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ACCOUNTABLE CARE ORGANIZATIONS: It is cost effective to have specialists see patients, up to a point

Some specialist involvement in care processes for patients appears to be necessary for accountable care organizations to lower their costs.”

Health care spending in accountable care organizations (ACOs) was studied based on the percent of patient visits which were provided by specialists.  Data from 620 ACOs for the period April 2012 through September 2017 were analyzed.  It was found that ACOs in which specialists provided 40 to 45 percent of office visits had the lowest expenditures.  ACOs at either extreme – the fewest or the most specialist encounters – had the highest expenditure rates.

Source: Shetty, V.A., Balzer, L.B., Geissler, K.H., and Chin, D.L. (2019, July 10). Association between specialist office visits and health expenditures in accountable care organizations. JAMA Network Open, 2(7).  Click here for free full text:  https://jamanetwork.com/journals/jamanetworkopen/fullarticle/2737841  Posted by AHA Resource Center (312) 422-2050 rc@aha.org

ACOs: Biggest accountable care organizations participating in surveys 2011 to 2015 (Modern Healthcare)

Modern Healthcare has published 5 annual editions of an “Accountable Care Organizations Survey,” which includes a list of the ACOs that participated in each survey along with the number of covered lives and participating physicians.  I thought it would be interesting to compare the results over time.  Please note that the following comments pertain only to those ACOs that participated in the survey, roughly 25 or so per year.  There are many more ACOs out there.

Trinity Health (Livonia, MI)

  • ACO formed June 2005; another ACO formed July 2014
  • 1,578,938 covered lives in 2015 (#1 in the 2015 survey)

Advocate Physician Partners (Oak Brook, IL)

  • ACO formed May 1995
  • 350,000 covered lives in 2011 (#1 in the 2011 survey)
  • 445,000 covered lives in 2012 (#2 in the 2012 survey)
  • 553,000 covered lives in 2013 (#1 in the 2013 survey)
  • 609,000 covered lives in 2014 (#1 in 2014 survey)
  • 729,000 covered lives in 2015 (#2 in 2015 survey)

Partners HealthCare (Boston)

  • ACO formed in December 2011
  • 500,000 covered lives in 2012 (#1 in the 2012 survey)
  • 550,000 covered lives in 2013 (#2 in the 2013 survey)
  • 550,000 covered lives in 2014 (#2 in 2014 survey)
  • Not on list for 2015 — did not participate?

Allina Health (Minneapolis)

  • ACO formed in January 2012
  • 250,000 covered lives in 2012 (#3 on 2012 survey)
  • 331,388 covered lives in 2013 (#3 in 2013 survey)
  • 331,388 covered lives in 2014 (#3 in 2014 survey) — yes, it is a little odd that their number is exactly the same as the previous year
  • Not on list for 2015 — did not participate?

UnityPoint Health Partners (West Des Moines, IA)

  • ACO formed in January 2012
  • 225,255 covered lives in 2013 (#4 in 2013 survey)
  • 266,000 covered lives in 2014 (#5 in 2014 survey)
  • 330,000 covered lives in 2015 (#3 in 2015 survey)

Bronx Accountable Healthcare Network (NY)

  • ACO formed 1995
  • 140,000 covered lives in 2011 (#2 in 2011 survey)

Pendulum HealthCare Development Corp. (Rockford, IL)

  • ACO formed 2010
  • 100,000 covered lives in 2011 (#3 in 2011 survey)
  • 60,000 covered lives in 2012 (#8 in 2012 survey)

Sources: These are annual surveys published by Modern Healthcare  — usually published in the magazine in a middle of July issue or an end of July issue.  You can also purchase survey results here: http://www.modernhealthcare.com/article/20110101/INFO/110819997/accountable-care-organizations-survey 

Here is the exact citation for the most current year: Headed for risk: Health systems sign private-sector accountable care organization deals that may lead to capitation. (2015, July 13). Modern Healthcare, 45(28), S1-S5.  The text is here (without the data tables):  http://www.modernhealthcare.com/article/20150711/MAGAZINE/307119980  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

ACOs: $4 million needed in start-up costs first 2 years

The National Association of ACOs has published the results of a survey of accountable care organizations (ACOs) that provides data on the start-up costs of 35 ACOs. The average first year start-up cost was found to be $2 million, with a range of $300,000 to $6.7 million.  Some start-up costs were excluded–such as feasibility studies, legal costs, and other pre-contract costs. Because of the lag time before any potential savings begin to flow back to the ACOs, the Association estimates that $4 million in start-up capital is actually needed, on average, to get through the first 24 months.  The survey also looked at estimates of the likely first-year savings prospects.

The most frequently mentioned operational problems encountered during the first year of ACO start-up were issues related to learning how to access and process data from the Center for Medicare & Medicaid Services (CMS).  Also included in this survey were questions related to information technology spending of ACOs.

Source: National Association of ACOs.  National ACO Survey, Jan. 21, 2014.  Click here: https://www.naacos.com/pdf/ACOSurveyFinal012114.pdf  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

Best performing ACO weakened by flawed model

Bellin Theda-Care Health Partners is an accountable care organization (ACO) in Wisconsin that has participated in the Medicare Pioneer ACO pilot project.  Despite doing well in the pilot project, Bellin Theda-Care has found that there are shortcomings in the Medicare ACO model that lead to decreased reimbursement.  Why?  The ACO has implemented various improvements, such as measures to decrease readmissions, that have decreased utilization for patients.  The ACO shares in savings associated with the Medicare patients, but not for the non-Medicare patients who also benefit from the improvements.  For these patients, there is a decrease in revenue, with no opportunity for the providers to share in the savings.  The authors argue for the establishment of multipayer ACOs to address this inequity.

