5 ACO implementation lessons from healthcare leaders

Accountable care organizations exist in many forms, from the Pioneer ACOs and the recently announced Next Generation ACO to smaller, less formal arrangements between payers and health systems.

Every partnership comes with its own stated objectives, but there's also an underlying and often implicit goal: Avoid the failures of capitation.

A panel discussion at this week's World Health Care Congress in the District of Columbia focused on the lessons that three healthcare executives learned as their organizations implemented an ACO. Below are their five pieces of advice:

Think small. CareFirst BlueCross BlueShield, which has 3.3 million members in the District of Columbia area, started with small groups of primary care physicians at independent facilities. These physicians, and the care teams they formed, have the most to lose as the industry increasingly shifts the burden of paying for healthcare services from plan sponsors to patients, said Chet Burrell, president and CEO. That's because those providers get hit harder than large academic medical centers and integrated delivery networks when patients cannot afford a test, prescription or other service.

Think big, too. That said, accountable care cannot succeed without scale. Joseph Gifford, M.D., CEO of Providence-Swedish Health Alliance, attributed the organization's success to partnerships with Washington state's largest employers. Boeing, for example, has enrolled 30,000 employees into one of two direct-to-provider ACOs. Large employees make good allies because they want to cut healthcare costs and they know how to demand what they want, Gifford said. Memorial Hermann ACO, a Houston-based network of 4,500 physicians, learned a similar lesson when the price of oil dropped and the large companies it worked with started to show an interest in narrow networks and other cost efficiency measures, according to Chris Lloyd, CEO of the ACO and Memorial Hermann Physician Network.

Remember the goal. Much of healthcare today emphasizes an improved customer experience--and much of that effort focuses on how to make it easier for patients to shop. Yes, millennials alter the healthcare landscape, but the ACO model and payment reform must focus on the 20 percent of patients who consume 80 percent of the industry's resources and, for a variety of reasons, do not or cannot shop for services, Burrell said.

Monitor data. To that end, data from claims--to the tune of 37 million per year for CareFirst--shows which of those frequent-flier patients received services when, from whom and for how much. This provides a "very complete" profile of services, which care teams can use to make future decisions about care delivery, Burrell said. Gifford recommended a "small ball" approach: Decide what you need, then get someone to crank out the analytics.

Just do it. The industry will not shift back to a fee-for-service model, Gifford said. The Next Generation ACO model and the changes to the value-based payment model announced by the Centers for Medicare & Medicaid Services show that CMS takes payment reform seriously. "Starting a step forward is a win, even if you're not making money," Gifford said.

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