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.

 

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Accountable Care, ACO, Affordable Care Act

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.

 

 

Accountable Care, ACO, Affordable Care Act

ACOs: The Results So Far (It Depends)

by Gregg A. Masters, MPH

It might have been prescient but minimally it was perfect timing. While Fred Goldstein, President of Accountable Health, LLC, and me were prepping for our session to re-cap on PopHealth Week (@PopHealthWeek) some of the insights from our deep dive series into Population Health and ACOs, reporting insights from embedded executives at physician led, hospital sponsored and health plan enabled ACOs respectively, CMS yesterday (August 25th) posted the results from their participants in the MSSP and Pioneer Programs.

The Pioneer results are displayed below (for a description of the Pioneer program click here):CMS_ACO_Results_Pioneers
Again, while we’re still very early in this game, one bit of ‘cognitive dissonance’ that I experienced is worthy of note and further exploration.

That being the Heritage ACO a physician led enterprise fielded by managed care industry veteran and disruptive innovator Richard Merkin, MD, et al (including my former American Medical International colleague Mark Wagar, President Heritage Medical Systems and most recently CEO Empire Blue Cross and Blue Shield) untethered in any way from an institutional portfolio of healthcare infrastructure (i.e., hospitals) booked zero savings for distribution while hospital tethered and a card carrying member of the Association of American Medical Colleges (@AAMCtoday) (as the principal teaching hospital for Einstein College of MedicineMontefiore ACO booked massive (relative to ‘aligned beneficiares’) savings.

One must ponder the question and ask how can this be so?

It’s common knowledge that ACOs ‘untethered’ from (heads in beds) legacy hospital interests are more nimble and therefore better positioned to manage the volume-to-value transition. Further, when you add into the mix the history of successful risk assumption across a distributed network of ‘aware’ coordinated care practices (both IPA and medical group) you have a material competitive advantage.

So perhaps the ‘devil is in the details‘ as it often is, and the answers are to be found in the formulaic world of risk adjusters, corridors, baselines and severity of illness calculations. We hope top hear direct from Heritage ACO as this author has made that request a number of times previously.

Another interesting result that stands out as it arguably tethers to the presumptively competitively disadvantaged ‘health plan enabled‘ camp of ACOs is the incredible savings generated by the Banner Health Network (a Pioneer ACO), which if memory serves me well is a co-creation of Banner and Aetna via their ‘payor agnostic’ Healthagen subsidiary.

For complete details see the CMS release ‘Medicare ACOs Continue to Improve Quality of Care, Generate Shared Savings‘ and ‘Medicare ACOs Provide Improved Care While Slowing Cost Growth in 2014‘.

Meanwhile for a bit of reading the tea leaves color via Beckers Hospital Review see CMS releases 2014 Medicare ACO quality, financial results: 10 things to know):

1. Ninety-seven ACOs qualified to share in savings by meeting quality and cost benchmarks. Together, they earned shared savings payments of more than $422 million.

2. Fifteen of the 20 participating Pioneer ACOs generated a total of $120 million in savings in 2014, their third performance year. This is up 24 percent from the second performance year when they generated $96 million in savings. Of those that generated savings, 11 earned shared savings payments of $82 million.

3. Five Pioneer ACOs generated losses and three owed CMS shared losses of $9 million.

4. Pioneer ACOs increased their average quality scores to 87.2 percent in performance year three from 85.2 percent in performance year 2. They improved an average of 3.6 percent compared to performance year two on 28 of the 33 quality measures and showed significant improvement in medication reconciliation, clinical depression screening and follow-ups, and EHR incentive payment qualification…

Read complete article here.

Yes we do live in interesting times. And ideological prism not-withstanding there is no way this Genie (ACOs et al, and whatever formulaic derivatives may be forthcoming) gets put back in the bottle – the best efforts of Governor Scott Walker’s ‘bold’ The Day One Patient Freedom Plan (more likevaporware‘) effort to repeal and replace the Affordable Care Act.

This train has left the station. Time to deal with it?

