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ACOs get down to brass tacks

There is no single "right" way of forming these organizations and every one of them is unique

John Andrews, Contributor

Although accountable care organizations are still in nascent stages in many areas of the country, a few large provider groups are ahead of the curve, getting into the nuts and bolts of how these alliances should exist, operate and perform.

What they are finding, observers say, is that there may not be one “right” way to do it. Just as the saying went when integrated delivery networks were forming in the early ‘90s, “when you’ve seen one, you’ve seen one.”

Yet there are some common threads that ACO organizers are finding, such as the massive challenge of aggregating data from disparate, siloed entities across the healthcare enterprise, said Nick Stepro, director of analytics at Burlington, Mass.-based Arcadia Healthcare Solutions.

“Over the past year, health systems engaged in ACOs or similar care models have begun to understand the real challenge of getting timely visibility into the navigation, costs and health status of their populations,” he said. “In many cases, this means integrating data from thousands of providers across dozens of EHRs, hospital systems and claims feeds. ACOs that had not invested in these type of capabilities were effectively flying blind, with no visibility into performance until it was time to submit data at year-end.”

In order to avert getting this unpleasant surprise, health systems involved in ACOs are investing in a clinical data integration strategy to enable real-time performance monitoring and care coordination, Stepro said.

“By understanding care gaps early in the contract year, these systems can get much more proactive about quality improvement and start succeeding against these contracts,” he said.

Nalin Jain, delivery director of advisory services for Buffalo, N.Y.-based CTG Health Solutions, adheres to the “every ACO is unique” viewpoint.

“The challenge is in how you see an ACO and what you want it to be,” he said. “For that, there shouldn’t be a cookie cutter approach.”

To appreciate the magnitude of difficulty involved with forming ACOs, Jain refers to the 1980s and ‘90s, when acute care entities experimented with acquiring post-acute properties, but gave up because the methodologies and reimbursement structures were too different. Now however, Jain believes these organizations have a chance at success because technology has forged better connections and fostered greater understanding about what is needed to make them work.

“If accountable care is a verb and not a noun, then you can see it is just good medicine,” he said. “In advising our clients on what is needed for ACOs, we are very clear about what lies ahead and that they should have a triple aim of maintaining a caring population and providing a positive patient experience while cutting healthcare costs.”

Jain acknowledges that the siloes and disparate systems remain a challenge, but says those are technical details to be ironed out after successfully moving toward a performance-based culture and attitude.

“You need to first get the right governing structure and get people doing the right things,” he said.

‘Internal’ ACO

One functioning ACO model is Humana, which has grown incrementally and continues to spread roots into an extended network, said Dave Caldwell, executive vice president for San Jose, Calif.-based Certify Data Systems. Although the ACO contains a complex series of moving parts, the provider-payer organization has taken a gradual, methodical approach that establishes its primary purpose and enables slow and steady growth outward.

“Humana recognizes the importance of technology and care coordination in providing the toolset they need to care for their members,” he said. “We are focused on the technology to help doctors provide better care to their patients. Other aspects are focused on risk, attribution and the financial end. There is an unmet need in the marketplace because most vendors are focused on central administrative tasks for ACOs and not on effective patient-provider discussions about the health of that patient.”

Atrius Health is another functioning ACO that is looking at issues beyond configuration into the true analytics of operation, said Brett Furst, CEO of Ann Arbor, Mich.-based Arbormetrix, which is helping the organization determine its cost structures.

“We approach risk and reliability adjustments of data, acuity of cases and price standardization by looking at claims information and getting a good bead on where cost variation exists by specialty and episode,” he said. “By running the Michigan Value Collaborative with Blue Cross for every hospital in the state, what we’ve found is that the amount of price variation is incredible within certain chronic conditions.”

For instance, there is a 69 percent variation in costs for acute myocardial infarction and 62 percent for congestive heart failure, Furst said. And while acute care-centered services typically take the blame for higher costs, he says it is not necessarily true.

“The driver is a blend of professional services usage versus inpatient and post-acute care,” Furst said. “Some of the highest costs we’ve seen were associated with over-utilizing post-acute care.”

The LTC factor

One healthcare sector that may not be reaping the full benefit of ACO partnerships is long-term care. Skilled nursing, assisted living and continuing care retirement communities are still searching for care partners in order to become viable members of the continuum. Steve Pacicco, CEO at New York-based SigmaCare, maintains that long-term care providers are indeed integral partners in the ACO environment, but participation is lagging.

“One of the most significant developments in the ACO movement over the past year has been a reduction in hospitals and physician practices’ long-term care referral networks in order to more easily coordinate care,” Pacicco said. “In fact, some organizations have reduced their long-term care referral sources from over 100 to only five.”

Even so, as ACOs gain strength, long-term care’s role will rise, said Chris Miller, senior delivery manager for CTG. Miller is helping national chain Emeritus Senior Living get positioned for when ACO development reaches that critical point.

“Whether they are assisted living or independent living, more than anything they need to be tracking their care,” he said. “They also need to establish strong relationships with hospital discharge planners.”