The Droids You Are Looking For Are Not Here

by Gregg A. Masters, MPH

Beneath the ideological crossfire and mostly bluster of the ACA ‘repeal and replace crowd’, while the latest ‘new, new, thing‘ aka the defacto Rorschach upside of a litany of mostly vaporware or me too ‘meh‘ digital health apps, platforms or S-1 filings (see: ‘Disruptive Idiots from Silicon Valley‘) stumble into maturity amidst growing calls for validation and evidence of tangible ecosystem sustainability, a pulse of innovation can be found in some less ‘sexy’ sectors.

Some time ago physician innovation pioneer Richard Merkin, MD, the founder and principal visionary behind the Heritage Provider Network and all of its sequelae (Heritage Medical Systems, Heritage ACO, etc.), opined from the stage at the ACO Summit that perhaps the biggest contribution (gold) from the ACA was to be mined from the forward leaning work stimulated by the law’s enablement of the Centers for Medicare and Medicaid Innovation (CMMI) aka @CMSinnovates on twitter.

Richard Gilfillan MDThe indisputable driver of what was then invested in Richard Gillfilan, MD the first CMMI Director (now stewarding the transformation at Trinity Health System, @TrinityHealthMI), was the volume to value imperative.

Into this challenge was cast considerable public capital/incentive funds to model what that meant from a delivery system and financing re-engineering perspective. Perhaps fueling the discounting of CMMI’s early efforts was the poorly constructed ‘Pioneer ACO‘ program, ostensibly designed to attract a more risk savvy pool of players who could reasonably assume greater risk and therefore earn more meaningful bonuses for doing what they already know how to do principally via Medicare Advantage participation. This early cohort of 32 ‘Pioneers’ has dwindled recently to 19 with the recent defection of the trophy Darmouth-Hitchcock ACO, see:Dartmouth-Hitchcock exits Medicare’s Pioneer ACO program‘.

With that as backdrop, consider the following timely guide from the Cooperative of American Physicians titled ‘The Physician’s Guide To Value-Based Compensation‘. Consider this an essential ‘blocking and tackling’ primer of how to incentivize the granular behavior of those who write the ‘purchase orders’ for an essentially supply driven healthcare economy. As my colleague and surfing buddy John Mattison, MD (@JohneMattison), Assistant Medical Director, and CMIO Kaiser Permanente Southern California (@KPshare) often says: ‘we get what we incent’.

CAP_guide to value based comp

[Editor’s Note: and for those of you really interested in where the AMA stands on the bridging the volume-to-value divide, listen to: Health 2.0 Fall Conference 2015: An AMA Deep Dive on ‘The App Cure’].

Whether the ACA is repealed (highly doubtful) or materially modified (also not likely) its essence will not and cannot be ‘undone’ – the horse is out of the barn. Like it or not, the controlling DNA driving the many moving parts articulated in the ACA (and its state lab version ‘RomneyCare’) builds on decades of established health policy thinking on what works in the uniquely American public/private pluralistic partnership of healthcare financing and delivery.

Watch the ‘enablers’

Whether ACOs, fully integrated delivery systems (real IDNs – NOT their IDN lite versions), PCMHs, or one of a number of strains of risk bearing organizations (RBOs) from bundled pricing to full blown per member per month (PMPM) capitation, this is where the sustainable action can and will be found. This other stuff, plays well at CES and the many wannabe healthcare industry copy cat conferences playing an up the ante ‘cool factor’ card to an often ADD crowd, yet it’s tangible contribution to the triple aim or sustainable healthcare economy remains squarely ‘on the come.



