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Successful Integrated

Care Systems

February, 2015

CONFIDENTIAL AND PROPRIETARY


Any use of this material without specific permission of McKinsey & Company is strictly prohibited
Exhibit 7: Strong relationship between age and prevalence of long-term
Known context: aging populations drive care demand
conditions

Percent of total
100
0 conditions 69% of those
90 64% of those aged 85+
1 condition aged 75-84 have more
80 2 conditions have more than one LTC
than one LTC
3 conditions
70
4 conditions
60 5+ conditions

50
40
30
20
10
0
0-18 19-39 40-64 65-74 75-84 85+
Age
Years
SOURCE: McKinsey team analysis, HES 2010/11, FIMS, Q research/NHS Information centre, PSSEX; NHS Reference Costs

SOURCE: McKinsey team analysis, HES 2010/11, FIMS, Q research/NHS Information centre, PSSEX;
McKinsey & Company | 1
NHS Reference Costs
Integrating care: from art to professional management

1) Remarkable success on managing populations around the


world

2) All successful players do 3 things

- Understand their patient population really well

- Build new care model around the patient

- Tailor key enablers IT, payments, and workforce to their


specific local context

3) Much can be done in 2 years

SOURCE: McKinsey McKinsey & Company | 2


Successful integrated care systems exist in many countries

New York Care Montefiore Bronx


Coordination Program Pioneer ACO BCBSMA AQC

UK – Torbay UK – Tower
South Central integrated care Hamlets
Foundation Alaska UK – NWL
integrated care

UK – Greenwich

Camden Coalition of
Healthcare Providers

CareMore

Valencia: Germany -
Geisinger Integrated HC Bundesknappschaft

Colorado Australia –
Children’s Health State of Arkansas Diabetes Care
Access Program ChenMed BCBS CareFirst Project

SOURCE: McKinsey analysis of public source material; details in appendix McKinsey & Company | 3
Integrating care: from art to professional management

1) Remarkable success on managing population around the world

2) Most successful players do 3 things

- Understand their patient population really well

- Build new care model around the patient

- Tailor key enablers IT, payments, and workforce to their


specific local context

3) Much can be done in 2 years

SOURCE: McKinsey McKinsey & Company | 4


McKinsey research shows that in all these case examples, 3 building
blocks to a successful integrated care systems

Success in coordinated care

1 Understand Needs 2 Organise Delivery


Individual Multi-disciplanary
care plans teams

Care Self-
Coordi- empowerment
nation and education

3 Support with Enablers

Payment Governance Information Leadership Patient Centred

SOURCE: 40 leaders in integrated care research programme McKinsey & Company | 5


UNDERSTAND NEEDS
1 Understanding needs of population requires segmentation
Non-elective GP Annual
ad-missions contacts cost
Patient story per year per year £
▪ Joe is a healthy adult ▪ <1 ▪ 1 visit ▪ 800
▪ He rarely visits his GP
Mostly Joe, 34
1 ▪ Joe was admitted to hospital with
healthy adults No LTC
appendicitis 5 years ago but made a full
recovery

▪ Abbie is a healthy child, attending GP ▪ <1 ▪ 1 visit ▪ 650


Mostly mainly for planned appointments (e.g.
Abbie, 1
healthy 2 immunisations)
No LTC
children ▪ She receives care from GP, practice
nurses, health visitor

Elderly Frank, 79
▪ Frank has multiple long term conditions, ▪ 2 ▪ 9 visits ▪ 9,500
and is having trouble navigating disease
people with Diagnosed
3 pathways
one or more with CVD,
long term COPD and
▪ He was admitted to hospital twice this
year with complications for diabetes,
conditions diabetes
including a foot ulcer

▪ Susie was diagnosed after being ▪ 2 ▪ 5 visits ▪ 3,600


Children with Susie, 10 admitted to hospital after experiencing a
one or more 4 Diagnosed partial seizure
LTCs with epilepsy

▪ Janet was diagnosed at 19 ▪ 1 (45 day ▪ 8 visits ▪ 27,000


Janet, 25
Adults and ▪ She lives with her parents stay)
Diagnosed
elderly people 5 ▪ She has recently been discharged from
with
with SEMI hospital after a 45 day stay in the
schizophrenia
psychiatric ward

