AllSpire Innovation Journal 2019 Self Disruption in Healthcare

SE LF -DISRUPTION IN H E A LT H C A R E D E L I V E RY N E T WO R K S ALLSPIRE HE ALTH PARTNERS I N N O VA T I O N J O U R N A L 2 019

SELF -DISRUP TION IN HEALTHCARE DELIVERY NET WORKS

A LL S PI RE H E A LT H PA RT N E RS I N N O VA T I O N J O U R N A L 2 019

Acknowledgment We would like to thank all the AllSpire Health Partners members who supported the efforts to launch the second AllSpire Innovation Journal. This journal is a celebration of the challenging, innovative work that happens at each of our hospitals every single day, as our members strive to consistently deliver the absolute best and cutting-edge care to all patients served in an uncertain and ever-changing fiscal environment. This publication would not have been possible without the contributions from our member subject matter experts, support staff and care teams that share their passion to care for their neighbors in the communities they serve.

We thank you for your thoughtful and comprehensive innovation articles that showcase each of your health systems’ continuing innovation journey.

The AllSpire Innovation Journal Team

Š 2019 AllSpire Health Partners All rights reserved.

Printed in the USA Published by AllSpire Health Partners 100 Front Street, Suite 1250 Conshocken, PA 19428 No part of this book may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, microfilming, recording, or otherwise, without the permission of the copyright holder.

Book design and layout by Gensler.

SHARING S T R E N GT H S F O R B E T T E R H E A LT H

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PRIORITY ONE: COST REDUCTION SYSTEMWIDE

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T H E WA R O N WA S T E

30 SITE NEUTRALIT Y I W O U L D N OT, C O U L D N OT, HERE OR THERE

TA B L E O F CO N T E N T S

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F O R WA R D

04 THE TYRANNY OF THE URGENT

14 A L L S P I R E H E A LT H PA R T N E R S AND THE FUTURE OF I N N OVAT I O N

THE TROUBLE WITH PRICE T R A N S PA R E N C Y WHY THERE ARE NO BLUELIGHT S P E C I A L S I N H E A LT H C A R E

PAT I E N T A F F O R DA B I L I T Y HALF A TRILLION HERE, HALF A TRILLION THERE, I T S TA R T S TO A D D U P

50 P R OV I D E R T O E M P L OY E R RETHINKING THE MIDDLEMEN

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C OX C O M M U N I C AT I O N A N D TR APOLLO C A B L E C O M PA N I E S M O V E TO O W N T H E H O M E H E A LT H ENVIRONMENT

MAKING SENSE OF THE MEDIA, MERGERS AND NON-TRADITIONAL ENTRANTS INTO HEALTHCARE

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A M A ZON, BE RKSHIRE H AT H WAY, J P M O R GA N C H A S E E M P LOY E R ' S TA K I N G C O N T R O L O F E M P LOY E E H E A LT H

64 CVS & AETNA T H E U LT I M AT E N O N - AC U T E CARE MODEL

70 G O O G L E ' S N E S T A N D V E R I LY SENSORS, SCIENCE & SE ARCH

80 GENERALI AND CARELINX T R AV E L I N S U R E R B U Y S I N TO "UBER" FOR HOMECARE

86 U N I T E D H E A LT H : O P T U M PAYO R , P R O V I D E R O R DATA C O M PA N Y ?

92 A M A Z O N ' S P I L L PA C K IS IT ABOUT THE LICENSES? OR CONTROLLING THE CHRONIC C A R E PAT I E N T R E L AT I O N S H I P ?

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ECONOMICS INNOVATION IMPERATIVES

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R A I L R OA D S R E P L A C E D BY T R U C K S , A B R I E F H I S T O RY

106 THE FIRST PERSONAL COMPUTERS

112 PROFIT DRIVERS DISAPPEARING C O S T R I S E , R E V E N U E FA L L S — CRITICAL PERFORMANCE METRICS F O R T H E C F O ' S DA S H B O A R D

126 T H E B AT T L E F O R C O N T R O L O F DRUG COSTS I D N V S R E G I O N A L V S N AT I O N A L

140 SMART LIVING T H E S M A R T- H O M E F O R H E A LT H AN D QUALIT Y OF LIFE

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TECHNOLOGY READINESS WATCH

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R E M O T E S E N S O R T E C H N O L O GY I N H E A LT H C A R E

160 EPIGENETICS N OT H I N G I S N O N - G M O

168 D I G I TA L A S S I S TA N T S

174 ROBOTIC PROCESS A U T O M AT I O N ( R PA ) MARKET ASSESSMENT & VENDOR PROFILES

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INNOVATION HIGHLIGHTS

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THE BURDEN OF SEPSIS

192 TR ANSFORMING THE MODEL OF CARE FOR PEOPLE WITH SEPSIS

232 LV H N C . A . R . E . S .

202 C OA C H N U R S I N G T E A M : R A P I D RESPONSE TEAM WITH SEPSIS FOCUS

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238 MEDICAL NEIGHBORHOOD: AN I N N OVAT I V E P R O G R A M F O R PAT I E N T S W I T H H E A R T FA I L U R E

T- M I N U S S E P S I S C A R E

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U S I N G R E M O T E PAT I E N T MONITORING TO SUPPORT P O P U L AT I O N H E A LT H OBJECTIVES

ED C.A.R.E.S. A V I R T U A L P R E S S U R E R E L I E F VA L U E

226 T E L E S P E C I A LT I E S S T R E TC H I N G R E S O U R C E S AC R O S S T H E H E A LT H S Y S T E M A N D B E YO N D

254 B A BY ' S S C R I P T S — W E L L S PA N ' S MOBILE APP SOLUTION FOR E X P E C TA N T O B J E C T I V E S

258 VERSALUS

262 VERAX E X T E N D I N G T H E L I F E O F P L AT E L E T S A N D P R OT E C T I N G PAT I E N T S

268 A P P L E ' S E H R I N I T I AT I V E WHY IS THIS TIME DIFFERENT? LV H N ' S D E C I S I O N A N D EXPERIENCE

272 A J O U R N E Y T O WA R D C O M P R E H E N S I V E I N N OVAT I V E C U LT U R E

278 MAPPING THE FUTURE FOR PAT I E N T C A R E CLINICAL RESEARCH TRIALS I M P R O V E C A N C E R T R E ATM E N T S A N D O U TC O M E S

280 A N E W C O L L A B O R AT I O N ANNOUNCED FOR CLINICAL TRIALS

282 AT L A N T I C H E A LT H S Y S T E M TR ANSFORMS CANCER CARE WITH GROUNDBREAKING PA R T N E R S H I P

308 EXECUTIVE COMMIT TEE

310 DE VE LOPME NT COMMIT TE E

311 G P O B OA R D O F M A N A G E R S

286 ALLSPIRE'S SCALE & SCOPE ALLSPIRE 'S AN NUAL AG G R E G AT I O N O F A S S E T S

288 A L L S P I R E H E A LT H C A R E PA R T N E R S

306 S R H O, T H E N AT I O N A L A S S O C I AT I O N

312 AHP + AH GPO COMMIT TEES, COUNCIL S AND WORK GROUPS

320 A L L S P I R E S TA F F

FORWARD

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

It is excruciatingly painful for a well-established and successful organization to intentionally deviate from the methods of operation that lead them to their success. Yet no business model, let alone any set of technologies, remains relevant and viable forever. People dread change, even if they know it represents progress for society and could potentially be a boon to their own personal self-interest.

Change is uncomfortable.

Healthcare in the United States evolved from an unpaid family-based caregiver system, to a visiting practitioner-based system paid in cash by patient’s families who could afford it, to a hospital-based system paid by employers, insurers and government. Today’s environment has all the signs and symptoms of imminent change, another turn of the cycle if you will, driven by technology, demographics, adverse incentives and inefficiency.

This year’s AllSpire Health Innovation Journal 2019 is entitled SelfDisruption in Healthcare Delivery Networks. It is a call to arms to prepare today’s health systems to endure, even better to embrace and thrive in, a period of profound change happening all around us.

Priority One: Cost Reduction Systemwide The cumulative effects of adverse incentives in payments for health services have resulted in decades of rising costs, well above the national growth rates in Gross Domestic Product, inflation or population. Whatever metric you choose as a benchmark, the trend is ultimately economically unsustainable. In this section we will explore what we call the War on Waste, Site Neutrality, the Trouble with Price Transparency, Patient Affordability and Direct Provider to Employer relationships.

Making Sense of the Media, Mergers, and Non-traditional Entrants into Healthcare The headlines have been awash with news of mergers and would-be new entrants into the healthcare realm. Each story has its own unique features that can be construed as threats, opportunities or non-events in the eyes of the incumbent leaders of the field. What is constant is a perception by 1

many that the current incumbents, and the U.S. healthcare system is as a whole, somewhere between inadequate and failed. Unfortunately for the incumbents, the companies eyeing healthcare as an opportunity are often orders of magnitude better resourced, less encumbered by 100 years of entrenched legacy infrastructure, somewhat less restricted by regulation and significantly more innovative.

Economic Innovation Imperatives True profound industry disruption often comes not from a technology or system breakthrough, but from an entirely new business model. This dynamic has played out countless times; we examine the collapse of the railroads in favor of trucking and the conversion of industrial scale data processing to personal computing for potential insights and analogs. Next, we take a deeper dive into the disappearing profit drivers in the current paradigm and a specific focus on drug costs. As we look into the future for potential out-of-the-box business models that would represent a gamechanging development, we explore Smart Living, or embedding healthcare both physically and financially into our housing.

Technology Readiness Watch Science and technology can radically alter the delivery of healthcare, regardless of the business model. We live in an era of such rapid advancement in so many fields that it is impossible to track even the most critical developments across healthcare in anything close to real time.

This year we have elevated a few categories as representative of the most broadly impactful over the next decade. Here we delve into the

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next generation of sensors enabling the smart home, epigenetics and the ability to turn genes on or off, digital assistants and robotic process automation. We filtered these for 100% probability, meaning it is not that these might radically transform healthcare, but rather that they will absolutely and profoundly change healthcare, we need only assess how fast and how far their impact will be felt.

AllSpire Innovation Highlights Our final section seeks to celebrate the latest innovation work and achievement within our health system membership. It provides a snapshot-in-time of the depth, scope and focus of efforts. The profiles of the members that follow provides some perspective on the scale of the collective enterprise and the resources that could be brought to bear in innovation.

The Mission of AllSpire is to harness and share the accumulated wisdom, talent and resources of our integrated health system members, via knowledge transfer and collaboration, to achieve the highest levels of Clinical Excellence, Patient Affordability, Access and Experience and Economic Sustainability, all for the benefit of the communities we serve.

We invite you to join us in this noble quest. Enjoy‌ —Paul J. Tirjan

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THE TYRANNY OF THE URGENT

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

The current decade is winding down. It is time to take stock of the 2010s and look forward into the 2020s. Prudence dictates that we step back from the immediate needs of the day-to-day business of running health systems to assess the projection of current and likely future trends. In our environment of merciless in-boxes, calendars devoid of free moments and 24/7 tweet-storms it can seem rational and productive to keep the blinders on, focus on the task at hand and serve as slave to the tyranny of urgent matters. All the more important to take time and stop, draw a breath and look around.

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Let’s start with the decade that was, 2010–2019. Today we’ll call them the “Twent-teens”.

Twent-teens: Most people in healthcare will remember the Twent-teens as the era of the Affordable Care Act, with its coverage windfall via Medicaid expansion, the elimination of discrimination against pre-existing conditions and children clinging to parent's health insurance into their mid-twenties. Together with a full-decade of recovery from the recession that began with the financial crisis in 2008, the ACA and economic tailwinds masked service level revenue declines and substantial cost increases from drugs, devices and medical record systems.

Capital was cheap with historically low interest rates and bond ratings were strong for hospital operators spurring construction of new wings, new hospitals and new ambulatory sites of care.

Elimination of waste and inefficiency opportunities were abundant to defend operating margins against reimbursement cuts. Quality mandates, penalties and shared savings incentives drove process improvement in pursuit of better outcomes and greater patient safety. The wheels on the volume-to-value transition train squealed and lurched unsteadily forward but gradually built up steam as the decade progressed.

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Vertical mergers, horizontal mergers and new entrants to healthcare created their own noise and provided constant external distractions, while traditional competition quietly intensified. The lines began to blur between payors, providers and high-tech companies. EMR mandates from the HITECH ACT drove billions of dollars in information technology investment and created internal distractions overshadowing all other IT Department priorities save for data security, which struck fear in the hearts of many as AI driven mal-ware and ransom-ware became highly sophisticated, effective and ubiquitous.

As we stand upon the bridge between the second and third decades of this new millennium looking forward, it isn’t difficult to see at least some of what might lie ahead.

Twenty-twenties: The coverage expansion from the ACA has been fully baked into health system budgets, but the expansion is still on shaky ground with many states still holding out and a federal administration at odds with congress over what comes next. Whatever the odds are for a collapse in coverage due to politics in Washington, the consequences could be swift and severe. In current Medicaid expansion states, millions may revert back to being uninsured. Bad debt would rise substantially, and bond rating agencies would have no choice but to downgrade the sector. Capital costs would rise and investment in infrastructure would decline.

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Every economic growth cycle eventually loses steam, and it is highly improbable that the recovery/growth cycle running from 2009–2019 will survive the twenty-twenties. Should a recession ensue, our recent record low unemployment will creep upward resulting in a reversal of fortune into a deteriorating payor mix outlook. As corporations feel the pinch in their core business margins, they will exert further pressure on commercial sector reimbursement pricing as these employers become ever more aggressive activist purchasers of healthcare.

Interest rates are being driven upward, albeit from an extended period of historic lows, just as hospital operating finances are getting squeezed, cramping capital investment in facilities. The dynamic exacerbates the phenomena of the rich getting richer and poor getting poorer as the smaller independent community hospitals become less able to keep up with maintenance and upgrades to facilities and equipment.

Absolute site-neutrality increasingly proves too enticing to government, and community hospitals become ever more dependent on the ED and ICU. With a stroke of a pen, Washington could declare that only the lowest reimbursement rate for any service will be paid by the federal government programs, regardless of the actual location and overhead costs borne by the provider site. The public perception problem of hearing that a diagnostic or surgical procedure at a hospital costs 50%–250% more at a hospital than at an independent ambulatory care facility in the same market has become a major

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risk for hospital-based health systems. Over the past decades, cross subsidies from high margin procedures have covered losses from negative margin procedures as well as underinsured patients receiving otherwise profitable services. While the higher quality (no sick people so lower rates of infection etc.) and lower cost of ambulatory sites are inherently rational, the unintended consequence of lost cross-subsidies could make either hospital finances deteriorate to unsustainable levels or demand denial of care to under-insured populations such as Medicaid. If government regulations continue to prohibit that form of care rationing (which is highly likely), smaller community hospitals may have to discontinue certain service lines denying whole communities of that service. Much of small-town America could be left with hospitals providing ED and ICU care only, or worse, no acute care hospital at all. The only certainty is that the site-neutrality debate will be heated and stressful for patients and providers alike.

Hubris surrounding the sanctity of the physician-patient relationship and the mentality of “healthcare is different” leaves hospitals vulnerable to “know-nothing” innovative disruptors entering healthcare. The Millennial generation has profoundly different views on many aspects of society that have been taken for granted for nearly a century (think home ownership, car ownership etc.). A significant portion of this newly come-of-age demographic does not care if they see the same physician twice in a lifetime. What they want is instantaneous high-quality service, all data seamlessly

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transferred and available 24/7, low cost and high convenience.

Who the specific individual doctor is might not make their top ten list of factors in seeking care. This generation has no higher regard for today’s hospital systems than they do for today’s leading tech companies. Given a choice between the two, they will likely choose the one with the easiest transparent pricing and purchasing app.

Since the big tech companies aren’t burdened with legacy hospital facilities and infrastructure, being also blessed with essentially unlimited capital resources and vast consumer relationship experience, it is not hard to imagine entirely new tech based health systems emerging over the next decade targeting the last bastion of premium revenue, the young, healthy and commercially insured.

The history of industry disruption is against us and we in the hospitalbased healthcare sector are now so very ripe for disruption. The key elements of disruptive innovation (as originally articulated by Clayton Christensen in his 1997 book The Innovator’s Dilemma) include an existing well-established market where incumbent leaders offer very complex and very expensive services that a significant segment at the bottom of the market cannot afford. Does that resonate at all for healthcare? Disruptive innovators offer less sophisticated options at dramatically lower prices with lower gross margins and capture an increasing share of the market as others grow to appreciate the lower cost option. Generally speaking, whole industry disruption requires a fundamental change in business model rather than mere product innovation. Watch out for the progression of pharmacy based urgent

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care centers into full-blown ambulatory care networks for chronic care, watch as the big tech companies evolve from promoters of simple wearable self-health widgets into constant clinical surveillance and AI driven care management service providers and watch as, telehealth emerges from hospital based to big-tech based as an utterly price transparent monthly or yearly subscription service.

The challenge for the entrenched incumbents is Self-disruption. If profound disruption happens to us rather than by us, we have only ourselves to blame. In fairness, we all prefer to do what we already know how to do well, because that is what has made us successful in the first place. Unfortunately, whether disruptive innovation comes from a new entrant to healthcare or from a current direct competitor that has taken the risk to self-disrupt, catching up after-the-fact is both extremely difficult and even in the best cases paints your reputation as a follower rather than a leader in your community. Already, those healthcare provider organizations that have been willing to engage in self-disruption, specifically to take revenue sacrificing risks to explore new business models, have begun to separate themselves from the masses who have not. By the end of the coming twentytwenties decade, the winners will almost certainly be those that lead the innovation risk taking early and the late following losers may well face existential threats of being acquired by the leaders, or worse, being ignored by them.

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There are often overwhelming Barriers to Driving Bold Innovation within our current hospital-centric health systems. Entrenched inertia and adverse incentives sap away the energy and courage to voluntarily make fundamental change that runs counter to near term financial and competitive pressures. Why would a hospital administrator encourage primary use of independent ambulatory sites of care when providing the same service at a hospital-based site offers much higher revenue and the administrator gets no credit for care that is not provided in their hospital? Why would any physician group provide routine follow-up care in a physician office where it is billable, instead of by text, email or app where it is not? Why charge a low monthly subscription for unlimited visits when you can charge more per visit and provide less frequent visits? Why offer remote patient monitoring surveillance to the highest risk 2,000 of your chronic care patients when you can just monitor the 200 most extreme cases? This line of reasoning was largely forgiven in the Twent-teens, but might not be by the end of the Twenty-twenties.

Over the course of the next full decade, the foreseeable trends are likely to put the dramatic consolidation among the U.S. hospitalbased health systems into hyperdrive and ultimately result in “The Big Crunch”. “The Big Crunch” can be thought of as the final alignment, where the multi-metro mega-systems (think Baylor-Scott & WhiteMemorial Hermann, Aurora-Advocate, Dignity-CHI) have reduced the formerly fragmented U.S. hospital market of 5,000 acute care sites into just a few dozen super-regional provider networks.

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There is time enough to prepare for the waves of change and innovation that will shape the next decade, but there is zero time to waste. We know what’s coming and we know what to do. We must not fail for lack of courage. We must not fail for lack of effort.

We must find the time, the energy and the courage to drive bold innovation to ensure we are not just another part of the problem, but rather an integral part of the solution.

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ALLSPIRE HEALTH PARTNERS AND THE FUTURE OF INNOVATION

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners / JOANNE RESNIC, MBA, BSN, RN | VP, Collaborative Initiatives, AllSpire Health Partners

With the challenges and opportunities facing healthcare today, an aggressive and thoughtful approach to innovation emerges as a key path forward for both the clinical and financial success of our member organizations. AllSpire Health Partners (AHP) undertook a series of one-on-one discovery interviews over the summer of 2018 with the health system chief executive officers and their key innovation leaders to define areas of particular focus across clinical, operational, and financial innovation. After the individual interviews, a facilitated group discussion was led by TRG Healthcare (a consultancy) with the insights gained from the CEOs. All the CEOs expressed that there is value in pursuing broad innovation strategies and in some cases, focused collaborative clinical and healthcare policy research.

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The AllSpire Health Partners CEOs developed five categories of priority focus for research and innovation.

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CATEGORY

EXAMPLES DISCUSSED

Reduce the cost of care

Technology evaluation (e.g., Robotic Process Automation for labor savings), leverage big data to uncover cost savings opportunities.

Improve the consumer experience

Pilot and share technology solutions regarding price transparency.

Drive care transformation

Share best practices in care process improvements, run big data analytics to drive appropriate care (e.g., lab, pharma, care protocols), participate in government demonstrations/ CMMI initiatives which require scale to drive better safety, quality, and access.

Advance population health strategy

Share ACO/CIN/Medicare Advantage Plan best practices, leverage the electronic medical record for population health analytics, share chronic disease management best practices.

Manage regulatory risk

Address key issues in the quality space (e.g., maternal morbidity and opioid use reduction).

The CEOs agreed that there are three tactical approaches that may be applied to any or all of the categories listed above including: • Application of emerging technology: AllSpire should think about opportunities to apply emerging technology to help drive success.

• Advancing quality in patient outcomes: Using best practice knowledge transfer and process improvement techniques to advance quality in patient outcomes.

• Leveraging ‘big data’ opportunities: Members could benefit by identifying, building and optimizing collective ‘big data’ solutions.

The CEOs further discussed some of their individual organizations’ current or planned strategies and tactics for taking the innovation path.

• Some AllSpire members have dedicated funding streams to support internal and external innovation including venture capital.

• Members see the front-line team members as an untapped resource, and some are supporting innovation internally by establishing programs to encourage and incubate staff idea generation particularly around process flow and organizational improvements.

• Innovation around care delivery is of broad interest to the members.

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• There is interest in holding innovation expos with targeted key external vendors for evaluation, either to use innovation collectively, separately at member sites, or to assess for potential investment.

• While innovation has different definitions at the member level, and the various members have different capabilities to apply towards participation in innovation programs, AllSpire may be an attractive vehicle to entice industry funding, joint venture development, or product development partnerships.

AHP is well positioned to support the membership’s vision for future innovation across clinical, operational, financial and supply chain paths. It can also serve as a clearinghouse to vet innovation and help filter opportunities and direct them to the members who have interest.

With the System CEOs continuing to set the overarching vision and key strategies for innovation, AllSpire will serve as a unique resource to further enhance each member’s innovation journey.

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SHARING STRENGTHS FOR BET TER HE ALTH

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Priority One: Cost Reduction Systemwide

SELF DISRUPTION IN HE ALTHCARE DELIVERY NET WORKS

THE WAR ON WASTE

BY PAUL J. TIRJAN, MBA | President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

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There are myriad news stories, studies and articles about waste and inefficiency in the U.S. healthcare system and given the scale of this sector of the economy, the problem is too large to approach on anything less than a war footing.

According to the CMS.gov National Health Expenditure (NHE) Fact Sheet: Historical NHE, 2016:

• NHE grew 4.3% to $3.3 trillion in 2016, or $10,348 per person, and accounted for 17.9% of Gross Domestic Product (GDP).

• Medicare spending grew 3.6% to $672.1 billion in 2016, or 20 percent of total NHE. • Medicaid spending grew 3.9% to $565.5 billion in 2016, or 17 percent of total NHE. • Private health insurance spending grew 5.1% to $1,123.4 billion in 2016, or 34 percent of total NHE. • Out of pocket spending grew 3.9% to $352.5 billion in 2016, or 11 percent of total NHE. • Hospital expenditures grew 4.7% to $1,082.5 billion in 2016, slower than the 5.7% growth in 2015.

• Physician and clinical services expenditures grew 5.4% to $664.9 billion in 2016, a slower growth than the 5.9% in 2015.

• Prescription drug spending increased 1.3% to $328.6 billion in 2016, slower than the 8.9% growth in 2015.

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SELF DISRUPTION IN HE ALTHCARE DELIVERY NET WORKS

• The largest shares of total health spending were sponsored by the federal government (28.3 percent) and the households (28.1 percent). The private business share of health spending accounted for 19.9 percent of total health care spending, state and local governments accounted for 16.9 percent, and other private revenues accounted for 6.7 percent.

The trends going forward won’t make things any easier: Projected NHE, 2017–2026:

• Under current law, national health spending is projected to grow at an average rate of 5.5 percent per year for 2017–26 and to reach $5.7 trillion by 2026. While this projected average annual growth rate is more modest than that of 7.3 percent observed over the longer-term history prior to the recession (1990–2007), it is more rapid than has been experienced 2008–16 (4.2 percent).

• Health spending is projected to grow 1.0 percentage point faster than Gross Domestic Product (GDP) per year over the 2017–26 period; as a result, the health share of GDP is expected to rise from 17.9 percent in 2016 to 19.7 percent by 2026.

• Projected national health spending and enrollment growth over the next decade is largely driven by fundamental economic and demographic factors: changes in projected income growth, increases in prices for medical goods and services, and enrollment shifts from private health insurance to Medicare related to the aging of the population.

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• Among the major payers for health care, growth in spending for Medicare (7.4 percent per year) and Medicaid (5.8 percent per year) are both substantial contributors to the rate of national health expenditure growth for the projection period.

Both trends reflect the impact of an aging population, but in different ways. For Medicare, projected enrollment growth is a primary driver; for Medicaid, it is an increasing projected share of aged and disabled enrollees.

• The recent enactment of tax legislation that eliminated the individual mandate is expected to lead to a reduction in the insured rates. Economic factors, such as projected GDP growth and employment trends, are the primary factors contributing to a slight projected decline in the insured share of the population from 91.1 percent in 2016 to 89.3 percent in 2026.

For simplicity sake, if we use a “ballpark” assumption of 10% waste across our national health expenditure, we have a $330 billion savings opportunity from reduction of waste. That’s a lot to work on.

SO WHERE DO WE START?

• Over-paying for supplies • Inefficient overhead • Paying for things unused • Spoilage • Unnecessary care • Duplication

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SELF DISRUPTION IN HE ALTHCARE DELIVERY NET WORKS

OVER-PAYING FOR SUPPLIES

Most Integrated Delivery Networks (IDNs), or hospital-based health systems, are not getting the lowest price that vendors are willing to sell any given good or service. As a rough rule of thumb, supply chain expenditures run from 15% of net enterprise revenue for the hyper-efficient to 25% of net enterprise revenue for the least efficient. For frame of reference, direct labor generally constitutes the largest portion of expense at 50% or greater. The difference between those IDNs paying closer to 25% and those closer to 15% has as much to do with size of the IDN as anything else, but even within like-sized enterprises the differences can be dramatic.

Vendors of goods and services sell to larger institutions or collective bargaining pools within formal group purchasing organizations (GPOs) or cooperatives to save money in the form of cost-of-sales and implementations, as well as realize strategic advantages from market share gains and prestige customer wins. As a result, the vendors are willing to sell at lower per-unit prices or offer higher rebates and similar incentives. As this all occurs in a private freemarket environment, natural discrepancies in total cost develop and it falls to the individual IDN to negotiate better deals.

Where the commodity price differential crosses over into true waste is when any one buyer pays more for the exact same product from the exact same vendor than another buyer of the same size and purchasing volume. This phenomenon can be thought of as attaining Price Parity Against Benchmark and requires data driven negotiation with vendors.

The most egregious form of over-payment waste is when two entities within the same purchasing group (two hospitals in the same health system for example) pay two different prices for the same product from the same vendor. We refer to this as Internal Price Parity and this represents some truly low hanging fruit for waste reduction as it requires no change in purchasing and no external negotiation.

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INEFFICIENT OVERHEAD

Often relatively simple operational changes that have no effect on patient care can have significant cost impacts on healthcare providers. For example, hospitals are particularly heavy energy utilizers. Many non-core activities, such as laundry and linen, food preparation, equipment maintenance or repair and garage lighting use energy at peak cost times when slight adjustments in operating time of day could drop rates for the same number of kilowatts or BTUs. PAYING FOR THINGS UNUSED

One of the most painful types of waste to countenance in healthcare is the purchasing of goods and services that are never actually used for their intended purpose. All too often excess medical supplies are placed into standardized procedure kits to improve Operating Room or Emergency Department throughput, only to be discarded as unused and unusable once the kit has been opened. This can happen because the size didn’t match the patient need, the kit had items that weren’t needed or because improper handling rendered the product unsafe to use.

Increasingly, healthcare providers are evolving into data and communications companies. Unfortunately, while hospitals may have 100 years of accumulated experience in surgical care, they are far less expert in managing software licenses and telecommunications services. With seat-based services and licensing fees tied to a vast and ever changing workforce, many excess telephone lines are paid for but never used or paid at the wrong pricing tier, software seats are purchased but never assigned, systems become obsolete or are abandoned but the service fees are never terminated from contracts and sometimes legacy equipment goes missing during upgrades or is underutilized while still fully functional.

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SPOILAGE

Many products hospital health systems acquire, store and utilize have a short shelf life such as drugs, blood and food. Ineffective inventory expiration management can result in the need to dispose of spoiled materials before they can benefit patients.

OUTSOURCING AND INSOURCING OR BUY VERSUS BUILD

When are the efficiency gains of an outsourced focused-factory type of operation worth more than the combined profit margin and overhead of the outsourced company? Conversely, when is it more efficient to bring a functional area in-house once additional distraction, space and labor burden on management is factored in? These can be very complex questions to answer, but any substantial differential in total cost represents waste to the system.

UNNECESSARY CARE

Over utilization, including conducting clinic visits and tests for the sole purpose of billing as well as inappropriate prescription of drugs, diagnostics and therapies, constitutes the most common instance of unnecessary care. However, the opposite can also be a driver. Failure to diagnose, monitor and treat patients early enough or often enough results in unnecessary use of the Emergency Department as a primary care service site. The ED is extremely expensive for routine urgent care, prevention and management of chronic conditions. Thus, the consequence of failure to utilize sufficient low cost services produces waste in the form of predictable and preventable higher cost care.

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DUPLICATION

Duplication of administrative tasks and patient diagnostic services represent a unique variant on unnecessary care. Fragmentation of the provider community, both between competing IDNs and among clinical providers within a single IDN, creates communication gaps that lead to repetition of efforts that add no additional value. Temporal gaps can be just as wasteful in that lab tests or imaging can be repeated too frequently to be of value or they can be conducted when results will come too late to affect care. In these cases, the additional data may well have been valuable if delivered in a timely manner, but if the decision to treat needed to be made before the result could be factored in, then the cost of the test becomes a wasted resource.

Addressing each type of waste requires focus, dedicated effort and a non-trivial investment in data resources. Nationally, the opportunity is immense. The consequences of failure, are potentially financially catastrophic. There is a screaming need for innovative approaches to waging a war on waste.

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SITE NEUTRALITY I Would Not, Could Not, Here Or There

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

Site neutrality refers to the synchronizing of government reimbursement levels for the same procedure provided in a hospital outpatient department or separate hospital owned outpatient facility as for the procedure when it is performed in an independent physician office, ambulatory surgery center, independent imaging center or other approved site of care.

Historically, hospitals have received a higher reimbursement rate (nearly double in some cases) across most such services to compensate for the higher infrastructure costs, regulatory burden, and requirement to provide emergency care and active labor support to all patients regardless of ability to pay.

Increasingly, elected officials have found the price discrepancy an attractive short-term cost savings opportunity.

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CMS EMPOWERS PATIENTS AND ENSURES SITE-NEUTRAL PAYMENT IN PROPOSED RULE CMS press release—Jul 25, 2018

“ The proposed policies in the CY 2019 Medicare Hospital Outpatient Prospective Payment System (OPPS) and Ambulatory Surgical Center (ASC) Payment System proposed rule would help lay the foundation for a patient-driven healthcare system. To increase the sustainability of the Medicare program and improve quality of care for seniors, CMS is moving toward site neutral payments for clinic visits (which are essentially check-ups with a clinician). Clinic visits are the most common service billed under the OPPS. Currently, CMS often pays more for the same type of clinic visit in the hospital outpatient setting than in the physician office setting.

If finalized, this proposal is projected to save patients about $150 million in lower copayments for clinic visits provided at an off-campus hospital outpatient department.”

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What was left out of the press release is the approximate $760 million cut in total reimbursement to health systems (savings to the Medicare program in Fact Sheet accompanying the full release) as a result, which will put a disproportionate share of margin pressure on the smaller independent community hospitals.

Perhaps not surprisingly, the American Medical Association (AMA) largely supports site neutrality while the American Hospital Association is largely against it.

To understand site neutrality writ-large, we must first understand what’s effected, the case for it, the case against it and the sensitive trade-offs among stakeholders.

• Bread and butter services • Better quality • Better experience • More efficient • Lower capital cost • No cost subsidies to other payor populations • No cost subsidies to low volume specialized care BREAD AND BUTTER SERVICES

The first step in understanding site neutrality is defining the scope of what services are potentially affected and which are not. At the highest level, the most likely candidates are procedures that are already widely available in an independent ambulatory setting, such as an Ambulatory Surgery Center (ASC), Imaging Center, Urgent Care Center, and Specialist Physician Clinic.

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The services these sites provide are the “bread and butter” routine care also provided by hospital outpatient departments. What is not currently contemplated in site neutrality is trauma, high acuity emergency care, transplantation, open heart surgery, intensive care unit services or other high-risk procedures. Often, in smaller independent community hospitals, there are not sufficient volumes of patients with need for the high-risk care to support local programs to begin with. Such hospitals would have little service left in the hospital were they to lose the “bread and butter” orthopedics, spine and gastroenterology cases entirely.

Further, these smaller community hospitals are the least able to afford capital investment in ambulatory care networks and least able to function on ambulatory reimbursement rates at the hospital.

Some of the wave of small hospital bankruptcies and consolidation can already be attributed to this shift to ambulatory care.

BETTER QUALITY

One of the strongest arguments for ambulatory care facilities is that being focused on a single clinical function supports standardization and attention to detail without distraction. Since there is no Emergency Department, and there are no long-termstay or infectious disease patients, there is a relatively nominal risk of infection due to the absence of sick people. The net result is generally significantly higher quality outcome measures across the board, even when the physicians are the same at the hospital as at the ambulatory care site.

BETTER EXPERIENCE

Generally, because ambulatory care sites require less space with fewer restrictions on construction requirements, they tend to be situated in more convenient and patient friendly locations. In addition, ambulatory care centers tend to be smaller, less hectic and thus less intimidating to patients and their families.

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MORE EFFICIENT

Particularly with ASCs and imaging centers, the lack of trauma patients and codes means fewer disruptions to scheduling, more on-time starts, faster turn-around times and higher consistency of procedures.

LOWER CAPITAL COST

Depending on local and state building and licensure codes for hospitals, ambulatory care sites are typically more than 50% less expensive in construction and infrastructure requirements. In the non-profit sector, those savings could be somewhat offset by the income taxation rate on taxable independent ambulatory care, but the front-end savings is an immediate capital requirement advantage for non-hospital facility development.

NO COST SUBSIDIES TO OTHER PAYOR POPULATIONS

EMTALA, the Emergency Medical Treatment and Active Labor Act According to the American College of Emergency Physicians: “ EMTALA has become the de facto national health care policy for the uninsured. It requires Medicare-participating hospitals with emergency departments to screen and stabilize patients with emergency medical conditions in a non-discriminatory manner, regardless of ability to pay, insurance status, national origin, race, creed or color.

Ninety-two percent of all hospitalizations for the uninsured are directly linked with an emergency department visit.”

While estimates vary on Medicare and Medicaid reimbursement to hospitals from 93% of cost to 88% of cost, these are financial deficit populations for the most part.

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In an ambulatory care facility, there is no need to fund money losing undercompensated care from Medicare, Medicaid or uninsured patients. The loss of the profitable commercially insured patients to non-hospital facilities reduces critical subsidies at the health system.

NO COST SUBSIDIES TO LOW VOLUME SPECIALIZED CARE

For mid-sized community hospitals that are just large enough to support advanced oncology, transplant or infectious disease programs, the loss of high-volume high-margin procedures to nonhospital facilities reduces cross subsidies to the high-end services.

These marginally financially viable programs may no longer be sustainable in the local community without such cost subsidies.

With a clear understanding of the site neutrality issues, we can turn to innovation and care redesign at the health system and community level to navigate this aspect of our shifting landscape.

As with Dr. Seuss’s Green Eggs and Ham, once we try it, we may find that we can provide most of our services just about anywhere.

Just don’t count on a price premium to subsidize other services as a long-term strategy.

Sources: Seuss, Dr. Green Eggs and Ham. New York: Random House, 1970

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THE TROUBLE WITH PRICE TRANSPARENCY Why There Are No Bluelight Specials In Healthcare

BY PAUL J. TIRJAN, MBA

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President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

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For those who don’t recall, the Kmart store phenomenon known as the Bluelight Special involved an actual in-store alert lamp that signaled a one-hour-only pricing opportunity for a specific product.

It was only visible to customers that were already in the building and everybody knew the exact price that was being offered for the “special� because it was the price itself that was special. There were no competing prices to consider during the offer period. The intent was to sell a given product to shoppers who might not otherwise even consider buying the product.

While this form of radical price transparency worked to a degree, you will note that this particular price transparency practice was discontinued, the company ultimately went bankrupt. The point is that price transparency has limits and risks, thus, the how, when and where are important.

First, generally speaking, there is little in the healthcare services sector that is likely to be purchased frivolously by someone already in the building for another purpose. To the extent people shop for services in healthcare at all, the key consumer decision is where to buy and not what to buy. Further, if the service required has any urgency to it, location and accessibility is a major factor. If the service required has any degree of acuity or risk, confidence in quality reputation and pre-existing relationship are paramount. So, engaging the healthcare consumer needs to begin long before the customer can see the Bluelight and price may not be among the very top priorities.

That said, no one wants to get gouged or overpay for commoditized services when cost differentials among comparable providers can reach hundreds or even thousands of dollars out-of-pocket.

Where does that leave a high-quality provider who is competing with a low-cost provider? What should the message be? To whom? When?

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Let’s start by unpacking some of the complexities of pricing as they apply to healthcare: • Fee-for-service incentivizes volume • Patients don’t understand nuanced value • Third party payor model disconnects consumers and distorts actual pricing • Price transparency encourages race to lowest price and often to lowest quality • Fragmentation across the care continuum can lead to wrong conclusions on total cost • Total risk adjusted cost of healthcare is unavailable and incomprehensible FEE-FOR-SERVICE INCENTIVIZES VOLUME

What we refer to as fee-for-service reimbursement in healthcare is simply getting paid for the work you do and not the outcome or effect of that work. There is an inherent rationality to it. We are accustomed to this model in almost all private sector service industries. It feels familiar.

Unfortunately, getting paid more for providing more healthcare services creates an adverse incentive. Specifically, it incentivizes over-utilization or an unnecessary volume of visits, procedures and therapies. Good for the provider financially, not so good for the consumer or institution paying the bills.

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PATIENTS DON’T UNDERSTAND NUANCED VALUE

Quality in healthcare is hotly debated and poorly understood.

The concept, definition and measurement of “value” in healthcare is far worse, and that is just within the expert community. Federal regulations, healthcare insurers and healthcare providers have begun in earnest to explore payment-for-value as an alternative to pure fee-for-service over the past decade. Sadly, this has been done without any progress towards patients understanding value.

Yet, with deductibles rising, patients bear much of the burden and often carry first-dollar risk. No true price transparency can be meaningful without consumer comprehension of the value they are pricing.

THIRD PARTY PAYOR MODEL DISCONNECTS CONSUMERS AND DISTORTS ACTUAL PRICING

The origins of the third-party payor model were honest in intention and necessary for the circumstances. Throughout history, up until the past hundred years, healers and caregivers received payments directly from the families of the sick and wounded they treated. This meant the wealthy were well cared for by professionals, while the poor were generally cared for by family, friends and neighbors. As work became more mechanized and medicines more standardized, workers and their employers realized that they could pool resources prospectively to fund care for the sick and wounded. As both the medical field and insurance industry matured in the latter half of the 20th century, the financial separation of care providers and patients became more pronounced and entrenched. Today, healthcare consumers have no say or even visibility into either actual price paid to providers or utilization patterns and appropriateness until long after purchasing decisions have been made.

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PRICE TRANSPARENCY ENCOURAGES RACE TO LOWEST PRICE AND OFTEN TO LOWEST QUALITY

Among price sensitive shoppers of any service, price transparency enables and encourages purchasing based on price. As in any industry, the fundamental assumption is that the price comparison is among like or similar goods or services. The challenge within healthcare is determining if any given service is like or similar enough to let price drive decision making.

The risk is that price transparency within a fee-for-service healthcare system encourages a race to the lowest price provider, which may be the lowest quality provider or at least not the highest quality provider. The hidden cost is what happens downstream from the price driven purchase. Bad things can and do happen with low quality providers. The costs from complications can far outweigh the total cost of the original service, not just the original cost savings.

FRAGMENTATION ACROSS THE CARE CONTINUUM CAN LEAD TO WRONG CONCLUSIONS ON TOTAL COST

Even when a given test or procedure is both high quality and low cost, it still may not reduce total cost or improve total outcomes. We humans are complex creatures. What cures us in one way, might harm us in another. Our healthcare systems are also complex, what “excess� revenue is generated in one service line may be subsidizing costs in another.

The fragmentation of providers of healthcare across the care continuum can cause price-transparency based decisions in any one segment, without integration into the context of other segments, to lead to wrong conclusions on total cost, especially over longer periods of time.

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TOTAL RISK ADJUSTED COST OF HEALTHCARE IS UNAVAILABLE AND INCOMPREHENSIBLE

Price transparency for total risk adjusted cost of healthcare is necessary for meaningful value based purchasing of healthcare.

Today’s Bundled Payment mechanisms are a first foray into this realm, but, as yet, are both limited to specific episodes of care and are wholly unavailable and incomprehensible to common customers.

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PATIENT AFFORDABILITY Half A Trillion Here, Half A Trillion There, It Starts To Add Up

BY PAUL J. TIRJAN, MBA

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President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

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The cost burden of healthcare on American society is no joke. The general public is acutely aware of the problem. However, outrage is somewhat muted because as painful as the direct cost to patients is, more than 90% of the costs are paid indirectly via taxes and lower wages. According to the Kaiser Family Foundation using CMS National Health Expenditure Data, Americans will be spending over $500 billion every year out-of-pocket beginning just five years from now. Most of rest of the $5 trillion per year spent on healthcare will be paid by the federal government and employers, which means we will be paying that as well, just not directly. As providers of healthcare, we have both immense opportunity and equally immense challenges ahead. The key is to ensure that we provide the services our patients need in such a manner that our communities can afford to buy them.

ANNUAL OUT-OF POCKET SPENDING, IN BILLIONS, AND THEIR SHARE OF TOTAL NATIONAL HEALTH EXPENDITURES, 2010–2023¹

$600 Projected $500 $400 $306

$316 $328

$339 $338 $346

$356

$372

$391

$414

$437

$461

$486

$512

$300 $200 $100 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 OOP as a Share of Total NHE:

11.8% 11.7% 11.7% 11.7% 11.1% 10.8% 10.5% 10.4% 10.3% 10.2% 10.2% 10.1% 10%

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9.9%

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Patient out-of-pocket affordability has two sides, the cost of care required by a patient population and the relative ability to pay for the same patient population.

Some critical components of out-of-pocket cost include: • Premiums for health plans • Deductibles, co-payments and co-insurance • Private pay services, OTC drugs and cash-and-carry medical devices PREMIUMS FOR HEALTH PLANS

Premiums for health plans are the most predictable and prospective out-of-pocket expenditure. For employees of companies that are self-insured or government employees, there may not be much choice in whether to buy insurance and few choices among plan networks. Many employees make their selections during an open enrollment period and forget about premium payments for the next year as they are deducted from paychecks along with other types of taxes. However, the specific plan features selected may have significant impact on network provider selection and therefore downstream out-of-pocket expenditures such as deductibles, co-payments and co-insurance.

DEDUCTIBLES, CO-PAYMENTS AND CO-INSURANCE

Deductibles, or the portion of first-loss insurance risk retained by insured people, is the amount of healthcare expenditure a patient is responsible to pay before the insurer begins to pay their percentage of claims. After the deductible is met, the insurer pays claims from providers at a negotiated discount minus either a fixed co-payment from the patient at the point of sale or a pre-defined co-insurance percentage of contractually allowable cost.

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Deductibles are designed to provide insured patients with an incentive to not purchase or utilize any services below the level of the deductible for the entire year. Co-payments and co-insurance are designed to provide a dis-incentive for patients to use any given medical service after the deductible is already met. The exact structure of these incentives is part of Plan Design and traditionally patients have no say in Plan Design, only plan selection. Therefore, patients are held financially accountable for their costs without being allowed to participate in any price negotiation or contractedprice based provider selection or incentive structuring.

Normal seasonality distortions and artificially delayed care due to deductibles and co-insurance financing also add to the total cost of care. Beyond the natural seasonality, such as flu season in winter, dehydration from heat in summer and allergies in spring or fall, there are unnatural fluctuations in care utilization throughout the year. Since most health benefit years are set to calendar years, and since the incentive to not use services until the deductible is met resets on January 1st each year, a significant amount of non-urgent, elective, health maintenance and preventive care is postponed until later in the year. This creates both operational inefficiencies and has negative health effects in that it can result in a patient’s condition deteriorating, or going undiagnosed, until the problem escalates and requires more expensive intervention and possibly ends in a worse clinical outcome.