Courtesy of our friends at AJMC: ‘5 Things to Know About Accountable Care Organizations’

by Laura Joszt

This week, The American Journal of Managed Care was in Palm Harbor, Florida, hosting the fall live meeting of its ACO and Emerging Healthcare Delivery Coalition, where stakeholders from across the healthcare industry discussed best practices. As the country moves from volume to value, accountable care organizations (ACOs) can play a key role during the transition from fee-for-service. However, ACOs not only remain largely a mystery to the average consumer, but also to providers who may be part of an organization participating in an ACO. Here’s what you need to know about ACOs:

1. ACOs are older than the Affordable Care Act. At least, the theory of ACOs is older. While the inclusion of ACOs in the health reform law has accelerated adoption of the delivery model, the term “accountable care organization” was first coined in 2006 by Elliott Fisher, MD, director of the Dartmouth Institute for Health Policy and Clinical Practice.

2. There are multiple models established by CMS. There are a number of different ACO models being offered by CMS. The most common model is the Medicare Shared Savings Program (MSSP), which has 404 ACOs and is accepting more. The Pioneer ACO Model is for healthcare organizations and providers already experienced in coordinating care, and while it started with 32 ACOs, just 19 remain today. The Advance Payment ACO Model is designed for physician-based and rural providers. And the newest model is the Next Generation ACO, which takes on greater performance risk with potentially greater rewards. The Next Generation ACO model is….

Complete article by Laura Joszt posted here.

FLAACO? What’s That?’

by Gregg A. Masters, MPH

First there was section 30222 prescribed by the Patient Protection and Affordable Care Act (“ACA”), which added section 1899 to the Social Security Act that requires the Secretary of Health and Human Services to establish the [Medicare] Shared Savings Program (MSSP), see: ‘Summary of Final Rule Provisions for Accountable CareOrganizations under the Medicare Shared Savings Program‘.

Leading up to and continuing to this day is a literal potpourri of aligned industry stakeholders and interests who support this emerging ‘new, new thing‘. From the ACO Congress to the ACO Summit and a host of others including the National Association of Accountable Care Organizations (NAACOs) and most recently the ACO Coalition forged by principals at The American Journal of Managed Care (who launched a sister publication the American Journal of Accountable Care) they advocate for and provide both networking opportunities and continuing education into best practices for these nascent entities on which much of the success of the ACA is vested.

ACOs, a once ‘DOA’ (dead on arrival) too little too late or ‘HMO-lite’ model version, seems to be working it’s way into not only the lexicon of managed competition via a growing body of endorsements and reported outcomes data by many both in the public (CMS) and private (Aetna, United, Blues plans, etc) sectors as the preferred mechanism to implement the vision of the triple aim and fuel the transition from volume to value based medicine.

Like much of its era-specific innovation industry predecessors HMOs, PPOs, EPOs, OWAs), i.e., greasing the skids for if not enabling the HMO industry migration beyond the limited appeal of staff models to mainstream medicine penetration via Independent Practice Associations (IPAs), and later followed by the growth and penetration of PHOs (physician hospital organizations), ACO ‘enablers’ (as well as this value based platform) seem to be here to stay.

Enter the Florida Association of Accountable Care Organizations (“FLACCOs”) led by former health plan executive Nicole Bradberry (for context listen to interviews with Nicole here and here), which holds its annual conference in Orlando, Florida October 1 & 2nd 2015.

FLAACOs Orlando Conference

The agenda is packed with entrepreneurs and operators in the space from ACO enablement companies including Aledade, to ACOs and vendors who support their risk readiness assessments if not assumption such as RowdMap. Aledade founder and CEO Farzad Mostashari, MD will keynote (see: ‘Former ONC Director Farzad Mostashari, MD Launches @AledadeACO).PopHealthWeek-logo-TWTTR-sq (2)

For the FLAACO agenda, click here and the list of participating faculty click here.

This year my colleague and co-founder of PopHealth Week (formerly, This Week in Accountable Care) Fred Goldstein and I will broadcast live from the event.

If you are not following FLAACOs and are interested in the road to accountable care, you may want to take note and perhaps even consider attending this gathering.

