Healthcare Analytics, Population Health Management, Healthcare Big Data

Population Health News

How Accountable Care Impacts Population Health Management

Along with big data analytics tools, accountable care and population health management make up the three critical branches of healthcare reform.

By Jennifer Bresnick

- It’s no secret that value-based reimbursement and population health management go hand-in-hand as two of the primary drivers of quality reform, but it hasn’t always been easy to get providers to embrace the risk involved in making the transition into accountable care arrangements. 

Accountable care and population health management

Both public and private value-based care initiatives and innovative care frameworks can open up providers to serious financial vulnerabilities, including up-front health IT investment costs, reimbursement cuts or penalties for failing to meet quality metrics, and ongoing maintenance costs that may run into the hundreds of thousands of dollars each year.

CMS has repeatedly come under fire for the way it has designed the Medicare Shared Savings Program (MSSP), with some critics pointing to a steady exodus from the Pioneer ACO program and mediocre results from the less strenuous ACO tracks as proof that accountable care organizations in their current form are destined to fail.

But risk is the first step towards reward, and many courageous healthcare providers are, in fact, starting to reap dividends after making the leap. 

As the Next Generation ACO initiative revives a certain measure of enthusiasm for the federal push to make value-based reimbursement a way of life for most providers accepting public payment, CMS is continuing to promote the idea that patient-centered care, coupled with data-driven population health management and the right financial incentives, can drive the care quality improvements all stakeholders wish to see.

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How do accountable care principles and value-based reimbursement interact with population health management strategies to foster better care for patients?

Building the financial foundation for change

Healthcare providers have put up some understandable resistance to idea that they should stop getting paid for the services they perform and instead only get a check when their patients get better.  Fee-for-service reimbursement offers a measure of financial stability that accountable care can’t match – especially when part of the provider’s paycheck depends on what patients do in their spare time.

But as profit margins get tighter, patients get older, chronic diseases get more common, and Medicare’s coffers start to run dry, it doesn’t take any extraordinary amount of perception to notice that the healthcare industry’s financial foundations are shifting.

CMS is aiming to make 2018 the tipping point for accountable care.  Over the next two years, they hope to convert half of all traditional fee-for-service payments into value-based reimbursements tied to quality and performance.

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The agency has had some notable success so far.  In August, CMS announced that accountable care organizations participating in the MSSP and Pioneer ACO programs had saved $411 million in 2014 and qualified for shared savings topping $422 million, results which show “that accountable care organizations as a group are on the path towards transforming how care is provided,” CMS Acting Administrator Andy Slavitt said.

Late last week, CMS Principle Deputy Administrator and Chief Medical Officer Patrick Conway, MD, added to the evidence of CMS’ success by stating that a patient-centered “health home” project in Washington State slashed Medicare spending by $21.6 million between July of 2013 and December of 2014.

According to Conway, the Medicare-Medicaid Financial Alignment Initiative “seeks to leverage Medicaid health homes to improve service quality and integration while reducing costs of care for high-risk, high-cost Medicare-Medicaid enrollees (sometimes referred to as ‘dual eligibles’) in Washington State.”

Eligible patients were automatically enrolled as beneficiaries attributed to certain participating providers, who received payments for their population health management activities according to a three-tiered structure.

The “health homes,” which mirror the care coordination techniques of the popular NCQA patient-centered medical home (PCMH) framework, received a one-time initial payment of $252.93 per patient for initial outreach and education activities, and were then allowed to collect additional payments for routine, low-level patient management ($67.50) or intensive patient care ($172.61) per month when actively engaging with the beneficiary in question.

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While the patient-centered medical home differs from an ACO in that it does not require participation in a risk-based financial program, the “per member, per month” payment strategy is a favorite for CMS, which has also used the stipend structure in some of its other patient-centered care demonstration projects.

But is a relatively small monthly payment boost or the prospect of a modest bonus at the end of a long, difficult quality improvement program enough to entice providers to abandon the security of the volume-based payment world?

Ignorance, skepticism, progress, and prudence

Unsurprisingly, the answer is both “yes” and “no.”  Healthcare providers with a shrewd sense of which way the financial winds are blowing are certainly flocking to accountable care arrangements, but they may not be very happy about it.

