Accountable Care Organizations – Pilot Results
MyHealthGuide Source:
Timothy K. Lake, Kate A. Stewart, Paul B. Ginsburg, January 2011, NIHCR Research Brief No. 2
Referred by Erica Massey, Self-Insured Institute of America (SIIA)
Editor’s Note: ACOs are currently targeted at Medicare patients. However, the concept is reminiscent of the original HMO mission and ACOs could provide a medical management system consideration for self-funded employers.
Accountable Care Organizations (ACOs) are organized groups of physicians, hospitals or other providers jointly accountable for caring for a defined patient population. The goals are:
• Improve health care quality and efficiency.
• Implement changes with minimal disruption to patients and productivity.
• Constitute groups of providers (physicians, other clinicians, hospitals or other providers) to provide care and share accountability for the cost and quality of care for a population of patients.
• Payers would contract with ACOs to care for a defined group of patients, using financial incentives to encourage ACOs to meet cost and quality goals. Ultimately, policy makers hope that ACOs will improve outcomes and reduce overuse of medical care.
PPACA and Medicare
Under the Patient Protection and Affordable Care Act, Congress established the “Medicare shared savings program” to develop ACOs for patients enrolled in fee-for-service Medicare. Under the program, participating ACOs will share in any savings with Medicare if the ACO meets quality standards and cost benchmarks.
Each ACO must:
• care for at least 5,000 Medicare beneficiaries,
• establish appropriate management and leadership structures for clinical and administrative activities,
• develop processes to promote evidence-based medicine and patient engagement,
• report on quality and cost measures, coordinate care, and
• demonstrate patient-centeredness.
Mixed Results from Pilot Project
In the Medicare Physician Group Practice (PGP) demonstration, which involves 10 large physician practices across the United States, providers were offered performance bonuses based on meeting quality standards and lowering costs for fee-for-service Medicare beneficiaries. This model of incentives may be particularly relevant to incentives designed under an ACO program. However, results from the first four years of the PGP demonstration were mixed; all sites demonstrated quality improvements, but only five of the 10 practices have received performance bonuses based on savings to Medicare.
Providers Must Change How Care is Delivered
Providers must change in the way medical services are delivered and coordinated, such as
• implementing quality improvements in specific clinical areas,
• managing transitions of patients across care settings,
• improvements in care coordination, quality of care and efficiency, and
• Accept new internal payment and financial reforms, development of health information technology (HIT), information exchange, and quality reporting.
Profiled Organizations and Market Contexts
Billings Clinic, Billings, Mont., is a nonprofit health care organization that includes more than 280 multispecialty physicians and other clinicians, a hospital and other facilities. Almost all of Billings’ services are paid on a fee-for-service basis. Billings Clinic is one of the 10 practices participating in the Medicare Physician Group Practice demonstration. Interviews with Billings Clinic respondents focused on a new cancer care navigator program started in 2004 to improve cancer care coordination, patient satisfaction and outcomes.
Carilion Clinic, Roanoke, Va., includes a 600-physician multispecialty group practice and eight nonprofit hospitals. Carilion was previously a hospital-owned and -led organization called the Carilion Health System. In 2006, the Carilion Board of Directors decided that the most effective way to improve health care quality and care coordination and reduce costs was to transform Carilion into a physician-led organization. Interviews with Carilion Clinic respondents focused on development of physician payment incentives for cost and quality performance for affiliated clinicians. Carilion is one of four ACO pilots in the Brookings-Dartmouth ACO Learning Network.
Physician Health Partners (PHP), Denver, is a MSO that contracts with four IPAs–the largest includes about 180 physicians and the smallest includes about 20-25 physicians. The IPAs contract with PHP to provide IPA management, provider relations, contracting, financial and data management, and utilization and case management services. Each IPA has its own board, which makes contracting decisions and holds contracts, but the IPAs have no staff working on administrative or infrastructure-related issues. Interviews with PHP respondents focused on efforts to improve information technology infrastructure for the IPAs, including implementation and use of electronic medical records and patient registries to improve clinical integration and quality.
