Accountable Care, ACO

On Lessons NOT Learned from Managed Healthcare v1.0 and Beyond

by Gregg A. Masters, MPH

First in a series of lessons NOT learned tweets to be enhanced and re-posted to @ACOwatch.

In the 80s Sanford C. Bernstein analyst Kenneth Abramowitz predicted for-profit hospital systems would dominate the market by 2000. One of the strategy ‘diversification arrows‘ in the quiver of hospital system executives was to enter the insurance market via managed care strategies of various strains. During this consideration phase, my then employer American Medical International (AMI) elected (against my counsel) to build its own insurance company dubbed ‘AMICARE’ vs. creatively ‘parter’ with the insurance sector. /1

Editors Note: See: ‘SuperMeds Hoping to Reshape System‘ by colleague Michael Millenson.

/2 Context: Abramowitz predicted the relative competitive under-performance of 501c3 hospitals & thus their parents. Too clunky and with the wrong governance structure they’d be swarmed by their more nimble for profit operators with easier access to the capital markets required to support a full range of acute care services.

/3 Hospital Corporation of America (HCA) (follow @HCAhealthcare), National Medical Enterprises (NME)  & AMI (merged into @tenethealth) dominated the emerging for-profit sector. Humana was actively repositioning itself from a hospital owner/operator into a health insurance company with a robust portfolio of managed care products.

From major academic medical centers (see: ‘Corporate Takeover of Teaching Hospitals‘) to regional non-profits, c-suite strategists were aggressively courting their engagement given bond debt service coverage requirement concerns amidst an uncertain future.

/4 While all major systems where looking into ‘integration model 1.0’ (recently and cleverly rebranded as ‘pay-vidor’) the mission critical decision in board rooms was: ‘do we make, buy or lease’ the infrastructure? Some sensibly chose the ‘payor neutral’ route, while others built brands.

/5 As then ‘director health system development’ @ AMI California, and previously serving as founding member of Preferred Health Network (PHN) now portfolio company @UnitedHealthGrp post Pacificare acquisition, I counseled AMI to NOT build AMICARE, but partner with the ecosystem as a payor neutral aligned, managed delivery system.

/6 The theory was don’t compete with insurance companies but learn to partner and co-brand local market products from PPO to HMO to POS and ‘OWAs’ (other weird arrangements). Furthermore hospital operations & insurance company cultures were ‘oil and water’ and would not mix. More later (think pre @texashealth formation where Presbyterian Healthcare and Harris Methodist Health Services merged and the health plan leadership where shown the door while DFW market dominant Harris Methodist Health plan was shopped to Pacificare).

/7 Rather than ‘risk’ the payor neutral, lack of vertical integration control (the lessons forged at PHN) and what I advocated at AMI, most majors’ (including 501c3s) with some local market (operations & branding) variations chose to ‘build’ vs. partner. #wrong #move 

/8 I digress. On the branding thing (another wrongly reasoned corporate brand extension decision), what’s wrong with the pictures above? At AMI I advocated that the product/service is the local market asset (a co-branded insurance product) and NOT an extension of corporate nameplate!

/9 I reasoned hospitals serve as ‘hubs’ of community trust (not too mention economic engines and potential integrators of the then dominant independent practice of medicine) & thus the assets to brand & market locally. A sensibly if not delicately calibrated blending of corporate vs. local market identity is more likely to create the goodwill & trust to build upon. Again I was over-ruled by corporate marketing gurus shopping a corporate branded nameplate. For example, all AMI hospital names were preceded by AMI, e.g., AMI Tarzana Regional Medical Center, AMI Irvine Medical Center, etc. 

/10 There’s much more to the story here. This is just an install in the hospital/insurance dance we’ve witnessed in the 80s-00’s playing out today and in some respects completely oblivious to painful lessons of the past (think NorthWell Health’s strategic entry and rapid exit from provider sponsored health plan ownership due to massive losses).There’s a similar story on hospital/health system side (both branding and strategy), to be elaborated in a separate post. 

