7-3-13 Valley Health and Inova alliance

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On July 2, Valley Health System and Inova announced a strategic alliance between the 2 independent health systems that centers on information technology, population health management and clinical program development.

Alliance FAQ

Are we continuing as independent health systems?

Yes. Each health system will remain independent, separately governed and separately managed. Neither health system will have representation on the other system’s board. Each will remain financially separate.

What is covered under the alliance?

We have identified several areas of mutual interest where we can do more together than we can separately. Initial areas targeted for collaboration include: Information technology; Managed care and population health management; Research and clinical trials; Supply chain; Clinical program development.

Why this? Why now?

The health care industry is facing significant changes in the way patient care is evaluated and reimbursed. Historically, providers were paid based on the amount of care provided. Moving forward, however, that payment is going to be based on the value provided and health outcomes of the patient.

In anticipation of these sweeping changes, the Valley Health Board of Trustees and management team over the past 2 years have been evaluating the benefits of pursuing strategic alliances that would position us more favorably for the future of health care.

In this dynamically changing environment, Valley Health recognizes the need to embrace relationships that position our system for continued success, especially in areas critical to our future. The alliance with Inova enables collaboration as outlined but which also allows independence. Other options considered involved greater integration. Inova also offers expertise in areas targeted for advancement by Valley Health. Remaining independent does not mean we do everything alone. In fact, collaboration is a core value for Valley Health System’s 2013-2018 Strategic Plan.

Because of the multiple external pressures on Valley Health and the need to constantly improve the quality and value of our services, we recognize a need to strengthen our capabilities to help patients manage their health. Building alliances to foster the development of these capabilities is becoming an imperative for us.

What is the impact of this alliance to medical staff?

Alliances with large referral centers and academic medical centers provide opportunities to support our excellent medical staff and provide access for the members of our community to additional expertise and additional physician resources required for improved clinical decision making.

The press release says, “We will look at appropriate opportunities for clinical integration with our major service lines.” What does this mean?

Our patients need to be at the center of all we do. Our mission and vision statements affirm our commitment to improving the health of our community and looking at innovative ways to accomplish this. As our service line plans are developed, we may identify gaps in services that Inova can help us fill. For example, there may be niche specialties we have been unable to fill at any one of our facilities. We may be able to work with Inova to provide this coverage locally. Additionally there may be services Valley Health can offer that are not readily available in Inova’s market area.

Are alliances new for Valley Health?

Alliances and partnerships are not new to Valley Health. Over the years we’ve had numerous relationships. We worked with Grant Memorial Hospital for many years. In 2013 we formed a partnership with the University of Virginia for a Stereotactic Radiosurgery program in Winchester. The Family Practice Residency Program in Front Royal is in collaboration with VCU. Each example represents a win-win situation for all participants.

How does Inova benefit?

Inova appreciates the strengths we offer. While Inova is urban, we understand rural health and the operation of critical access hospitals. They recognize we have much to offer them in our experience with seniors in post-acute and long-term care settings. Our bariatric medicine program is highly regarded, as are the performances of our cath lab team and our cardiac surgeons. Like Inova, we also serve our community through a trauma center and newborn intensive care unit.

How does Valley Health benefit?

As we enter into the new world order created for healthcare by the Affordable Care Act (ACA), we gain an ally. Through the partnership we gain access to a capital-intensive Information System platform at less cost. The expectations of the ACA are that we will participate in health exchanges and form an Accountable Care Organization to benefit the people we serve. Working with Inova we also can take advantage of other opportunities that come from leveraging our two organizations in the managed care environment. Additional clinical services may be added as we explore opportunities.

Why are we switching to a new Information System?

A robust information system is essential to develop and manage the safety, quality and population management expectations of health systems in the 21st century.

The search for a new information system began when McKesson let us know they would cease further development of the suite of products in current use. After a review of replacement options, we identified Epic as the first choice of the health system’s medical, nursing and IT staff. Inova came to a similar decision to invest in Epic in 2011, and is in the process of deploying it across its health system.

Who and what is Epic?

