technical skill and postoperative outcomesThe Michigan Bariatric Surgery Collaborative conducted a groundbreaking study in 2013 that explored the role of surgical skill in postoperative outcomes.

The results? Surgical skill is a strong predictor of clinical outcomes. The results were published in the Oct. 10, 2013 issue of The New England Journal of Medicine and subsequently highlighted in The New York Times.

As part of the study, 20 participating bariatric surgeons submitted videotapes of themselves performing a laparoscopic gastric bypass. Each videotape was rated in various domains of technical skill by at least 10 peer surgeons who were unaware of the operating surgeon’s identity.

“The technical skill of practicing bariatric surgeons varied widely, and greater skill was associated with fewer postoperative complications and lower rates of reoperation, readmission and visits to the emergency department,” said Dr. John D. Birkmeyer, the lead author of the study and director of the Center for Health Care Outcomes and Policy at the University of Michigan. He’s also the longtime co-director of the Michigan Bariatric Surgery Collaborative.

Read a blog on this study — and view the accompanying video — on valuepartnerships.com. Scroll down to Value Partnership Blog and click on Bariatric Surgery.

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Michigan Society of Thoracic and Cardiovascular Surgeons Quality Collaborative (2011 through 2012)

Aims to reduce the risk of complications and improve treatment

methods for cardiac surgery

Michigan Surgical Quality Collaborative

Aims to evaluate and improve the quality of general and vascular surgery

20.3%

reduction in surgical site infections

2008-2013

43%

reduction in venous thromboembolism

2012-2013

The Agency for Healthcare Research and Quality’s Health Care Innovations Exchange recognized BCBSM for providing financial incentives,

infrastructure and other support to stimulate health care provider engagement in statewide transformation

quality initiatives

12.1%

2012

(compared to 13.9% in 2011)

82.1%

201369.6%

2012

Did you know

75 hospitals across Michigan

participate in at least one CQI Hospital CQIs annually analyze the care given to nearly

200,000 Michigan patients

More than 50 times in the past four years,

BCBSM CQIs have been highlighted in national peer-reviewed journals

increase of cardiac surgery patients in Michigan who didn’t require blood transfusions during surgery

decreased thirty-day readmission rate for participating hospitals

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Certified savings for 5 CQIsAn actuarial analysis of five of our longest running hospital-based Collaborative Quality Initiatives showed that program savings went far beyond Blue Cross Blue Shield of Michigan to benefit all hospitalized patients throughout Michigan. The results of quality initiatives such as these support our social mission goal of creating a healthier Michigan.

This table shows one-year savings during 2012:

Statewide* Blues savings** BCBSM only

BCBSM Cardiovascular Consortium(This encompasses two CQIs:

Percutaneous Coronary Intervention and

Vascular Interventions Collaborative.)

$103,932,044 $18,044,373 $11,276,592

Michigan Surgical Quality Collaborative $55,630,558 $35,538,332 $24,795,035

Michigan Society of Thoracic and Cardiovascular Surgeons Quality

Collaborative$27,265,939 $2,966,171 $1,862,842

Michigan Bariatric Surgery Collaborative $6,876,200 $3,097,775 $2,365,573

Total $193,704,741 $59,646,651 $40,300,042

* Statewide savings include BCBSM, BCN, BCBSM-Medicare Advantage, BCN-Medicare Advantage, Blue Cross Complete, Medicare, Medicaid, uninsured, self payers and other commercial insurers

**Blues savings includes BCBSM, BCN, BCBSM-Medicare Advantage, BCN-Medicare Advantage and Blue Cross Complete.

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Professional CQIsThese initiatives involve collaboration among physicians representing one or more specialty groups across the state.

Lean for Clinical Redesign

Michigan Oncology Clinical Treatment Pathways Program

Michigan Oncology Quality Consortium

Michigan Transitions of Care Collaborative

Michigan Urological Surgery Improvement Collaborative

Michigan Oncology Quality Consortium

Encourages oncology practices to participate in the American Society of Clinical Oncology Quality Practice Initiative and improve the quality of

cancer care delivery

MOQC participants have the highest rate of referrals to the Michigan Department of

Community Health’s Tobacco Quitline

MOQC practices continue to perform well on the measure “chemotherapy

in the last two weeks of life.”

8.8%

MOQC practices

11.5%

National

This indicates that MOQC practices recognize that continuing chemotherapy

at the end of life is nonproductive.