/11 Concluding thread as follows. So what happened to those systems who elected the ‘build’ option? Massive losses & write-downs were reported with d/c operations posted to the balance sheets of public companies’. The gamble of assuming ‘insurance risk‘ was repelled as if the plague. Health plan or health insurance division employees were looked upon with suspicion. Welcome to FFS maximization era which reigned supreme until the recent round of re-engagement with managing the burden of the total costs of care (think triple aim) envisioned by various risk transfer provisions in the Affordable Care Act (ACA), where Accountable Care Organizations (ACOs) serve as the principal – but not exclusive – workhorse.

Comments:

Hey @VinceKuraitis, please checkout thread 1 – 11 below. Would love your thoughts and commentary. c #ACOchat #phychat #hcldr #JPM19 @jpenso1 @DonCrane @Farzad_MD @bobkocher @DrShlain @sgschade @davidmuntz @RejuvalifeBH @NACOMSO @NicoleBradberry @drnic1

Gregg Masters MPH @2healthguru

Replying to @2healthguru @jpenso1 and 10 others 

Vince Kuraitis @VinceKuraitis

Nice thread. On point.

IMO the jury is back — high probability of failure/$$ loss. (Most) hospitals do not have expertise, culture, patience, scale to become successful health plans.

Newer model of hospital/health plan JV MUCH more promising, e.g., Aetna + Inova.

John Moore @john_chilmark

Replying to @VinceKuraitis @2healthguru and 11 others

It may be promising Vince but we’ve been studying this for several years and still dumbfounded by the shear amount of distrust between provider and payer.

Requires a degree of transparency that few are willing to abide

 

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Accountable Care, ACO, Direct Primary Care, DPC

From HMOs and PPOs to ACOs and DPCs: What’s Next?

by Gregg A. Masters, MPH

It may come to a surprise for some  that ‘healthcare innovation‘ has been in play for quite some time albeit not fueled by a culture of hacking or disrupting legacy operations principally via technology. Unfortunately a veritable acronym soup of mostly failed initiatives under varying degrees of public, private partnership (PPP) collaborations have been largely unsuccessful albeit with momentary pauses to the growth rate of healthcare or its underlying medical care cost (MCC) inflation.

When I started in the space national healthcare spend represented 6% of GDP (today, last reported at 17.9%) and many of the same stakeholders were then complaining about its unsustainable trajectory, un-affordable health insurance premiums, wide variations in quality and the uneven access created by a confusing universe of often conflicting payor class (or ‘book of business’) driven reimbursement requirements.

Back then, we witnessed the launch of professional standards review organizations (PSROs) who’s mission was to develop what many referred to as ‘cookbook’ medicine guidelines for purposes of utilization review and medical necessity determinations that health maintenance organizations (HMOs), and to a lesser degree preferred provider organizations (PPOs), deployed via a range of products introduced as ‘managed healthcare’.

HMOs were seen as ‘closed loop‘ systems principally built upon ‘staff models’ where physicians were health plan employees (think Kaiser Permanente, though technically a ‘group’ vs. staff model), Cleveland Clinic, or Geisinger Health plan and thus had not penetrated either mainstream medicine nor commercial market customers (employers, coalitions, multiple employer trusts or purchasing cooperatives, etc.) that Aetna, Cigna, United and Blue plans designed, underwrote and marketed a range of self funded and fully insured insurance products. Both Medicare and Medicaid remained untapped ‘managed markets’ as well. Thus the lion’s share of both public and private markets were in traditional domain of unbridled fee-for-services medicine based on usual and customary pricing or payment schedules tied to conversion factors associated with resource based relative value units (RBRVU).

This began to change with the introduction of independent practice associations (IPA) supported by a competent management services organization (MSO) or physician practice management company (PPMC) providing back office support needed for private physicians in independent practices to contractually engage with health plans. This pivot began an era shifting risk from the health plan to the contracted provider network via a range of reimbursement models.