PRIVATE PAY SERVICES, OVER-THE-COUNTER DRUGS AND CASH-AND-CARRY MEDICAL DEVICES

Many medical products and services fall outside the scope of health insurance coverage and are purchased entirely by out-of-pocket payments from patients and their families.

As the elderly accumulate chronic conditions and lose the ability to execute activities of daily living, families that can afford to pay turn to private duty nursing and nursing assistant services in the home

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for additional support. Patients of any age can spend substantial sums on non-prescription over-the-counter medications, which in many circumstances are as effective as far more expensive drugs that still require a prescription. Similarly, certain home medical equipment such as walkers and canes can dramatically reduce falls and hospitalizations, while private medical alert systems can dramatically expedite treatment when patients are alone at home.

What is often not fully factored into the cost savings from these goods and services is the reduction in out-of-pocket expenses from the lack of unnecessary clinic visits and the avoided costs in prevented emergency room visits.

Some variation in needs among populations:

The Journal of the American Medical Association (JAMA) has developed a pictogram illustrating the age and gender differentials in expenditures for the U.S. population. Two intuitive but glaring revelations are that the overwhelming majority of all health expenditures in the U.S. occurs in the population over 50 years old and an even more dramatic burst of expenditure on a per capita basis occurs after age 65.

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Age group, y

Female

Age group, y

Male

≥85 80–84 75–79 70–74 65–69 60–64 55–59 50–54 45–49 40–44 35–39 30–34 25–29 20–24 15–19 10–14 5–9 1–4 <1

Female

Male

≥85 80–84 75–79 70–74 65–69 60–64 55–59 50–54 45–49 40–44 35–39 30–34 25–29 20–24 15–19 10–14 5–9 1–4 <1 120

80

40

0

40

80

Spending (Billion US Dollars)

120

30 25 20 15 10 5 0 5 10 15 20 25 30 Spending per Person (Thousand US Dollars)

Aggregated condition category Communicable diseases Neoplasms Cardiovascular diseases Chronic respiratory diseases Cirrhosis Digestive diseases Neurological disorders

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Mental and substance use disorders DUBE Musculoskeletal disorders Other noncommunicable diseases Injuries Well care Treatment of risk factors

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Care of the elderly and chronic conditions:

Due to cultural, geographic and workforce mobility differences, the American approach to the care of the elderly and the chronically ill is markedly different from other countries. In many countries, where adult children of frail and chronically ill parents are near enough, much of the care of the elderly is still provided by the extended family and local community. In the United States, much of this care is purchased by professional providers at significant cost. For a variety of reasons including adverse financial incentives, fear of litigation and culture, an extraordinary amount of money is expended in the final six months of life. Often this end of life care has no potential for either length or quality of life and occasionally is provided against the wishes of the patients themselves. Difficult choices at end of life can be highly emotional and politically charged at the policy level.

ANNUAL PER CAPITA HEALTHCARE COST BY AGE

$45,000

US Germany UK Sweden Spain

$40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 $0 10

48

20

30

40

50

60

70

80

90

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Some obstacles to efficient use of out-of-pocket spending:

There are many obstacles to efficient use of out-of-pocket spending on health. Some are referred to as Social Determinants of Health.

Some of these obstacles include the availability of quality food or condition specific nutrition, an unhealthy environment, a lack of safety, insufficient exercise, risky anti-health behaviors and a host of addiction ailments.

Among the poor, the basic supports for healthy living simply do not exist. There are often valuable community resources available, but they are as fragmented and difficult to navigate as the formal health care provider community. Teaching how to spend the limited resources of vulnerable populations wisely may increasingly fall to the provider community.

Sources: 1. K aiser Family Foundation calculations using NHE data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group, at http://www. cms.hhs.gov/NationalHealthExpendData/(For 2010–2012 data, see Historical; National Health Expenditures by type of service and source of funds, CY 1960–2012; file nhe2012. zip. For 2013–2023 data, see Projected NHE Historical and projections, 1965–2023, file nhe65-23.zip).

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PROVIDER TO EMPLOYER Rethinking The Middlemen

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

Much of healthcare finance is intermediated by third parties who add cost to the system and take profit margins away from the provision of care. What value do these organizations bring to the table?

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The core functions of health insurance companies include: 1. Assessing and bearing risk, 2. Benefit and incentive plan design, 3. Negotiating discounts, 4. Authorizing or denying services, 5. Processing claims so that providers get paid and 6. Marketing.

Third party administrators do just 3, 4 and 5, with self-insured employers handling plan design and bearing the risk. In theory, most of claims processing could be automated and discounting agreements with provider networks could be handled directly by employers. Further, with sufficiently conservative pricing of risk and a large enough risk pool, there may not be a need for a risk bearing entity beyond the premiums submitted. Finally, a thorough programmatic system of order sets and care plans in an EMR could obviate the need for prior-authorizations and eliminate denials after-the-fact.

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This begs questioning what the value added by health insurance companies might be in 5 to 10 years. Where individuals are buying insurance for themselves, such as Medicare Advantage plans or ACA individual plans, it is the discounts that aggregated purchasing can capture that add the bulk of the value. In the fully-insured small group markets, it is predominantly the denials and restrictive coverage that add short term savings value to customers. Among self-insured employers, there may not be a role at all.

To the provider community, network loyalty and continuity of care efficiencies from commercial bundles are the near-term keys to building deeper relationships with the non-healthcare employers in their community.

Over time, these relationships will need to evolve to compete with the relationships that the new entrants to healthcare are building with these same populations and employers. Payor-pharmacy companies, telecom-media-internet companies and traditional retail companies all have deep pockets and pre-existing relationships with employees and employers. It is a small matter for many of them to outspend hospital based health systems on winning the hearts and minds of healthcare consumers. We rely on the premise that the doctor-patient relationship is sacrosanct and permanently aligned with health systems. The millennial generation has already debunked that myth.

What value remains in the health insurer realm is likely in their aggregated purchasing power. The largest insurer in any given market continues to enjoy dramatically lower pricing from providers who cannot afford to be an out-of-network provider with them.

However, this too may reach a tipping point and break down if a high enough percentage of the population is covered by government and self-insured employers. The health insurers may simply become irrelevant.

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None of this gets at the true cost of health to employers in the long run. Even the escalation in the price of drugs, devices and services pales in comparison to the impact from growth in utilization. Limited real value has been attained from wellness, fitness and prevention programs offered by employers, with the possible exception of financial incentives to employees for achieving self-directed wellness metrics. The challenge is how can employers get their employees to change behaviors early enough, and sustain them long enough, to avoid illness and injury in the first place?

It is in this area that advanced predictive analytics, communications and innovation can begin to make an impact where past approaches have failed. A new relationship between care providers and whole workforces will need to emerge that prospectively engages every employee in a custom lifestyle and health plan designed to maintain health through incentives, data, support resources and personalized care. Waiting until illness, pain or early symptoms become apparent may be too late, both in terms of low cost clinical intervention and in maintaining primacy in the relationship with the consumer. Once a Google or Amazon search for help begins, trust, loyalty and confidence in the provider network will be lost. Continuous consumer engagement may well determine who leads and who follows in the future of healthcare.

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2

Making Sense Of The Media, Mergers And Non-Traditional Entrants Into Healthcare

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AMAZON, BERKSHIRE HATHAWAY, & JP MORGAN CHASE Employerâ&#x20AC;&#x2122;s Taking Control Of Employee Health

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

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BUSINESS FACTS

The financial facts of healthcare for employers is stark and when looking forward, concerning. Employers currently provide coverage for approximately 151 million employees and their dependents. In contrast, 68 million patients receive Medicaid coverage and Medicare covers 58 million patients. From 2006 to 2018, employers have seen healthcare costs per employee rise by 75%, while wages have only risen by 25%. In real terms, total costs for coverage for a family of four in 2018 is expected to be over $28,000 which includes employer and employee premiums, deductibles, and out of pocket costs according to the Milliman Medical Index. This is up from $20,000 in 2010. For PPO plans, which are a popular employer insurance offering, of the average PPO plan cost of $19,000, 68% ($13,000) is borne by the employer and 32% ($6,000) by the employee. For employers, this share is just another cost in the employment of their work staff.

Significantly though for employees, while the employer’s share is not counted as taxable compensation by the IRS, employers view it as a part of their total employees’ compensation. It is already spent and not impactable by the employee. With rising healthcare costs, employers are more constrained in offering rising salaries or other benefits. It benefits no one to see healthcare costs rising. More importantly, employers will not allow this trend of upwardly spiraling costs to continue. They are driving change. [Only a small number of healthcare providers have seen this future and are partnering to be a part of that future].

FIRST ATTEMPTS

The goal for employers is to have better control of costs, better visibility into those costs, and better outcomes for their employees.

Historically, employers have focused on the data of costs and categories of spend. This has been difficult for employers to obtain in the past and the insurers have been reluctant to share. With the advent of more insurers going to self-funded insurance plans, the data barrier is being broken by the employer’s demand for data

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and their participation in its analysis. In addition to the self-funding of their plans, more employers are offering consumer-driven health plans such as health reimbursement accounts (HRA) or health savings accounts (HSA). These plans offer savings to the employer, but the employee can also realize savings and can exert more control over the spending of those dollars. As with all currently self-funded employer health plans, HIPAA regulations protect the employee’s data from the employer organization.

An approach which has had promise and employer interest are wellness and preventative medicine programs. With improved diet, exercise, and stress management, employees should have better health. With more preventative medicine approaches, employees should experience not just better health but when illness or changing health status occurs, the earlier recognition and focus should result in less expensive utilization and lower costs. While employees give these programs high marks, reduced costs and better outcomes are not an immediate result. Wellness programs are tackling difficult conditions such as obesity, diabetes, smoking and elevated cholesterol. The health benefits to improvements in these conditions unfortunately lag by some 5–10 years. It is the large employers with stable workforce numbers that have the most to gain.

EMPLOYERS ARE INNOVATING

Employers are entering into agreements with providers to manage costs and improve quality. For example, Cisco Systems in Silicon Valley has partnered with Stanford Health to manage the care of its employees. Stanford Health is monitoring health indicators for cost and quality outcomes. There is upside bonus potential if Cisco employees receive better care per the quality metrics followed and are happier with the care provided. If metrics don’t improve, Stanford Health pays a penalty. Many providers have developed onsite clinics with their employer partners for more direct access and more timely care. In the acute healthcare setting, provider

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based onsite employee clinics in hospitals have improved staff engagement and satisfaction and reduced absences from work due to having physician appointments offsite. Cisco has seen a 10% overall reduction in costs, and the onsite clinic costs 30% less than offsite physician offices. However, a criticism of this approach is that it only works for the very large employer with a large onsite employee base.

Healthcare organizations are also taking the lead in providing telemedicine visits for their staff. Those organizations with an employed physician staff can leverage telemedicine to balance office visit demand with telemedicine physician staffing. When the telemedicine staffing is distributed across multiple physician clinic sites, overall clinic efficiency is improved, patient satisfaction is increased, and costs to the patient are one third to one half as much.

Some large employers have taken an additional step in their partnerships with providers. With the support of Pacific Business Group on Health they have negotiated bundled payment amounts for care in several high volume, high cost procedures with hospitals for Lowe’s, Walmart and other large employers. The Pacific Business Group on Health has developed an Employers Centers of Excellence Network which includes such healthcare providers as Cleveland Clinic and Geisinger Clinic. The network has contracted to provide measurable, high quality outcomes for a fixed bundle price. Patients are referred to these sites for the procedures designated by the contracted bundles and copays are less and travel expenses are covered.

DISRUPTING THE HEALTHCARE NORM

Jeff Bezos has been quoted as saying, ”Your margin is my opportunity”. These five words have served Amazon well. From an online bookstore, to online retailer, to business e-commerce platform, pharmacy distribution network, and bricks and mortar grocery distribution network, Amazon has used this philosophy to

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disrupt traditional business models. Amazon now has healthcare in its sights. Waste, inefficiency, and bureaucracy currently existing in healthcare demonstrate that significant dollars can be in play to the benefit of a savvy employer. Amazon, JP Morgan Chase and Berkshire Hathaway have come together to form a business alliance to impact these cost and service issues focusing on their collective employees first.

Amazon’s net sales in 2017 were $178 billion. Amazon has 300 million users of its website with 30 million mobile app users.

100 million users now pay $119 per year for the Amazon Prime service. The data that Amazon possesses on its 300 million users is robust and comprehensive and ongoing. More impressive is Amazon’s ability to analyze the market utilizing web scaping technology to know what the rest of the market is doing, especially in terms of pricing. This analytics capability should not be lost on the healthcare market. Remember, “Your margin is my opportunity”.

AMAZON’S NEXT STEPS

Amazon already sells medical equipment and supplies to the consumer market. Through its business to business e-commerce platform, Amazon has been selling medical supplies to provider organizations. Currently, Amazon is licensed to sell medical supplies in almost all states and territories of the US. With its data web scraping and data analytics capabilities, Amazon can suggest best pricing for medical supplies and those supplies or equipment which have the best “recommendations or outcomes” (think Cochrane Database, UpToDate, medical journals). Amazon could evolve into a Group Purchasing Organization for all of healthcare. Amazon now has over 300,000 businesses that sell over Storefronts, its e-commerce platform. It would be a small step to serve in that capacity for medical equipment and supplies.

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Amazon’s purchase of PillPack positions it as a mail-order pharmaceutical supplier with licenses in 49 of 50 states. PillPack has a strong reputation as a customer focused and reliable merchant and offers the added benefit of expanding the over 65-year-old market to the Amazon platform. The opportunity for the bricks and mortar Whole Foods grocery chain to support development of onsite pharmacies can make more acute pharmacy fulfillment needs a reality. The next logical step would be to partner, purchase or create a PBM. As the low-cost provider, existing PBMs would feel the pressure. Furthermore, its current data capabilities could support patient portals, behavioral data mining, compliance determination and overall patient tracking.

Amazon’s least appreciated disruption could be its Echo and Alexa devices and underlying artificial intelligence (AI) technology which now support many aspects of our daily lives with information retrieval and digital assistant duties. These devices paired with a screen would make telemedicine ubiquitous. Current telemedicine platforms are communication only. The Alexa personal assistant conversational AI capabilities could empower many patients towards increased communication with their “provider” and could monitor patient status and medication compliance. IBM’s Watson already has been performing medical diagnostic determinations with speed and accuracy at or near human levels. Might Alexa be on that track? What will that mean to CVS’s MinuteClinics or any primary care practice for that matter?

OTHER DISRUPTORS

CVS Health now addresses big data, population health, retail pharmacy distribution, pharmacy benefits management via Caremark, and nonemergency, retail pharmacy associated medical clinics for routine, low acuity illnesses and conditions. Their Aetna acquisition strengthens the population health capabilities already present in CVS Health with greater linkage of claims, conditions, utilization, and compliance.

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Apple and Stanford Health earlier this year announced an atrial fibrillation study correlating rhythm disturbances with the wearable iWatch and classic ECG methodologies. What is astounding is in October, 2018, they closed the study to recruitment of new patients. 420,000 iWatch participants had already enrolled and were participating in the study. Continued evolution of the iPhone/iWatch platform could see it emerge as a leading remote monitoring system for patients at home or in assisted and skilled nursing facilities. Apple already entered the market with the Apple Health Viewer (see LVHN article within) which aggregates data from participating healthcare providers and LabCorp at the single patient level. Furthermore, Apple has released its application program interface to third party developers for potential enhancements and added capabilities.

THE WARNING TO HEALTHCARE

Healthcare leaders used to wonder about if outside competition and innovative disruption to their core competencies would occur. Then they wondered when this would occur. Now they are pondering how bad the impact will be. The focus should be what must I do now to innovate and disrupt my own organization with the goal of strengthening my position in the market. The forward progress of Amazon, CVS, Apple, and others will continue. The challenge is finding how to retain and enhance the one thing that healthcare organizations used to solely own, the doctor-patient relationship.

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Sources: Fed up with rising costs, big U.S. firms dig into healthcare | Caroline Humer | www.reuters. com/article/us-usa-healthcare-employersinsight/fed-up-with-rising-costs-big-u-s-firmsdig-into-healthcare-idUSKBN1J70ZZ Amazon-Berkshire-JPMorgan Health Venture Takes Aim at Middlemen | Zachary Tracer| www.bloomberg.com/news/ articles/2018-06-24/amazon-berkshirejpmorgan-health-venture-takes-aim-atmiddlemen Five ways the Amazon / Berkshire Hathaway / JPMorgan Chase deal could change healthcare in the U.S | http://us.milliman.com/

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Five-ways-the-Amazon-Berkshire-HathawayJPMorgan-Chase-deal-could-changehealthcare-in-the-US/ Employer Health Insurance: Often-Hated, Sometimes Pioneering, and Now on Amazonâ&#x20AC;&#x2122;s Radar | Margot Sanger-Katz | www.nytimes. com/2018/02/01/upshot/employer-healthinsurance-amazon-berkshire-hathaway.html As Amazon Turns Its Gaze to Healthcare, the Industry May Be in for a Wild Ride | jrreport.wordandbrown.com/2018/10/23/ as-amazon-turns-its-gaze-to-healthcare-theindustry-may-be-in-for-a-wild-ride/

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CVS & AETNA The Ultimate Non-Acute Care Model

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

" October 26, 2017, CVS Health CEO, Larry Merlo, announces they have entered into “a definitive merger agreement to acquire Aetna, for a purchase price of approximately $69 billion. With the assumption of Aetna debt, the total transaction value is $77 billion” —CVS Health/Aetna Investor Call Script

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In announcing their intent to merge, the joint CVS-Aetna venture aims to remake the consumer health care experience. The strategic rationale outlined by these two companies on the Investor Relations portion of CVS Healthâ&#x20AC;&#x2122;s website captures three key areas of value creation sought by the merge: 1. C onsumers will benefit from a uniquely integrated, community-based health care experience, helping them better navigate the system to achieve their best health.

2 Concerns of the growing cost of treating chronic conditions are addressed through broader use of data and analytics, leading to improved patient health at substantially lower cost.

3. Promotion of lower cost sites of care and helping to avoid costly hospital readmissions will reduce wasteful spending.

Combined, the above initiatives underscore the merged entityâ&#x20AC;&#x2122;s goal of generating consumer savings through reduced hospital use.

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Larry Merlo, CVS Health CEO, “Together we plan to build an entirely new health care concept based on the principles of making care easier to use and more affordable while offering consumers the ability to interact with trusted and familiar health care experts in their communities across the country.”

—CVS Health/Aetna Investor Call Script One could argue that the merger of a pharmacy benefit management (PBM) company like CVS with a medical benefit management company like Aetna is just a natural return to a unified total cost management paradigm that existed prior to the emergence of independent PBMs a few decades ago. The move is actually a reaction to the shift in health care demand to chronic care and associated ongoing medication management. The shift in demand is driven by the global demographic wave of elderly people resulting from the synchronized aging of the baby-boom generation, born in the decades immediately after World War II (generally regarded as 1946-1964), and the near doubling of life expectancy from the year 1900 to the year 2000. Together with the explosion in the breadth and complexity of our collective pharmacopeia, the economic opportunity in managing drug cost and using drug management techniques to control the total cost of healthcare is compelling.

What is critically different in the CVS-Aetna alignment, for example an Express Scripts-Cigna combination or United Health’s OptumRx, is that CVS also delivers a national footprint of extremely low-cost sites of care that can be leveraged well beyond purchasing drugs and consumer goods. What’s more, these community-based pharmacies are among the most consumer friendly sites of care in terms of location, access, and familiarity. They also come with a conspicuous lack of the intimidating institutional air of a medical office, hospital, or specialty care establishment.

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Aetna, for its part, delivers insured lives, data analytics and comprehensive risk management. Their value is in their access to, and influence over, the total cost of care. Whatâ&#x20AC;&#x2122;s been largely missing from the dominant Third-Party Payor model is the direct provision of care in the most efficient and effective way. In the past, the Payorsâ&#x20AC;&#x2122; incentive and mode of operation was to design methods to reduce and delay utilization of care, choose the lowest cost provider of care, negotiate lower payment for care, or simply deny or delay paying for care, all from existing independent providers.

The move from the Aetna perspective is representative of a major national trend, which is a swing away from the original Blue Cross model of third-party reimbursement to the Kaiser Permanente model of a unified payor-provider. It remains to be seen whether, like Kaiser Permanente, the CVS-Aetna enterprise also develops its own hospitals and ambulatory surgery facilities for procedure-based care in markets where they have achieved a sufficient concentration of subscribers.

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About CVS Health Corporation

CVS Health Corporation, together with its subsidiaries, provides integrated pharmacy health care services. It operates through Pharmacy Services and Retail/LTC segments. The Pharmacy Services segment offers pharmacy benefit management solutions, such as plan design and administration, formulary management, Medicare Part D services, mail order, specialty pharmacy and infusion services, retail pharmacy network management services, prescription management systems, clinical services, disease management programs, and medical pharmacy management services. This segment serves employers, insurance companies, unions, government employee groups, health plans, Medicare Part D plans, managed Medicaid plans, plans offered on public and private exchanges, other sponsors of health benefit plans, and individuals under the CVS Caremark Pharmacy Services, Caremark, CVS Specialty, AccordantCare, SilverScript, Wellpartner, NovoLogix, Coram, Navarro Health Services, and ACS Pharmacy names. As of December 31, 2017, it had 23 retail specialty pharmacy stores, 18 specialty mail

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order pharmacies and 4 mail order dispensing pharmacies, and 83 branches for infusion and enteral services. The Retail/LTC segment sells prescription drugs, over-the-counter drugs, beauty products and cosmetics, personal care products, convenience foods, seasonal merchandise, and greeting cards, as well as offers photo finishing services. It has 9,803 retail stores in 49 states, the District of Columbia, Puerto Rico, and Brazil primarily under the CVS Pharmacy, CVS, CVS Pharmacy y mรกs, Longs Drugs, Navarro Discount Pharmacy, and Drogaria Onofre names; online retail pharmacy Websites; and 37 onsite pharmacy stores, long-term care pharmacy operations, and retail health care clinics. The company was formerly known as CVS Caremark Corporation and changed its name to CVS Health Corporation in September 2014. CVS Health Corporation was founded in 1892 and is headquartered in Woonsocket, Rhode Island.

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About Aetna Inc.

Aetna Inc. operates as a health care benefits company in the United States.

It operates through three segments: Health Care, Group Insurance, and Large Case Pensions. The Health Care segment offers medical, pharmacy benefit management service, dental, behavioral health, and vision plans on an insured and employer-funded basis. It also provides point-of-service, preferred provider organization, health maintenance organization, and indemnity benefit plans, as well as health savings accounts and consumerdirected health plans. In addition, this segment offers Medicare and Medicaid products and services, as well as other medical products, such as medical management and data analytics services, medical stop loss insurance, workers’ compensation administrative services, and products that provide access to its provider networks in select geographies. The Group Insurance

segment offers life insurance products, including group term life insurance, voluntary spouse and dependent term life insurance, group universal life insurance, and accidental death and dismemberment insurance; disability insurance products; and long-term care insurance products, which provide the benefits to cover the cost of care in private home settings, adult day care, assisted living, or nursing facilities. The Large Case Pensions segment manages various retirement products comprising pension and annuity products primarily for tax-qualified pension plans.

The company provides its products and services to employer groups, individuals, college students, part-time and hourly workers, health plans, health care providers, governmental units, government-sponsored plans, labor groups, and expatriates. Aetna Inc. was founded in 1853 and is based in Hartford, Connecticut.

Sources: “CVS Health + Aetna: Revolutionizing the Consumer Health Care Experience.” CVS Health. http://investors.cvshealth.com/~/media/Files/C/CVS-IR-v3/AET%20transaction/CVSAetna%20Investor%20Presentation.pdf “Company Overview of CVS Health Corporation.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/snapshot.asp?privcapId=93625.

“Company Overview of Aetna Inc.” Bloomberg.com, Bloomberg, www.bloomberg.com/ research/stocks/private/snapshot.asp?privcapId=655542.

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GOOGLEâ&#x20AC;&#x2122;S NEST AND VERILY Sensors, Science & Search

BY PAUL J. TIRJAN, MBA

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With a growing number of high-profile hires, partnerships, and acquisitions, Google has been signaling to the health care industry its intentions to enter the market. Through subsidiary companies, Nest and Verily Life Sciences, Google aims to transform care management and disrupt the health insurance market by bringing a data-driven approach to identify best possible patient-centric health strategies. Given the variety of sensors and other tools at Google’s disposable to collect vast amounts of patient data, Google is paving the way for a potential move by insurers to riskbased agreements with the company in an effort to cut costs. In the near future, it is reasonable to expect Google to use their deep reservoir of data to enable interventionist care and catalyze a shift toward lower cost care and healthier lives. “ Nest, a division of Google that sells home automation products, is exploring new products to help seniors live independently for as long as possible…Nest products can already be useful in elder care, for instance by letting family members check in on loved ones through its camera…” —Google Nest Talked to Senior Living Facilities, Interested in Aging (CNBC) But what does it really mean to the hospital-based health system when a tech giant like Google, that is so dominant in searching for information that its name has become the verb for online search, a household brand name synonymous with knowledge-of-all-things and blessed with effectively unlimited financial and technology resources, enters the realm of healthcare? Just how far do they plan to go? How soon? What does it mean for patients and network loyalty? Who will know the most about patients during all those moments between episodes of care when they are not actively engaged with the formal healthcare system?

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FOR STARTERS, WHAT IS THIS GOOGLE’S NEST?

Nest Labs, Inc. manufactures residential security systems. It offers thermostats; smoke and carbon monoxide alarms; and Nest Cam, a cloud-based video monitoring camera and cloud service. The company also provides Nest Weave communication protocol, which assists devices in talking directly to Nest products; Nest Cam application program interface (API) for connecting products to Nest Cam; Nest Hello, a doorbell, which includes high definition (HD) video, day and night; Nest X Yale, a secure lock connected

by Nest App that enables customers to lock and unlock doors from anywhere; and works with Nest Store, an online catalog of its products. The company offers its products through retail locations, professional distributors, and through an online store. The company was founded in 2010 and is based in Palo Alto, California. Nest Labs, Inc. operates as a subsidiary of Alphabet Inc. —Bloomberg Ok, so home automation and IoT communication is where they started, but where are they now and where are they headed?

September 19, 2018 —Geekwire breaks news that Nest is acquiring Senosis, a health monitoring startup.

Senosis Health is a healthcare startup based out of the University of Washington—Seattle. The company focuses on smartphone-based health monitoring systems. Their primary goal is to turn smartphones into monitoring devices that collect health metrics to diagnose pulmonary function, hemoglobin counts and other critical health information. —Geekwire It might sound like Google is preparing a direct-to-consumer toolkit, but there is more to the story…

Verily Life Sciences LLC operates as a life sciences research and engineering organization. The company develops tools and platforms to collect and organize health data for holistic

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care management. The company also offers Liftware Steady, a computerized stabilizing handle and a selection of similar utensil attachments that are designed to counteract the effects of hand tremors; and Liftware Level, which helps individuals with limited hand and arm mobility to hold a utensil at the angle needed to feed themselves. The company develops tools for various projects, such as sensors, interventions, health platforms and population health tools, and precision medicine. It serves life sciences, medical device, and government organizations. Verily Life Sciences LLC has a strategic alliance with Sensile Medical Ltd. The company was formerly known as Google Life Sciences and changed its name to Verily Life Sciences LLC in December 2015. The company is based in South San Francisco, California. Verily Life Sciences LLC operates as a subsidiary of Alphabet Inc. —Bloomberg “ A classic intervention might involve analyzing health data to figure out which patients would benefit most from having a nurse visit them at home so they don’t end up in the emergency room, or figuring out whether patients are filling their medication scripts after getting discharged from the hospital…

This opportunity represents about $20 billion to $25 billion in annual spending today with huge potential upside of up to $1 trillion as more insurers move to these kind of risk-based agreements” —Ari Gottlieb (PricewaterhouseCoopers), CNBC, Alphabet’s Verily unit planning insurance move “ A data-driven approach, like the solution Verily brings, will enable more tailored insurance products to better meet individual needs. As a sister-company to Google, Verily will have access to enormous amounts of very granular data that it can use to improve customer service. If Verily can also figure out how to reach users as patients, it could use data to enable interventionist care, which will ultimately lead to lower cost of care and healthier lives” —Aimee Sziklai (Healthcare business leader and vice president, Capgemini), Google’s SisterCompany Verily’s Health Insurance Plot is Good News

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Google has also publicly made its intentions clear to apply their considerable capabilities in automation and machine learning to the healthcare sector. There are likely many AI projects running wholly or in part under a cloak of stealth mode operations as well.

Let’s recap the case for Google as a potential player in healthcare: • Market cap approximately $750 billion

That’s approximately 3x United Healthcare / 3x Pfizer / 5x CVS Aetna / 15x HCA • Balance sheet with well over $100 billion in net assets

Effectively unlimited research budget potential • Seven products with more than 1 billion users each

Gmail, Android, Chrome, Maps, Search, YouTube and Google Play • Mountains of information with an unprecedented agglomeration of data regarding humans • Masters of research, innovation and engineering

Taken as a whole, Google has sufficient skills, assets and momentum to effect substantial change across the healthcare industry and has expressed their intent to do so. While it is still unlikely Google will deliberately enter the hospital or surgery sectors directly, they may seek to have sway over risk management, provider selection, and direct patient care in chronic disease, prevention, prediction, primary care, diagnostics and urgent care.

What’s at stake then, is the primacy of the hospital-based health system provider over the patient relationship and the way their patients engage in their own health and wellbeing.

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Sources

Farr, Christina, and Jillian D'Onfro.

“Google Is Mulling a New Market for Nest Smart Home Products: Seniors.”

CNBC, CNBC, 19 Sept. 2018, www. cnbc.com/2018/07/20/google-nestsenior-living-aging.html.

“Company Overview of Nest Labs, Inc. .” Bloomberg.com, Bloomberg, www.bloomberg.com/ research/stocks/private/snapshot. asp?privcapId=142508766.

Levy, Nat, and Todd Bishop. “Nest's Digital Health Ambitions Revealed in Records from Secretive Purchase of Seattle Startup Senosis.” GeekWire, 20 Sept. 2018, www.geekwire.com/2018/ nests-digital-health-ambitionsrevealed-records-secretive-purchaseseattle-startup-senosis/.

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“Company Overview of Verily Life Sciences LLC.” Bloomberg.com, Bloomberg, www.bloomberg.com/ research/stocks/private/snapshot. asp?privcapId=319032219.

Farr, Christina. “Alphabet's Verily Is Plotting a Move into a Fast-Growing Corner of the Health Insurance Industry.” CNBC, CNBC, 27 Feb. 2018, www.cnbc.com/2018/02/27/ alphabet-verily-health-insurance-caremanagement.html.

Moorcraft, Bethan. “Google SisterCompany Verily's Health Insurance Plot Is 'Good News'.” Insurance Business, www.insurancebusinessmag. com/us/news/healthcare/googlesistercompany-verilys-health-insuranceplot-is-good-news-94746.aspx.

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COX COMMUNICATION AND TRAPOLLO Cable Companies Move To Own The Home Health Environment

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

“ Cox Communications, Inc. operates as a broadband communications and entertainment company for residences and businesses in the United States. It provides digital video, Internet, telephone, and home security and automation services over its IP network. The company offers voice, video, and data solutions for commercial customers; national and local cable spot and new media advertising; and Converge, storytelling platform to inform, inspire, and connect people to what they love with a focus on technology, entertainment, and the communities where they live and work. It serves K-12 education, hospitality, and healthcare industries. The company was founded in 1984 and is based in Atlanta, Georgia. Cox Communications, Inc. operates as a subsidiary of Cox Enterprises, Inc.” —Bloomberg 76

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Cox Communications is building capabilities to corner the home health market. With a focus on senior assisted living and chronic care management, Cox has teamed up with the Cleveland Clinic and acquired Trapollo, to bolster its telemedicine capabilities. Cox has an unparalleled ability to engage consumers in their home.

These strategic partnerships with telemedicine companies are simply a way to leverage their existing assets to foster growth in another market primed for change.

TIMELINE / TRANSACTION(S):

February 19, 2015 | Cox Communications and Cleveland Clinic

announce formation of Vivre Health April 19, 2015 | Cox Communication invests in Rimidi, a digital

health company focused on diabetes and other chronic conditions September 10, 2015 | Cox Communications acquires Trapollo,

undisclosed amount

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“ We believe that the home will be an increasingly important node within the healthcare delivery architecture…The Trapollo acquisition allows us to play a more strategic role in the deployment of healthcare technologies in the homes of patients across the country” —Asheesh Saksena, Executive VP and Chief Strategy Officer, Cox Communications, “Cox Acquires Trapollo, Enters Home Connected Health” Trapollo LLC designs, delivers, and manages a remote health monitoring system for chronic illness. It offers Trapollo Management Console, a software platform that helps to manage various aspects of a remote health monitoring program. The company’s platform is for various applications in the areas of program design, program management, inventory and asset management, patient outreach, technical support, device logistics, monitoring, and data analytics. The company is based in Sterling, Virginia. As of September 10, 2015, Trapollo LLC operates as a subsidiary of Cox Communications, Inc. —Bloomberg “ Smart home technology can help families avoid the wrenching decision and the expense of moving an aging parent to an assisted living facility…A connected home ensures seniors can continue their daily routine while maintaining—and even enhancing—their quality of life in their own home” —Ryland Madison, director of product marketing, Cox Communications, Cox Communications Creates Seniors’ Smart Home of the Future The competitive advantage of a hardwired digital pipeline provider in healthcare: “ The biggest issue facing digital health platforms is the lack of engagement. When it comes to hospital-specific patient portals, adoption rates have historically been low, hovering between 10% and 15%. That’s something media companies

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may be equipped to change” —Dan D’Orazio (CEO Sage Growth Partners, a health-care research firm), Big Media Companies are Branching into Health Care. Here’s Why (MarketWatch) “ A strategy and consumer survey found that the same percentage of consumers (about 40%) trust large retailers and digitally enabled companies as healthcare providers to help manage their health. Underneath this statistic is consumers’ belief that they can “trust to receive quality care at lowest cost.” That trust is grounded in transparency, the kind health consumers—consumers—find in retail and eCommerce shopping formats” —What Retail Telemedicine Means for Healthcare Providers (Physicians News Network) Identifying accessibility to healthcare and the aging population as factors vulnerable to innovation, Cox hopes to pair their recognized brand and reach with telemedicine solutions to reshape the fragmented landscape of healthcare.

Sources: “Company Overview of Cox Communications, Inc.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/ snapshot.asp?privcapId=337605.

“Cox Communications And Cleveland Clinic Form Alliance To Take Healthcare To The Home.” Newsroom | About Us | Cox Communications, 19 Feb. 2015, newsroom. cox.com/2015-02-19-Cox-CommunicationsAnd-Cleveland-Clinic-Form-Alliance-To-TakeHealthcare-To-The-Home.

Cox Enterprises. “Cox Enterprises Invests In Digital Health Company Rimidi.” PR Newswire: Press Release Distribution, Targeting, Monitoring and Marketing, 29 Apr. 2015, www.prnewswire.com/news-releases/coxenterprises-invests-in-digital-health-companyrimidi-300073968.html.

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“Cox Acquires Trapollo, Enters Home Connected Health” Newsroom | About Us | Cox Communications, 10 Sep. 2015, http:// newsroom.cox.com/2015-09-10-CoxAcquires-Trapollo-Enters-Home-ConnectedHealth

Toy, Sarah. “Big Media Companies Are Branching into Health Care. Here's Why.” MarketWatch, MarketWatch, 18 Aug. 2018, www.marketwatch.com/story/why-yourcable-company-may-soon-provide-yourhealth-care-2018-08-16.

“Company Overview of Trapollo LLC .”

Bloomberg.com, Bloomberg, www.bloomberg. com/research/stocks/private/snapshot. asp?privcapId=311180567.

“What Retail Telemedicine Means for Healthcare Providers.” Physicians News Network, 7 Oct. 2015, www. physiciansnewsnetwork.com/telehealth/ article_127a01f8-6d16-11e5-accd5f95a2d9d6a4.html.

Ecker, Elizabeth. “Cox Communications Creates Seniors' Smart Home of the Future.”

Senior Housing News, Senior Housing News, 3 Dec. 2017, seniorhousingnews. com/2017/12/03/cox-communicationscreates-seniors-smart-home-future/.

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GENERALI AND CARELINX Travel Insurer Buys Into “Uber” For Homecare

BY PAUL J. TIRJAN, MBA

Ability To Choose A Nurse

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

Ability To Create A Care Plan

Message Team

(And Monitor Tasks Completed Or Due)

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September 25, 2017—Generali Global Assistance acquires CareLinx for undisclosed amount.

Generali Global Assistance, the assistance arm of the world's 3rd largest insurer, Generali Group, has its eyes set on elderly assistance. Identifying lower cost environments as the future of senior care, Generali’s acquisition perfectly positions them to deliver in-home care solutions to seniors. Pairing CareLinx marketplace of 200,000 tech-enabled caregivers with their vast remote clinical support infrastructure, Generali is initiating the shift of healthcare out of the hospital and into the home.

Assicurazioni Generali S.p.A. provides various insurance solutions in Europe, the Middle East, Africa, Asia, the Americas, and internationally. It operates through three segments: Life; Non Life; and Holding and Other Business. The company offers saving and protection insurance products for individuals and family, as well as for businesses; unit linked products with investment purposes; and motor, liability, casualty, accident, health, and commercial and industrial risks insurance products, as well as asset management and banking services. It also provides investment and wealth management services. The company was formerly known as Assicurazioni Generali Austro-Italiche and changed its name to Assicurazioni Generali S.p.A. in 1848. Assicurazioni Generali S.p.A. was founded in 1831 and is headquartered in Trieste, Italy.

—Bloomberg CareLinx Incorporated operates an online platform that enables families to find and manage caregivers. The company’s network of home care professionals includes part-time visiting nurses, home care professionals, live-in caregivers, companion care, and in-home help for seniors and the elderly. It serves customers in Atlanta, Georgia; Austin, El Paso, Fort Worth, Houston, San Antonio, and Dallas, Texas; Boston, Massachusetts; Charlotte, North Carolina; Chicago, Illinois; Denver, Colorado; Detroit, Michigan; Indianapolis, Indiana; Jacksonville, Florida; Los Angeles,

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San Diego, San Jose, and San Francisco, California; Memphis, Tennessee; New York, New York; Philadelphia, Pennsylvania; Phoenix, Arizona; Seattle, Washington; and Washington, D.C. CareLinx Incorporated has a strategic partnership Lacuna Health.

The company was founded in 2011 and is based in San Bruno, California. —Bloomberg Essentially, CareLinx provides an app based service where a patient can shop for a specific homecare worker based on a worker profile, credentials, skills, experience, photo, and availability. The aspect that is reminiscent of Uber and Lyft, is that you have an actual hourly rate quote from the exact worker, which is inclusive of the fee for CareLinx , so you can order that specific worker for the exact time slot you want them, and then actually pay for the service through the app. Naturally you can rate the worker as you pay.

Some quotes from management of Generali / CareLinx for contemplation: “ As the senior population continues to rise, both families and health systems are faced with the dilemma of how to provide an adequate level of quality, but affordable care. CareLinx shares our mission of improving lives through services that can lessen the impacts of life’s most stressful periods and by providing them with the necessary resources to rapidly expand their market share, we believe we will help them positively affect change to senior care services in the United States” —Chris Carnicelli, CEO Generali Global Assistance, Generali Global Assistance Acquires CareLinx, A Leader in National In-Home Care Solutions

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“ Generali Global Assistance plans to combine this tech-enabled, nationwide network of non-clinical in-home caregivers with its existing remote clinical support capabilities to offer a wide spectrum of post-acute assistance services. Generali Global Assistance’s remote support center currently provides 24/7 nurse and doctor-supported telephonic medical assistance and navigation, soon to be leveraged by CareLinx customers and partners” — ­ Generali Global Assistance Acquires CareLinx, A Leader in National In-Home Care Solutions “ We are absolutely thrilled to join Generali Global Assistance and with our massive collection of resources and prior success with large national health systems, accountable care organizations, and insurance companies, we are ready to dramatically transform healthcare delivery in the U.S. and empower millions of seniors to age gracefully at home” —Sherwin Sheik, CEO CareLinx, Generali Global Assistance Acquires CareLinx, A Leader in National In-Home Care Solutions “ The main takeaway here is Generali and CareLinx really believe that more and more of healthcare delivery is going to be transitioning from the facility-based, inpatient setting to— given physician shortages not just in the US but globally—to a lot more healthcare [being] delivered into the home,…Really what we’re doing with the backing of Generali is building that ability for insurance companies and providers to extend beyond the facility walls and really provide healthcare into the home, which they currently can’t do” ­—Sherwin Sheik, CEO CareLinx, Caregiver startup CareLinx acquired by Generali Global Assistance (MobiHealth News)

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“ I believe that IPMI (International Private Medical Insurance) will be the only feasible model for health insurance…The other important element is that traditionally, insurers have been seen as “payers.” But that is not health insurance, it is sickness insurance. That model must evolve. I want to see GGH become a true health partner, actively contributing to the health and well-being of a population. It is much more socially responsible—not to mention cost-effective—to ensure that the population stays healthy rather than just paying the claim when the insured gets sick. I think this is one of the biggest challenges for the health insurance industry at large” — ­ Marco Giacomelli, CEO Generali Global Health, An Interview With Generali Global Health’s Marco Giacomelli (Global Benefits Vision) There are many intriguing aspects to this development.

First of all, since when do 200 year old European insurance companies enter the U.S. healthcare sector? Granted, Generali may be the largest company you have never heard of, but with the financial resources of the global number 3 spot among insurers, as well as a likely the number 1 spot among telemedicine and remote medical support providers, they have extraordinary advantages for a newbie.

Second, Generali is entering the field from the technology enabled elderly homecare segment rather than a traditional hospital or physician or pharmacy or insurance or ambulatory procedure strategy. Clearly, this is not by accident or inability because Generali has immense experience with, and exposure to, all aspects of healthcare in other markets. The Generali move is a carefully contemplated smart-money move into the future of healthcare in the U.S. from the vantage of an impartial objective outsider, who are speaking with their wallet.

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Third, there is an element of irony in having one of the largest insurance companies in the world bypassing the third party payment system in the U.S. and focusing on direct to consumer healthcare.

Possibly the most interesting element to this story is what it might foretell about other non-domestic entrants into the largest healthcare services market in history. What other global giants might throw their hat in the ring? Will they bring a technology solution? Or buy one?

Who will own the healthcare consumer relationship? Who will control referral, navigation and utilization of the formal healthcare system?

Hospital based health systems? Health insurance companies? Or maybe consumer driven service companies? There are of plenty of home grown tech companies betting on the latter, but the Generali story is a reminder that the biggest disruptor tomorrow may not even appear on your radar today.

Sources: Generali Global Assistance. “Generali Global Assistance Acquires CareLinx, A Leader In National In-Home Care Solutions.”

PR Newswire: Press Release Distribution, Targeting, Monitoring and Marketing, 25 Sept. 2017, www.prnewswire.com/newsreleases/generali-global-assistance-acquirescarelinx-a-leader-in-national-in-home-caresolutions-300524535.html.

“Company Overview of Assicurazioni Generali S.p.A.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/ snapshot.asp?privcapId=723344.

Comstock , Jonah. “Caregiver Startup CareLinx Acquired by Generali Global Assistance.”

MobiHealthNews, 26 Sept. 2017, www. mobihealthnews.com/content/caregiverstartup-carelinx-acquired-generali-globalassistance.

“An Interview with Generali Global Health's Marco Giacomelli – Global Benefits Vision.”

Global Benefits Vision, 18 June 2017, www. global-benefits-vision.com/an-interview-withgenerali-global-healths-marco-giacomelli/.

“Company Overview of CareLinx Incorporated.” Bloomberg.com, Bloomberg, www.bloomberg.com/research/stocks/ private/snapshot.asp?privcapid=184226151.

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UNITEDHEALTH: OPTUM Payor, Provider Or Data Company?

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

Optum’s strategy of meeting patients where they are and deploying more ambulatory, preventive care services works in concert with its sister company UnitedHealthcare’s goal of reducing high-cost, unnecessary care services, when applicable. If Optum succeeds in creating healthier populations that use lower levels of care more often, that benefits the parent company UnitedHealth Group as UnitedHealthcare spends less money and time on claims processing/payout.

—Optum a Step Ahead in Vertical Integration Frenzy

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“ OptumCare has grown from a single medical practice serving 350,000 people and one payer to an emerging national ambulatory care delivery platform, focused on high value care and exceptional consumer satisfaction, serving more than 80 payers and 15 million individuals” — Larry Renfro, Optum CEO, Buying Binge For UnitedHealth’s Optum Is Only Just Beginning “ By having physicians, clinical laboratories, outpatient surgery centers, and urgent care centers within their own networks, insurance providers then can steer patients toward the lowestcost options within their networks and away from more expensive hospitals.”