VS

For more details on the professional CQIs, visit valuepartnerships.com.

more than

1,000referrals

9months

8

Michigan Transitions of Care Collaborative

Aims to improve planning and communication between inpatient and outpatient facilities to

prevent hospital readmissions

of patients were seen within seven days of discharge, reducing the risk of readmission within 30 days

7 participating teams

80%of discharge summaries were sent to the associated physician organizations within 72 hours of a patient being discharged from the hospital

achieved goal:

5 participating teams

achieved goal: 50%

Michigan Oncology Clinical Treatment Pathways

Provides recommended treatment

pathways, or treatment regimens, for newly

diagnosed patients with breast, colon, lung,

lymphoma, myeloma, ovarian, prostate

and renal cancers

60%

of eligible PGIP medical oncologists participate

in the program

2014

decrease of the variability in treatment

regimens within a particular cancer type

2009-2012

10%

nearly

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Blogging about MUSIC…The Michigan Urological Surgery Improvement Collaborative, one of the professional CQIs, was the subject of a blog written by Brian Stork, M.D., a urologist at West Shore Urology, with offices in Muskegon and Grand Haven.

“MUSIC has turned out to be more than just an exercise in agreeing upon metrics and collecting data. It has been an opportunity for academic and private practice urologists to ask the questions and learn from each other in an effort to continuously improve urological care,” he wrote in a blog that was posted on the Best Doctors® website, as well as on our Value Partnerships website.

Read more at valuepartnerships.com.

Michigan Urological Surgery Improvement Collaborative

Focuses on improving the quality of care for men with prostate cancer

Developed two pathways for reducing the number of serious infectious complications that result in hospital

admissions after prostate biopsies

Brought patients with prostate cancer into the collaborative, including them in workgroups and

meetings to gain their perspectives

1202012

Increased the number of oncologists participating in the collaborative

1752013

more than

10,000 patients

Collected data

since the inception of the program in January 2012

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Hospital Pay-for-Performance Program and value-based reimbursementWe’ve updated our Hospital P4P program to reflect the shift away from a pay-for-service model to a pay-for-value approach. The new program recognizes short-term acute care hospitals (both large hospitals and small rural hospitals) for improving health care quality, cost-efficiency and population health management. This includes:

• Improving the health of a population of patients

• Reducing hospital readmissions

• Providing daily census data that can help physicians better manage patient care

A key element of the shift toward pay-for-value is developing value-based contracts with hospitals.

Under the new value-based arrangement, BCBSM provides funding to help hospitals develop infrastructure to better coordinate care between the hospitals and their physician partners. The arrangement recognizes hospitals with a share of the savings realized when hospitals and physicians work together to achieve efficient and effective treatments.

9 hospital systems, comprising 55 hospitals have entered into value-based reimbursement

arrangements with BCBSM

= 57%of the total BCBSM

hospital payout

Value-based reimbursement by the numbers

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Physician Group Incentive ProgramOur Physician Group Incentive Program brings together primary care physicians and

specialists from across Michigan to share information and collaborate on initiatives

that lead to high-quality and efficient health care. PGIP participants work through

physician organizations, enabling them to leverage a PO’s size, structure and resources

to transform health care across a broad geographic area.

By the numbers The number of physicians, practice units and physician organizations participating in our Physician Group Incentive Program continues to grow.

Physician organizations

4245

Physician practice units

6,1866,544

Primary care physicians

5,8135,866

Specialist physicians

12,04213,406

All physicians17,855

19,272

Summer 2013

Summer 2014

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Clinical information technology-focused initiatives

NEW! ADT (Admissions, Discharges, Transfers) Initiative

Accelerating the Adoption and Use of Electronic Prescribing

PCMH Patient Web Portal

PCMH Patient Registry

Condition-focused initiatives

Cardiac Care I Initiative

Cardiac Care II Initiative

Women’s Care Initiative

Michigan Oncology Quality Consortium

Michigan Oncology Clinical Treatment Pathways

Michigan Urological Surgery Improvement Collaborative

Core clinical process-focused initiatives

Transitions of Care

Lean for Clinical Redesign

Evidence Based Care Tracking Initiative

PCMH Coordination of Care

PCMH Extended Access

PCMH Individual Care Management

PCMH Linkage to Community Services

PCMH Patient Provider Partnership

PCMH Performance Reporting

PCMH Preventive Services

PCMH Self-Management Support

PCMH Specialist Referral Process

PCMH Test Tracking and Followup

Service-focused initiatives

Emergency Department Utilization

Radiology Management

Organized Systems of Care initiatives

Integrated Patient Registry

Integrated Performance Measurement

Integrated Processes of Care

87% of our

commercial PPO population is cared for by

a physician engaged in PGIP

More than 68% of BCBSM’s participating

primary care physicians and

more than 51%

of specialists

participate in PGIP

Did you know

We currently offer 28 PGIP initiatives:

81 of 83 Michigan counties have

PGIP-participating physicians

Nearly 2 million commercial members recieve care by a PGIP-participating physician

13

Patient-Centered Medical Home ProgramThis year marks the sixth anniversary of Blue Cross Blue Shield of Michigan’s PCMH designation program, which continues to be the country’s largest PCMH effort of its kind. Through patient-centered medical homes, primary care physicians lead care teams that work with patients to keep them healthy, monitor their care on an ongoing basis and coordinate their care across a variety of health care settings.

The expansion of PCMH: PCMH-Neighbor

Recognizing the valuable role that specialist physicians and their care teams play in creating the ideal patient experience, the program was expanded in 2013 to incorporate the Patient-Centered Medical Home Neighbor, or PCMH-N, concept. Our PCMH-N program helps specialists and sub-specialists build the capabilities necessary to work more effectively with primary care physicians.

“This program not

only strengthens

the doctor-patient

relationship, it

strengthens our

overall system of care.

Through the Patient-

Centered Medical

Home model, doctors

and their care teams

are improving patient

outcomes, which

translates to fewer

hospital admissions

and emergency room

visits, which lead to

lower overall cost.”

David Share, M.D., M.P.HSenior Vice President,

Value Partnerships Blue Cross Blue Shield of Michigan

By the numbers

1,422 Michigan physician practices with

4,022physicians who are PCMH-designated

Approximately 2 out of 3

PGIP primary care physicians have

received PCMH designation

More than 1.1 million BCBSM members have access to a Blues’

PCMH-designated practice

78 out of 83 of Michigan counties have

PCMH-designated practices

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PCMH results

The patient-centered medical home approach has shown measurable results in terms of the cost and quality of care for Michigan patients. For example, a recent study suggests that when practices fully implement our PCMH model, they have:

• 3.5 percent higher quality of care for adults

• 5.1 percent more preventive care for adults

• 12.2 percent more preventive care for children

• $26.37 lower per member per month cost for adults

These results, published in the July 2013 issue of Health Services Research, are based on PCMH capability data for 2,432 primary care physicians that participated in PGIP from July 2009 to June 2010. Based on this study, the Michigan Blues’ Patient-Centered Medical Home program saved $155 million in prevented claims costs from July 2008 through June 2011.

These savings — achieved relatively early in the program’s history — include costs at all practices participating in the program, not just those that are PCMH-designated. As of summer 2014, estimated savings range from $5 to $13 lower per-member, per-month costs for adults.

What’s more, a 2014 analysis shows that the Michigan Blues’ PCMH practices have lower rates of patients being hospitalized and visiting the emergency room than non-designated practices, along with lower use of high-tech radiology services. See chart below.

PCMH-designated practices compared to non-designated practices

Adults (ages 18 to 64)* Children (newborn through age 17)*

Emergency department visits -9.9% -14.9%

Primary care-sensitive emergency department visits

-11.8% -21.3%

Ambulatory care-sensitive inpatient discharges

-27.5% N/A

High-tech radiology services -8.7% N/A

*Rate per 1,000 15

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Provider-Delivered Care ManagementOur Provider-Delivered Care Management program is an expansion of BlueHealthConnection®, our wellness and care management program that provides telephone support and coaching from nurse care managers. Using PCMH practices and principles, patients with chronic or complicated medical conditions can receive care management services from their doctor’s office, giving them additional support from a team they already know.

There are about 400 PCMH-designated practices eligible to offer provider-delivered care management services. These practices represent approximately 1,600 health care providers.

The final results of a two-year pilot program for primary care physician practices, which ran from April 2010 to March 2012, showed:

• 37 percent of patients with a chronic disease were identified and targeted for participation in the program.

• 49 percent of these targeted patients became actively engaged in the program.

PDCM expanded its scope to include oncology practices in 2013. A total of 22 statewide practices with 175 medical oncologists now participate in the program and can provide more comprehensive care management services to their patients with cancer. This program will expand to include additional oncology practices Dec. 1, 2014.

Overall, we’ve found that patients receiving provider-delivered care management services are better managing their chronic or complex conditions and are highly engaged in their plan of care.

“By working with

patients one-on-

one, we’re helping

to change people’s

lives, providing the

support they need

to lose weight, eat

healthier, adhere

to their medication

schedule and better

manage their chronic

conditions, such as

asthma and diabetes.

