Development of ACO Resources & Networks Practice Advancement Division

2 “It goes back to an old Buddhist concept, ‘The best fence is a good pasture’.” - Dr. Elliott Fisher

3 3 Core Principles of ACOs 1.Provider-led organizations with a strong base of primary care that are collectively accountable for quality and total per capita costs across the full continuum of care for a population of patients; 2.Payments linked to quality improvements that also reduce overall costs; and, 3.Reliable and progressively more sophisticated performance measurement, to support improvement and provide confidence that savings are achieved through improvements in care.

4 ACO adoption trends Since the passage of the PPACA in 2010 there have been at least 425+ ACOs recognized. The Medicare Shared Savings Program accounts for the largest share of ACO contracts. o 27 announced on ( ) o 89 announced on ( ) o 106 announced on ( ) Roughly ACOs operate completely in contract with private payers and are perhaps, not structured to participate in any current Medicare ACO contract model.

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7 Is transformation possible? The ACO is not a payment reform model – it is a framework for realigning incentives for all stakeholders in the delivery process. Move away from a system defined by an incentive for maximizing The ACO transformation is not a straightforward process – it is a holistic transformation which has roots in: improving clinical and administrative processes altering the organizational culture of providers and administrators Creating fundamental behavior change among patients/consumers the value of health care services the volume of health care services

8 What accountability looks like… for you (?) Fully integrated health records at the point of care to support clinical decision making. Adherence to clinical care guidelines established by the ACO. Transparency in terms of utilization and quality outcomes between fellow providers and administrators. Clinical functions & responsibility across the entire team and not entirely concentrated on the PCP. Developing a new population health perspective.

9 What accountability looks like… for practices Practice (PCMH) transformation is an absolute requirement. Extremely high functional competency in the use of EHR/HIT systems to facilitate transparency, reporting, and incorporation of external data elements in the clinical-process. This is a holistic implementation – it is unfeasible to try to segregate your patients based on which are participating in the ACO plans vs. non-ACO plans. Development of new workflows for both clinicians and administrative staff.

10 What accountability looks like… for industry A means to shift financial risk onto clinicians and clinical organizations. A strategy to either secure their local market leadership or as a means to better compete with a larger, more established market leader. An opportunity to foster collaboration across previously adversarial relationships to completely redraw the competitive landscape.

11 What accountability looks like… for patients It reduces the very real frustrations of navigating of a discontinuous, disconnected fragmented health care system. Removes barriers for patients to access health care services. Direct engagement in their own health care – at all levels. Providing patients with the information and data they need to be active participants in their own care.

12 In short… If successful adoption of the PCMH model means right care, right time, right place… … than the ACO model means that clinicians, patients, and administrators can access the right information, at the right time, at the right place – every time... … in order to best achieve the triple aims.

13 Basic organizational competencies for success I.Align incentives across all participating stakeholders. II.Leveraging technology to facilitate accountability. III.Top-tier business operations. IV.Promoting continuous care integration and quality management.

14 I. Aligning Incentives Aligning both financial and cultural incentives. Determining the most appropriate mechanism to distribute shared savings or to allocate losses to clinicians and practices. Establish a collaborative business environment between primary care physicians, specialists, and other health care organizations. Establish a strategy to engage and empower clinicians and staff across the ACO. Establish a strategy to engage, empower, and educate patients and their families.

15 Point of care clinical decision making support functionality. Comprehensive population-based registry functionality. System interoperability. Automated data collection, aggregation, and dissemination to all appropriate stakeholders. Establish the guidelines for what data elements will be collected from practice settings and how this will take place. II. HIT Infrastructure

16 1)Business Development: Establish governance structures Provider engagement, acquisition, and retention strategies Physician feedback and reporting systems Patient engagement, acquisition, and retention strategies Market plan development Payer engagement & contracting III. Business Operations

17 2)Human Resources: Compensation design Performance evaluation Accountability reporting processes Training programs Neutral conflict resolution and counseling services III. Business Operations

18 3)Accounting: Financial book keeping Payroll Expense management Accounts payable management Accounts receivable management III. Business Operations

19 4)Physician Payment & Revenue Management: Charge capture Claims processing Follow-up (3 rd party) and collections (self-pay) Managing adjustments Conduct fee analysis Managing denials/appeals III. Business Operations

20 5)Operations: Ensure standardization of patient facing processes between care settings Manage physical facilities Manage/coordinate supply chain processes for all ACO settings III. Business Operations

21 IV. Care Integration What is Care Integration? Care integration is the capability of the providers across an ACO to: jointly plan how care can best be provided; Standardize work flow processes across care settings; and develop methods for tracking and measuring the quality and cost of care.

22 IV. Care Integration Developing work flows integrating shared medical records for each patient at the point of care to support clinical decision making. Promoting full provider-to-provider care coordination. Ensure that the needs of the patients are managed at the most appropriate point of care. Provide capabilities to conduct population management at the practice level. Horizontal- vs. vertical-integration models.

23 IV. Care Integration Critical Questions for Clinicians: How will the EBG-based guidelines be created? Will participating primary care physicians have a voice in this process? Who will be responsible for insuring the functionality of the HIT necessary for achieving this level of care integration? How much autonomy will physicians related to those care guidelines? What quality and efficiency metrics will the physicians be measured against?

24 IV. Care Integration Outcomes Provide a mechanism to reward physicians to collaborate in order to assist other ACO stakeholders to improve operational efficiency through standardization and quality improvement. Provide incentives to ensure that patients receive care at the most appropriate site of care without fear of lost revenue at more expensive care settings. Re-aligning the incentives of all participant stakeholders: patients, hospitals, physicians, and administrators.

25 Alignment Challenges The most important function of an ACO is to engender collaboration and alignment between primary care practices and other health care settings. This is not a simple function – there are inherent structural barriers to alignment between health care stakeholder groups. Autonomy vs. Control Trust Cultural Process and Operations Sharing revenue streams

26 Alignment Challenges The most important function of an ACO is to engender collaboration and alignment between primary care practices and other health care settings. This is not a simple function – there are inherent structural barriers to alignment between health care stakeholder groups. Autonomy vs. Control Trust Cultural Process and Operations Sharing revenue streams

27 Questions, Concerns, Comments? Feel free to contact me any time. Joe Grundy, MBA | Delivery Systems Strategist American Academy of Family Physicians Office ext