— UnitedHealth’s Optum to Be Largest Employer of Doctors in US

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The operative word here is STEER. UnitedHealthâ&#x20AC;&#x2122;s Optum has been on an acquisition spree the past few years to solidify its place as the leader in integrated health services. With a footprint in everything from surgical care to pharmacy benefit management, physician practices and health consulting services, there is no clearly defined objective for Optum other than to consolidate all healthcare services under one umbrella and reduce the use of high-cost sites of care such as hospitals or unnecessary care at any site. In essence, their strategy commoditizes and isolates hospitals, relegating them to trauma, extreme high-acuity surgery (e.g. - open heart, brain and transplants) and intensive care by eliminating every other need for in-patient care.

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UnitedHealth Group Inc.

UnitedHealth Group Incorporated operates as a diversified health care company in the United States.

It operates through four segments: UnitedHealthcare, OptumHealth, OptumInsight, and OptumRx. The UnitedHealthcare segment offers consumer-oriented health benefit plans and services for national employers, public sector employers, mid-sized employers, small businesses, and individuals; health care coverage, and health and well-being services to individuals age 50 and older, addressing their needs for preventive and acute health care services, as well as services dealing with chronic disease and other specialized issues for older individuals; and Medicaid plans, Childrenâ&#x20AC;&#x2122;s Health Insurance Program, and health care programs; and health and dental benefits. The OptumHealth segment provides access to networks of care provider specialists, health management services, care delivery, consumer engagement, and financial services. This segment serves individuals through programs offered by employers, payers, government entities, and directly with the care delivery systems. The OptumInsight segment offers software

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and information products, advisory consulting arrangements, and services outsourcing contracts to hospital systems, physicians, health plans, governments, life sciences companies, and other organizations. The OptumRx segment provides pharmacy care services and programs, including retail network contracting, home delivery and specialty pharmacy, and purchasing and clinical, as well as develops programs in areas, such as step therapy, formulary management, drug adherence, and disease/drug therapy management. UnitedHealth Group Incorporated was founded in 1974 and is based in Minnetonka, Minnesota. â&#x20AC;&#x201D;Bloomberg

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Optum, Inc

Optum, Inc. offers healthcare services.

The company offers data and analytics; pharmacy care services; population health management including behavioral health, care and clinical management, claims editing services, and population analytics and consulting; health care delivery services; health care operations; biometric solutions; advocatory support services; actuarial consulting; and advisory services. It also offers solutions to life science companies to identify markets, develop evidences,

differentiate products, and realize the potential and retention. The company serves government, health planners, pharmacies, care providers and health systems, hospitals, doctors, individual and families, and life science companies. Optum, Inc. was founded in 2009 and is based in Eden Prairie, Minnesota. The company also has operations in North America, South America, Europe, Asia Pacific, and the Middle East. Optum, Inc. operates as a subsidiary of United HealthCare Services, Inc. â&#x20AC;&#x201D;Bloomberg

Timeline / Transactions: 2014 February 19 Optum purchases majority stake in Audax Health Solutions 6

2015

2017

April 8 Optum acquires MedExpress7

January 9 Optum acquires Surgical Care Affiliates9

July 23 Catamaran, a PBM, joins OptumRX8

August 29 Optum announces plans to acquire the Advisory Board Companyâ&#x20AC;&#x2122;s healthcare business10 December 6 Optum announces plans to acquire DaVita Medical Group11

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Sources: 1. B yers, Jeff. “Optum a Step Ahead in Vertical Integration Frenzy.” Healthcare Dive, Healthcare Dive, 12 Apr. 2018, www.healthcaredive.com/news/ optum-unitedhealth-vertical-integrationwalmart/520410/.

2. Japsen, Bruce. “Buying Binge For UnitedHealth's Optum Is Only Just Beginning.” Forbes, Forbes Magazine, 18 Apr. 2018, www.forbes.com/sites/ brucejapsen/2018/04/18/the-buyingbinge-of-unitedhealths-optum-is-only-justbeginning/#1e4e8666192d.

3. S tone, Jon. “UnitedHealth Group Soon to Be Largest Employer of Doctors in the US; Clinical Laboratory Outreach More Critical than Ever Before.” Dark Daily, Dark Daily, 29 June 2018, www.darkdaily.com/ unitedhealth-group- 1 4. “Optum Acquires Majority Interest in Audax Health Solutions.” UnitedHealth Group, 19 Feb. 2014, www.unitedhealthgroup.com/ newsroom/2014/0219optumacquiresaudax. html. Optum Acquires Majority Interest in Audax Health Solutions.” UnitedHealth Group, 19 Feb. 2014, www. unitedhealthgroup.com/newsroom/ 2014/0219optumacquiresaudax.html.

5. “ Optum and MedExpress Join to Serve Consumer Health Care Needs.” Optum Centers of Excellence Program Expands Access to Mayo Clinic Services, 8 Apr. 2015, www.optum.com/about/news/optummedexpress-join-serve-consumer-healthcare-needs.html.

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6. “ OptumRx, Catamaran Complete Combination.” Optum, Optum, 23 July 2015, www.optum.com/about/news/optumrxcatamaran-complete-combination.html.

7. “Surgical Care Affiliates (SCA), OptumCare to Combine.” UnitedHealth Group, UnitedHealth Group, 9 Jan. 2017, www.unitedhealthgroup. com/newsroom/2017/0109scaoptumcare. html.

8. “ Optum and The Advisory Board Company's Health Care Business to Combine.” Optum, Optum, 29 Aug. 2017, www.optum.com/ about/news/optum-the-advisory-boardcompany-health-care-business-combine.html.

9. “ DaVita Medical Group to Join Optum.”

Optum, 6 Dec. 2017, www.optum.com/ about/news/davita-medical-group-to-joinoptum.html.

10. C ompany Overview of UnitedHealth Group Incorporated.” Bloomberg.com, Bloomberg, www.bloomberg.com/research/stocks/ private/snapshot.asp?privcapId=104673.

11. C ompany Overview of Optum, Inc.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/ snapshot.asp?privcapId=141274824. soon-to-be-largest-employer-of-doctors-inthe-us-clinical-laboratory-outreach-morecritical-than-ever-before-629/.

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AMAZON’S PILLPACK Is It About The Licenses?

Or Controlling The Chronic Care Patient Relationship?

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

June 28, 2018—Amazon acquires PillPack for $1 billion We all know Amazon… “ Amazon.com, Inc. engages in the retail sale of consumer products and subscriptions in North America and internationally.

The company operates through three segments: North America, International, and Amazon Web Services (AWS) segments. It sells merchandise and content purchased for resale from vendors, as well as those offered by third-party sellers through physical stores and retail Websites.” —Bloomberg

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BUT WHO IS PILLPACK?

“ PillPack, Inc. operates as a pharmacy that sorts medication by dose and delivers to the customer’s door. The company receives prescriptions from doctors and packs medicines as per the prescription and dosage, and delivers it in a dispenser containing PillPack packets. It offers vitamins and OTCs, inhalers, cream tubes, testing supplies, and other pharmacy items. It serves healthcare providers, caregivers, and customer service and travel clients in the United States. PillPack, Inc. was incorporated in 2013 and is based in Manchester, New Hampshire. As of September 21, 2018, PillPack, Inc. operates as a subsidiary of Amazon.com, Inc.” — ­ Bloomberg In other words, PillPack takes all of the medications a patient is prescribed and sorts the specific pills according to the various times of day and dosage, much the way patients with many medications do now with a weekly pill organizer marked with a specific day of the week and a.m. or p.m. The difference is that the patient doesn’t need to fill their dispenser, which is obviously more convenient, but

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also significantly reduces errors for elderly or cognitively impaired patients or patients with just too many meds to keep straight. Every pouch is labelled with the patient’s name and exact day and time they are to take the packet of pills. Instead of receiving a variety of pill bottles that need to be sorted, the patient receives a strip of pill pouches in the mail that are ready to use. Given the all-toocommon phenomena of unnecessary readmission to hospital or avoidable trips to the emergency department resulting from nonadherence to medication, simplifying the medication management with automation such as PillPack could greatly reduce the labor and complications associated with long term management of patients with multiple chronic conditions. “ The service is currently available in every U.S. state, except Hawaii. The deal will let Amazon ship prescriptions overnight in a direct threat to the $400 billion U.S. pharmacy industry” —Here’s the reason why Amazon is diving into health care (CBS News) “ With all the licenses and logistics pieces in place, Amazon could effectively operate an outsourced fulfillment system for drug companies similar to FBA, and could handle all of the tracking requirements that the DSCSA demands” —Amazon in Healthcare: The E-Commerce Giant’s Strategy for a $3 Trillion Market (CBInsights) Note: DSCSA is the Drug Supply Chain Security Act & FBA is Fulfillment by Amazon “ Amazon has one of the most advanced fulfillment networks in the world. With Fulfillment by Amazon (FBA), you store your products in Amazon's fulfillment centers, and we pick, pack, ship, and provide customer service for these products. FBA can help you scale your business and reach more customers.”

—Amazon web site at services.amazon.com

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“ Amazon could do even more by cutting down on the 20 to 30 percent of prescriptions that are reportedly never filled, easing communications between doctors and patients, and helping the medical community collect useful data on side effects and customer satisfaction” —An Amazon Pharmacy Could Save Lives and Eliminate a Lot of Waste (Bloomberg) While the bulk of the media attention has been focused on the market access and acceleration of Amazon’s entry into the pharmacy business, and the acquisition does immediately give Amazon a built out pharmacy supply chain and pharmacy license in 49 states, the bigger long term story is in the battle for the relationship with the healthcare consumer. Amazon’s value proposition of convenient online shopping, customer care and purchasing experience makes PillPack a perfect fit for them. As a company that caters to people with multiple chronic conditions who benefit from drug sorting capabilities, PillPack enables Amazon to gain access to and influence over the chronic care patient relationship.

It would come as no surprise if Amazon complemented their newly acquired mail order pharmacy with existing infrastructure like newly acquired Whole Foods. If Amazon set up a retail pharmacy out of Whole Foods, acquired a wholesale pharmacy license, and secured a manufacturing license, they would be well positioned to operate an outsourced fulfillment system for drug companies that in time could obviate the need for generic drug companies, drug distribution companies, drug packaging companies, retail pharmacy chains, pharmacy benefit managers, specialty pharmacies and drug group purchasing organizations.

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Sources: LaVito, Angelica, and Lauren Hirsch. “Amazon Shakes up Drugstore Business with Deal to Buy Online Pharmacy PillPack.” CNBC, CNBC, 28 June 2018, www.cnbc.com/2018/06/28/ amazon-to-acquire-online-pharmacy-pillpack. html.

“Company Overview of Amazon.com, Inc.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/ snapshot.asp?privcapId=18749.

“Company Overview of PillPack, Inc.” Bloomberg.com, Bloomberg, www. bloomberg.com/research/stocks/private/ snapshot.asp?privcapId=229127718.

“Amazon In Healthcare: The E-Commerce Giant's Strategy For A $3 Trillion Market.” CB Insights Research, www.cbinsights.com/ research/report/amazon-transforminghealthcare/.

Flam, Faye. “What an Amazon Pharmacy Could Solve, and What It Won't.” Bloomberg.com, Bloomberg, 29 June 2018, www.bloomberg. com/view/articles/2018-06-29/an-amazonpharmacy-could-save-lives-and-eliminate-alot-of-waste.

Mirhaydari, Anthony. “Here's the Reason Why Amazon Is Diving into Health Care.” CBS News, CBS Interactive, 2 July 2018, www.cbsnews. com/news/why-amazon-is-diving-intohealthcare/.

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RAILROADS REPLACED

BY TRUCKS, A BRIEF HISTORY

BY MICHAEL HALE | Contributing author and editor, AllSpire Health Partners

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Only 100 years separated the Golden Spike of 1869 uniting a transcontinental railroad, and Neil Armstrongâ&#x20AC;&#x2122;s epic 1969 first step on the moon.

Within that span of time, the United States went from horses to canal boats to trains to trucks to planes. Each technology displaced its predecessor through cost savings or technology or some other means. It never was a real case of changing technology for its own sake, but rather a substitution to affect improvements in process, or in peopleâ&#x20AC;&#x2122;s lives.

The New United States of America was growing and expanding in the early 1800s. Horses and toll roads (turnpikes) brought freight to markets, and passengers to destinations, provided of course that the horses were changed every twelve miles.

Canals were expanded or created to dramatically increase the volume of freight, except in winter when some canals were not navigable. Rail wagons pulled by horses on rail tracks brought some efficiencies, but the limitations remained in the use of horse power.

In the 1820s, there were significant developments in Great Britain and the United States for steam powered engines. In 1828 the cornerstone was laid for construction of the Baltimore & Ohio railroad. This line was directly focused on competition with canal freight; Baltimore was in competition with New York and Philadelphia, particularly for trade from the West. Steam engines were new, and to some terrifying. Horses and canals were the rule.

Intercity roads were primitive.

The New York Central Railroad formed in 1854 by Erastus Corning.

It was not until the Civil War that there was the massive growth in railroad transportation that many sought.

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Railroads provided structured public transportation for passengers and goods. Private transportation whether by horseback, wagon, car or truck allowed individual choice in that transportation that was previously unknown. It was not always about efficiency but about choice. Railroad management were focused on what they recognized as competitors (other railroads), not disruptive replacements. They were occupied with the further development of their own infrastructure for the expansion of existing services. They didnâ&#x20AC;&#x2122;t see much of anything as competition, except each other.

Commerce stimulated business, but two world wars brought unimagined growth.

Even in 1916, railroad planners still saw the automobile as a passing fad. The railroads thought it preposterous that a few selfpropelled contraptions on the streets could ever become a serious threat to their long-held monopoly of transportation.

First challenge to the steam railroad in America was the electric interurban. The first practical system operated in Richmond, Virginia in 1888. Even with growth driven by World War I, the 1920s saw a marked decline of interurban systems. Four thousand miles of track were abandoned by 1929, with another 5000 miles by 1934.

By Pearl Harbor, less than 3000 miles remained. Some services remained south of Chicago by 1960.

The trend was from steam (or later diesel) railroad, to interurban, to truck or private automobile.

The Federal Government took over the operation of the railroads as of 28 Dec 1917, returning control to the railroads on March 1, 1920.

The competition of the Ford Model T and other automotive products made itself felt in the mid-twenties.

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The 1929 crash caused decreasing freight shipments and growth had fallen off. Passenger traffic had been decreasing. Smaller loads meant that there were more opportunities for trucks to show their efficiencies. Half-empty boxcars meant full trucks.

Still, there were substantial capital improvements to rail and rolling stock during the 1920s, with improvements taking effect in the 1930s. This was just before the outbreak of war in Europe with the Invasion of Poland in September 1939.

Ralph Budd, the President of the Burlington Railroad was called in and recommended to President Roosevelt that the railroads should remain under private control; coordination could be affected by the use of existing governing and coordinating bodies. His recommendations were implemented.

In comparing 1917 to 1942: 31% fewer locomotives, 24% fewer freight cars, 35% fewer passenger cars, and 27% less workers. But trains had heavier and more capable engines, pulling faster, and longer trains. These were now approaching equivalent capacity.

It is important to mention that World War II was a two front conflict permitting more effective East-West freight control.

At the same time, the trucking industry developed into a transportation and labor powerhouse. Railroads were saddled with a history of “featherbedding” and wholly inefficient work practices that strangled efficiencies, increased prices, and slowed transits.

The aging railroad industry was suffering from “toad in the pot syndrome” — it did not feel the water boiling.

The day-coach was vanishing, the pullman/sleeper cars were replaced by jetliners, and everything was changed by the convenience of the private car.

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Some things hastened the demise: removal of mail cars and increasing inefficiencies of high cost crews. Early advantages of vast distances, small towns and few dependable roads all gave way to modernization and growth. It was thought that customers would always automatically go to the train station. The thought of an average family getting into their own car was not even considered.

Railroad management looked for too long at the miles of track, powerful locomotives, office buildings, and station after station filled with passengers, not seeing the profound changes taking place right in front of them.

Sources: Stover, J. F. (1970). The life and decline of the American railroad. New York: Oxford University Press.

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THE FIRST PERSONAL COMPUTERS

BY MICHAEL HALE | Contributing author and editor, AllSpire Health Partners

Xerox was very, very successful at developing a working copier. The Model 914 revolutionized offices and document production. It also has a revolutionary sales model which used a per copy lease with a minimum monthly base. It was a money machine for a long time.

Expectations were that everything else would come as easily—they didn’t.

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The company that developed the first commercial personal computer was neither IBM, nor Apple, but Xerox. Xerox had a monumental success with their 914 copiers. Why Xerox didn’t have another success with their personal computer is what in hindsight is a both simple and thought-provoking story.

The Xerox 914 copier was introduced in the latter part of 1960 and was an instantaneous success. Sales were over $1.125 billion by 1968. Success brought its own measure of chaos. Administrative and financial systems were unable to cope with the orders, bills, and wheelbarrows of money. It was into this maelstrom that then CEO Peter McCoulough convinced founder Chairman Joe Wilson to bring in some outside talent and experience from what seemed like obvious choices: Ford, IBM, and General Motors. They were big companies—they would know…

Wilson and McCoulough also carefully considered diversification plans in three areas: medicine, education, and computers.

Information management was seen as a future focus. Acquisition

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overtures were made to Digital Equipment Corporation, and Scientific Data Systems (SDS) , a respected scientific computer firm.

Although negotiations first stalled, ultimately in a very surprising move, Xerox purchased SDS for $900 million, paying far more than its value by nearly any measure. The plan was to create an environment for creation, not just a business venue. Xerox then created what would ultimately become the legendary Palo Alto Research Center (PARC).

Diversification was an important topic with the looming challenges of IBM and Kodak. With a 95% market share, Xerox seemed almost invulnerable. Talk about diversification at first seemed unnecessary because there were almost endless opportunities available. The idea of genuine competition to their clearly superior technology made diversification redundant for at least the next decade.

Chester Carlson invented electrophotography and after many difficulties found interest though the Battelle Memorial Institute. Joe Wilson of the Haloid Company (a photographic supply company) immediately saw the possibilities of the primitive demonstration of the technology. Fast-forward fourteen difficult years and $75 million to eventually create a truly marketable product, the Model 914. Joe Wilson led Haloid/Xerox through that time keeping the focus on what was needed to make the change. Remarkably, competitorsâ&#x20AC;&#x2122; marketing and markets remained the same during that time, giving Xerox the unparalleled chance to learn, change, and improve.

In a stroke of marketing genius, they decided to lease the machines, and charge by the copy, not by the machine, ensuring a permanent revenue stream.

The faith that Joe Wilson maintained with Xerox/Haloid was in total contrast to Ford managementâ&#x20AC;&#x2122;s risk-averse accounting focus.

Opportunities were suffocated early on. Senior management did

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not encourage innovation for its own sake. Managers raised in this environment naturally behaved the same way. The Ford managers were successful if they minimized risk for a mature company, with existing and standardized processes. Entrepreneurship in a new startup has different needs and needs different management.

But by the time that Jack Goldman, now head of research at Xerox had left Ford, the automaker had become so averse to risk that nothing was moving ahead—they had no entrepreneurial spirit.

But Goldman went to McCoulough and got approval for a new research center.

The Xerox ALTO computer was first seen as an internal project that would be valuable in linking the ideas and actions of the disparate workforce of Xerox. It was not intended to be a commercial system; it was more of an experiment.

The target cost for the ALTO computer was $16,000, way beyond the $3,000 that was a realistic commercial price.

Finally, in 1979 when alternatives were moving quickly ahead, Xerox management decided against marketing the ALTO system.

Xerox now barely resembled the company that challenged IBM and Office of the Future. Competition, government antagonism and economic resistance were overwhelming.

But things were different. Implementation at Xerox demanded perfection while discouraging risk. Engineers were expected to design against a set of marketing and financial objectives that were constantly in flux and seemed beyond the technical reality. The solution to more complexity was to hire more engineers. But more people succeeded only in making the company less effective by disrupting collaboration and by breeding “NIH” not invented here.

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Finally, there were so many bright people at Xerox, especially in the corporate staff, that there was always someone who could shoot down an idea with solid arguments. Xerox staff felt that they had the “right of infinite appeal” — the staff just felt that they had the right, if not the obligation, to critique everything that was said or suggested.

In 1979, Steve Jobs paid an extended visit to PARC. He was so impressed that he offered to allow Xerox to buy a hundred thousand shares of his company for a million dollars—its highly anticipated I.P.O. was just a year away—if PARC would “open its kimono.”

They didn’t.

Xerox backed another system than the ALTO. It was more complex and late to the market, well after IBM and Apple had set the pace.

Xerox said no to the Alto, and in doing so turned their backs on the adventuresome spirit, the willingness to risk, and the faith to commit to the unpredictable course of a new technology that had characterized the company’s pioneering of Xerography in the 1950s under McColough’s predecessor, Joe Wilson.

Their actions reflected all the complexities of Xerox’s corporate culture of the mid-1970s: a one-product monopoly facing competition for the first time and losing market share, an organization grown bloated and complacent after more than a decade of unprecedented prosperity, a numbers-oriented, nontechnical, and risk-averse top management committed to the notion that, to be safe, any change required continuous cycles of testing and review.

They had lost the courage and persistence of their beginnings.

Sources: Smith, D. K., & Alexander, R. C. (1988). Fumbling the future: how Xerox invented, then ignored, the first personal computer. New York: W. Morrow.

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PROFIT DRIVERS DISAPPEARING Costs Rise, Revenue Falls— Critical Performance Metrics For The CFO’s Dashboard

BY MICHAEL P. FORESE, MBA | Sr. VP Finance + Operations AllSpire Health Partners & AllSpire Health GPO

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WHERE WE ARE TODAY

As the cost of healthcare has increased significantly in the past decade and although remedies have been implemented to stem the tide of rising costs, not-for-profit hospitals and health systems continue to face financial pressure in a dynamic healthcare landscape and there appears to be no end in sight. Hospitals are the single largest expense in U.S. healthcare at $1.1 trillion in 2017, or 33% of all national health expenditures, so it stands to reason this sector would be attacked with vigor. The emphasis on reduction in healthcare costs by the federal government and commercial payors has led to unfavorable financial trends for hospital-based health systems that appears to be on an unsustainable path.

• Moody’s Investor Services August 2018 report “Not for profit and public healthcare—US: Medians—Operating pressures persist as growth in expenses exceed revenue” noted the following on the financial pressure facing non-profit hospitals and public hospitals: • Median operating margins and operating cash flow margins fell to an all time low of 1.6% and 8.1% in 2017 respectively declining from 2.4% and 9.5% in 2016. Income from operations declined nearly 50% from 2016 to 2017.

• For the second consecutive year annual expense growth fell from 7.1% in 2016 to 5.7% in 2017 but annual revenue growth declined faster, from 6.1% to 4.6% despite increased merger and acquisition activity. Moody’s highlighted the widening gap between revenue and expenses as putting the sector on an unsustainable path given the small operating margins.

• More than 28% of hospitals reported operating losses in 2017 which increased from 16.5% in 2016 and is the highest percentage in five years.

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• 59% of hospitals reported lower absolute operating cash flow in 2017 more than double the 24% reported in 2015.

• Median Medicare and Medicaid payments as a percentage of gross revenue increased slightly to 45.6% and 15.5% in 2017 while the higher paying commercial sector declined to 31.9%. This trend is expected to continue.

• Less than 3% of net patient revenue came from capitation and risk-based contracting in 2017. Diagnosis Related Group (DRG) Payment was 41%, Fee Schedule 28% and percent of Charges/List Price was 17%.

• Inpatient and Outpatient growth rates were lower compared to historical averages.

• Median outpatient growth exceeded inpatient growth rates for the fifth straight year as the sector shifts to less expensive sites of care which deprives hospitals of delivering many profitable services.

• Median 1% rate of growth in inpatient admissions marks the lowest rate of growth in the last three years.

• Outpatient rate of growth of 2.2% in 2017 was the lowest rate of growth in five years.

• Bankruptcies among hospitals continue to rise with 20 filings since 2016 according to the Polsinelli-TrBK distress Indices Report. A U.S. Government Accountability Office report issued in 2018 highlights that 64 rural hospitals have closed between 2013 and 2017 as potential acquirers have little interest in their small markets. It is expected that small rural and community hospitals will continue to seek partners as revenue and expense challenges increase.

• Hospitals could face more pressure in the future from the wave of health care deals such as the health venture

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established by Amazon.com Inc., Berkshire Hathaway Inc. and JPMorgan Chase & Co., which will take aim at intermediaries in the health-care system as a part of a broad effort to reduce wasteful spending. The CVS/Aetna merger, which closed in November 2018, takes direct aim at hospitals. The merger combines CVS's pharmacies and its over 1,000 MinuteClinic’s, CVS Caremark pharmacy benefit manager and SilverScripts Medicare Part D program with Aetna's insurance business. The intent of the merger is to disrupt the traditional business model to lower the cost of healthcare. The plan is to channel the Aetna insurance subscribers to CVS Pharmacies and MinuteClinic’s and to expand services and programs that refer patients away from the highest cost site of care i.e. hospitals.

• On a positive note non-operating income performed well in 2017 and helped bolster bond ratings as investment returns were strong and the strong economy helped bolster contributions, driving a small reduction in debt levels despite the continual decline in operating margins and cash flow.

However, economic turbulence can quickly take away these investment gains and increase cost pressure on hospital-based health systems particularly driving the need to cut costs on the money losing government payor business. It should be noted that investment returns do not appear to be as strong in 2018.

HOW WE GOT THERE

The 2008 recession accelerated a decline in hospital margins.

While the recession was officially declared to start in December 2007 and end in June 2009 it had a much more lasting effect on the hospital market. The “Great Recession” created high unemployment as estimated jobs lost were 8.7 million, an unprecedented number, causing many individuals and families to lose private insurance coverage. Jobs were not added until 2010 but at a slow pace. Expenditures for hospital services grew at historically low rates following the recession and have

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not recovered to date. Fast forward to the present and the U.S. economy has gained back all of the jobs lost and more but shifting demographics and increasing cost pressures have maintained the drag on hospital financial performance despite a growing economy.

• At a high level the decline in operating margins is due to: • Increasing cost pressures (primarily labor and pharmaceutical costs) • Slow net patient revenue growth (primarily reimbursement declines, weakening payor mix, shift to outpatient care and increased ambulatory competition) • The operating margins decline trend is forecasted to continue as cost reduction initiatives are not expected to exceed the continual declines in reimbursement.

• Labor cost is the largest driver of operating expenses and are typically 50% or more of hospital costs. Labor expenses are high in general but exacerbated by a partially unionized workforce. In addition, a 2018 study by Navigant Consulting Inc. identifies that hospitals and health systems are facing continued shortages of physicians, nurses and mental health providers. In order to meet staffing needs hospitals are being forced to offer more generous compensation packages to attract candidates from a limited pool of talent. Projected estimates of the shortage vary but most predict a physician shortage greater than 100,000 by 2030 and a nursing shortage greater than 200,000 by 2025.

• Pharmaceutical costs continue to rise at hospitals/health systems. According to data from reports by the National Organization for Research at the University of Chicago (NORC), increases in average total drug spend per hospital

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admission increased 18.5% between fiscal years (FYs) 2015 and 2017. Inpatient drug spend per adjusted admission rose an average of 9.6% between FYs 2015 and 2017 following a 38.7% increase between FYs 2013 and FY2015. Outpatient drug spend per adjusted admission increased 28.7% between FYs 2015 and 2017. Hospitals experienced price increases in excess of 80% across certain classes of drugs, including those for anesthetics, parenteral solutions, opioid agonists and chemotherapy. Over 90% of surveyed hospitals reported having to identify alternative therapies to mitigate the impact of drug price increases and the increasing problem of drug shortages.

Payers are unable to keep pace with rising drug costs. For example, the growth in expenditures per hospital admission of inpatient drugs exceeded the Medicare reimbursement update (market basket) by five-fold during FYs 2015 to 2017, which is a direct reduction in hospital profits. Most of the factors driving increased drug costs are beyond the control of hospital-based health systems, so this trend is likely to continue.

• According to a December 2017 report from the American Hospital Association (AHA), CMS paid only 88 cents for every dollar spent by hospitals caring for Medicaid patients and 87 cents for every dollar spent by hospitals caring for Medicare patients for 2016 driving a shortfall of $20 billion for Medicaid and $48.8 billion for Medicare.

• As the population ages patients will transition from commercial insurance to Medicare at a fast pace. Medicare and Medicaid already pay below cost reimbursement to hospitals and health systems, and payments are forecasted to continue declining in order to stem the tide of rising spend of federal health programs.

The increase in spend is directly a result of rising enrollment, stemming from the aging of the population, expansions of federal programs, and rising health care spending per enrollee.

As a point of reference, 44 million beneficiaries were enrolled

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in Medicare in 2008, some 15 percent of the U.S. population.

Enrollment is expected to almost double from 2008 to more than 80 million by 2030 as the remaining “Baby Boomers” reach retirement age. As these “Boomers” continue to age the cost per enrollee is also likely to increase due to the increased prevalence of polychronic conditions.

• The effects of the Accountable Care Act • A key guiding principal of The Accountable Care Act (ACA) otherwise known as Obamacare was to significantly decrease healthcare spending by driving consolidation across the healthcare continuum. Regulatory and financial incentives drove hospital mergers, purchases of physician practices (less than 1 of 3 doctors are independent) and downstream investments in the care continuum. However, consolidation has not reduced the total cost of healthcare.

Increased market power led to higher commercial reimbursement and hospital cost has not decreased significantly as initial integration efforts are primarily focused on the lower cost back office functions. The more complicated clinical improvements take much longer and do not seem to have driven large increases in efficiency.

• The ACA was supposed to increase enrollment in health insurance plans through the individual mandate funded by the federal government (Medicaid expansion) to offset the high cost of treating uninsured patients in Emergency Departments. While enrollment in Medicaid has increased with 8.8 million total subscribers in 2018, the high cost of the health plans offered by the ACA has forced many beneficiaries into high deductible plans. Others decided not to secure health insurance at all and just pay the mandated penalty stunting the projected enrollment growth.

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• Inpatient hospital services have declined in part due to the large share of out of pocket cost responsibility borne by the patients in high deductible plans.

• The increase in high deductible plans has led to more bad debt for hospitals and health systems as these beneficiaries do not have thousands of dollars in savings to cover large out of pocket costs. Note that while the individual mandate was repealed by Congress in 2017, the Medicaid expansion and federal subsidies remain in place. However, the federal subsidies are scheduled to ratchet down in coming years leaving the states that participated responsible for an increasing share of the cost which may cause more financial headwinds for hospital-based health systems.

• Meaningful use of electronic health records provisions is responsible for the rise in implementations of highpriced electronic health records systems, which can cost hundreds of millions of dollars depending on the size of the hospital-based health system. The jury is still out on whether these systems will provide huge benefits to the hospital-based health system. While digital records improve patient outcomes, which of course is a critical advantage they also negatively affect the clinical team productivity with 7 out of 10 doctors in an annual Deloitte study noting that EHR systems reduce productivity, which obviously increases cost.

• New models of value-based care provision (accountable care organizations, bundled payments etc.) have increased an already burdensome regulatory environment and raised compliance cost.

• According to an AHA report titled “Regulatory Overload” for hospitals, an average size hospital dedicates 59 FTEs to regulatory compliance, over one- quarter of which are

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doctors and nurses. Physicians, nurses and allied health staff make up more than one-quarter of the full-time equivalents (FTEs) dedicated to regulatory compliance, pulling clinical staff away from patient care responsibilities.

• Historically the commercial insurance market has subsidized the below cost reimbursement hospitals and health systems receive from government payers. To combat the high cost that employers pay for employee health insurance coverage, the commercial insurance market has evolved in recent years to placing more financial responsibility on patients (higher deductibles and co-pays and higher maximum out of pocket expenses) and limiting the amount of subsidy paid by the employers.

THE FUTURE

The major question is how do hospital-based health systems maintain economic sustainability in this ever-changing environment where legislation can immediately change the business model with little time to adapt, and with many disruptive business models on the horizon? Let’s examine some of the ideas that have been presented to help hospital-based health systems navigate the current environment and create a sustainable business model.

• Is more M&A the answer? M&A has dropped with 90 announced hospital deals in 2018 down from 115 announced deals in 2017, though mega mergers (merger of equals) are on the rise. The best of the smaller independent hospitals have been scooped up as health systems acquired scale to take on increased risk. The shift from fee-for-service to risk sharing and value-based compensation will favor large health systems that can develop and maintain infrastructure to adapt to a population health environment (change from volume to value), though as previously noted risk based contracting only accounts for 3% of all net patient revenue. So, when exactly is

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risk-based contracting going to be primary? Other questions to ponder are how big do hospital-based health systems need to be to take on increased risk? And if large hospitalsbased health systems continue to propose merging will the government start blocking these mega-mergers in the interests of consumers?

• If not M&A, how about other types of affiliation? Network development can help gain negotiating leverage by providing infrastructure to manage a risk based contracting environment where population health and access are critical to success. Should hospital-based health system providers band together to develop insurance plans? This key revenue source could continue to develop and present a threat to independent commercial insurers.

• Are the large hospital replacement and expansion projects still viable? It doesn’t seem so. Overcapacity seems to be prominent across hospital-based health systems. The current trend is that capital expenditures on these large projects are being replaced by expenditures in new technology, ambulatory care and population health infrastructure to grab market share. Picking these investments wisely will be key to economic sustainability.

• How do hospital-based health systems combat the nontraditional healthcare deal entrants? Invest in non-hospital setting medical care (outpatient care) to offset the disruptive non-traditional healthcare deals i.e. Amazon/JPMorgan/ Berkshire & Aetna/CVS. These nontraditional competitors are aiming to provide care that is more consumer friendly, higher quality and lower cost. If you can’t beat them, join them. There is always going to be a place for hospitals, but hospital-based health systems must invest in a lower cost model to be viable in the total continuum of care.

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• Is it time for hospital-based health systems to consider shutting down facilities and/or business lines that are not profitable?

Millions of dollars were invested to build them, which makes it difficult to admit failure. Can they afford to be a one-stop shop in the current environment of shrinking margins and cash flow?

Specialization and affiliations with other providers could help drive improved economics.

• How can hospital-based health systems control labor costs and utilization and expand clinical capacity particularly in an environment where doctor and nurse shortages are prevalent and increasing the cost of care? Investments in revolutionary technology could be key to reducing clinical and back office cost such as Artificial Intelligence (AI) and Robotics Process Automation (RPA). Currently these technologies are in their infancy and are not being used widely despite the tremendous potential to reduce cost and increase clinical capacity.

• How do hospital-based health systems manage the money losing government payor business and the eventual transition to a risk based commercial contracting environment? Leveraging managed care tools (care guidelines, pre-approvals etc.) can improve risk contract performance and reduce Medicare operating losses. Keeping patients healthy is key to managing the operating results. Telehealth and remote patient monitoring to improve access and care coordination are critical to monitoring and maintaining patient health.

• How can hospital-based health systems control the rising cost of drugs? Since many of the factors causing the increased drug prices cannot be controlled by health systems, it is essential that health systems act on the factors they can control.

Pharmaceutical manufacturers, wholesalers and PBMs have no incentive to reduce drug cost since reduced prices result in decreased profits. Health systems must concentrate on controlling the spend for their employees through formulary

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and utilization management. Additionally, group purchasing of pharmaceuticals is essential for both the employee and acute care patient spend. Combining acute care drug spend with PBM spend will provide additional scale and market power to reduce the cost of drugs. Syncing of the acute care formulary and the PBM formulary will also enable enhanced utilization management. If cost and utilization control measures are implemented properly health systems should be able to control the drug cost trend at a minimum. â&#x20AC;˘ Are vendors partners or just suppliers? The rise of GPOâ&#x20AC;&#x2122;s and purchasing cooperatives have driven cost reductions and helped partially offset the reimbursement declines. There seems to be a need for a renewed pressure on vendors to decrease their prices to help relieve total cost pressure and the resultant decline in margins.

CONCLUSION

Hospital based health systems will continue to face financial and operating performance pressure. Reimbursement declines will continue, new business models and non-traditional competitors will continue to disrupt the industry. Developing a sustainable business model in this ever-changing environment will require the humility to admit that some mistakes have been made in the past and the boldness to embrace the fact that changes needs to happen sooner rather than later. Do you want to be Apple, which redesigned their business model and prospered, or Kodak who did not and went from a once dominant player in their market to a small bit player?

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Sources: Mathews, A.W., Evans, M. December 20, 2017.

Flurry of health-care deals reflects shift away from hospitals

S&P Global Market Intelligence. January 18, 2019. The Health Care Credit Beat: It's looking like another down year for ratings

Evans, M. September 25, 2017. Warding off decline, hospitals invest in outpatient clinics

Pearl, R. M.D., contributor. November 7, 2017.

Why major hospitals are losing money by the millions

Moody's Investors Service. August 2018.

Not-for-profit and public healthcareâ&#x20AC;&#x201D;US: medians - operating pressures persist as growth in expenses exceeds revenue

REVCYCLE Intelligence. July 20, 2018. How hospital merger and acquisition activity is changing healthcare

Singer, J.A. August 11, 2016. Obamacare gave rise to the health care mergers it's advocates oppose

S&P Global Market Intelligence. January 10, 2019. U.S. not-for-profit health care 2019 sector outlook: stable overall, yet key risks remain

Center on Budget and Policy Priorities.

February 12, 2019. Chart Book: The legacy of the great recession

Evans, M. April 23, 2018. U.S. hospital profits fall as labor costs grow and patient mix shifts

Channick, S.A. 2015. The ACA, provider mergers and hospital pricing: experimenting with smart, lower-cost health insurance options

Wagner, K. May 10, 2017. CFOs look into the crystal ball: The future business model of healthcare Butler, S.M. June 20, 2017. It's time to disrupt the existing hospital business model LaPointe, J. October 15, 2018. 4 Hospital business models for consumer-centric healthcare PwCHealth Research Institute. October 2018.

Provider systems of the future: What happens when the hospital is no longer the center of the health universe?

Kacik, A. August 29, 2018. Not-for-profit hospitals' cost-cutting isn't keeping up with revenue decline

Navigant. August 24, 2018. Hospital executives projecting clinician shortage volatility and labor budget increases

KaufmanHall. February 2019. 2018 M&A in Review: A new healthcare landscape takes shape

Bryant, M. August 24, 2018. Hospitals see labor costs rising amid ongoing doctor, nurse shortages

Bazzoli, G.J., Fareed, N. and Waters, T.M. May 1, 2014. Hospital financial performance in the recent recession and implications for institutions that remain financially weak

Evans, M. November 7, 2016. Nurses are again in demand LaPointe, J. May 2, 2018. Hospitals target labor costs, layoffs to reduce healthcare costs Bryant, M. November 1, 2018. Hospital bankruptcies soar, with 20 since 2016 LaPointe, J. November 8, 2018. Hospital bankruptcies are on the rise, hitting rural areas hard Ellison, A. September 17, 2018. 10 hospital bankruptcies in 2018 CMS.gov. July 2018. CMS Fast Factsâ&#x20AC;&#x201D;CMS Program Data - Populations LaPointe, J. July 30, 2018. Quantifying financial distress to stop hospital bankruptcy, closure Tennant, M. November 29, 2017. Hospitals going bankrupt thanks to ObamaCare

O'Brien, J. July 19, 2018. Not-for-profit system margins continue to decline

Japsen, B. January 16, 2019. Threats to hospitals emerging already from CVS-Aetna combination

Kacik, A. September 20,2018. Not-forprofit hospital operating margins continue to contract The Capital Issue. October 16, 2018. Hospital rating agency update: balance sheets and business combinations provide buffer in difficult operating environment Cigna Corporation. December 20, 2018. Cigna completes combination with express scripts, establishing a blueprint to transform the health care system LaPointe, J. October 30, 2018. Healthcare merger and acquisition deal value dips in Q3 2018 LaVito, A. November 28, 2018. CVS creates new health-care / Aetna officially closes Moody's Investors Service. April 2018. Hospital profitability sinks to levels not seen since the financial crisis: Moody's

Masterson, L. September 13, 2018. Hospital operating margins dropped 39% over 3 years

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THE BATTLE FOR CONTROL OF DRUG COSTS IDN vs Regional vs National

BY MICHAEL P. FORESE, MBA | Sr. VP Finance + Operations AllSpire Health Partners & AllSpire Health GPO

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PROBLEM

Prescription drug spending in the United States continues to rise at a significant pace. According to a study by the Pew Charitable Trust, prescription drug spending in the U.S. for both the retail channels (pharmacy, mail order) and non-retail channels (clinics, hospitals, long term care facilities and nursing homes) is estimated to be $535 billion in 2018, a 5.7% increase over 2017. The prescription drug spending increase of 5.7% for 2018 outpaces the 2018 medical inflation rate of 1.79% by more than three times.

Additionally, the Centers for Medicare and Medicaid Services projects that prescription drug spending growth from 2017 to 2026 will be the fastest among the major sectors of healthcare averaging 6.3% annually. This is mainly due to projected drug price growth influenced by trends in relatively costlier specialty drugs. Hospitals and health systems struggle with managing this significant cost for both their employees and acute care patients. Formularies developed by the Big 3 Pharmacy Benefit Manager’s (PBM’s) -Express Scripts, CVS and OptumRx) for employees of health systems can drive significant savings particularly if aggregated across several health systems due to increased rebates as a result of scale. PBM’s either transparently or behind the scenes procure a share of the rebates which can be a key driver in their profits.

However, these rebate driven formularies prove to be problematic as they do nothing to control the cost trend in future years because they promote drugs that offer the highest rebates rather than lower total costs and do not manage proper drug selection and utilization.

Increased drug spend at hospital-based health systems has also been on the rise. According to data from reports by the National Organization for Research at the University of Chicago (NORC) increases in average total drug spend per hospital admission increased 18.5% between fiscal years (FYs) 2015 and 2017.

Inpatient drug spend per adjusted admission rose an average of 9.6% between FYs 2015 and 2017 following a 38.7% increase between FYs 2013 and FY2015. Outpatient drug spend per

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adjusted admission increased 28.7% between FYs 2015 and 2017. Hospitals experienced price increases in excess of 80% across different classes of drugs, including those for anesthetics, parenteral solutions, opioid agonists and chemotherapy. Over 90% of surveyed hospitals reported having to identify alternative therapies to mitigate the impact of drug price increases and the increasing problem of drug shortages. Payers are unable to keep pace with rising drug costs. For example, the growth in expenditures per hospital admission on inpatient drugs exceeded the Medicare reimbursement update (market basket) by five-fold during FYs 2015 to 2017, which is a direct reduction in hospital profits.

The increases in prices for prescription drugs is not only difficult to manage from a health system perspective but is also threatening patient access to life saving treatments. A recent example is the two-pack of EpiPenâ&#x20AC;&#x2122;s price increasing from $100 to $600 causing many patients to end up in hospitals due to lack of affordability for their treatment regimen, needlessly driving up the cost of healthcare. Prescription drugs have revolutionized healthcare but if patient access and adherence is not managed properly they will ultimately lead to excessive additional cost. If prescription drugs are not affordable many patients cut their dose or stop taking the medication entirely. Nonadherence to appropriate drug treatment protocols particularly for maintenance medications such as those that treat diabetes and hypertension are a significant concern. Such nonadherence can lead to much higher medical costs for a patient if the patients incurs a stroke, heart attack or some other occurrence as a result of failing to take the appropriate level of medicine.

Seniors are particularly affected by high drug cost. According to an AARP report for 2017 the retail prices of the most popular prescription drugs older Americans take to treat everything from diabetes to high blood pressure to asthma increased by an average of 8.4% in 2017, far exceeding the 2.1% general inflation rate for other consumer goods and services and the 2.51% medical care inflation rate.

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WHAT CAUSES HIGH DRUG COSTS

There are many reasons why drug costs are high in the U.S. The U.S. pays more for pharmaceuticals than any country in the world. A large disparity exists between the prices of drugs in the U.S. compared to other countries. As an example, according to the Peterson-Kaiser Health System Tracker the prices of drugs in the U.S. can be 50 to 100% higher than European nations. To control drug prices the European Union has implemented price controls on drugs which limits the amount of margin that can be made across the supply chain. This action and drug price controls in general outside the U.S. throw the cost of developing new drugs and generating revenue for drug makers onto U.S. payers. The Council of Economic Advisors notes that while the U.S. represents 34% of the collective Gross Domestic Product (GDP) of the countries in the Organization of Economic Cooperation and Development (OECD), the U.S. is the source of 71 to 78% of the profits earned on branded drugs.

To address the need to control drug costs, the Trump Administration is evaluating tightening the inclusion criteria of 340b hospitals, restricting the criteria for fast tracking of “breakthrough therapy drugs” and reforming the reimbursement methodology on the Medicare Part B physician “buy and bill” which includes an international reference price index (IPI).