Health Insurance Industry Consolidation: Any ‘Qui Tam’ Exposure?

by Gregg A. Masters, MPH

If you’re a health policy junkie like me, then the best show in town (or anywhere for that matter) was in the Dirksen Senate Office Building in Washington, D.C., where HMO industry veteran and Chairman, President and CEO of Aetna Mark T. Bertolini and Anthem President and CEO Joseph R. Swedish among other industry stakeholders testified before the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights on health insurance industry consolidation, for video replay click here or watch below:senate hearing health insurance industry

As most of you reading this blog know, subject to the Department of Justice review Aetna will acquire Humana, and Anthem will acquire CIGNA. Thus, the submitted testimonies and ad hoc answers to sitting Senators on the Subcommittee were potentially a high stakes exchange.

Moreover, the hearing today was nothing short of a tutorial into the dynamics of the managed competition marketplace (both theory and practice since absent complete transparency assuming the salutary benefits of such competition may be more ‘wishful thinking‘ than reality as noted by Senator Blumenthal – CT, the home of the insurance industry) and whether this unique American strain of public/private collaboration can deliver on the oft repeated promises of such integration, i.e., that scale via consolidation drives operating efficiencies, improves quality and lowers costs to end users. We shall see…

As I heard the pitches from the various representatives assembled to offer perspective to the sitting Senators (see list here), I began to wonder if any of their testimony would be subject to the ‘false claims Act‘ if post consolidation the promised benefits do not accrue to the intended benefactors.

For those of you not familiar with the ‘False Claims Act‘ or otherwise known as Qui Tam filings, here a summary including its recent expanded scope via the Affordable Care Act:

The False Claims Act, expanded by the Fraud Enforcement and Recovery Act of 2009, P.L. 111-21 (S. 386), 123 Stat. 1617 (2009), now proscribes: (1) presenting a false claim; (2) making or using a false record or statement material to a false claim; (3) possessing property or money of the U.S. and delivering less than all of it; (4) delivering a certified receipt with intent to defraud the U.S.; (5) buying public property from a federal officer or employee, who may not lawfully sell it; (6) using a false record or statement material to an obligation to pay or transmit money or property to the U.S., or concealing or improperly avoiding or decreasing an obligation to pay or transmit money or property to the U.S.; (7) conspiring to commit any such offense. Additional liability may also flow from any retaliatory action taken against whistleblowers under the False Claims Act. Offenders may be sued for triple damages, costs, expenses, and attorneys fees in a civil action brought either by the United States or by a relator (whistleblower or other private party) in the name of the United States.
If the government initiates the suit, others may not join. If the government has not brought suit, a relator may do so, but must give the government notice and afford it 60 days to decide whether to take over the litigation. If the government declines to intervene, a prevailing relator’s share of any recovery is capped at 30%; if the government intervenes, the caps are lower and depend upon the circumstances. Relators in patent and Indian protection qui tam cases are entitled to half of the recovery.

Not sure if qui tam consideration can or even remotely applies to the upside representations proffered in favor of the acquisitions, since as noted by one or more witnesses today much of the empirical (public) record is incomplete and inconsistent with respect to supporting or discounting the arguments that will or have been made to DOJ as they conduct their anti-trust investigation into the proposed acquisitions or mergers.

[Editor’s Note: Two examples of previous health insurance industry consolidations were noted, including Aetna’s 1999 acquisition of PruCare, and United Health Group’s acquisition of Sierra Health Services. I will post the submitted witness testimony once it becomes available online, including any current discussion ‘tea leaves’ of what and where the DOJ investigation may be headed in both transactions. If you have anything, please feel free to add in comments section.]

This Subcommittee hearing is rich with both fundamentals and nuance considerations of the Affordable Care Act and whether it’s many moving parts can indeed align to meet the legislative intent of its authors.

Stay tuned!

Another Milestone Marker in Favor of the ACO Model?

by Gregg A. Masters, MPH

I awoke this morning to an email from a PR rep who supports outbound news for one of the emerging ACO management companies enabling physician led participation in the Medicare Shared Savings Program (MSSP) aka Aledade (@AledadeACO).

