ACO Update: Trends, Results and the Future of Accountable Care
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1 ACO Update: Trends, Results and the Future of Accountable Care David Muhlestein, PhD Director of Research, Leavitt Partners September 16, 2014 Presentation Overview Basics of Accountable Care ACO Trends Early Results ACOs and Dentistry The Future of Accountable Care 1
2 Accountable Care Basics What is Accountable Care? Improve the individual experience of care Improve population health Reduce the cost of health care for populations Outcomes Oversee the provision of clinical care Coordinate the provision of care across the continuum of health services Invest in and learn to use appropriate IT to manage population health Processes Bear financial risk for the measured health of a population Align incentives to encourage the production of high quality health outcomes Structure 2
3 Managed Care vs Accountable Care MCOs ACOs Leadership Insurer-led Primarily financial arrangement Payment and provision of care separate Provider-led Physicians responsible Payment and provision of care aligned Aims Technology Cost-focused Goals and endpoint measured in dollars Limited Technology Little systematic sharing of data Difficult to collect and analyze big data Triple Aim Improved patient experience Higher quality Lower cost Advanced Technology EMRs, HIE Data gathering/analytics Accountable Care Trends 3
4 Where are they forming? Estimated ACO Penetration by State, Leavitt Partners Center for Accountable Care Intelligence, 2014 Market Growth by HRR Estimated ACO Penetration by Hospital Referral Region, Leavitt Partners Center for Accountable Care Intelligence,
5 Lives Covered by State Estimated ACO Penetration by State, Leavitt Partners Center for Accountable Care Intelligence, 2014 Lives Covered by HRR Estimated ACO Penetration by Hospital Referral Region, Leavitt Partners Center for Accountable Care Intelligence,
6 Overall Trajectory #of ACOs /1/19001/2/19001/3/19001/4/19001/5/19001/6/19001/7/19001/8/19001/9/19001/10/1900 1/11/1900 1/12/1900 1/13/1900 1/14/1900 Leavitt Partners Center for Accountable Care Intelligence 2014 Trajectory by Sponsor Type #of ACOs /1/19001/2/19001/3/19001/4/19001/5/19001/6/19001/7/19001/8/19001/9/19001/10/1900 1/11/1900 1/12/1900 1/13/1900 1/14/1900 Series1 Series2 Series3 Series4 Leavitt Partners Center for Accountable Care Intelligence
7 Accountable Care Lives Covered Lives Over Time Lives Leavitt Partners Center for Accountable Care Intelligence 2014 ACO Sponsoring Entities Other Organizations Physician Groups Hospital System Insurers 7
8 Public vs. Private Participation Leavitt Partners Center for Accountable Care Intelligence 2014 Public Program ACOs Leavitt Partners Center for Accountable Care Intelligence
9 State Government Pilot/Exploring ACO Program Passed ACO Legislation Active ACO Program Leavitt Partners Center for Accountable Care Intelligence 2014 ACO Taxonomy Types Full Spectrum Integrated All services are provided directly by the ACO. May include one or multiple organizations Independent Physician Group A single organization that directly provides outpatient care Physician Group Alliance Multiple organizations that directly provide outpatient care Expanded Physician Group Directly provides outpatient care and contracts for inpatient care Independent Hospital A single organization that directly provides inpatient care Hospital Alliance Multiple organizations with at least one that directly provides inpatient care 9
10 Pioneer ACO Program Source: Center for Medicare & Medicaid Innovation Medicare Shared Savings Program 4 th Round 3 rd Round 2 nd Round 1st Round Source: Center for Medicare & Medicaid Innovation 10
11 Early Results Early ACO Results ¼ shared in savings Average savings of $4.8M MSSP PIONEER 40% of pioneer ACOs saved CMS saved $33M ACOs received $76M Medicaid Commercial Very little information on results Few results released 11
12 Program Savings: MSSP vs Pioneer MSSP 2012 Total Savings: $254 million Pioneer 2012 Total Savings: $110 million Spending Impact Differences Pioneer MSSP R1 MSSP R2 % Change % Change % Change Institutional Outpatient -2.4% 0.51% 1.4% Part B Physician/Supplier -0.9% -12.8% 4.5% Inpatient -1.5% -10.5% 1.1% Skilled Nursing Facility 1.3% -23.5% -17.8% Home Health 1.9% 1.2% 2.1% Hospice -0.5% % Durable Medical Equipment 0.2% -9.9% 1.0% Total -2.4% -0.62% 0.6% 12
13 Dentistry and ACOs Early Examples of Dentistry Involvement 13
14 Dental Services Provided by ACO or ACO s Contracted Partner Page <#> 100% Percent of Contracts 90% 80% 70% 60% 50% 40% 30% 20% 40% 45% 17% 78% 33% 33% 10% 0% 0% Overall Full Spectrum Independent Physician Group Physician Group Alliance Expanded Physician Group Independent Hospital Hospital Alliance 2014 Leavitt Partners Source: Leavitt Partners survey n=45 ACOs Dental Health Included in Total Cost of Care for ACO Contract Page <#> 100% 90% 80% Percent of Contracts 70% 60% 50% 40% 30% 20% 10% 0% 12% 11% 0% Overall Full Spectrum Independent Physician Group 8% Physician Group Alliance 20% 18% Expanded Physician Group Independent Hospital 7% Hospital Alliance 2014 Leavitt Partners Source: Leavitt Partners survey n=45 ACOs and 93 contracts 14
15 Why Not More Experimentation? Not a major cost driver Paid for separately Dental care is outside mainstream medicine Tendency to provide dental care according to frequency or cost limits rather than health risk Medicaid May Serve as Laboratory States w/ Medicaid Adult Dental Coverage % of Total Lives in ACO Medicaid ACO Legislation/Pilot Medicaid Expansion OR 23.9% x x RI 11.7% x AK 11.5% IA 9.7% x x NY 7.9% x x OH 7.4% x WI 7.4% x* CT 6.6% x x NC 5.7% x NM 4.1% x ND 0.6% *State funded expansion not utilizing enhanced federal match dollars 15
16 The Future ACOs and Dentistry in the Future 1. Dental Care is a Point of Care Vaccines/Immunizations Diagnostics Dental Care 2. Dentists Have Line of Sight Medication use Patient behaviors Chronic Disease 3. Timing, Proactivity, Creativity are Critical 16
17 The Future of Accountable Care 1. Continued movement toward providers bearing risk 2. Different models in different regions 3. Pace of change is slow, but the ultimate destination is being decided now A health care intelligence business LeavittPartners.com 17
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