While these measures can have some impact on lowering drug costs they are missing the mark on the larger cost reduction options. Medicare and Medicaid which account for 30% of prescription drug spend are still not permitted to negotiate directly with pharmaceutical manufacturers. Medicare leaves the drug negotiation process in the hands of private payers who administer their “Part D” insurance plans. Medicaid takes the lowest negotiated price paid by private payers after which the individual states have the right to further negotiate price. The states obviously do not have the negotiating power attributed to the scale of national drug spend. At 30% of prescription drug spend

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in the U.S., Medicare and Medicaid combined are the largest single purchaser of prescription drugs yet have little opportunity to negotiate drug prices. Re-importation of drugs from abroad is another area where significant drug cost reduction can be achieved but is not yet considered a serious option. Many American consumers purchase drugs directly from Canadian pharmacies at a significantly lower cost. In addition, the complicated distribution and reimbursement system for prescription drugs (manufacturer, wholesaler, distributor and Pharmacy Benefit Manager (PBM) has not been seriously evaluated for cost reductions. In the U.S. model, where higher prices drive higher profits along the supply chain, this critical piece of the equation cannot and should not be ignored.

So how does the current model affect the cost of drugs? In theory, if the drug is a cost-effective therapy the total cost of healthcare should be reduced due to less hospitalization and other unnecessary visits to healthcare providers. However, overutilization leads directly to higher aggregate drug costs. Some common causes of overutilization include continuing to prescribe drugs after they lose their clinical effectiveness, the fee for service system where pharmacies are reimbursed based on the number of prescriptions they fill; and pharmacy benefit managers, wholesalers and pharmaceutical manufacturers receiving higher income based on volume of pharmaceuticals driven by formulary placement.

As in any business the list prices of drugs generally increase over time due to cost of supplies, inflation etc... In the prescription drug universe brand drugs developed by pharmaceutical companies typically concentrate on new therapies or pathways to replace existing brand drugs. Prescription drugs have limited exclusivity patent periods as well. Pharmaceutical manufacturers are granted a patent for 20 years from the date the patent application was filed. Recent estimates for development of new drugs of 10 years and a billion dollars to approval leaves 10 years or so to recoup their investment. However most of the pharmaceutical companies can extend exclusivity periods by the approval of new patents

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for modifications of those drugs some or most of which are not fundamentally new. European Countries have little ability to file these additional patents for existing drugs. In response, brand drugs in the U.S. typically experience higher price increases as their exclusivity period ends. Also, new brand drugs are often introduced at prices higher than the current drugs they are aiming to replace.

Additionally, brand drugs developed for new therapies are often introduced at high prices (compared to existing brand drugs) as new therapy compounds have the ability to generate a higher price premium. Historically switching to a generic drug has resulted in lower prices but recently some new generics have had very high unit costs (generally it takes two or more generic equivalents to significantly decrease the price versus the branded equivalent) and some other generics have had substantial price increases due to acquisition by another company or repricing. Additionally, because of the differences in patent protection between the two largest pharmaceutical markets (U.S. and European Union) generic substitutes can be available in Europe many years sooner than in the U.S. Some brand manufacturers have found ways to extend the life of patents including paying a generic manufacturer not to enter the market, often referred to as “pay for delay”. These extensions delay pricing reductions and cause pharmaceutical prices to remain high overall. Other strategies to delay generics include changes to formulations, strength in dosing, and increases in FDA-approved indications that could be treated by the drug. Each of these changes results in the generic manufacturer having to start over in redesigning the generic drug to secure FDA-approval.

Specialty drugs are one of the fastest growing drivers of increased drug spending. Specialty drugs or specialty pharmaceuticals are a designation of pharmaceuticals that are classified as highcost, high complexity and/or high touch. Specialty drugs are often biologics—"drugs derived from living cells" that are injectable or infused but can also be oral medications. They are used to treat

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complex or rare chronic conditions such as cancer, rheumatoid arthritis, hemophilia, H.I.V., psoriasis, inflammatory bowel disease and hepatitis C. Specialty drugs typically have higher prices than traditional brand and generic medications. According to a 2018 report by IQVIA Institute for Human Data Science the specialty drug share of net spending across the retail and institutional settings has grown from 24.7% in 2008 to 46.5% in 2017. The study showed that specialty drugs compose just 1.9% of total prescription volume but account for 34.7% of the spending within the retail and mail-order distribution channels. In the nonretail setting, specialty drugs account for 60% of invoice spend and 2.3% of standard unit volume according to the study. This obviously has a significant effect on drug mix and drives up the cost of prescription drugs. The largest proportion of new medicines launched in the last five years have been specialty drugs and specialty share of spending has risen while traditional net medicine spending has declined by more than $133 per person over the past decade. Of 42 new active substances launched in 2017, 32 were specialty treatments.

PBM’s can be part of the problem and are certainly not a complete solution to lowering drug cost. PBM’s have been around since the 1990’s. Their rise originated in the early 2000’s as part of the Medicare Modernization Act including Medicare Part D. The PBM’s role was to serve as a public-sector middleman between insurer (including Medicare) and the pharmacy to identify eligible patients, reduce administrative burden on the benefits provider and negotiate drug prices with the pharmaceutical manufacturers.

The rationale for the creation of PBM’s has been overcome by the drive for profits. Since market power is important in negotiating drug costs, the PBM market has become very concentrated with three firms (OptumRx, Express Scripts, CVS) controlling 80 to 85% of the market. PBM’s have also diversified into the drug distribution channels with investments in mail order, retail and

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specialty pharmacy which further limits drug price competition and creates a conflict of interest for the PBM’s. Drug formularies were intended to balance the need for managing costs while providing comprehensive therapeutic coverage for purchasers of the drugs by incenting members to use clinically appropriate and cost-effective medications.

Unfortunately, pharmacy benefit managers have been known to reward pharmaceutical manufactures that pay higher fees and rebates on brand drugs (for which the PBM takes a share) to preferred status on the formulary even though the particular drug is not the most cost-effective solution. The negotiation of drug prices with manufacturers, which includes upfront price discounts, rebates and other manufacturer derived revenue in exchange for the drugs inclusion (preferably as top tier) in the PBM’s formulary, is considered competitive intelligence therefore lacking transparency for the health plan sponsors. This provides the PBM’s with an ability to drive their own profits at the expense of health systems and patients. Another revenue stream for PBM’s is the pharmacy “spread “- i.e. charging a higher price to the plan sponsor than what the PBM pays to the pharmacy and pocketing the difference. Higher drug prices drive larger rebates and bigger spreads. This creates a conflict with the PBM and the health system since the health system’s mission is to keep drug prices low for their patients including their employees and their dependents. Since health systems have little insight into these price negotiations, it is virtually impossible to manage these costs. Health plan sponsors have made many attempts to contractually eliminate the lack of transparency but continued changes in terminology and scheme by the PBMs as well as their unwillingness to execute a fiduciary contract, maintains the lack of transparency.

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CURRENT STATE ASSESSMENT AND LESSONS LEARNED

Many of the drivers of higher drug costs are not directly under the control of health systems and it will be difficult for health systems to make any measurable impact. Higher U.S. prices for drugs compared to the rest of the world and delayed introduction of generics needs to be influenced by legislation, which will be driven by the federal and state governments. The increased prevalence of specialty drugs, and more broadly precision medicine, will continue at a fast pace. Specialty drugs have, and will continue to, enhance health outcomes but increase aggregate drug cost. Health Systems have no control over the specialty drug development and approval process by the FDA. While evaluating potential solutions to this vexing problem, it is important to review the lessons that have been learned in evaluating the PBM space as this provides keen insights for health systems in controlling drug costs for both their employees/dependents as well as on the acute pharmacy side. Some key points are as follows: • Volume/market power is critical to driving reduced drug cost and better contract terms. Combining acute care drug spend with PBM spend can provide significant increased market power • Acute care drug spend and distributor agreements are the largest component of drug spend (9X higher than PBM spend at AllSpire member health systems combined) • The pharmacy supply chain is terribly complex and must be constantly monitored and managed in an environment where change happens at a frantic pace • Current PBM system is not built to drive value-based healthcare —reimbursement not based on quality and outcomes • PBM reliance on rebates and manufacturer derived revenue creates mis-aligned incentive of increasing utilization of higher price brand and specialty drugs

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• PBM’s develop formularies to drive increased profits, not to control current drug costs and the cost increase trend • Specialty drugs account for 46.5% of drug spend in 2017 and is continuing to rise ALLSPIRE MEMBER PBM CONTRACT AND PROVIDER BASED PBM

For AllSpire the initial journey to reduce drug cost was to aggregate four of the member health systems employees under one PBM contract. The common contract was completed for the 2018 contract year and to date has driven a 21% decrease in employee drug cost saving a combined $27 million per year. The aggregated PBM contract was just a first step in the journey to reduction of drug costs. The AllSpire member health systems believed that further evaluation of formulary options and service models was necessary to determine if drug costs could be further reduced.

In reviewing the PBM landscape and learning that several health systems, namely Fairview, Banner, Intermountain and Northwell have established “Provider Based PBMs” it was decided that it was a logical avenue to explore. Establishment of a Provider Based PBM can provide the mechanism for control of drug costs. Since volume/ market power is crucial for group purchasing of drugs, further aggregation opportunities will be explored including adding other strategic regional healthcare organizations representing multiple health systems, as well as other individual health systems, ACO’s, employer groups etc. to continuously develop additional market power and further reduce drug costs.

Currently, the large PBMs with market power offer standard drug formularies which are rebate and fee driven and developed with the intent of optimizing PBM profits. A collaborative formulary developed by Integrated Delivery Network (IDN) experts (provider developed formulary) will drive decreased costs and improved outcomes by driving utilization of the most cost-effective therapy as opposed to a formulary which maximizes rebates/manufacturer

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derived revenue to drive higher PBM profits. The provider developed formulary will also drive decreased drug cost on the acute side as therapies are synchronized while both channels are under the control of the health system provider. Model providerbased formularies could also be developed with the assistance of AI/Analytic tools to drive optimal clinical and financial outcomes.

In essence, the Provider Based PBM would focus on managing utilization, high generic usage, continued alignment to acute care pharmacy and enhanced clinical services to improve patient outcomes. Taking over critical utilization management functions such as prior authorizations, quantity limits and step therapy are also being evaluated as programs tied directly to the provider developed formulary will provide additional utilization control and reduce drug costs.

ACUTE CARE DRUG SPEND INITIATIVE

AllSpire Health GPO (AHGPO) has embarked on an initiative to take a deep dive into acute care drug cost. Considering that reimbursement is not keeping pace with the rise in inpatient drug cost and that the acute care drugs purchased cost 9x the drugs purchased via PBM, it is vital that this component of drug spend be addressed. Through our national GPO partner, HealthTrust (HT), our members utilize a national contract with a major distributor utilizing existing HT contracts where available for the majority of their acute care drug purchases. The health systems also have executed individual contracts directly with pharmaceutical manufacturers for specific drugs. When working through a distribution agreement to purchase prescription drugs, it is difficult and time consuming to benchmark/assess the prices being paid when you consider that First DataBank has over 40,000 distinct national drug codes (NDCs) in their database and prices change daily. It is not surprising that health systems tend to avoid taking on the difficult task of managing the most significant component of health system drug costs as it is a laborious and time-consuming task.

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The initial tasks of the acute care drug spend initiative is determining whether the existing drug contract pricing is in line with the current market pricing, identifying which drugs are being purchased off contract, and determining whether existing individual health system contracts can be leveraged across the AllSpire members.

After completion of the analytical phase, development of an AllSpire-wide acute care drug formulary (preferably linked and synchronized with the AllSpire-wide PBM formulary) will be considered to simplify the formulary for easier management, as well as provide scale for the purchasing of specific drugs. The lowest net cost formulary will be a guiding principle including the preference for generic drug usage. Diligence in the development of the formulary will include evaluating alternatives to high price drugs (existing brands or generics), ability to pivot away from drugs with consistent or unexpected price increases, development and optimization of 340B drug programs, and continued evaluation and monitoring of the formulary with benchmarking against best practices. As with the PBM, diligence over utilization management functions will be a crucial part of the program being evaluated including the consideration of clinical best practice drugs to be prescribed for specific therapeutic area across the AllSpire health systems.

Specialty drug spend is a significant component of prescription drug spend and as such is a category that must be evaluated separately. Specialty drug spending has essentially doubled since 2011 and was 46.5% of all drug spend in 2017 while only approximately 2% of all prescriptions. Many health systems have built their own specialty pharmacies essentially turning a cost center into a profit center. At AllSpire the internal build model is being evaluated in aggregate and at the individual health system level. The initial evaluation of an internally built specialty pharmacy usually starts with the employee and Medicare Part D population.

If those two market segments can economically justify an internally built specialty pharmacy, it is usually an easy decision. 340B program eligibility is also a significant evaluation criterion as it

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can drive gross margins from single to double digit percentages.

All AllSpire health systems are now dispensing specialty drugs from their pharmacies bypassing the high-cost low-service specialty drug companies owned primarily by the PBMs securing some economic benefit. Absent the ability to build an internal specialty pharmacy, health systems can develop strategies for the group purchasing of specialty drugs, as well as develop utilization management strategies to ensure these high-priced drugs are being prescribed properly.

Shared services models are also being evaluated, particularly around prior authorizations as this difficult task has been shown to be done poorly by the external specialty pharmacies.

CONCLUSION

There appears to be relief to the trend of increasing drug costs.

Since many of the factors causing the increased drug prices cannot be controlled by health systems, it is essential that health systems act on the factors they can control. Pharmaceutical manufacturers, wholesalers and PBMâ&#x20AC;&#x2122;s have no incentive to reduce drug cost since reduced prices result in decreased profits. Health systems must concentrate on controlling the spend for their employees through formulary and utilization management. Additionally, group purchasing of pharmaceuticals is essential for both the employee and acute care patient spend. Combining acute care drug spend with PBM spend will provide additional scale and market power to reduce the cost of drugs. Development of AllSpire wide formularies and the syncing of the acute care formulary and the PBM formulary will also enable enhanced utilization management.

If cost and utilization control measures are implemented properly health systems should gain some control over the drug cost trend at a minimum.

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Sources: HHS.gov. October 25, 2018. HHS advances payment model to lower drugs costs for patients HHS.gov. October 25, 2018. What you need to know about President Trump cutting down on foreign freeloading HHS.gov. May 2018. American Patients First— The Trump administration blueprints to lower drug prices and reduce out-of-pocket costs LaPointe, J. April 26, 2017. Prescription drug rates remain top healthcare supply chain issue Dabora, M.C., Turaga, N. and Schulman, K.A. July 4, 2017. Financing and distribution of pharmaceuticals in the united states Quintilesims Institute. October 2017. Orphan drugs in the united states—providing context for use and cost The Council of Economic Advisers. February 2018. Reforming biopharmaceutical pricing at home and abroad

FDA.gov. January 2017. The generic drug review dashboard LaPointe, J. September 11, 2018. Hospital markups drive prescription drug spending, PhRMA Says…

FDA.gov, Center for Drug Evaluation and Research. November 28, 2017. Generic competition and drug prices LaPointe, J. July 23, 2018. Target prices to control prescription drug spending, AHA advises The Moran Company. October 2017. Hospital charges and reimbursement for drugs: analysis of markups relative to acquisition costs Craneware. 2009. Ensuring proper reimbursement for hospital-administered drugs 2009 Tirrell, M. April 19, 2017. In the debate over rising drug prices, both Drugmakers and PBMs claim innocence Chan, K. February 10, 2016. Why are drugs so expensive? - the role of pharma

Purvis, L., Schondelmeyer, S. MD. September 2018. Rx Price Watch Report: trends in retail prices brand name prescription drugs widely used by older Americans

Kamal, R., Cos, C. and McDermott, D. February 20, 2019. What are the recent and forecasted trends in prescription drug spending?

CMS.gov. February 2017. NHE Fact Sheet: Historical NHE, 2016

Pharmaceutical Commerce. February 12, 2018.

White house council builds a case for pharma pricing reform

CMS.gov. February 14, 2018. CMS Office of the Actuary releases 2017-2026 projections of national health expenditures The Pew Charitable Trust. February 27, 2018. A look at drug spending in the u.s.

James, D. Managing Editor, Specialty Pharmacy Times. April 26, 2018. Specialty drug spending grows while traditional medicine spending drops Bunis, D. (AARP). September 26, 2018. Retail prices of brand-name drugs continue to skyrocket Testimony of Woodcock, J., MD, Director, Center for Drug Evaluation and Research.

March 2, 2017. Generic drug user fee act reauthorization (GDUFA II), biosimilar user fee act reauthorization (BsUFA II)

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Henry J. Kaiser Family Foundation. January 29, 2019. 10 essential facts about Medicare and prescription drug spending Premier. May 2017.

Premier's roadmap for a healthier drug market American Academy of Actuaries. March 2018.

Prescription drug spending in the U.S. health care system

Amin, T. June 27, 2018. The problem with high drug prices isn't 'foreign freeloading,' it's the patent system Heath, S. August 23, 2018. How medication over utilization is costings patients thousands of dollars in out-of-pocket healthcare costs NORC at the University of Chicago. October 11, 2016. Final report: trends in hospital inpatient drug costs: issues and challenges Commins, J. January 16, 2019. Hospitals stressed by 'out-of-control' drug costs, shortages Woelkers, J.F., Payne, F. and Knudsen, A. Understanding drug purchasing from the hospital perspective Westhealth Institute / NORC at the University of Chicago. September 2018. What should be done about the high cost of prescription drugs NORC at the University of Chicago. January 15, 2019. Final report: recent trends in hospital drug spending and manufacturer shortages Hopkins, J.S. January 1, 2019. Drugmakers raise prices on hundreds of medicines Hopkins, J.S. and Loftus, P. February 5, 2019.

Flip the script: Drugmakers blame middlemen for price increases O'Connor, K. January 19, 2018. How patents play a role in drug pricing Schondelmeyer, S. and Purvis, L. December 2017. Rx price watch report: price growth for brand name and specialty drugs more than offset price decreases for generic drugs CMS. May 5, 2018. National health expenditures projections, 2016-25: price increases, aging push sector to 20 percent of economy

LaPointe, J. January 26, 2019. Hospital prescription drug spending increased 18.5% per admission Sachs, R. October 26, 2016.

Administration outlines plan to lower pharmaceutical prices in Medicare Part B

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SMART LIVING The Smart-Home For Health And Quality Of Life

BY PAUL J. TIRJAN, MBA

President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

What we call Smart Living, is a vision for the future where the home is less of a brick and mortar box and more of an interactive and connected environment of features that enhance and maintain health and quality of life. Whether the home is a house, an apartment, an assisted living facility or some other multifamily arrangement, there are common core needs that werenâ&#x20AC;&#x2122;t historically contemplated as part of residential real estate but are increasingly becoming integral to meeting the demographic and societal requirements of our time.

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DRIVERS OF DEMAND:

Baby-boomers retiring, living longer, managing more age-related chronic conditions

The baby boom generation is often defined as those born from 1946 through 1964, meaning less than half have reached the current Medicare eligibility retirement age of 65. Most can expect to live another 18 to 19 years on average. “ In the first year of the baby boom, 1946, rates increased to 24 births per 1,000 population, and in 1947 they peaked at 26.5. … During the post-World War II baby boom, the United States experienced 18 years of elevated fertility rates, with rates remaining above the pre- boom levels until 1964.”

—U.S. Department of Commerce, Economics and Statistics Administration, U.S. Census Bureau

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FIGURE 1.

NUMBER OF BIRTHS, ANNUAL PERCENT CHANGE IN NUMBER OF BIRTHS, AND ANNUAL BIRTH RATE FOR THE UNITED STATES: 1909 TO 2012

U.S. Births (in millions) 4.5 4.0 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0 1909

1919

1929

1939

1949

1959

1969

1979

1989

1965

1999

2009

1990

100+

100+

95

95

Male

90

Female

Male

90

85

85

80

80

75

75

70

70

65

Female

65

Millions

60 55

90

45

80

45

40

70

40

50

25

50

20

40

15

30

10

30 25 20 15

Baby boom

20

5

10 5

10

0 3

02

Baby boom

35

60

30

Foreign Born

55

50

35

Native Born

60

0 1

1950

0

1960

1

2

1970

3

1980

142

3

2

1990

1

2000

0

1

2010

2

3

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2012

2030

100+

100+

95

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1965

1990

100+

100+

95

FIGURE 2.

95

BY NATIVITY STATUS: 1950 TO 2010

85

90 Male Female POPULATION IN THE BABY BOOM AGES IN THE UNITED STATES

90 85 80

Male

Female

80

75

75

70

70

Millions

65 60

55

50

80

45

70

45

40

60

40

35

50

25

40

20

30

15

20

10

30 25 20 15

Baby boom

10

5

10 5

0

0 3

Baby boom

35

50

30

Foreign Born

60

90

55

Native Born

65

2

1950 1

0

1960

1

1970 2

3

1980

0 3

1990 2

2000

1

0

2010 1

2

3

2

3

Source: U.S. Census Bureau, 1950 to 2000 Decennial Censuses (Gibson and Jung, 2006) and 2010 American Community Survey.

2012

2030

100+

100+

95

95

Male

90

Female

85

85

80

80

75

75

70

70

65

65

60

Female

Baby boom

60

Baby boom

55

Male

90

55

50

50

45

45

40

40

35

35

30

30

25

25

20

20

15

15

10

10

5

5

0

0 3

2

1

0

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1

2

3

3

2

1

0

1

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So, we are still in the early goings of a dramatic aging of society as a whole. The cumulative effects of so many years with any combination of stress, sedentary lifestyle, poor nutrition, alcohol, smoking, drug abuse and environmental toxin or allergen exposure leaves this demographic not just elderly but saddled with a complex array of chronic conditions to manage. The care required does include acute care in hospitals, but the vast majority of chronic condition management and prevention must take place in the patient’s own home.

FIGURE 3.

PERCENTAGE OF MEDICARE FFS BENEFICIARIES BY NUMBER OF CHRONIC CONDITIONS AND AGE: 2010

47%

37% 34%

Less than 65 yrs

75 to 84 yrs

65 to 74 yrs

85+ yrs

33% 29%

28%

29% 27%

25%

23% 20% 17%

18%

17%

9% 9%

0 to 1

2 to 3

4 to 5

6+

Number of Chronic Conditions

Chronic conditions among Medicare beneficiaries—Centers for Medicare & Medicaid Services / Chartbook: 2012

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Elder care labor too expensive with insufficient supply & quality when delivered at home

The most simple and direct solution to problems associated with caring for an expanding elderly population would be to replace the care that throughout history was provided by family members in multi-generational households, with professional visiting home health services. While this has been a critical piece of the solution for over a century, the shifting dependency ratios as well as the shortcomings of caregiver time wasted in transit, along with the insufficient supply of high-quality workers willing to work for wages that the masses of patients can afford, leave vast unmet needs in the coming years.

FIGURE 4.

DEPENDENCY RATIOS FOR THE UNITED STATES: 1945 TO 2060

Ratio

Total

Old age

Youth

100 90 80 70 60 50 40 30 20 10 0 1945

1955

1965

1975

1985

1995

2005

2015

2025

2035

2045

2055 2060

Note: Total dependency=((Population under 18 + Population aged 65 and over)/ (Population aged 18 to 64))* 100 Old-age dependency=(Population aged 65 and over/Population aged 18 to 64)*100 Youth dependency=(Population under 18/Population aged 18 to 64)* 100 Source: U.S. Census Bureau, 1945 to 2012 Population Estimates and 2012 National Projections

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Retirement living facilities are cost prohibitive for the masses & surrenders independence

The affluent high end of this market is well served by facilities and communities designed for the special needs of the elderly, however, most are priced well beyond the means of the masses.

Even within the market segment that can afford such facilities, there is often strong resistance due to the loss of privacy, independence and the familiarity of home.

In an ideal world, we could perhaps simply build new affordable all-inclusive retirement villages, continuing care retirement communities or require zoning and building codes to require the necessary features be built into every new construction plan.

However, even if the cost wasnâ&#x20AC;&#x2122;t well beyond being reasonably attainable for the majority of the population, and even if we could wade through the nightmarish labyrinths of local politics that would need to be navigated, the time horizon to impact a significant percentage of the demand in this way will continue to relegate these approaches to niche markets of high affluence. It might make the basis of a great investment thesis, but it is not a practical systemic solution.

So, what would be necessary to meet the needs of the burgeoning elder population in-place, within the existing housing stock of single-family homes, apartments and condominiums?

TECHNOLOGY

The key parameters for technology solutions are extreme simplicity for the patient, minimize or eliminate dependence on human labor, minimize total annual out of pocket cost to the patient, and seamlessly transfer and integrate data with the hospital based integrated health system.

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Some specific needs for labor-less self-care housing solutions via automation:

1. Food quality, nutrition, delivery and meal preparation 2. Medication delivery and automated adherence support 3. Ubiquitous bio-sensor surveillance 24/7 with advanced emergency alert mechanisms 4. Anti-microbial/anti-allergen/non-toxic building materials for furniture, fixtures and household equipment 5. S lip and fall prevention flooring and infinity drain step-less showers 6. Motion-activated smart-dimming lighting 7. Voice actuated and video emergency communications and telehealth services 8. Robotic social determinants of health support and counselling 9. Coordinated or group purchased household maintenance, service and supply management 10. Smart automated HVAC, lighting and appliances 11. Transportation coordination and driverless vehicles 12. Safety and infection control environmental enhancements 13. I ntegration, filtration and analysis of home-based data within contextual hospital EMR data 14. Surveillance algorithms and predictive algorithms 15. Social interaction, entertainment and purpose activity

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BUSINESS MODEL

As each technology solution evolves in innovator companies, pricing, as well as marketing, distribution channels, payment methodology and customer relationship management plans, will be established to form a unique overarching new business model. One of the most challenging aspects of the business model will be the revenue model, or determining who is going to pay for the solution? How? And how much? It is innovation in the Revenue Model that warrants the most attention as shifts to new payors and new forms of payment could bring significant shifts in patient interactions, relationships and loyalties.

Paying for it:

Rent, condo fees & home owners associations

Apartment complexes already have a steady well-defined payment relationship with their residents that includes payments for a wide-array of shared services. Any health and quality of life related enhancements are simple line item additions to the rent if not already included. Fitness centers, pools and common kitchens are standard offerings today. Look for small on-site clinics serving multi-family housing to become more common additions, while new development and redevelopment will incorporate more in-home in-unit enhancements and services.

Cable or internet bill

Large national cable television, satellite and internet service providers control most of the data coming in and out of nearly all homes. Just as they can add a health or fitness channel to the monthly subscription today, they may well offer telehealth services in the near future. Most of these companies have begun investing heavily in the necessary smart home and in-home digital health technology, some acquiring whole companies to accelerate the process.

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Mobile phone bill

Mobile phone manufacturers are constantly innovating their products, and mobile service providers are constantly looking for value added services, to offer to differentiate themselves from competitors and drive growth. Wearable bio-metric connectivity devices in watches will advance to being imbedded in main stream clothing, smart tattoos as common as press-on nails and cochlear implants with diagnostic quality sensors, but all will increasingly require wireless transmission. One intriguing facet of the mobile phone sector as a healthcare payor is that digital health services for the infirm elderly could be added to their adult childrenâ&#x20AC;&#x2122;s mobile phone accounts, just as additional iPhone and Android handsets can be today.

Subscriptions and memberships

Traditional telehealth companies have long provided care on a feefor-service basis, usually with co-pay type disincentives designed to suppress utilization. These former innovators will either move to the more patient friendly fixed budget membership models or possibly get displaced by new entrants that beat them to it. The same dynamic applies to urgent care centers and retail pharmacybased clinics. Some of the incumbents will discover that the steady predictable but lower revenue per patient, along with higher loyalty and market share, is a fair trade-off. Again, if the incumbents donâ&#x20AC;&#x2122;t disrupt themselves, competitors likely will, and the first movers will win market share.

Insurance benefit

Even traditional health insurance companies have the potential for business model innovation. Medicare Advantage plans could easily incorporate many of the Smart Living concepts into their plan designs. Self-insured employers could either offer the benefits directly or, at a minimum, include such offerings as part of their voluntary benefits package.

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Sources: Recent Patient Health Monitoring Platforms Incorporating Internet of Things-Enabled Smart Devices. | Kang M, Park E, Cho BH, Lee KS | Int Neurourol J. 2018 Jul;22(Suppl 2):S76-82. doi: 10.5213/inj.1836144.072. Epub 2018 Jul 31.

Passive Radar for Opportunistic Monitoring in E-Health Applications | Wenda Li, Bo Tan, and Robert Piechocki | IEEE J Transl Eng Health Med. 2018; 6: 2800210.

Wearable Sweat Sensors | Mallika Bariya, Hnin Yin Yin Nyein, and Ali Javey | Nature Electronics, volume 1, pages160–171 (2018)

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Wearables in Medicine | Adv Mater. 2018 Jun 11:e1706910. doi: 10.1002/adma.201706910 | Yetisen AK, Martinez-Hurtado JL, Ünal B, Khademhosseini A, Butt H. Nanosensors for Chemical and Biological and Medical Applications | Seyyed Mojtaba Mousavi, Seyyed Alireza Hashemi, Maryam Zarei, Ali Mohammad Amani, and Aziz Babapoor | Med Chem (Los Angeles) 2018, Vol 8(8): 205

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Technology Readiness Watch

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REMOTE SENSOR TECHNOLOGY IN HEALTHCARE

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

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Passive sensor technology has been a part of our lives for hundreds of years. In 1858, Gaspard-Félix Tournachon, photographed Paris by balloon. More specifically related to health concerns, British coal miners carried canaries into the mines to use as early warning sensors to the presence of toxic gases or low oxygen areas within the mines. Photographic images, thermal signatures, chemical agent detection, infrared images, and seismic activity are all examples of current remote passive sensor technologies. All that is needed is a detector to receive the signal of interest which is present in the area or target of interest. In contrast, active sensor technologies require an external power source to transmit and receive data from the target. Radar is a classic example of active sensor technology, by sending an ultra-high-frequency radio wave or microwave out towards a potential target area, and then detecting the returned signal, an object can be located and with repeated or continuous monitoring, speed and direction can also be determined.

A key tenet of remote sensor technology is that the detection is often binary. That is to say, something is either detected or it is not.

A detector sensing ketone in a patient’s exhaled breath may signal diabetic ketoacidosis. But the concentration of ketones in the body cannot be quantitated by the detection alone. The correlation between breath concentrations and tissue levels must be determined under all conditions. In first generation healthcare associated sensors, the goal was to record a single characteristic of the patient.

Temperature can be assessed by infra-red sensors. Motion can be detected by microwave positioning. What is required in current day healthcare setting is much more robust and comprehensive remote biologic sensor determinations such as glucose, blood urea nitrogen, or drug levels in a person’s blood without the need to directly assess clinical tissue or blood.

While today we cannot yet assess the glucose level of a diabetic’s blood remotely without a physical interface, we have significant sensor technologies already in use or development that are assisting with care. Many current day sensors are used in a direct

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interface fashion to guide patients in daily care. The continuous glucose monitors utilize an invasive filament to read glucose levels every minute and have the ability to send data to smart phones or other receiving platforms. Now parents can monitor their child at school and away from home with confidence and accuracy.

Next generation glucose monitors are being developed as flexible non-invasive contact devices such as contact lenses and ultra-thin, flexible micro-electric, chemo, chromatic or thermo-chromatic body tattoos. They have the ability to read concentrations of chemicals in sweat or tears and approximate tissue or plasma concentrations.

With micro network WIFI connections or near field communication (NFC) chips, data can be sent to local smartphones or to cloud based data storage. True remote, noncontact chemical sensing and concentration determination is still a technology generation or two away. More work needs to be completed in correlating sweat or tear concentrations to plasma or tissue concentrations to provide clinically actionable information.

There is promising research and development taking place in healthcare that is based on detection, transmitting, and interpreting data for biological and physical monitoring of patients.

This body of research comprises both micro-invasive and non-invasive technologies and should serve as the prototype for further development.

DermalAbyss, is a collaboration between researchers from MIT and Harvard Medical School. The team has developed three injectable inks which respond to interstitial fluid changes in glucose, pH, and sodium concentrations. When injected intradermally as a tattoo, the glucose tattoo changes from blue to brown with increasing glucose levels. While still in the conceptual stage, the project demonstrates the sensor potential of cutting edge technology.

Profusa has developed its Lumee Oxygen Platform (CE Marked for use in the European Union and all countries that accept the CE Mark) to monitor patients with peripheral artery disease. It can

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monitor patients with chronic disease for evidence of progression and shows promise in post-operative patients for 28-day followup and evaluation. The tiny sensors are implanted in the region of focus to monitor oxygen levels which are detected by a receiver device applied to the overlying skin surface. Profuse is applying this concept to implanted sensors for glucose, lactate, and CO2.

A team of surgical researchers at Stanford are developing a biodegradable, battery-free sensor that can monitor blood flow through critical blood vessels supplying blood to transplanted organs or tissue grafts. These sensors can transmit wirelessly to a skin applied sensor and can alert surgeons to immediate changes to blood flow after surgery for attention if blood flow is compromised.

The biodegradable device will not require removal and degrades as the patient improves over time.

Even less invasive wearables are currently approved which can monitor high risk patients 24/7 with data managed through the cloud. BioStamp nPoint (MC10) is a wearable, waterproof, flexible sensor which wirelessly transmits data to the cloud on sleep/wake cycles, postural position, activity, heart rate and respiratory rate.

This data set is perfect for monitoring the high risk elderly in a home environment. Any single or combination of out-of-range parameters will be recognized through the cloud and available to care managers monitoring the clinical BioStamp data for intervention.

This is a real-time data feed with alerting capabilities enabling near real-time interventions possible.

Umana Medical Technologies has also developed an ultrathin SmartSkin Sensor technology which is applied to the skin surface like a tattoo and can detect signals and transmit for up to 5 days.

The system is capable of monitoring heart rate/atrial fibrillation, falls, systolic blood pressure, respiratory rate and can text alert any caregiver as to abnormalities detected.

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In 2016, Wegner described the Internet-of-things (IoT) by saying anything that can be connected, will be connected. He comes from a cybersecurity background and leads Ciscoâ&#x20AC;&#x2122;s cybersecurity public policy efforts. The concern over highly connected networks from a security viewpoint is well founded, but it is also from that perspective that healthcare benefits the most. The current integration involves digital assistant technologies like Amazonâ&#x20AC;&#x2122;s Alexa (one type of digital assistant) with sensor technologies like motion, heart rate, and sleep patterns. When a patient triggers an alert based on a preset digital biomarker algorithm endpoint, the assistant can also query the patient as alerts are sent to monitoring personnel.

The artificial intelligence can confirm if the current alert is real and threatening or perhaps a false-positive event. It can suggest immediate interventions while awaiting response from caregivers and it can assess emotional state and offer reassurances. This convergence of sensors, data and intelligence will measure outcomes based on readily available digital biomarkers such as heart rate, respiratory rate, body position, activity level, oxygen level, and emotional state. The future of pure population health interventions becomes more possible and measurable as to the effects and outcomes. These are very real near-term digital solutions from which patients and caregivers can benefit. The longer-term solutions for sensor technologies will be dependent on digital biomarker determination that correlates in vivo drug, metabolite, or chemical concentrations and integrates well with in-home digital assistants and remote EMR platforms.

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Sources: Wenger, E. (2016). The First Law of IoT: Things that Can Be Connected, Will Be Connected.

Security. Retrieved from https://blogs.cisco. com/security/the-first-law-of-iot Recent Patient Health Monitoring Platforms Incorporating Internet of Things-Enabled Smart Devices. | Kang M, Park E, Cho BH, Lee KS | Int Neurourol J. 2018 Jul;22(Suppl 2):S76-82. doi: 10.5213/inj.1836144.072. Epub 2018 Jul 31.

Passive Radar for Opportunistic Monitoring in E-Health Applications | Wenda Li, Bo Tan, and Robert Piechocki | IEEE J Transl Eng Health Med. 2018; 6: 2800210.

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Wearable Sweat Sensors | Mallika Bariya, Hnin Yin Yin Nyein, and Ali Javey | Nature Electronics, volume 1, pages160 -171 (2018) Wearables in Medicine | Adv Mater.

2018 Jun 11:e1706910. doi: 10.1002/ adma.201706910 | Yetisen AK, MartinezHurtado JL, Ă&#x153;nal B, Khademhosseini A, Butt H. Nanosensors for Chemical and Biological and Medical Applications | Seyyed Mojtaba Mousavi, Seyyed Alireza Hashemi, Maryam Zarei, Ali Mohammad Amani, and Aziz Babapoor | Med Chem (Los Angeles) 2018, Vol 8(8): 205

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EPIGENETICS Nothing Is Non-GMO

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

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Watson and Crick published their first work on DNA in 1953.

Since then, the study of human genetics has expanded and matured, spurred on by the field of molecular biology which has added clarity as to just how DNA works in our everyday lives.

Epigenetics now takes the concept of genetic heritability to a more nurture-based focus as opposed to a pure genetic code nature focus. Epigenetics is the field of heritable phenotypic traits which are not coded for by the ATCG genetic code sequences we all possess throughout all cells of our body. Instead, modifications to the existing genetic code provides for activation and inactivation of existing gene or gene clusters.

In 2018, the human genome is now estimated to be represented by 21,000 genes which code for proteins through messenger RNA transcribed from the underlying genetic codes (Willyard 2018). These 21,000 genes exist in all cells of the body. It is clear, though, that not all cells express all the proteins that these 21,000 genes encode. Moreover, the vast spectrum of physical traits and even behaviors that we see in families (she has her fatherâ&#x20AC;&#x2122;s eyes/nose/chin and disposition) cannot alone be represented by just these 21,000 genes alone. An epigenetic trait is a stably heritable phenotype resulting from changes or modifications in a chromosome without disruption or alteration in the underlying genetic sequences of the chromosome. (Berger et al 2009) How then does this subtle fine tuning of the genetic code take place resulting in an epigenetic trait?

An epigenetic phenotype is likely triggered by some event that impacts the environment of a cell (tissue type, organ, system, or whole body) Examples of signal triggers are diet (over or under nutrition), exercise, drugs, toxins, physical or emotional stress, and trauma. Once the signal is received and processed within the cells, chemical or structural modifications are made to the DNA without disturbing the established genetic sequence. To understand this more specifically, a brief discussion of the structure of DNA is needed.

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DNA is composed of 2 long strands of the nucleotides adenine, thymine, cytosine, guanine (A, T, C, G) linked together. The two strands bond together through pairings of the A-T and C-G to each other. This long double strand of DNA needs to be compacted into the structures of the 46 individual chromosomes which exist in pairs (23 pairs) in order to fit into the nuclei of the human cells. This compaction occurs when the DNA strands wrap around proteins called histones, much as when we wrap Christmas lights around a spool to manage the length for storage. Not only do the histones allow for compaction and structural support to the DNA strands, but in a compacted state DNA is usually inhibited from undergoing transcription of messenger RNA. In response to an epigenetic signal, DNA can undergo chemical modification of the nucleotides themselves by methylation (addition of one carbon) or acylation (2 carbons). The histones can also undergo chemical modification in the same way. In both cases, the resultant changes in the DNA or histones cause the underlying genes to be modified in such a way as to silence the transcription of specific gene sequences. This turning on or off of genes is what differentiates one cell type from another, may be the initiation event for cancer, may initiate many of the adult onset autoimmune or metabolic diseases, and what may result in the phenotypic or behavioral traits we see transferred from parent to offspring.

CURRENT STATE

The current state of clinical epigenetics can be described in 3 categories: discovery, diagnosis, and drugs. While the field of epigenetics was first envisioned in the 1940s by Conrad Waddington, it was largely ignored until the last 3 decades where with advancing molecular techniques and technologies, the pathophysiology of diseases and conditions are now better appreciated from a genetic standpoint.

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DISCOVERY

Fetal Alcohol Syndrome (FAS) is a devastating disease with classic phenotypic features. In addition to the neurologic manifestations of hyperactive behavior, difficulty with attention, and poor memory, there are the classic facial features of thin upper lip, flattened ridge between the nose and upper lip (the philtrum), and small eye size.

In much the same way that a child resembles their parents, these infants when young resemble one another. In seeking to better understand the syndrome and its classic phenotypic features, epigenetic evaluation has begun to better describe the genetic modifications taking place. Epigenetic research has identified numerous patterns of DNA and histone nucleoprotein methylation in alcohol exposed tissues. Non-coding RNA, which can control other messenger RNA or transcription events, has also been described in the expression by tissue after alcohol exposure. More recent investigations are looking at methylation events in specific putative genes which may be most susceptible to alcohol exposure.

This work has begun to lay the groundwork for the development of epigenetic biomarkers of alcohol exposure, which will be important in identifying children at risk for FAS. Moreover, the identification of valid biomarkers could enable the creation of strategies for earlier detection and diagnoses and ultimately specific interventions to ameliorate the effects of alcohol exposure in exposed fetuses.

DIAGNOSIS

Chemical modification of DNA by epigenetic signaling (stress, famine, hormones, toxins, nutrition) is of importance particularly when considering the 9-month period of pregnancy. After conception, the genetic code for the fetus is established in both the somatic and germ cell lines. But the environment for any fetus is unique to mother carrying the baby. Environmental and internal triggers can have profound effects on the fetus and subsequent health and intergenerational inheritance of any acquired epigenetic modifications. During World War II, famine affected

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the Dutch during a harsh winter. Babies conceived and born at this time were studied 60 years later. It was hypothesized that in response to famine, epigenetic metabolic reprogramming might take place. Clinically, these people were seen to have higher rates of metabolic syndrome, obesity, and diabetes. When their genes were studied versus age matched controls without famine exposure, distinct methylation differences were noted between the two groups. Conversely, maternal gestational diabetes induces epigenetic modification with altered methylation patterns in the offspring that predispose to obesity and diabetes. If only somatic cell lines were affected, then intergenerational transmission should not be an issue. However, if germ cell lines are also modified, transmission of the genetic modifications can take place to the next generation.

This recognition of the effects of internal and external conditions or triggers to the fetus raises new opportunities for earlier recognition of clinical syndromes for which the fetus may be particularly susceptible. Alcohol, opioids, tobacco, diabetes, famine, and social health stressors all play important roles in pregnancy for women worldwide.

As DNA methylation patterns are better mapped and characterized, more specific diagnostic testing can be developed to look at risks for the fetus.

Solid tumor cancers and hematologic malignancies represent the forefront of epigenetic diagnosis. Hypomethylation (activation inducing) of RAS genes (genes responsible for growth) has been well described for many solid tumors and hypermethylation of tumor promotor p16 (deactivation inducing) which control a colon cancer suppressor family of genes has been well documented.

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In many cancers and hematologic malignancies, current known mapped epigenetic modifications can be used to follow response to therapies as loss of those modifications is seen with successful treatment. Furthermore, in some cancers like lung cancer, alterations in DNA methylation patterns can be seen months to years before the onset of clinical disease. This suggests a screening algorithm which may better predict the highest risk for cancer after prolonged tobacco exposure. In glioblastoma brain tumor patients, the presence of hypermethylation to the MGMT gene family predicts high sensitivity to chemotherapy drugs used for glioblastoma.

In prostate cancers, global histone methylation patterns are associated with an increased risk for recurrence after therapy.

DRUGS

The epigenome represents a significant therapeutic opportunity versus genetic sequence modification as any changes made could be reversible where sequence modifications would be more fixed and difficult to reverse. Two classes of epigenomic targeting drugs are already in use: hypomethylating agents and histone deacetylase inhibitors. Hypomethylating agents are drugs that inhibit DNA methyltransferase which results in reduced methylation of the DNA strands. 5-azacytidine, a drug used in treatment of the myelodysplastic syndrome is an example of hypomethylating agents. Histone deacetylase inhibitor drugs result in increased histone acetylation and thus increased gene expression. The seizure medication valproic acid has been used for decades in seizure control. Recent investigation has shown it to be a histone deacetylase inhibitor. It is under current evaluation for sickle cell disease (for increased production of hemoglobin F) and in treatment of solid tumors (increased tumor suppressor functioning).

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FUTURE STATE

The next decade holds promise for increasing recognition of epigenetic mutations that cause a number of non-mendelian conditions and disorders. Mendelian genetics has failed to show classic inheritance of many common familial associated conditions such as schizophrenia, autism, and mood disorders.

The fetal period is one where epigenetic modifications can have lifelong effects as seen with the familial risks for metabolic syndrome and obesity. As more and more conditions have described epigenetic target site modifications, diagnosis for diseases which have been difficult to diagnose will become easier such as could be the case with Fetal Alcohol Syndrome. The great challenge will be in developing specific targeted methylation/ acylation or demethylation/deacylation therapies for the emerging genomic targets discovered for conditions felt to be epigenetic in origin. (Figueroa, 2018)

Sources: Grandma's Experiences Leave a Mark on Your Genes | By Dan Hurley, Discover | 04. 23. 2013 Epigenetics and Human Disease | Cold Spring Harb Perspect Biol. (2016);8:a019497 A Critical View on transgenerational epigenetic inheritance in humans | Nature Communications (2018)9:2973

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Adams, J. (2008) Imprinting and genetic disease: Angelman, Prader-Willi and BeckwithWeidemann syndromes. Nature Education 1(1):129 Principles of Epigenetics | UpToDate; Literature review current through: Feb 2019. | This topic last updated: Aug 17, 2018.

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DIGITAL ASSISTANTS

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

In 1968, Stanley Kubrick’s “2001 A Space Odyssey” depicted a heuristically programmed algorithmic computer, HAL 9000, to assist the crew of the Discovery One on its mission through space. HAL 9000 was able to speak and understand speech.