From modest withholds on negotiated fee-for-services schedules, to global or service tiered per diem’s, case rates or in the most aggressive arrangements an outright delegation of global (including hospital) or partial (professional services only) risk. The latter typically involved mature multi-specialty or primary care group practices with professional management, supporting culture and the associated infrastructure to bear the risk burden.

The aggregate impact of the frenzy that followed by huge market share gains in the HMO space and a correspondingly similar growth in the PPO market was a medical trend reduction and at one point temporary negative decline in healthcare and medical cost inflation indices relative to GDP the late 80s to mid 90s.

Yet, the cultural flash point was perhaps best captured by a scene in the movie ‘As Good As It Gets’ when actress Helen Hunt weighed in on her ‘piece of sh*t HMO‘ denying her access to covered services. As I recall, the entire audience laughed identifying with her animus towards HMOs.

This moment in popular culture represented the public’s push back to ‘gatekeeper model‘ HMOs where primary care physicians ran interference between a member and his or her referral to a specialist consult or hospital admission.

To meet rising consumer frustration and the employer sponsors the plans growing concerns. right around this time (circa mid to late 90s), United Healthcare introduced PPO plans and ‘direct access’ HMO versions as well that permitted specialist referrals without the consent of the primary care gatekeeper.

What soon followed was an era of risk push-back particularly as more consumers rebelled against gatekeeper HMOs, and a lot of red ink for risk bearing IPAs, medical groups or even PHOs (physician/hospital organizations) who took on health plan risk, incurring massive operating losses. While premium increases were restrained to declining, the per member per month (PMPM) or percentage of premium contract dollars passed to participating risk bearing providers represented declining baselines for payment of covered services.

Back to the Future: ‘Deja Vu’ Again?

With the passage of the Affordable Care Act (ACA) principally designed to increase access, reduce the rate of uninsured Americans’ and lay the seeds of cost containment innovation principally via Accountable Care Organizations (ACOs) – the majority participating in upside gain share only in the Medicare Shared Savings Program (MSSP) – but also encouraging pilots and demonstration efforts at the Center for Medicare and Medicaid Innovation (CMMI) we’ve re-entered another era of measured risk transfer 2.0 with the provider community (i.e., hospitals, physicians and allied health practitioners).

As the principal workhorse in the ‘innovation lab‘, six years in ACOs have been a net disappointment in terms of producing the expected savings – though their quality performance metrics are a different story – initially envisioned leading up to the law’s passage. Yet amidst contentious and shifting sands of both federal and state health policy guidance in the transition from the Obama to the Trump administration, one goal remains intact with seemingly solid bi-partisan support: the continued investment in and active pursuit of a value based (vs. production fueled fee-for-services) healthcare economy. Whether via top down federal policy or the granular baking of innovation from the grassroots up, we’ve returned to the drawing board of finding a delivery and financing system that can deliver on the promise of the triple aim – better care, better outcomes at lower per capita costs.

Enter Direct Primary Care aka ‘DPC’

In 1913 Dr. Charles Mayo one of the three founding brothers of the Mayo Clinic weighed in rather optimistically on the future of medicine delivered primary via seamless, team based healthcare. Yet, some 100 plus years later, are we there yet? I think the answer is a resounding no. But why the glacial pace of progress in a seemingly transformation resistant healthcare industry?

With layers of failed generational innovation and the inherent complexity grafted on each wave of the transformational impulse, we as an industry of stakeholders writ large (i.e., hospitals, physicians, regulators, payors, brokers, underwriters, investors and a litany of too numerous to mention suppliers and vendors at the trough) have co-created an incoherent, inefficient, costly and burdensome ‘provider centric’ healthcare economy with conflicted incentives, and little to no alignment with the mission towards building a quality, affordable healthcare economy that works for us al

In 2018 this de-facto ‘non-system‘ aggregate is at risk of imploding on itself. No-one is happy. From frustrated patients, to disillusioned clinicians, to disaffected employers and a somewhat drifting [see: ‘Rethinking The Physician-Focused Payment Model Technical Advisory Committee (PTAC)’ which addresses the ‘rising tensions’ between PTAC, and HHS] federal government are all scrambling to find solutions that deliver value.

