SEPTEMBER 18, 2012

Welcome to the Accountable Care Update eNewsletter
Editor: Philip L. Ronning
This issue is sponsored by the ACO Congress

Study Shows Many ACOs Physician-Led; Risk Challenges Remain
According to a Commonwealth Fund study, physician-led accountable care organizations (ACOs) are driving the healthcare delivery system toward a greater focus on prevention, primary care, and coordination, but creating the infrastructure to manage the inherent financial risk is formidable. The study also reported that only 13% of hospitals are participating or plan to participate in ACOs. The study's chief author, Anne-Marie Audet, believes that delivery models are changing the paradigm, with more primary care, longitudinal care, and population management. (Health Policy Insider, August 18, 2012)

ACOs - Promise, Not Panacea
In an important Journal of the American Medical Association (JAMA) editorial, former CMS Administrator Donald Berwick reiterates his support of the ACO experiment as a model environment in which to nurture the "better forms and habits" we know will work. Healthcare suffered harsh criticism in the Institute of Medicine's 2001 report Crossing the Quality Chasm, which concluded, "In its current form, habits and environment, American healthcare is incapable of providing the public with the quality care it expects and deserves." Berwick elaborates on how the ACO model can serve as a bridge between the status quo and a more effective future. (JAMA, September 12, 2012)

Top 25 Diagnoses for Pioneer ACOs
According to Stratasan and published by Jarrard Phillips Cate and Hancock, the 15,245,067 admissions for the first 32 Pioneer Accountable Care Organizations were broken down as follows:
  1. Supplementary classifications -- 2,150,629
  2. Disease of the circulatory system -- 1,271,469
  3. Females with deliveries -- 947,421
  4. Heart disease -- 816,933
  5. Disease of the digestive system -- 811,833
  6. Diseases of the respiratory system -- 797,652
  7. Injury and poisoning -- 689,136
  8. Disease of the musculoskeletal system and connective tissue -- 510,330
  9. Disease of the genitourinary system -- 457,144
  10. Mental disorders -- 454,974
  11. Endocrine, nutritional and metabolic disease and immunity disorders -- 421,046
  12. Neoplasms -- 391,270
  1. Psychoses -- 323,919
  2. Malignant neoplasms -- 301,355
  3. Infectious and parasitic diseases -- 262,760
  4. Pneumonia -- 253,413
  5. Fractures, all site -- 244, 254
  6. Disease of the nervous system and sense organs -- 228,021
  7. Congestive heart failure -- 223,144
  8. Certain complications of surgical and medical care -- 216,035
  9. Osteoarthritis and allied disorders -- 215,351
  10. Cerebrovascular disease -- 202,253
  11. Disease of the skin and subcutaneous tissue -- 177,758
  12. Cardiac dsyrhythmias -- 164,243
  13. Coronary atherosclerosis -- 157,930
Additional information can be found at http://jarrardinc.com/Pilot-ACO-HSD.pdf. (Becker's Hospital Review, September 10, 2012)

CMS Details Integrated Care Model Expectations in Letters to Medicaid Directors
The Centers for Medicare and Medicaid Services (CMS) recently detailed for Medicaid Directors its expectations of "integrated care models" such as accountable care organizations (ACOs), including how options can be pursued by states without resorting to waivers. CMS advises using plan amendments for applying new models to all Medicaid beneficiaries and providers, suggesting a primary care focus and the shared savings approach or similar options to encourage quality improvements and cost reductions. CMS noted that 1115 demonstration waivers will be needed to target populations or limit benefits, however. (Inside Health Policy, August 28, 2012)

States Join Medicaid ACO Movement
Another five states are set to join with Colorado, Minnesota, Oregon, New Jersey and Utah in developing Medicaid accountable care organizations (ACOs) over the next six months. Access to reliable data will be a determining factor in the success of these efforts. "In order for ACOs to reach their true potential, all organizations involved must become highly integrated communications machines," said Christine Severin, CEO of Network Health in a recent interview. (FierceHealthcare, September 14, 2012)

The California Pilot that Could Prove ACOs Work
Austin Frakt, an economist, conducted a study with UC-Berkeley researcher Rick Mayer to evaluate how capitation lessons have informed ACO development. In a partnership with CalPERS, the state's employment agency and Blue Shield of California, savings of about $37 million were achieved through an ACO relationship with Dignity Health and Hill Physicians Medical Group serving CalPERS beneficiaries in the Sacramento area. [Review this study entitled "Beyond Capitation: How New Payment Experiments Seek to Find the 'Sweet Spot' In Amount of Risk Providers and Payers Bear" at http://content.healthaffairs.org/content/31/9/1951.full. Related and valuable research can be found in "The Design and Application of Shared Savings Programs: Lessons from Early Adopters" found at http://content.healthaffairs.org/content/31/9/1959.full. (California Healthline, September 12, 2012)

The Cloud as a Health Data Nexus for ACO
Arguably the goal of accountable care is to connect providers to allow them to offer preventive, evidence-based medicine that achieves the best clinical outcomes possible, but connectivity and interoperability problems seem to make this goal unattainable in spite of the best efforts of HIEs (health information exchanges). This article suggests that cloud-based services provide answers that go beyond simply integrating unrelated information systems. Simply put, cloud-based connectivity transcends the limitations of disparate data sources. "By allowing all the organizations that make up the healthcare ecosystem to transcend their traditional boundaries, the cloud can offer an efficient information nexus for the ACO." (Government Health IT, September 4, 2012)

5 Steps to Solid Infrastructure for ACO Goals
This article outlines five steps an organization should take prior to developing an ACO. These steps are: 1) determine organizational readiness, 2) assess the personnel infrastructure, 3) analyze the technology infrastructure, 4) evaluate care delivery processes with a focus on care coordination, and 5) formulate a communication plan for the cultural shift. (Healthcare Finance News, August 29, 2012)

Accountable Care Strategies: Lessons from the Premier Health Care Alliance's Accountable Care Collaborative

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Getting Payment Strategies to Work: The Critical Physician Nexus

Alice G. Gosfield, Esq.
Alice G. Gosfield and Associates, PC, Philadelphia, PA