Why MEPRS Matters More Than Ever

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Why MEPRS Matters More Than Ever
Mike Dinneen, MD, PhD Strategic Planning and
Business Development Office of the Assistant
Secretary of Defense for Health Affairs
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Objectives

• Understand Department of Defense Strategic
  Direction and how expense reporting fits in.
• Understand the MHS Strategic Plan and how MEPRS
  fits in.
• Understand the critical importance of MEPRS Time
  allocation in achieving performance based
  management.
• Understand how MEPRS accounting will be modified
  to enable collection of cost and workload data in
  a manner that resembles best civilian practices.

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The DoD BSC Strategic Framework for Change
Historical World View Future Objectives
Central Planning To Adaptive and Dynamic Planning
Fixed, Predictable Threat To Capabilities Against Shifting Threats
Mature Business and Organization To Mix of New and Mature Organizations
Inputs Based Management Focus on Programs To Output Based Management Focus on Results
Appropriated Funds Cost is Free To More Market-like and price based
Segmented Information Closed Architecture To Networked Information Open Architectures
Stovepiped and Competitive Organizations Zero sum Enterprise To Aligned Organizations with common and shared objectives
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MHS Alignment with DoD Strategic Initiatives
Historical World View Future Objectives MHS Initiatives
Central Planning Adaptive and Dynamic Planning MHS Business Planning Process
Fixed, Predictable Threat Capabilities Against Shifting Threats Medical Readiness Review
Mature Business and Organization Mix of New and Mature Organizations BRAC
Inputs Based Management Focus on Programs Output Based Management Focus on Results MHS Office of Transformation LAWG
Appropriated Funds Cost is Free More Market-like and price based Prospective Payment System
Segmented Information Closed Architecture Networked Information Open Architectures CHCS II, IM/IT in support of business operations
Stovepiped and Competitive Organizations Zero sum Enterprise Aligned Organizations with common and shared objectives BRAC, Joint Operations
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The Mission and the Transformation Medical QDR

• To continue to provide the Joint Force with
  best-in-the world Operational Medicine/Force
  Health Protection (FHP) and high-quality health
  care for beneficiaries, four things must be done
• Transform the medical force so that future
  medical support
• Is fully aligned with joint force concepts and
  provides optimum
• combat service support to the joint force
• More rapidly responds to the needs of the
  changing national security environment
• Transform the infrastructure of the Military
  Health System
• Implement BRAC recommendations to reduce excess
  capacity/infrastructure and operate jointly in
  Multi-Service Markets
• Transform the business operating model to
• A fully customer-focused and performance-based
  organization, with--
• Effective processes that anticipate and respond
  to the changing nature of health care
• Transform the TRICARE benefit
• To reinforce appropriate use of resources and
  demand for services
• To engage the individual to actively manage
  his/her health

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Military Health System Mission
In Peace War
Deploy to Support the Combatant Commanders
Patient Care, Sustain Skills and Training
Promote Protect Health of the Force
to
and
Deploy Medical Force
Deploy Healthy Force
Deploy Healthy Force
Manage Beneficiary Care
Manage Beneficiary Care
Manage Beneficiary Care
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The MTFs Support all 3 Mission Elements
Force Health Protection (FHP)
Beneficiary Health Care
Homeland Defense
Other health care services not associated with
FHP training
Individual Medical Readiness
Clinical care not associated with FHP training
DNBI Prevention
Personnel Deployment
Both FHP and Beneficiary Health Care
Disease and Non-Battle Injury
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The Fog in MTF Performance

• The system cannot accurately define, measure and
  value the FHP and mission essential services
  performed by MTFs

Performance and costs not well defined or
measured
Health Care that Supports FHP Training
Individual Medical Readiness
Military-Unique Training for the Medical Force
Other health care services not associated with
FHP training
Clinical care not associated with FHP training
DNBI Prevention
Deployment

• Being defined and measured
• Primary basis for MTF funding
• Issues exist in coding and accounting

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The Price of the Fog

• System cannot separate legitimate FHP efforts,
  non-reimbursed/able healthcare, and inefficiency

59 cents of inpatient care, at the CMAC
reimbursement rate
1 for inpatient care buys
41 cents of an unknown combination of-- - Force
Health Protection capability - Non-CMAC
reimbursable health care - Inefficiency
42 cents of outpatient care, at the CMAC
reimbursement rate
1 for outpatient care buys
58 cents of an unknown combination of-- - Force
Health Protection capability - Non-CMAC
reimbursable health care - Inefficiency
Based on ASD(HA) Study, Perspectives on
Efficiency in the Direct Care System
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Some of the Keys to Transforming the Business
Model and seeing through the fog

