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Physician Leadership Key to Accountable Care Organizations

“Applicable to all accountable care organizations with regard to setting them up for success, the first core component is the organizational design and leadership governance."

By Vera Gruessner

- The world of accountable care continues to draw interest from healthcare providers and payers alike. Last month, the Centers for Medicare & Medicaid Services (CMS) announced the introduction of 121 new accountable care organizations to be part of the Medicare Shared Savings Program.

Medicare Shared Savings Program

With some of the latest results showing that only 22 percent of accountable care organizations taking part in the Medicare Shared Savings Program were actually able to cut spending and participate in shared savings payments, it’s vital to focus efforts on improving the design and operation of ACOs.

Payers would benefit from completely revamping processes to adhere to value-based care reimbursement while providers should seek more ways to enhance access to healthcare services. Including nurse care managers when patients are discharged from the hospital to post-acute care settings could be beneficial as well as having primary care clinics increase their hours of operation.

Some other steps to take to strengthen the operation of accountable care organizations include having health payers and state agencies seek greater feedback from ACO providers, assisting in care coordination, integrating mental healthcare services, and finding methods to boost health outcomes among Medicaid beneficiaries.

Gregory Scrine, Managing Principal at healthcare consulting company Lumeris, offered more ways to improve the operation of ACOs in an interview with HealthPayerIntelligence.com.

READ MORE: Should Accountable Care Organizations Include Social Services?

HealthPayerIntelligence.com: What are some of the most important aspects to include when designing an accountable care organization?

Gregory Scrine: “Several criteria need to be met in order to set up a successful and workable accountable care organization. The first core component is having the right organizational design and leadership governance. Physician engagement is key to the success of an ACO and, consequently, the efforts of setting up an ACO need to be physician-driven in order to achieve the desired results.”

Substantial physician participation and governance, including a majority of the board on a clinical-integrated network entity pursuing ACO activities is absolutely critical.”

“The second key element is securing the necessary organizational structural components. Whether this is in the context of risk-contracting on behalf of network members via the shared savings model with CMS, or a relationship with a commercial payer, having the right legal organizational set-up for the network is essential.”

The third element is a care management function that is essentially a set of resources and programs that work with member provider organizations. This set-up is centered on achieving the Triple Aim.”

READ MORE: UnitedHealthcare Partners with Accountable Care Organizations

“At Lumeris, we expanded the Triple Aim to include the concept of physician satisfaction. We call it the Triple Aim Plus One, where the Plus One refers to provider satisfaction. This recognizes the essential role providers play in setting up ACOs.”

“The fourth key element for ensuring the success of an ACO is a payer strategy and a payer market that has willing payer partners. Having access to covered lives either through a Medicare plan or through a commercial payer makes it possible to set up value-based compensation arrangements.”

“The final element is having an infrastructure for well-functioning data. Information is the oxygen that helps an ACO thrive.”

HealthPayerIntelligence.com: What can providers and payers do to improve their population health management strategies?

Gregory Scrine: “While it is fairly well-understood what needs to get done, execution remains the hard part. It goes back to having those five elements in place that I described: organizational design and leadership governance; organizational structure; the Triple Aim Plus One; a payer strategy and an informatics infrastructure.”

READ MORE: Highmark Partners with Aledade’s Accountable Care Organizations

“Partnerships with experienced organizations in the space can help organizations drive effectiveness of their execution and their strategies. We at Lumeris have helped a number of healthcare organizations set up ACOs and are happy to report that just last month KLAS Research named Lumeris 2015/2016 Best in KLAS value-based care managed services provider in the area of client-reported impact on the Triple Aim.”

“One of the ways to make those strategies more effective is to pursue scale. There’s lots of organizations that are approaching population health initiatives in somewhat of a small measure. The reality is, to be successful in the space, it requires an organization to take a relatively big swing to move the needle and make progress in these efforts. With that bigger swing comes more risk.”

HealthPayerIntelligence.com: How can providers and payers work toward really strengthening care coordination and integrating specialty care with primary care facilities?

Gregory Scrine: “The nature of specialty care is different than the role of primary care in population health management organizations. There are some ways to get initial attention from specialists. From an economic incentive perspective, creating some ENM code uplifts in initial contracting is one such example. Related to that, health organizations can also create specific measures applicable to certain specialties and get their involvement in developing those metrics for the populations they serve.”

 “As long as the incentive structure is still under development, primary care doctors will drive behavior by virtue of their referral practices.”

“Primary care physicians are going to only drive referrals to those specialists who are collaborating with their care management efforts, who are responsive, efficient,  and cost-effective. “The challenge is that this model works well in a developed market where there is a lot of diversity and a lot of options. In smaller markets, where there is a single-specialty group that dominates one specialty there is no competitive dynamic and it might be more difficult to engage specialists in behavioral changes.”     

HealthPayerIntelligence.com: Do you see the healthcare industry moving away from fee-for-service and implementing value-based care payments? Does value-based care improve the quality of medical services and cut costs?

Gregory Scrine: “Without a doubt, the industry is moving towards more value-based payment arrangements. Fee-for-service will never go away, but a growing portion of provider revenue streams and payer contracts will be value-based arrangements in some form or fashion.”

“So, does it improve quality? I believe that by definition, it has to. In the 1990s, we learned some valuable lessons about shifting risk. Providers lacked the ability to measure quality and the impact on quality and outcomes. Since then, we have made huge strides in understanding how to use data to define quality measures.”

“The Triple Aim Plus One target, which is better care at lower cost, better patient experience, and greater provider satisfaction is the path to value-based care. If done right, it creates a virtuous cycle where the right behavior and higher quality are rewarded, and it creates greater participation and incentive to move towards value-based care delivery.”

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