2 men in suits shake hands

More ACOs Join CMS Program

The Centers for Medicare and Medicaid Services (CMS) announced 123 more accountable care organizations (ACOs) have joined the Medicare Shared Savings Program and will assume responsibility to provide high-quality care at lower cost, with a better patient experience for approximately 1.5 million Medicare beneficiaries.

Jordan Battani: ACOs require everyone to think differently about healthcare.
Jordan Battani said everyone, patients included, must think differently about healthcare.

“Every thoughtful healthcare organization in the U.S. is certainly worrying and thinking about this and many are right in the middle of trying to navigate this transition,” said Jordan Battani, managing director of CSC’s Global Institute for Emerging Healthcare Practices, headquartered in Falls Church, Va. She indicated no surprise at the number of organizations joining the Medicare Shared Savings Program (MSSP), but cautioned some may not realize how difficult the transition will be.

The organizations likely see it as a future trend, and with no downside risk, they may consider it a learning experience, Battani added.

Participants in the program will share in any savings resulting from better care coordination and patient engagement while meeting 33 quality metrics established by CMS.

The latest cohort includes a diverse cross-section of healthcare providers, including those delivering care in underserved areas. Physician-led organizations comprise more than half of the new ACOs. About 20 percent of the new ACOs include community health centers, rural health clinics, and critical access hospitals that serve low-income and rural communities.

WakeMed in Raleigh, N.C., has partnered with Key Physicians to form an accountable care organization called WakeMed Key Community Care; their goal is to provide comprehensive population health management services that streamline patient care coordination.

“As one of the first MSSPs in the region, we are committed to proactively educating our community about the benefits of an ACO and how this partnership allows us to deliver coordinated, high quality care,” said Debbie Laughery, spokesperson for WakeMed. “All of the practices participating in WakeMed Key Community Care are having conversations with beneficiaries at the point of care to explain how their care will benefit from sharing their information.”

An increased focus on preventive care lies at the very heart of successful population health management, Laughery continued.

“In 2014, WakeMed Key Community Care will focus on implementing a variety of patient-focused programs aimed at improving health and decreasing costs through appropriate preventive care,” Laughert explained. “At-risk patients--both in Medicare and other populations--will be proactively contacted by registered nurses to work one on one to develop personal health goals and action plans.”

In the years since the Affordable Care Act passed, 360 ACOs have joined the Medicare Shared Savings Program, serving more than 5.3 million people. Palm Beach ACO and South Florida ACO began about 18 months ago. Kelly A. Conroy, executive director of the two Florida ACOs, reported they have experienced measurable success.

ACOs participating in the Medicare Shared Savings Program represent only one flavor of ACO, as commercial insurers also seek similar arrangements, Battani said. Additionally some ACOs are accepting downside risk. Several of them left that CMS program last year.

A December 2013 report from Leavitt Partners in Salt Lake City, Utah, indicated a wide distribution of ACOs with penetration in most states ranging from 1 percent to 10 percent, with regions with a history of managed care and a dominant accountable care-oriented payer or provider having a higher penetration.

Leavitt has identified 606 different ACOs, including those working with private payers. In a Health Affairs blog, David Muhlestein, director of research at Leavitt, reported slow growth of ACOs due to several reasons, including that many of the trailblazer organizations already have created ACOs, a lack of a proven model for followers to emulate, and a reluctance of commercial payers to offer accountable care contracts.

“While the growth of ACOs, in terms of the total number of lives covered by the contracts, has been slow of late, we are aware of many organizations that are preparing to become ACOs once they see a viable model,” Muhlestein said. “This means that ACO preparations have continued rapidly, even if ACO growth has slowed.”

A fall 2013 survey of hospital executives by Premier, a healthcare improvement company in Charlotte, N.C., also noted a slower than anticipated adoption of the ACO model. In a prior survey conducted in the spring of 2012, 51.8 percent of the responding executives indicated their health systems would create or join an ACO by the end of 2013, but the results of the current survey show that only 23.5 percent will likely meet that projection.

Larger hospitals are moving toward the ACO model more quickly than smaller facilities, with rural hospitals least likely to participate.

“We expect more [ACOs] in the next couple of years,” said Alven M. Weil, MBA, spokesman for Premier. “It’s interesting to look at the type of hospitals that are already in one, and there are no surprises.”

However, participation has jumped in smaller hospitals, said Weil, adding, “We found that small hospitals are eventually as equally likely to participate in ACOs as large hospitals.”

Premier learned even hospitals not in an ACO or not planning to join one are incorporating some of the qualities of an ACO, such as providing wellness coaching, using telemedicine and embracing data collection and predictive analysis to better manage populations.

Jann Sidorov: Successful ACOs will resemble early managed care organizations.
Jaan Sidorov, MD, MSHA, said successful ACOs will resemble managed care organizations of years ago.

On the other hand, Jaan Sidorov, MD, MSHA, an independent consultant for Sidorov Health Solutions in Harrisburg, Penn., predicts many ACOs will not succeed in shaving costs, because physicians have a difficult time telling patients no. The former primary care physician and insurance company medical director described ACOs as assuming insurance risk without a history of successfully controlling healthcare utilization and requiring medical necessity. To survive they will have to incorporate managed care processes and hire people to monitor utilization, he suggested.

“Accountable care organizations are not saying, ‘no,’” Sidorov said. “It’s up to the primary care physician to say [to the patient], ‘I’m sorry.’”

Denying care falls outside the norm and the physician’s comfort zone, he explained.

“That’s why some of the early ACOs have dropped out, and more ACOs are not going to succeed,” Sidorov said. “The healthcare system is configured for action, not inaction.”

Adding to the challenge, providers cannot deliver care in one way to certain patients and another way to others based on contracts with payers, Battani said. And good practices in an ACO can be at financial odds in a fee-for-service environment.

“It’s like having one foot on the boat and one foot on the dock,” Battani explained. “We are talking about changing the way people practice medicine.”

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