Our efforts often prevent

emergency room visits,

helping to hold down

health care costs.”

Heidi Steinhebel, R.N.Certified Case Manager,

Chronic Care Professional Lead Care Manager

IHA Ann Arbor Family Medicine

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Organized Systems of CareOrganized Systems of Care is a program designed to help primary care physicians, specialists and hospitals work together more closely to manage populations of patients. Once established, OSCs can transform health care over a broad geographic area and across care settings.

Participating OSCs have been testing integrated, system-wide care processes and data-sharing practices to determine what qualities and features an OSC should have. Blue Cross Blue Shield of Michigan provides funding to assist OSCs in building the infrastructure necessary to manage patient care.

Eventually, the practice-focused programs (such as PCMH) and the hospital-focused programs (such as value-based contracting) will connect with quality-focused programs (such as PGIP and the CQIs). Together they’ll form high-performing health care systems in which providers can better coordinate patient care across all care settings.

By the numbers

39 Organized Systems of Care

comprised of:

4,600primary care physicians

10,300specialists

1.3 million patients attributed to a

primary care physician and

cared for within an OSC

Building connections to improve population health

Patient population

(primary care physician-attributed)

PCMH PCMH-N

Hospitals and other facilities

Other caregivers and community

services

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“Value-based programs

are helping hospitals

and physicians better

align their services to

produce high-quality,

efficient care for our

members.”

Susan BarkellSenior Vice President,

Health Care Value Blue Cross Blue Shield of Michigan

Blue Distinction® Specialty Care ProgramThe Blue Cross and Blue Shield Association’s Blue Distinction Specialty Care Program is another important program focused on delivering health care quality and value. Blue Distinction Centers for Specialty Care are nationally designated hospitals that demonstrate expertise in delivering patient care safely, effectively and cost efficiently for select specialty care procedures. The program gives consumers a credible, easily identifiable means of selecting facilities that meet their individual needs.

The Blues have awarded Blue Distinction Center designations in the following areas:

• Bariatric Surgery • Knee and Hip Replacement

• Cardiac Care • Spine Surgery

• Complex and Rare Cancers • Transplants

These areas of complex, high-cost care account for more than 30 percent of inpatient costs nationally. In 2013, the program expanded to include Blue Distinction Centers+, a designation used to indicate facilities that demonstrate lower cost of care in addition to better quality. To find out which facilities have Blue Distinction Center or Blue Distinction+ designations, visit bcbs.com/bluedistinction.

Designations for Michigan hospitals

Here’s a look at the number of Michigan hospitals that have received Blue Distinction Center and Blue Distinction Center+ designation as of July 1, 2014:

Did you know

Hospitals that receive the Blue Distinction Center

designation typically have lower rates of readmissions,

surgical site infections and complications than

non-BDC facilities.

Designation BDC BDC+

Bariatric Surgery 9 N/A

Cardiac Care 2 21

Complex and Rare Cancers 3 N/A

Knee and Hip Replacement 10 27

Spine Surgery 2 23

Transplants 3 N/A18

20%

overall cost savings for Blue Distinction Centers+

Cardiac Care

45%

lower rates of major complications following cardiac procedures compared

to non-BDC facilities

43%

lower rates of in-hospital mortality following non-surgical cardiac procedures compared

to non-BDC facilities

17.9%

overall cost savings for Blue Distinction Centers+

Spine Surgery

lower readmission rates compared to non-BDC facilities

30-day 90-day

13.3%

fewer complications compared to non-BDC facilities

23.1%

90-day reoperations, lumbar and cervical

90-day reoperations, lumbar only

21.6%

14.3%

overall cost savings for Blue Distinction Centers+

Knee and Hip Replacement

lower readmission rates compared to non-BDC facilities

13.3%

30-day 90-day

11.1%

fewer complications compared to non-BDC facilities

90-day reoperations

22.5%

15.9%

Here are some examples of how the program is delivering results nationally in three critical areas.

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Partners in progressBlue Cross Blue Shield of Michigan works closely with a variety of statewide organizations to speed

health care transformation across Michigan. Here are some of our key partners:

MHA Keystone Centerfor Patient Safety & Quality

mhakeystonecenter.org*

MQICmqic.org* mipct.org* chrt.org*

valuepartnerships.com

Blue Cross Blue Shield of Michigan and Blue Care Network are nonprofit corporations and independent licensees of the Blue Cross and Blue Shield Association.

*Blue Cross Blue Shield of Michigan doesn’t control this website or endorse its general content.

MiHIN.org*

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