I then copy, pasted and tweeted the headline: ‘Aledade Creating New Medicare Accountable Care Organizations in Seven States.

I usually ignore ‘PRs’, yet this announcAledade newsement is material as it lends support via a growing body of evidence on the viability of the ACO model and its enabling ‘consciousness’ if not ‘sentiment shift’ in the prevailing market narrative.

While some still slam the ACA – and by proxy it’s ACO ‘workhorse’ – via relentless yet ‘diminishing returnsimpact of the ‘government takeover‘ fear mongering fueled by strategically sourced oppositional research, there is a building steady body of evidence supporting both the model and the broader context of efficacy of the competitive dynamics the ACA has unleashed on the stewards of our at risk (some say collapsing) healthcare economy.

Ergo my tweet:

Aledade news tweet

Ever since the Senate Finance Committee took up the debate and relentless series of ‘amendments‘ proffered by the ‘Rs’ trying to ‘improve‘ the proposed legislation that eventually emerged as the Patient Protection and Affordable Care Act (I NEVER use the pejorative term ‘Obamacare’), I’ve been a voice in the narrative of trying to get the facts of competitive market dynamics into the post political conversation around reforming our complex healthcare economy.

This is no easy task as the complexity of both the political process and objective reporting of how legislation becomes law including its contextual historical narrative is addressed in ‘A Legislative History of the Affordable Care Act: How Legislative Procedure Shapes Legislative History.

A challenge recognized upfront via admittedly ‘apolitical’ or ideologically agnostic ‘law librarians’ (yeah, you know those agenda driven bullies):

“Using the health care legislation passed in 2010 as a model to show how legislative procedure shapes legislative history, this article posits that legislative procedure has changed, making the traditional model of the legislative process used by law librarians and other researchers insufficient to capture the history of modern legislation. To prove this point, it follows the process through which the health care legislation was created and describes the information resources generated. The article concludes by listing resources that will give law librarians and other researchers a grounding in modern legislative procedure and help them navigate the difficulties presented by modern lawmaking.”

Since social media was starting to pick up in 2009 – 2010 time-frame, and given the angst associated with the public’s consumption of the ACA, I started ACO Watch and latter the hashtag #healthreform to track tweets associated with ACA consideration.

None-the-less, 5 years later the disinformation campaign persists though some of the pieces of the ACA are starting to show some promise of the law’s original intent. ACOs often referred to as a flawed model, perhaps an ACO lite if you will or too little too late to make a difference, the emerging datasets (both government and private market tea leaves) are building a case that the law is working.

Tomorrow on PopHealth Week, join my colleague, co-host and co-founder Fred Goldstein as we chat with Aledade Founder and CEO Farzard Mostashari, MD. This month we’re conducting a series on Population Health and ACOs talking to leadership from each ACO type: physician led, hospital sponsored and health plan enabled.

Listen here! We’re live 12 Noon Pacific/3 PM Eastern, and on demand thereafter.

The @Aetna and @Humana Marriage: Will It Be Different This Time?

by Gregg A. Masters, MPH

Wow! Ahead of the 4th of July weekend Mark T. Bertolini (@mtbert) and Bruce D. Broussard (@BruceDBroussard) both savvy and seasoned managed health care industry players and visionary captains at @Aetna and @Humana respectively, announced their marriage via a $35 billion, see Bloomberg story: ‘Aetna-Humana Deal to Lower Consumer Costs, CEOs Say deal. aetna humanaYet the initial market reaction to this presumptive value added union has been somewhat of a Vulcan mind mood disappointment.

When the Bloomberg reporter Betty Liu inquired about the initial (and continuing as of the date of the post) bearish investor response to the transaction, Bertolini posited:

‘I don’t think its all investors Betty, I actually think it’s the ‘Arbs’ (arbitrageurs) that got in the deal looking for opportunity and I’m not quite sure they know how to do this trade.  This is a longer term strategy. This is a very big combination that is going to have a longer term impact on the quality of healthcare, the cost of healthcare in an evolving consumer marketplace [emphasis mine, more later].. once the noise settles down we’re going to do just fine.’

