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75 B U S I N E S S P RO F I L E S B U S I N E S S P R O F I L E S S P E C I A L A D V E R T I S I N G S E C T I O N provide little value, according to the alliance. In response, it has created a group-purchasing program whose collective clout allows members to save over 10% on their drug spend. e pro- gram is operated by ProCare Rx, a pharmacy benefit manager that passes along 100% of rebates and other price savings to members — eliminating the hidden mark-ups other PBMs sometimes charge. And to participate, members don't have to change the design of their health benefits or the formulary of covered medications offered to employees. • Incentivizing high-value sites of care. For some forms of health care — especially "routine" services such as diagnostic imaging, lab work and infusion therapy — location is everything. e qual- ity of care is consistently high, but where the service is delivered can make a huge difference in its cost. Some common CT scans, for example, range in average price from roughly $760 to $1,800 depending on where they are performed, with no correlation to the quality of the service. By studying insurance claim data, the HPA is working to identify the most cost-effective sites for such services. Beginning in 2019, alliance members will have access to a new shopping tool that allows them to provide stipends to incentivize their employees to choose high-value sites. Similar programs tested in markets such as New Hampshire showed that up to $5 can be saved for every $1 that's paid out in incentives. • Bundling payments and designating centers for excellence. Pricing can also vary dramatically for a lengthy course of therapy or a complex medical procedure. For example, the alliance's examination of member data showed that the average cost of a knee replacement in Maine hospitals ranges from $30,000 to $50,000 — with little or no correlation to outcomes from the surgery. e difference is partly due to opaque reimbursement structures that reward providers for the volume of services rather than for the success of an entire episode of care. To move away from this volume-based payment approach, the HPA is working to create episode-based bundles of care that will be delivered at the highest quality centers of excellence in the U.S. Purchasers will be able to pay one upfront fee for all services associated with an episode of care, and will receive a warranty that covers readmissions if the patient requires additional ser- vices. By tying payment to the outcome of the procedure, this approach has been shown to lower costs, improve outcomes and enhance patients' experience of care. Change from the roots up While work like this represents a change for the 25-year-old orga- nization, it's the result of a natural evolution, according to Hayes, who became active with the group during his Hannaford days. As the Maine Health Management Coalition, it set out to improve the measurement and effectiveness of the health care system's "Triple Aim" — better health across the population, higher quality care for the individual patient, and more affordable care for everyone. Much progress was made on the quality front, but costs continued to escalate, and in 2016 the coalition conducted an extensive self-evaluation to determine how it could be more effective. Focusing on affordability emerged as the clear priority. e coalition responded with bold action that included the new name and mission, a new purchaser-led governance structure, and new programs to incentivize high-value health care. "I think what we're doing is remaining true to our original tenets, but moving in a new direction that is more relevant and impactful today." Hayes says. "Working collaboratively across stakeholder groups is important, but health care purchasers need an organization that's devoted to them. We've never had that employer voice in Maine before." e new direction will create savings for Maine businesses and measurable change throughout the state's health care system, says Lisa Nolan, the alliance's director of value-based purchasing. "Health care is such a complex system, it's hard for an individual actor to have impact," says Nolan, who has worked on health, workforce and budget policy at both the state and federal level for over 25 years. "But if you can give a single, integrated voice to those who are paying for health care, and really care about improving value, it's actually possible to move the market." l P H O T O C O U R T E S Y O F H E A L T H C A R E P U R C H A S E R A L L I A N C E O F M A I N E P H O T O C O U R T E S Y O F H E A L T H C A R E P U R C H A S E R A L L I A N C E O F M A I N E Left: Peter Hayes, president and CEO of Healthcare Purchaser Alliance of Maine. Below: Tom Ellis, chief human resources officer at JAX and former chair of the HPA's board of directors.

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