It could recognize faces, lip read and interpret human emotions.

It could conduct advanced automated reasoning (playing chess) and advanced algorithmic interpretation such as artistic critique.

These were visions of the future, and unfortunately for the crew of the Discovery One, tainted by HAL’s faulty interpretation of its prime mission directives. Today, all the purported capabilities of HAL 9000 exist. How might artificial intelligence (AI) enabled technology to support the healthcare environment in which patients and caregivers exist today?

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CURRENT STATE

Current digital assistants encompass four main categories.

AI enabled, voice activated assistants are already significant technologies that all segments and ages of our society use today.

Examples are Siri and Alexa, two digital assistants that we use in our homes and mobile cellular platforms. A specialized AI voice recognition technology also already in use is the voice enabled data input technology such as Nuance offers for electronic medical record clinical documentation. Similarly, all mobile platforms allow for voice input of text and email messaging. It is becoming obvious that any new home appliance or technology released today will likely have a version of an AI enabled voice operational command library. AI enabled monitors such as Fitbit or Apple watch can alert wearers to excessive heart rate or cardiac conduction disturbances.

In an even more direct fashion, the Medtronic Dexcom G6 or Freestyle Libre Pro can monitor a patientâ&#x20AC;&#x2122;s glucose levels and send alerts directly to the patientâ&#x20AC;&#x2122;s mobile device and to anyone else such as the parent of a diabetic child. Medical information search capabilities is another main digital assistant functionality. WebMD

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Symptom Checker has been available for patients to input symptoms and receive likely diagnoses to consider. Further information is available for those conditions of interest to the patient. Medline, PubMed, and Google Scholar have been used for years by clinicians to retrieve specific information on medical conditions, procedures and treatments. The last category of AI enabled technology is medical diagnostic support. Machine learning and deep learning networks now support the pathology and radiology specialties with abnormality detection algorithms for pathology specimens and radiographic images. In a Case Western Reserve University study, AI supported invasive breast cancer detection in pathologic specimens was nearly 100% accurate. In radiology, ChexNet developed by the Stanford ML Group was statistically better at the diagnosis of pneumonia versus trained radiologists.

ON THE HORIZON

Overall, the most likely evolution of AI enabled technologies in the short-term will be enhanced, more reliable solutions of those already in place. Moreover, integration of platforms into a single patient centric interface will be a necessity. Mobile phones, internet connected healthcare devices, apps and patient specific software/ web solutions, and the patientâ&#x20AC;&#x2122;s master health record (which is not necessarily one belonging to a healthcare system) all need to be interactive and interoperable. Integrating and interfacing these technologies will be a significant step forward in the coming 5 years.

Enhancements to and development of AI enabled supporting technologies within the electronic health record platforms are likely to be particular areas of focus. Better and more accurate voice recognition and dictation capabilities will be required for clinicians to have more contact time with patients and minimize non-value added (and non-reimbursed) documentation time. Additionally, interfacing natural language processing (NLP-the ability of computers to process and analyze natural language) more fully within the medical records allows for more real-time, minimally intrusive AI based

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“bot” interventions. For example, as a clinician dictates a hospital discharge medication, a prescription can be properly configured, checked against the current medication list for clinical compatibility, and sent to the pharmacy of record as the clinician is dictating realtime. No additional steps or EMR interactions would be required.

Pending lab and radiology studies can be immediately routed to both physician and patient, once received in the EMR. Medication prescriptions can be timed from receipt, projected for appropriate use and refills or refill request confirmations can be sent to the patient. If home internet enable devices are interfaced into the EMR, care managers can monitor and support high risk patients with complete data access. Aggregated data analysis from the health system EMR can target specific populations for contact, evaluation and interventions as applicable.

Current digital assistants in use by patients are the digital assistants that are primarily mobile platform based. These assistants employ “pull” operability configurations. That is, patients must request the interaction and management of the patient comes afterward as a result. The next generation of digital assistants must start each morning like a “second” spouse. Inquiring about symptoms and general health status, reminding of medications to be taken, recording weights, glucose levels and oximetry from patient home use medical devices (and uploading the results to a master patient record), and anticipating medical, dental, and other healthcare appointment needs. In emergent situations, chatbots could connect to family members or emergency medical services and coordinate EMS actions or arrange immediate urgent care home visits. Current chatbots are already able to interact conversationally with patients and suspect, or confirm diagnostic possibilities, as well as guide management or referral of depression.

AI enabled medical diagnostic capabilities will be prime targets for further virtual assistant development. Pathology slides can now be completely scanned in much less time than can be achieved by pathologists. The scans can resolve to the individual pixel

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level, beyond that of the human eye. The digital file of any x-ray, CT, MRI or nuclear study can be holistically evaluated not just for the suspected diagnosis but for the hundreds (thousands?) of conditions for which analytic algorithms have been created.

The tiny lung nodule is less likely to be missed in the face of the expected pneumonia which was anticipated. Early work with using AI supported diagnostic heuristics began with IBM and Watson. The hope was that advanced analytics could easily support evaluation of patient history, symptoms, supporting data and arrive at likely diagnoses. Accurate natural language processing NLP, medical jargon and abbreviations, and full integration of all data sources proved to be a significant barrier to early development. These are not insurmountable obstacles to further AI diagnostic refinements. With NLP training, medical dictation standardization, enhanced multi-technology interface improvements, this hurdle can be overcome. The intern can look like a seasoned clinician and both can be supported in times of increased patient volume or limited time.

What then is the future of AI enabled digital assistants in healthcare? This question can be easily answered as to just the technology. The rapid development and implementation of new and innovative digital assistant technologies and platforms over just the past 5 years has been unprecedented. The next 5 years should prove equally as transformative. Yet, without considering all the market segments which must follow the same path, the innovations and discoveries could exist in isolation. It is the synergy, integration, and coalescence across all segments of the market that will be required for the digital assistant to fully realize its potential benefit to patients and clinicians. The personal devices of the home, the remote monitoring devices of healthcare, the clinician's office, the â&#x20AC;&#x153;hospital of the futureâ&#x20AC;?, and all medical devices/sensors/robotics must all be interactive and all link to what will be the electronic health record for us all, whether consumers or patients.

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Sources: From diagnosing symptoms to assisting clinicians, digital assistants are plugging into health care | Health Care Current Sept. 11, 2018 | By Steve Burrill, Vice Chairman, US health care leader, Deloitte LLP AI for Virtual Medical Assistants â&#x20AC;&#x201C; 4 Current Applications | Kumba Sennaar | https:// emerj.com/ai-sector-overviews/virtualmedical-assistants/

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Virtual assistants like Amazon's Alexa could change the way care is delivered | Rachel Z. Arndt | www. modernhealthcare.com/article/20170731/ TRANSFORMATION01/170729892/virtualassistants-like-amazon-s-alexa-could-changethe-way-care-is-delivered How Artificial Intelligence is Changing the Healthcare Industry | Sumi Menon | www.cabotsolutions.com/how-artificialintelligence-is-changing-the-healthcareindustry

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ROBOTIC PROCESS AUTOMATION (RPA) Market Assessment & Vendor Profiles

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

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INTRODUCTION

Robots are historically thought of as being machines which can perform tasks that used to be done by people. The automotive industry is a classic example of where robotics has markedly streamlined production processes and time, decreased production defects, and decreased costs. This same approach can be applied to other processes which are system interactive in nature, repetitive, and currently rely upon people to initiate, maintain, and terminate.

Robotic process automation (RPA) is a software-based recreation of tasks and human interactions within a system of human workflows. One of the simplest robotic process automation (RPA) tools we all currently use is the password auto-fill function on our PCs, tablets and smart phones. With any new logon requirement, the robot or “bot” watches our creation of a new logon such as an email address and further records the password we assign to the logon. Future contact with the sign in site for our new logon will see the password auto-filled if we have enabled that process to be automated. An RPA solution is different than some traditional IT solutions in that it is not only developed with IT programming languages but also trained by business users in the logic of process flow, human behaviors and ways of delivering problem-solving methods (The Institute for Robotic Process Automation 2015, 22).

In 2017, AllSpire Health Partners (AHP) leadership began exploring opportunities to impact the key aspects of AllSpire – promotion of Clinical Excellence, Patient Affordability, Access & Experience and Economic Sustainability. Given the size of the member health systems, it was evident one area that presents an opportunity is labor costs – at a combined total of $ 7.1 B. RPA has the capacity to reduce the labor costs for certain areas of the health systems while improving the quality of work output, as well as the ability to free resources to perform more complex tasks. Because of these characteristics, AHP’s leadership team determined RPA was a strategy that required focused exploration.

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ROBOTIC PROCESS AUTOMATION (RPA) IN THE HEALTHCARE INDUSTRY

What RPA can do

In general, RPA has applicability in any processes that contain structured digital inputs, are repetitive and have a low amount of exception such as reporting, data preparation, application processing, knowledge management, transferring data and saving data. An RPA bot can be built as an automated system of master data management. RPA allows automation in different processes of collecting, integrating, matching, centralizing and distributing data around the organization. Additionally, a bot can automate core processes or can be trained to work with multiple systems and applications to deliver a specific workflow to mimic a human.

RPA bots can also be used in checking data and tracking errors from both internal and external sources and can deliver reports, reconciliation of financial processes and quality control.

Some examples already deployed in health care are:

• Finance & Operations—accounts receivable • Supply chain—contract element confirmation • Insurance/Benefit verification • Claims Denials processing • Credentialing of clinicians • Laboratory processing

BENEFITS THAT HEALTHCARE CAN GAIN FROM RPA

According to Robotic Process Automation (2018), there are both direct and indirect benefits of RPA that can enhance the efficiency and cost optimization.

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Three areas of direct benefits are:

• Employee Savings—RPA enables saving a considerable cost in human resources at approximately one-third the cost of a human employee. There is also enhanced productivity compared to a human FTE (full -time equivalent) employee due to its ability to work 24/7/365 and its capability of continuously learning and improving in their performance.

• Analytics—RPA allows data to be managed centrally and analysis of performance is real time with rules or key performance indicators (KPI’s) designed by the business users.

• Flexibility in Scaling—RPA solutions provide the ability to ramp up quickly when new workflows are identified.

While difficult to quantify, one indirect benefit of RPA deployment is higher staff satisfaction and engagement. RPA allows staff to work on more challenging but interesting tasks that require a higher level of knowledge and judgement. In addition, a guarantee of quality, speed and minimum of errors in delivering a service brings satisfaction to customers.

USE CASES IN HEALTHCARE INDUSTRY

Bolstering Revenue Cycles: Organizations can benefit greatly from

the technology’s ability to improve the revenue cycle and related administrative processes. Outdated systems often must deal with multiple code changes or updates that take place during the billing cycle, but RPA is capable of adapting to these changes in an easy and seamless manner. The technology automates menial, timeconsuming and repetitive processes such as data digitization and accounts receivable, which can ultimately improve billing efficiency and lower the number of write-offs. This ultimately helps healthcare providers conserve resources.

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Claims Administration: Another time-consuming task that can be

automated is claims processing, including data inputs, adjustments and the appeals process. RPA has the ability to process an entire claim in a fraction of the time it takes humans and with minimal errors. Although the technology is the early stages in this front, it has great potential to remove wasted energy and inefficiency from the entire claims process.

Optimizing Care Delivery: RPA has great potential in mining

medical records to provide analysis and data based on a patient’s condition and progress. The technology can monitor a patient’s journey from the onset of symptoms to current state and offer a smart diagnosis and treatment options by analyzing data from vast databases of medical content as well as internally developed care pathways. Application of RPA in this manner would streamline clinicians’ work and, ultimately, expedite treatment of patients.

The technology can be applied to care management, including coordinating that care, case and utilization management, population wellness and remote monitoring of patients.

Savings in Human Labor and Improved Quality of Work: Perhaps the best potential application of RPA is in its ability to automate manually intensive administrative tasks and save valuable time.

RPA will not replace human workers, but instead will help elevate their productivity by focusing their time and energy on higher-value work that maximizes use of their expertise. In care delivery, a 2009 Texas hospital study found that automation in the areas of medical records, order entry and decision support resulted in a reduction in deaths, complications and cost. The principal author of this study now uses automation and machine learning to solve some of the most vexing problems in healthcare (Amarasingham, et al. 2009).

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RPA VENDOR ANALYSIS

Overview

RPA vendors provide their platform with tools for business users to develop different types of robots based on their specific needs.

Today, there are over 50 RPA product vendors in the market. Any processes that require being automated ought to be studied and analyzed before a vendor is chosen. The analysis guarantees that a requested need for automation matches with the capabilities of a preferred RPA tool. Thus, an RPA development process can be planned cautiously to be productive, efficient and cost-optimized (Parvez & Agaram 2017, 20).

The top three vendors identified from several sources are UiPath, Automation Anywhere, and Blue Prism. These market leaders vary in rank from year to year, however as more competition enters the market, all three are steadily adding capabilities and partnerships to further their continued dominance. While not as strong as the three top leaders, WorkFusion has focused on the health care market, and has worked with Humana and New York Presbyterian among others.

Revenue >

MARKET LEADING RPA VENDORS

Automation Anywhere

UiPath WorkFusion

Blue Prism

Market Penetration >

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RPA VENDOR PROFILES

Automation Anywhere

Founded in 2003, Automation Anywhere Enterprises (AAE) is a San Francisco based firm that has 2018 revenues greater than $160 million. AAE has over 100 implementation partners globally including Accenture and IBM, which is twice the amount for Blue Prism and UiPath. Large enterprises like Google, LinkedIn, Volkswagen and Siemens leverage their platform, which consists of “taskbots” as well as an embedded analytics tool, Bot Insight for operational and business analytics. Leveraging a software and SaaS delivery model, machine learning and artificial intelligence (AI) are embedded across Automaton Anywhere’s suite of products.

It’s “IQ Bot” has a cognitive bot that is designed for unstructured data and learns from humans correcting. Their control room is very intuitive and the platform itself receives high marks for usability, with about 20% of use cases being attended, and 80% unattended.

From a pricing perspective, they offer flexible pricing methods that cater to a wide spectrum of customer’s needs related to the number of bots deployed.

Blue Prism

Blue Prism is a U.K.-based software corporation founded in 2001 and considered one of the pioneers of RPA. The company produces RPA software called Blue Prism Digital Workforce (V6) and its revenue in 2018 was $38.1 million. Some of Blue Prism’s largest customers are Coca Cola, BNY Mellon and Walgreens. BluePrism has around 50 implementation partners, and only sells their solution through VARs, and training is a significant focus. Blue Prism is considered to be a very solid platform because of its longevity and continued evolution. Their model of delivery is software and reference architecture including Microsoft, Amazon Web Services (AWS) and IBM. Reviewers report that the platform’s automation has improved greatly in their most recent release, although their control room environment is still not intuitive, and they also are just

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incorporating AI in their most recent release. One hundred percent of use cases are unattended. Of note, in early 2019 Blue Prism launched “connected-RPA” which is essentially crowd-sourced innovation sharing leveraging their platform.

UiPath

UiPath is a US based key player in the RPA market. Founded in 2005. UiPath’s platform consists of UiPath Studio, which is the workflow designer component and UiPath Orchestrator which support virtual worker management. In 2019 the company’s revenue as $43.5 million with over 50 implementation partners.

Some of UiPath’s larger customers include General Motors, MassMutual, and Bristol Myers Squibb. The UiPath Enterprise RPA Platform can be deployed in the cloud or on premises and consists of three integrated components. First, is the UiPath Studio, which is the process modeling environment where users can, with minimal training and no coding, model process automations visually using powerful recorders that literally build automation by watching the user work. The UiPath Robot is the digital worker that executes scheduled work either ‘unattended’, in large batches and without human intervention (e.g. invoice processing) or ‘attended’, running on the users’ PC and following their direct command (e.g. call center processes). The UiPath Robot also possesses advanced computer vision to perform rapid and precise automation which opens, acts upon and closes any local, legacy or Cloud application and extracts, processes and passes data between any structured and semi-structured data source (applications, documents or databases). An intuitive platform, UiPath’s solution is split between 30 % attended use case an 70% unattended. And finally, the UiPath Orchestrator scales and prioritizes work queues & robots ondemand according to assigned priorities that are part of the build.

WorkFusion

An emerging RPA provider, WorkFusion offers a platform that can run on a laptop, desktop or server. Launched in 2011, this New York

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based firmâ&#x20AC;&#x2122;s 2018 revenues came in at $35 million. WorkFusion offers a product called Smart Process Automation (SPA), which is an AI-driven automation platform that combines AI, RPA, OCR, analytics, and workflow built-in to enable end-to-end automation on a single platform. This single platform with all critical automation capabilities circumvents the need for multiple tools to license, deploy, and maintain. SPA offers bots that serve as an enterprise intelligent digital workforce and uses machine learning to learn, adapt, and adjust in real-time from the available data so no need for massive data, data scientists or coding. Its other features include business logic machine learning and workforce automation insights. They also offer a free platform, called RPA Express. Some of their key clients are Citigroup, Chubb, Humana and New York Presbyterian.

Olive, Inc. (formerly CrossChx)

Olive, Inc. is a healthcare-specific artificial intelligence and process automation company that focuses on healthcare organizations to improve efficiency and patient care while reducing costly administrative errors. Its AI solution, Olive, acts as the intelligent router between systems and data by automating repetitive, high-volume tasks and workflows, providing interoperability. Olive has helped healthcare organizations reduce data and billing errors, eliminate denials for no coverage, improve cash collections by reducing days in A/R, and more.

In June 2018, the company raised a $32.8 million Series D round from Oak HC/FT and Ascension Ventures with participation from existing investors. With this round of funding the company intended to scale Olive throughout healthcare organizations nationwide and invest in new capabilities such as Pupil, its process mining tool.

As of March 2019, they have over 250 healthcare clients Olive is the first healthcare automation solution on the market using AI to streamline repetitive tasks and workflows by working with

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existing systems and is uniquely positioned to counteract the ever-increasing cost of healthcare and humanize many cumbersome processes. Key clients include OhioHealth, Keck Medicine of USC and they also have a partnership with NCI, leading provider of enterprise solutions and services to U.S. defense, intelligence, health and civilian government agencies. NCI intends to leverage Olive platform to provide proof of concepts across areas such as fraud, waste and abuse, cybersecurity, machine-to-machine communication (M2M) as well as patient care coordination.

Agilify

Because Blue Prism only provides its bots via partners, Agilify was researched by AHP as an option to support the use of the Blue Prism platform. Agilify is a consulting service that grew out of Ascension’s Indianapolis-based shared services subsidiary, the Ministry Service Center.

This division of the nation’s largest Catholic health system used RPA to save the health system 10% in all costs for five straight years. Agilify guides external organizations from healthcare and other industries in developing an RPA strategy. They work with all RPA vendors, but specify Blue Prism and Automation Anywhere as their own internal “go-to” vendors. Blue Prism recognized Ascension’s innovative automation programs approach and partnered to make Agilify its first authorized training partner in North America. Blue Prism named Agilify its 2018 Training Partner of the Year.

The leaders of Agilify gained deep expertise in automation by applying new technologies over the past seven years at Ascension. As a result, Agilify brings real-world practitioner experience to the market across the full gamut of business-process, robotic-process and software-process automation training, consulting and technology selection.

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Agilify has developed a broad range of technology partnerships and clients and a full line of consulting, implementation and learning services in addition to its Collaboratory. The Collaboratory provides technology assessments for this rapidly advancing technology landscape and has been instrumental in developing Agilifyâ&#x20AC;&#x2122;s longterm strategy. Agilify recently helped Ascension implement its first machine learning production system.

CONCLUSION

RPA offers benefits to healthcare organizations which can be customized depending on workflow and process replication. Error reduction through exact and replicated coded data inputs or transfers can reduce rework or payment denials. From a human factors perspective, repetitive data input processes, redundant data entry, and data retrieval and transfer are all processes with poor staff engagement, high error rates, and low staff satisfaction. Supporting staff by off-loading these low-level repetitive actions frees the staff for higher level production needs or tasks of a more meaningful nature and results in higher staff satisfaction. Healthcare is process intensive, very dependent on software solutions within the daily workflow, and is seeing increased demands for higher productivity at lower costs. RPA offers the possibility of meeting these expectations via specialized software automation scripts which re-create the human interactions within a process workflow. RPA holds much promise in healthcare and could produce tremendous return on investment for integrated delivery networks and hospital-based health systems.

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Sources: PParvez, F. & Agaram, H. 2017. What challenges are organizations facing in deploying RPA?. Journal of CIO Advisor, 2 (7), 20-21. Published by Valley Media Inc. https:// www.cioadvisorapac.com/magazines/ October2017/RPA/ Accessed 9 October 2018 Robotic Process Automation. 2018. RPA Benefits. Accessed 9 October 2018 . http:// www.robot- icprocessautomation.es/rpabenefits/?lang=en Robotic Process Automation (RPA) Applications in the Healthcare Industry. Karl Utermohlen https://medium.com/@karl.utermohlen/4robotic-process-automation-rpa-applicationsin-the-healthcare-industry-4d449b24b613 Accessed 9 October 2018

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Amarasingham, R et al. January 26, 2009.

Clinical information technologies and inpatient outcomes. Annuals of Internal Medicine.

Gartner Market Guide for Robotic Process Automation Software. 2017. Accessed 5 March 2019. https://www.gartner.com/doc/3835771/ market-guide-robotic-process-automation IT Central Station. Robotic Process Automation (RPA) Buyers Guide and Reviews. March 2019.

Accessed 5 March 2019.

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Innovation Highlights

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THE BURDEN OF SEPSIS

BY JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

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The Centers for Disease Control and Prevention define sepsis as a clinical syndrome with life-threatening organ dysfunction caused by a dysregulated host response to infection. The burden of sepsis is high, with over 1.7 million adult sepsis cases annually in the U.S., which contribute to 270,000 deaths. Patients who survive sepsis often suffer long-term physical, psychological, and cognitive disabilities.

Sepsis Surveillance Toolkit available at: https://www.cdc.gov/sepsis/pdfs/SepsisSurveillance-Toolkit-Aug-2018_508.pdf

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Two sobering facts from the Global Sepsis Alliance bring home the challenges for healthcare systems today. Each year, sepsis causes more deaths than prostate cancer, breast cancer and HIV/ AIDS combined. Each year from 1997 through 2008, the inflationadjusted total costs for treating patients hospitalized for sepsis increased 11.9 percent on average with the 2008 costs for sepsis hospitalizations in the United States estimated at $14.6 billion.

This human and economic toll must be addressed by healthcare providers across the nation.

A collaboration between the Society of Critical Care Medicine and the European Society of Intensive Care Medicine and in partnership with the Institute for Healthcare Improvement (IHI) created clinical sepsis management bundles to help frontline providers implement the sepsis prevention and management guidelines. The result is the Surviving Sepsis Campaign which is the framework that healthcare organizations have adopted to address sepsis as a leading problem impacting patients in our healthcare systems.

The members of AllSpire Health Partners, through the Clinical Leadership Council, selected sepsis as one of the first clinical improvement collaboratives for all members to participate and benchmark performance and share best practices. Through data reporting, collaboration, sharing of best practices, and site visits, the members have achieved improvements in the attributable mortality in their sepsis patients. The collaborative will be expanding to include prehospital management by EMS and post-acute management in skilled nursing facilities, home care, and in high risk patientâ&#x20AC;&#x2122;s homes.

In the following articles, member case studies will be highlighted.

Sources: CDC. https://www.cdc.gov/sepsis/index.html.

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TRANSFORMING THE MODEL OF CARE FOR PEOPLE WITH SEPSIS

BY STEVEN L . DELAVERIS, DO | Vice President Medical Service Line, WellSpan Health JODI R. CICHETTI MS, RN, CCM, CPHQ | Sr. Director Quality + Clinical Improvement, WellSpan Health EMILY EDLEBLUTE RN, MS, ACNS-BC, CCRN-K | CIC Program Director, Medicine Service Line, WellSpan Health

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In FY2018 WellSpanÂŽ Health (WSH) embarked on a three-year journey to achieve national top performer status in sepsis care, focusing upon the core strategy of achieving clinical reliability to support outcome excellence. We learned a few grim facts regarding our patient population: Sepsis, Severe Sepsis, and Septic Shock were the number one reason that patients were admitted, and our mortality rates were higher than expected, at all of our four acute care hospitals including; York Hospital, a large 580 bed rural, community, teaching hospital with Level 1 Trauma; Ephrata Community Hospital (130 beds); Good Samaritan hospital (151 beds) both mid-size community hospitals (one teaching); and Gettysburg Hospital a 76 bed community hospital.

Peer reviewed studies are frequently published to report on clinical outcomes associated with various interventions. These range from use of steroids to cinnamon sticks in addition to ofttimes conflicting reports of published guidelines. Payers have taken advantage of this time of vulnerability, where evidence is in discovery and medicine is developing. The result is distracting, and expensive.

Photo (Left) Central Alert Team (CAT) Management, CAT Registered Nurses and PRN Pool Registered Nurses.

From left back to right: Emily Edleblute, Aileen Faust, Amy Engram, Cathy Weaver, Deanna Winterling, Angela Mays, Holly Wolfe From left front row: Shannon Fouts, Cynthia Yascavage, Sheila Hardesty, Dana Gaultney, Kim McCaughey Not pictured: Jodi Cichetti

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The Sepsis Clinical Effectiveness Team (CET), a collection of clinicians across the health system, established consensus to rely upon the evidence and recommendation of the international Surviving Sepsis Campaign as its foundation, with the published clinical criteria driving the best practice protocols. The WSH clinical teams worked with the technical and informatics experts to review data and recommendations and has developed/disseminated an evidence-based bundle of treatment/care intervention within the Electronic Health Record (EHR) for adoption and spread across our hospitals. Subgroups have been established at each entity to assure engagement and clinical reliability.

Additionally, within the EHR the clinical teams developed a customized algorithm based upon evidence of learned hemodynamic changes/thresholds and lab value combinations, to create automated alerts to address early recognition of people with

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or at risk of sepsis. Leveraging the EHR, the combination of alerts (tools) and treatment bundles (mechanisms) have supported early recognition and timely adoption of evidence-based care.

We implemented the innovative idea that a remotely and clinically staffed telemonitoring bunker could provide real time surveillance for early identification of sepsis. Much like “air traffic control” this team could provide continued clinical support to initiate review, and validate alerts to support timely evidenced based treatment, with ongoing monitoring for treatment timing and compilation, and positive patient response. A team of Registered Nurses (RNs) with Intensive Care Unit/Emergency Department experience was brought together to devise and implement this innovative idea in the form of a new care team model. These 5.0 RNs work 24 hours a day, 7 days a week, 365 days a year to; screen, validate, and research electronic health record “best practice” alerts (BPAs) for SIRs, Sepsis, Pediatric and OB Sepsis, and ED Triage at all hospitals. Over the course of the Year 1 performance period, the Central Alert Team supported the care of 11, 520 unique patients, and we project an annualized opportunity to provide this quality of care improvement for over 17,500 unique patients.

The original care model design implemented at one WSH hospital to enhance care quality, included a conventional “Help Team” or “boots on the ground”, physically tethered to the patient chart and those related limitations of how fast one person can respond and prioritize. The screening time averaged greater than 67 minutes on average, and a considerable number (average 22%) of sepsis alerts never received Help Team response, depending on the hospital wide patient acuity. Additionally, monitoring for patient treatment bundle compliance was on the fly, and “time zero” was often unknown concurrently.

In the new care model, time zero in the septic patient, is the time of the sepsis alert. This is documented clearly in the record, inclusive of the sepsis bundle treatment time requirements (for 3 and 6 hours)

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for ease in reference and monitoring/tracking by the Central Alert Team. With implementation of the CAT, the average screening time for sepsis alerts decreased to 12.12 average minutes or an 82% improvement. The average sepsis treatment bundle compliance improved from a baseline of 34% (July 2016), to 85% (May 2018) for all hospitals. Mortality observed rates improved at every hospital, and overall implementation costs are less compared to more traditional care models, impacting both the quality and cost components of the value proposition. Overall resource utilization has improved by operating remotely and through telemonitoring.

The historical Help Team care model described includes employees physically â&#x20AC;&#x153;getting to the bedsideâ&#x20AC;? which would require a minimum of 4.5 FTEs for 24/7/365 coverage, multiplied by five hospitals or equaling a minimum of 22.5 employees. This new care model Central Alert Team receive these alerts directly for five (5) hospitals, and communicate with physicians and nurses at the bedside, as well as other ancillary care team members.

A NEW MODEL OF CARE FIGURE 1.

COMPARATIVE TABLE FOR TRADITIONAL VERSUS NEW CARE MODEL

TRADITIONAL MODEL

NOVEL MODEL

Reliance on "boots on the ground" to drive care

Remote monitoring to provide treatment decision support

Alert fatigue

Alerts screened by experienced RNs

All alerts require same attention by clinical team

Attention focused to appropriate patients

Individual clinician's knowledge

Leveraging humanity

Staffing at the hospital level (20 FTEs)

Staffing at the system level (5 FTEs)

Alert issues may be noticed and reported by astute clinicians

Alert issues identified by group familiar with them, who work closely with P1 team for resolution

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FIGURE 2.

WSH SEPSIS WIG BUNDLE COMPLIANCE W/ CONTROL CHARTS JULY 2017–MARCH 2018

WGH Sepsis WIG—Best Practice Bundle, Sepsis/Severe Sepsis/Septic Shock Rate

WGH Sepsis WIG—Best Practice Bundle, Sepsis/Severe Sepsis/Septic Shock Rate

CAT INTERVENTION 100 GOAL=74% 80 60 40

CAT INTERVENTION

90%

100

MEAN=71% 74%

67% 55%

56% 59% 61%

52%

46%

67% 74% 56%

84%

79%

82%

84% 85%

GOAL=74%

80

MEAN=61% 69%

N/A

60

61%

40

45%

45% 38%

35%

41%

26%

20

72%

75%

60%

45%

42%

39%

39% 31%

20

62%

55%

80%

73%

72%

29%

LCL=25%

20%

N/A

7/

7/

1/ 8/ 201 1/ 6 9/ 201 1/ 6 2 10 /1 016 11 /20 /1 16 / 2 12 /1 016 / 1/ 201 1/ 6 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 20 18

0

1/ 8/ 201 1/ 6 9/ 201 1/ 6 2 10 /1 016 11 /20 /1 16 12 /20 /1 16 / 1/ 201 1/ 6 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 20 18

0

WGH Sepsis WIG—Best Practice Bundle, Sepsis/Severe Sepsis/Septic Shock Rate

WGH Sepsis WIG—Best Practice Bundle, Sepsis/Severe Sepsis/Septic Shock Rate

CAT INTERVENTION

CAT INTERVENTION

100

100 GOAL=74% 64% 51%

20

33%

40%

26%

41%

61% MEAN=40%

29%

1/ 8/ 201 1/ 6 9/ 201 1/ 6 2 10 /1 016 11 /20 /1 16 12 /20 /1 16 / 1/ 201 1/ 6 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 20 18

7/

196

40

62%

48% 40%

35% 38%

73%74% 72%

60%

69%

60%

39% 30%

34%

LCL=4%

0

75%

62% 60

20 18%

69%

70%

54%

40%

29%

27%

61%

UCL=73%

80

MEAN=36%

29%

21% 15%

18%

0 1/ 8/ 201 1/ 6 9/ 201 1/ 6 2 10 /1 016 11 /20 /1 16 / 2 12 /1 016 / 1/ 201 1/ 6 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 20 18

45% 40

63% 54%

85%

7/

60

79%

UCL=76%

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0.8

0.5

0.3

0.2

0.7

0.6

0.5 38% 38%

0.7 38%

0.6

0.9

1

0.9

38%

38% 38%

38%

0.4 38%

0.8

38%

38% 38%

38% 38%

38% 38%

38% 38%

38%

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38% 38%

38%

38% 38%

38%

38% 38% 38%

38%

GOAL=74% 1/ 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 4/ 201 1/ 8 5/ 201 1/ 8 6/ 201 1/ 8 7/ 201 1/ 8 8/ 201 1/ 8 9/ 201 1/ 8 20 18

1

1/

0.9 38%

38%

38%

38% GOAL=74%

38%

38% 38%

0

38%

1/ 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 4/ 201 1/ 8 5/ 201 1/ 8 6/ 201 1/ 8 7/ 201 1/ 8 8/ 201 1/ 8 9/ 201 1/ 8 20 18

1/ 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 4/ 201 1/ 8 5/ 201 1/ 8 6/ 201 1/ 8 7/ 201 1/ 8 8/ 201 1/ 8 9/ 201 1/ 8 20 18

1/

38%

1/

1/ 2/ 201 1/ 7 3/ 201 1/ 7 4/ 201 1/ 7 5/ 201 1/ 7 6/ 201 1/ 7 7/ 201 1/ 7 8/ 201 1/ 7 9/ 201 1/ 7 2 10 /1 017 11 /20 /1 17 12 /20 /1 17 / 1/ 201 1/ 7 2/ 201 1/ 8 3/ 201 1/ 8 4/ 201 1/ 8 5/ 201 1/ 8 6/ 201 1/ 8 7/ 201 1/ 8 8/ 201 1/ 8 9/ 201 1/ 8 20 18

1/

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FIGURE 3 .

WSH SEPSIS WIG BUNDLE COMPLIANCE LINE GRAPHIC JANUARY 2017 THROUGH SEPTEMBER 2018

Ephrata Community Hospital Good Samaritan Hospital

CAT INTERVENTION

CAT INTERVENTION

0.9

1

0.8

0.5

0.4

0.3

0.2

0.5

0.4

0.4

0.3

0.3

0.2

0.2

0.9

0.9

0

0

38%

0.7 38%

0.6

38% 38%

38%

0.9

Gettysburg Hospital

CAT INTERVENTION

0.8

0.7

0.6

38%

38%

38%

38%

38%

38%

38%

38%

38%

38%

0.9

38% 38%

38% 38%

38%

1

38%

38%

38%

38%

38%

38% 38%

38% GOAL=74%

38%

38%

0 38%

York Hospital

CAT INTERVENTION

38% 38%

38% GOAL=74% 38%

38%

38%

38%

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Utilizing the EHR has changed historical thinking and quality improvement possibilities compared to the traditional patient treatment approach. The customized EHR sepsis alerts “work”, not just because of the merit of the science of the algorithm, but because a new platform of care (not limited to “boots on the ground”) was established to receive and screen the alert, and constantly work with dedicated clinically prepared technical resources. These resources work to identify and resolve issues, customize or tweak thresholds or parameters based on real patient experiences, and spare interruption to the clinician. Other health systems routinely report “…we turned the alerts off…. too much alarm fatigue.”

Implementation of this new platform of care and innovative clinical support solution, has resulted in improvement in the quality of care we provide our patients.

The EHR and this new care model has allowed us to learn in new ways, beyond current limited linear and nonlinear learning. We have learned the evidence of sepsis and coded algorithms for early identification, when alert thresholds worked, did not work and best worked and adjusted, revised and customized learned thresholds/ algorithms and triggers, real time. And we continue to evolve as we become better prepared to predict patients most likely to recover, those more likely to relapse or deteriorate, and which patients are more vulnerable, or at risk. The EHR has provided the tools to support better, more timely, reliable care. The new platform of care; clinical and technical staff working together and leveraging the EHR, will transform the way in which that care is provided.

Additionally, WSH furthered the understanding of sepsis in our community by performing an analysis of Point of origin zip codes for sepsis admissions to York Hospital to ascertain if specific communities had higher admission rates. The initial analysis yielded two zip codes from which the highest number of sepsis cases originated, which also represent the most populous zip codes in York County and the hospital’s strongest core market geographies.

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The WellSpan Planning team was then asked to further analyze these zip codes to identify if there were specific neighborhoods that could possibly be targeted for prevention-geared interventions such as immunization against influenza and pneumococcal pneumonia.

The resulting heat mapping of patients’ originating addresses identified five “hot spots.” Although the initial expectation was that certain neighborhoods would demonstrate increased admissions, the hot spots overlapped skilled nursing facilities (SNFs). Compared to other zip codes in York County, the two zip codes analyzed had a disproportionate number of SNFs where concentrations of elderly and immunocompromised populations reside. Broader analysis of all York County zip codes confirmed that the highest rates of sepsis tend to occur in zip codes with multiple SNFs. When SNF sepsis admissions were removed from the target zip codes, rates of sepsis admission were like other large zip codes that did not have SNFs. Heat mapping was again performed using the “normalized” population, and new hot spots emerged. Interestingly, these hot spots coincided with assisted living facilities. These findings demonstrate that skilled nursing and assisted living facilities are key drivers of sepsis admissions in York County.

Prior to this heat mapping, WSH had already identified SNFs as a key partner in efforts to reduce sepsis mortality. In 2016, WSH PostAcute Services initially identified five preferred provider facilities, at least one in each market, with which it would collaborate on care improvement efforts. Sepsis was identified as a mutual area of concern, and SNF staff education on sepsis identification and early treatment were developed, such as education modules for both nursing assistants and clinical staff (RNs, LPNs). WSH shared this information with the SNF facilities using a “train the trainer” format, and offering a WellSpan clinician for on-site training to SNF “subject matter experts”, who in turn presented to their colleagues.

The modules were also made available electronically to facilities via WSH’s Learning Management System, so that this important training could be completed at any time.

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FIGURE 4.

(NEW FY) SEPSIS MORTALITY MAY, JUNE, JULY, AUGUST, SEPTEMBER 2018

Baseline Rate

YTDFY 19 Rate

YTDFY19 O: E

FY19 Target O: E

Top Decline

WECH

4.6%

2.27%

0.34

0.96 ❏

0.81 ❏

WGH

5.2%

2.59%

0.40

0.93 ❏

0.82 ❏

WGSH

9.0%

5.26%

0.68

0.96 ❏

0.81 ❏

11.0%

5.42%

0.69

1.02 ❏

0.89 ❏

WYH

Next steps include re-visiting the initial SNF cohort to develop individualized sepsis care pathways, to standardize their response to a potentially septic resident, and collecting data on hospital admissions/readmissions from partner SNFs. As additional preferred providers are added to the cohort, they will be offered the sepsis education program. Based on the findings of the heat mapping analysis, the Planning department also reached out to assisted living facilities in York County to raise awareness of sepsis.

Materials developed for distribution to residents include a onepage handout on “What you need to know about sepsis” and a magnet with a sepsis “zone tool” outlining symptoms of sepsis and how to respond.

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WellSpan has the vision to integrate Digital Science (technology) and Biological Science (best practice medicine) to augment Humanity—enhanced judgement through real time tools enabling the human elements of; empathy, ethical choices, personal choices, exceptions and a personalized approach across our continuum of care and into our communities. The BPAs and CAT described are our “Version 1.0”. Future versions may soon consider current alert algorithms to leverage machine-based learning/AI in support of more robust predictive analytics. These may then trigger orders from protocol driven smart order sets (whose foundation is evidence based), combined with local factors. These possibilities will further allow us to leverage humanity, providing the bedside teams more time with the patient. Given the early successes, the possibilities for similar future applications are limitless.

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COACH NURSING TEAM: RAPID RESPONSE TEAM WITH SEPSIS FOCUS

BY JOSEPH BROOKES, MSN, RN | Nurse Manager, Medical Intensive Care Unit, Tower Health MEREDITH DISKIN | Program Manager, Knowledge Transfer, AllSpire Health Partners

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Sepsis, Severe Sepsis and Septic Shock are complex and, in many ways, different clinical puzzles to solve. Many factors, beyond infection, play a role in identification, diagnosis and effective treatment planning. Where one patient may trigger an alert for sepsis intervention and be fine, another may be in a more severe state and trigger no alert or show outward signs of infection such as fever. Many health care providers are finding changes in a patient’s personal “normal” to be the greatest indicators of true sepsis versus a false positive due to other factors. So, how do clinical teams identify the right patient to turn the tide of impending doom caused by severe sepsis turning to septic shock and organ failure. Many hospitals are looking to their Epic teams to collaborate between IT, nursing and physicians to improve alert criteria and response training.

On September 7, 2018, the AllSpire Clinical Excellence Sepsis Initiative Team was invited to Tower Health’s Reading Hospital to discuss the Tower Health innovations in sepsis care, their ED clinical coordination and how they were expanding their sepsis focus to additional departments. Joseph Brookes, MSN, RN, Nurse Manager, Reading Hospital Medical Intensive Care Unit, Tower Health, reviewed the Tower development of both the analytics to trigger the alerts and the team developed to staff the alert response model.

The Reading analytical tool for Sepsis Predictive Index (SPI) captures 42 discreet clinical elements to create a sepsis risk score. This updates every 30 minutes. The Clinical Deterioration Index (CDI) Analytical tool captures 14 discreet clinical elements.

Scoring triggers were adjusted in Phase II of the Clinical Triggers implementation to reduce oversensitivity of alerts fired. Results found that the CDI scoring more frequently correlated with the patients’ actual condition. Patients found with an elevated CDI score (>70) were found to be cared for in the ICU and already monitored closely.

Phase II also evaluates the patients “normal” ranges to show changes rather than comparisons to average patient scores.

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COACH Nurses (Clinical Observation And Critical Help) review SPI and CDI Scores, respond to alerts and are scheduled each shift to specifically respond to patients in crisis. This staffing eased the burden put on ICU and MICU units that had been responsible for responding to codes and alerts while also scheduled to monitor patients in their unit. Now highly trained ICU, MICU, SICU and CCFP nurses are scheduled to identify critical patient needs throughout the hospital and critical care patients are fully supervised in place. COACH nurses respond to all MATT, Code Blue, and ERT calls throughout the organization. They also assist in rounding on all patients resulting from these alerts and are part of their follow up treatment plan.

TOWER HEALTH CLINICAL SCORING: DEVELOPING THE ANALYTICS THAT INFORM THE ALERT TRIGGERS FOR EPIC TOOLS

SPI SCORE VS. CDI SCORE

SEPSIS PREDICTIVE INDEX (SPI)

CLINICAL DETERIORATION INDEX (CDI)

Analytical tool that captures 42 discreet clinical elements to create a sepsis risk score

Analytical tool that captures 14 discreet clinical elements to create a sepsis risk score

Clinical data constantly running behind the scenes and updates the score at an interval determine by the organization—currently set at every 30 minutes

Clinical data constantly running behind the scenes and updates the score at an interval determine by the organization—currently set at every 30 minutes

Current sepsis score triggers • <3 = Low • 4–5 = Medium • ≥6 = High

204

Current CDI score triggers—none identified by Epic

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Results of evaluation of scoring:

• CDI scores more frequently correlated with the patient’s actual condition • Patients with elevated CDI (>70) were found to be cared for the ICUs • Frequency of posting scores was too frequent • Clinical parameters that were not repeated with a certain frequency led to falsely elevated scores

Decision to combine best of both scoring models to improve accuracy of alert triggers:

• Epic report revised to include both SPI and CDI as well as several demographic elements • Report now reflects 1st documented score, current score, and historical high score for every patient • Report reflects patient location

Phase II Trigger developed to alert COACH Nursing Teams: A. A COACH Nurse Alert will be triggered for SPI based on the following:

• Score ≥ 10 = High if greater than current MAX score within last 48 hours • Excludes patients that are currently cared for using the Sepsis Order Set • Excludes patients currently in ICU • Excludes patients on Comfort Care or Hospice

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B. A COACH Nurse Alert will be triggered for CDI based on the following:

• Score ≥ 51 = High if greater than current MAX score • Excludes patients currently in ICU

C. Excludes patient on Comfort Care or Hospice

• Coach role (ICU nurse) Clinical Observation And Critical Help • 24/7 Service staffed by RNs from MICU,SICU, and CCFP • Core group of critical care nurses • COACH is their assignment for the entire 12 hour shift • Nurses serve as COACH once per week • COACH nurses continue to work at the bedside all other scheduled shifts • Respond to all MATT and Code Blue calls throughout inpatient nursing areas • Rounding on all patients recently transferred out of the ICUs (within 24-48 hours) • Rounding on all patients who have experienced a MATT during the current hospitalization • Rounding on Med-Surg patients with elevated MEWS scores, elevated lactate levels, unstable vital signs

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Sample results*: Sepsis Index

Deterioration Index

News

Department

Room and Bed

Admsn Date

1st Sepsis Index

Max Sepsis Index

1st Deterioration Index

Max Deterioration Index

21

31

1

RH N4W

N422 01

08/23/18

1.1

23.8

0

59.1

19

66

5

RH T4

T4023 01

08/17/18

3

21.6

30

85.5

18

42

3

RH T4

T4012 01

09/06/18

1.3

34.3

0

55.1

18

76

2

RH T4

T4017 01

07/30/18

1

92

0

82.9

16

87

5

RH N4W

N440 01

09/02/18

1

27.3

0

87.8

15

35

1

RH N4S

N411 01

09/06/18

2.2

22.6

0

56

14

31

1

RH N5W

N531 01

09/06/18

1.6

13.6

0

32.9

11

39

3

RH T4

N4004 01 09/06/18

0.9

11.2

0

66

10

36

0

RH T4

N4104 01 09/06/18

1.6

14.3

0

46.6

8

46

8

28

8

RH C1S

C10701

05/12/18

1

72.7

27

63.8

1

RH N3S

N308 01

09/05/18

2.5

8.3

0

39.4

34

2

RH T3

T3013 01

09/05/18

1.1

8

0

44.3

7

40

1

RH C1S

C126 01

08/21/18

5.1

32

0

57.8

7

22

1

RH C1S

C114 01

09/04/18

3.1

12.4

0

36

7

25

1

RH C3S

C324 01

09/06/18

1

13.8

0

28.1

7

64

4

RH T4

T4020 01 09/05/18

0.9

6.5

0

67.5

6

53

1

RH N2S

N209 01

09/30/18

1.9

18.7

0

57.7

6

25

1

RH N5W

N537 01

09/05/18

1.4

16.8

0

36.5

Sepsis Order Set

* Identifying fields have been removed including DOB, MRN, Patient Name, and Age

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PHASE II COACH NURSING & SPI TIGGER RESPONSE TO ALERTS

A COACH Nurse Alert will be triggered for SPI based on the following:

• Score ≥ 10 = High if greater than current MAX score within last 48 hours • Excludes patients that are currently cared for using the Sepsis Order Set • Excludes patients currently in ICU • Excludes patients on Comfort Care or Hospice Joseph Brookes, MSN, RN Nurse Manager, Medical Intensive Care Unit

A COACH Nurse Alert will be triggered for CDI based on the following:

• Score ≥ 51 = High if greater than current MAX score • Excludes patients currently in ICU • Excludes patient on Comfort Care or Hospice Due to the success of the COACH Nursing teams and the accuracy improvement of the sepsis alert (an 80% accuracy up from 50%), Tower Health plans to implement similar alert criteria at its other 5 hospitals in the Tower Health System.