SOURCE: Example health economy, McKinsey analysis McKinsey & Company | 6


Estimated 13/14 spend per capita by segment ILLUSTRATIVE
Number of people (000) x £ym Total annual cost Average cost per capita (£)

Serious
and
Defined Intensive enduring Socially
Mostly episode of Multiple Learning continuing mental excluded
Age healthy care Single LTC LTC disability care needs illness groups

1 4 7 9 12
0-15 661 3,588 NA n/a
109.6 72.5 3.2 11.3 NA NA NA NA

2 5 8 10 11

16-74 808 4,017


NA

503.0 406.6 64.2 257.9 NA 32,081 26,729

3 6

NA NA 1.4 44.3 2.4 64.5 NA NA


75+ 4,396 9,497

12.5 55.0 13.9 131.5

Numbers represent estimates derived from the YoC database. ~65% of total cost (~£670 mln out of ~£1,043 mln) has been
linked to the segments. The remaining ~35% of CCG, NHSE and LA spending has been proportionally distributed across the
segments. The YoC database includes spend for the following settings: Acute, MH, CHS, CC, Prescribing, SC and GPs.
Excluded are specialist costs

SOURCE: Example health economy of 800.000 patients McKinsey & Company | 7


ORGANISE DELIVERY
2 Organise delivery around the person

Home-care team
▪ Provide health and
social care
multidisciplinary support Other providers
▪ Modify home ▪ Provide social and
environment to facilitate mental health input
independence where required
▪ Provide specialist advice
Named GP Individual on site and remotely
▪ Provides regular monthly ▪ Provide inpatient beds
review and same day and treatment
care when needed, 20-
40 minute appointments Other GPs
▪ High service user/GP ▪ Participate in regular
continuity review of patient care
▪ Manages list of ~450 within practice/network
service users ▪ Provide informal advice
▪ Develops trusting Individual when necessary
relationship with patient ▪ Takes ownership of care ▪ Provide peer review of
▪ Leads multidisciplinary ▪ Seeks education on condition named GP’s outcomes
team ▪ Makes decisions on best care ▪ Provide out of hours care
▪ Facilitates production to suit preferences as part of network
of care plan ▪ Self-manages some conditions

McKinsey & Company | 8


SUPPORT WITH ENABLERS
3 5 key enablers are crucial to change behaviour

Payment Information Governance Leadership Patient Centred

▪ Significant ▪ Support ▪ CEOs & ▪ Role model ▪ New ways of


(30%+) – Citizen Boards behaviour doing things
▪ At scale records commitment ▪ Deliver requires
(30%+) – Clinical of resources consistently support to
▪ Sustained decision ▪ Bind in ▪ Hold peers to learn how
(3-5 years) making payors, account ▪ Encourage
▪ Align risk and – Peer hospitals, ▪ Work within self care and
reward across pressure primary care team patient
system – Payment and local empowerment
▪ Solve government throughout
Information ▪ Hold to
governance account

SOURCE: Carter, Chalouhi, Richardson – What it takes to make integrated care work (McKinsey Health International, 2011); Latkovic - The
trillion dollar prize (Health International 2013) and Fountaine, Richardson and Wilson - Changing behaviour in primary care McKinsey & Company | 9
(Health International 2013)
Integrating care: from art to professional management

1) Remarkable success on managing population around the world

2) All successful players do 3 things

- Understand their patient population really well

- Build new care model around the patient

- Tailor key enablers IT, payments, and workforce to their


specific local context

3) Much can be done in 2 years

SOURCE: McKinsey McKinsey & Company | 10


To build a coherent population management system is 10 year+ journey,
but impact at scale can be done in 2 years (examples)

Within 2 - Activity incenting - Care packages plus


years products, e.g. OD, e.g. diabetes
Discovery - Home-telecare, e.g.
- Social marketing in Airdale
infectious diseases, - I triage, e.g. Aetna
Action e.g. PSI - System care
complete in 2 planning, e.g. stroke
years, and
time to - Smoking bans - Carve out, e.g.
impact - Urban planning, e.g. Clinicas Azucar,
MA road tax Chenmed
- Switch to episode
Fast to
based payment, e.g.
milestone,
Arkansas
but longer
- Ueber homecare
to impact
Primary prevention LTC management

