Learning What It Takes to Form Successful Accountable Care Organizations

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1 Session: Medicare ACOs: What s Needed to Make Them Work? Learning What It Takes to Form Successful Accountable Care Organizations Insight from Premier s PACT (Partnership for Care Transformation) Collaboratives Eugene A. Kroch, PhD Premier Research Institute June 25, 2012

2 The Bridge from FFS to Accountable Care Current FFS System What are the underpinning building blocks? Accountable Care Accountable Care Core Components People Centered Foundation Health Home High Value Network Population Health Data Management ACO Leadership Payor Partnerships Foundational Philosophy: Triple Aim Measurement 1

3 Key Concepts Environment that created the need for ACOs ACO goals and requirements for success Core capabilities common to ACOs Models, structures, payment options etc. Examples of accountable care Market segments where ACOs can operate Medicare, employee plans, self-funded employers, private plans, Medicaid, uninsured, individuals (non-group) Levels of Maturity Early challenges and policy Implications 2

4 Collaborative Members As of 09/09/11 WA WI MN SD ND MT ID OR MA VT NH ME NJ DE MD IL WI NE SD WY ID UT NV MA RI CT VA WV PA MI OH IN NY IA CO AR MO KS NM SC NC VA WV GA AL MS KY DC MO OK TN CA AZ LA GA AL MS TX FL 3

5 Collaborative Members As of 10/05/2011 WA MN ND MT OR VT NH ME NJ DE MD IL WI IA NE SD WY CO ID UT NV MA RI CT WV PA NH MI OH IN DC NY MD AR MO KS CO NM AZ CA SC NC VA WV GA AL MS TN KY MO OK LA FL GA AL MS TX 4

6 Assessing the State of Readiness Readiness assessments of 59 organizations during 2010/2011 What characteristics drive organizations to try this model? What is the state t of readiness? Are organizations generally further ahead in certain capabilities? What characteristics are associated with being further ahead or further behind? Description of qualitative trends like physician relationships and market dynamics. Other key lessons. 5

7 Quantitative and Qualitative Assessment Quantitative Assessment For each of the six components: Spider chart of assessment results Drivers for ACO development on top priority operating activities for Readiness to negotiate ACO contract with a payer ACO impact on the Triple Aim objectives Brief summary of Readiness Assessment scoring results Attachment Assessment Scores Qualitative Assessment A summary of key findings from a set of key open ended questions asked of a C-level representative (CEO, COO, CMO, CNO, etc), assessing their: Market Environment Organization Readiness Strategic Commitment Clinical Integration 6

8 The Capabilities Framework 7

9 Components and Capabilities 6 Components 42 Capabilities 154 Operating Activities Health Home - 7 A. Deliver People Centered Primary Care B. Optimize Chronic, Acute and Preventative Care C. Manage Population Segments to Optimize Health Status D. Coordinate Care Across Continuum E. Health Home Value Care Systems F. Drive Continuous Improvement in Practice Population Outcomes G. Develop New Care Models to Improve Specific Clinical Conditions Across the Spectrum of Care People Centered Foundation - 5 A. Involve People in Decisions that Affect their Health Care B. Provide People with Easy Access to Health Care C. Activate Individuals to Take Responsibility for their Own Health D. Regularly Assess and Address Individuals' and Population's Needs E. Measure and Improve the Experience of People within the ACO Population Population Health Data Management - 3 A. Capture and Analyze Data from Multiple Sources B. Applications and Systems that Enable Population Health Management C. Information Exchanges and Communication Pathways for ACO Patients & Participants High Value Network - 7 A. Deliver High Value Specialist Care B. Deliver High Value Outpatient Facility Services C. Deliver High Value Inpatient Services D. Deliver High Value Post-Acute Care E. Integrate and Coordinate Care Across the Spectrum F. Drive Continuous Improvement in ACO Population Outcomes G. Develop New Care Models to Improve Specific Clinical Conditions Across the Spectrum of Care Payor Partnership - 3 A. Negotiate and Manage ACO Contract with Payer Partners B. Design aligning incentive systems for ACO members that may be administered by Payer Partner C. Collaborate with Payer Partners to Manage Population Experience ACO Leadership - 17 A. Use Reimbursement to Align ACO Participants with ACO Objectives B. Provide ACO Wide Results Reports to all Participants C. Communicate Consistently and Routinely to all Participants D. Provide Strategic Management of ACO Entity E. Manage ACO as a Combined Physician Hospital Entity F. Provide Centralized Medical Management Functions G. Report on and Facilitate Management of Total Medical Cost H. Manage Intra-ACO Transfer Prices / Costs I. Manage Financial Performance of ACO J. Oversee Triple Aim Outcomes for Entire Population K. Effectively Manage the Opeartional Transitions Required to Create an ACO L. Develop an Organizational Culture Consistent with an ACO System M. Train Physicians and Other Leaders in Leadership Development in Order to Foster Effective Leadership in a New ACO System N. Enable ACO Contracting O. Evaluate, Analyze, Establish Appropriate Legal Structure P. Educate and Appropriately Manage Interactions Across and Between ACO Parties Q. Impact and Monitor ACO Regulatory and Legislative Environment