Future plans are underway at other AllSpire locations to further implement expanded analytics development to assist in identifying the truly at-risk patients, focus resources more effectively and develop similar alert teams where appropriate. Collaboration and shared learning within the AllSpire membership continues to provide overall improved care to the patients within the communities served by our member hospitals. Across AllSpire, there has been an average decline in mortality for both severe sepsis and sepsis with shock of more than 29%.

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T-MINUS SEPSIS CARE

BY DAVE PETERSEN, MSN, RN, CFRN, MICN | Manager, Quality, Education, & Accreditation for Atlantic Mobile Health / MARK BOBER, MA, NRP, FP-C | Director, JFK Medical Center EMS, Hackensack Meridian Health / MEREDITH DISKIN | Program Manager, Knowledge Transfer, AllSpire Health Partners

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In May 2018, clinical leaders from Atlantic Health System hosted the first AllSpire-wide site visit to share their program across all of the membership. The following is the learning shared by Atlantic Health System and JFK Medical Center of Hackensack Meridian Health System.

BACKGROUND—THE NEED FOR FASTER TIME TO TREATMENT FOR PATIENTS IDENTIFIED WITH EARLY SEPSIS INDICATORS

In 2014, Atlantic Health System identified the need for early interventions for patients diagnosed with sepsis. The ED clinical leadership introduced training programs and protocols for patients arriving at their hospitals meeting the criteria for sepsis treatment and evaluation. As a result, more patients survived and recovered.

However, sepsis continued to be one of the deadliest illnesses facing patient populations across the country. Time to treatment was showing the greatest impact to reducing sepsis-related mortality across all patient groups.

INTERVENTION PROGRAMS FOR THE PRE-HOSPITAL SETTING:

In 2015, Dave Petersen, MSN, RN, CFRN, MICN, Manager— Quality, Education, & Accreditation for Atlantic Mobile Health met with Emergency Medicine leaders at Atlantic Health including Christopher Amalfitano, MD, Chair of Emergency Medicine at Overlook Medical Center to develop an AHS system-wide Sepsis Committee with the addition of EMS stakeholders. Dr. Amalfitano invited Dave Petersen and his team to join the existing Atlantic Sepsis Committee to expand their communication to the EMS teams serving the health system.

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Initial evaluation of the Atlantic Health System needs yielded the following results: Initial focus [Symbol] Areas where EMS can impact CMS SEP-1 compliance:

• Early recognition prior to ED arrival • Early assessment of lactate • Beginning fluid resuscitation in the field EMS Challenges:

• Paramedic treatment rates for patients admitted for sepsis were already high (> 90%) • However, only a third of these patients received fluid resuscitation in the field • Most EMS agencies did not assess temperature due to lack of equipment • Criteria for sepsis identification & treatment were unclear Expanding Care Protocols for EMS teams: Atlantic Mobile Health implemented a multi-pronged approach to their Pre-Hospital Sepsis Initiative.

First, they developed a protocol for identification of suspected sepsis: Inclusion Criteria:

• Suspected or documented infection, and • At least two of the following: ❏ Fever of more than 38°C or less than 36°C ❏ Heart rate > 90 ❏ Respiratory rate > 20, or assisted ❏ Systolic blood pressure < 90 mmHg ❏ Serum lactate level > 2 mmol/L

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Second, ED and EMS developed a clinically-approved ALS treatment protocol: 1. Place the patient supine or semi-fowlers 2. Administer oxygen to maintain sp0₂ 94%–99% 3. Apply cardiac monitor: treat rhythm according to the appropriate protocol 4. Obtain a temperature and a lactate reading via the port for the IV line 5. Start two (2) large bore IV lines and hang a 500 ml or 1L bag of Normal Saline 6. Contact appropriate medical control site (activate "Code Sepsis" alert) 7. If the patient meets inclusion criteria, give a 500 mL fluid bolus.

The fluid bolus may be repeated after re-assessment, up to a total of 30 mL/kg Equipment Considerations: Temperature

• Most EMS agencies did not assess temperature • Many options for disposable or reusable thermometers Capnography (Waveform capnography represents the amount of carbon dioxide (CO2) in exhaled air, which assesses ventilation. It consists of a number and a graph. The number is capnometry, which is the partial pressure of CO2 detected at the end of exhalation. This is end-tidal CO2 (ETCO2) which is normally 35-45 mm Hg. An elevated EtCO2 level is typically an indication of hypoventilation or increased metabolic activity. A low exhaled CO2 level may be an indication of hyperventilation, decreased cardiac output or poor pulmonary perfusion, which can occur in shock.)

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• Decreased EtCO2 correlates with poor perfusion / metabolic acidosis • Combined with SIRS criteria, EtCO2 ≤ 25 mmHg is predictive of septic shock.

Lactate

(Lactate is a chemical naturally produced by the body to fuel the cells during times of stress. Its presence in elevated quantities is commonly associated with sepsis and severe inflammatory response syndrome. Serum lactate is an important indicator of the septic patient’s prognosis.)

• Combined with SIRS criteria, elevated Lactate is predictive of sepsis / septic shock • Pros: Rapid, point-of-care test Matches ED assessment, ease of communicating results May be used as initial Lactate for bundle compliance • Cons: Upfront cost of meters Requires vascular access CLIA license needed EMS scope of practice varies by state (i.e. allowed in NJ, but not in PA) What Atlantic Health System chose: (also used by HMH_JFK Hospital)

• Added disposable thermometer strips (Tempa-DOT®) Later transitioned to Welch-Allyn Sure Temp • Nova Bio-Medical StatStrip Lactate Meter

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The next focus on implementation of these protocols was the issue of documentation in the EHR. Documentation flow from EMS to Hospital ED:

• Communication from EMS to ED of sepsis-related care includes: Lactate level Total fluids given Vitals (HR, RR, Temp, etc.)

• Inclusion of EMS care within ED documentation • Access to EMS documentation (clinical staff, quality teams) • Report is printed by EMS staff and handed to ED clinical staff during transition of care hand-off ICS REPORT #

ARRIVAL AT HOSPITAL CODE SEPSIS ❏ Suspected Infection ❏ HR > 90 ❏ RR >20 or assisted ❏ SBP < 90 mmHg ❏ Temp < 36° or > 38° ❏ Lactate > 2mmol/L Temp = ❏ Oral

°C ❏ Axillary

Lactate =

mmol/L

❏ Sepsis Alert = Total Fluid Infused =

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RESULTS BEFORE EMS PRE-HOSPITAL SEPSIS INITIATIVE

AFTER IMPLEMENTATION OF EMS PRE-HOSPITAL SEPSIS INITIATIVE

Only a third of identified patients received fluid resuscitation in the field

Two-fold increase in pre-hospital fluid resuscitation since Sepsis Protocol was introduced (approximately 65%) ✔ Early recognition prior to ED arrival

Most EMS agencies did not assess temperature or Lactate in the field due to lack of equipment

✔ Early assessment of Lactate ✔ Beginning fluid resuscitation in the field

POA morality rates higher than expected

Top AllSpire performer in 0:E Mortality for Severe Sepsis (with and without shock)

Longer time to treatment (fluids and antibiotics) for patients

CMS SEP-1 compliance & reduction of time to treatment by approximately 60 minutes on average (in comparison to other hospitals)

SEPSIS ANALYSIS—BY DISCHARGE LIMITED TO SEVERE SEPSIS AND SEPTIC SHOCK ATLANTIC HEALTH SYSTEM NOT POA

POA

TOTAL

Fiscal Year

Cases

Mort. Rate (Obs)

Mort.

O:E

Cases

Mort. Rate (Obs)

Mort.

O:E

Cases

Mort. Rate (Obs)

Mort.

O:E

2016

240

43%

3.98

2,368

21%

1.10

2,608

23%

1.25

2017

189

46%

3.80

2,402

20%

1.04

2,591

22%

1.17

2018

219

41%

3.42

2,317

16%

0.82

2,536

18%

0.96

Dec 2018

22

27%

3.47

208

16%

0.84

230

17%

0.95

FYTD 2018

44

41%

5.02

622

16%

0.82

666

18%

0.94

Data Obtained from Vizient.

Includes ICD–10 codes R6520 and R6521 FFY=October through September

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For patients with a sepsis diagnosis that did not receive fluid resuscitation in the field, AHS evaluated the contributing factors.

Of the patients without fluid resuscitation, most (44%) were identified as meeting the protocol but had vascular access challenges. 15% did not meet the sepsis protocol at the time of the paramedics’ assessment. Another 5% either refused intervention or had end-of-life care in place that precluded aggressive treatment.

Future Challenges & Improvements: • All “missed” cases are reviewed by Quality Assurance Committee • Regular staff education to maintain protocol compliance • Continued collaboration with stakeholders

Implementation Planning: Keys for Success with EMS (Advice from Atlantic Health) • Involve EMS stakeholders early • Invest in equipment & training to support EMS recognition of sepsis • Devise a clear protocol for identifying sepsis, and initiating treatment • Documentation from EMS [Symbol] ED (i.e. lactate, fluids) • Feedback loops: patient outcomes, missed cases, false positives

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218

ALLSPIRE QUESTION RE: EMS SEPSIS INTERVENTIONS AT JFKâ&#x20AC;&#x201D;HACKENSACK MERIDIAN HOSPITAL

ANSWER VIA MARK BOBER, ASSISTANT DIRECTOR OF JFK MEDICAL CENTER EMS

Q1: Which products does JFK prefer (brand and product specifics for temp, testing or rapid lactate results)

A1. Nova Biomed's lactate meter is the only one approved for prehospital use. Aside from that, you would be talking ISTATE level

Q2: What training materials or communication do you use to implement this program with your EMS staff?

A2. We put together out own training with the help of our medical director and compliance people in the quality department of the hospital. We used CMS guidelines and SIRS criteria to create the framework in which we created our protocol.

Q3: Do you have some guidelines or documentation for your metrics reporting to show the analytics that would provide some justification for other health systems to go to leadership and show that this program works in helping reduce sepsis-related mortality by delivering care faster?

A3. We report on overall sepsis compliance through the ED's reporting lines. We are viewed as step one in the ED continuum of care, so we do not report our successes independently, but rather as a part of the overall hospital sepsis compliance picture. I'd be happy to go into this further with the help of Dr. Samuel LaCapra for any curious parties, should they ask.

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Percentage Compliant

JFKMC ED OVERALL SEPSIS COMPLIANCE PERCENTAGE JANUARY THROUGH JULY 2016 VS. 2017

100 90

88

85

80

75

67

70

71 65 56

60 46

50

45

40 30

88

56

38

26

25

20 10 0 January

February

March

Overall Sepsis Compliance % 2016

Overall Sepsis Compliance

Overall Sepsis Compliance % 2016

January

2/8=25%

25

February

6/13=46%

March

April

May

June

July

Overall Sepsis Compliance % 2017

Overall Sepsis Compliance

Overall Sepsis Compliance % 2016

January

8/12=67%

67

46

February

8/11=73%

73

5/11=45%

45

March

5/8=63%

63

April

3/8=38%

38

April

11/13=85%

85

May

5/9=55.6%

56

May

12/14=86%

86

June

5/9=55.5%

56

June

5/7=71%

71

July

2/8=25%

25

July

7/8=87.5%

88

Month/2016

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ED C.A.R.E.S. A Virtual Pressure Relief Value

BY ERIC BEAN, DO, MBA | Associate Medical Director, Connected Care and Innovation, Lehigh Valley Health Network / JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

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One of the biggest challenges for any emergency department (ED) is the variability of arrivals. While most ED’s staff to the average volume on any given day, it becomes stressed when a barrage of arrivals happens at the same time. Additionally, other events— weather, sporting events, seasonality -can drastically impact the arrivals and cause tremendous wait times and increase stress for both patients and providers, which can ultimately result in a number of patients that leave without being seen (LWBS). EDs track their LWBS metric—which is publicly available and has a real monetary impact on the health systems. Is telemedicine the answer to this ageold problem?

Several hospitals have tried to address two areas of “bottleneck” in the process triage and discharge. Triage – where you are registered and placed in the ED queue to be seen by clinicians - is a typical place where EDs have tried to place additional staff. In this model, a physician, nurse practitioner or physician assistant are part of registration and initial triage process and evaluate a patient soon after arrival. Seeing a provider speeds up the “when am I going to see the doctor” initial contact problem, but only helps with the process slightly. The provider will place preliminary orders, often very basic, and the patient is placed in a holding pattern while the care process from arrival through discharge moves at the usual slow pace. It also removes the provider from the “back” where care is delivered and progressed. If a barrage of patients hits the ED, it then causes a lot of patients with preliminary orders that are not progressing through care. Patients may opt to leave prior to receiving full treatment.

Photo (Left): Dr. Jennifer Rovella—Chief, Critical Care and Medical Director, AICU.

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New York Presbyterian in New York City has used virtual providers to enhance efficiency around discharging patients. Once a patient’s disposition is determined to be discharge to home, they leverage virtual physicians to complete the process. This helps relieve the discharge bottleneck , but if it is a busy ED, it can be a Band-Aid to a bigger problem. As Eric Bean, DO, MBA, Lehigh Valley Health Network’s (LVHN) Medical Director, Community Health and

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Associate Medical Director, Connected Care and Innovation, states “If it is busy in the front, it is busy in the back and you need to have visualization to the entire continuum of care in the ED to support optimized throughput efficiency.”

Enter ED C.A.R.E.S.—LVHN’s solution to a vexing problem. Led by Bean, this initiative helps support the ED teams no matter where a logjam may occur. His vision was to provide a model where each phase of a patient’s journey is supported by a remote clinical team– from arrival in the ED, triage, diagnostic evaluation and through final disposition—be it admission to the hospital or other facility or discharge to home. “C.A.R.E.S.” stands for “Continuous Ambulatory Remote Engagement Services” and is a team of providers and nurses that support patients in a virtual fashion - either in the hospital, at home, or in this program, in the emergency department.

Located at LVHN’s 2024 Lehigh Street Telemedicine Center, this team of fully trained ED providers and nurses has a dashboard in Epic, the health system’s electronic health record, of all the ED departments in the health system. They can quickly assess where there is need and connect with the team onsite to begin their virtual work. The providers are able to remote in and engage with the patients via an iPad and perform many of the tasks that a provider or nurse would with the patient in person. Patients are asked at triage if they would be interested in seeing a do virtual provider “right now” by one of the telemedicine providers, or if they would want to wait for traditional in person providers. Most times, the patients opt for the virtual provider.

These providers can perform review of systems, begin the initial notes and place orders. But they do not stop there. They are also able to work in tandem with the onsite providers and nurses for exams using peripheral devices. The onsite providers will augment the virtual providers evaluation by performing a targeted hands-on exam. The patient will continue their care utilizing the virtual provider. This will include: ordering meds, monitoring labs,

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x-rays and other tests - until discharge, depending on capacity.

Discharge preparation includes all tasks from documentation, follow-up care recommendations, and e-prescribing or printing out a prescription for the patient. If a patient is sicker than initially thought, the virtual provider will transition the patient to an on-site provider. Additionally, the virtual provider has the ability to work as a scribe while the onsite provider performs the physical exam for the patient if needed.

Bean reports one of the stumbling blocks they encountered early on was that they only started with virtual physician level providers â&#x20AC;&#x201D;and not virtual nurses. For the on-site nurses, the patient care flow went from a one lane highway to two and doubled the work and orders for the ED nurses to execute. They quickly realized that they needed to add virtual nurses to help support triage, documentation and review of studies to help smooth out the work that was being generated by the virtual provider team. Adding the virtual ED nurses allowed the onsite nurses to spend more time with the patients at the bedside.

The ED C.A.R.E.S. program then added language and interpretation services. Using existing video technology and LVHN staff they were able to link interpreters to patients and the clinical team on the same iPad. At any given instant, a patient may see a picture of themselves, the nurse, the provider as well as the interpreter. An additional benefit to the interpretation service was that there was more continuity than a traditional language line service, as the interpreters are familiar with the patients and it was faster to access in-house interpreters with the new iPad program.

Currently, the program is in use at LVHNâ&#x20AC;&#x2122;s 17th Street campus and the team has begun testing at LVHNâ&#x20AC;&#x2122;s Muhlenberg site. While the program has been up and running for less than six-months, Bean reports they have less than 5 percent of patients declining engaging with virtual providers and nurses. Additionally, an early surprise outcome was that pediatric patients seen in the ED really

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liked using the virtual provider platform and this sets them at ease for the onsite provider examinations.

There are plans for rapid expansion to Cedar Crest, the main campus, and eventually to all LVHN EDs once they are converted to the same electronic health record. In the future, as the program matures, Bean envisions a seamless rolling queue that could move patients to multiple providers and nurse all housed at the ED C.A.R.E.S. center. Since some of their sites can be greater than an hour driving time apart, virtual care is an excellent way to optimize resources. The team can help with the LVHN video visit program (urgent care patients) if there is no demand from the ED. He also thinks virtual scribes may be added to the mix. â&#x20AC;&#x153;We anticipate lower than usual LWBS rates, and our goal is by 2019, all our sites will be leveraging the service. We now have the playbook to roll this program out rapidly. The word is out that the service is really efficient and works.â&#x20AC;?

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TELESPECIALTIES Stretching Resources Across The Health System And Beyond

BY JOE TRACY | VP Connected Care & Innovation, Lehigh Valley Health Network JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

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At Lehigh Valley Health Network (LVHN), a clinical provider shortage is sometimes addressed by using connected care services.

When hospitals need a specialist that is not available in the local area or a specialist who may be on leave, they look to the connected care team at the Air Products Center for Connected Care and Innovation (CCCI) at LVHN to help fill the void. Joe Tracy, the Vice President of Connected Care and Innovation states “It always starts with the identification of a gap that needs to be filled and then we work with all stakeholders to carefully develop a connected care program that will meet the need and close the gap.” The goal is to allow patients to safely remain at their local hospital and receive high quality care instead of being transferred further away from their homes to a larger facility. The first step is to assemble the clinical stakeholders who will provide providing the connected care services (often at practice locations) and the clinicians who will be working with the patients at the remote location. Involving all keystakeholders upfront is key to developing a connected care plan and operationalizing it to the benefit of the patient, the clinicians and the institutions involved in the program.

It should be noted that Pennsylvania is a bit unique compared to all other states when it comes to connected care. Specifically, hospital based connected care programs must submit one of the following notices to the Pennsylvania Department of Health (PaDOH) before starting a service: 1. I f a proposed connected care program addresses a service that is not listed on the hospital’s license, a 60-day notice requesting to start a new service must be sent to PaDOH. After the 60-day period, a PaDOH Surveyor will conduct a review of the program and make a determination if the hospital is ready to provide the service.

2. For a service that is already listed on the hospital’s license, a courtesy letter indicating that the identified service will begin using connected care technologies should be sent to PaDOH.

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Regardless if connected care is being used to fill a gap or provide a permanent service, there are many steps to executing the plan and operationalizing the program. This includes, but is not limited to, involving the respective staff from each hospitalâ&#x20AC;&#x2122;s department of information technology, compliance, nursing, medical staff, legal, credentialing, billing, purchasing and general administration. Each will play an important role in the development of the program.

After 25 years of directing connected care programs, Tracy suggests that the following two facets of a program cannot be over emphasized. The first is for the site receiving the service to identify multiple patient presenters that are passionate about using technology to appropriately care for patients in their facility. Connected care functions must be written into the job description of these individuals, so that it becomes a formal part of their position and annual performance review. The second, is training the presenters so that using the equipment and interfacing with the distant medical providers becomes second nature. A program that has patient presenters that are passionate and welltrained will create an environment that will be efficient and create a satisfying experience for everyone involved, especially the patient and/or their family.

A few of the specialties that are leveraging video consults at LVHN are infectious diseases, neurology, pulmonology, cardiology and psychiatry/behavioral health. Active since 2011, the TeleInfectious Diseases program has seen over 4,000 cases.

A retrospective review of the 1,905 cases from Lehigh Valley Hospital Hazleton has shown a significantly reduced cost for antibiotic utilization and a significant reduction in length of stay.

In addition, the program has resulted in keeping approximately 95% of the patients at Hazleton, producing an estimated savings of $1.6 million in avoided interfacility patient transports. In spite of the ability to provide quality patient care while reducing costs, the Medical Assistance program and most commercial insurance carriers in Pennsylvania refuse to pay for these infectious diseases

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services, as well as other connected care services that produce similar results.

Currently connected care services are not widely reimbursed in Pennsylvania and that is stifling the expansion of connected care programs that could save the global healthcare system millions of dollars, as suggested by just the one example of LVHNâ&#x20AC;&#x2122;s TeleInfectious Diseases program. When it comes to gaps in existing services, it should be specifically noted that the only option a hospital may have is to transport a patient to another facility if the gap is not filled in a timely manner either. Thus, reducing the burden on the patient/family and reducing the cost of patient transportation is yet another reason that all public and private sector insurance companies should reimburse for connected care services as if the service were provided in-person.

With the success of the previous connected care services, other specialties at LVHN are getting involved. For instance, Palliative Medicine and inpatient Psychiatric consults, as well as the use of connected care to facilitate surgical discharges will all launch in the first few months of 2019. All of these services fill a gap or provide a service to a hospital that has not been able to provide that service in the past.

Connected care services are here to stay. They are a perfect example of the triple aim of providing better health, better care and reducing costs. Connected care provides the right care, at the right time, in the right place and at the right cost. Even the nationâ&#x20AC;&#x2122;s largest insurance carrier, Medicare, is realizing through their experience and recent approach to reimbursement, that using connected care is simply a tool to provide medical services at a distance, especially to areas that are underserved. Something that those of us working in connected care have been saying for 25 years. Now the other payers need to adopt a similar position so that connected care services can grow vs. being capped themselves, due to lack of reimbursement.

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Reimbursement Hurdles

While there has been remote monitoring of patients in some capacity since the early 1970’s, reimbursement for these services has been slow to develop.¹ In January 2015, The Centers for Medicare & Medicaid Services (CMS) issued a rule to allow for reimbursement of remote (non-face-to-face) chronic care management (CCM) services for patients with multiple chronic conditions.

Eligible providers include physicians, nurse practitioners, physician assistants, registered dietitians and others. In January of 2017, CMS adopted a new telehealth specific place of service (POS) code for providers to utilize to indicate that the service took place via telehealth to help track telehealth utilization and spending.² Finally, in January 2019, CMS ruled that it will reimburse for installation of remote monitoring equipment, payment for the nurses that perform the remote patient monitoring, and also payment

to licensed providers for their work in reviewing the patient’s data monthly.

CMS is now viewing these services as true healthcare, not just “telehealth” services. Unfortunately, many states and other insurers are slow to adopt this view of telehealth. In the Commonwealth of Pennsylvania remote patient monitoring and many other telehealth services are still not viewed by the Medical Assistance Program or most private insurance companies as reimbursable healthcare services.

However, that is not preventing some private insurance companies from providing their own telehealth services to their beneficiaries. According to Joe Tracy, “If and we become a completely value-based health care system, remote patient monitoring will flourish with the intent to keep patients healthy at home.

Until we reach that point, this will need to be reimbursed under the traditional payment models.”

Sources: 1. Gruessner, V. The History of Remote Monitoring, Telemedicine Technology. November 9,2015. https:// mhealthintelligence.com/ accessed January 4, 2019.

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2. Center for Connected Health Policy Fact Sheet. The National Telehealth Policy Resource Center. https://www.cchpca.org/sites/ default/files/2018-09/CY%202017%20 Final%20Fee%20Schedule%20Fact%20Sheet. pdf accessed January 4, 2019.

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LVHN C.A.R.E.S.

BY LORRAINNE VALERIANO, BSN, RN, CNRN | Director of the Advanced Intensive Care Unit (AICU) and Remote Patient Monitoring (RPM), Lehigh Valley Health Network / JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

In July of 2018, Lehigh Valley Health Network (LVHN) launched the Continuous Ambulatory Remote Engagement Services (C.A.R.E.S.) center. The center is led by Deb Salas-Lopez, Chief Transformation Officer at LVHN. By leveraging digital technology, the center works to connect and engage patients in ways, and at times, that they prefer. This high-level engagement is helping the C.A.R.E.S. center to support LVHN patients post discharge from their hospitals. Leadership determined there was an opportunity to further synchronize critical transition services in order to provide a coordinated safety net for their patients. Ultimately, this program helps reduce readmissions, continues to reinforce patient education, and keeps patients where they want to be­â&#x20AC;&#x201D;home.

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Pictured (from left to right) Deborah Sipos, RN Mindy Brosious, RN Corinne Solt, RN Lorraine Valeriano, RN Emily Joyce, RN Nicole Spess, RN Dr. Eric Bean Melisa Kubic, RN Tammy Poust, RN Joseph Tracy, VP CCC&I Kelly Adams Andrew Hunadi, PA-C Andrea Nansteel, RN

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Lorraine Valeriano, BSN, RN, CNRN, Director of the Advanced Intensive Care Unit (AICU) and Remote Patient Monitoring (RPM) programs states, “It is a virtual care center designed to bring together the resources needed to support recently discharged patients to continue their care at home. We strive to help them understand their illness and engage with them to promote self-care.

This program also provides a vital window into what is happening within their home environments”.

Today, the C.A.R.E.S. Center centralizes the following services: • An Advanced Care Intensive Care Unit which oversees 140 ICU beds remotely for LVHN hospitals • The Remote Patient Monitoring Unit which monitors the vital signs and biometric data of high risk patient identified by Populytics (our data analytics company) using technology deployed to the home

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• Care Transition Teams consisting of RN Care Managers and Pre-engagement Specialists who call certain patients within 1-2 days post discharge from the hospital to ensure transitions are smooth. These post-discharge phone calls involve scheduling of follow-up appointments, review of discharge instructions, and medication reconciliation, • Video Visit services with providers that treat low acuity conditions 24/7/365 for pediatric and adult services within EPIC, • Emergency Department Virtual Triage, our newest service for triaging patients who present to our emergency rooms to facilitate triage and disposition.

The goal of LVHN C.A.R.E.S. is to improve care across the continuum, reduce unnecessary utilization and costs, and improve the patient experience. Using data analytics provided by Populytics, LVHN C.A.R.E.S. directs the resources within the center to the patients that could benefit the most from its services. As an example, the remote patient monitoring team, working in conjunction with the care transition team, is targeting high risk congestive heart failure patients recently discharged from the hospital with a focus on patients attributed to one of our accountable care arrangements.

The Care Transition team members connect via telephone with recently discharged patients (typically within 1–2 business days) and using an algorithm evaluate if the patient is a candidate for the (RPM) program.

When speaking with the patient, the coordinators share the benefits and goals of RPM, like supportive education to remain at home and prevention of a hospital readmissions. RPM is then initiated by protocol for all amenable patients

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Often, many patients are surprised that they are getting a phone call from the hospital to see how they are doing after discharge, and even more surprised to learn about the RPM program.

Lorraine Valeriano states, “It is a great way to ensure all the patient’s needs are met, that they are getting to their follow-up appointments and patients are happy that they have a team looking out for them”. The RPM staff focuses on coaching patients, providing education, and reinforcement of discharge instructions with a focus on medication adherence, diet, activity, and daily vital measurements. They also help patients identify key indicators that may require a provider’s intervention.

One of the most valuable components of the program is the transmission of daily vital sign data to the RPM nurses. When patients are enrolled, they receive a scale, blood pressure monitor, and pulse oximeter along with a modem for transmission of these readings. Nurses evaluate day to day trends to detect early warning signs and symptoms that may require an escalation to a provider for early intervention. For example, should a patient report increasing ankle edema and shortness of breath and be found to have a weight gain of 3+ pounds in one day, the nurses in the C.A.R.E.S. center will notify the patient’s cardiologist for further review and intervention, as indicated.

Today, the RPM services of LVHN C.A.R.E.S. has touched over 500 patients and has an average a daily census of 350 or more heart failure patients. Over the last 2 months, the new collaboration with the care transition team has shown reductions in CHF readmissions from 24% to 16%.

The creation of this new center holds promise for achieving better care at lower costs. “By targeting the patients that need this virtual support the most, we hope to engage our patients across the continuum so that we can ultimately impact their health over time” said Valeriano. We also plan to analyze the data from patients cared for by the center to demonstrate improvement in patient

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outcomes and a reduction in costs over time. “We are redesigning care delivery using data analytics so that we can engage the right patients to improve their care, reduce costs, and ultimately improve their health” said Salas-Lopez.

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MEDICAL NEIGHBORHOOD: An Innovative Program For Patients With Heart Failure

BY WALTER BOHNENBLUST, MD | Director of Utilization Review, Tower Health / DAWN DREIBELBIS, MSN, RN, CCM | Director of Population Health Management, Tower Health / GREG SORENSEN, MD | EVP & Chief Medical Officer, Tower Health / SID K ANDAN | CEO, Stel Life / JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

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Leadership at AllSpire Health Partners (AHP) often learns of innovation in many ways. Sometimes, it happens on a neighborhood sidewalk. JoAnne Resnic, AHP’s VP of Collaborative Initiatives, met Sid Kandan, a young entrepreneur at a Philadelphia block party who has set out to help make the exchange of remote monitoring data easier for both patients and clinicians. Sid’s company, StelLife, provides an affordable platform to monitor patient vital signs, weight and glucose with a goal to increase patient adherence and provide higher quality data to providers.

Stel’s Bluetooth enabled “Hub” allows for patient home monitoring devices - scales, blood pressure cuffs, glucometers, pulse oximetry to be seamlessly integrated into one dashboard for tracking of fluctuations and indicators that may impact clinical conditions. The system only requires the patient (or family member) to be able to plug the Hub into an electrical socket and the Hub does the rest.

Registered nurses monitor the dashboard remotely on a daily basis to ensure that patients check their vital signs by a pre-determined time and look for vital signs that are outside of set parameters.

The nurses currently manually add the vital sign information to the patients’ medical record, so the clinician can scan and track their home monitored patients. The vital sign data can be integrated to any electronic health record (EHR), eliminating the manual entry.

Seeing this as a great option for the AllSpire member health systems as well as a potential revenue generator (new CMS codes allow for reimbursement for set up and ongoing interpretation of health data) the AHP leadership team shared this new technology with several interested members. After meeting with the Stel team and seeing their platform, Greg Sorensen, the chief medical officer for Tower Health, enthusiastically agreed to pilot the service in their flagship Reading hospital with a cohort of chronically ill patients.

Dr. Sorensen states, “While it is a very promising new, cost effective and intuitive technology, it does not place a large burden on the health system infrastructure”.

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“ It’s a pleasure to be a part of this highly professional and motivated team to put together a program designed to help heart failure patients avoid readmissions to the hospital. At times it can be a daunting task to take on as these patients are not always motivated to help themselves stay “healthy”. I’ve met with multiple candidates who do appear motivated to stay out of the hospital and all thought the program was a great idea. One or two have even commented that they were “happy to have someone watching over them to keep them stable. It does require commitment on the patient’s part to follow through with use of the equipment and a willingness to communicate with the care navigators and PCP offices. I think this program will offer the candidate the best possible chance to live well with their heart failure.” —Tower Health Hospitalist Team While remote patient monitoring for the chronically ill is not necessarily new, lack of radical improvements in cost, simplicity of use and reimbursements has held back wide-spread use. The goal of this small pilot was to validate the performance of the Stel platform as a tool for management of chronic care disease, gain feedback on integration of this data into practice and Case Manager’s workflows, provide insight into CMS reimbursement for remote patient monitoring and realize additional revenue for primary care practices participating in the trial. The health system signed a one-year trial agreement with Stel and began work on assembling a team to help launch the project.

The pilot was spearheaded by Dawn Dreibelbis, MSN, RN, CCM Tower’s Director of Population Health Management, and Walt Bohnenblust, MD, the Director of Utilization Review, with Greg Sorensen, MD serving as the executive sponsor. They knew the patient population they wanted to target - Congestive Heart Failure Patients (CHF) - and had an inpatient physician lead - Liz Dohan DO, the medical director of the transitional sub-acute unit - to help support the inpatient workflows with several clinicians participating in the program development (hospitalists, primary care, cardiology,

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and post-acute). The project team consisted of care managers, social workers, nurse practitioners, information services project managers and analysts, billing staff and many others. Additionally, the team leveraged their health systemâ&#x20AC;&#x2122;s relationship with the community paramedics who were trained to perform the initial inhome set-up visits for the patients newly discharged with the StelLife Hub, blood pressure cuff and scale.

Workflows were developed around identification of patients, order entry for the remote monitoring, obtaining consent, setting up the units for each patient, warm handoffs to the primary care physician through secure text, coordination between the inpatient care management team on the inpatient heart failure unit and the ambulatory care managers, transitioning to paramedics for the initial home visit as well as ongoing case management of the patient, and protocols for when to intervene with remote treatment of the patient (e.g. instruct patient to take a dose of a diuretic when there was a critical weight gain).

Here is some of the feedback from a few of the population health care navigators: â&#x20AC;&#x153; The first patient on this pilot has mentioned to me numerous times that she really enjoys this program. She stated she likes the daily monitoring because it feels like someone is watching her. She has not been the most compliant in the past with her diet and last week she actually called in to inform us that she almost reached her fluid allotment for the day and was looking for recommendations. I think by having the monitoring system in her home, it has made her think about her diet/fluid choices more than she did previously. She frequently calls us as well, so the frequent education/encouragement also helps her.â&#x20AC;?

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â&#x20AC;&#x153; A reoccurring theme we have been hearing is that patients appreciate the connection with their providers, without having direct communication. They feel safer knowing someone from their care team is monitoring their values on a daily basis, which I believe has improved compliance in some patients. I have even had a patient call me to discuss times in which she has not been most compliant, prior to her values proving so.â&#x20AC;?

Some stumbling blocks were identified by the team that needed to be sorted through. While the ultimate goal was to automatically have data directly integrate to the EHR leveraging the ease of Fast Healthcare Interoperability Resources (FHIR) protocol, it was dependent on the version of the platform the health system had installed. After some time trying to make this work, it was discovered that the EHR version could only use the standard HL7 protocol.

The recommendation is for Stel to work with Epicâ&#x20AC;&#x2122;s Orchard App to integrate information from the dashboard into the EHR. Both the Stel team and the Tower IS teams are working towards this data integration as the pilot moves forward.

Another glitch arose around the agreement that had originally been signed between the hospital and the vendor. The compliance team recommended that the agreement be revised to be with the physician group since it is an ambulatory driven program and our physicians would be billing for the RPM codes. The agreement was reworked to be signed by the physician group but included the roles and responsibilities of the hospital and the vendor.

With several patients enrolled in the program the health system is very hopeful this will support their efforts to help their CHF patients manage their health and intervene as soon as possible before a fluctuation becomes and admission. While early in the pilot, the comments from patients, care managers and providers has been quite positive. With over 2,500 measurements collected from patients to date, the team believes they have averted at least

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20 readmissions. Additionally, the Stel system is over 5 times less expensive compared to other options on the market, and thus the program is quite scalable for this and other disease states. There is high interest in expanding this pilot to other hospitals in the Tower Health System. Dr. Sorensen says, “I am very impressed with the hard work and collaboration between the Tower project team and Stel Life. It has been a true partnership. We had a very short timeframe to launch and we are quite proud of the team’s efforts to resolve issues quickly to produce early wins. We anticipate more success with this program.”

STEL SAMPLE PATIENT DASHBOARD

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Photo (Right) Mary Solyntjes Executive Administrative Coordinator, PHM Dr. Walter Bohnenblust Medical Director Utilization Review Sid Kandan, CEO Stel Life Jon Pry, CTO Stel Life Anthony Martin ED EMS Outreach Coordinator Chris Budig Program Manager Telemedicine Jason Balthaser Coordinator Applications Dawn Dreibelbis Director, Population Health Andrea Machemer Care Navigator, PHM Olivia Shaffer Population Health Management Adrien Courdavault Vice President of Engineering—Stel Life Abby Kasper Social Worker Care Management Vera Gardner Case Manager Medicus Tom Pepe Project Manager

Also part of the project team, but not pictured:

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Brian Kane MD Physician—Kenhorst Family Medicine

Kimberly Olszewski Record Supervisor, Scanning

Ronald Herb DO Physician—Berkshire Heights

Mike Wentzel Systems Analyst

Jeanne Venella Vice President of Clinical Operations—Stel Life

Matthew Nixon Systems Analyst

Donna Baer RN Case Manager

Helen Dunkle Coordinator Systems Applications

Megan Muscarnera Nurse Practitioner

Tabetha Dougherty Systems Analyst

Irvin Blankenhorn Community Paramedic Coordinator

Ann Schmehl Case Manager Medicus

Michael Korman Systems Analyst

Robin Riegner Manager Population Health Mgmt

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USING REMOTE PATIENT MONITORING TO SUPPORT POPULATION HEALTH OBJECTIVES

BY MELISSA PIERCE, MPT, MHA | Director, Continuing Care Services, WellSpan Health

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The Center for Connected Health Policy tells us that telehealth is a collection of means or methods for enhancing health care, public health, and health education delivery and support using telecommunications technologies. Telehealth encompasses four distinct application domains: Store & Forward (transmission of recorded health information such as imaging), Remote Patient Monitoring (RPM), Live Video, and Mobile Health. With RPM, personal health and medical data is collected from an individual in one location via electronic communication technologies and transmitted to a provider in a different location for use in care and support.

WellSpan Health has been providing RPM services to patients for almost twelve years. This year, WellSpan’s newly branded Connected Care at Home team added live video and mobile health to its RPM strategy to improve clinical efficacy and overall patient experience. Video offers live interaction between Connected Care clinicians and remote patients. Mobile health (cell phones, smart phones, and tablets) is a key ingredient in WellSpan’s remote monitoring formula and will be increasingly important in WellSpan’s population health strategy.

THE REARVIEW MIRROR

Image on left Similar to drivers, clinicians use dashboards everyday to navigate a patient's healthcare journey

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The Centers for Medicare and Medicaid Services (CMS) have not historically provided reimbursement for RPM. To dampen the financial loss associated with providing RPM, only patients meeting homebound criteria were deemed appropriate RPM candidates in the past because they would receive monitoring as a service complementary to their Home Health episodes.

Another backward glance would reveal that WellSpan historically provided RPM primarily to patients with Congestive Heart Failure (CHF) and surgical patients post-Coronary Artery By-Pass Graft or CABG.

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A typical RPM episode of care would begin for a CHF patient following an acute stay. The patient would remain on service approximately 60 days until he demonstrated medical stability, at which point the episode was terminated and the RPM equipment would be removed, cleaned, and passed on to the next patient.

Because CHF is a chronic disease, it would just be a matter of time before this cycle would repeat.

CHANGING GEARS

WellSpan puts patients first - always, so this cycle of giving patients RPM equipment only following an acute care stay and then removing it as soon as they improved was a process that was ripe for change. What is it they say about the definition of crazy? It is doing the same thing over and over and expecting a different result.

We made a conscious decision to break this cycle.

The implementation of a new RPM solution allowed for care delivery improvements that were desperately needed. These novel capabilities have provided the framework for the RPM service changes, but the impetus for them was the desire to support a broader population health strategy. The new technology married with the population health mindset has broadened the types of patients meeting WellSpanâ&#x20AC;&#x2122;s RPM inclusion criteria. On the acute end of the spectrum, CABG and CHF patients still greatly benefit from RPM, but so do patients with diabetes, chronic obstructive pulmonary disease (COPD), pneumonia, sepsis, and many other polychronic patients trying to prevent return trips to the hospital. On the wellness/preventive end of the spectrum, remote monitoring is being considered for ways in which it can benefit patients who are self-managing and/or have other early chronic disease states.

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To closely align with WellSpan’s Population Health Services and, more specifically, its Accountable Care Organization (ACO) strategy, Connected Care at Home has partnered with its Director of Government Risk Contract Programs to identify specific ACO measures on which the Connected Care team will focus its efforts.

There are three active ACO measures with which Connected Care at Home is strategically aligned: ACO 8: Risk-Standardized All-Condition Readmission

• Connected Care at Home deploys diagnosis-specific pathways to patients. These daily pathways are used to check vital signs and ask questions pertaining to patients’ health. These questions are presented to patients in the form of branching logic and focus on how the patients are feeling and probes for patient symptoms. Patient responses to the questions generate no, low, medium or high-risk calculations, which affect where the patients appear on the clinician dashboard based on risk algorithm scores. This intervention leads to fewer unplanned admissions.

• The Connected Care nurses receive this information and collaborate with providers regarding abnormal biometrics or information received aiding in the prevention of readmission for all conditions.

ACO 14: Preventive Care and Screening: Influenza Immunization • All RPM patients receive a pathway asking if they’ve received their flu shot and are prompted to contact their providers if they still need to get one.

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ACO 28: Controlling High Blood Pressure • All pathways deployed to RPM patients require a blood pressure reading be taken using the blood pressure cuff provided to them. Additionally, diagnosis-specific pathways provide written education and/or videos pertaining to high blood pressure.

By reviewing the data received from the patients’ tablets daily, Connected Care nurses can monitor remote patients and contact the appropriate provider when the biometrics are abnormal.

CMS has retired some of its 2018 ACO measures. Nonetheless, the Connected Care at Home team will continue to focus on a few of these measures deemed important because doing so will help WellSpan perform better with respect to ACO 8: Risk-Standardized All-Condition Readmission.

There are three retired ACO measures with which Connected Care at Home is strategically aligned: (Retired) ACO 36: All-Cause Unplanned Admissions for patients with Diabetes • Deploying a pathway specific to patients with Diabetes, Connected Care nurses can monitor patients for abnormal blood sugar readings and other diabetes-related health issues, as well as provide educational health tips and videos.

(Retired) ACO 37: All-Cause Unplanned Admissions for patients with Heart Failure • Remotely monitored patients with Heart Failure receive a pathway specific to their condition. This pathway contains educational information in the form of health tips and videos, as well as questions pertaining to the Heart Failure diagnosis. This intervention leads to less unplanned admissions.

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(Retired) ACO 38: All-Cause Unplanned Admissions for Patients with Multiple Chronic Conditions â&#x20AC;˘ Remote Patient Monitoring patients can receive pathways for multiple diagnoses. Connected Care nurses monitor these patients daily and intervene as needed to help decrease unplanned admissions.

When the patient appears to be at risk for an unplanned admission, the Connected Care team contacts the provider, allowing for early intervention and possible prevention of a hospital admission.

THE WINDSHIELD

Take experience, add a little innovation, a sprinkle of generosity, and a dash of population health, and you get WellSpanâ&#x20AC;&#x2122;s new RPM strategy. The road map is very clear.

Acute patients will receive their RPM kits just prior to discharge and, on post-acute day one, will begin a clinician-guided journey to self-management. During Phase I (15-30 days), patients will be on a fully managed, blue-tooth RPM kit. Daily, when patients take their vital signs, they are automatically transmitted to the Connected Care team.

Beginning in Phase II, we change the way we engage with patients.

In the past, we would remove RPM equipment and often leave patients without the tools necessary for managing their chronic diseases. Today, patients experience an entirely different journey.

In Phase II (15-30 days), the Care Team deploys an equipment survey to patients to see if they own any of their own equipment needed for taking vital signs and chronic disease management. If there are equipment gaps, patients are prompted to close those gaps in preparation for self-management. Through questioning, the Care Team can determine if a patient is not willing or able to

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purchase the equipment needed for self-management. For high-risk patients, it makes sense to close the equipment gap for patients who can’t afford to do so for themselves and help prevent readmissions and unplanned admissions.

Prior to advancing patients to Phase III, a member of the Connected Care team will: • confirm the patients have all necessary equipment, • explain the purpose of the Bring Your Own Device (BYOD) Phase (which is to promote independence with self-management of chronic disease), and • confirm the patient agrees to participate in BYOD. Once patients meet the criteria above, steps are taken to pick up the bluetooth RPM kit, and the patients are transitioned to the BYOD Phase of RPM. A link is sent to patients’ mobile devices where they can continue their monitoring with no break in service.