• Standard Application of MEPRS across all Services
• Standard triservice business processes for the
  collection of labor expenses
• Full transparency of performance data, including
  MEPRS labor cost allocation
• Why?
• Because we need to know where we are investing
  our most valuable assets
• Because we want each MTF commander to have the
  tools to maximize effectiveness and return on
  investment

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Integrating MHS Strategic Transformation and
Business Planning/Operations
Outcomes
Outputs
Inputs

• Joint, interoperable deployable medical
  capabilities
• BRAC Joint MTFs and joint training
• Performance based management
• Reshaped benefit

• Fit and Protected Force
• Improved Satisfaction
• Reduced Growth in Health Care Costs for DoD
• Healthy Communities

• Level of Effort
• Full Time Equivalents and funds by project
  (initiative)
• Capital Investments

Strategic Transformation
Long-term Outcomes
Resources
Measures Critical Few

• Value Creation
• Relevant Organization
• Viable Enterprise/Entity

Measures Many
Outcomes
Inputs
Outputs

• Medical units deployed
• Healthy Communities
• Beneficiary Satisfaction
• Reduced cost per enrolled beneficiary
• Committed workforce
• Infrastructure Maintained

Level of Effort Full Time Equivalents and funds
by functional activity or program element

• Trained deployable medical units
• IMR
• RVUs / RWPs
• Trained medical staff

Business Planning/ Operations
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MHS Mission To enhance DoD and our Nations
security by providing health support for the full
range of military operations and sustaining the
health of all those entrusted to our care.

Stakeholder Perspective
Financial Perspective
Reduce death, injuries and diseases, and restore
function during and after military operations
Forces are medically ready to deploy, their
performance is enhanced through medical
interventions, and both the force and communities
are protected from medical threats
Improve satisfaction with health care
Create healthy communities
Sustain the Benefit by Managing DoD Health Care
Costs (ROI)
Customer Perspective
DoD Beneficiaries
Commanders and Service Members
Total Customer Solution
Product Leadership
It feels like the Military Health System was
designed just for me.
I am a partner with my healthcare team. They
know me and care about improving my health.
I have responsive, capable coordinated medical
services anywhere, anytime.
The MHS supports me in achieving individual
medical readiness and enhancing performance.
Internal Perspective
Mission Centered Care
Patient Centered Care
Medically Ready and Protected Force and Homeland
Defense for Communities
Manage and Deliver the Health Benefit
Deployable Medical Capability
Joint, interoperable processes efficiently move
patients and staff and deliver care anytime,
anywhere
Evidence based medicine is used to improve
quality and manage demand
Beneficiaries partner with us to improve health
outcomes
Continuous, efficient health status monitoring
focuses health improvement activities
Improved Homeland Defense
New products, processes and services are rapidly
deployed to support the mission Bench to
Battlefield
Knowledge about beneficiary health and their
customer requirements is readily accessible
The electronic medical record supports continuous
tracking and medical surveillance
Our health care processes are patient centered,
effective and efficient
One Stop Shopping for IMR activities that
improves health and enhance performance
Learning Growth Perspective
Information Capital
Human Capital
Organization Culture
Employees create success for customers
Culture of jointness and interagency cooperation
Personnel are recruited, trained, and retained to
meet requirements
Responsibility and accountability are aligned
throughout MHS
DoD Biomedical RD is coordinated and focused on
militarily relevant issues
IM/IT is leveraged to enhance capabilities
The MHS embodies performance based management and
a culture of innovation focused on results
Resource Perspective
Infrastructure is maintained and improved to
optimize performance
Resources are predictably available
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MHS Mission To enhance DoD and our Nations
security by providing health support for the full
range of military operations and sustaining the
health of all those entrusted to our care.

