3 Strategies to Help Accountable Care Organizations Boost Savings

June 10, 2019 - Accountable care organizations (ACOs) have come a long way since the Affordable Care Act (ACA). Providers have formed over 1,000 ACOs covering over 32 million patients since the law paved the way for alternative payment and care delivery models.

In that decade, ACOs have been redesigning their clinical and financial processes to improve care quality and reduce costs, and recent data shows the organizations have been successful.

ACOs in Medicare’s largest ACO program – the Shared Savings Program – generated about $314 million in net Medicare savings in 2017 while earning a mean quality score of 90.5 percent under pay-for-performance measures.

Commercial ACOs are also realizing savings and care quality improvements. For example, BlueCross BlueShield Association’s network of ACOs and patient-centered medical homes decreased care costs by 32 percent during the first half of 2018.

ACOs have started to deliver higher care quality at lower costs by building their health IT infrastructure, developing population health management programs, optimizing post-acute care, and implementing other care and cost management strategies.

READ MORE: Understanding the Fundamentals of Accountable Care Organizations

But many ACOs are finding it harder and harder to realize savings now that the organizations have picked the low hanging fruit.

The ACO model requires providers to constantly optimize care to earn shared savings payments and avoid financial penalties under evolving models that include downside financial risk.

New research shows that ACOs can better leverage their health IT infrastructure and population health management programs to continue down the path to success. Specifically, ACOs should start to target the seriously ill population for population health management, adopt a more comprehensive home visit strategy, and use health IT tools for care coordination.

ACOs identifying seriously ill, but not acting on it

Ninety-four percent of ACOs identify seriously ill patients, but only eight to 21 percent of the organizations have widely implemented initiatives to manage the population, according to new research conducted by the Duke-Margolis Center for Health Policy and Leavitt Partners.

ACOs are focusing on broader interventions rather than targeted initiatives that focus on high-risk patients, the research published in Health Affairs stated.

READ MORE: For Ongoing ACO Shared Savings, Look Outside Inpatient, Primary Care

“The central tension for the ACO is figuring out how fast they can become comfortable with going from modest steps such as identifying patients to more substantial palliative care and support interventions with confidence that they will help avoid other costs,” researchers wrote.

However, focusing on the seriously ill population could significantly reduce costs and improve care quality. Seriously ill populations are high-cost, high-utilizer patients, experiencing frequent unnecessary hospitalizations, readmissions, and emergency department visits.

The ACO model is prime for addressing the population. The model’s emphasis on care coordination can reduce unnecessary utilization. The payment structure also offers providers flexible spending to provide services that fee-for-service would not pay for, such as 24/7 access to care outside of the emergency department, patient education, and advanced care planning.

The few ACOs that are leveraging the capabilities of the model to manage the seriously ill population are seeing results, and the organizations are primarily using existing infrastructure to do so, researchers found.

For ACOs already managing the seriously ill population, providers leveraged existing complex care management and value-based care redesign initiatives to establish programs for the seriously ill population. The ACOs also connected patients to existing community resources and used social workers or community health workers for serious illness care success.

READ MORE: How Accountable Care Organizations Can Prepare for Downside Risk

Data dashboards also helped ACOs track serious illness care metrics to improve management of the population. ACOs then used the dashboards to schedule and coordinate patient care across the care continuum.

Establishing a comprehensive home visit strategy

Modern patient care moved to the hospital and physician office over a half-century ago to improve efficiency. But for ACOs, transitioning some care back into the home is proving to reduce costs and improve care quality, a new Dartmouth-led study published in Health Affairs found.

Home visits improve care quality by optimizing transitions between care settings, boosting care management, and keeping patients in their homes and out of the hospital when appropriate. Caring for patients in their homes can also reduce costs by preventing readmissions and helping patients with complex care needs to manage their conditions in lower-acuity settings.

ACOs agreed that home visits are valuable, but the use of home visits significantly varied, researchers found.

Nearly 80 percent of ACO leaders reported using home visits for care transitions within 72 hours of discharge for at least some patients. But only 25 percent of practices in ACOs said they made home visits during care transitions for patients with complex health needs.

“This discrepancy may be due to implementation processes,” researchers explained. “For example, home visits may be implemented by ACO-level centralized care management programs that are largely independent of the practices within the ACO, so that practice leaders may have limited knowledge of home visits. Or ACOs may implement home visits in some practices and not others.”

At this point, ACO strategies for implementing home visits are uncoordinated and potentially underutilized. Developing a formal implementation process and notifying all affiliated providers of the home visit strategy can help ACOs realize the full benefits of caring for patients in their homes.

The strategy has worked for MedStar Health. The Maryland-based health system developed a home visit program for high-risk geriatric patients who suffer from a physical, cognitive, or mental health disability that prevents them from going to the doctor’s office. The patients also have at least two chronic conditions.

By applying the program to a specific population, the health system decreased Medicare costs for their most expensive patients from an average of $50,997 to $44,455 in two years.

Leveraging health IT for care coordination

ACOs have spent a million dollars or more to develop the infrastructure necessary to earn shared savings and improve care quality. But a recent HHS Office of Inspector (OIG) report found that ACOs have not realized the full potential of health IT to aid care coordination.

CMS has identified care coordination as key to achieving improved care quality and lower costs, and health IT aims to help providers coordinate care to realize that goal.

However, ACOs “vary in the extent to which they can rely on health IT tools, in some cases because those tools cannot reach all providers involved in a patient’s care, or because the tools lack the necessary information that ACOs need,” the federal watchdog wrote after analyzing six Medicare ACOs.

Specifically, the analysis found that most of the ACOs used population-level analytics to inform care coordination by identifying and grouping patients according to severity and cost. But few of the ACOs used the solutions to customize care based on a patient’s individual needs.

One Medicare ACO that is successfully leveraging population-level analytics for care coordination created a registry for high-risk patients who frequent the emergency department and developed care plans for those patients. So, when a patient on the registry presents in the emergency department, an “ER Navigator” receives an alert in the EHR and can send the patient to a lower-acuity setting if appropriate.

The alert also goes to other care team members, such as the primary care physician. So, upon discharge, the care team can coordinate a treatment plan for the patient.

Realizing savings and improving care quality year-over-year can be challenging for growing ACOs. The organizations have transformed their clinical and financial infrastructure to generate quick wins and start earning shared savings payments.

But more work must still be done to continue shared savings and avoid repayment under evolving ACO models. ACOs should be evaluating their current care and cost management strategies, as well as their health IT solutions, to influence the outcomes of more patients.