A novel model launched in the late 90s by Garrison Bliss, MD introduced ‘direct primary care‘ (DPC) initially via Seattle Medical Associates which then re-tooled into the Qliance brand. Qliance created a fair amount of buzz and spawned considerable competition while advancing the standing of DPC. Yet, a ten year run promptly came to an end when Qliance ceased operations in June of 2017.

Dr Bliss’s legacy contributions live on as he cleared the path for DPC in the state of Washington via enabling statute. DPCs are required to register and report annually (2017 report, here) to the Department of Insurance (definition of DPC, here) a basic data set including: fees charged, enrollment, participating physicians and practice locations. He also presided over the inclusion of DPCs in Qualified Health Plan offerings listed on ACA exchanges. See below:

Treatment of Direct Primary Care Medical Home, 76 Fed. Reg. 41900 (July 15, 2011) (amending section 1301(a)(3) of the Affordable Care Act) 

A “Direct Primary Care Medical Home” plan is defined as “an arrangement where a fee is paid by an individual, or on behalf of an individual, directly to a medical home for primary care services, consistent with the program established in Washington.” (Federal Register Citation)

Meanwhile, the data since reporting began in 2007 is instructive on the limited appeal and slow uptake to date of the DPC model in the population at large, and in my view represents a bellwether for the rest of the nation, see HintHealth 2017 survey here, further documenting the very limited penetration of DPCs into the mainstream market.

Thus, Washington state became the first state to define and regulate direct primary care practices and to prohibit direct practice providers from billing insurance companies for services provided to patients under direct practice agreements.

  • Ten years later, DPC enrollment totaled 14,790 direct practice patients out of 6.7 million Washington state residents, a 0.22 percent share of the population
  • Overall patient participation increased 31%, from the fiscal year 2016 total of 11, 272 participants to 14,790 (an increase of 3,518 participants)

Under the Hood of a DPC: Is it ‘HMO Lite’?

First up, let’s examine one definition proffered by a visionary DPC advocate and practitioner who is also a practicing attorney, Phil Eskew, DO, JD:

For the practice to qualify as a direct primary care practice, the practice must:

  • Charge a periodic fee
  • Not bill any third parties on a fee for services basis; and
  • Any per visit charge must be less than the monthly equivalent of the periodic fee

At it’s core a DPC looks like and to some degree models a ‘lite’ version of a PCP gatekeeper HMO. This includes monthly global prepayment, a defined set of covered services, an assigned patient (member) panel (albeit considerably smaller than a participating PCP in an HMO), and since compensation is budget driven and prospectively paid – little if any of the billing and coding complexity associated with the traditional billing and collections model of FFS based PCP practices.

Unlike an HMO a DPC is not a risk bearing concern other than the sponsoring physicians who go at risk for their professional services. In fact most DPCs are strongly encouraged to operate in a safe harbor of what might otherwise be deemed to be operating in the business of insurance as unlicensed and thus illegal entity.

While not a risk bearing operation per se, DPC models operate in the wild west, where if you’ve seen one practice’s footprint, you’ve seen one DPC operation. There are no standards and there are no compare and contrast opportunities. DPCs are in no way a homogeneous group, rather they are the byproduct of a patchwork of state laws, and the goals, competencies and intentions of the owner physicians.

DPCs must refer out all hospitalizations, outpatient surgeries, costly imaging or lab testing, and specialist consults, etc. Thus DPC practices will optimally work only when layered into ‘wrap around’, catastrophic or prevailing high deductible or rebranded ‘consumer directed’ health plans – though some DPC models, i.e., My MD Connect and others, are designing products for brokers and stop loss carriers offering health plan options for self insured employers built on a network of participating DPC practices.