ProHealth Physicians, with sites throughout Connecticut, is a physician-owned, primary care organization with more than 250 clinicians in more than 75 sites across the state. Most locations are staffed by pediatricians, family practitioners and internal medicine physicians, although ProHealth also includes some specialists, such as otolaryngologists, a pediatric gastroenterologist, a sleep specialist, and various diagnostic and therapeutic services. ProHealth serves approximately 10 percent of the population of Connecticut, including Medicare and Medicaid patients, as well as patients with commercial insurance. Interviews with ProHealth respondents focused on recent HIT efforts, including electronic medical record implementation and development of a health information exchange and electronic patient registry.
Sharp HealthCare, San Diego, is a nonprofit organization with seven hospitals and other facilities and is affiliated with a 400-physician multispecialty medical group, Sharp Rees-Steely, and an IPA, Sharp Community Medical Group, with 700 physicians in private practice. Interviews with Sharp HealthCare respondents focused on several concurrent efforts to improve quality, including a disease management program for patients with congestive heart failure, efforts to improve follow-up care after hospitalization, implementation of electronic medical records, and efforts to measure and improve patient satisfaction.
UniNet, Omaha, Neb., is a PHO sponsored by Alegent Health, a hospital-based system; Creighton University Medical Center; and Creighton Medical Associates. UniNet represents more than 950 employed and independent physicians and 10 hospitals and other facilities. Interviews with UniNet respondents focused on disease management programs, a program to reduce hospital readmissions and early-stage efforts to implement electronic medical records.
Westshore Family Medicine/Mercy Health Partners, Muskegon, Mich., is an eight-physician primary care practice owned by a local hospital system, Mercy Health Partners, a part of the multistate Trinity Health System. Mercy Health Partners owns multiple physician practices in the area and has established a primary care network (PCN) and a PHO to provide billing and other administrative and logistic support to Westshore and 14 other primary care practices, although each practice operates independently. Westshore also participates in a primary care research network (PPRNet) that shares a common EMR system. Westshore implemented its EMR about 15 years ago and has used it for quality improvement. Interviews with Westshore respondents focused on efforts to improve quality of care for patients with diabetes and how the practice’s affiliations with the PCN, PHO and PPRNet help support these activities.
Care Delivery Improvements
All of the organizations studied were engaged in multiple efforts to improve care coordination and quality of care–activities likely to be pursued by ACOs. This study followed activities in two categories:
• 1) interventions to improve care delivery; and
• 2) investments in infrastructure or other organizational changes to encourage or facilitate care-delivery improvements.
Examples of Changes in Care-delivery
Sharp HealthCare, an integrated delivery system in San Diego, has begun using case managers who work with congestive heart failure (CHF) patients with highly complex medical and social needs. The case managers work primarily over the telephone, helping to coordinate medical care, as well as such community services as transportation. The program is designed to reduce CHF complications and resulting hospitalizations through early detection and management. Sharp also is working on reducing other types of hospitalizations through a continuity-of-care program, which involves calling patients within 48 hours of hospital discharge to ensure patients have follow-up visits scheduled and any drug prescriptions have been filled. Nurses also review discharge summaries with patients over the phone and answer their questions.
UniNet, a PHO in Omaha, has several initiatives to improve quality of care and outcomes among patients with diabetes and asthma, including telephone-based disease management services for English- and Spanish-speaking patients and group education classes. UniNet also is working with Blue Cross Blue Shield of Nebraska to implement a care transitions intervention to reduce readmissions, based on a model developed by Eric Coleman, including ongoing telephone contact with patients for a month after discharge. The PHO also established relationships with home health care agencies to ensure discharged patients are cared for at home when needed.
Westshore Family Medicine, part of Mercy Health Partners in Michigan, has developed a multi-faceted program to improve quality of care for patients with diabetes. The practice has hired a nurse case-manager who reminds patients to get their laboratory work done one to two weeks prior to any appointments. During the visit, the case manager meets with patients to review lab results and patients’ self-management plan, make any modifications, and refer patients to community resources as needed.
Billings Clinic, a Montana-based integrated delivery system, has developed a cancer navigation program as part of a broader initiative to develop a regional destination cancer clinic. Cancer navigators are specially trained nurses who coordinate all medical care for cancer patients, starting with efforts to make an accurate initial cancer diagnosis and development of a treatment plan. The navigators serve a central function in developing a “virtual clinic” in which patient appointments are scheduled with multiple physicians on the same day–an important feature for the many rural patients who travel considerable distances to get to Billings. The navigators accompany patients to appointments, answer patient questions, coordinate care with non-Billings providers (e.g., if patients undergo chemotherapy in their local communities), and ensure that all physicians, including patients’ primary care providers, remain informed about patients’ progress and treatments. The program was designed to improve care coordination, patient satisfaction and outcomes.