10 Capabilities Framework Scoring System ACO Component Capability Operating Activity Status Weight Total Score Per "Operational Activity" Total Score Per Capability Percent of Implementation per Capability Health Home Patient Registries Health Home Health Home B. Optimize Chronic, Acute and Preventative Care Reminder System Evidence Based Best Practices System % Health Home Dynamic Reporting Systems Health Home Disease Management System Status of Capability 0 = applicable to 0% of services for the intended ACO population 1 = applicable to 1-5% of services for the intended d ACO population 2 = applicable to 6 20% of services for the intended ACO population 3 = applicable to 21 50% of services for the intended ACO population or a successful demonstration / pilot on less than < 21% that is easily scalable across the health system 4 = applicable to > 50 % of services for the intended ACO population or Standard Operating Procedure (SOP) for entire health system 9

11 Capabilities Framework: Status and Weight Methodology 10

12 Overall Assessment by Component** Patient Centered Foundation 100% 80% Payor Partnership 60% 40% 20% 0% Health Home ACO Leadership High Value Network Population Health Data Management Blue = Top Decile Green = Median Red = Bottom Decile **Data from 59 assessments 11

13 Distribution of Weighted Component Score and Overall Score A weighted score of 0.25 corresponds to an average score of 1 out of 4 on the Likert scale for operating activities in each component 12

14 Variation Among Organizations with High Component Scores Organization (in order of high to low overall weighted score) Weighted Component Scores PCF HH HVN PHDM ACOL PP Overall Score Organization Scoring well in Organization one component does not always Organization translate to Organization readiness in all Organization components Organization Organization Organization Organization Blue indicates higher scores Red indicates Organization lower scores 13

15 Top 5 and Bottom 5 Summary Readiness Collaborative Overall Assessment Payor Partnership Patient Centered Foundation 100% 80% 60% 40% 20% 0% Health Home ACO Leadership High Value Network Population Health Data Managemen t Blue = Top 5 Red = Bottom 5 14

16 Top 5 and Bottom 5 Lessons from Comparisons Factors That Differentiate Organizations with High ACO Readiness 1. Ownership of a health plan with population health management capabilities 2. Existing collaboration with other health systems in the community 3. Positive relationships with primary care and specialty care providers in the market 4. More advanced level of clinical integration across the continuum of care 5. Some investment in patient centered medical home development with their PCPs 6. Existingrisk risk based basedcontracts with payersincluding bundled payments Factors That Do NOT Differentiate 1. Already in active execution of a clinical integration strategy across the system 2. Number of employed physicians 3. Disproportion of the market with government financed health services 4. Financial strength (strong for the entire group) 5. Medicare spending level, including end of life care 6. Market share Factors Likely to Become Differentiators in More Mature Models 1. Active governance structures that include physician leadership (e.g. PHOs) 2. An EHR and HIE implementation strategy across the continuum of care 3. Physician leadership development programs or culture barriers 4. Payers that are initiating innovative risk based relationships 15

17 Collaborative Learning Summary (thus far) Managing populations, not just patients, requires fundamental change within most healthcare systems Fundamental transformation will be clinical, with financial and legal changes to support clinical change Physician leadership is pivotal and significant culture shifts need to occur within organizations Care models to define evidence-based standards of care delivery and coordination across the continuum of care are critical building blocks to an ACO Executive leadership within C-Suite and Board are vital Keys to success include a primary care foundation, plus strong informatics and IT Variability of models is a given flexibility and innovation is market driven Shared learning collaborative is both a motivator t and supportive structure t Private payor readiness to alter reimbursement and share data to support ACO model varies widely Unknowns are plentiful public l and private sector have a lot to learn to effectively transform health care 16

18 The Team Eugene Kroch Blair Childs Danielle Lloyd Lynne Rothney-Kozlak Joe Damore Seth Edwards Amanda Forster Marla Kugel Diane Shannon Parker Marsh 17

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