Physician-Led ACOs Need Opportunities to Thrive
By - Many of the HIMSS15 educational sessions this week in Chicago offered valuable insight into the financial future of the healthcare industry.
Farzad Mostashari, MD, ScM, Aledade Inc. Founder and CEO and former National Coordinator for Health Information Technology, delivered a Wednesday HIMSS keynote session earlier this week, Key Technologies for Physician-Led Accountable Care Success, discussing the key challenges and opportunities for physician-led ACOs, solutions for physician-led ACOs in the Medicare Shared Savings Programs, and current and future developments for physician-led ACOs.
Says Mostashari, “In the first year of the Medicare Shared Savings program, 72 percent of practices that earned reimbursements were physician led. Independent primary care physicians are uniquely positioned to lead accountable care organizations but so far have least equipped to do so."
Regarding the recent Sustainable Growth Rate (SGR) repeal news, Mostashari states, “It’s huge news, not just because we’re out from under this crazy annual ritual of trying to find a way to stave off these cuts to doctor’s fees and all the crazy last minute stuff that happens. It was an amazing signal from policy makers of both parties in terms of where this country is going to get reform, not just a payment system delivery.”
Mostashari explains that although the healthcare industry was initially supposed to cut spending, this did not happen as a result. The healthcare industry now faces $180 billion of unpaid obligations, he adds.
Regarding this massive financial figure, Mostashari says, “They equalized that. They took care of that, paid for some of it. The rest they didn’t pay for. But the question is what happens from now on?”
Mostashari says although there was a push within the healthcare industry to remain within the fee-for-service realm, the industry needs to embrace one of two distinct courses of action.
The first course of action involves the average upcoming increase which will be 0.5 percent a year, says Mostashari. “But, to even earn that, you’re going to have to go through a whole battery of quality and cost measures and Meaningful Use, all sorts of stuff,” he explains.
The second course of action, maintains Mostashari, involves the push for alternative payment models.
“You’re getting 5 percent increase in your reimbursement,” says Mostashari. "Over the long run, whatever the inflation rate is going to be for those alternative payment models is going to be something like three times the allowed medical inflation rate for those non-alternative payment models.”
As time passes and the healthcare industry approaches 2018, the number of physicians and alternative payment models will steadily increase, predicts Mostashari.
“This thing is going to go vertical because everyone’s going to want to be in an alternative payment model as defined by the secretary. Never bet against the House,” he states.
Regarding the Department of Health and Human Services (HHS) Secretary Sylvia Burwell’s announcement last January for half of all Medicare payments to transition towards alternative payment models by 2018, Mostashari says there was a great deal of initial industry skepticism regarding this announcement. As a result, priorities are changing.
“Everyone is figuring out when the patient gets sick, we’ll do anything. We’ll help you. Let him get the stroke and then we will do literally anything,” says Mostashari. “We will spare no expense.”
Mostashari ponders who will be situated at the forefront of the industry as it transitions forward.
“Is it going to be the incumbents? The people who’ve built their structures, their work flow, their culture, on this model?” he asks. “Or is it going to be new players who can be more agile, more nimble for whom saving that person going over the waterfall does not demand destruction?”
Mostashari says it is the primary providers who maintain the ability to act independently.
“The question isn’t is half of all payment going to go into alternative and value based payment," he states. "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. They didn’t save money."
Mostashari says such issues are one that require active and immediate within the next two to three years as the industry continuously strives for success.
Mostashari adds physicians have been hesitant to embrace population health management, generally thinking the adaption means hindering a practice in an abundance of dreaded red tape. Mostashari says physicians widely feel population health management does not relate to their business model and inhibits their ability to see patients and get paid for doing so.
“Where is there a window in American healthcare where what’s good for the patient and good for society is good for the doc?” Mostashari asks. “I thought maybe this physician ACO thing might be it.”
Mostashari confirms any brewing competition within the healthcare industry is not among ACOs but between everyone who is privy to smoothly executing the fee-for-service model.
“There’s an incredible amount of sharing and openness,” says Mostashari. “There’s a lot of primary care docs out there who just can’t do this on their own. They just can’t. They don’t have the capital. They don’t have the tools. They don’t have the data analytic to understand. They don’t have the regulatory understanding. But you know what? We can do that.”
Mostashari says new focus should be placed upon success, validating what the industry knows, and also admitting and addressing what it needs and wants to know.
“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,” says 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.”
Mostashari says it is vital to additionally focus on population health competency to best identify and manage those beneficiaries categorized as high risk as they are generally the most expensive patients. Mostashari reminds the industry at large such patients cannot be perceived via a singular, one-size-fits-all approach.
“Are people’s problems on one dimension? What are you going to do about the patient who you identify as a high risk patient who just got diagnosed with pancreatic cancer?” Mostashari asks. “You need to put people among multiple dimensions that are tied to doing something about it. “
Mostashari says the highest cost patients are oftentimes ones that the healthcare industry has let down.
“Oftentimes, you can’t do anything about those people. It’s too late,” Mostashari confirms. “All the springs have come loose. We failed them.”
Mostashari says identifying the people who are going to potentially be high cost patients that can respond well to quality care requires actively identifying algorithms.
“That’s what those highest cost patients today are. They are the end state of when we have failed the patient through so many steps,” he confirms. “To try to bring that back is really important. Let’s try to identify what the patterns are.”
Mostashari remarks the healthcare industry should attempt to identify those patients who are going to be high cost where clinical data, clinical intuition, and patient recorded data can enact positive change. The future of the healthcare industry, at large, he says, depends on taking the aforementioned actions now to ensure future success as a collective, dedicated whole.