Some DPCs will negotiate with select preferred specialists, routine lab testing and for certain imaging services. But each practice will have a different menu of primary care services and what may be included in referred care.

Market Results

In a recently published article at the Journal fo the American Board of Family Medicine titled: Direct Primary Care: Applying Theory to Potential Changes in Delivery and Outcomes, the author concludes as follows [emphasis bolded mine]:

The need for rigorous research on the DPC model is great. The American College of Physicians has made such a call, beginning with the most basic descriptive patient and provider variables.41 Information on participating patient demographics before and after DPC adoption is required to understand the population that is served by DPC and the broader implications for excluded patients. Research on the patterns of DPC location and socioeconomic context would also provide a better understanding of DPC’s niche. Following these descriptive analyses, the focus must shift toward outcomes and the attainment of the 4 attributes of primary care, with comparisons between DPCs and other models of primary care. Although this research will encounter obstacles, such as the absence of claims data for DPC practices, it is essential to guide providers, patients, and policy makers toward high-quality primary care.

Meanwhile, theoretic application informed by years of research on primary care provides insight as to what changes to expect and to monitor as practices consider DPC adoption. By applying Starfield’s conceptual model, an understanding of the potential changes to structures, processes, and outcomes for the patient population can be achieved while policy makers and providers await rigorous research on DPC. Evidence exists to support DPC as a theoretically sound approach to attaining the attributes of first contact care and longitudinality for participating patients. DPC uses changes to financing and the population eligible to trigger these potential improvements. At the health system level, DPC has low-construct validity to support a positive impact on the potentially eligible population. By limiting access to those willing and able to pay the membership fee, a vulnerable population will almost certainly be excluded. A model that does not meet the needs of a vulnerable population is unlikely to have a significant impact on the overall costs and outcomes of the US health care system. Other policies and models to address primary care financing and accessibility that do not exclude groups of patients exist and may or may not be superior to DPC. DPC’s distinguishing characteristic from these other models is that the control rests with the PCP and is not dependent on financing from third-party payers.

Complete article: Direct Primary Care: Applying Theory to Potential Changes in Delivery and Outcomes

The Road Ahead

For DPCs to scale and make a systemic impact beyond the local community in which their owners/sponsors operate and become more than a lifestyle, ethical decision or political statement giving the finger to ‘the man’, they’ll need to somehow get their arms around ‘downstream’ network risk and define certain minimum operating requirements or standards which apply to all DPCs equally.

Though therein lies part of the problem. The safe harbor contours mentioned earlier is not iron clad and is more or less protected by variable states statutes exempting DPCs from being in the business of insurance. Any argument that can validly be made that the DPC is assuming ‘risk’ beyond the primary care services in the contract between the DPC practice and its members is one more arrow in the quiver of state department of insurance commissioners’ tasked with the protection of patients purchasing health insurance.

Two groups have organized to harmonize and advance the practice of DPC including the Direct Primary Care Coalition and DPC Alliance, the former chaired by Garrison Bliss, MD (see leadership here) and the latter Ryan Neuhofel, DO, MPH. Both proactive and visionary physician leaders committed to supporting and leveraging the business model of DPC given the heterogeneity of its member practices.

ACO and DPC Synergies?

While I do not have a business plan or model for a hybrid version or combination ACO/DPC derivative, it seems a venn diagram can identify characteristics common to both operating footprints mentioned above. Since we’re all still looking for ways to tame the rapacious appetite of a seemingly insatiable and predominantly fee-for-services fueled healthcare delivery and financing ecosystem, what do we have to lose?

Let’s think out of the box! We can do this!

 

 

 

 

Accountable Care, ACO, Affordable Care Act

The Evolution of ACOs

by Gregg A. Masters, MPH


Recently the accountable care industry’s leading ‘skin in the game‘ PPMC 2.0 aka ACOcor equivalent (think PhyCor, MedPartners, FPA Medical, et al) of our time – though Aledade’s model is anything like the pyramid scheme of the PPMC (physician practice management companies) of the 1990s, reviewed the Center for Medicare and Medicaid Services (CMS) recent Notice of Proposed Rule Making (NPRM): CMS Proposes “Pathways to Success,” an Overhaul of Medicare’s ACO Program‘. 