Epic is a health care software developer and vendor that offers an integrated suite of health care software. Their applications support functions ranging from registration and scheduling; clinical systems for physicians, nurses and emergency personnel; systems for lab technicians, pharmacy and radiology; and billing systems. Epic is installed in many world-class health systems in the United States and around the world. Estimates are that 35 percent of the population of the United States has some component of their medical record in an Epic system.

Working with Inova we are able to save a considerable amount of money on acquisition and implementation costs, as well as tapping into the expertise and experience of those from Inova who have gone before us. Epic recognizes that midsized health systems with regional neighbors (like Valley Health and Inova) can accomplish more aligned than not aligned. Epic endorses organizations like Inova extending their software to Valley Health. This IT component of this alliance between Inova and Valley Health System is being sanctioned, certified and overseen by Epic.

What will the cost be for the Epic adoption?

Installing Epic is a huge organizational commitment in terms of resources and capital. Valley Health will invest an estimated $160 million over the next 10 years. This represents a material savings over its cost had we not aligned with Inova.

Will Epic be used by all Valley Health inpatient and outpatient entities and VPE?

Yes. The plan is to bring the VPE physicians up first, followed by all 6 VHS hospitals. The first phase also includes all revenue cycle applications, all registration and scheduling applications, all clinical charting applications, CPOE and portal applications for physicians.

When will Epic be implemented?

We fully expect to be on Epic in time for ICD-10 — either by late summer or early fall of 2014.

What is the impact of the Epic installation to all of us within Valley Health?

With our implementation of Epic we are doing more than just replacing systems and automating processes: we are unifying and standardizing our focus around the patient’s experience.

Many of you will participate in validation sessions, training sessions and support sessions in which our charge will be to think less about our individual facilities and more about what is best for our patients and Valley Health as a whole. Our goal with Epic is to build a new foundation for collaboration, create shared accountability for process and outcomes and develop the tools we need to adapt to a rapidly changing healthcare environment.

What should we say to patients, family members and community members?

As a health system, and as an industry, we need to be nimble. This alliance provides us with an opportunity to tap the resources and expertise of Inova on a number of important levels, including the deployment of a crucial information system. The expectations of the Affordable Care Act are that we will participate in health exchanges and form an Accountable Care Organization to benefit the people we serve. Aligning ourselves with another organization responding to these expectations makes sense.

What is an Accountable Care Organization (ACO)?

The Centers for Medicare and Medicaid Services (CMS) defines an ACO as: A group of health care providers who give coordinated care, chronic disease management and thereby improve the quality of care delivered to patients. The organization’s payment is tied to achieving health care quality goals and outcomes that result in cost savings.

What will this do to help us respond to provisions in the Affordable Care Act?

As a system we need to be ready to participate in the health exchanges that are established, whether public or private. We have some experience in this area through our participation in Optima, and we may be able to work with Inova in its relationship with Innovation Health, a population management venture between Inova and Aetna. There may also be opportunities to participate in managed Medicaid products in the future.

Will this alliance have any noticeable impact on Valley Health employees? Will there be layoffs?

We will continue to operate independently with separate Boards and leadership teams. We do not anticipate layoffs as a result of this alliance. The immediate impact should not be noticeable except for the support we will receive from Inova during the Epic implementation.

Insurance products are mentioned as an area we may work with Inova. Will this affect me?

Valley Health has not yet investigated the potential insurance product partnership with Inova and whether it will enable us to offer health benefits in a more affordable way to our employees — and possibly others in our community.

The impact of health reform on the cost of health insurance is of great concern among all employers in the country today. In fact, employers are likely to see higher cost increases next year to offer the same benefits they have in place today due to the tax liability being imposed through health reform. As a result, Valley Health is reviewing its health benefit options and cost structure and will make changes in 2014 and beyond to ensure we can provide competitive health benefits at a reasonable cost to our employees. We will not know what these changes look like until the July/August timeframe.

Will Valley Health employees who receive care at an Inova facility be eligible for a discount?

Not at this time. This may be an area for further exploration.

Will Inova be performing tasks for Valley Health currently completed by our employees? (i.e. consolidation of jobs/positions)

Not at this time. This may be an area for further exploration.

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