Phase III (30-120 days+) begins the BYOD Phase. During this phase, patients use their own equipment, take their vital signs and enter them daily into the care portal, where they continue to be received and monitored by the Connected Care at Home team. Only when patients are confident and competent with selfmanagement, they demonstrate their chronic disease is being well-managed, and their primary care physician agrees, do we discharge from RPM. The shifting strategy that teaches patient self-management as part of a BYOD solution is the same strategy that no longer sees RPM as only being an adjunct service to home health. Providing patients with knowledge and capability is key to reducing cost for our ACO.

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WHAT’S AROUND THE BEND?

More support for WellSpan’s shifting RPM strategy is data-driven.

ACO claims and predictive modeling have given us a ‘GPS’ of sorts that will guide our RPM journey, so we can confidently focus on the right patients. Historic primary care, urgent care, emergency department, and inpatient utilization serve as predictors of risk and future utilization. Viewing claims data first historically and then through the lens of predictive modeling has provided clarity around where RPM might be best allocated for the most meaningful impact. Instrumental in this work will be effective care coordination with WellSpan’s Patient Centered Medical Homes, Health Coaches, Population Health Case Management, Home Health, and Palliative Care.

Along our Remote Patient Monitoring journey, we will continue to be served by our compass of, ‘Always putting patients first’. Our patients may be remote in their locations, but they will remain at the forefront of our focus and at the center of all we do.

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BABY SCRIPTS— WELLSPAN’S MOBILE APP SOLUTION FOR EXPECTANT OBJECTIVES

BY DIANE L . MOORE, MSN, RN | Administrative Director, Women & Children Services, WellSpan Health

WellSpan understands that leveraging technology is a tactic, helping to influence expectations, but also allows WellSpan Health to have a more significant role in the lives of patients.

Knowing their customers use applications to track ovulation, monitor fertility, track menstruation, fitness and nutrition, WellSpan sought to support the obstetric patient with a mobile app to help expectant mothers follow their care plan and have easy access to resources. Consumer research related to Apps has found the average expectant mother downloads up to three Apps during the course of pregnancy. WellSpan recognized the opportunity to enter this sphere of patient influence as a reliable and valued expert resource.

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In June 2018, the WellSpan Women and Children Service Line launched a new prenatal App called BabyScripts™, a software application for use on iOS and Android mobile platforms.

BabyScripts includes a customizable prenatal App and home remote-monitoring solution. The App was deployed to eleven OB/ GYN practices across the system and within the first week the practices enrolled over two hundred obstetric patients who were actively using the App. Some of the features of the BabyScripts include weekly tasks tailored to the patient’s fetal-gestational age, patient education resources using March of Dimes and ACOG based content, practice contact information, links to videos, childbirth education class registration and the ability to push out reminders and information to all App users. The second phase of the BabyScripts technology was launched in July 2018 and consisted of a home remote-monitoring solution (“Schedule Optimization”) available to low risk patients. Patients who select optimization have the ability to track weight manually and blood pressure remotely through a blue-tooth connected blood pressure cuff that is provided by BabyScripts via a “Mommy Kit.” The BabyScripts

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remote-monitoring component tracks abnormal data trends in blood pressure, which alert providers through what’s called “triggers.”

Triggers are triaged by staff in the provider’s office through a predefined process. One of the additional benefits of using remotemonitoring is the increased patient engagement because the patient is in control of the monitoring. The optimized prenatal visit schedule reduces the number of prenatal visits thereby opening additional appointment availability. The WellSpan OB/GYN providers chose to reduce their prenatal visits for optimized patients from fourteen visits to nine visits. Phase two of this project was piloted at the practice locations in York, PA with plans for deployment to the OB/ GYN practices in other WellSpan markets in the near future. The combination of patient education and the monitoring of low-risk pregnancies achieved through BabyScripts allows WellSpan to meet customer expectations.

Through deployment of this technology, WellSpan also created a one-touch provider hotline to contact the provider on-call.

Not only was this intended to bring convenience, but also a secondary benefit of increasing confidence for the patient and building provider-patient relationships.

Since the June implementation of the prenatal App, WellSpan has enrolled 2,266 patients. Over 144 of these registered obstetric patients were low risk and able to participate in Schedule Optimization – prenatal care option. Prenatal education/information has been customized by WellSpan clinicians and added to the App, which has replaced the use and cost of handouts and educational books. Pennsylvania state required educational videos as well as post-partum and newborn education content has also been added to the App. Push notifications are being deployed through the App announcing community programs and various reminders about childbirth classes and pregnancy related care needs. Overall, patient feedback from BabyScripts satisfaction surveys has been overwhelmingly positive with 91% of surveyed moms indicating they were satisfied with their BabyScripts experience.

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VERSALUS

BY WALTER BOHNENBLUST, MD | Director of Utilization Review, Tower Health / GREG SORENSEN, MD | EVP & Chief Medical Officer, Tower Health / JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners / JOANNE RESNIC, MBA, BSN, RN | VP Clinical Excellence, AllSpire Health Partners

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Since its introduction in 2013, the two-midnight rule (2MN) has created confusion and has had multiple interpretations among hospitals and vendors alike. Hospitals are paid differently for treating inpatients versus outpatients. With the 2 MN rule, CMS has tried to clarify when it is appropriate to admit someone as an inpatient. Hospitals often rely on “criteria-based” approaches while overlaying components of the 2MN Rule, that often results in compliance issues and/or overbilling. Because of these issues, the Office of the Inspector General (OIG) has recommended, and CMS agreed, that additional scrutiny and monitoring are needed to address these deficiencies, and CMS has responded by increasing its auditing practices.

Versalus Health was launched in 2016 by healthcare industry leaders who developed the physician advisor role in many health systems. This role is critical to improving revenue integrity and compliance with regulatory standards set forth by CMS, including the 2 MN rule. Versalus Health was created as an extension of these efforts with its purpose of helping hospitals adapt to and benefit from Medicare’s Two-Midnight (2MN) Rule1 as well as address other compliance and revenue integrity priorities. It supports health system Utilization Management (UM) departments with analytics, education and other resources to identify vulnerabilities within clinical decision-making, regulatory compliance, payer interactions, and billing requirements. By supporting UM departments with intelligent analytics and solutions that include education, financial monitoring, and clinical and operational expertise, Versalus Health enhances both compliance and financial accuracy. This approach has been successful not only with Medicare fee-for-service (FFS), but across all payers.

Image on left Navigating the Two-Midnight rule

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Tower Health was the first of the AllSpire member health systems to work with Versalus Health after learning about it at an AllSpire Health Partners council meeting. Initial analytics prepared by the firm on a year’s worth of claims data showed a benefit of approximately $1.5 Million, but more importantly to the senior

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leadership team it offered significant risk mitigation from CMS audits, along with educational opportunities for all clinical staff.

Tower Health engaged Versalus Health to achieve these goals.

The Versalus Health program began with a baseline assessment that identified drivers of compliance and revenue variance in both Medicare FFS and Medicare Advantage payers. Following this baseline assessment, Versalus Health and Tower Health worked together to change operational processes to close gaps in performance, including the implementation of a new 2MN Rule compliance process. Versalus Health provided Tower Health’s internal physician advisors with ongoing CMS regulatory education and analytic support of operations.

Additionally, Versalus Health provided ongoing monitoring of program results to focus the physician advisors on the root causes of compliance or revenue variances, ensuring that there was no slippage in initial program successes. Versalus Health also continually provides Tower Health with systemlevel program performance information, allowing for clear accountabilities and identifying and correcting any new variances in expected outcomes. This ongoing approach includes detailed evaluations at the level of diagnoses, institutions, treating physicians, and patient characteristics, leveraging hundreds of algorithms based on identifiable areas of program risk or variance. In addition, the ongoing monitoring evolves based upon Versalus Health’s continually growing library of algorithms created in response to changes in CMS regulations and commercial payer tactics.

Walter Bohnenblust, MD, Tower’s lead physician advisor stated, “Having an external vendor that objectively provides reports at the provider level, including benchmarks, is instrumental in supporting education with the provider community, and provides our team with feedback that the initiatives we have set in place are making an impact”. In July of 2017 these monthly reports also alerted the Tower UM team to an inadvertent internal

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change in required filings that may have gone unnoticed for much longer than 30 days. It allowed the UR, physician advisor and business office teams to quickly adjust and stay in compliance with CMS requirements.

The company has a “hands-on” in their approach to supporting the UM teams. Greg Sorensen, MD, Chief Medical Officer for Tower Health shared that “the Versalus Medical Director visited with many of the surgeons participating in the CMS joint bundles, and many of them had an “aha” moment when the data was shared with them. Having the outside expertise really helps credibility of the program, and the sharing of how other health systems have found themselves out of compliance is quite impactful to the provider community.” Versalus also supports Tower’s part-time physician advisors education with bi-weekly interrater calls to ensure consistency with physician advisers’ ongoing reviews.

The next step for Tower Health is to launch Versalus at its five most recently acquired hospitals. Drs. Sorensen and Bohnenblust feel strongly it will support those teams with internal review consistency, risk avoidance, clinician education and regulatory compliance.

Sources: 1. The Centers for Medicare & Medicaid Services’ (CMS) Two-Midnight Rule is a timebased admission framework to determine if an inpatient hospital admission is appropriate for a Medicare Fee-for-Service beneficiary: “Under the 2-Midnight Rule, an inpatient admission is generally appropriate for Medicare Part A payment if the physician (or other qualified practitioner) admits the patient as an inpatient based upon the expectation that the patient will need hospital care that crosses at least 2 midnights.” Source: 2016 OPPS (Final Rule CMS 1633-FC; CMS 1607-F2, 70298 Federal Register/Vol. 80, No. 219/Friday, November 13, 2015/Rules and Regulations)

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VERAX Extending The Life Of Platelets And Protecting Patients

BY CHARLES J. DICOMO, PHD | Administrative Director of Laboratory Services, Integration & Planning, WellSpan Health / MICHELLE ERICKSON, MD, MBA | Medical Director of Laboratory Services, Department Chair of Pathology & Laboratory Services, WellSpan Health / LISA SCHAEFFER, MT(ASCP) | Transfusion Services Manager, WellSpan Health

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The demand for platelets is unpredictable for many health systems, especially those with an active trauma, surgical, oncology, or maternity service line. There needs to be a consistent supply of platelets available to handle emergency cases, yet not too much to create waste - both in the monetary sense and in product that requires the ongoing commitment of community donors. The problem is compounded by the short 5-day shelf life of the typical platelet product. Because platelets are kept at room temperature, they are the most prone to bacterial contamination with the potential to cause septic transfusion reactions in patients. WellSpan Health often experienced both surpluses and deficits of platelets over time. They wanted to create a more steady and reliable supply of platelets for their patients and did so by employing a test within their transfusion services laboratory that allowed them to rule out bacterial contamination, and thereby extend the life of their platelets.

Michelle Erickson, MD, MBA, medical director of laboratory services and department chair of pathology and laboratory services; Lisa Schaeffer, MT(ASCP), transfusion services manager and Charles J. DiComo, PhD, the administrative director of laboratory services, integration and planning at WellSpan Health implemented platelet bacterial testing, using kits engineered by the Verax Biomedical company. Their Platelet Pan Genera Detection (PGD) test enables the blood bank to test for bacterial contamination at days 5, 6 and 7, with negative testing allowing the extension of shelf life up to 7 days. The patient benefits by receiving a product confirmed to be negative for bacterial contamination. The blood bank inventory has stabilized as products can be shelved for longer, making wastage much less likely. Approximately 25â&#x20AC;&#x201C;30% of platelet transfusion patients are receiving Verax tested products, products that previously would have been wasted. The cost savings of utilizing these platelets is approximately $10,000 per month.

Since deploying the Platelet PGD test, WellSpan now can improve access to platelets not just at the major hospital center, but also at their regional sister hospitals.

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As with most blood banks, space is always at a premium, and there is never time to spare. Fortunately, the Verax test is simple to perform, takes only about 45 minutes and the Platelet PGD test requires a minimal footprint in the lab. No additional personnel was needed, and training was supported by Verax Biomedical.

Implementation from start to finish was roughly two months with the company supporting new policy development as well as competency testing for WellSpan.

Dr. DiComo also chairs the AllSpire Health GPO Laboratory Collaborative and shared his Verax experience with his colleagues.

Seeing a 16-month savings through reduced waste of just over $205,000 for WellSpan Health, DiComo knew this would be of interest to this group to potentially deploy in their health systems' blood banks. Tower Health also deployed this system and showed similar reductions (see graphs). Other collaborative members are considering utilizing the test. Additionally, leveraging the size of the participating health systems, the collaborative was able to negotiate a favorable unit price for the Platelet PGD test.

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Total Platelet Transfusions

Transfusions with Platelets Older Than Five Days 450 400 350 300 250 200 150 100 50 0

1400 1200 1000 800 600 400 200 0 Pre-Verax

Post-Verax

Pre-Verax

Total Number Platelets Outdated 350 300 250 200 150 100 50 0

Post-Verax

Total Number Platelets Outdated 30% 25% 20% 15% 10% 5% 0%

Pre-Verax

Post-Verax

WellSpan

Tower

WellSpan

Tower

WellSpan: Before Dates: 7/1/2015–6/30/2016 After Dates 7/1/16–6/30/2017 Tower: Before Dates: 1/1/2016–12/31/2016 After Dates 4/1/2017–12/31/2017

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According to Dr. DiComo, â&#x20AC;&#x153;We now have a best practice for ensuring patient safety and extending platelets to days six and seven, which provides better resource management, saves money and most importantly supports us in delivering exceptional patient care.â&#x20AC;?

The AllSpire Health GPO Laboratory collaborative is a uniquely engaged group that meets monthly to review upcoming GPO contract renewals as well as work collegially to share best practices, new innovations in the laboratory space and problem solve around laboratory challenges. It is comprised of administrative leaders from each of the participating health systems, including Veronica Fraser, director of laboratory services, Atlantic Health System, Adam S. Baldwin, regional lab director, Hackensack Meridian Health, Jon Morell, director supply chain management, Lehigh Valley Health Network and Ellen Kellom administrative director of laboratory services, Tower Health. These leaders share a commitment to stewardship of resources and continually strive to enhance the quality, safety and efficient delivery of laboratory services to the patients their health systems serve.

This is just one example of the power of collaboration within AllSpire. Not only a cost savings exercise, this case also exemplifies using the principles of knowledge transfer to make care safer for the patients served as well as preservation of precious resources of the AllSpire communities.

Photo from top to bottom Charles J. DiComo, PhD Administrative Director of Laboratory Services, Integration & Planning Michelle Erickson, MD, MBA Medical Director of Laboratory Services, Department Chair of Pathology & Laboratory Services Lisa Schaeffer, MT(ASCP) Transfusion Services Manager

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APPLE’S EHR INITIATIVE Why Is This Time Different?

LVHN’s Decision & Experience

BY NADINE H. OPSTBAUM, MBA | Director, Application Development and Support, Information Services, Lehigh Valley Health Network / DONALD LEVICK, MD, MBA, CPE, FHIMSS | Chief Medical Information Officer, Diplomate, Clinical Informatics, ABPM, Lehigh Valley Health Network / JIM LEDERER, MD | VP Clinical Excellence, AllSpire Health Partners

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Apple released Apple Health Viewer to 19 health systems at the beginning of 2018. The Health Viewer is intended to be an electronic medical record (EMR) data viewer and functions to be seamlessly interfaced with the patient’s main health record.

Access to the data will be via the Apple Health app on iPhones and iPads. Access and interoperability are hoped to further patient engagement through an app on the patient’s iPhone. Moreover, if a patient has records at more than one participating health system, the Apple Health Viewer will aggregate all the patient’s data within the app if all providers are participating with providing data to the Apple Health Viewer. When a user’s iPhone is locked with a passcode, Touch ID, or Face ID, their health data in the Health app is encrypted on device.

Apple will open the platform up to innovators and application developers so that expanded benefits to the patient can be offered and realized.

Many healthcare organizations already offer an EMR based portal for the patients to access their data. The Apple Health Viewer is a one-way data view with no opportunity for the patient to input data to their provider’s EMR either from Bluetooth enabled medical devices or self-data entry. Future versions of the viewer will have this functionality. The healthcare organization’s EMR portal already allows for view only this patient data entry and for searching and requesting information, prescription renewals or appointments for care. Many healthcare executives see these competing platforms as possible barriers to adoption of the Apple Health Viewer.

Lehigh Valley Health Network learned of the Apple Health Viewer initiative in January of 2018 and expressed interest in March 2018 to Apple to be on the next round of healthcare organizations for participation. Lehigh Valley Health Network went live with the Health Viewer in June 2018. Currently there are 82 organizations across the country who have implemented the Apple Health Viewer

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as a data integration and aggregation tool for their patients. To date, 220,000 LVHN patients use the MyLVHN portal. Since the implementation of the Apple Health Viewer, 4989 patients have integrated their data within the Apple Health Viewer.

Lehigh Valley Health Network sees the Apple Health Viewer as another important tool for patients to take control of their personal health data and as importantly, the viewer is an important tool for use in remote monitoring of high risk patients (patients at home, often after hospitalization or significant illness). With the next phase of medical device integration, Lehigh Valley Health Network will look to integrate data from scales, oximeters, glucose meters, blood pressure monitors and cardiac rhythm monitors into the patientâ&#x20AC;&#x2122;s care plans within the EMR. The goal is through having more available data integrated in the patients EMR, better outcomes can be achieved. By recognition of earlier clinical deterioration or significant changes in status patients can receive interventions which can reverse the decline and perhaps avoid an emergency department visit or hospitalization.

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A JOURNEY TOWARD COMPREHENSIVE INNOVATIVE CULTURE The Network Established A $25 Million Investment In Innovation To Bring Breakthroughs In Healthcare Delivery To Market

BY SANDRA POWELL-ELLIOTT | VP, Life Sciences & Innovation, Hackensack Meridian Health JOANNE RESNIC, MBA, BSN, RN | VP Collaborative Initiatives, AllSpire Health Partners

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Hackensack Meridian Health, New Jersey’s largest and most integrated health network, has been on a journey to build an innovative culture at all levels of the organization. The inaugural step in this journey was the establishment of the network’s $25 million investment fund targeted at startups, early stage companies, and creative ideas promising great breakthroughs in how care and services can be provided. In an effort to demonstrate the opportunity and the willingness to innovate, HMH developed what is now known as the “Bear’s Den”. Launched in 2017, Bear’s Den features a panel of experts, including CEO Robert C. Garrett, leading physicians, key network executives, venture capitalists, and patent attorneys, who gather regularly to vet proposals from entrepreneurs. The health network’s novel incubator has vetted many products and strategies to streamline care delivery, reduce infections, lower hospital readmissions and help patients partner in their care with physicians.

“Bear’s Den has been a winning strategy for Hackensack Meridian Health by supporting the next breakthroughs in care delivery and it’s time to include our dedicated team members who know best how to innovate from their valuable frontline experience,’’ said Robert C. Garrett, CEO of Hackensack Meridian Health.

To date, Bear’s Den has supported two major innovations through a $25 million fund: Pillo, a health robot for the home (see sideline article) and PurpleSun, the only technology with a 90- second disinfection cycle to eliminate microorganisms to prevent hospitalacquired infections.

The Wall Street Journal called PurpleSun a “Game Changer in Health-Tech’’ and noted that PurpleSun is living up to claims it can partner with large healthcare providers to meet their important needs in the era of value-based care, which rewards hospitals and providers for keeping patients healthy and out of the hospital.

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" Innovation is in our DNA at Hackensack Meridian Health,’’ said Andrew Pecora, M.D., president of physician enterprise and chief innovation officer. Building on the success of Bear’s Den, Hackensack Meridian is expanding, creating Bear’s Den spaces and programming to all hospitals. “We want to encourage the network’s more than 34,000 team members and physicians to bring forth their best ideas to improve care delivery and enhance patient satisfaction,” shared Pecora, M.D. By creating designated space in each of the network’s 17 hospitals, staff members from Bear’s Den meet team members on site to discuss their ideas. Additionally, entrepreneurs will periodically visit the hospital locations and share their inspiring stories with team members to encourage them to innovate.

"We understand that our ongoing success is dependent on our ability to continue to innovate how we provide care in the future. Building a culture of creative, collaborative problem solving though out the organization is one of the critical steps to sustaining an agile organization,” says Garrett.

Here are some elements to consider:

“ Creating a culture of innovation requires more than generating ideas, it is solidified by execution.”

—Sandra Powell-Elliott, VP, Life Sciences and Innovation

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• E stablishing a joint relationship between Hackensack Meridian Health and New Jersey Innovation Institute, an affiliate of the New Jersey Institute of Technology, to create collaborative opportunities together—engineers, scientists, and health care experts—around the delivery of value based care.

• Launch of “Bright Ideas”, a virtual idea submission system and challenge management platform used by many Fortune 100 companies to “crowdsource” team member and clinician engagement in creating innovative products, solutions, creating innovation products and solutions.

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• Development of the Center for Discovery and Innovation (CDI) in Nutley, N.J. located at the birthplace of the modern day biotech industry, Hoffman La-Roche Campus. The CDI houses three clinical institutes for state of the art translational research labs in regenerative medicine, infectious disease and cancer, as well as multiple myeloma.

• Experience Café (XCafe) sessions held monthly targeted innovative approaches to dramatically improving the experience of both patients and providers of care resulting in improved patient satisfaction and clinician satisfaction scores.

Wambi, a unique platform for providing specific employee feedback from individual patients, is just one example of efforts being launched as a result of the XCafé’s efforts.

• Launch of Maestro (Q1 2019), a physician based communication and workflow platform aimed at providing a unique service targeted at saving physicians’ time, improving referrals, as well as creating a streamlined, personalized communication tool.

• Hack-A-Thons and Code-A-Thons with NJ based Universities targeting clear health challenges, such as maternal mortality and morbidity, to engage emerging innovators in aiding Hackensack Meridian Health by further extending its network of innovators to the emerging work force of programmers.

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Hackensack Meridian First Venture Investment: Pillo Health

Hackensack Meridian Health opened its Innovation Center in the summer of 2017 in Newark at the New Jersey Innovation Institute on the campus of New Jersey Institute of Technology. Concepts are brought to the Ideation Center which is led by Andrew L. Pecora, MD, Hackensack Meridian Health’s Chief Innovation Officer, Joe Lemaire, President, Health Ventures, Sandra PowellElliott, Vice President, Life Sciences and Innovation and Al Baker, Director Consumer Technology and Service Development. “This is a place where we never say no, but you may hear not now or you are not ready yet” says Dr. Pecora. The staff at the Ideation Center helps coach the entrepreneurs to be able to present at one of their monthly review sessions. Along with the Ideation Center staff, appropriate subject matter experts are also part of the evaluation process. Each are evaluated in the following areas: • D oes this clearly address a problem identified in healthcare?

• D oes it have protected Intellectual Property?

• I s there a clearly articulated plan to scale?

• I s the management team able to drive to profitability?

• Does it bring value to HMH?

Often, innovations are presented multiple times. Once the team at the Ideation Center feels it is ready for the next phase of the process, it moves to the next evaluation step. The innovation is presented in a “Shark Tank” like program in a space known as the “Bear’s Den”.

The first idea that has moved forward to receive investment is “Pillo” from Pillo Health, based in Boston, MA. The company was brought to the Ideation Center team’s attention by the Chairman of Medicine, Laura Jacobs, MD. Pillo is a medical hub that is used in a patient’s home, and essentially serves as a health care companion that integrates with all smart home and mobile devices. Leveraging voice and video technology, this device can remind a patient of self-care tasks like taking medications, making an appointment or taking a blood pressure. It can sync with smart devices to log information like weight and it can digitally coordinate prescription refills.

Leveraging voice and video technology, this device can remind a patient of self-care tasks like taking medications, making an appointment or taking a blood pressure. It can sync with smart devices to log information like weight and it can digitally coordinate prescription refills.

The Pillo team scored very high during its Bear's Den presentation and the health system was so impressed with this innovation that it is investing $250,000 in the startup. Additionally, it is offering its services to Pillo Health to do system trials of the product, which began first quarter of 2019.

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Hackensack Meridian Health Funds New Technology to Help Reduce Hospital-Acquired Infections “Preventing the transmission of antibiotic resistant bacteria and infections in our hospitals is foundational for patient safety,’’ said Dr. Jerry Zuckerman, vice president of infection prevention and control at Hackensack Meridian Health. Although significant progress has been made in preventing healthcare-associated infections, there is much more work to be done, according to the federal Centers for Disease Control and Infections. On any given day in the nation, about one in 31 hospital patients has at least one healthcare-associated infection, according to the CDC. Hospital-acquired infections are not only detrimental to patients; they drive up health care costs unnecessarily with longer hospital stays, readmissions or other costly care.

PurpleSun, Inc. is the second innovative company funded through Hackensack Meridian Health’s $25 million fund.

The device allows a much faster, more effective automated light based delivery systems which can disinfect equipment like beds and carts as well as spaces and rooms for the purpose of ensuring that the environment is well prepared and ready for patient use.

The Wall Street Journal called PurpleSun a “Game Changer in Health-Tech’’ and noted that PurpleSun is living up to claims it can partner with large healthcare providers to meet their important needs in the era of value-based care, which rewards hospitals and providers for keeping patients healthy and out of the hospital.

The funding will enable PurpleSun to scale its manufacturing and enter the commercialization phase to meet demand and serve the two largest integrated health networks in the tri-state area, Hackensack Meridian Health and Northwell Health, with approximately 40 hospitals.

PurpleSun is the only company to develop technology with a 90- second disinfection cycle utilizing a form of ultraviolet light energy as well as a unique delivery design. It has been piloted in operating rooms, post-acute care units, intensive care and emergency departments and has reported a 98 percent effectiveness in eliminating microorganisms in those areas, according to recent reports published in the American Journal of Infection Control.

Purple FMUV Shadowless™ Delivery Light Technology: A fundamental shift on how hospitals and humans perform the daily task of manual disinfection of patient care equipment and spaces.

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MAPPING THE FUTURE FOR PATIENT CARE Clinical Research Trials Improve Cancer Treatments And Outcomes

BY ATLANTIC HEALTH SYSTEM

Advances in the treatment of cancer continue to improve with the help of clinical research trials like those conducted at Atlantic Health System. “Most clinical trials are related to chemotherapy,” says Steve Halpern, MD, director, Pediatric Oncology Center. “Because of that, we’ve changed the way the chemotherapy is given to help better kill the cancer cells. But now, we’re seeing more targeted therapy used in conjunction with chemotherapy.”

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In targeted therapy, the unique properties of the cancer cell are attacked directly. “We had a child recently who had the most common type of leukemia. We treated her with one round of chemotherapy, and it didn’t work. She got sick and lost her hair and was in the hospital quite a bit,” says Dr. Halpern. “We then gave her targeted therapy once a week as an outpatient.

She felt much better within a short time and after just three weekly treatments of this targeted therapy, the leukemia was completely eradicated.”

In addition to the pediatric cancer research, we are conducting clinical studies in adults at Atlantic Health System’s Overlook Medical Center. Overlook Medical Center is the only hospital in New Jersey involved in the MIND Study of Artemis’ minimally invasive neuro evacuation device to remove intracerebral hemorrhage. The device is inserted through a small incision into the affected area of the brain and removes the clot by suctioning it out through a catheter like device. The study is open to patients 18 to 80 years old with an intracerebral hemorrhage. “ Our interventionalist team has performed about 60 of these procedures using the Artemis device over a two-year period and has seen an increase in survival rate with the device pre-trial,” according to principal investigator Paul Saphier, MD, an endovascular neurosurgeon for the Atlantic Neuroscience Institute. “We are proud to be a major participant in this trial, as well as many others, that provide a benefit to our patients.”

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A NEW COLLABORATION ANNOUNCED FOR CLINICAL TRIALS

BY ATLANTIC HEALTH SYSTEM

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Six regional health systems announced on April 16, 2018 the founding of a nonprofit clinical research consortium—Partners in Innovation, Education and Research (PIER Consortium™) —a streamlined clinical trial system that spans New Jersey and Pennsylvania.

The founding members of PIER Consortium include Atlantic Health System, Drexel University, Einstein Healthcare Network, Geisinger, including AtlantiCare, Main Line Health and Thomas Jefferson University.

Clinical trials have traditionally been offered at academic medical centers and through affiliated hospitals to ensure patients are treated safely and effectively with the best standard of care. Unfortunately for patients, this can mean traveling many miles, sometimes across the country, for novel treatment. The PIER Consortium will bring new clinical trial sites to larger numbers of patients, while also bringing new treatments to market faster. “ Atlantic Heath System has a long history of conducting clinical trials, enabling many of our patients to participate in new cutting-edge treatments in their community,” says Jan Schwarz-Miller, MD, MPH, SVP, chief medical and academic officer for Atlantic Health System. “PIER will allow Atlantic Health System to add to its portfolio and assist in moving research studies along faster. We also have the opportunity to work within the consortium to develop and lead studies that will have greater impact to the patients we serve. With all of the health systems participating in PIER, we can enroll the needed number of study participants faster and the benefit of the treatment can be determined sooner.”

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ATLANTIC HEALTH SYSTEM TRANSFORMS CANCER CARE WITH GROUNDBREAKING PARTNERSHIP

BY ATLANTIC HEALTH SYSTEM

To take advantage of new treatments that are available to cancer patients, Atlantic Health System has entered into a special partnership with the Translational Genomics Research Institute (TGen) and Origin Commercial Ventures. Together, theyâ&#x20AC;&#x2122;re developing a new platform to deliver economically viable immunotherapies and other breakthrough cancer treatments to the region.

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BETTER CARE AND COLLABORATION

The Breakthrough Oncology Accelerator flagship platform at Atlantic Health System will create a model to ultimately enable health systems around the country to provide faster access and better patient outcomes by enabling clinicians and researchers to share their knowledge and provide more options for patients.

Through the partnership, Atlantic Health System, TGen and Origin will leverage their proprietary platforms, expertise and collaborations to identify and deploy those resources that best help oncologists meet the needs of their patients.”

“We’re looking at an onslaught of really incredible medicine that’s going to become available to cancer patients,” says Cosmo Smith, managing partner, Origin CV. “It’s our job to ensure that not only are there infrastructure, operating and clinical capabilities able to onboard these, but financing capabilities that put these therapies within reach of oncologists and their patients.

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On the research side, TGen is hard at work investigating new therapies for cancer, neurological disorders, infectious disease and rare childhood disorders. Using advanced technology, TGen delves into the origins of cancer by exploring the human genome.

“TGen’s genomic-based programs help develop cuttingedge therapies for patients whose tumors have progressed on all previous therapies,” says Daniel Von Hoff, MD, TGen’s distinguished professor and physician-in-chief. “We use all the science-based information we have to come up with a therapy that best fits that person.”

Bringing everything full circle is Atlantic Health System. Eric Whitman, MD, medical director of Atlantic Health System Cancer Care, heads up the partnership’s efforts at Atlantic Health System and has already seen interest from research companies. “We’ve brought on around 15 clinical trials as part of this partnership. This includes drugs and technologies that we never would have had access to in the past.”

PIONEERS IN HEALTH CARE DELIVERY

Atlantic Health System is the one health system selected by TGen and Origin to create this new platform. Why Atlantic Health System? Smith says Origin CV selected Atlantic Health System as a partner “because of its absolute undying desire to serve patients in a way that is not only compassionate but that provides the best options to those experiencing really complex cancers.”

Another important element of the alliance is Atlantic Health System’s pioneering approach. “I’ve rarely met such an entrepreneurial nursing and medical staff and business team across an organization,” says Smith. “That’s a credit to the leadership because in order to onboard these types of breakthrough medicine, you have to be willing to be innovative all the time.”

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TGen’s Dr. Von Hoff concurs with Smith, “Atlantic [Health System] has a great developing center. They are anxious to bring new therapies to their patients, and their emphasis is clearly on patient care rather than just the science.”

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ALLSPIRE’S SCALE & SCOPE ALLSPIRE’S ANNUAL AGGREGATION OF ASSETS AllSpire Health Partners is a consortium of five health systems that leverages its combined strength and clinical expertise to drive clinical excellence, improve affordability and enhance economic sustainability for the member health systems. Our hospitals and medical centers have been honored with numerous awards and are recognized throughout the region for their leadership.

The following member core statistics highlight key metrics of AllSpire’s combined resources.

S C A L E + C A PAC I T Y

37

Acute Care Hospitals

10,117

464,909

1,755,326

373

102

1,730

Licensed Acute Beds

Hospital ORs

Annual Patient Admissions

ASC ORs

Annual Emergency Visits

Skilled Nursing Facility Beds

POPUL ATION S E RVE D

33

Counties Served

286

1,062,904

ACO Covered Lives & Fully Insured Lives

15,963,526 Total Service Area Population

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TALE NT POOL

15,636

2,551

Physicians on Staff

96,331 Total Employees

Employed Specialists

68,428

1,447

Employed Clinicians

Employed PCPs

*Non-physician

ECONOMICS AN N UAL TOTAL

$15B

$3.2B

$7.6B

Enterprise Revenue

Supply Chain Purchasing Volume

Employee Salary, Wages & Benefits

29 %

1%

26 %

16 ,000

3,500

14,000

3,000

12,000

10 %

17 %

2,500

10,000

2,000

8,000

1,500

6,000 4,000

1,000

2,000

500

0

0

2016

2017

2018

Enterprise Revenue

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9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0

2016

2017

2018

Supply Chain Purchasing $ Volume

2016

2017

2018

Employee Salary, Wages & Benefits

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www.atlantichealth.org

Atlantic Health System is at the forefront of medicine, setting standards for quality health care in New Jersey, Pennsylvania and the New York metropolitan area. Powered by a workforce of more than 16,500 team members and 4,800 affiliated physicians dedicated to building healthier communities, Atlantic Health System serves more than half of the state of New Jersey including 11 counties and 4.9 million people. The system offers more than 400 sites of care, including six hospitals: Morristown Medical Center in Morristown, NJ, Overlook Medical Center in Summit, NJ, Newton Medical Center in Newton NJ, Chilton Medical Center in Pompton Plains, NJ, Hackettstown Medical Center in Hackettstown, NJ and Goryeb Childrenâ&#x20AC;&#x2122;s Hospital in Morristown, NJ. In addition to the employed workforce, Atlantic Alliance, a Clinically Integrated Network represents more than 2,500 health care providers throughout northern and central NJ. This network includes 1,000 physicians and providers comprising one of the largest multi-specialty practices in New Jerseyâ&#x20AC;&#x201D;Atlantic Medical Group, as well as members of the Atlantic Accountable Care Organization and Optimus Healthcare Partners which work to enhance patient care delivery.

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Atlantic Health System provides care for the full continuum of health care needs including 11 urgent care centers, Atlantic Rehabilitation and Atlantic Home Care and Hospice. Facilitating the connection between these services on both land and air is the transportation fleet of Atlantic Mobile Health.

Atlantic Health System leads the Healthcare Transformation Consortium, a partnership of seven regional hospitals and health systems dedicated to improving access and affordability and is a founding member of the PIER Consortium—Partners in Innovation, Education, and Research—a streamlined clinical trial system that will expand access to groundbreaking research across six health systems in New Jersey.

Atlantic Health System has a medical school affiliation with Thomas Jefferson University and is home to the regional campus of the Sidney Kimmel Medical College at Morristown and Overlook Medical Centers and is the official health care partner of the New York Jets.

AWARD-WINNING CARE

Our programs, including heart care, care cancer care, orthopedics, neuroscience, pediatrics, rehabilitation medicine, and women’s health are consistently lauded for their excellence by physicians and patients alike. Atlantic Health System’s hospitals, programs and services have received prestigious recognition, including: • “100 Best Companies to Work For®”: Fortune Magazine •B est Workplaces in Health Care: Great Place to Work® and FORTUNE® Magazine •B est Workplaces for Diversity: Great Place to Work® and FORTUNE® Magazine •B est Workplaces for Women: Great Place to Work® and FORTUNE® Magazine

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•1 50 Great Places to Work in Healthcare | 2018: Becker’s Healthcare •B est Places to Work in Health Care: Modern Healthcare • “ 52 Great Health Systems to know:” Becker’s Hospital Review •M orristown Medical Center—rated #1 hospital in New Jersey: U.S. News & World Report •M orristown Medical Center—rated top 20 hospital in U.S. for Cardiology & Heart Surgery—named top 50 hospital in U.S. for Gastroenterology & GI Surgery - rated # 4 hospital in New York Metro area: U.S. News & World Report •M orristown Medical Center—rated high performing in 8 conditions and procedures: Abdominal Aortic Aneurysm Repair, Aortic Valve Surgery, Heart Bypass Surgery, Heart Failure, Colon Cancer Surgery, Hip Replacement, Knee Replacement, and Lung Cancer Surgery—rated high-performing in 5 specialties: Geriatrics, Nephrology, Neurology & Neurosurgery, Orthopedics, Pulmonology: U.S. News & World Report •O verlook Medical Center—highly-rated in New Jersey #8— rated high-performing in Neurology & Neurosurgery: U.S. News & World Report •O verlook Medical Center—rated regionally in Heart Failure, Colon Cancer Surgery, and COPD: U.S. News & World Report •M orristown Medical Center/Overlook Medical Center— America’s 50/100 Best Hospitals™ - Healthgrades •M orristown Medical Center/Overlook Medical Center— Distinguished Hospital Award for Clinical Excellence™— Healthgrades •A tlantic Health System—“100 Hospitals and Health Systems with Great Oncology Programs:” Becker’s Hospital Review •A tlantic Health System—“100 Hospitals and Health Systems with Great Heart Programs:” Becker’s Hospital Review

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•A tlantic Health System—“100 Hospitals and Health Systems with Great Orthopedic Programs:” Becker’s Hospital Review •A tlantic Accountable Care Organization, Optimus Healthcare Partners (ACO)—“144 Accountable Care Organizations to Know:” Becker’s Hospital Review •A tlantic Rehabilitation - “Best Nursing Homes” Overall and ShortStay Rehabilitation—High Performing: U.S. News & World Report •A tlantic Health System’s Stroke Centers—Gold Seal of Approval for Primary Stroke Centers: The Joint Commission •O fficial Health Care Partner of the New York Jets ATLANTIC HEALTH ADVANCEMENTS (AHA!)

First Year Results Include Multiple Patents and Robust Idea Pipeline Launched at the end of 2017, Atlantic Health Advancements­— AHa!—is designed to inspire Atlantic Health System’s team of more than 16,500 employees and 4,800 physicians to generate ideas that will enhance care delivery and improve clinical outcomes. By supporting the ideas generated by employees and physicians, the health system encourages creativity, celebrates collaboration and develops innovations that sustain best practice. The AHa! program provides not only financial support to the front-line inventors but also access to engineering and prototyping specialists along with many other business processes needed to convert ideas into products, all in an accessible, streamlined system.

AHa! shares a portion of the net proceeds from Intellectual Property that is commercialized, sold, assigned, or licensed to third parties with the inventor. The remainder continues to fuel Atlantic Health System’s mission of building healthy communities.

One year after it was created, Atlantic Health System’s innovation center and idea incubator has led to improved care delivery, multiple patents, and a robust idea pipeline. Atlantic Health System currently holds patents on the following innovations:

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The ISSI® Box—Insulin Safety Secure Initiative, AHa!’s first advancement, brought to market in 2018, was the brainchild of two pharmacists, a pharmacy tech and a nurse, who realized they could save insulin by developing a clear process for labeling and storing the product between shifts, ending the waste of continually opening new insulin vials. Now, when nurses start their shift, they receive their own ISSI Box with insulin, making it more accessible and easily tracked by pharmacy staff, and resulting in annualized savings of $100,000 in decreased insulin use from one facility alone. The original ISSI Box and soon-to-be-announced new versions are manufactured through a licensing agreement with Health Care Logistics.

The Lighted Polyhedral Retractor was originally developed to help create space around the thyroid during surgeries, allowing surgeons a wider field to operate away from veins and blood vessels. This innovation, developed by an Atlantic Health System surgeon, is now being expanded into additional uses and enhanced for other surgeries.

The Nerve Protecting Dissection Device was inspired by surgeons’

need for an energy-based dissection device that could help avoid damage to nerves and veins during surgery. This device, invented by an Atlantic Health System surgeon, connects to the dissection tool, and disables the dissection tool or makes it operate differently when the potential for nerve or venous damage is imminent. It also provides a real-time graphical interface that lets surgeons know how close they are to nerves and veins.

Another innovation currently undergoing enhancement, prototyping and testing is the Image Distance Control Device (patent pending).

AHS nurses were confronted with the challenging task of photographing the wound healing process in environments that featured inconsistent lighting and distance. The Image Distance Control Device system allows caregivers to obtain consistent photographs over time by providing positioning, orientation and lighting by way of a novel camera phone attachment—resulting

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in more consistent and accurate photographs for the ongoing assessment and treatment of healing wounds.

In June of 2018, Atlantic Health System partnered with MedExpress, part of Optum/United Healthcare, to provide coordinated urgent care services at 11 centers in neighborhoods throughout northern and central New Jersey.

As the line between payor and provider becomes thinner, this is one example of how Atlantic Health System is thinking differently and forging new relationships to support their communities. This collaboration provides patients with additional points of access to the health system and its services, helping them stay healthy close to home.

These jointly-owned and co-branded urgent care centers work closely with Atlantic Health Systemâ&#x20AC;&#x2122;s affiliated community physicians and clinically integrated network, offering patients more choices than ever before. The centers will also enhance connections with primary and specialty care doctors who can provide advanced care and help patients meet their long-term health goals.

In September of 2018, Atlantic Health System and Thomas Jefferson University formally dedicated the regional campus of Jeffersonâ&#x20AC;&#x2122;s Sidney Kimmel Medical College (SKMC) at Morristown Medical Center and Overlook Medical Center, offering a program for third-year medical students unique in northern New Jersey. The Atlantic Health System regional campus is home to the Longitudinal Integrated Clerkship (LIC)Program, a special model of medical education that reinforces continuity of care and patient-centered treatment.

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www.hackensackmeridianhealth.org

Hackensack Meridian Health is a leading not-for-profit health care organization that is the largest, most comprehensive and truly integrated health care network in New Jersey, offering a complete range of medical services, innovative research and life-enhancing care.

Hackensack Meridian Health comprises 17 hospitals from Bergen to Ocean counties, which includes three academic medical centers—Hackensack University Medical Center in Hackensack, Jersey Shore University Medical Center in Neptune, JFK Medical Center in Edison; two children’s hospitals—Joseph M. Sanzari Children’s Hospital in Hackensack, K. Hovnanian Children’s Hospital in Neptune; nine community hospitals - Ocean Medical Center in Brick, Riverview Medical Center in Red Bank, Mountainside Medical Center in Montclair, Palisades Medical Center in North Bergen, Raritan Bay Medical Center in Perth Amboy, Southern Ocean Medical Center in Manahawkin, Bayshore Medical Center in Holmdel, Raritan Bay Medical Center in Old Bridge, and Pascack Valley

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Medical Center in Westwood; two rehabilitation hospitals— JFK Johnson Rehabilitation Institute in Edison and Shore Rehabilitation Institute in Brick; and a behavioral health hospital, Carrier Clinic in Belle Mead.

Additionally, the network has more than 500 patient care locations throughout the state which include ambulatory care centers, surgery centers, home health services, long-term care and assisted living communities, ambulance services, lifesaving air medical transportation, fitness and wellness centers, rehabilitation centers, urgent care centers and physician practice locations. Hackensack Meridian Health has 34,000 team members, nearly 7,000 physicians and is a distinguished leader in health care philanthropy, committed to the health and wellbeing of the communities it serves.

The network’s notable distinctions include having four hospitals among the top 10 in New Jersey by U.S. News and World Report. Other honors include consistently achieving Magnet® recognition for nursing excellence from the American Nurses Credentialing Center and Top 150 Places to Work in Healthcare/2018 by Becker’s Healthcare.

Hackensack Meridian Health partnered with Seton Hall University to launch the only private medical school in New Jersey—Hackensack Meridian School of Medicine at Seton Hall University. Additionally, the network partnered with Memorial Sloan Kettering Cancer Center to find more cures for cancer faster while ensuring that patients have access to the highest quality, most individualized cancer care when and where they need it.

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www.lvhn.org

Lehigh Valley Health Network (LVHN) includes eight hospital campuses—three in Allentown including the region's only facility dedicated to orthopedic surgery, one in Bethlehem, one in East Stroudsburg, one in Hazleton and two in Pottsville, Pa.; 26 health centers caring for communities in seven counties; numerous primary and specialty care physician practices and 18 ExpressCARE locations throughout the region including the area’s only Children’s ExpressCARE at the Health Center at Palmer Township; pharmacy, imaging, home health services and lab services; extensive inpatient and outpatient rehabilitation services; and preferred provider services through Valley Preferred.

The hospitals have a total of 1,700 licensed beds with a medical staff of 2,000 - more than 1,100 of them board certified— representing 95 specialties. LVHN is the greater Lehigh Valley’s largest employer with more than 17,600 employees including Health Network Laboratories.