Then the billion, perhaps trillion dollar question was lobbed to Broussard via Liu:

‘Ok Bruce so is it going to lower healthcare costs for consumers?’ 

To wit the Humana chief noted:

‘very much so, I think as you see the transition from a more employer based to a consumer based model and a value based reimbursement model from a fee-for-service model, these combined organizations will have the capability to meet both of those trends. Both in the way of our clinical capabilities on the Humana side and the deep, deep employer relationships that Aetna has on their side.’

Now lets step back a minute and first breathe in this fact: no-where in evidence has the aggregate cost of healthcare, nor health insurance premiums as proxy, declined (except for a brief period in the 90s when the medical care cost (MCC) index actually fell temporarily into negative territory), then as risk was pushed back by providers to the health plans, resumed their inexorable movement UP. So on a trend basis, health care costs ALWAYS rise as a multiple of CPI. Only recently has that rate of growth fallen from high single or the double digit rate of increases witnessed historically to low single digits – perhaps due more to the economic meltdown (declining demand and higher deductibles/copays) than any proactive contribution via improved health plan clinical risk management, direct or delegated.

Yet in offering documents filed with the SEC and investors as to the rationale for the combined company merger that ‘benefit’ is always posited as an outcome of the transaction. We always hear about ‘scale’, ‘operating efficiencies’ and even better management as a byproduct of the combination.

Secondly, some ‘de-coding’ is in order here. Both Bertolini and Broussard two men I admire as exemplary disruptor’s of ‘legacy healthcare’ inertia, i.e., Bertolini grew up in the HMO industry back in the day when even though his experience was forged in the for profit side of the business, it was none-the-less a mission oriented member focused sector (more MHAs, MPAs, and MPHs than MBAs) much like the community based operators in the non profit sector (RIP).

Broussard on the other hand is not your typical health plan executive as his roots are forged on the provider side with senior roles as U.S. Oncology (the successor to Physician Reliance Corp and ‘TOPA’ Texas Oncology, P.A.), Sun Health (the hospital group) and Continental Medical Systems (a rehab company). So his zeitgeist is firmly rooted in the provider culture with which his company buys, contracts for or joint ventures with to bring products to market.

Now back to the ‘code phrases’ used as rationale outlined for the inked merger/acquisition. Bertolini referred to ‘an evolving consumer marketplace‘ which means as more costs are shifted from the plan (Aetna, Humana and all other health plans writ large) to the member or insured, we (the consumers) will demand more ‘accountability’ from the provider world and thus somehow restrain aggregate healthcare costs via transparency tools or so called ‘skin in the game’ as a result of the shift to ‘consumer directed’ (i.e., high deductible) health plans.

This strikes me as a somewhat disingenuous argument bordering on perhaps naiveté (though it is highly unlikely that this characterization can stick to either of them). But ask yourself, if Aetna, Humana, United, Anthem or the member licensees of the Blue Cross and Blue Shield Association as aggregate wholesale buyers of hospital and physician services, leveraging millions of members or ‘covered lives’ (insurance speak), backed by seasoned provider contracting staffs can’t restrain the cost of healthcare, how can an ‘app empowered’, health literate enabled retail ‘shopper’ (you and me) for health services do better? I don’t think so… There is just too much of a power differential to overcome not to mention eco-system complexity to navigate ‘digital empowerment’ promises notwithstanding. Whether, ’empowered or not’, we are generally ‘screwed’ with more or less support from our ‘friends’ at the health plan if we’re lucky enough to be insured.

