Healthcare Experts’ Top 5 Accountable Care Organization Tips
By - Accountable care organizations (ACOs) and accountable care models have existed on the forefront of the healthcare industry as an emerging and dynamic focus for healthcare providers, payers, and executives.
As recent initiatives within the past year from the Centers for Medicaid & Medicare Services (CMS) promote the advancement of such programs such as the Advance Payment ACO Model, the Pioneer ACO Model, the general collective objective – shared savings – is often a rather complicated target to hit.
As the healthcare industry continuously grapples with severe financial burdens, what evolving role do ACOs presently hold? What defines accountable care success, even as expanding ACOs themselves are essentially in a stage of development and exploration?
To help provide solutions to these questions, the following is a collection of top 5 highlights from RevCycleIntelligence.com interviews with various healthcare leaders and experts to explore what’s next on the ACO horizon and more clearly understand what best defines ACO victory.
ACO success requires engagement and alignment
According to Bruce Hallowell, Managing Director at Navigant, very few ACOs are actually successful. Neither ACOs nor capitation is a viable solution to the cost of healthcare, he maintains.
ACO success is possible, he explains. It is just a matter of prioritizing efforts and new concentrations on more innovate initiatives. “We need to look at it from a holistic standpoint, looking at the drivers of cost and just because someone’s at risk doesn’t mean the cost goes down,” Hallowell states. “If I don’t engage the rest of my partners in the delivery system, it’s going to fail. But if I can engage the rest of them, we could probably get a success,” he affirms.
What is especially problematic is that the healthcare provider industry and insurance companies, he adds, are not yet embracing this concept, even though initiatives have been implemented. Insurance companies and healthcare providers are at odds with each other, as each has a different objective, Hallowell confirms.
“An insurance company does everything in its power to limit risk. A provider does everything in its power to make money so they can pay its bills. The two don’t align with each other,” he claims. “That’s why when you look at the future, it’s going to be tough.”
The most successful ACOs embrace a clinical transformation
According to Niyum Ghandi, Partner at Oliver Wyman, as more information within the next year or so becomes available regarding what strategies the most successful ACOs and risk-bearing healthcare providers are implementing, what stands out is their commitment to care redesign.
ACO success “requires complete redesign of care, rather than just incremental changes,” Ghandi asserts. When ACOs actively invest organizational and cultural commitment in addition to money, cost savings are tangibly exceeding 10 percent and beyond, he confirms.
“One ACO that we’re aware of just finished their analysis of the first year of a number of new clinical models they deployed and the results are impressive,” he maintains. “They were able to reduce total cost of care and avoidable utilization dramatically for several different high-risk populations through complete redesign of primary and specialty care.”
Patient engagement, often ignored, needs to be an ACO focus
According to Attorney Matthew R. Fisher, Co-Chair of Mirick O’Connell’s Health Law Group, patient engagement is not yet the vital focus it needs to be within the ACO realm.
“Everyone has to buy into the process,” Fisher maintains. “There are some provisions within the Next Generation ACO Model that are trying to get individuals more engaged and tied into the process. It is a good start to addressing the issue, but there’s still work to be done.”
“If you’re dealing in a capitated system, you know the full scope of money involved and there is a lesser concern about seeking to perform more services to earn more money,” Fisher maintains, in relation to increased consumer responsibility. “You’ve got everyone trying to figure out how to work with a defined pot of money. By its nature, that type of shift in the system will help drive alignment and help drive strategies to get people working together.”
Financial accountability promotes ACO advancement
According to Richard Slavin, MD, CEO of the Palo Alto Medical Foundation, the definition of an ACO is quite variable, especially as the shift from value to volume progresses.
“I think that the most efficient long-term system is the capitated model, where there’s a finite amount allocated to the healthcare delivery system, which has to evolve to provide superb care with a predetermined fixed dollar amount per patient,” Slavin states. “ACOs are transitions from a pure fee-for-service model to a population management model.”
Patient engagement and patient education will tangibly help the healthcare industry manage costs, Slavin asserts. “Having patients aware that they’re participating in a program that’s focused on enhancing the quality of their life and the efficiency of their care is critical. It can’t be done by the organization alone. It requires patient engagement.”
Consider ACOs might not be financially beneficial
According to Farzad Mostashari, MD, ScM, Aledade Inc. Founder and CEO and former National Coordinator for Health Information Technology, the healthcare industry is not necessarily in strenuous competition regarding ACO initiatives. ACOs have perhaps not proven to be financially advantageous, he claims.
“There’s a lot of people pushing risk onto providers and the last time that happened, providers who were not prepared to take risk paid for it dearly,” confirms Mostashari. “There is appropriately a lot of concern on the part of these providers to not risk unless they’re part of something that gives them some confidence.”
The fee-for-service model, he says, is where increased competition exists. He confirms new focus should be placed on identifying what the healthcare industry needs to know and working towards filling in gaps regarding a collective lapse in regulatory understanding.
“The question is are we going to be successful, because three-quarters of people who put a lot of time, effort, and money into these alternative payment model ACO structures did not make money,” states Mostashari.
