Accountable Care in 2014

Transcription

1 Accountable Care in 2014 Four Years Post ACA: How Will ACOs Evolve? Jane DuBose, Senior Director, Decision Resources Group Presentation to NAMCP, Fall Accountable Care Agenda ACO and value-based landscape ACO performance Physician control Looking ahead to the next generation of ACOs 2 1

2 : Landscape is changing Integrated delivery networks and advanced medical groups entering ACO market and taking more risk for quality incentive and outcomesbased rewards Medicare moving away from FFS model and experimenting with new options to manage beneficiaries Health plans and providers are merging to survive reimbursement cuts New types of partnerships between medical groups, managed care and hospitals are emerging 3 Landscape is evolving from transactions to value TRANSACTIONor SERVICE BASED VALUE BASED Visit Episode Test Disease Bed-Day Population R x Service Procedure 4 2

3 Performance contracts defined ACO a clinically integrated group of providers that accepts financial risk for the management of a patient population Clinically Integrated Network a group of clinicians who agree to a formal set of standards for diagnosing, treating and coordinating care for a patient population Share risk for clinical outcomes, as well as safety and adherence to evidence based care More than 840 separate ACO contracts are counted in fourth quarter 2014 involving patients insured by commercial, Medicaid and Medicare payers Source: CMS, Decision Resources Group 5 ACOs got their start in Physician Group Practice Demonstration Program from CMS begins 10 large multispecialty groups of ~5,000 physicians Partly used as the model for the Medicare ACOs BCBS of Mass begins Alternative Quality Contract with a global budget and financial incentives tied to quality outcomes Advocate Health Care & BCBS of Illinois announce shared savings contract in CMS launches Pioneer ACO program, selecting 32 provider led organizations for threeyear shared savings/shared risk contracts; by 2014, the list diminishes to 19 CMS names more than 300 provider organizations to three year contracts for shared savings on performance of 33 quality metrics and improving on financial benchmarks Sources: CMS, Decision Resources Group, BCBS of Illinois and Massachusetts 6 3

4 Calif., Fla., and Mass. are homes to highest number of ACOs WA MT ND ME OR ID WY SD MN WI MI NY VT NH MA CT RI CA NV UT CO NE KS IA MO IL IN OH KY WV PA VA NJ DE MD Number of ACOs 0 AZ NM OK AR TN SC NC HI TX LA MS AL GA FL >31 AK In Development Source: Decision Resources Group s ACO Database, as of October From a patient lives view, large states lead in this ACO metric WA MT ND ME OR ID WY SD MN WI MI NY VT NH MA CT RI CA NV UT AZ CO NM NE KS OK IA MO IL MS IN TN AL KY OH GA WV SC PA VA NC NJ DE MD Number of Patients <100, , , , ,999 HI TX LA 500, , ,000 1,000,000 AK FL >1,000,000 None or Unknown Source: Decision Resources Group s ACO Database, as of October

5 ACOs: Organization view # of ACOs by Type of Payer Medicare Medicaid Commercial 42.90% 5.90% 1.00% 50.20% Commercial Medicare Combination Not available ~ 340 Medicare Shared Savings Program 19 Pioneers, down from 32 in 2012 ~ 53 operating or in development in 11 states 426 performancebased or shared savings contracts between payers and provider groups N= 848 MSSPs must have 5,000 beneficiaries; Pioneers, 15,000 States have not set minimum patient requirements From ~ 5,000 to 100,000 covered lives in a single ACO Sources: Navigant HealthCare, ACO, 2.0, Decision Resources, CMS 9 ACOs: Payer view About Cigna s CCAs Cigna s Collaborative Care Agreements with physician groups are similar to ACOs Scope: 100 agreements, 27 states, 1 million commercial customers, 39,000 physicians (including 19,000 PCPs and 20,000 specialists) Approach 1. Sharing Useful Patient Information: sharing claims data with physicians 2. Predictive Modeling: identifying patients at risk for readmission to develop postdischarge care plans, including HHC and physician outreach 3. Embedded Care Coordinators: for the management of chronic conditions 4. Communication and Collaboration: internal meetings to improve care coordination and program management 5. Clinical Integration: alignment of case managers to physician groups and care coordinators 6. Aligning Incentives to Performance: pay for value reimbursement for achieving quality and affordability targets Metric CCAs Operational for 2+ Yrs. CCAs Operational for 1+ Yr. Results % Meeting Quality Targets 73% (2% better than mkt. average) 63% (2% better than mkt. average) % Meeting Medical Cost Targets 73% (3% better than mkt. average) 50% (at par with mkt. average) % Meeting Quality + Cost Targets 55% 37% Source:

6 Market ACO: Market view Level of organization of health system is a predictor of ACO contracting activity # of ACO Contracts Market Dynamic New York 34 Large population base; physician comfort with population health & risk; multiple payer led ACOs Boston 31 Consolidated IDN driven market with all major payers pursuing performance based contracts Chicago 28 Leading IDN (Advocate) and leading payer (BCBS) both driving accountable care Los Angeles 27 Large population base, organized physician groups comfortable with capitation Phoenix 19 Banner Health has more separate ACO partners than any other IDN in U.S. San Francisco 19 CalPERs, payers, hospitals & physicians all driving ACOs Pittsburgh 3 Dominance of 2 large systems has tamped down ACO activity Kansas City, Mo. 3 Largely unconsolidated market lately has been consolidating Charlotte, N.C. 6 Loosely organized physicians uninterested in patient risk 11 Source: DRG ACO database ACOs: Disease view Population health ACOs are responsible for the entire health spend (with the exception of Part D for Medicare) so the costliest diseases to manage have gotten the most attention. Current focus Medicare Shared Savings Plans and Pioneers are focused on managing the diseases for which there are quality metrics: diabetes, heart failure, and chronic diseases such as high blood pressure and dyslipidemia. Emerging focus ACOs are starting to form to address specific disease states or populations: Oncology Florida Blue and Baptist Health South Miami Pediatrics University Hospitals Pediatric ACO Cleveland Congestive heart failure Oakwood ACO Employees Detroit End stage renal disease under development by CMS From the field Source: DRG Research We have narrowed our focus to those (members) with two or more chronic conditions. As we saw more data, we learned that focusing on this population would do the most to make people healthier and, therefore, lower healthcare costs. Darrel Ng, communications, Anthem BCBS of California 12 6

7 Accountable Care Agenda ACO and value-based landscape ACO performance Physician control Looking ahead to the next generation of ACOs 13 First year results are underwhelming for MSSPs Financial view Of those operating in Year 1 (2012), only onefourth, or 50 of 223, achieved savings on their assigned beneficiaries Largest gain was $57.83 million from Memorial Hermann in Houston Other large savings came from Palm Beach ACO with $39.6 million, Catholic Medical Partners in NY with $27.9 million and Southeast Michigan ACO with $24.7 million Source: CMS, released September 2014 Domain Patient/caregiver experience 7 Care coordination/patient safety Preventive health 8 At-risk population/frail elderly health # of measures 6 12 Rules of the Road Details Surveys measuring physician and system performance CMS claims, NQF and AHRQ standards for COPD, asthma, CHF, medication reconciliation Screens (mammography, depression, etc.) using NQF and NCQA standards Management of diabetes, hypertension, heart disease using NCQA, NQF standards Medicare ACOs must meet the quality standards from above to be eligible for sharing in savings on their beneficiaries ACOs are judged financially on whether they best the benchmark, which is based on Parts A and B expenditures for the Medicare population had there been no ACO Each year, the ACO s per capita, risk adjusted Medicare expenses are compared to the updated benchmark 14 7

8 Pioneers also struggling depending on who you ask Year 1 total savings: $87.6 M Year 1 savings to ACOs: $76 M Year 2 total savings: $96.0 M Year 2 savings to ACOs: $68 M The (mostly) good news Altogether, MSSPs and Pioneers have recorded savings of $372 million so far Year 1 13 ACOs shared in savings Year 2 2 ACOs posted losses Year 2 11 ACOs shared in savings Year 2 3 ACOs posted losses The bad news Pioneers dropped out of the program after Year 1 results 2 completely, while 7 shifted to MSSP In 2014, another four dropped out Pioneers have more risk, transitioning to a shared risk and sharedloss model for the current performance year 19 Pioneers will operate in 2015 Sources: CMS, DRG Drop outs cited difficulty in realizing savings based on CMS benchmark methodology 15 Pioneers have improved quality scores Average quality score by domain Pioneers improved on 28 of 33 quality measures from Year 1 Quality Measure Domain Year 1 Year 2 to 2 Patient /caregiver experience 83% 86% Care Coordination/patient safety 61% 71% Preventive health 70% 80% At risk population 67.5% 83% The largest improvement was with the at risk population measures, which strike at the core of ACO success in managing chronic diseases. Of the 23 ACOs that remained in the program for Year 2, all but one improved its overall quality score Higher quality scores so far do not necessarily correlate to higher financial rewards One explanation is the higher quality ACOs tend to be in areas already relatively healthy, thus pushing down their potential for savings Source: front/posts/2014/10/09 pioneer aco results mcclellan#recent_rr/ 16 8

