- Medicare and private payers have both pinned a large part of their financial hopes on developing the accountable care organization, which aims to improve coordination, cut costs, and raise quality in a fiscally responsible – but somewhat risky – manner.
While Medicare has been aggressively pursuing plans to shift the majority of its fee-for-service business into value-based reimbursement models by 2018, its Medicare Shared Savings Program (MSSP) and Pioneer ACO initiatives have come under fire in recent months as providers struggle to achieve meaningful savings on a broad scale.
Quality and performance may be on the rise for the majority of these organizations, but shared savings are harder to muster, even when patients are receiving better care.
With the news that two more Pioneer ACOs have left the ambitious but embattled experiment, participants in the less risk-heavy MSSP cohort may be wondering what their future holds if leaders in the field of value-based care cannot sustain relatively modest expectations.
Recent Pioneer dropouts, including Dartmouth-Hitchcock Health System, Steward Health Care System, and Mount Auburn Hospital, have all reiterated their commitment to the principles of accountable care, and are seeking entrance into a slightly different Medicare program.
The Next Generation ACO promises larger financial returns without some of the benchmarking flaws inherent in the older iterations of the ACO system, and may be a better match for some of these disappointed organizations.
The number of MSSP ACOs, however, continues to rise, and private payers are adding new ACO participants by the dozen each month. As more and more ACOs contribute their knowledge to the changing industry, patterns in preparation, performance, and financial potential are beginning to emerge.
What features, tools, and competencies combine to produce a successful accountable care organization? Can these organizations find a consistent way to improve quality while accruing shared savings?
Smaller systems with fewer beneficiaries
It turns out that bigger might not be better in the world of the ACO. A recent Health Affairs analysis found that accountable care organizations with fewer attributed beneficiaries in 2012 and 2013 achieved notably higher average savings, and were the most likely to significantly cut their spending relative to their benchmarks.
The trend continued into 2014, with the smallest organizations markedly outperforming their larger peers. ACOs with fewer than 6500 beneficiaries achieved average savings of 1.5 percent, while organizations with more than 20,000 attributed patients racked up just 0.5 percent on average. In 2014, just ninety-two of the 333 MSSP ACOs qualified for shared savings. They split $341 million in bonuses after helping their peers to hold spending $806 million below CMS target levels.
Physician-based ACOs are also more likely to achieve success than those with a hospital or health system at the center, suggest David Introcaso, PhD, and Gregory Berger, MPP. ACOs that include a federally-qualified health center (FQHC) or rural health clinic were also more likely to receive financial bonuses for quality improvements.
Smaller numbers may also coincide with fewer organizational resources, but providers and patients operating in a tighter, more personalized environment might benefit from a team-based atmosphere or the opportunity to develop stronger ties with patients inside and outside the clinic walls.
Adherence to innovative care improvement frameworks
The patient-centered medical home is often viewed as an important complement for the accountable care organization. The PCMH framework, along with other patient-centered care strategies, help to provide a foundation of population health management and coordinated, responsive care that can cut costs and improve patient engagement.
In Oregon’s system of sixteen coordinated care organizations (CCOs), similar in structure and purpose to the standard ACO, patient-centered medical home development is one of the key building blocks of success.
Since 2011, CCOs have more than doubled their PCMH enrollment numbers, bringing more than 80 percent of beneficiaries into the patient-centered care framework. As PCMH enrollment rose, patients and providers scored better on chronic disease management benchmarks, and were able to reduce improper use of high-cost services, like the emergency department, for routine primary care.
“We know that many of the CCOs, when a new member was enrolled, would contact the member and make them aware of who their primary care team is,” said Lori Coyner, Director of Health Analytics at the Oregon Health Authority.
“We believe that that early connection with primary care probably allowed new members to start going directly to their primary care home and not just to the emergency department because they didn’t know where to go.”
Robust health IT infrastructure and data analytics capabilities
Technology is another key component of the accountable care organization, and one that has been challenging for a broad spectrum of providers. Recent studies have found that interest in accountable care has been rapidly outpacing healthcare organizations’ ability to implement big data analytics and population health management capabilities that would best support their efforts.
Nearly a quarter of providers and 41 percent of payers said that interoperability and systems integration issues were among their greatest technical challenges in 2014, according to a McKesson Corporation survey, and approximately 20 percent of respondents anticipate running into roadblocks in relation to data collection and insight access in the near future.
