Patient Focused Funding in BC

A Revolution or Just a System Tweak?

Les Vertesi

BCPSQ Forum

March 9, 2012

Why Change at All?

• Are you satisfied with the current state of health care in which you work?

– Waitlists (20% > a year)

– Crowding & Delays in Emergency Departments?

– ALC rates near 20% of In-hospital Days

– “Quality” is an uphill struggle

– And one more small thing …

2

Ignore This at Your Peril

3

Changing the Game

• A Conversation with Government (2006)

• If you could fix One Thing in Healthcare …?

– Will You Pay for it?

– No? Why not?

• What if it were fixed and the bill was …. ?

• What if you only had to pay if it was fixed?

4

A New Game in Town

• Governments are less willing to put money in when they don’t think they are getting Quality

– Would YOU be willing to keep paying for something you are not getting?

– Who is best placed to manage the RISK of success or failure?

• Can government be a “purchaser” and let the Health Authorities be (competitive) providers?

5

Where to Start?

• Fall of 2006:

– ED Congestion chosen as Top Priority by Senior Executive of Cabinet

– Unwilling to continue putting out money on faith

– But Willing to Pay if it was “Solved”• i.e. for Success Only

• RESULT:

– $16.5M to a P4P formula at 4 Vancouver Hospital Emergency Departments

6

EDP4P Basics

• All Money earned goes to the Hospital– Believe that best decisions are ones made locally

– Sense of “provider ownership” created by control of money

– But nobody keeps any money

• EDP4P is not an improvement strategy in itself– Money must be invested in improvement (QI) processes

– Relatively easy improvements can generate confidence & cash to fund more difficult changes

• Hospitals are free to invest as they see fit, but must report how money has been used

7

What P4P is NOT

• It is NOT a way to make People work Faster– It is a Way of making them Pay Attention and re-think

their approach to the Patient Experience

• Money is NOT the Incentive – Improvement is the real incentive

• If Money is “not a reward”, then why is it tied to Performance?• Because it is a Shared RISK strategy

8

Did It Work?

1,000

1,200

1,400

1,600

1,800

2,000

2,200

3,000

3,200

3,400

3,600

3,800

4,000

4,200

4,400

No

. o

f A

dm

its M

eeti

ng

Targ

ets

No

. o

f C

TA

S P

ts M

eeti

ng

Targ

ets

First Year of EDP4P

Numbers of Pts Meeting TargetsAll VCH Hospitals

# Non-adm CTAS 1-2-3

# Admitted

9

Did It Really Work?

40%

45%

50%

55%

60%

65%

70%

First Year of EDP4P

Percentages Meeting Transition Time Targets(All VCH Hospitals)

Pct of CTAS 1-2-3

Pct of Admissions

10

Later Things Became More Difficult

40%

45%

50%

55%

60%

65%

70%

First 30 Months of EDP4P

Percentages Meeting Transition Time Targets(All VCH Hospitals)

Pct of CTAS 1-2-3

Pct of Admissions

11

One of the Reasons Why

0.90

0.95

1.00

1.05

1.10

1.15

1.20

Pct

Ch

an

ge f

rom

Base

First 30 Months of EDP4P

Pct Change in Volumes of Visits & AdmissionsAll VCHA Hospitals

% Change in Visit Volume

% Change in Admissions

12

13

EDP4P Experience at Lion’s Gate

150

200

250

300

350

400

450

500

550

600

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Fiscal Period

Number and Percentage of Admitted Patients Waiting in Emergency Department for < 10 hours

(Lion Gate Hospital, April 2007 - March 2010)

% of Patients

# Patients

BEFORE PFF

ACCESS to Care at LGH Did Improve

• Reduced length of stay (by 20%)• ALC dropped from 11% to 4%• Reduced occupancy levels (to 96%)• Shortened wait times in ED (38% to 65% within target)

BUT …• More patients arrived to ED & required admission• More transfers from other hospitals since beds now available• Lower cost ALC days were reduced• Average Cost per patient day increased

The budget went from breakeven to $4M deficit!

14

The Fixed Budget PUNISHED Quality

Why?

