World Congress Leadership Summit on ACO’s: A Recap

By Gary Baldwin, Health Data Management Blogs

I spent two days last week at the World Congress Leadership Summit on Accountable Care Organizations and my mind is just now recovering. As far as speaker quality goes, this conference (which offered concurrent tracks on ICD-10 and Meaningful Use) was top-notch, with dozens of speakers from hospitals, medical groups, payers, and consulting firms. There was a lot to absorb, but a few recurring themes came through. Here are my Top 10 takeaways from the conference:

1. The End of Fee-for-Service Medicine is Near

Although it has not commanded the media attention of the previously reported end of the world, the demise of productivity-based reimbursement models is imminent, with profound implications for physicians and anyone else working in the industry. Just how imminent? Well, no one offered a specific doomsday date and time, but consider this: According to Paul Markovich, executive vice president of Blue Shield California, the annual premium for one of its HMO policies will rise to $39,000 annually by 2020 if medical inflation continues at the current pace. “The status quo is going to kill us,” he said. And that message was repeated by multiple other participants, providers among them.

2. Current Economics are Unsustainable

You may not like the current iteration of the ACO model (a highly criticized set of proposed rules to be sure), but in one form or another, the industry needs to move to so-called “value-based” purchasing, and do it quickly. “We spend more than we need to and we don’t get good results,” noted Scott Sarren, chief medical officer of Blue Cross Blue Shield of Illinois. “If we fail to reduce costs, our only option left is price controls.”

3. Narrow Timeframe Threatens Federal Program

The health reform law mandates that an ACO program must be in place by January 1. HHS is now digesting comments from a disgruntled industry. The consensus at the conference was that the current ACO proposal is so unwieldy—and risky—that there will be few takers, unless the rules of the game are eased considerably. No one said it, but the federal ACO party may prove to be a giant dud, simply because not very many show up. And make no mistake, this is a program that will need widespread participation to make a dent in the expanding Medicare outlays. Gene Lindsey, CEO of Atrius Health, a Boston consortium of five independent group practices, said his organization is taking a wait and see attitude before jumping in.

There will be some takers for the federal plan, however. James Satterfield, a trustee of the Queens County Medical Society, described the organization’s early efforts to participate—primarily due to a sense of urgency among primary care physicians facing growing expenses and dwindling reimbursements.  “The illusion of being autonomous is gone,” he noted.

4. The Private Sector Will Move on its Own Accord

Faced with the prospects of coping with a tangled federal ACO plan, many in the industry are forging ahead on their own, creating ACO-like arrangements—at the not so tiny risk of running afoul of anti-trust laws. In that sense, Obama’s health reform law—which put teeth (and money) into the federal ACO effort—may already be working. Blue Shield of California has launched three risk-sharing ventures with providers. “This is the private sector’s last chance to demonstrate affordability,” Markovich said. And the Illinois Blues plan has launched an ACO in Chicago with Advocate Health Care, a large hospital system.

5. The EHR is a Foregone Conclusion

Participating in an ACO of any stripe is all but impossible without an EHR. That message underscored multiple presentations. And while the idea is not shocking, the fact that so many speakers now take for granted the technology that has been resisted for so long is telling. Furthermore, the EHR can work, and work well, even in the complex environment of a large, multi-specialty group practice. With 800 physicians, Atrius is fully implemented on its Epic EHR across some 30 sites. “The EHR allows us to function as one large contracting entity,” noted Lindsey, adding that half of its 700,000 patients are being treated under global payment arrangements.

6. Without the Docs, ACOs Go Nowhere

In the ACO world, all eyes will still be focused on physicians. They may…

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Gary Baldwin is the Editorial Director for Health Data Management, and has been covering health care since the early 1990s. Prior to rejoining Health Data Management in 2008, he served as technology editor for HealthLeaders Medi for nearly five years.  


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