Below are key take-aways from the presentation. The entire webinar is accessible free upon registration here

I will post the Q & A thread that Farzad Mostashari, MD, CEO and Travis Broome, VP, Health Policy, respectively Aledade shared on twitter as well.

Meanwhile, here’s the gist of their analysis and message:

Accountable Care

In Pursuit of the Triple Aim: Can Population Health Management Lead the Way?

By Fred Goldstein, MS and Gregg Masters, MPH

Every sector in health care is under pressure to articulate and implement a viable population health initiative that delivers on the triple aim of better health, better quality at a better cost.

Despite a significant investment of resources, we have only achieved ‘mixed results’ to date, and so the industry remains in a continuous learning mode. Although we’ve taken away some insights, we still have a long way to go.

Recently on Pophealth Week, we chatted with the ‘Dean’ of Population Health who spearheaded and continues to steward the nation’s first freestanding College of Population Health at Jefferson University in Philadelphia. David Nash, MD, MBA weighed in on the industry’s evolution — including best practices to emulate —and what near term challenges we are likely to face.

To listen to Dr. Nash’s take, click here, and for additional context checkout The Road From Volume-To-Value: The Pivotal Role of Population Health.

If you’ve worked in this space – at the strategy or operational level — you know that it can be truly daunting to implement a population health program. This can lead some organizations to shy away from attempting meaningful programs, perhaps even into a copycat ‘me too’ effort. Given the inevitable drive to value-based care, it is a strategic imperative to understand how to build and implement population health initiatives that work.

In its simplest framework, one can think of a population health program in terms of the following components as articulated by the Population Health Alliance Outcomes Guidelines Report Volume 6,  2015.

The steps of the Population Health Framework as shown in the image above include:

  • Identify the population
  • Assess the person for risk(s)
  • Stratify the person into risk levels to target for various interventions
  • Engage the person in a program
  • Intervene with specific services and resources and
  • Measure the process and outcome results

These results are then fed back into the system and the process continued all seeking to improve the overall health of the population.

In Search of Answers

One forum many look to for best practices and key insights is the Population Health Colloquium, now in its 18th year with the Jefferson College of Population Health as academic partner. Scanning this year’s Agenda, one can find presentations in each of the elements above.

Data and Analytics are the essential ingredients of any population health program with intent to identify individuals, assess them for various risks or conditions, stratify them to ensure appropriate levels of intervention and measure a program’s success.

Within the area of assessment, we are moving to an ‘N of 1’ approach given the advances in precision medicine and genomics. This exciting area will be covered at the conference in the mini summit entitled Personalized Medicine, Machine Learning and Genomics: a Clinical Approach to Employer Population Health and Wellbeing.

Payment models and the move to value-based care are among the key levers. Although there have been more than a few stops and starts along the way with the change in administration at the federal level, employers are rapidly embracing these approaches.  There are a number of presentations on this topic, including Journey to Value-Based Care — Experience and Expectations, Accountable Care Atlas: Mapping a Path to Value-Based Care and a Mini Summit ACOs at an Inflection Point: Where the Movement is Headed and Why Some Succeed While Others Don’t.

In the Intervention area, there are presentations covering ‘On the Ground: Population Health initiatives’… and we can’t forget about the patients — they, too, have a strong role to play in these efforts. The Mini Summit, Improving Patient Care and Provider Experience through Population Health Management, is timely and informative.

Community-based programs have become all the rage as we better understand the impact on your health based on where and how you live.  A breakout track entitled Population Health in the Community includes discussions on life expectancy gaps in Chicago; Rural and Urban Issues; and primary care and behavioral health that will address some of the approaches.