9 The largest commercial ACO seeing encouraging performance 4,000 physicians in BCBS of Illinois PPO network 1.4% reduction in inpatient admission rate 0.3% increase in inpatient days versus 4.7% for rest of hospitals in PPO network 2.5% overall lower costs for Advocate/BCBS of Ill. ACO versus rest of PPO Source: as of January Accountable Care Agenda ACO and value-based landscape ACO performance Physician control Looking ahead to the next generation of ACO 18 9

10 Nearly 30% of ACOs are physician controlled 848 ACOs Excludes hospital, payer-led ACOs Excludes non- Medicare ACOs Excludes Pioneer ACOs The vast majority of physiciancontrolled ACOs are Medicare Shared Savings Program (MSSP) types 165 are less than 2 years old Source: DRG ACO database, as of October are 2 or more years old 19 More than 100 ACOs are jointly guided by payers, physicians 848 ACOs Includes only physician/payer ACOs Includes only ACOs with no hospital organizer 95 Includes only those sharing in savings A small number are at global or shared risk Source: DRG ACO database, as of October

11 From large to small, ACO gains are difficult to come by Physician led ACO Location Boston Yuma, Ariz. Type Pioneer, commercial MSSP Founded # of physicians 1,000 in six independent medical groups First year Medicare performance ACO initiatives 12 listed on Web site $2.44 million loss Did not share in savings in Year 1 COPD program, reducing SNF costs, chronic kidney disease Sources: CMS, / Still in progress 21 How did physician led Pioneers perform versus system led? Performance in Year 2 Physician Led Health System Led 3 of 6 had savings Best: 5.4% and worst: 1.2% 8 of 14 had savings Best: 7% and worst: 5.6% N = with shared savings; 9 not and 3 not reporting Source: CMS 22 11

12 Even with mixed results of Pioneers, more on the way New round of Pioneers likely to be named for 2015 by CMS Yet some providers remain skeptical Organizations are not gravitating toward the Pioneer ACO model because the downside risk is not outweighed by the opportunity for economic gain the business case is not compelling. Dr. Richard Gilfillan, CEO of CHE Trinity in a comment letter to the CMS Providers concerned about potential for loss Want financial rewards to be larger Also suggest patients be able to choose their own ACO rather than be attributed through PCP Also concerns about the way benchmarks are used for computing financial gains or losses Source: 23 What is life like for physicians in an ACO? Rules of engagement (Nebraska example)* Financial incentives Adherence with ACO protocols (80% equals opportunity for bonus) Increased use of generic medications Decreased emergency department utilization Decreased out of network referrals Installation of EMR As little as 5% or as much as 20% are common amounts of compensation that are at risk for meeting ACO goals of efficiency, patient outcomes Most physicians are paid FFS with bonus reconciliation at the end of the year or year Minority of physicians in bundled payment or capitation systems ACO distinctions Some require physicians meet a portion of measures to get bonuses Others require so called quality gates be passed through One Pioneer ACO created a health risk assessment form for all assigned patients. Physicians receive $100 for each HRA filled out. Physicians are eligible for the first 20% of savings. * For Accountable Care Alliance in Omaha 24 Sources: DRG Research, 12

13 Accountable Care Agenda ACO and value-based landscape ACO performance Physician control Looking ahead to the next generation of ACOs 25 The cast of characters will expand Specialists Care Coordinators Pharmacists Data specialists ACOs have realized that they are unable to control spending without additional specialists aligned to the ACO Payers, hospital systems, even pharmaceutical companies are funding care coordinators at the PCP level Pharmacy schools and others are finding pharmacy resources to help with medication adherence ACOs need expertise to integrate data, manage data sets and use it to predict patient behaviours and outcomes 26 13

14 The types of quality measures will change Overall Medicare Commercial Medicaid More focus on outcomes rather than process New depression remission at 12 months New all-cause readmission metric Rate of admissions to skilled nursing facilities NCQA testing measure set with provider groups States are turning to ACOs and will develop their own measure sets 27 Payment systems will evolve Bundling Global risk Advanced payment Shared savings Single payment for treatment of diagnosis may expand into ACOs Pioneering contracts from Blue plans in Massachusetts and Illinois may spread CMS trying to encourage more ACOs with upfront payment CMS likely to change parameters to give MSSPs more chance for shared savings 28 14

15 Patient engagement will need to go to a higher level More complex patients Leveraging technology better End Stage Renal Disease Oncology Rare diseases Smart use of mobile tech Social networking Remote technology 29 Meanwhile, mergers will tilt more practices into organized models 120% 100% 80% 60% 40% 20% 0% 22% 28% 70% 70% 34% 43% 49% 55% 46% Hospital ownership Physician Ownership 41% Hospital owned practices more likely to be clinically integrated and/or involved in ACOs The capital necessary to develop an ACO and ramp up to staff better care coordination favors larger practices or integrated health systems Payers will continue to focus on value and not volume based reimbursement 30 15