Fierce Exclusive: OSF HealthCare exec on the Pioneer ACO journey

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While healthcare organizations continue to weigh the pros and cons of Shared Savings programs, the Centers for Medicare & Medicaid Services already has named OSF HealthCare System in Illinois as one of the first Medicare ACO Pioneers. With a wide range of hospitals, a substantial medical group, home care agencies and nursing homes, OSF already had the broad continuum of care necessary to function in the coordinated care initiative.

In part 1 of this exclusive interview with FierceHealthcare, Bob Sehring (pictured), CEO of OSF Ambulatory Services, shares the system's experiences with accountable care and why the integrated system signed up to participate.

FierceHealthcare: What prompted OSF HealthCare System to participate as a Medicare Pioneer Accountable Care Organization?

Bob Sehring: It started well before they even announced the Pioneer ACO or the Shared Savings ACO, which was part of the Affordable Care Act. We certainly recognized that reimbursements and activities with all payers were moving from paying for the service you provide to a payment for value. As a large integrated system, we recognized the benefits of that and wanted to participate in that.

A lot of the activities necessary for the Pioneer ACO started three or four years ago with our physician enterprise and a focus on patient-centered medical home--which we have in place at 10 of our physician sites. With that, we started to work with payers several years ago on modified reimbursement in all of our major contracts. We have expanded that to include a shared risk arrangement with a major payer--so we participate in both upside and downside risk. OSF also had owned an HMO, so there was a lot of institutional expertise in managed care and working with populations, and we relied on all of that.

FH: What other organizations are involved in the Pioneer ACO model and how are they aligned?

BS: We may be structured a bit differently than some of the other organizations that are Pioneer ACOs because I know some of them are a combination of independent organizations that came together as a Pioneer ACO. For OSF Healthcare System, because of our depth and breadth, we chose to apply as a Pioneer ACO with OSF-owned facilities and OSF-employed physicians. We have not linked together or brought other organizations into the Pioneer ACO.

But it's not that we don't work with other organizations on behalf of those beneficiaries that have been aligned to us. We actually have long-established relationships with specialty groups, skilled nursing facilities and nursing homes and other healthcare agencies in all of our markets that are not employed by OSF.

While it's the owned facilities and employed physicians that are contracted with CMS for the Pioneer ACO, we rely on all of the physicians and other organizations throughout central Illinois to work closely together to help the population.

FH: Has OSF seen any savings or improved outcomes from its Pioneer ACO alignment?

BS: It's a relatively new program that started Jan. 1 and so while we have seen some positive anecdotal results from working more closely with some of the beneficiaries and care management, I would have to look at some of the other arrangements we've had in place for a longer period of time--for instance, our pay-for-performance programs with major payers, including Blue Cross and Humana, in which we have seen improvements, such as in targeted care gaps. Our patients (their members) were not receiving the full breadth of care that was important to them based on whatever chronic diseases they had. And so working closely with each of the payers on those populations has been focused on closing those care gaps, and we've seen that already.

We've seen other activities in our employee benefits program, which for a number of years has, both in terms of quality and safety metrics and financial performance, been performing much better, meaning it's growing at a slower rate than most employers in Illinois and throughout the country.

So we look at those as some very positive results from the activities--those same set of activities really are critical for the Pioneer ACO--and we certainly expect good results from that, but it's just too early to tell.

Editor's note: This interview has been edited for length and clarity. Look for part 2 of the interview with Sehring next week.

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