The program will feature a session on designing and implementing population health, and of course there will be some incredible keynotes and small panel discussions. The program includes a discussion with two former HHS Secretaries, Tommy Thompson and Michael Leavitt, and baseball great Darryl Strawberry will discuss addiction, a critical issue we are now facing with the opioid crisis.

If you are committed to learning more about Population Health, this meeting is a must. It’s an event where you can learn from experts covering the full breadth of population health services and have an opportunity to network. Whether you choose to travel to Philadelphia or attend via live webinar, please plan to join us and stop by to say hello. We’d love to hear all about what you’re doing in this exciting space.

==##==

This post is sponsored by the Jefferson College of Population Health

Accountable Care, ACO, Affordable Care Act

Center for Medicare and Medicaid Services Releases Accountable Care Organization Performance Results

by Gregg A. Masters, MPH

Friday, October 27th, the Center for Medicare and Medicaid Services (CMS) released details for participating Accountable Care Organizations (ACOs) in the Medicare Shared Savings Program (MSSP) for the 2016 performance year.  For reporting ACO results view the entire report here.

The National Association of ACOs (NAACOs) weighed in below:

The new results demonstrate the value of a premier Medicare alternative payment model and include a higher rate (56 percent)* of MSSP ACOs generating savings than ever before and an almost equal proportion as last year of ACOs that earned shared savings (31 percent).

This public update follows previously posted results for Pioneer ACOs, the Next Generation ACO cohort and the Comprehensive End Stage Renal Disease ACO (ESRD) care model here.

In table form, the results are summarized below:

All in, participating ACOs generated $843 million in gross program savings with a modest net savings of $78.6 million for Medicare in 2016, in addition to material gains in quality scores for aligned ACO Medicare beneficiaries.

While Clif Gaus, NAACOS CEO notes:

These results show the growing success of ACOs, which is a positive trend that should not be ignored. A lot has been accomplished in a relatively short amount of time, and ACOs are on the front line of redesigning healthcare delivery. This is a moment to celebrate them and their hard work.

The ACO ‘Jury’ Is Still Is Out

Given the range of models, risk assumed or gain sharing distributed operating results in a program that some still see as fundamentally ill equipped in a predominant fee-for-services market to materially change physician and beneficiary behavior – and thus enable the elusive ‘triple aim‘ – many in the health policy area including select ACO operators remain convinced to maximize impact the ACO model will ultimately morph into the more robust Medicare Advantage operating platform.

Perhaps the ‘stealth play’ in the mix is the potential upside of Next Generation ACOs to fully leverage their competitive advantages (3 day SNF waiver, telehealth visits, relaxed supervision requirements for post hospital discharge visits and the move to all inclusive population based payments) can up-level both their game AND improve outcomes at lower per capita costs?

On the next episode of This Week in Accountable Care, our very special guest is former Acting Administrator of CMS Andy Slavitt, now Senior Advisor to the Bipartisan Policy Center. Andy was initially part of the ‘fix it dream team‘ that righted the failed launch of Healthcare.Gov, and then presided over the administration of the Affordable Care Act.

Andy is rather familiar with the original intent of the ACA, its many ‘working parts’ and the bumps in the road to perfect the law via provider input, updated rule making and policy refinements.

We’ll get Andy’s take on a range of issues from the political environment to conflicting health policy guidance including broad brush advice to ACO operators.

Join National ACO co-founders Andre Berger, MD and Alex Foxman, MD as we engage this visionary and accomplished entrepreneur turned public service official in critical dialogue impacting the transformation of our industry from its fee-for-services roots to a new model based on a value and patient centricity.

 

Accountable Care, ACO, Affordable Care Act, Triple Aim

ACOs Fudging the Numbers?

by Gregg A. Masters, MPH

I came across this piece on the Healthcare Blog penned by Kip Sullivan, Esq, critiquing this article posted in Health Affairs last May ‘Bending The Spending Curve By Altering Care Delivery Patterns: The Role Of Care Management Within A Pioneer ACO‘. Sullivan raises valid points as the the legitimacy of claiming or inferring statistically insignificant results as a meaningful contribution of the subject ACO (a Partners Health sponsored venture) to ‘bending the cost curve’.

