A model for integrating independent physicians into accountable care organizations

The Affordable Care Act encourages the formation of accountable care organizations as a new part of Medicare. Pending forthcoming federal regulations, though, it is unclear precisely how these ACOs will be structured. Although large integrated care systems that directly employ physicians may be most likely to evolve into ACOs, few such integrated systems exist in the United States. This paper demonstrates how Advocate Physician Partners in Illinois could serve as a model for a new kind of accountable care organization, by demonstrating how to organize physicians into partnerships with hospitals to improve care, cut costs, and be held accountable for the results. The partnership has signed its first commercial ACO contract effective January 1, 2011, with the largest insurer in Illinois, Blue Cross Blue Shield. Other commercial contracts are expected to follow. In a health care system still dominated by small, independent physician practices, this may constitute a more viable way to push the broader health care system toward accountable care.     

The challenges ahead for accountable care organizations (ACOs)

Although offering financial incentives to both physicians and healthcare organizations, accountable care organizations (ACOs) are designed to not only offer quality patient care, but keep costs down as well. The law states that an ACO must manage all of the healthcare needs for a minimum of 3 years for at least 5000 Medicare beneficiaries. In January 2012, the first round of applications for the ACO Shared Savings Program were accepted. Practices and insurers have already begun setting up and announcing plans to create ACOs. By making providers equally responsible for their respective patients while giving financial incentives to avoid unnecessary procedures, ACOs aim to raise the quality of patient care. However, there are growing questions and concerns with the start date approaching. For instance, will the insurers, doctors, or hospitals be in charge? What are the legal concerns? How will patient care change? To listen to the full panel discussion visit: http://www.ajmc.com/panel-discussions/accountable-care-organizations.     

Unveiling the unicorn: a leader's guide to ACO preparation

The great uncertainty surrounding healthcare reform provides little incentive for action. However, as healthcare leaders wait for final rules and clarity about accountable care organizations (ACOs), inaction is the inappropriate response. Several central themes emerge from research about beginning the ACO process. Leaders should be able to understand and articulate ACO concepts. They should champion embracing cultural change while partnering with physicians. Inventory of skills and capabilities should take place to understand any deficiencies required to implement an ACO. Finally, a plan should be formed by asking strategic questions on each platform needed to ensure performance and strategic goals are at the forefront of decisions regarding structure and function of an ACO. It takes a visionary leader to accept these challenges.     

An agent-based simulation model to study accountable care organizations

Creating accountable care organizations (ACOs) has been widely discussed as a strategy to control rapidly rising healthcare costs and improve quality of care; however, building an effective ACO is a complex process involving multiple stakeholders (payers, providers, patients) with their own interests. Also, implementation of an ACO is costly in terms of time and money. Immature design could cause safety hazards. Therefore, there is a need for analytical model-based decision-support tools that can predict the outcomes of different strategies to facilitate ACO design and implementation. In this study, an agent-based simulation model was developed to study ACOs that considers payers, healthcare providers, and patients as agents under the shared saving payment model of care for congestive heart failure (CHF), one of the most expensive causes of sometimes preventable hospitalizations. The agent-based simulation model has identified the critical determinants for the payment model design that can motivate provider behavior changes to achieve maximum financial and quality outcomes of an ACO. The results show nonlinear provider behavior change patterns corresponding to changes in payment model designs. The outcomes vary by providers with different quality or financial priorities, and are most sensitive to the cost-effectiveness of CHF interventions that an ACO implements. This study demonstrates an increasingly important method to construct a healthcare system analytics model that can help inform health policy and healthcare management decisions. The study also points out that the likely success of an ACO is interdependent with payment model design, provider characteristics, and cost and effectiveness of healthcare interventions.     