Stakeholder Perspective
Financial Perspective
Reduce death, injuries and diseases, and restore
function during and after military operations
Forces are medically ready to deploy, their
performance is enhanced through medical
interventions, and both the force and communities
are protected from medical threats
Improve satisfaction with health care
Create healthy communities
Sustain the Benefit by Managing DoD Health Care
Costs (ROI)
Customer Perspective
DoD Beneficiaries
Commanders and Service Members
Total Customer Solution
Product Leadership
It feels like the Military Health System was
designed just for me.
I am a partner with my healthcare team. They
know me and care about improving my health.
I have responsive, capable coordinated medical
services anywhere, anytime.
The MHS supports me in achieving individual
medical readiness and enhancing performance.
What parts of the Strategic Plan Rely on Accurate
MEPRS Data?
Internal Perspective
Mission Centered Care
Patient Centered Care
Medically Ready and Protected Force and Homeland
Defense for Communities
Manage and Deliver the Health Benefit
Deployable Medical Capability
Joint, interoperable processes efficiently move
patients and staff and deliver care anytime,
anywhere
Evidence based medicine is used to improve
quality and manage demand
Beneficiaries partner with us to improve health
outcomes
Continuous, efficient health status monitoring
focuses health improvement activities
Improved Homeland Defense
New products, processes and services are rapidly
deployed to support the mission Bench to
Battlefield
Knowledge about beneficiary health and their
customer requirements is readily accessible
The electronic medical record supports continuous
tracking and medical surveillance
Our health care processes are patient centered,
effective and efficient
One Stop Shopping for IMR activities that
improves health and enhance performance
Learning Growth Perspective
Information Capital
Human Capital
Organization Culture
Employees create success for customers
Culture of jointness and interagency cooperation
Personnel are recruited, trained, and retained to
meet requirements
Responsibility and accountability are aligned
throughout MHS
DoD Biomedical RD is coordinated and focused on
militarily relevant issues
IM/IT is leveraged to enhance capabilities
The MHS embodies performance based management and
a culture of innovation focused on results
Resource Perspective
Infrastructure is maintained and improved to
optimize performance
Resources are predictably available
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MEPRS Process Improvements

• Simplify data capture for individuals
• Lump, dont split work centers
• Standard naming of work centers
• Standard time allocation rules
• Simplified data entry
• Show people their data
• Align accountability with authority

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Why invest the time and effort to improve MEPRS
Processes

• We must MANAGE
• Provider availability for clinical care
• ? 36H
• Provider productivity
• RVU per month (MGMA or other standard)
• Clinic level profitability
• Total revenue minus total expenses
• We will be showing this data to EVERYONE.
• It will make the transition to DMHRSi much easier.

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The Civilian Model of Institutional vs.
Professional Charges

• Institutional Charges
• Pays for hospital and some clinic expenses
• Linked to DRG/RWP for IP care
• Pays for ER and APV facility expenses
• Professional Charges
• Pays for group practice expenses
• Linked to RVUs earned by providers in all
  clinical settings (IP, OP and APV)

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Why does this matter

• We are planning on fully implementing (over 3-5
  years) a system of professional and institutional
  accounting. (QDR)
• How will this affect MEPRS?
• Separate providers from other staff in order to
  create group practices. (Skill type 1 and 2)
• Ensure that all support staff attribute time
  accurately to clinical work areas in order to
  account for institutional expenses.

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Hypothetical Examples of Professional and
Institutional Monthly Financial Statements
Monthly Group Practice Profit and Loss Statement (Professional)  
Total "Revenue" 3000RVU40/RVU 120,000
Support Staff Salary Expense (MEPRS ) (45,000)
Supply Expense (5,000)
Travel Expense (4,000)
Overhead Expense (E Stepdown) (20,000)
Net Earnings 46,000
Provider Salaries (56,000)
Profit (or loss) (10,000)


Monthly Hospital Ward Profit and Loss (Institutional)  
Total "Revenue" 150RVU6000/RWP 900,000
Support Staff Salary Expense (MEPRS ) (325,000)
Supply Expense (145,000)
Travel Expense (10,000)
Overhead Expense (E Stepdown) (300,000)
Profit (or loss) 120,000
Note Q Where does the group practice revenue
come from? A All of the work done by the
providers in the group practice regardless of
where it is done!
Note Q Where does the ward revenue come
from? A All of the work done by the ward only,
(not the work that the physicians receive RVU
value for).
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What do you think?
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Synopsis

• I will show how success in strategic
  transformation in the Department of Defense and
  the Military Health System depends on accurate
  and reliable expense data.
• I will then explain how minor changes and
  improvements in the methods for capturing and
  displaying MEPRS data will allow us to compare
  performance across MTFs and benchmark with
  civilian healthcare facilities. This section of
  the brief will include an overview of the concept
  of professional and institutional charges.
• Finally, I will try to show how success in
  simplifying and standardizing MEPRS 3rd and 4th
  level names and definitions will make the
  transition to DMHRSi much easier.