Sullivan un-bundles his argument effectively and raises issues for the industry writ large – including participating ACOs, their sponsors, the regulatory crew at both CMS and CMMI – and even the health policy press covering the sector.

I post the first few paragraphs of the piece below, for full reference the entire article on the Healthcare Blog is accessible via On the Ethics of Accountable Care Research‘.

  • Is it ethical for health policy researchers to claim that a Medicare ACO reduced “spending” by 2 percent if the reduction was not statistically significant?
  • Is it ethical for them to do so if they made no effort to measure the cost to the ACO of generating the alleged 2 percent savings nor the cost to Medicare of giving half the savings to the ACO?
  • Does it matter that the researchers work for the flagship hospital within the ACO that was the subject of their study?
  • Does it matter that the ACO and the flagship hospital are part of a huge hospital-clinic chain that claims its numerous acquisitions over the last quarter-century constitute not mere empire-building but rather “clinical integration” that will lower costs, and the paper lends credence to that argument? 
  • Is it ethical for editors to publish such a paper? Is it ethical to do so with a title on the cover that shouts, “How one ACO bent the cost curve”?

These questions were raised by the publication of a paper  by John Hsu et al. about the Pioneer ACO run by Partners HealthCare System, a large Boston hospital-clinic chain, in the May 2017 edition of Health Affairs. Of the eight authors of the paper, all but two teach at Harvard Medical School and all but two are employed by Massachusetts General Hospital (MGH), Partners’ flagship hospital and Harvard’s largest teaching hospital. [1]

Partners has been on a buying and ….

Comment

As someone who’s been in this dance since the mid 70s (PSROs, HSAs, HMOs, IPAs, PPOs, EPOs & all derivative plays) launched into Medicare risk via TEFRA (the Tax Equity and Fiscal Accountability Act) which introduced us to ‘Medicare Choice’ the for-runner of Medicare Advantage, I can say Sullivan’s critique of fully ‘burdening‘ ALL transformational efforts is rarely – if ever – factored into the volume to value pivot ‘investment calculus‘ of the effects of the intervention (in this case a Pioneer ACO) on the national spend.

It should be noted, the entire managed care industry can be assessed a gigantic collective FAIL for that matter as well. Since managed care penetrated ‘mainstream medicine‘ principally via extension of the HMO model typically on an IPA (independent practice association) chassis (vs. group or staff models) with the exception of a brief period in the 90s premiums continue their relentless upward march; while most payors continue to write commercial business only via an enterprise and industry wide cost shifting (risk transfer) charade. The tacit admission that there is no there there in the prevailing health insurance industry zeitgeist. They’ve proven they can NOT manage clinical risk, period.

So Kip, you might want to go a little lighter on those on the front lines trying to tame the ‘rapacious appetite’ of our ‘healthcare borg‘!

 

 

Affordable Care Act, BCRA 2017

CBO Weighs in on Trumpcare 3.0

by Gregg A. Masters, MPH

The non-partisan Congressional Office weighed in today on the impact of the Better Care Reconciliation of of 2017 as amended and rebranded as the ‘Obamacare Repeal Reconciliation Act’.

Their summary notes the coverage impact as follows:

  • The number of people who are uninsured would increase by 17 million in 2018, compared with the number under current law. That number would increase to 27 million in 2020, after the elimination of the ACA’s expansion of eligibility for Medicaid and the elimination of subsidies for insurance purchased through the marketplaces established by the ACA, and then to 32 million in 2026.
  • Average premiums in the non-group market (for individual policies purchased through the marketplaces or directly from insurers) would increase by roughly 25 percent—relative to projections under current law—in 2018. The increase would reach about 50 percent in 2020, and premiums would about double by 2026.

On the fiscal impact the graphic lays it out below:  For a complete CBO report, click here