Technology: Aetna's linchpin to ACO success

We already know Aetna has successfully implemented "a fundamentally different strategy in accountable care" by empowering providers. With that approach, providers say Aetna is more forward thinking in regards to sharing and partnership and has established an all-in approach of committing fully to accountable care.

That's why a report from KLAS Research about the accountable care strategies of four large payers labeled Aetna as a "transformational partner" in ACOs.

But what's the cornerstone of Aetna's ACO strategy? In part 2 of this exclusive interview, Charles Kennedy (pictured right), CEO of Aetna's accountable care solutions, says it's technology and a willingness to let providers drive the ACO.

FierceHealthPayer: Providers ranked Aetna as one of the most accommodating payers in the KLAS report, primarily because the insurer really lets providers' visions drive the ACO relationship. Why is Aetna willing to concede that control?

Charles Kennedy: Because we've done just about everything you can do with the old model and it simply isn't working. You look at healthcare costs in the last 20 or 30 years and they've always exceeded the rate of inflation--and that's been despite everything we could do in the old model, including aggressive contracting, disease management and consumer-directed health plans.

In this new model, we really see ways that collaboration can drive value compared with the old confrontation over rates. And we're not just making this up. Look at the big auto makers, years ago they moved away from confrontational relationships with their suppliers where they fought over getting lowest rates to collaborative supply chain relations where they might even bring in some of their suppliers on design products and services. And we know from other industries throughout the economy that that has produced much better results than the old confrontational style. So what we're doing is taking the lessons that have been proven out throughout the American economy and simply bringing them to healthcare.

FHP: What role does technology play in Aetna's ACO program?

Kennedy: Technology is one of the most important components of what we do. We have a company called Healthagen, which is our umbrella company for health informatics. We've found the application of technology to the clinical environment is very complicated and takes quite a bit of time. We learn from our physician partners all the time. For example, one of our customers is an integrated hospital that noticed from our data they were very high in their use of intensive care unit services, which are rather expensive. And that caused them to look at the clinical literature and notice that patients who were intubated are frequently sedated. But there's clinical literature that shows if you don't sedate the patients or don't sedate them as aggressively, they get off the breathing machine more quickly and get out of the ICU more quickly, saving literally millions and millions of dollars. So they created a clinical protocol that put into practice that clinical research at their local facility, and they saved $22 million that year. What we're trying to do is learn from our clinical partners and then share that information across our ever-expanding ACO network so other facilities in other geographies can take advantages of innovations and results like that.

FHP: What are some of the challenges Aetna faces when it comes to providers adopting technology?

Kennedy: Change is hard. In the healthcare industry, physicians are accustomed to doing things the way they've always done them and there's very good reasons for that. So I don't want to underestimate the challenge. It's no small task to help delivery systems through technology and care management programs change what they do and how they do it for better economic and quality outcomes. So it is a significant challenge, but we learn things from delivery systems all the time.

Some of the challenges we see are some providers are hesitant to go down the technology path, and some providers will flip back into the old way of things--in other words, won't think of this us as a partner and will think they have all this control now and try to leverage it to increase rates. So the strategy is not without risk; that said, the vast majority of our customers have embraced the strategy and have tried to their levelheaded best to keep the prices low and the quality high.

FHP: How do you respond to providers who are resistant to technology?

Kennedy: There's a variety of things we do to try to minimize any impact to the provider community. One is we frequently supplement their clinical staff with our own staff so there's less work for the provider to do. For example, we noticed Medicare members were receiving uncoordinated, duplicative and unnecessary care that was sometimes harmful. Instead of trying to get the physicians to use technology or modify their practices, we gave them an additional staff member we actually pay for. We provide them that staff in their office to do all the care coordination functions, work with the patients to ensure they're taking their medications correctly and do all the things that we know make a difference. When we do that, we see enough savings to both pay for the staff member as well as share some incremental upside value with the physicians.

Usually most physicians, when they see the technology is actually something that's helping them and their patients and also is a financial win come around to the idea.

Editor's Note: This interview has been edited and condensed for clarity. Check out part one of this interview, in which Kennedy explains Aetna's overall ACO strategy.

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