Fierce Q&A: ACO results are worth the challenges at OSF Healthcare

Amid collaborative efforts as a Medicare Pioneer ACO, Illinois' OSF Healthcare yesterday amicably ended efforts to team up with Rockford Health System. The move followed close scrutiny from the Federal Trade Commission, which filed a complaint last year against OSF's acquisition of Rockford and won in federal court last week when a judge ruled to halt the deal.

According to CEO of OSF Ambulatory Services Bob Sehring (pictured), OSF and the FTC are on different pages when it comes to using collaboration to improve healthcare delivery.

In part 2 of this exclusive interview with FierceHealthcare, Sehring discusses the limitations and challenges to implementing an accountable care model but why he still thinks healthcare collaboration is the way to go, despite FTC opposition.

FierceHealthcare: How did OSF patients and providers respond to the change to accountable care?

Bob Sehring: For the providers--both our own extensive employed physician population, as well as an external population of physicians and other facilities--I think they have reacted well.

It is new, and we will continue working with all of them as we proceed, but I think that has gone well. I'd say the same thing for the beneficiaries. All of the beneficiaries in December and early January received a letter that was designed in conjunction with the Centers for Medicare & Medicaid Services that notified them about the accountable care organization, that they were aligned with OSF because of the significant amount of activity that has already taken place--in other words, they were using either an OSF medical group primary care physician or they were seeing one of our cardiologists at an extensive level and so on.

They had an option to opt-out of sharing data with OSF--and data really is at the crux of being able to identify those care gaps or to ensure that care is well-connected across the continuum. So they have the option to opt-out if they did not want to share that claims data with OSF and out of the 24,000+ beneficiaries. There may have been a couple of hundred that opted out, which was a very small percentage and even smaller than what we thought might happen.

FH: So far, what has been the biggest challenge to implementing the ACO model?

BS: To date, it really is data. And more so than just the data, it is also changing data into actionable information that you can put in front of clinicians to help them with their day-to-day work with their patients. So this is not specific to the just the Pioneer ACO; it is working with payers, looking at claims data, identifying care gaps, identifying opportunities for improvement and working through all of that.

Having an electronic medical record such as EPIC--which we have in all of our facilities and the vast majority of our employed physicians--is great for connectivity across the system. And it does provide you with a wealth of data. I would say we are still working at how to best turn that data into actionable information. So that is one of the top challenges.

Another challenge facing providers or healthcare systems across that country is finding a new clinical model in which to deliver primary care. When we have shortages of primary care physicians and shortages of advnaced practice nurses and physicians assistants, working at a time when the population is aging, when the need for primary care is increasing, we need to work through changes in the clinical care model that better meet the needs of the patients we serve.

Any accountable care organization, including Pioneer ACO, is getting care managers involved early with those beneficiaries who could most benefit from the assistance of a care manager--who help them better understand their chronic diseases, what needs to be done to help them self-manage or help improve their chronic diseases, help them navigate through the healthcare system and be well aware of what other services are available in the community. It many respects, it's connecting those that we serve with those opportunities. It's not just the medical conditions; it's a combination of psychological and social needs as well, and how to we meet all three of those to improve the overall health of those individuals.

FH: How has the Pioneer ACO alignment played into the system's recent interactions with the FTC on mergers?

BS: It really hasn't played into the FTC's thinking--which we frankly find unfortunate because on one side, you have the administration, as well as different organizations within the administration such as CMS, who believe strongly that collaboration amongst clinicians and facilities is really critical to the healthcare delivery systems across the country. And what the Pioneer ACO, as well as other accountable care models, is looking to do is figure out how we improve that collaboration, to increase it, which will have the benefits of improving clinical quality and safety, as well as reducing the cost of delivering care, thereby reducing costs to those that we serve. And so we believe very strongly that that is the way we are going, and we feel the country is heading in that same direction to improve the care and reduce the cost.

Unfortunately, the FTC and the U.S. Justice Department, they don't appear as convinced that is an appropriate avenue to go down. As an example up in Rockford, they are preventing us from merging two facilities that really would benefit (and certainly we believe the citizens of Rockford would benefit) by being able to combine efforts, reduce some of the duplication or excess costs and improve care that's delivered to the population. But unfortunately, the FTC is viewing that more as a negative impact on competition. We view it as critical to produce results of better care and reduced costs (which is just what the FTC is looking for) for the community of Rockford.

So it's suffice it to say, the FTC and we are on clearly different pages. But I would also suggest the FTC and other parts of the administration are on different pages, as well.

FH: What do you anticipate for OSF regarding accountable care or mergers and acquisitions for the year ahead?

BS: On the merger front, we don't have anything in mind. We've certainly seen industry reports that talk about an ongoing effort for mergers and consolidation for hospitals across the country so I do expect to see more of that across the country but not sure I can speak to exactly what will happen here is central Illinois.

As far as accountable care, there's no doubt in our mind as an organization that the move from fee-for-service to pay-for-value is going to continue and accelerate over the coming years. In terms of our work with the Pioneer ACO, other managed care payers, the insurance exchanges that would become effective under the Affordable Care Act, we think accountable care is going to be important for that.

We're looking at efforts at the state level here within Illinois with a Medicaid population, and potential for approaches such as accountable care are being discussed. So again, there's no doubt in our minds that the country will be heading in that direction. We believe that is the right direction, and we're pushing in that same direction.

FH: As the industry moves to accountable care, how do you see the ACO model evolving?

BS: I'd say that ACO, as we all learn more about how best to coordinate care across the continuum, getting all of the pieces to work well together (the primary care physicians, the specialty physicians, hospitals, home care agencies, nursing homes) to really be able to connect all of those pieces together, I think it will be an ongoing learning of how best to communicate, how best to improve handoffs from one piece of the healthcare system to the other. I think one of the things that we find is right now, healthcare systems (or the healthcare system across the country) tend to operate in silos. Handoffs of patients from one of those silos to the other become very complex, and frankly, not very efficient or effective. And so I believe as we continue through this, it is the learnings about how do we best coordinate and communicate and break down the walls of those silos so that the care for the patient is more seamless and the results of that, we believe, will be higher quality and lower cost.

FH: Any words of advice for other hospitals and health systems thinking of building an ACO?

BS: Although we expected it to be a lot of hard work, a lot of time and energy, so far we have seen the results are well worth the investment. But it is a significant investment. I would suggest those who are looking at becoming an accountable care organization or moving in that direction need to have their eyes wide open when they go in because there is a myriad of changes that are critical to positioning yourself to take on the responsibilities for a population, in addition to the individual patients themselves.

On the positive side, the results we've seen, the very early results with our Pioneer ACO and all our other activities with accountable care organizations, have been positive, both from our own clinicians' perspective that have really embraced the approach, and also from the patients perspective, that they recognize and believe that this is a better approach to the care they're receiving. It's those stories from those patients that are heartwarming and reinforce that the path is the right one. Irrespective of how large some of the challenges are, the results are well worth it.

Editor's note: This interview has been edited for length and clarity.

Related Articles:
Fierce Exclusive: OSF HealthCare exec on the Pioneer ACO journey
Atrius CEO Interview: Inside a Pioneer ACO

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