Modeling and designing health care payment innovations for medical imaging

Payment innovations that better align incentives in health care are a promising approach to reduce health care costs and improve quality of care. Designing effective payment systems, however, is challenging due to the complexity of the health care system with its many stakeholders and their often conflicting objectives. There is a lack of mathematical models that can comprehensively capture and efficiently analyze the complex, multi-level interactions and thereby predict the effect of new payment systems on stakeholder decisions and system-wide outcomes. To address the need for multi-level health care models, we apply multiscale decision theory (MSDT) and build upon its recent advances. In this paper, we specifically study the Medicare Shared Savings Program (MSSP) for Accountable Care Organizations (ACOs) and determine how this incentive program affects computed tomography (CT) use, and how it could be redesigned to minimize unnecessary CT scans. The model captures the multi-level interactions, decisions and outcomes for the key stakeholders, i.e., the payer, ACO, hospital, primary care physicians, radiologists and patients. Their interdependent decisions are analyzed game theoretically, and equilibrium solutions - which represent stakeholders’ normative decision responses - are derived. Our results provide decision-making insights for the payer on how to improve MSSP, for ACOs on how to distribute MSSP incentives among their members, and for hospitals on whether to invest in new CT imaging systems.     

Salary and Quality Compensation for Physician Practices Participating in Accountable Care Organizations

BACKGROUNDThe accountable care organization (ACO) is a new organizational form to manage patients across the continuum of care. There are numerous questions about how ACOs should be optimally structured, including compensation arrangements with primary care physicians.METHODSUsing data from a national survey of physician practices, we compared primary care physicians’ compensation between practices in ACOs and practices that varied in their financial risk for primary care costs using 3 groups: practices not participating in a Medicare ACO and with no substantial risk for primary care costs; practices not participating in an ACO but with substantial risk for primary care costs; and practices participating in an ACO regardless of their risk for primary care costs. We measured physicians’ compensation as the percentage of compensation based on salary, productivity, clinical quality or patient experience, and other factors. Regression models estimated physician compensation as a function of ACO participation and risk for primary care costs while controlling for other practice characteristics.RESULTSPhysicians in ACO and non-ACO practices with no substantial risk for costs on average received nearly one-half of their compensation from salary, slightly less from productivity, and about 5% from quality and other factors. Physicians not in ACOs but with substantial risk for primary care costs received two-thirds of their compensation from salary, nearly one-third from productivity, and slightly more than 1% from quality and other factors. Participation in ACOs was associated with significantly higher physician compensation for quality; however, participation was not significantly associated with compensation from salary, whereas financial risk was associated with much greater compensation from salary.CONCLUSIONAlthough practices in ACOs provide higher compensation for quality, compared with practices at large, they provide a similar mix of compensation based on productivity and salary. Incentives for ACOs may not be sufficiently strong to encourage practices to change physician compensation policies for better patient experience, improved population health, and lower per capita costs.     

The promise and peril of accountable care for vulnerable populations: a framework for overcoming obstacles

Accountable care organizations (ACOs) are a promising payment model aimed at reducing costs while also improving the quality of care. However, there is a risk that vulnerable populations may not be fully incorporated into this new model. We define two distinct vulnerable populations, clinically at-risk and socially disadvantaged, and we discuss how ACOs may benefit each group. We provide a framework to use in considering challenges for both vulnerable patients and health systems on the path to accountable care. We identify policies that can help overcome these obstacles: strategies that support ACO formation in diverse settings and that monitor, measure, and reward the performance of providers that reach all patients, including vulnerable populations.     

The ACO paradox impacting physicians

Accountable care organizations (ACOs) would hold care providers jointly accountable for the quality and costs of care, allow consumers the freedom to choose their providers, and involve physicians and consumers in their shared decision-making. Even though the ACO model proposes physician empowerment, it also poses significant financial and change-management challenges for physicians. Furthermore, the "patient-centered" ACOs that have been established to safeguard consumer sovereignty pose the risks of concentrating healthcare markets further and exacerbating the existing disparities in healthcare. We conducted a survey study to understand physicians' perspectives of ACOs by seeking their first-hand feedback. The survey results suggest that there are significant communication gaps between physicians and healthcare administrators; and efficient communication can help improve physician-administrator alignment and help them identify opportunities that would be critical to the success of ACOs.     