Source: Toussaint, J., Milstein, A., and Shortell, S.  How the Pioneer ACO model needs to change: lessons from its best-performing ACO.  JAMA;310(13):1341-1342, Oct. 2, 2013.  Click here for publisher website: http://jama.jamanetwork.com/article.aspx?articleid=1745687  Posted by AHA Resource Center (312) 422-2050, rc@aha.org

How many ACOs are there? 250 and counting

Here’s one just-published answer to the popular question: “How many accountable care organizations (ACOs) are there?”  These authors, with Weill Cornell Medical College in New York, state that there are currently more than 250 ACOs and that the number increased rapidly in 2012.  They anticipate that the number will continue to grow lickety-split not only due to federal government initiatives but because commercial insurers are signing ACO-like contracts with various entities.  The authors go on to discuss the meaning of population health (buzzword alert!) and what ACOs can realistically be expected to take on in that regard.

What do I like about this article?  It’s topical.  There’s a useful quotable number in it.  Even though it is not completely free full text online, the publisher will let you see the first page for free.

Source: Noble, D.J., and Casalino, L.P.  Can accountable care organizations improve population health? Should they try?  JAMA;309(11):1119-1120, Mar. 20, 2013.  Click here for the publisher’s website: http://jama.jamanetwork.com/article.aspx?articleid=1669825  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

ACOs: Oregon experiments with coordinated care

The federal government has agreed to allow the State of Oregon to modify its Medicaid and Children’s Health Insurance Program by establishing the Oregon Health Plan, which will, among other things, set up coordinated care organizations.  The CCOs will be like accountable care organizations (ACOs), but are intended to yield cost savings more quickly.  The author describes the features of the new Oregon model and identifies features that are likely to contribute to its success or failure.

For the official site of the Oregon Health Plan, click here: http://www.oregon.gov/OHA/healthplan/pages/index.aspx 

Source: Stecker, E.C.  The Oregon ACO experiment: bold design, challenging execution.  The New England Journal of Medicine, published online, Feb. 13, 2013.  Click here for full text: http://www.nejm.org/doi/pdf/10.1056/NEJMp1214141.  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

What are the core components of an ACO?

A model of the core components of an accountable care organization (ACO) was developed as part of this research sponsored by the Commonwealth Fund.  These capabilities are grouped under the following six general headings:

  • People-centered foundation
  • Health home
  • High-value network
  • Payer partnership
  • Population health data management
  • ACO leadership

The researchers then went on to assess how various organizations interested in becoming ACOs were doing in putting these capabilities in place.  The assessment of 59 organizations found that during the mid-2010 to mid-2011 evaluation period, no ACO developer had fully implemented any of the 6 core components.  Moreover, some of the organizations had not undertaken implementation of any of the capabilities in the model.

Source: Kroch, E., and others.  Measuring Progress Toward Accountable Care.  New York: The Commonwealth Fund, Dec. 2012.  Full text free here: http://www.commonwealthfund.org/~/media/Files/Publications/Fund%20Report/2012/Dec/1652_Kroch_Measuring_Progress_web_1212.pdf  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

POPULATION HEALTH: Catholic Health Initiatives’ pilot

Catholic Health Initiatives (Denver) http://www.catholichealthinit.org/, a large multi-institutional system, is working on managing population health based on the accountable care organization (ACO) model.  The target population is CHI employees.  The model is also structured on the medical home approach.  CHI hopes to cut employee health care costs by 10 to 14 percent. 

Why I like this article: At the end, there are suggestions on how other health systems might begin to approach population health management.

Source: Sanford, K.D.  Population health management: a “start small” strategy.  Healthcare Financial Management;67(1):44-47, Jan. 2013.  Click here for more information: http://insurancenewsnet.com/article.aspx?id=370913&type=newswires  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

ACOs: Should you include a ‘surgical home’?

The American Society of Anesthesiologists (ASA) has proposed a coordinated perioperative, or surgical home, model which would give anesthesiologists a leadership role in the development of an important component of accountable care organizations (ACOs).  This is a counterpart to the medical home model (which focuses on primary care and patients with chronic disease).  ASA envisions that anesthesiologists would evolve into “perioperative physicians” in this model.

Interesting fact: An estimated 60 to 70 percent of hospital expenses are related to patients who have surgery or undergo procedures.

Sources:  American Society of Anesthesiologists.  The Perioperative or Surgical Home, Aug. 21, 2011.  Click here for full text: http://www.saaahq.org/ThePerioperative_orSurgicalHome.pdf;  Warner, M.A.  The surgical home.  Newsletter. American Society of Anesthesiologists;76(5):30-32, May 2012; and, ASA responds to accountable care organization proposed rule.  Press Release, June 3, 2011.  Click here for full text: http://www.asahq.org/For-Members/Advocacy/Washington-Alerts/ASA-Responds-to-Accountable-Care-Organization-Proposed-Rule.aspx  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org

How to predict if your ACO pilot project will succeed

Thomson Reuters has published a white paper that identifies and describes four indicators which should be tracked to predict the success of an accountable care organization pilot project.  These four indicators are:

  • How many attributed members are there?
  • What are the current ACO member utilization and payments (both in-network and out-of-network)
  • Analysis of the opportunity to reduce utilization and service unit costs
  • Analysis of ACO baseline and payer financial terms

Source: Kelley, B.  Will Your Accountable Care Organization Pilot Succeed?  Predict Success with Just Four Numbers.  Thomson Reuters, Feb. 2012.  Click here for full text (free, but registration required): http://interest.healthcare.thomsonreuters.com/content/verify?doc=http://interest.healthcare.thomsonreuters.com/content/DownloadLibrary-Provider  Posted by AHA Resource Center, (312) 422-2050, rc@aha.org