Westshore Family Medicine uses a registry developed by its affiliated physician-hospital organization and a registry function in its electronic medical record (EMR) system to track patients and ensure they receive needed services. The registries are used for enhancing delivery of preventive services and for improvement in diabetes care. While implementing registry functions, Westshore empowered medical assistants and nurses to order services flagged by the registry rather than waiting for a physician to order these services.
ProHealth Physicians, a medical group operating throughout Connecticut, has developed a data warehouse that contains information from billing and practice management systems, laboratory databases, and EMRs. ProHealth uses the data warehouse for patient registry functions, such as generating monthly reports for each physician detailing which patients need what services and comparing the physician’s performance to established quality benchmarks. The monthly reports also include “recommended actions” for each patient who is not up-to-date in receiving relevant services, as reflected in the patient-registry data.
Physician Health Partners, a Denver MSO serving four IPAs, is facilitating adoption of EMRs in affiliated physician practices, including such functions as e-prescribing and access to electronic hospital discharge summaries and laboratory and radiology results. Physician Health Partners also has supported adoption of patient registries for adults and children with several chronic conditions.
Carilion Clinic in Roanoke developed a new set of financial incentives for employed physicians based on cost and quality performance, as it transitions from a hospital-led health system to a physician-led organization, similar in structure to other prominent multispecialty clinics elsewhere. The internal payment changes are seen as part of an attempt to transform the overall strategic orientation and culture of the organization toward better coordination of ambulatory care services and greater physician leadership and accountability for cost and quality performance. The goal of this transformation was to better position the organization for ongoing and expected payment changes, such those envisioned in ACOs.
Challenges
Resistance to Change. Respondents at multiple organizations noted that people are often resistant to and fearful of change. This was particularly true in situations requiring staff to assume new responsibilities or delegate work they previously had been responsible for.
Potential Disruptions to Productivity. Many of the care-delivery and infrastructure improvements required changes in workflow that affected productivity of clinical and administrative staff. Implementing EMRs and using patient registries to ensure delivery of needed chronic disease care and preventive services often required changes in office workflow and staff responsibilities.
Limited infrastructure to pursue change. All organizations required reliable data to measure and track performance. Organizations developing patient registries often noted that the registries are only as good as the data contained in them. Thus, if the data fed into the registries are inaccurate, the registries are inaccurate and not useful for population management or obtaining performance bonuses.
Improving Incentives
Organizations found ways to align the goals of care improvement with payment and other financial incentives for affiliated clinicians. For example, several organizations working on expanding use of HIT offered stipends, grants or loans to assist practices in purchasing computer hardware and software. One of the IPAs affiliated with Physician Health Partners provided funding originally set aside for pay-for-performance bonuses to help its member practices adopt certified EMR systems. Organizations also were able to incentivize providers to improve documentation and delivery of chronic disease and preventive care services by showing how much more reimbursement they might obtain from performance-based contracts based on high quality scores. This not only encouraged clinicians to improve documentation and delivery of services but incentivized them to use data systems appropriately and further develop their infrastructure for measuring and reporting quality.
Policy Implications
In designing ACO policies, policy makers and payers should be aware that delivery system change is difficult and time consuming. Payer incentives for improved cost and quality outcomes alone may be insufficient for rapid improvements in care, especially for the majority of providers who do not face such incentives now.
One of the advantages of ACO-type payment reforms over reforms targeted at individual providers is increased patient sample sizes for reliably measuring performance. Less certain is the optimum size of an ACO to maximize organizational performance or efficiencies of scope or scale. There are concerns that the formation of very large ACOs may allow them to command too much market power, ultimately undermining the ability of policy makers and private purchasers to pursue cost-containment aims.
At the same time, establishing certain requirements or incentives for the development of specific infrastructures within otherwise diverse organizations may be beneficial or even necessary for program operations. In particular, the organizations in this study viewed the development of information systems and cost and quality reporting capacities as necessary to support care-delivery reforms. At a minimum, ACO programs may need to require certain reporting capacities to measure and reward performance.
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