MH: But if we have major changes in the insurance expansion that was part of the ACA, the financing that enables the experimentation and movement forward on value-based care gets called into question. How are you going to deal with any substantial rollback in the insurance expansion?
Gilfillan: I think they are in some regards separate issues. The financing of coverage for folks is important, and ensuring that people have the coverage and that, therefore, providers are paid when they provide service is important. But the second issue is when we do pay providers, how do we pay them? How does the payment line up, and what incentives are provided? If we can arrange those incentives so that we as healthcare professionals are rewarded for delivering what we have called the triple aim—better health, better care, lower costs—then that will be synergistic with efforts to finance insurance coverage.
MH: Before you joined Trinity three years ago, you were the head of the Center for Medicare and Medicaid Innovation, and many of the value-based reimbursement experiments, pilot projects, some even more far-reaching than pilots now, were created while you were there. What do you see as the future of the CMMI?
Gilfillan: The private sector nationally follows because the CMS is such a large payer, so the CMS has always been an innovator, but it's always been a result of legislative changes. The CMMI was set up so that we could pilot and test other kinds of approaches in addition to what the CMS was already doing and find out what worked. The results have not been as rapidly forthcoming as we would like. We want to see more, but I think we are seeing evidence that there is improvement in care, in quality, in cost and in the experience of patient care. I think—I hope—that we'll continue to see that there's value in having a nimble, well-financed research and development arm like CMMI for the CMS, and I hope they continue CMMI into the future. How they decide to implement the findings from CMMI, of course, is another question, and I think it's too early to be able to say too much about what I would expect.
MH: You have some provider pushback on efforts to push value-based care. How do you see the dynamic playing out now that the Republicans control both houses of Congress?
Gilfillan: I would say there are two issues here: One is, we need to make the ACO model more sustainable by adjusting the way benchmarks are calculated, not rebasing, and over time giving providers a larger share of the savings so that they can continue to make the investments. As it is currently constructed it doesn't provide an effective return on the investment and—many people have concluded—it just doesn't make business sense to work hard at it so far. The other issue is that ours is a very complex business. We're not facing one transformation. We are facing probably seven different major transformations in healthcare today. And I think the pushback is around saying let's be reasonable about the time periods, let's make sure the CMS can understand how their models operate, because they are very technical, and there are real issues that we are only learning about as we come live, and we want to make sure that we have time to understand how our approaches to care work.
MH: What have you been doing in trying to implement accountable care organizations and other types of payment reform structures inside Trinity? How successful have you been? And what do you see for the future of those efforts?
Gilfillan: I started at Trinity in November 2013. In early 2014, we established a couple of targets. We wanted to have a Shared Savings Program ACO in every one of our markets by Jan. 1, 2015, and we wanted to be very active in the Medicare Bundled-Payment Program. We then continued to evolve a strategy to transform the way we deliver care into a people-centered health system. So we put those alternative payment models in place to support integrated, coordinated care. Our teams have worked very hard to actually create not just the model, or the payment model, but actually create the infrastructure necessary to deliver integrated coordinated care. So, we've invested in health IT. We've invested in hiring care managers. We've invested in managed care leaders who understand these capabilities.
MH: Tell me about the collaborations you're forming with payers around these types of models or what you're doing to get into the payer space yourself.
Gilfillan: We have a Medicare Advantage Plan in Ohio and we have a partnership with Highmark in Medicaid and Medicare in Pennsylvania, but our position has been we want to be the best provider partner for every insurer in our marketplace. That means we need to have great relationships with as many payers as possible. We have markets where we have alternative payment approaches with three or four different large insurers in the market. In other places we've only been able to get those kinds of contractual relationships with a couple. Right now about 21% of all business we do goes through those alternative payment contracts, and we're seeking to grow that, and we are making progress. Although, I would love for us to be able to make more progress faster.
MH: Seventy years ago, most of Western Europe and East Asia had universal healthcare coverage. We're still not there. What is the impact on a large healthcare system like yours?
Gilfillan: We end up seeing patients later in their illness at times and with more serious illness and things that could have been treated. So, for our health system, I would say, No. 1; we need to have reimbursement arrangements that support us in providing as much integrated, coordinated care as early as we would like to for many people. It also ends up, of course, being a problem where at the end of the day—and I guess as a policymaker I've been responsible for this in the past—policymakers want healthcare providers to change a lot about what we do and to make healthcare better, make it more affordable, make it more accessible, change our IT infrastructure and have electronic health records. Lots of different things they want us to do, and it's hard in that context to change the very fundamentals about what we are doing. And so, it's easy from a policy standpoint to ask folks to do stuff, but the reality is you want us to be here. We are there 24/7. We are there whether people have insurance or don't have insurance and we have to be there, and it's right that we are there. But the impact on the healthcare system when we're providing care and not receiving any reimbursement makes it very difficult to be there in the way you want to be.
MH: Catholic Health Initiatives and Dignity Health are in talks possibly about some type of combination. What are the stresses financially that are forcing system combinations?
Gilfillan: I think the stresses are that payment rates are significantly lower, particularly through the federal programs, than they have been in the past related to the ACA, and yet we're seeing significant increasing trends on the cost of providing care. The cost of drugs, as we all know, has been really a challenge. We have shortages in nursing and with more patients insured we have increased staffing costs. So there are real cost challenges we face. We're all looking to make ourselves as effective as possible operating under Medicare-style reimbursement not knowing what the future trends will be, so we know we need to lower our costs. That's leading us to build systems that provide back-office services and allow hospitals or doctors' offices to operate more efficiently as a result of being part of those larger systems. And now we're also having to invest in these new capabilities, as we should, around population health and value-based payment systems and making those investments. It's very complex from every angle, and that complexity makes it very hard for a small system or an individual hospital to feel comfortable operating by itself.
MH: One day after the election, are you optimistic about the future?
Gilfillan: I am always optimistic about the future, yes. I believe we have our jobs cut out for us and there's an incredible amount of work to be done, but I remain optimistic because I know that there are hundreds, millions of healthcare providers who are absolutely committed to making our healthcare system better, and we will find a way to do that regardless of what the political context is.