A new survey from the American Academy of Family Physicians and Humana Inc. shows that one in three family physicians is now actively pursuing a value-based reimbursement plan, but they have deep concerns about what it will take to succeed in this new era of accountable care.

More than ninety percent of participants said that they might lack the time required to implement a value-based care delivery framework within their practice, and 87 percent foresee a need for potentially painful levels of investment in health IT tools like EHRs, big data analytics technologies, and care coordination products. 

Eighty-one percent say that a lack of resources to support analytics and reporting already impacts their organizational sustainability.

The skeptics don’t necessarily believe that value-based payment structures will do much to improve quality, either.  More than three quarters of the survey participants think that new payment models won’t improve care.  Fifty-nine percent said these initiatives are likely to increase work for physicians without producing a beneficial result for patients.

However, the survey may be somewhat tainted by the fear of the unknown.  A quarter of respondents to the poll said that they don’t really know what their practice is doing in relation to value-based reimbursements, and 32 percent were not aware of what accountable care options are available in their target markets.

Even those already participating in value-based reimbursement were not entirely sure how the finances work.  A third of providers said they weren’t certain how incoming funds get distributed across their organizations.

The vast majority of providers feel as if they would need to see clear financial and care quality improvements in order to call accountable care participation a success, the survey added.  Practice sustainability and cost savings were high on the list, while better clinical outcomes and improved coordination of patient care were also top concerns.  Eighty-seven percent said that physician and staff morale was a key consideration when making any changes.

Developing the technology for coordinated population health management

Healthcare reform is a three-legged stool, requiring not only a financial shake-up and the organizational process changes of transforming into a patient-centered care delivery network, but also the health IT infrastructure to support these other activities.

Without robust data reporting capabilities to track quality, seamless communication pathways for care coordination, and patient engagement tools that keep consumers on the right track with their own health, truly accountable care will remain a pipe dream.

Unfortunately, many accountable care organizations can’t seem to get past some basic technological barriers.  Health IT interoperability and data integration between primary care and specialist organizations remain top concerns for nearly three-quarters of ACOs responding to a recent eHealth Initiative and Premier, Inc. survey. 

Behavioral health providers, long-term care facilities, and hospice organizations were among the most isolated from the care continuum, a situation that raises serious questions about how well accountable care organizations are addressing the social and behavioral issues that affect patient wellbeing.

CMS is jumping into the fray again by making interoperability a “deadly serious” focus for the near future as it looks past the end of the EHR Incentive Programs and towards the implementation of MIPS, a multi-faceted bundle of value-based reimbursement strategies, population health management principles, and ongoing technological improvements.

Providers who are focused on population health are likely to already have a range of health IT tools in place to help them meet these future challenges. 

From data warehouses to telehealth to dedicated big data analytics and health information exchange technologies, providers are quickly stacking the decks in their favor when it comes to the foundational IT systems that make population health management – and success with value-based reimbursement – a possibility.

Instilling a hunger for continuous improvement

Continuous improvement is a basic tenet of NCQA’s version of the patient-centered medical home, and features largely in CMS’ accountable care organization plans, as well.  Innovation is only as good as the next big idea, and the value-based reimbursement era is just getting started as far as regulators are concerned.

The ONC has championed the idea of the “learning health system” as an intelligent, interoperable, coordinated, collaborative environment in which patients thrive through data-driven, quality care delivered by technically-savvy, team-based clinicians.

The accountable care organizations is intended to be a microcosm of this vision, which will help the healthcare system develop into a “network of networks” offering better outcomes at a lower overall cost.

Financial bonuses and penalties, codified in regulatory frameworks like the EHR Incentive Programs and MIPS, have been the primary motivating factor for this transformation thus far, and they have produced indisputable results. 

EHR adoption has skyrocketed to reach the majority of healthcare providers in just six years since the inception of meaningful use, and population health management has become one of the industry’s most talked-about topics as providers retool their care processes and health IT infrastructures to put the patient first.

As CMS, Congress, and private payers continue the quest to make accountable care a core competency for the healthcare system, providers will need to start to recognize the importance of embracing value-based reimbursement as part of their foundational financial strategies if they wish to find success in an industry that is constantly reinventing itself. 


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