FEBRUARY 28, 2012

Welcome to the Accountable Care Update eNewsletter
This issue is sponsored by Pay for Performance Summit

Thomson Reuters Identifies Critical Metrics for Accountable Care Organization Success
The difference between a successful Accountable Care Organization (ACO) pilot program and a well-intentioned failure could come down to just four key metrics, according to a new white paper published by Thomson Reuters. Thomson Reuters recently developed a model to estimate the expected financial impact of a Medicare ACO. The model uses baseline utilization and cost data for a specific organization that can be derived from public data sources and has been applied by several organizations to understand the likely opportunities and challenges of this payment model, specific to their attributed population. (Health News Digest, February 21, 2012)

Accountable Care Organizations Moving Away From Fee-for-Service Health Care Model
Accountable Care Organizations are bringing corporate-style metrics with them to the health care industry, with the goal of moving the U.S. model away from fee-for-service to pay-for-performance in the next few years. Among the questions communities are asking themselves is "Are we ready?" and, if not, "How do we get ready?" (Memphis Business Journal, February 24, 2012)

New AMA How-to Manual on Emerging Physician Payment Models
The American Medical Association (AMA) has released a new how-to manual to help physicians evaluate, negotiate, and manage budget-based payment systems that are becoming alternatives to the predominant fee-for-service model for reimbursing physicians. Typical budget-based payment systems include payment bundling, pay-for-performance, withholds and risk pools, capitation and shared savings. (American Medical Association, February 24, 2012)

Accountable Care Abroad
The United States grapples with the same problems that developed nations all over the world face, says Bill Crounse, MD, senior director for Worldwide Health at Microsoft Corporation. Many countries are caught up in healthcare reform, as well as changing populations and staff shortages. The same conversations about accountable care-quality, cost, access and satisfaction, as well as organizational change, information technology and payment reform-are taking place all over the world. (HIT Exchange, February 23, 2012)

CMS Posts MLR Guidance: Payments To Entities Such As IPAs, PHOs, And ACOs
CMS posted additional sub-regulatory guidance regarding the Medicare Loss Ratio (MLR) under Section 2718 of the Public Health Service Act, as added by the Affordable Care Act (ACA). The MLR requires health insurance issuers to submit a MLR report to the Secretary of Health and Human Services and issue a rebate to enrollees if the issuer's MLR is less than the applicable percentage threshold established in Section 2718. This additional guidance provides an important clarification sitting at the intersection of the MLR, payment reform, and more collaborative approaches to payment and care coordination arrived at between private payers and providers. (mondaq.com, February 22, 2012)

From Volume to Value: Cigna's Collaborative Accountable Care Programs
Americans spend enormous sums of money on healthcare, but that hasn't resulted in a healthier population. Chronic conditions, such as diabetes and heart disease, continue to take a toll on millions of Americans, while healthcare costs continue to escalate. A large part of the problem stems from our ineffective system for rewarding physicians: we pay for volume rather than value. In other words, we pay doctors for performing more procedures, not for making people healthier. What if we tried another approach and rewarded doctors differently? That's what Cigna has been doing since 2008 when we implemented our first collaborative accountable care program with Dartmouth-Hitchcock in New Hampshire. (FierceHealthPayer, February 21, 2012)

How ObamaCare Is Already Failing
ACOs are federally chartered health-care providers which, we're told, will help doctors and hospitals better coordinate care to improve the health of Medicare patients and reduce costs. According to ObamaCare's supporters, ACOs will streamline communication among doctors and thereby result in more effective care for patients. Providers will be paid not according to the number of procedures they perform, but according to the quality of care they deliver. So doctors and hospitals will have a strong incentive not to repeat tests or perform procedures that don't improve patients' health. (NY Post, February 21, 2012)

ACOs Need 'More' Than an EMR
There's no way around it: Accountable Care Organizations, or ACOs, are the future of healthcare in the United States, and providers had better get on the bus sooner rather than later. Attendees at the ACO Symposium at HIMSS12 appeared to recognize this, as Monday's pre-conference event was standing room only. Antonio Linares, MD, medical director at Wellpoint, reassured the audience that "unlike most things you encounter in Las Vegas, there is a win-win relationship for all those involved with ACOs." (Healthcare IT News, February 20, 2012)

Accountable Care Organizations and Collective Farms
Proponents of the Affordable Care Act (ObamaCare) claim that doctors in the US spend four times more, interacting with the many health plans, than Canadian physicians spend interacting with the government. In 2009, physicians in Ontario spent $22,205 on administrative costs per physician per year, while US physicians spent a staggering $82,975 each trying to get insurance companies to pay them. U.S. nursing staff, including medical assistants, spent 20.6 hours per physician, per week, interacting with health plans, nearly 10 times that of their Ontario counterparts. Many health policy makers conclude that a centralized system would be more efficient. But would that be better for patients? (Journal Express, February 20 2012)

Accountable Care Organizations and Primary Care
Everyone seems to be talking about Accountable Care Organizations - ACOs. From New York to Los Angeles, the new regulations developed in the Affordable Care Act of 2010 have become a much-debated and thoroughly studied topic. According to the federal government, implementation of Accountable Care Organizations and the PCMH (Patient-Centered Medical Home) will streamline health care, improve quality and efficiency, and make medicine more affordable for Americans. (studentdoctor.net, February 15, 2012)

Atrius CEO Interview: Inside a Pioneer ACO
FierceHealthcare caught up with Gene Lindsey (pictured), President and CEO of Atrius Health and its largest affiliate, Harvard Medical Associates, about what the process was like in becoming one of the first Medicare ACO Pioneers, especially in a competitive state like Massachusetts, and how the physician-led organization plans on standing out. (Fierce Healthcare, February 24, 2012)

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CMS/CMMI Panel Discussion and Q&A

Jonathan Blum
Director, Center for Medicare Management, Centers for Medicare and Medicaid Services, Baltimore, MD

Mai Pham, MD
Director, Innovations Center, Centers for Medicare and Medicaid Services, Washington, DC

Tom Williams, Dr PH, MBA
Executive Director, Integrated Healthcare Association, Oakland, CA (Moderator)