Accountable Care, ACO, Affordable Care Act, health reform

ACO’s as Sinkhole Medicine? Nah…

By Gregg A. Masters, MPH

sinkhole

As the battle for the accountable care narrative grinds on both in the media and the respective P&Ls of participant ACOs, a recent article in Healthcare Finance News titled: Accountable care organizations: cost-effective solutions or financial sinkholes? is noteworthy.  At first I chuckled, then thought, more headline ‘eye porn’ or is there really a message here?

So lets start with the remark that caught my viscera –  the ‘sinkhole’ attribution. The piece is written by Paul Cerrato aka Twitter @plcerrato ‘a healthcare editor and writer for 30 years, publishing extensively in a variety of healthcare and business journals’. Pauls sets context for the sinkhole visual here:

But although the costs of care for all the Pioneer ACOs grew by only 0.3 percent, compared to 0.8 percent for similar Medicare beneficiaries outside the program, the fact remains that only 13 generated shared savings [emphasis mine]. Seven of the Pioneer ACOs have decided to move to other pay for performance programs that involve less financial risk, and two of the participating organizations have decided to leave Medicare accountable care altogether.

Then he tees up the underlying ‘Jerry Maguire‘ strategic question:

Given the uneven financial performance of these pilot ACOs, C-suite executives are no doubt wondering: What secret sauce allows some ACOs to succeed while others fall short of their financial goals?

While acknowledging the increased risk exposure to the Pioneers:

Any risk benefit analysis should keep in mind that ACOs come in many different sizes and shapes, and given that the Pioneer ACO model is riskier than the standard Medicare Shared Savings Program, it would not be fair to conclude that the ACO model is flawed, per se.

So digging a little deeper into Paul’s narrative, it’s not about the ACO model. The sinkhole remark is really about the de minimis cost impact associated with the performance of the Pioneer class. Yet, in defense of ACOs and the ACA (a position I am often in) we need take into account the key question of:

ACOs as sinkholes, compared to what? 

ACOs are proactive on a number of levels. Whether a statutory MSSP, or a pilot or demo via CMMI or a private mutation via the ‘ACO collaborations’ of Aetna, United, Humana or the Blues, they are something other than ‘biz as usual’. Anything less is the unrestrained appetite of the healthcare borg, i.e., a business as usual strategy. Bottom line is the current paradigm of healthcare costs, coverage and access is the SINKHOLE with or without an ‘ACO contribution’.

The article is worth a read since it points to both ‘culture’ and the ‘long term investment’ ACOs will require before generating an economic ROI. Unfortunately, tell that to CMS, as they are measuring two pillars of the triple aim (experience & quality), but the driver in the equation is fundamentally the third pillar – per capita savings at the population level.

 

 

Accountable Care, ACO, Affordable Care Act, health reform, MSSP

An ACO ‘Shell Game?’ Of Arrows, Pioneers & Patsies’

By Gregg A. Masters, MPH

In ‘Pioneers Take Arrows While Settlers’ Get the Land’ I reported in a ‘just the facts ma’am’ fashion the developing narrative as proferred by Modern Healthcare, CMS, and the AMGA as to whether this was to be seen as good news or bad news.

Pioneer with arrow in backRecently the witty industry veteran and futurist  Ian Morrison weighed in via ‘Why Some ACO Pioneers Turned Back, as did Oliver Wyman via ‘The Year of the Pioneers’ and even the health policy braintrust, aka the ‘…aw shucks, we just really want to help Obamacare out’ cheerleading squad at the American Enterprise Institute weighed in via ‘Reforming Medicare integrated care: An alternative to the Obama administration’s accountable care organizations. Whoa can you say bandwidth consumption?

Indeed, rather than parse out each, I will address them separately via individual consideration. I just wanted to get them on the blog before more time passed.

I might add that as far back at June of 2012 at the jointly sponsored CAPG (California Association of Physician Groups) and IHA (Integrated Healthcare Association) ACO Congress word on the streeet had it  ‘all was not well in Pioneer land’. So fresh as some of these insights and realization may claim to be, some of the more chronic challenges have been on the record for quite some time.

You  might enjoy the reading ‘From ‘Unicorns to Multicorns” ACOs Morphing Below Radar’ which followed the ACO Congress.

As some say….