Thrust

SOURCE: McKinsey McKinsey & Company | 11


Case Example – Integrated care models in
Tower Hamlets are now nationally recognised best practice
Context Approach Impact
▪ Designed a comprehensive ▪ Increased investment in
organisational development primary care from 9.4% to
programme to support groups of GP 13.8% of total spend
practices working together as networks ▪ Diabetes pilots achieved 11%
of 4-5 practices, jointly delivering care increase in people with
▪ Patients in Tower packages for diabetes and BP<140/80; 10.4% increase
Hamlets suffered immunisations. with cholesterol <4.5; 7.7%
worse outcomes, ▪ Developed care packages led by increase with HbA1c<7.5;
especially for long clinical working groups and testing 600% increase in patients with
term conditions, with patient representative groups diabetes care plans; modelling
than peers
elsewhere
▪ Facilitated design of new care delivery suggests 12-14% fall
model co-developed by GPs. This in acute spend
▪ Local CCG was required them to have joint Multi ▪ Immunisation rates rose by 50
committed to Disciplinary Teams, share patient lists, % to achieve herd immunity at
delivering significant and share resources (including being 92%
improvements in
long term conditions
paid as one group). ▪ Impact of work cited in BMJ
▪ Facilitated and ran trainings, Quality and Safety Journal 1
and public health
coaching, and other tailored support
to the clinicians, both in large group
settings and through individual visits to
practices

1 Hull et al., Improving outcomes for patients with type 2 diabetes using general practice networks: a quality improvement project in | 12
McKinsey & Company
east London, BMJ Qual Saf, 2013;0:1-6
Case example – Arkansas Medicaid has become a leader in the US
Context Approach Impact
The integrated solution for behavioral health ▪ Largest implementation of
centered on four components episode-based payment in the
▪ Behavioral health homes and patient- U.S., involving >1,000
centered medical homes to manage providers in Wave 1 across a
integrated care plan and coordinate care diverse range of medical,
▪ Arkansas undertook across settings to improve adherence and surgical, and behavioral
the design and/or align services to needs episodes: ADHD, CHF, joints,
implementation of pregnancy, upper respiratory
episode-based
▪ Behavioral health episodes: Payment
systems to increase provider accountability, infections
payments for ▪ Achieved savings of up to 22%
align interests, support accurate diagnoses
behavioral health in initial wave of episodes
and increase adoption of evidence-
conditions, maternity
and neonatal care,
informed practices ▪ Won $42M in CMS support
as well as for ▪ Independent assessment & care through a SIM Model
planning: Increase utilization of cost Testing grant
persons with
developmental effective home & community based ▪ Credited by Governor for
disabilities (DD) and services and detailed assessment to contributing to the lowest
those in need of improve care planning to better align growth rate in Medicaid
Long-Term Services services with needs and to improve spending in 30 years
and Supports outcomes
(LTSS) ▪ Provider accountability: Monitoring and
reporting to increase provider transparency
and empower continuous improvement
activities among BH stakeholders

McKinsey & Company | 13


Case Example – Through defined processes supported by innovative
technology, ChenMed has become a clear leader in elderly care
Context Approach Impact

▪ Very strong IT infrastructure ▪ 38.2% lower hospital bed days


supports care delivery, performance 18% lower hospitalization rate
management and revenue and 17% lower readmissions
optimization e.g., physicians and rates compared to national
▪ The program is patients communicate through mobile averages for patient group
aimed at low to channels outside of appointments ▪ 73% medication adherence for
middle income supported by the EMR people with diabetes,
Medicare Advantage ▪ Patients are offered high-frequency compared to 44% previously1
patients with consultations (minimum 1/month), ▪ Average Net Promoter Score
complex chronic enhanced services in a single location of 92 in 2011 (30% of patients
care needs and free transport to appointments surveyed each day)
▪ There are currently ▪ Physicians are offered small panel
36 ChenMed health sizes (typically 1:400) and financial
centers across 8 US incentives to manage patient care out-
states of-hospital
▪ Organisation is ▪ High staff-to-physician ratios
clinician-led, with support task-shifting – with onsite
strong cultures and specialists, pharmacy, diagnostic
shared values going dental and acupuncture services all
back to founder available

1 Medication possession ratio measured from 2009 to 2011 by University of Miami research team following introduction of new dispensing system
SOURCE: Health Affairs, 32, no.6 (2013):1078-1082; ChenMed website; Concierge medicine for the poorest, Forbes, 23/02/12 McKinsey & Company | 14