The second but related theme was outlined by Broussard:

‘as you see the transition from a more employer based to a consumer based model and a value based reimbursement model from a fee-for-service model’

The two strands here are movement from the employer sponsored model which retains some vestiges of ‘defined benefits‘ at least for union negotiated plans, to a ‘consumer based model‘ more akin to the ‘defined contribution‘ practice of limiting the plan’s liabilities by capping what it pays for on behalf of its members or insureds. The kicker and perhaps ‘game changer‘ here is the near unanimous recognition in the health wonk, including health plan world that fee for services medicine is a burning platform on a dying paradigm – yet, arguably 80-90% of the money in the healthcare eco-system today remains in a predominant FFS book of business – HHS Secretary Burwell’s value based healthcare announcement notwithstanding) so don’t hold yer breath.

So there you have it. Will it, can it be different this time? Can two demonstrated champions of patient centric healthcare in an industry valued slightly higher than tobacco companies get it done when ALL of their predecessors have tried and failed? The carnage is plain to see, but only if you have an event horizon beyond the 24/7/365 current headline news cycle. I don’t know, but maybe the market knows and may even be paying attention to what came before?

For those who want some academic consideration of the broader strategic question, industry history,  if not possible glide-path in the consolidation orgy we are currently witnessing (both provider and health plan/payor/benefits solutions providers) with an exquisite dissection and analysis of the rise, fall and rise again (post Aetna/U.S. Healthcare acquisition), check out: ‘From Managed Care To Consumer Health Insurance: The Fall And Rise Of Aetna‘ by James Robinson, PhD, MPH the Leonard D. Schaeffer Professor of Health Economics and Director, Berkeley Center for Health Technology at my alma mater U.C. Berkeley.

The ACA, ACOs and Health System Reform 5 Years Later

By Gregg A. Masters, MPH

In the relentless sound byte and laughable misrepresentation of facts proffered by ideologues intent upon diluting if not repealing the ACA, one consistent voice of reason and evidence mindfulness is that presented by the cogent and thoughtful reflections on the indicia of ACA implementation courtesy of ‘team Commonwealth Fund’ aka @CommonWealthFnd.aca_5 years out

Published recently in the New England Journal of Medicine by the Commonwealth Fund‘s CEO and former National Coordinator for HealthIT David Blumenthal, MD (@DavidBluementhal) is one to consume, one provision at a time.

The full NEJM article is posted here.

The relevant discussion to readers of this blog specific to ACOs is pasted below:

Accountable Care Organizations

The ACA encourages health care providers to form new organizational arrangements called accountable care organizations (ACOs) that are intended to promote integration and coordination of ambulatory, inpatient, and post–acute care services and to take responsibility for the cost and quality of care for a defined population of Medicare beneficiaries. Under the Medicare Shared Savings Program (MSSP) of the ACA, providers who create such organizations and who also maintain or improve the quality of care can share part of any savings they achieve.
Providers can also elect to become so-called Pioneer ACOs, which not only share savings but also accept substantial risk if expenses for Medicare patients are greater than expected. Recently, CMS announced still other variations on the ACO theme, including arrangements in which ACOs function very much like Medicare Advantage plans.17 Indeed, many observers see ACOs as a bridge from fragmented fee-for-service care to integrated, coordinated delivery systems that resemble the tightly organized Medicare Advantage plans.
The two existing varieties of ACOs have spread with considerable speed. The MSSP has 405 participating ACOs serving 7.2 million Medicare beneficiaries (14% of the Medicare population).18 Quality measures have generally improved for the 33 indicators tracked by MSSP, and patients report better care experiences in some respects than Medicare beneficiaries who are not part of ACOs.19 CMS estimates the savings at approximately $700 million, as compared with control populations not enrolled in MSSP. A total of 32 organizations started in the Pioneer program; 11 transitioned to the MSSP track, and 2 withdrew entirely. The secretary of health and human services reports that the Pioneer program saved $385 million in the first 2 years, as compared with fee-for-service Medicare beneficiaries.20 These cost and quality results are early and modest, and further evaluation is needed before definitive judgments can be made.

A most useful and interesting Appendix re-capping and categorizing the many moving parts of the ACA enabling payment and health system delivery reform is available here.

Big h/t to Blumenthal et al for this fact based and honest reflection of measuring the impact of the ACA five years out.