Sustainable Affordability Kaiser Permanente

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Sustainable AffordabilityKaiser Permanente A
Private Health Care Solution for Millions of
Americans

• Bernard J. Tyson
• Senior Vice President
• Kaiser Foundation Health Plan, Inc.
• Kaiser Foundation Hospitals
• Oakland, California U.S.A.

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U.S. Health Care Spending
2003 1.7 Trillion 2013 Projected
3.4 Trillion
( Billions)
Projected
Source Center for Medicare Medicaid
ServicesOther Research and Construction
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Chronic Illness Drives Medical Care Costs

People
Those with multiple chronic conditions
33
6
31
Those with one chronic condition
21
36
Those with no chronic conditions
72
Costs associated with each segment
Segments within the total population
Source Kaiser Permanente Northern California
commercial membership, DxCG methodology, 2001.
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Cost Distribution of Care
100
of Health Care Costs
80
60
40
Premium level
20
10 total cost
?
of People
0 total cost
0
0
20
60
80
100
40
20 of people
70 of people
Source Milliman USA Health Cost Guidelines
2001 Claim Probability Distribution
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Typical U.S. Health Plan Spending
20 people account for 0 of total health care
costs
70 people account for 10of total costs
10 people account for 90 of total costs
Source Milliman USA Health Cost Guidelines
2001 Claim Probability Distribution
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The Health Care Dilemma Managing Costs vs.
Managing Care

• Managing Costs
• Product Strategies
• Shifting Costs

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Are the Two Mutually Exclusive?

• Managing Care
• Disease Management
• Preventive Care
• Coordinated Care

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Kaiser Permanentes Strategy for Sustainable
Affordability
Managing Care
Managing Cost
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Kaiser Permanente Americas Largest Non-Profit
Health Care Program

• Integrated health care delivery
  system
• Serve 8.5 million members in nine states and D.C.
• 30 billion annual revenues

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Kaiser Permanentes Mission
To provide high quality, affordable health care
services and to improve the health of our members
and the communities we serve.
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Kaiser Permanente Partnership
A Prepaid Integrated Delivery System With
Aligned Incentives
Permanente Medical Group
Health Plan Members
Kaiser Foundation Hospitals
Kaiser Foundation Health Plan
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2004 National Quality and Service Recognition
KPs Care Management Institute was honored for
"Best Overall Disease Management Program for a
Managed Care Organization."
KP Northwest was rated 1 in the United States.
KPNW was tied for the top rating with Capital
District Physicians Health Plan in New York.
Hospitals for a Healthy Environment 2003-04
2004 -6 Environmental Awards for comprehensive
waste minimization and pollution prevention. -3
awards for virtual elimination of mercury -1
award for self-identification of environmental
goal. 2003 20 Environmental Awards for 18 KP
California facilities
The Centers for Medicare and Medicaid
Services (CMS) 2003
KP Northwest Top 10 Medicare Choice
plans Award based on disenrollment rates, HEDIS,
CAHPS, HOS results, and biennial audit results
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2003-04 State Business Groups Health Plan
Report Cards
Colorado Business Group on Health 2003 Clinical
Care Top scores (above NCQA benchmarks) on 8 of
15 measures for KP Colorado. No other Colorado
health care plan achieved this level.
2003 1 for Quality measures Kaiser
Permanente received more top 10 percent ratings
than all other health plans in California
combined.
Maryland Health Care Commission 2003 Quality KP
Mid-Atlantic States rated a Star Performer in
10 of 23 measures. No other plan achieved this
level. Service KP Mid-Atlantic States rated a
Star Performer on customer service and few
customer complaints.

• California Office of Patient Advocate 2003
• HMO Quality
• KP Northern California
• Excellent rating for Care for Getting Better
• Medical Group Quality
• The Permanente Medical Group
• Southern California Permanente Medical Group
• Good rating for Communication with Patients

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Third-Party Endorsements
New York Times October 31, 2004 Is Kaiser the
Future of American Health Care?
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Third-Party Endorsements

• The Economist
• July 15, 2004
• Without question Kaiser has
• achieved a greater degree of integration than the
  NHSintegration between prevention and cure,
• out-patient and in-patient services and between
  primary-care physicians and hospitals.
• Richard Feachem
• Executive Director
• Global Fund to Fight AIDS

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10 Clinical Priority Areas
KP Members Clinical Area with this
Condition Self Care 8.4MM Chronic
Pain 1,000,000 Elder Care 917,000 Diabetes 577,
000 Depres sion
411,000 Coronary Artery Disease 256,000 Ast
hma 141,000 Heart Failure 94,000 Cancer 25,0
00 new cases/yr Obesity 25 of adults
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Population Management More than Care Case
Management
Redesigning Processes
Targeting Population(s)
Measurement of Outcomes Feedback
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Professional Satisfaction Primary Care
Physicians of KP Are Better Supported in
Delivering Quality Care and Service
Percent of Physicians Reporting Factors as
Affecting Incentive Compensation
Percent of Physicians Reporting That Pressure
Compromises Care
Source Grumbach, et. al., California Physicians
2002 Practice and Perception
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KP HealthConnect? 4 Billion Investment to Bring
21st Century Technology to Health Care

• Essential Tools to Improve Safety, Quality,
  Service and Efficiency

Efficiency and Productivity
PCPs
Specialists
Nurses
KP Health- Connect
Pharmacy
Safety and Quality
Lab/X-ray
Billing and Coding
Service and Satisfaction
Data Management
Advice Line
Health Encyclopedia
Evidence Based Care
Scheduling Systems
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EMR A Necessity for the Future
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EMR A Necessity for the Future

• The Americans also got the lowest marks for
  medical records being unavailable at the time of
  the patient's appointment
• Release of International Survey Findings
• Commonwealth Fund, Health Policy Symposium
• Washington, D.C., Nov. 3, 2005

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• Feds Relax Rules on Use of E-Records October 6,
  2005
• President George W. Bush has made expanding the
  use of electronic medical records one of the top
  healthcare priorities for his administration. The
  systems are widely thought to have the potential
  to cut healthcare costs and reduce the estimated
  44,000 to 98,000 deaths caused by medical errors
  each year in the United States.

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HealthConnect Application
Benefit
Degree of comprehensive data and integration
Quality measurement, improvement research
Integrated EMR Inpatient, Outpatient, Lab,
Pharmacy.
Improved diagnosis disease management
Clinical Decision Support
Remote Access
Increased physician timeliness efficiency
Medication Order Entry
Reduce prescribing errors
Internet AccessEmail Communications, Online
Health Information, etc.
Improved patient access and convenience
Automated Reminders(Preventative Monitoring
Tasks)
Improve compliance with practice guidelines
Charting/Documentation
Improve effectiveness throughaccess to patient
history
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Kaiser Permanentes Mission
To provide high quality, affordable health care
services and to improve the health of our members
and the communities we serve.
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Questions, Comments Answers