Accountable Care Organizations: roles and opportunities for hospitals

Federal health reform has established Medicare Accountable Care Organizations (ACOs) as a new program, and some states and private payers have been independently developing ACO pilot projects. The objective is to hold provider groups accountable for the quality and cost of care to a population. The financial models for providers generally build off of shared savings between the payers and providers or some type of global payment that includes the possibility of partial or full capitation. For ACOs to achieve the same outcomes with lower costs or, better yet, improved outcomes with the same or lower costs, the delivery system will need to become more oriented toward primary care and care coordination than is currently the case. Providers of clinical services, in order to be more effective, efficient, and coordinated, will need to be supported by a variety of shared services, such as off-hours care, easy access to specialties, and information exchanges. These services can be organized by an ACO as a medical neighborhood or community. Hospitals, because they have a management structure, history of developing programs and services, and accessibility 24/7/365, are logical leaders of this enhancement of health care delivery for populations and other providers.     

Eight reasons payer interoperability and data sharing are essential in ACOs. Interoperability standards could be a prerequisite to measuring care

It makes strategic and business sense for payers and providers to collaborate on how to take substantial cost out of the healthcare delivery system. Acting independently, neither medical groups, hospitals nor health plans have the optimal mix of resources and incentives to significantly reduce costs. Payers have core assets such as marketing, claims data, claims processing, reimbursement systems and capital. It would be cost prohibitive for all but the largest providers to develop these capabilities in order to compete directly with insurers. Likewise, medical groups and hospitals are positioned to foster financial interdependence among providers and coordinate the continuum of patient illnesses and care settings. Payers and providers should commit to reasonable clinical and cost goals, and share resources to minimize expenses and financial risks. It is in the interest of payers to work closely with providers on risk-management strategies because insurers need synergy with ACOs to remain cost competitive. It is in the interest of ACOs to work collaboratively with payers early on to develop reasonable and effective performance benchmarks. Hence, it is essential to have payer interoperability and data sharing integrated in an ACO model.     

