Unlike failed PHO initiatives, ACOs focus on clinical outcomes, not utilization

Dr. Bruce FlareauUntil CMS issues a proposed rule that defines them more clearly, accountable care organizations are destined to remain amorphous and blurry at best. Just what are they? And what are their primary goals? One of the first few books that's attempted to answer those loaded questions is Accountable Care Organizations: A Roadmap for Success (Convurgent Publishing, 2011). FierceHealthcare recently checked in with lead author, Dr. Bruce Flareau, FAAFP, FACPE, CPE, (pictured) who is chief medical informatics officer and vice president of physician alignment for BayCare Health System in Clearwater, Fla., to see if he could shed some light on common myths about ACOs.

FH: What do you see as the most common misconceptions about accountable care organizations?

Flareau: Common misconceptions include:
1.      Physician employment is the preferred and/or only way to create an ACO.
2.      Creating an ACO is about reimbursement rates.
3.      Physicians will have to be on a single EMR to make this work.
4.      This is just like the PHO initiatives that failed in the past.

One other area of interest might be the notion that
5.       Healthcare reform will be repealed so this will all go away.

FH: And how would you debunk those myths?

Flareau: I would educate interested parties to the facts as we know them.

[Myth: Physician employment is the preferred and/or only way to create an ACO] First, on the matter of employment, to be an ACO does not in and of itself require physician employment. However, for independent physicians to participate in a collective bargaining or a joint contracting program is to invoke legal constraints around antitrust issues.

Fortunately case law and published "indicia of clinical integration" serve as road maps for creating a Clinically Integrated Network or CIN that both allows independent physicians the legal ability to act as one while simultaneously holding those physicians to a high standard of clinical integration for the purposes of delivering better care at lower costs. Independent physicians will either need to work within these legally appropriate clinically integrated networks or they will need to be employees.

[Myth: Creating ACOs is about reimbursement rates] From a total cost of care perspective, most believe that a population health management approach will curb healthcare expenditures and will do so by improving preventive health measures, chronic disease management and lower cost alternatives than acute care or rescue care management.

That said however, the primary purpose of an ACO must be to improve the health of the population it serves and to deliver improved value to those patients and consumers. An ACO should not only be about the money, but rather the quality and value to the consumer as well.

[Physicians will have to be on a single EMR to make this work] On the matter of technology, again the answer to a single EMR platform is largely no. While having a group of physicians and hospitals on a common technology platform is ideal, the reality is that this is difficult to accomplish, particularly in a short time period. Fortunately, interoperability standards will make the connecting of disparate systems easier with time. In the meantime, registry systems, HIE vendors and compression of the office EMR market all contribute to creating ACOs.

[This is just like the PHO initiatives that failed in the past.] One of the key differences today compared to the PHO initiatives of yesteryear is that PHOs were driven by the insurance industry. As such they placed physicians in the unpopular position of gatekeeper instead of patient advocate. It focused on utilization and not on clinical outcomes. ACOs, however, should be physician-led and should in fact be based upon clinical outcomes. Change is likely, because we have better systems today from which to measure and share those outcomes. Consumer expectations are higher, reporting is increasingly transparent, and the percentage of GDP on healthcare are all compelling arguments for why it is different today than it was then.

FH: Does this mean ACOs won't lead to rationing, as some doomsayers have predicted? 

Flareau: ACOs should lead to improved accountability but providers cannot do that alone. Patients have to play a role in their own healthcare. Similarly, if we are less concerned about interim measures such as utilization, and more concerned about clinical outcomes, we may actually increase access to care. A more expensive definitive test might, in fact be the more cost appropriate way to care for a certain condition to get the desired clinical outcome.

FH: What parts of creating an ACO will pose the steepest learning curve?

Flareau: For many, developing the business intelligence and reporting capabilities to manage clinical risk will pose the largest challenge.

FH: Why is that? 

Flareau: Business/clinical intelligence is a way of pulling data and converting it into understandable knowledge that can help the patient care team deliver better care. Managing populations of patients means the care team will assume oversight clinical management responsibilities for the care management of groups of patients--so called clinical risk management.

Hence asthmatics of a certain severity should have a number of interventions to manage their chronic disease state. If well managed their outcomes might be favorable, while if poorly managed, their clinical outcomes may not.  In addition to bringing physicians along in the process, having the necessary infrastructure to help the clinicians manage cohorts of patients will require a significant capital investment.

FH: If healthcare reform were somehow repealed or defunded bit by bit, would ACOs go away?

Flareau: My simple answer would be "isn't it the right thing to do anyway?" Also, look how much change occurred in the 80s under threat of legislation when in essence no reform occurred at that time.

This interview was edited and condensed.

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