Because Patient Care Costs Money … and Money Comes in Boxes

Things Work Best When the Money & the Patients are in the Same Place

15

The Message about Quality

• For Quality to be Sustainable, Patients & Money have to be Matched

• It is Hard to Move Patients, but Easy to Move Money

• Activity Based Funding is NOT necessarily a stimulus

• It is a way of Making Sure Money can move to Support Care Where it is Most Needed

16

So What are We Actually Doing in BC?Patient Focused Funding is an Umbrella Term

Activity Based

Funding

ProceduralCare

(Bulk Purchasing)

CommunityInitiatives

Pay forPerformance

QualityImprovement

Common Theme: Funding Follows Patients not the Facilities

17

Supporting a Continuum of Care

Home/CommunityHome Support decreases need for Residential Care

ED P4PImproved Emergency Department Access & Flow

ALC decrease

ED AdmissionsABF supports ED Admit Transfers to Wards

ABF lowers LOS & enables shift to Day Procedures Inpatient Flow

ABF funding eases discharge & lowers ALC population

18

19

Mythbuster

Myth:

Activity Based Funding drives increased volume

Truth:

ABF provides incentive to care for the sickest patients in acute care, and others in same day or community care

It is up to US!

Slide Courtesy of Duncan CampbellChief Financial Officer

Vancouver Coastal Health Authority

From Theory to Reality

The Vancouver Coastal Health Experience with Patient Focused Funding

20

Vancouver Coastal HealthPatient Focused Funding

What Have We Achieved and Where

Will It Take Us

Quality Forum

Darcia Pope, Executive Director, Transformation

March 9, 2012

22

Vancouver Coastal Health Strategic Framework

Lens People First

Vision We will be leaders in promoting wellness and ensuring care by focusing on quality and innovation.

Mission We are committed to supporting healthy lives in healthy communities with our partners through care, education and research.

Values Service Integrity Sustainability

Drivers Patient/Community Focus Engaged Team Operational Excellence Financial Sustainability

Go

als

Ob

jecti

ves

Provide the best

quality of care.

Promote better

health for our

communities.

Optimize our

workforce and

prepare for the

future.

Use our resources efficiently to sustain a viable

health care system.

Use a

standardized, ri

gorous process to

accelerate the

creation and broad

use of evidenced-

based protocols in

all clinical areas

and programs.

Develop a

regional

program for Mental

Health and

Addiction and

Cardiac Sciences to

improve quality of

care.

Build a regional

medication

reconciliation

system across the

continuum.

Reduce health

inequities in the

populations we

serve through

focused

improvements in

core public health

programs.

Build on VCH

integration

strategies to support

implementation of

the MoHS directive

to deliver integrated

primary care, home

and community care

and community

mental health

services.

Enhance

workforce

utilization and match

staffing to clinical

volumes and patient

acuity.

Recruit and

retain the best

people by fostering

a culture of

excellence, recogniti

on and respect.

Build

organizational

capacity by

strengthening

leadership and

management

competencies.

Embed LEAN

thinking at all

levels to fulfill

objectives and to

deliver quality

outcomes.

Develop and

implement best

practices in care

management to reduce

unnecessary days of

stay.

Deliver

administrative and

support efficiencies

through the shared

services organization

and consolidation.

Respond to provincial

patient-centered

funding model.

Develop service

agreements with

funders and service

providers.

Develop and

implement a strategy to

secure increased

capital funding.

Continue our

commitment to “Green

Care” alternatives by

reducing waste and our

carbon footprint.

Respond to

provincial patient-

centered funding

model.

Develop service

agreements with

funders and service

providers.

Develop and

implement a

strategy to secure

increased capital

funding.

Continue our

commitment to

“Green Care”

alternatives by reducing

waste and our carbon

footprint.

1.1

1.2

1.3

2.1

2.2

3.1

3.2

4.1

4.2

4.3

4.4

4.5

4.6

4.7

3.3

Drivers Engaged TeamPatient/Community Focus

Optimize our

workforce and

prepare for the

future.

Provide the best

quality of care.

Promote better

health for our

communities.

Use our resources efficiently to sustain a viable

health care system.