“As ACOs pull data from more sources, they also report lower abilities to leverage their health IT infrastructure to support care coordination, patient engagement, physician payment and contract adjudication, population health management and quality measurement,” said a separate report from the eHealth Initiative and Premier, Inc.
“Without seamless or frictionless access to information, ACOs report significant challenges with integrating technology (88 percent) and analytics (83 percent) into workflow.”
Accountable care organizations that are able to overcome these infrastructure development issues are often able to gather important data on their patients that aids care coordination, predictive risk stratification, chronic disease management, and better clinical decision support.
Six Anthem Blue Cross ACO participants were able to save close to $8 million by investing in population health management technology, the payer announced in June. By bolstering their capability to identify high-risk patients, the organizations could more effectively target care interventions and reduce the burdens of chronic disease.
We use Anthem’s data and analytics to determine which PPO members would most benefit from this [care coordination] program and assist them,” said Dr. Daniel Bluestone, Chief Medical Officer at Santé Community Physicians IPA.
“After we identify these members, we aggressively pitch the program to the members, their doctors and other staff members,” he continued. “Once members see the benefits of ACO care coordination for themselves, they convince their doctors to become advocates of the program.”
In Oregon, collecting and analyzing clinical data from participating CCOs is a top priority, Coyner said. “We’re building a clinical data repository so that eventually, when the CCOs submit their clinical data, it will come directly there. There is also some health information exchange (HIE) coming online. There’s one that serves the southern part of Oregon, and multiple CCOs are connected there. So we have been tracking what sort of health information technology is happening.”
“One of the key pieces is that we actually provide data to the CCOs through a portal on a monthly basis,” she added. “So they see this information a lot more often than we report publicly. We track and monitor the measures so that we know where our transformations are being effective, and how we can provide learning collaboratives and other resources for some of the metrics where the CCOs aren’t continuing to show improvement.”
At Atrius Health, one of the eleven Pioneer ACOs to receive shared savings in 2014, a strong foundational EHR and a focus on health information exchange helped the physician practice-based system accrue a $2.8 million shared savings payment.
“We have the benefit of being on one instance of Epic, which means that all of our primary care practices and our specialists are all on one common electronic health record,” explained Emily Brower, Vice President of Population Health.
“That enables us to exchange and coordinate data within the Atrius Health system of care. We have also built ways to exchange information with our partnering hospitals, and are working in a similar way to try to exchange health information with our partnering skilled nursing facilities.”
“We had built our own home-grown electronic health record system way back before those were commercially available, and have always pushed as much as we can around health information exchange across settings, using everything from alerts and notifications to bi-directional viewing of records between our resources and hospital systems,” she added. “We will use pretty much whatever tools we can to improve the flow of health information across care settings.”
Long-term experience with value-based care
It may not seem like a shocking statistic, but accountable care organizations that commit to the long-haul and have more experience with value-based reimbursement are more likely to achieve positive financial results.
The latest Medicare data showed that more than a third of ACOs who joined the MSSP in 2012 produced shared savings in the most recent program year, compared to just 27 percent of 2013 ACOs and only 19 percent of organizations that signed up the following year.
“Many of [these] organizations are new to the whole business of managing care and accepting risk,” commented Dr. Jonathan Niloff, Chief Medical Officer of McKesson. So I’m not at all surprised, given the expertise and infrastructure that's required, that some of the organizations that are new to this endeavor are not generating savings early on.”
“It’s significant that they all demonstrated quality improvements,” he asserted. “Those are much easier to achieve at the beginning than the direct financial improvements. But I think it's interesting to see that the longer one has participated in the program, the greater the probability that one is accruing the clear financial savings.”
Jumping into accountable care with both feet is another way to achieve financial success and quality improvements, added Brower. Atrius Health had been transitioning to a population health management mentality long before it accepted Medicare’s accountable care propositions, which made it easier to shift away from its last fee-for-service payer holdouts.
“It’s very, very difficult to operate in both the fee-for-service and the global payment or value-based payment world, because those incentives are not aligned,” she said. “The more payers in your market that embrace value-based payment, the easier it will be.”
“It can seem somewhat paradoxical, because it can feel that it's very risky to move so fast, especially for systems that haven’t done much value-based work before, but I think it's actually less risky. I think it's harder to get results if you've only got one set of patients or one program in that model, and it actually becomes easier and less risky if you put all your eggs in one basket.”
“Once we were able to bring [our Medicare] patients and those dollars into a value-based model, it worked very well for us.”