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LVHN’s specialty care includes trauma care at the region’s busiest, most-experienced trauma center treating adults and children, burn care at the regional Burn Center, kidney and pancreas transplants; perinatal/neonatal, cardiac, cancer care, orthopedics, and neurology and complex neurosurgery capabilities including national certification as a Comprehensive Stroke Center. Lehigh Valley Cancer Institute, Lehigh Valley Heart Institute and Lehigh Valley Special Surgery Institute give clinicians of the highest caliber the necessary infrastructure, programs and partnerships to help community members stay healthy and provide the most advanced treatment when needed. Lehigh Valley Cancer Institute is a formal member of the Memorial Sloan Kettering (MSK) Cancer Alliance, a transformative initiative to improve the quality of care and outcomes for people with cancer in community health care settings, including access to key MSK clinical trials. Robotic surgery is offered in ten specialties across the health network with more than 10,000 procedures performed since 2007.

Lehigh Valley Reilly Children’s Hospital, the only children’s hospital and Level IV NICU in the region, provides care in more than 30 specialties and general pediatrics.

The Leapfrog Group has honored Lehigh Valley Hospital–Cedar Crest, Lehigh Valley Hospital–Muhlenberg, Lehigh Valley Hospital–Pocono and Lehigh Valley Hospital–Hazleton with “A” Hospital Safety Scores. Lehigh Valley Hospital–Cedar Crest, Lehigh Valley Hospital–17th Street and Lehigh Valley Hospital–Muhlenberg are national Magnet hospitals for excellence in nursing. Additionally, Lehigh Valley Hospital– Cedar Crest has been recognized among the top five hospitals in Pennsylvania by U.S. News & World Report for five consecutive years. The network was the winner of the 2017 Vizient Bernard A. Birnbaum, MD Quality Leadership Award, which recognized LVHN for demonstrating superior quality and safety performance as measured by the Vizient Quality and Accountability Study.

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To date, LVHN has developed and implemented 33 Connected Care and Innovation Initiatives and in FY18 had over 230,000 encounters. With the support of an industry partner, LVHN created and designed the Air Products Center for Connected Care and Innovation (CCCI), located at LVHN-One City Center in downtown Allentown. The CCCI is an innovation hub that serves as a ‘laboratory’ for incubating and creating new ideas that will lead to greater value, lower costs, and ultimate achievement of the Triple Aim. A primary goal is to bring together key stakeholders in industry, education, government, health systems, and community-based organizations and members to engage them in the network’s innovation work to facilitate collaboration and create synergies and economies of scale. Over the next few years, LVHN plans to expand existing services and develop new ones with a goal of providing direct care services and consultative services across LVHN campuses and to strategic health system partners. Notably, LVHN is third in the country and among eight other participating countries in Healthcare’s Most Wired rankings for 2018 by the College of Healthcare Information Management Executives (CHIME) and achieved Stage 7 of the HIMSS Electronic Medical Record Adoption Model (EMRAM)℠, the highest level of EMR system progress at hospitals and health systems.

In June 2018, Lehigh Valley Cancer Institute’s membership in the Memorial Sloan Kettering (MSK) Cancer Alliance was extended to the Dale and Frances Hughes Cancer Center at Lehigh Valley Hospital–Pocono.

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In July 2018, LVHN acquired Hazleton-based American Patient Transport Systems, Inc. (APTS), an emergency medical services company with 100 colleagues and nearly 30 ambulances and non-emergency stretcher/wheelchair vans.

In October 2018, Lehigh Valley Cancer Institute introduced a Mobile Mammography Coach, which provides a convenient way for women to have 3D screening mammograms that can travel to community locations.

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www.towerhealth.org

Tower Health (or the â&#x20AC;&#x153;Systemâ&#x20AC;?), is a Pennsylvania non-profit corporation that serves as the parent organization of six acute care hospitals and related facilities that have formed an integrated healthcare delivery system located in the Counties of Berks, Chester and Montgomery, Pennsylvania and the City of Philadelphia, Pennsylvania. The System employs 11,840 people (9,950 FTEs), including approximately 500 employed physicians, 33 other healthcare providers, and 470 clinical support staff members.

Tower Health provides a full range of medical care to the communities it serves. The System operates 21 urgent care centers and a Home Health Care Management Company. The System also operates Reading Hospital Rehabilitation at Wyomissing and Reading Hospital School of Health Sciences, and has a comprehensive physician network. Tower Health is a partner in several JV ASCs and is engaged in the development of several additional JV ASCs and outpatient centers. All Tower Health facilities participate in a partnership with the UPMC Health Plan.

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As a system, Tower Health holds numerous clinical excellence and service line-specific awards and accreditations. Its flagship facility, Reading Hospital, is a US News & World Report 6th Best Hospital in PA, as well as a Healthgrade’s America’s 100 Best Hospitals Award™ (2017-2019). Reading is also a Becker’s Hospital Review 100 Great Hospitals in America and is Magnet-recognized. In spring of 2018, it received an “A” Rating in Hospital Safety from Leapfrog, and was also recently awarded a 5-Star Quality Rating from Centers for Medicare & Medicaid Services. From a service line perspective, Reading Hospital is a Healthgrades 100 Best Specialty Care Center for Critical Care/Pulmonary Care/Stroke Care, is a Becker’s Hospital Review 100 Hospital and Health Systems with Great Neurosurgery & Spine Programs, and is ranked #1 in PA by ProPublica for Knee and Hip Replacements. Reading Hospital recently received accreditation as a Level I Trauma Center from the Pennsylvania Trauma Systems Foundation, and the Emergency Department was awarded both the Silver Beacon Award and the Lantern Award for excellence in nursing care.

Reading Hospital is a Blue Distinction Center for Maternity Care, Cardiac Care, Knee and Hip Replacement and Bariatric Surgery, in addition to being an American Heart Association/American Stroke Association Gold Plus Award recipient for Stroke and Heart Failure and a Gold Recipient of its 2018 Mission: Lifeline® Award, among other quality and service line achievements.

All Tower Health hospitals are Joint Commission Accredited.

In addition, Brandywine Hospital is a Silver Recipient of the American Heart Association’s 2018 Mission: Lifeline® Award and is accredited by the American College of Cardiology as a Primary PCI Chest Pain Center. It is also an American College of Radiology accredited facility for Lung Cancer Screening, Mammography, CT and Ultrasound; and is a Blue Distinction Center for Knee and Hip Replacement and Cardiac Care. Chestnut Hill Hospital is an American Heart Association/American Stroke Association 2018 Gold Plus Award recipient for Stroke, as well as

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a Society of Cardiovascular Patient Care-accredited Chest Pain Center, an MBSAQIP-accredited and Blue Distinction Center for Bariatric Surgery, and a NICHE designated hospital. Pottstown Hospital is accredited by the American College of Cardiology as a Heart Failure Center. Phoenixville and Pottstown hospitals are American Heart Association/American Stroke Association 2018 Gold Plus Award recipients for Stroke. They are also accredited by the Commission on Cancer® and by the American College of Cardiology as a Primary PCI Chest Pain Center. Both hospitals are accredited by the American College of Radiology in MRI, Nuclear Medicine, Mammography, CT and Ultrasound. Phoenixville has a nationally accredited breast center and a Blue Distinction Center for Maternity Care.

Tower Health’s strategic priorities include: •C linical Excellence Ensure safe, high-quality and high-value care, constantly striving to improve care through the use of leading experts, advanced technologies, and informed analytics.

•C are Continuum Develop a comprehensive continuum of care to enhance care coordination and increase access to services. Offer a variety of patient-friendly ways to access the health system. Develop systembased service line strategies to enable effective integration and prioritization while providing convenient and cost-effective care. alue-Based Care •V Continue leadership in the shift to value-based care by expanding clinical integration, growing the regional health plan, addressing priority community health needs, and taking on risk where prudent.

• E ngagement Exceed consumer and patient needs to drive positive patient and family experiences and enhance wellness. Employ competent and compassionate clinical and non-clinical staff who are proud ambassadors of Tower Health.

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•A cademics, Research & Innovation Enhance education and training capabilities and invest in innovation and research.

• P hysician & Provider Strategies Engage physicians and providers to ensure high-quality care and outstanding access to care in the right setting.

Tower Health and Acadia Behavioral Health formed a joint venture to develop an integrated behavioral health campus featuring a 144-bed inpatient psychiatric hospital and ambulatory building. The facility and campus will be operational in Spring 2020. Tower Health is also jointly developing a branch medical school campus within a half mile of Reading Hospital with Drexel University College of Medicine. Drexel University College of Medicine at Tower Health is expected to be operational for the 2020–2021 school year and will educate 40 students for each of the four years, in addition to 20 third- and fourth-year students from Drexel.

The System recently formed a joint venture with USPI to own and operate ambulatory surgery centers in the Tower Health service area and acquired 19 urgent care sites from Premier Urgent Care—the largest urgent care provider in the metropolitan Philadelphia market—with 15 in the Tower Health service area.

In addition, effective January 1, 2019, Tower Health merged its former Affilia Home Health operations in Berks County with the parent organization of Home Health Care Management (HHCM), a local provider of home health, hospice and personal care. HHCM is comprised of Berks VNA, Pottstown VNA, and Advantage Home Health. The new organization is operating under the name Tower Health at Home.

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www.wellspan.org

WellSpan Health is an integrated health system that serves the communities of central Pennsylvania and northern Maryland. The organization is comprised of approximately 1,500 employed physicians and advanced practice clinicians, a regional behavioral health organization, a home care organization, eight respected hospitals, more than 19,000 employees, and more than 170 patient care locations. WellSpan is a charitable, mission-driven organization, committed to exceptional care for all, lifelong wellness and healthy communities.

WellSpan Health offers regional referral services in heart and vascular care, oncology, women and children services, orthopedics and spine care, neurosciences and behavioral health and, in the communities it serves, WellSpan has the only accredited Level 1 Regional Resource Trauma Center andâ&#x20AC;ŻComprehensive Stroke Center with an endovascular neurosurgery program.

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In 2018, WellSpan Health's acute-care community hospitals received a combined total of nine American Heart Association/ American Stroke Association Get With The Guidelines® (GWTG) awards recognizing the hospitals’ achievements in stroke and heart-related care, and the health system repeated as Training Magazine’s top-ranked health system in the nation for the strength of its employee training initiatives. WellSpan Surgery and Rehabilitation Hospital has received accreditation from the Commission on Accreditation of Rehabilitation Facilities (CARF) International as well as specialty accreditations from CARF for its inpatient stroke and brain injury specialty programs, and more than 30 WellSpan Medical Group primary and specialty care practices have been recognized by the National Committee for Quality Assurance (NCQA) for their ongoing commitment to patient-centered care.

Currently, WellSpan Health is pursuing several innovative initiatives across the health system. These include transforming the care model around sepsis by creating a central alert team that remotely monitors patients for sepsis indicators, leveraging remote patient monitoring to support population health, to the lab where innovative new products have been deployed to extend the life of platelets to improve patient safety while reducing waste of these precious resources.

Effective Nov. 1, 2018, Summit Health became part of WellSpan Health. Summit Health’s nonprofit system of care is dedicated to building a healthier community. As Franklin County's leading health care provider, Summit brings to WellSpan two awardwinning hospitals in Chambersburg and Waynesboro, 33 outpatient specialty and primary-care practices throughout Franklin County, lab and imaging services, a fitness center and two walk-in care centers.

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SRHO, THE NATIONAL ASSOCIATION THE NATIONAL ALLIANCE OF ALLSPIRE-LIKE ORGANIZATIONS

www.SRHO.org

Over the past decade, market and economic factors have demanded that hospitals, healthcare systems and their associated physicians align with others to create large enough networks to operate under population health and achieve economic growth.

This has resulted in a growing number of organizations opting to become part of Strategic Regional Healthcare Organizations (â&#x20AC;&#x153;SRHOsâ&#x20AC;?).

The acronym describes provider networks, alliances, collaboratives or ACOs in healthcare today that meet the following criteria: Strategic

Two or more significant healthcare organizations looking to achieve economies of scale at least equal to competitors and build the infrastructure and capabilities necessary to succeed in population health initiatives.

Regional

Comprised of healthcare organizations situated across contiguous geographies, including intra-state, statewide and multi-state markets.

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Healthcare Organizations

A formal and legal structure comprised of two or more separate and distinctive healthcare provider organizations that can take different forms depending on the criteria and goals of the parties involved.

The development of these organizations led to the creation of SRHO, The National Association in 2016. AllSpire Health Partners was, and remains, a founding member of SRHO. SRHO serves as a national forum for SRHO members and their affiliated hospitals and health systems to exchange information and address their unique challenges. It facilitates: • Sharing of knowledge and best practices to build better business models • Accelerate initiatives to bring down the cost of healthcare • Innovation and evaluation of best practices and technologies that drive high quality clinical performance • Development of revenue producing businesses that are not feasible at an individual SRHO level • Increased awareness of SRHOs and the important role they play in healthcare

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EXECUTIVE COMMITTEE

Brian A. Gragnolati President and CEO | Atlantic Health System Chair | 2019 American Hospital Association Board of Trustees Brian A. Gragnolati is president and CEO of Atlantic Health System, based in Morristown, New Jersey. Prior to joining Atlantic Health System in May 2015, Gragnolati served as Senior Vice President, Community Division of Johns Hopkins Medicine (JHM). He was operationally responsible for three owned/two affiliated hospitals, eight ambulatory and surgery center sites and community physician integration. He was successful in further developing the JHM Integrated Delivery and Financing System by expanding owned insurance product offerings, growing the geographic footprint and developing new models of clinical and financial integration.

Robert C. Garrett, FACHE CEO | Hackensack Meridian Health Network Robert C. Garrett, a nationally-renowned healthcare leader and sought-after industry expert, is the CEO of Hackensack Meridian Health Network, one of the largest, most comprehensive health networks based in Edison, New Jersey. Mr. Garrett began his time with Hackensack University Medical Center in 1981 as a resident and served as president and CEO of the Hackensack University Health Network from November 2009 through July 2016, at which time he assumed the position of co-CEO of Hackensack Meridian Health. Mr. Garrett became the Hackensack Meridian Health system CEO effective January 2019. In the face of healthcare reform, Mr. Garrett optimally positioned HackensackUHN and HackensackUMC for success through a series of acquisitions, mergers, partnerships and affiliations.

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Brian A. Nester, DO, MBA, FACOEP President and CEO | Lehigh Valley Health Network Brian Nester, DO, became president and CEO of Lehigh Valley Health Network (LVHN), based in Allentown, Pennsylvania on July 1, 2014.

LVHN is a comprehensive, integrated health network that includes three full-service licensed hospitals with five campuses, a children’s hospital, an employed physician group with nearly 1,000 members, and 11 outpatient health centers. LVHN is its region’s largest employer, with more than 13,000 employees. Dr. Nester had been the chief strategy officer (CSO) at LVHN since 2011. In that role he aligned LVHN’s business development assets with evolving population health management competencies and insurance sophistication in the creation of new partnerships and structures that will facilitate LVHN’s transformation into an accountable care organization.

Clinton Matthews President and CEO | Tower Health Chair | AllSpire Health Partners Board of Managers Clint Matthews is president and chief executive officer of Tower Health System, based in Reading, Pennsylvania. Since taking on this role in June 2010, Mr. Matthews has overseen the implementation of a system-wide electronic medical records implementation, a new system branding and advertising campaign and the oversight of a Clinically Integrated Physician Network (CLIO), as well as the approval and start of construction for $354 million in perioperative services and an inpatient bed tower. He was previously a managing director with FTI were Mr. Matthews assisted health systems and hospitals with financial recovery, improvements in quality outcomes, physician alignment, and patient satisfaction.

Most recently, Mr. Matthews drove the expansion of Tower Health System with the acquisition of five CHS hospitals as well as a joint venture with UPMC Health Plan for a full line of health coverage and related services to individuals as well as employers and their employees in health system’s service area.

Roxanna Gapstur, PhD, RN President and Chief Executive Officer | WellSpan Health In January 2019, Roxanna Gapstur assumed the role of President and CEO of WellSpan Health, based in York, Pennsylvania. She has over 25 years of healthcare leadership experience working in group practice, academic, and integrated health care systems which included health plan operations. Prior to her appointment at WellSpan, Dr. Gapstur was a senior vice president and president within the HealthPartners system in Bloomington, Minnesota. Dr. Gapstur has extensive experience in strategic planning, business development and operational leadership in both ambulatory and hospital settings. She has served in multiple executive roles including chief operating officer, chief nursing officer and as a senior executive accountable for population health.

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DEVELOPMENT COMMITTEE

Atlantic Health System

Tower Health System

Kevin Lenahan

Daniel Ahern EVP, Strategy and Business Development

SVP, CFO & CAO Terence French VP & Chief Strategy Officer

Hackensack Meridian Health James Blazer EVP and Chief Strategy Officer Ann Gavzy EVP and General Counsel Health Network

Gregory Sorensen, MD EVP & Chief Medical Officer

WellSpan Health Charles Chodroff, MD SVP, Population Health and Chief Clinical Officer Michael Oâ&#x20AC;&#x2122;Connor SVP and Chief Finance Officer

Lehigh Valley Health Network Edward Dougherty SVP and Chief Business Development Officer Debbie Salas-Lopez, MD Chief Transformation Officer

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GPO BOARD OF MANAGERS

Atlantic Health System

Tower Health System

Kevin Lenahan SVP, CFO & CAO

Mark McNash Vice President of Support Services

Hackensack Meridian Health

WellSpan Health

Robert Glenning President Financial Services Division and CFO

Keith Noll Senior Vice President, WellSpan Health

Lehigh Valley Health Network William Kent President, Lehigh Valley Hospital

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AHP + AH GPO COMMITTEES, COUNCILS AND WORK GROUPS

AHP Board of Managers Brian Gragnolati, CEO Atlantic Health System Anne Rooke Atlantic Health System Robert Garrett, CEO Hackensack Meridian Health Gordon N. Litwin, Esq. Hackensack Meridian Health Brian Nester, CEO Lehigh Valley Health Network John Stanley Lehigh Valley Health Network Clint Matthews, CEO Tower Health Brent Wagner, MD Tower Health Roxanna Gapstur, CEO WellSpan Health

AHP Executive Committee Brian Gragnolati, CEO Atlantic Health System Robert Garrett, CEO Hackensack Meridian Health

Edward Dougherty, SVP and Chief Business Development Officer Lehigh Valley Health Network

Greg Kile, SVP, Chief Insurance Officer Lehigh Valley Health Network

Debbie Salas-Lopez, MD, Chief Transformation Officer Lehigh Valley Health Network

George Jenckes, MD, CEO Tower Health Medical Group Tower Health Medical Group

Daniel Ahern, EVP,Strategy and Business Development Tower Health

Charles Chodroff, M.D., SVP, Population Health and Chief Clinical Officer WellSpan Health

Gregory Sorensen, M.D., EVP & Chief Medical Officer Tower Health Charles Chodroff, M.D., SVP, Population Health and Chief Clinical Officer WellSpan Health Michael O'Connor, SVP and Chief Finance Officer WellSpan Health

AHP Clinical Leadership Council Jan Schwarz-Miller, MD, MPH, Vice President, Quality and CMO Atlantic Health System Carol Barsky, MD, MBA, FAAEM, Vice President, Patient Safety and Quality Hackensack Meridian Health

Brian Nester, CEO Lehigh Valley Health Network

Thomas Whalen, MD, MMM, Chief Medical Officer Lehigh Valley Health Network

Clint Matthews, CEO Tower Health

Gregory Sorensen, MD, EVP/CMO Tower Health

Roxanna Gapstur, CEO WellSpan Health

Charles Chodroff, MD, CMO and Population Health Officer WellSpan Health

AHP Development Committee Kevin Lenahan, SVP, CFO & CAO Atlantic Health System

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Terence French, VP & Chief Strategy Officer Atlantic Health System

Kevin Joyce, VP, Insurance Networks, Business Advisory Services Atlantic Health System

Jim Blazar, EVP & Chief Strategy Officer Hackensack Meridian Health

Patrick Young, President Population Health Hackensack Meridian Health

Ann Gavzy, EVP and General Counsel Health Network Hackensack Meridian Health

Debbie Salas-Lopez, MD, Chief Transformation Officer Lehigh Valley Health Network

AHP Data Security Council Deborah Cancilla, VP & Chief Information Officer Atlantic Health System Scott Fitzgerald, Chief Information Security Officer Hackensack Meridian Health Monica Dempsey, Associate General Counselâ&#x20AC;&#x201D;Network Services Hackensack Meridian Health Joseph Mannion, MD, SVP & CIO Hackensack Meridian Health Robert Bortz, Administrator, Security & Technology Management Lehigh Valley Health Network Nicholas Fanelli, Manager, IS Security & Risk Management/ Information Services Telecommunications Lehigh Valley Health Network Richard Fronheiser, Director, IS Security Lehigh Valley Health Network Glenn Guanowsky, VP Legal Services & Risk Management Lehigh Valley Health Network Michael Minear, SVP & CIO Lehigh Valley Health Network Paul Kerr, Chief Information Security Officer, Senior Director, IT Program Management Office Tower Health Michelle Trupp, MSN, RN, CEN, Interim Chief Information Officer Tower Health R. Hal Baker, CIO WellSpan Health

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Richard Hill, Director, Technology Services WellSpan Health

Chris Deschler, RN, Clinical Quality Specialist Lehigh Valley Health Network

Holly Wolfe, MBA, Director of Clinical Improvement WellSpan Health

Michael Murphy, VP, Chief Technology Officer WellSpan Health

Lori Piltz, BSN, Clinical Quality Specialist Lehigh Valley Health Network

AH GPO Board of Managers

Michael Foley, Assistant General Counsel WellSpan Health

Gregory Sorensen, MD, EVP & Chief Medical Officer Tower Health

Michael Shrader, Manager, IS Security Operations WellSpan Health

Debra Powell, MD, Section Chief of Infectious Disease Tower Health

AHP Sepsis Clinical Initiative

Walter Bohnenblust, Jr., MD, Medical Director of Utilization Review & Quality Improvement Tower Health

Christopher Amalfitano, MD, Chair of Emergency Medicine, Overlook Medical Center Atlantic Health System John Audett, MD, CMO Overlook Medical Center Atlantic Health System Laura Anderson, MSN, RN, CIC, Director of Infection Prevention Atlantic Health System Stephen Moran, BNS, Director Quality Measurement & Improvement Atlantic Health System Robert Bayly, MD, VP Quality & Patient Safety - JFK Medical Center Hackensack Meridian Health Lisa Failace, RN, Performance Improvement Advisor, Nurse Manager, HUMC Hackensack Meridian Health Trevor Yuen, Director, Data Science & Engineering; Patient Safety and Quality Hackensack Meridian Health Matthew McCambridge, MD, SVP & Chief Quality Officer Lehigh Valley Health Network Matthew Miller, DO, Associate Chief Quality Officer Lehigh Valley Health Network Marlene Ritter, MBA, RRT, CPHQ, Director of Quality Lehigh Valley Health Network

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Bob Vance, BS, PharmD, System Director, Clinical Excellence Tower Health Mary Bilotta MSN, RN, AGCNS-BC, CEN, Clinical Program Manager Telemedicine Tower Health Renee Kozak, BS, MT (ASCP), Quality Improvement Coordinator Tower Health Charles Chodroff, MD, CMO and Population Health Officer WellSpan Health Jodi R. Cichetti, MS, RN, CCM, CPHQ, Senior Director Quality and Clinical Improvement WellSpan Health

Paul Tirjan, Chairman & CEO AllSpire Health Partners Kevin Lenahan, SVP, Chief Financial Officer Atlantic Health Robert (Bob) Glenning, President Financial Services Division & CFO Hackensack Meridian Health Bill Kent, President - Lehigh Valley Hospital Lehigh Valley Health Network Mark McNash, Vice President of Support Services Tower Health Keith Noll, Senior Vice President, WellSpan Health WellSpan Health

AH GPO Operating Committee Steve Albanese, Director, Strategic Sourcing Atlantic Health System Karl Blomback, Vice President, Materials Management Hackensack Meridian Health

Steven Delaveris, DO, VP Medical Service Line WellSpan Health

Bill Mathews, Vice President, Supply Chain Management Lehigh Valley Health Network

Lee Maddox, MD, Lead Physician, Medical Director, ICU WellSpan Health

Rita White, Senior Director, Supply Chain Tower Health

Emily Edleblute, RN, MS, ACNS-BC, CCRN-K, CIC, Program Directorâ&#x20AC;&#x201D; Medicine Service Line WellSpan Health

Jonathan (JP) Pumphrey, Vice President, Chief Supply Chain Officer WellSpan Health

Ben Proud, Senior Data Analyst WellSpan Health Kristen Thomas, Director of Population Health Analytics WellSpan Health

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Chief Operating Officer Council Amy Perry, CEO Hospital Division Atlantic Health Mark Stauder, Chief Operating Officer Hackensack Meridian Health

Craig Long, Vice President Facility Planning and Construction WellSpan Health

Kathleen DiComo, C.P.M., Strategic Sourcing and Contract Administrator WellSpan Health

Stephanie Warner,CMRP, Manager, Procurement and ContractingPurchased Services WellSpan Health

Terry Capuano, Chief Operating Officer Lehigh Valley Health Network

Facilities & Infrastructure Collaborative

Food & Nutrition Collaborative

Therese Sucher, EVP & Chief Operating Officer Tower Health

Robert Peake, VP, Facilities Management and Real Estate Atlantic Health System

Greg Merkle, Manager, Food Services Atlantic Health System

John M. Porter, Jr., EVP & Chief Operating Officer WellSpan Health

Austin Murphy, Director, Engineering Atlantic Health System

Chris Satula, Strategic Sourcing Analyst Atlantic Health System

Cardiology Collaborative Denise Noonan, Sourcing Analyst Atlantic Health System Hilary Nierenberg, MPH, APN, Administrator, Heart and Vascular Hospital Hackensack Meridian Health Elizabeth Maiorana, MBA, MSN, RN, VP Cardiovascular Services Hackensack Meridian Health Pamela Caine, Cardiovascular Business Line Manager Hackensack Meridian Health Frank Soldo, Director, Cardiovascular Hackensack Meridian Health Joanne Dinelli, Cardiac Support Supervisor Hackensack Meridian Health Vincent Tallarico, VP Heart Institute at Lehigh Valley Hospital Lehigh Valley Health Network Erma Dantonio, Contract & Product Manager Lehigh Valley Health Network James McCauley, Invasive Cardiology Business Manager Lehigh Valley Health Network James Toth, Director, Cardiovascular Program at The Reading Hospital Tower Health

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Jennifer Killinger, Clinical Resource Manager Tower Health

Vanessa Church, Strategic Sourcing Analyst Atlantic Health System Adisa Mesalic, Manager Strategic Sourcing Atlantic Health System Dustin Amato, Project Manager IV Atlantic Health System Donald Ellis, Senior VP, Facilities Management and Real Estate Hackensack Meridian Health Marilyn Daniels, Contract Specialist Hackensack Meridian Health Anthony Montalbano, Liaison HM Hackensack Meridian Health Craig Onori, VP Operations Lehigh Valley Health Network Jeff Bartholomew, Contracts and Product Manager Lehigh Valley Health Network Tamara Gates, Contract and Product Analyst Lehigh Valley Health Network Jessica Zambrana, Contracts and Product Manager Lehigh Valley Health Network David Major, P.E., CHC, CHFM, Director, Facilities & Construction Tower Health Van Popp, Senior Business Systems Analyst Tower Health

Adisa Mesalic, Manager Strategic Sourcing Atlantic Health System Irma Newdorf, Director Food Services Hackensack Meridian Health Anthony Montalbano, Liaison HM Hackensack Meridian Health Margaret Kipe, MS ED, RD, LDN, FABC, Director, Nutrition Services Tower Health Van Popp, Senior Business Systems Analyst Tower Health Timothy Bentzel, DHCFA, Dir. Food and Nutrition Services WellSpan Health Stephanie Warner,CMRP, Manager, Procurement and ContractingPurchased Services WellSpan Health

IT Collaborative Frank McKenna, Director IT Services Hackensack Meridian Health Adisa Mesalic, Manager Strategic Sourcing Hackensack Meridian Health Dorothy Acquaviva, Buyer Lehigh Valley Health Network

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Fred Armbruster, Director, Application Development and Support Lehigh Valley Health Network Van Popp, Senior Business Systems Analyst Lehigh Valley Health Network Paul Kerr, Senior Director IT Tower Health Michelle Trupp, MSN, BSN, Senior Vice President and Chief Information Officer Tower Health Doug Lehigh, Director, IT Strategic Services WellSpan Health

Laboratory Collaborative Hanna Weber, Strategic Sourcing Analyst Atlantic Health System Veronica Fraser, Director of Laboratory Services Atlantic Health System Teri Klein, Contract Analyst Hackensack Meridian Health Adam Baldwin, MS HCAD BS MT(ASCP) Regional Directorâ&#x20AC;&#x201D; Pathology Lab Administration Hackensack Meridian Health Jon Morrell, MBA, Director of Supply Chain Management Lehigh Valley Health Network Jennifer Killinger, Clinical Resource Manager Tower Health Ellen Kellom, Administrative Director of Laboratory Services Tower Health Renee Brenneman, CMRP, Contracts Administrator WellSpan Health Charles DiComo, PhD, Administrative Director, Laboratory Services, Integration & Planning WellSpan Health

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Reference Lab Workgroup Veronica Fraser, Director, Laboratory Services Atlantic Health System Maria Pedemonte, MD, Co-Chief, Pathology Atlantic Health System Adam Baldwin, MS HCAD BS MT(ASCP) Regional Director Pathology Lab Administration Hackensack Meridian Health Michael Corrigan, MBA, MT C(ASCP) DLM, Laboratory Manager Hackensack Meridian Health

Charles DiComo, PhD, Administrative Director, Laboratory Services, Integration & Planning WellSpan Health Stephen Manzella, Clinical Director of Core Laboratory, Point-of-Care testing and Support Services WellSpan Health

Nursing Collaborative Carol Jones, MSN, RN, NE-BC, Chief Nursing Officer Atlantic Health System

Alexander Ewing, MD, Director Hackensack Meridian Health

Dawn Petronio, Clinical Resource Consultant, Strategic Sourcing Atlantic Health System

Arthur Jakubczak, Laboratory Accounts Liaison Hackensack Meridian Health

Hanna Weber, Strategic Sourcing Analyst Atlantic Health System

Edwin Leschhorn, Director Hackensack Meridian Health

Linda Stanton, MBA, RN, NEBC, Administrative Director at Hackensack University Medical Center Hackensack Meridian Health

Tracy Lorne, Sr. Manager, Laboratory Services Hackensack Meridian Health Lisa McFarlane, PhD, Manager Core Lab Operations Hackensack Meridian Health Susan Sable, MT(ASCP) SM, CIC, Technical Supervisor, Microbiology Hackensack Meridian Health Dawn Soltez, Administrative Director, Laboratory Hackensack Meridian Health Ellen Kellom, Administrative Director, Laboratory Services Tower Health Robert Nystrom, Central Processing Supervisor Tower Health Renee Brenneman, CMRP, Contracts Administrator WellSpan Health Arthur Crist,PhD, Director, Clinical and Molecular Microbiology WellSpan Health

Maureen Bracher, BSN, RN, Cost Management Coordinator Hackensack Meridian Health Chris Hannon, MBA, MHA, Supervisor, Value Analysis Hackensack Meridian Health Sean McGrath, Contracts Analyst Hackensack Meridian Health Joanna McKnight, MSN, BSN, Product Nurse Specialist Lehigh Valley Health Network Janelle Alfano, MBA, Contract and Product Manager Lehigh Valley Health Network Ann Blankenhorn, MSN, Division Director Surgical and Psychiatry Tower Health Jennifer Killinger, Clinical Resource Manager Tower Health Brandon Myers, Business Systems Analyst Tower Health

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Jessica Miller, CRNA, Value Analysis Coordinator WellSpan Health Debra Weatherly, Contracts Administrator WellSpan Health

Advanced Wound Care SubCommittee Stephanie Dandrea, RN, CWON, Inpatient Coordinator Wound/ Ostomy Program Atlantic Health System Clare Hartwick, BSN, Director, Department of Surgery Hackensack Meridian Health Christine Litsch, WOCN Patient Care Specialists Lehigh Valley Health Network Judith Koch, BSN, Senior Director of Clinical Operations Tower Health Jessica Miller, CRNA, Value Analysis Coordinator WellSpan Health

Infection Prevention Sub-Committee Eloise Valencia, BSN, RN, CIC, Manager, Infection Prevention at Chilton Medical Center Atlantic Health System Gail Morchel, Lead Nurse Epidemiologist Hackensack Meridian Health Terry Burger, RN, Director Infection Prevention Lehigh Valley Health Network Susan Harahan, Infection Prevention Hackensack Meridian Health Marie Keim, BS, MT, CIC, Director Epidemiology, Infection Control and Prevention Tower Health Pamela Goodling, Manager Infection Prevention WellSpan Health

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Perinatal Sub-Committee Tracey Koplik, Clinical Specialist Atlantic Health System Jennifer Licini, BSN, RNC-OB, Administrative Supervisor Labor and Delivery and High Risk Antepartum Hackensack Meridian Health Jennifer Silva, DNP, RNC NE-BC, Vice President, Interim CNO , Good Shepherd Rehabilitation Network Lehigh Valley Health Network Lori Brittingham,MSN, RN, CNS, ACCNS-N,Neonatal Clinical Nurse Specialist Tower Health Julia Wheeling, BSN, RN, MBA, Administrator WellSpan Health

Respiratory Sub-Committee Salvatore Ruggiero, Coordinator, Respiratory Care Atlantic Health System John Perotta, MHA, BS-RRT, Manager, Respiratory Care, Pulmonary Rehab & EEG Hackensack Meridian Health Brian Sanders, Director of Respiratory Care Services Lehigh Valley Health Network Lester Cash, Director of Respiratory Care Tower Health Lyndee Knisely, MBA, RRT-ACCS, AEC, Inpatient Operations Manager, Pulmonary Services WellSpan Health

Nilesh Desai, Administrator, BS, RPh, MBA, Pharmacy and Clinical Operations Hackensack Meridian Health Richard Epstein, Vice President, Network Medication Management Hackensack Meridian Health Brian Lenich, Administrator, Pharmacy Services Lehigh Valley Health Network Michael Kleinschmidt, PharmD, B.C.P.S., Director of Pharmacy Tower Health Maegan Jefferson, 340B Contract Manager Tower Health Brett Carpenter, Senior Buyer WellSpan Health Tom Dondero, RPh, Director of Pharmacy Services WellSpan Health

Ambulatory Sub-Committee Bill Rickley, Manager, Ambulatory Pharmacy Services Atlantic Health System Elizabeth Choi, Pharmacist Hackensack Meridian Health Bob Schenk, Manager, Ambulatory Pharmacy Services Hackensack Meridian Health Chip Wukitsch, Pharmacist Lehigh Valley Health Network Kevin Bisch, Director of Pharmacy Tower Health Cindy Johannes-Beecher, Director of Pharmacy WellSpan Health

Pharmacy Collaborative Cliff Moore, MS, RPh, Director of Pharmacy Services Atlantic Health System John Telesh, Strategic Sourcing Analyst Atlantic Health System

Clinical Sub-Committee Patrick Curtin, Pharmacy Manager Atlantic Health System Maribel Pereiras, Clinical Oncology Pharmacist Hackensack Meridian Health

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Deepika Nayyar, Clinical Pharmacist Specialist Hackensack Meridian Health Jay Laskosky, Pharmacist Lehigh Valley Health Network Joan Mege, Clinical Manager, Department of Pharmacy Tower Health Rob Patti, Manager - Clinical Pharmacy WellSpan Health

Medical Safety/Reg. Sub-Committee Bill Herlihy, Supervisor, Pharmacists Atlantic Health System Sanchita Das, Medication Safety and Education Specialist Hackensack Meridian Health Lisa Antonacci, Director of Pharmacy Hackensack Meridian Health Leroy Kromis, Medication Safety Officer Lehigh Valley Health Network Maria Seitz, Quality Manager Tower Health Mary Crerand, Pharmacy Coordinator WellSpan Health

Operations Sub-Committee Doug Bloomstein, Manager, Pharmacy Services Atlantic Health System Jincy Abraham, Operations Manager Hackensack Meridian Health Christine Isler, Pharmacy Supervisor Hackensack Meridian Health Rhonda Thomas, Pharmacist Lehigh Valley Health Network Alan Portnoy, Operations Manager Tower Health Todd Fry, Pharmacy Operations Manager WellSpan Health

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Technology Sub-Committee Jim Grubel, Manager, Pharmacy Informatics Atlantic Health System Asit Gurjar, Pharmacy Informatics Hackensack Meridian Health Carl Maslag, Pharmacy Manager Hackensack Meridian Health Brad Sanford, Lead SM Lehigh Valley Health Network Jim Smith, Informatics Manager Tower Health Dave Weaver, Pharmacist WellSpan Health

PBM Workgroup William Rickley, PharmD, Manager, Ambulatory Pharmacy Services Atlantic Health System Maureen McGovern, PHR, Human Resources Coordinator Atlantic Health System Robert Schenk Jr., Manager, Ambulatory Pharmacy Services Hackensack Meridian Health Robert Liotto, Director, Total Rewards Hackensack Meridian Health Lauren Grantz, PharmD, CSP, Director, Health Spectrum Pharmacy Services Lehigh Valley Health Network Stacey Asbell, Vice President, Operations & Health Plan Management Lehigh Valley Health Network Deborah Dobrina, Director, Human Resources Lehigh Valley Health Network Joan Mege, Clinical Manager, Department of Pharmacy Tower Health Michele Bybel, Senior Benefit Analyst Tower Health

Kevin Bisch, Manager Ambulatory Pharmacy Tower Health Angela Manowczak, Wellness Coordinator, Human Resources Tower Health Cynthia Johannes-Beecher, MHA, RPH, Director of Pharmacy WellSpan Health Christina Eckert, Vice President, Chief Operating Officer WellSpan Health Jodi Gibson, Care Management Pharmacist WellSpan Health Trisha Rudisill, PharmD, Care Management Pharmacist WellSpan Health

Special Pharmacy Workgroup Cliff Moore, MS, RPh, Director of Pharmacy Services Atlantic Health System William Rickley, PharmD, Manager, Ambulatory Pharmacy Services Atlantic Health System Robert Schenk Jr, Manager, Ambulatory Pharmacy Services Hackensack Meridian Health Lauren Grantz, PharmD, CSP, Director, Health Spectrum Pharmacy Services Lehigh Valley Health Network Sean Maydick, PharmD, Supervisor, Specialty Pharmacy Division Lehigh Valley Health Network Kevin Bisch, PharmD, Director of Pharmacy Tower Health Stephanie Rusin, Specialty Pharmacist Navigator Tower Health Cynthia Johannes-Beecher, MHA, RPH, Director of Pharmacy WellSpan Health

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SELF DISRUPTION IN HE ALTHCARE DELIVERY NET WORKS

Radiology Collaborative Adisa Mesalic, Manager Strategic Sourcing Atlantic Health System Denise Noonan, Sourcing Analyst Atlantic Health System Al Kerestes, Manager, Radiology Atlantic Health System Michael Horton, FACHE, Director Diagnostic Imaging, Radiology Hackensack Meridian Health Gail Bryan, Contract Specialist Hackensack Meridian Health George Gavalla, Director Diagnostic Imaging, Radiology Lehigh Valley Health Network Erma Dantonio, Contract & Product Manager Lehigh Valley Health Network

Maureen Bracher, BSN, RN, Cost Management Coordinator Hackensack Meridian Health

Maureen Bracher, BSN, RN, Cost Management Coordinator Hackensack Meridian Health

Karl Blomback, Operating Committee Hackensack Meridian Health

Mary Clair Delbury, Nurse Manager Hackensack Meridian Health

Anthony Montalbano, Liaison HM Hackensack Meridian Health

Holli Brooks, Contract Analyst Hackensack Meridian Health

Donald Ellis, VP Facilities Hackensack Meridian Health

James Miller, CRNA, MBA, (Chair) VP, Perioperative Services Lehigh Valley Health Network

Richard Killeen, Executive Director Hackensack Meridian Health

Sue Toomey, Value Analysis Coord.

Periop Services Lehigh Valley Health Network Erma Dantonio, Contract & Product Manager Lehigh Valley Health Network

Carl Seidl, Vice President Tower Health

Karen Rutt, MSN, MHA, Operations Resource Manager Tower Health

Beverly Stoudt, Administrative Director Radiology Tower Health

Jennifer Killinger, Clinical Resource Manager Tower Health

Jennifer Killinger, Clinical Resource Manager Tower Health

Gwen Baker, Director Perioperative Care, Apple Hill Surgery Ctr. WellSpan Health

Brandon Myers, Business Systems Analyst Tower Health Jennifer Dorough, Director, Imaging Services WellSpan Health

Surgery Collaborative

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Chris Hannon, MBA, MHA, Supervisor, Value Analysis Hackensack Meridian Health

James Miller, CRNA, MBA, (Chair) VP, Perioperative Services Lehigh Valley Health Network Brian Lenich, Administrator Pharmacy Services Lehigh Valley Health Network Susan Toomey, Value Analysis Coord. Periop Services Lehigh Valley Health Network Janelle Alfano, MBA, Contract and Product Manager Lehigh Valley Health Network Bill Matthews, Operating Committee Lehigh Valley Health Network Jennifer Killinger, Clinical Resource Manager Tower Health

Value Analysis Steering Committee

Carl Seidl, Vice President Tower Health

Dawn Petronio, Clinical Resource Consultant, Strategic Sourcing Atlantic Health System

Gregory Sorensen, MD, Senior VP/ CMO Tower Health

Greg Merkle, Manager, Food Services Atlantic Health System

Rita White, Operating Committee Tower Health

Pamela Mestel, MSN, Director Morristown Surgical Services Atlantic Health System

Steve Albanese, Operating Committee Atlantic Health System

Eman Farid, MHA, Strategic Sourcing Analyst Atlantic Health System

Adisa Mesalic, Manager Strategic Sourcing Atlantic Health System

Robyn Kretzschmar, MSN, Administrative Director, Inpatient Periop Hackensack Meridian Health

Chris Hannon, MBA, MHA, Supervisor, Value Analysis Hackensack Meridian Health

Brandon Myers, Business Systems Analyst Tower Health Paul Kerr, Senior Director IT Tower Health Michelle Trupp, MSN, BSN, Senior Vice President and Chief Information Officer Tower Health

A LL SPI RE H E A LTH PA RTN E RS

SHARING STRENGTHS FOR BET TER HE ALTH

Katherine Williams, Supply Chain Business System Manager Tower Health Charles DiComo, PhD, Administrative Director, Laboratory Services, Integration & Planning WellSpan Health Chrysta Stine, Finance Liaison WellSpan Health Barry Sheibley, Senior Controller WellSpan Health Andrew Spengler, Sr. Director Supply Chain Services WellSpan Health Pamela Goodling, Manager Infection Prevention WellSpan Health Jonathan Pumphrey, Operating Committee WellSpan Health

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SELF DISRUPTION IN HE ALTHCARE DELIVERY NET WORKS

ALLSPIRE SENIOR STAFF

Paul Tirjan, MBA President AllSpire Health Partners Chairman and CEO of AllSpire Health GPO

Michael P. Forese, MBA Senior Vice President, Finance and Operations AllSpire Health Partners & AllSpire Health GPO

James W. Lederer, MD Vice President, Clinical Excellence AllSpire Health Partners

JoAnne Resnic, MBA, BSN, RN Vice President, Collaborative Initiatives AllSpire Health Partners

Rebecca Holt, MBA, BSN, RN Vice President, Clinical Resource Management AllSpire Health GPO

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A LL SPI RE H E A LTH PA RTN E RS

SHARING STRENGTHS FOR BET TER HE ALTH

Steven Burda Senior Financial Analyst | AHP Meredith Diskin Program Manager, Knowledge Transfer | AHP Abe Georges Financial Analyst | AH GPO Carmella Griffin Human Resources | AHP & AH GPO Trena Hahn, MHA, BA, RN Clinical Collaborative Coordinator | AH GPO Mary Kohlmayer Clinical Collaborative Coordinator | AH GPO Michelle Mayes, MSN, RN CNOR Clinical Resource Management | AH GPO Barbara Nicholas, DNP, MBA, RN Clinical Collaborative Coordinator | AH GPO Robert Sawyer, MHA Financial Collaborative Coordinator, Supply Chain AH GPO Beth Posse Executive Assistant | AHP Mary Rinfret Administrative Assistant | AH GPO Dhaval Shah Director, Technology & Business Solutions | AHP James Wallick Senior Director, Medical Devices | AH GPO

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ALLSPIRE HEALTH PARTNERS 484.532.5900 | www.AllSpire.org

ALLSPIRE INNOVATION JOURNAL TEAM Paul J. Tirjan President, AHP Chairman and CEO of AllSpire Health GPO Jim Lederer, MD Vice President Clinical Excellence JoAnne Resnic VP Collaborative Initiatives, AHP Michael Forese Sr. VP Finance and Operations, AHP & AllSpire Health GPO Meredith Diskin Program Manager, Knowledge Transfer Michael Hale Contributing author and editor, Innovation Journal

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