Operational Excellence Financial Sustainability

23

A Systems View

• Treat people in the most appropriate care location

• Deliver the highest quality of care

• Ensure effective use of resources

• Emphasize scalability of services

Home Care

Home ED Home

Residential

Acute

Community

24

Examples of Pay for Performance at VCH

1. P4P in the Emergency Department

2. Activity Based Funding in Acute Care

3. Procedural Care

4. National Surgical Quality Improvement Program

(NSQIP) Implementation

5. Community Initiatives

25

Treat People Effectively in the ED

Treat people effectively in the ED (ED P4P)

• Improve access to care, including reducing wait times

• Improve quality of care

• Increase efficiencies

• Maintain existing new initiatives and reward further improvement

Home Care

Home ED Home

Residential

Acute

Community

26

VCH - Success with ED P4P

Three separate streams of patients with independent

targets to reduce wait times and improve access:

1. Admitted Patients (to an inpatient bed within 10 hours)

2. Not admitted patients, High Priority (discharged within 4

hours)

3. Not admitted patients, Low Priority (discharged within 2 hours)

Additional 36,000 patients treated within target wait time in 2010/12

27

ED Admits Volumes vs Admit EDLOS

In P5 admitted 1480 patients with an average EDLOS of 9.2 hours.

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-05

Avg

ED

LOS

(Ad

mit

ted

Pat

ien

ts)

# E

D A

dm

issi

on

s

Fiscal Period

VGH ED Admits Volumes vs Admit EDLOS(Fiscal Yr 04/05 to 11/12 YTD)

ED Admits Volumes Admit EDLOS (avg hrs)

28

Optimize Acute Care Services

Optimize Acute Care Services

• Activity Based Funding – RIW based funding provides

incentive to care for the sickest patients and shift inpatient

surgery to daycare

• Procedural Care Program – Reduce wait times

• NSQIP Implementation – improve the quality of surgical care

Home Care

Home ED Home

Residential

Acute

Community

28

29

Activity vs. Gobal Funding

for Acute Care

• The shift from global funding to activity based funding has

helped VCH to achieve desired performance, behaviour

change and transformation of systems across

acute, community and primary care service

• Goal:

To move acute care to outpatient services

To decrease length of stay

30

Activity Based Funding at VCH

• The ABF model for inpatient and same day procedures

provides a tool for VCH to focus on service level changes and

reallocate resources accordingly

• The marginal funding rate fosters the requirement for efficiency

and cost management

• VCH continues to work with physicians and Health Records to

improve quality and timeliness to ensure funding reflects acuity

levels accurately

• The ED P4P earnings + RIW earnings equals the cost of

opening extra beds

31

Procedural Care Program

• The Procedural Care Program was established

to reduce the wait times for patients waiting the

longest for care:

• “Top 10” Day Surgeries

• VCH Selected Procedures with High Wait Times

• Surgical and Medical Procedures Mainly Performed in

Procedure Rooms

• Magnetic Resonance Imaging (MRI) Exams

32

15

20

25

30

35

40

452

01

0-0

8

20

10

-09

20

10

-10

20

10

-11

20

10

-12

20

11

-01

20

11

-02

20

11

-03

Month End

Top 10 Day Surgery - Average Wait Time (Weeks) for Cases Waiting

Contracted Cases at Contracted Facilities

IHA

FHA

VCHA

VIHA

BC

33

33

MRI Wait Times

0

2

4

6

8

10

12

14

16

0

500

1,000

1,500

2,000

2,500

3,000

09

P1

09

P4

09

P7

09

P1

0

09

P1

3

10

P3

10

P6

10

P9

10

P1

2

11

P2

11

P5

11

P8

11

P1

1

12

P1

12

P4

12

P7

12

P1

0

Ave

rage

Wai

t Ti

me

(M

on

ths)

MR

I V

olu

me

Year Fiscal Period

VCH MRI Volumes and Average Wait Time

Total MRI

Average Wait Time

LMIIF6,456 Exams

HSPOAnnualized total

6,304 Exams

33

34

NSQIP Program

• Thesis: improve overall surgical outcomes by joining the

American College of Surgeons’ National Surgical Quality

Improvement Project

• In October of 2002, the U.S. Institute of Medicine named

NSQIP the “best in the nation” for measuring and

reporting surgical quality and outcomes

• Data can be used to help:

– increase patient satisfaction

– reduce the median length of stay

– reduce postoperative mortality rates

35

Overall* 30-Day Morbidity

* Includes General and Vascular Surgery Cases

Observed rate: 17.69%

Expected Rate: 10.46%

O/E Ratio: 1.69

Status: Needs Improvement

Before – Surrey Memorial Hospital

36

Overall* 30-Day Morbidity

* Includes General and Vascular Surgery Cases

Observed Rate:

11.88%

Expected Rate:

10.88%

O/E Ratio: 1.09

Status: As Expected

2010 Report

After – Surrey Memorial Hospital

37

Invest in Community, Home Support and

Primary Care

Home Care

Invest in Community and Home Support

• Reduce ED visits

• Reduce length of stay

• Reduce ALC

• Reduce Acute and Residential Care Admissions

• Reduce Readmissions

Home Home

Residential

Acute

Community

ED

38

Avoidance of Unnecessary Residential

Care and Acute Admissions (AURAA)

• A comprehensive set of community-based services

designed to provide proactive care to prevent

exacerbation of known complex disease

• Will prevent avoidable ED, Acute and Residential Care

admissions and reduce LOS amongst the population at

highest risk, while improving overall health status at

home

• Targets:

– Decrease RC use by 6 months per client

– Reduction in ALC days by 30% per client continued…

39

Avoidance of Unnecessary Residential Care

and Acute Admissions (AURAA)• 118 patients enrolled across 6 communities in VCH

– All 118 patients were waitlisted or eligible for residential care

– Over 90% of these patients are still in the community and have

not had to be admitted to residential care

• Patients waiting @ home have– declined RC bed when available

– Shown marked functional and mental improvement

• Collaboration between acute and community has

evolved

– Partnering in care planning across patient journey

– Issue tracking promotes continuous learning

• Culture shift in clients expectations for RC placements

40

0

200

400

600

800

1000

1200

1400

08/09 09/10 10/11 11/12

# of RC Registrations (Total) by Fiscal Year (P11 YTD)

Vancouver

# of RC Registrations (P11 YTD) Average 08/09 to 10/11 (P11 YTD)

41

PFF can Lead to Better, Earlier

Discharges: AURAA

41

VCH-Richmond

Average # of ALC Clients

4039

38 38

35

27

1918

21

23

27

2524

25

20 20 20 20 20 20 20 20 20 20 20 20 20 20

0

5

10

15

20

25

30

35

40

45

11-11 11-12 11-13 12-01 12-02 12-03 12-04 12-05 12-06 12-07 12-08 12-09 12-10 12-11

Period

Clien

ts

Clients Target

Source: VCH Decision Support Prepared by: Ana Himani, Business Analyst

P2: Start of

Home First Initiative

42

Total Residential Care Placements by Period

11

14

16

10

15

13

8

18 18

11

14

25

15

10

13

10

11

4

7

10

12

11

12

22

6

1

0 0 0

2

0

2

1 1 1

0 0

4

5

7

1 1

3 3 3 3

5

6

2 2

4

2 2

0

2

1 1

2

5

2

1

2 2

0 0 0

1

2

0

2

1 1

0

5

10

15

20

25

30

11-01 11-02 11-03 11-04 11-05 11-06 11-07 11-08 11-09 11-10 11-11 11-12 11-13 12-01 12-02 12-03 12-04 12-05 12-06 12-07 12-08 12-09 12-10 12-11

Period

# o

f P

lacem

en

ts

Acute to Facility Community Community Emergency

Source : Priority Access Prepared by Ana Himani, Business Analyst

43

You can lead a horse to water but can

you make it drink? 43

44

Embracing PFF at VCH to Provide Better

Patient Care

Educate and Inform

Managers on Funding Model

Education

Provide real time information

for decision making and

analysis of scenarios

Real Time Information

Provide day to day business

and financial support to

clinical operations

Business Support

Ensure revenue flows to the

clinical area where service is

delivered

Revenue

Educate Front-Line Managers and Directors

Baseline

Vo

lum

e

Baseline

Baseline workload expressed

in both case volume and RIW

No gain in ABF revenue until

workload is above baseline

Loss in revenue if workload

is below baseline

Activity Based Funding (ABF)

Funding mechanism for

acute and same day care

cases with some exceptions

Funding unit is Resource

Intensity Weight (RIW)

Case

Case

Daycare

$3,800 / RIW

Max RIW is 10% above

baseline

Inpatient

$1,520 / RIW

Max RIW is 3% above

baseline

Case

Case

ABF

Volume

(RIW)

45

46

Utilizing Emendo Cap Plan to Forecast

Patient Volume and ABF Revenue

How VCH is utilizing the tool:

• Includes 3 years of history and current activity to forecast demand and trends

• Shift from producing a manual retrospective report to look at ABF revenue to

forecasting ABF revenue and analyzing “what if” scenarios

• Determine impact on capacity and strive to exceed projected discharge targets to

create capacity

• Develop a plan and budget and project revenue stream

• Establish baseline, input RIWs and see how volumes have increased or decreased

Objectives of Cap Plan Forecasting Tool at VCH:

• Optimize the match between staffing and clinical volumes

• Optimize productive hours per patient day and reduce overtime by planning for

fluctuations in demand

• Exceed Discharge targets to create capacity for incoming volumes

• Predict ABF Revenue

47

Provide Strategic Direction, Information

and Business Support

Clinical

Operations

Infrastructure and Business Support to Enable Clinical Operations

Transformation TeamStrategy, Project Management, Project Coordination, Education,

Communication

Decision Support Reporting Tools and Evaluation

Financial PlanningBusiness and analytical support, reporting on progress to targets, expenses,

revenues and volumes

48

In Conclusion – Key Factors for Success

1. Don’t chase money – funding needs to enable behaviour change to

support the right clinical actions

2. Not one time money- at VCH approach here to stay and grow

3. Accountability is key

4. Pay acute operations based on RIW funding – earnings drives

understanding

5. Need to resource real -time information and analytics

6. Revenue and cash flow received must flow to operations monthly

7. Coding accuracy and timing is key – need to compute RIW internally

8. Must incentivize patient flow across the continuum of care – cannot

concentrate on a single area in a bigger system.

9. Part of the strategic direction

49

Questions?

50

Appendices

51

Patient Focused Funding

Period 7 YTD Earnings Summary for VCH

($ million)

Procedural Care

Program

Community

Programs²

ED P4P funded by

HSPO (New Floor)

ABF

Payable

Total HSPO

Funding

Vancouver 0.717 0.354 2.560 $ 2.13 $ 5.761

PHC 1.305 1.625 $ (0.67) $ 2.260

Coastal 1.352 0.114 0.912 $ 1.01 $ 3.388

Richmond 0.750 0.084 0.728 $ 1.63 $ 3.192

MRI (P6 YTD) 1.221 $ 1.221

Regional 0.005 $ 0.005

NSQIP¹ 0.996 $ 0.996

Less: MoH expected

growth (unallocated) $ (0.82) $ (0.82)

Total VCH $ 6.341 $ 0.557 $ 5.825 $ 3.28 $ 16.003

Annual contract $ 14.630 $ 11.560

¹NSQIP - National Surgical Quality Improvement Program

²Community Programs (incl. start up funds)

52

VCH – Period 7 YTD

ABF $ Change from 2011/12 BaselineABF Facilities (Included Procedures)

52

($ million)

2011/12

Change

from 11/12

baseline 2011/12

Change

from 11/12

baseline 2011/12

Change

from 11/12

baseline

2011/12

Annual

Notional

ABF

Allocation

ABF

Payable

VGH/UBC 10.33$ (0.13)$ 45.31$ 2.26$ 55.64$ 2.13$ -$ 2.13$

PHC 8.40$ 0.36$ 26.59$ (1.03)$ 34.99$ (0.67)$ -$ (0.67)$

LGH 4.36$ 0.07$ 13.67$ 0.92$ 18.04$ 0.98$ -$ 0.98$

Squamish 0.56$ 0.03$ n/a n/a 0.56$ 0.03$ -$ 0.03$

RH 2.58$ 0.29$ 10.10$ 1.35$ 12.68$ 1.63$ -$ 1.63$

(0.18)$ (0.65)$ -$ (0.82)$ (0.82)$

Grand Total 26.23$ 0.44$ 95.67$ 2.85$ 121.91$ 3.29$ 10.10$ 3.29$

Notes:

- Procedural Care Program RIWs excluded

- Unused funds in one HA can be earned by another HA subject to HSPO approval and up to the total

maximum earnings available for all HAs.

Same Day ABF $ Inpatient ABF $ Total ABF $

Less: MOH expected

growth (unallocated)

53

VCH PFF Community Projects

• Avoidance of Unnecessary Residential Care and Acute

Admissions (AURAA)

• Early Supported Discharge – Chronic Disease

• ED Adverse Drug Events Screening

• Home Based Treatment for Mental Health and Addiction

• Supporting Transition of Seniors from Emergency