More will be revealed

Accountable Care, ACO, Affordable Care Act, health reform

The ACO Innovation Summit

By Gregg A. Masters, MPH

One of the few ACO gatherings I’ve missed since the birth of the industry (and there have been quite a few since there are ‘experts’ everywhere), but the line-up NEHI put together is well worth a look.

Both Steven Shortell and Molly Coye are definitely change agents on the front lines as is the balance of the faculty. Molly is pulling levers of a major institution with, some might say, an impossible reinvention agenda given its governance complexity and cost efficiency obstacles – unlike many other private institutions similarly challenged, while Shortell has a pulse on the healthcare ecosystem DNA, the macro policy dynamics of managed competition, and the empirics of business or service delivery models that work.

 

Thanks to the organizational initiative of NEHI staff. A bit of a delay (this is raw footage), but fast forward to 9:10 mark for introductory remarks by NEHI President Wendy Everett, ScD. About NEHI:

‘…NEHI is a nonprofit, health policy institute focused on enabling innovation that will improve health care quality and lower health care costs. Working in partnership with members from across the health care system, NEHI brings an objective, collaborative and fresh voice to health policy. We combine the collective vision of our diverse membership and our independent, evidence-based research to move ideas into action.’

As discussed elsewhere the battle at the moment is for the narrative on ACOs and by proxy the Affordable Care Act aka “Obamacare”. For context see: The ACO Narrative: ‘Accountable Care 2.0 is a Journey, Not a Program’ or ‘ObamaCare is Toast’? 

 

Key take-aways from the summit included:

  • ACOs necessitate thinking about “packaged” innovations – the organizational culture, process improvements, and payment models that surround a particular innovation.
  • Bundled payments, global budgets and other new ACO payment innovations are beginning to create the “markets for health” that will move the system from a culture of care to a culture of wellness.
  • In an ACO world, physicians require comparative effectiveness research, real world evidence, and ongoing guidance from industry to achieve improved patient outcomes.
  • ACOs are transforming the research landscape by turning previously unintegrated health systems into research organizations.
  • ACOs have created new opportunities for cross-sector partnerships to share data and enhance the pace of innovation.
Accountable Care, ACO, Affordable Care Act, health reform

The ACO Narrative: ‘Accountable Care 2.0 is a Journey, Not a Program’ or ‘ObamaCare is Toast’?

Earlier today we spoke with Dr Jerry Penso, Chief Medical and Quality Officer for the American Medical Group Management Association (AMGA), and Jim Hansen, Vice President at the Accountable Delivery Systems Institute (ADSI) a unit of Lumeris.

To listen to the broadcast click on the ‘This Week in Accountable Care’ graphic below:

This Week in Accountable Care | @ACOwatch | Hosted by Gregg A. MastersThe context for the chat was the release by CMS of year one results reported by the 32 participants in the ACO Pioneer program.

For Jim Hansen’s thoughts on the ‘journey’ noted above, see: Accountable Care 2.0: It’s a Journey, Not a Program. Jim’s noteworthy highlights include the metrics reported below:

‘CMS released a long-awaited checkpoint status on its Pioneer ACO program. Of the 32 entities enrolled in the program, according to CMS:

  • 2 (6%) will leave the CMS ACO program altogether
  • 7 (22%) will eliminate the down-side risk component by reapplying under the MSSP program
  • 32 (100%) improved quality of patient care & rated highly on patient satisfaction scores
  • 18 (56%) achieved some cost savings, 13 (41%)saved enough to share savings with Medicare
  • 2 (6%) cost Medicare more and will owe $4M back
  • 12 (38%) did not achieve significant savings•
  • $140M in total savings, $52.4M in total losses, $76M in shared shavings to be returned to 13 (41%)Pioneers
  • $33M in net savings for the Medicare Trust Funds.’

For additional context – both narrative and ‘moving the needle’ transformational – with links to the original CMS announcement, see: ‘Pioneers Take Arrows While Settlers’ Get the Land?’ or Michel Millenson‘s informed, witty and dead on accurate take on ‘This Week in Health Innovation’. To quote Michael, per the attributed impact of the ACA irrespective of the relentless attempts to appeal ‘ObamaCare’:

we’re finally moving the iceberg…