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Value-Based Care News

Population Health Management Helps ACOs Earn Shared Savings

Accountable care organizations facing difficulty in generating shared savings are advised to implement population health management strategies.

By Vera Gruessner

Continually rising medical costs without significant benefits to patient care have led both public and private payers to invest in value-based care payment structures such as accountable care organizations (ACOs). However, when payers and providers come together to operate through an accountable care organization, they often find the process complex especially with regard to earning shared savings and facing higher levels of financial risk.

Accountable Care Organizations

When looking at 2015, only half of Pioneer Accountable Care Organizations were able to earn shared savings. Also, 125 ACOs taking part in the Medicare Shared Savings Program out of a total 400 accountable care organizations generated shared savings last year. This shows how payers and providers operating ACOs will need to find solutions to address the difficulty of earning shared savings in order to keep hospitals and practices from abandoning accountable care.

Population health management could be one way that ACOs generate greater shared savings in subsequent years, according to a report from the American Hospital Association (AHA) and the Robert Wood Johnson Foundation.

Through population health management, ACOs could target disease prevention and reduce the costs associated with acute care. Healthcare information technology along with medical data analytics are also expected to boost patient outcomes and help accountable care organizations generate shared savings.

“Since population health is a developing science, personnel dedicated to ongoing training will be essential. The closely related and ever-increasing dependence on health information technology at every level will also require another level of training and expertise,” the AHA report stated. “Hospitals are making large investments in advanced electronic health record (EHR) systems and enterprise data warehouse solutions that allow providers to stratify patient data and conduct other population health management analyses.”

The American Medical Group Association (AMGA) released a report outlining how population health management needs to be incorporated in the accountable care setting. Population health management involves handling all patients’ health across the entire spectrum from those with chronic medical conditions to others who are fit and live a healthy lifestyle.

In order to build a strong population health management model, an accountable care organization will need to rely on electronic health records and patient portals as well as create care teams to coordinate medical services across the healthcare spectrum. Before the growth of accountable care organizations across the country, the use of patient portals and care managers was not widespread. One survey from Phytel shows that about 35 percent of polled providers created patient portals and about 70 percent used care managers.


Some of the steps that payers and providers will need to incorporate in their population health programs is to begin “proactively reaching out to every patient” and automating their care management systems, according to the AMGA report.

In order to take on high patient capacities, accountable care organizations will need to delegate clinical processes among primary care physicians, nurses, specialists, and care managers. Physicians will have more time to fill in care gaps if medical assistants are given the opportunity to manage a patient’s history. Receptionists may have more time to manage follow-up appointments and patient referrals if nurses take on triage care-related calls, the report states.

“In order to work effectively as ACOs or within ACOs, all medical practices will have to be reengineered so that physicians become leaders of high-performance care teams, take on new roles, and share responsibility for patient care with other members of the team, seeing only those patients who require physician attention,” the AMGA report outlined. “In particular, primary care practices must find a way to increase their patient capacity without sacrificing quality of care or adding more work to already overburdened physicians. This will entail changes in workflow and work processes to delegate clinical responsibilities properly.”

Additionally, the entire healthcare system - from payers to providers - will need to undergo a cultural shift and focus on a more patient-centered approach. Some potential solutions for a patient-centered ACO include increasing the hours a primary care practice operates, creating a user-friendly patient scheduling and billing system, and allowing patients to request refills online.

In order to reduce overall medical costs, improve the quality of care, and generate shared savings, accountable care organizations will need to invest in population health management, which involves monitoring the health of their entire patient base through a patient-centered approach.


Dig Deeper:

Key Steps for Payer Success in Accountable Care Organizations

What Are the Benefits of Accountable Care Organizations?


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