Accountable Care Organizations in the Era of Healthcare Reform

Under the Patient Protection and Affordable Care Act (PPACA) of 2010, Medicare providers, including physician groups and hospitals, will soon have the option to form accountable care organizations (ACOs) to improve quality and efficiency. ACO participants may share financial gains generated from improved clinical and economic performance, provided that quality goals and patient safeguards are met. Through future regulations, the Centers for Medicare & Medicaid Services (CMS) must implement the ACO option no later than January 1, 2012. In this interview, Dr Mark B. McClellan, former CMS Administrator and US Food and Drug Administration Commissioner, discusses the extraordinary implications of the new ACO option for improving patient care and reducing unnecessary costs.Kip Piper, MA, FACHE: You and your colleagues were influential in developing the ACO concept1 and successfully persuading Congress to make ACOs an option in Medicare. Are you surprised by the tremendous interest in ACOs since enactment of the PPACA this year?Mark B. McClellan, MD, PhD: There has been a real expansion of interest in ACOs recently, and some of that is not surprising. The key ideas behind accountable care have been around for a while. CMS has implemented some Medicare demonstration programs previously that potentially use ACO concepts, and a number of private payers and providers have been working on ACO implementation as well. I have been a bit surprised by the breadth of interest. It is a reflection of how seriously providers and payers are taking the healthcare reform law.However, unlike many of the other provisions on payment reform, ACOs will be a real part of Medicare as of 2012, if not earlier; not a pilot, not a demo, but a part of the Medicare program. That may be contributing to the interest too. And finally, there is growing interest in making sure that payment policies fit together to add up to getting better value, getting higher quality, and avoiding unnecessary costs. That''s contributing to the interest in ACOs. It is a confluence of factors, and in retrospect I should not be so surprised by the intense interest in the ACO model.Piper: What are some of the factors critical to successfully implementing an ACO?McClellan: One is a critical mass of providers who are willing and able to meaningfully take accountability for the well-being of a population of patients. This includes a primary care network and other types of healthcare providers, maybe even some providers who are involved in things that are not traditionally thought of as healthcare, such as wellness programs and population health management. But the key thing is that there is a critical mass of providers who are willing to work together and are able to take meaningful steps to get to better health for those beneficiaries.Second, there also is a need for a critical mass of payers. There needs to be enough reform in the way payments work so that steps that traditionally do not make much financial sense—such as promoting better coordination of care, taking steps to reduce complications and readmissions, and exchanging information effectively—make more financial sense. And that takes enough of the payer community to get behind the effort as well.Having both providers and payers simultaneously jump together is a challenge, but there is certainly a growing number of examples of ways to do it successfully. In the end, the success of ACOs is going to depend on actually reforming care so that costs are lower and results are better. It''s not just a matter of getting the critical mass (of providers and payers), but actually having meaningful steps that can be taken. These steps can take a little time, and certainly some effort, to reform the way healthcare works, which requires a commitment of time, effort, and expertise to meaningfully redesign care.Piper: How does the ACO model fit in context with other major reforms, most notably bundled payment, global and episode-based payment reforms, and the medical home model?McClellan: There is a tendency now to look at what is in the healthcare reform legislation and what is being tried in the private sector and states around the country as basically throwing a lot of spaghetti against the wall and seeing what sticks. That is the wrong way to look at these reforms. They all have a common goal of improving care delivery, making it better so that patients are healthier, and making it more efficient so that costs are lower. The best strategy for an organization is to view these as part of an overall approach to getting that result. So, for example, it can actually be easier to implement an ACO successfully by pairing it with a medical home reform.We are seeing many examples of this around the country, where the providers get the support they need for coordinating care and spending more time on patient management by the upfront investment needed to support a meaningful medical home. Payers get some accountability that, by taking these steps (or as they take these steps upfront to support reforms and care delivery), they are going to be able to see what the ultimate consequences are for health and for costs on the back end. That is what an ACO provides. So these reforms can truly reinforce each other. The best way to approach payment reform is as pieces that add up to a more comprehensive and effective whole.Piper: Long-term, which form of payment do you expect will work most effectively with the ACO model—shared fee-for-service savings, partial capitation, or some other form of global payment?McClellan: What we have seen in some early adopters is movement toward having less payment depend on fee for service. But that is not necessarily going to be the outcome. I can imagine some longer-term arrangements where ACOs are operating at a regional level or across a diverse range of providers, where fee-for-service reimbursement may remain a substantial part of payment. The main thing is that ACOs involve setting up a different kind of tracking system for payments than you get with fee for service.In the most basic form of ACOs, with shared savings, in addition to tracking the volume and intensity of services for traditional fee-for-service payments, the organization and its payers will also track some meaningful results for the population of patients being served and per-capita spending. If there are any savings compared with fee-for-service costs, those provide an additional source of reimbursement for the providers.As people get more used to thinking about things that they can do to improve care and to work on improving those patient-focused performance measures rather than just the fee-for-service billing, you can imagine more weight going to this patient-focused payment approach, and it can be gradual. In some examples, it may start out with shared savings. Then, as the providers get more used to working together in this kind of explicit goal-oriented way, as they identify some further steps that they can take together to improve performance, and as they get more comfortable with an explicit patient-level focus, you can imagine putting more weight on the ACO payment model as opposed to fee for service.So maybe reducing the fee-for-service payment by 20% across the board or for primary care services and putting that money into a partial capitation fund would enable the organization to do more to reform care than it can with the resources from shared savings alone. Different organizations may come out in various places. The whole point is to try to support incremental steps that are not too disruptive in the short-term, but that over time could lead to more fundamental improvements and care.Piper: A few skeptics question the readiness of provider organizations in areas such as governance, physician relationships, coordination, health information technology (HIT), and performance measurement. How do you respond?McClellan: Yes, this is hard, especially in the status quo, where it is very difficult for many healthcare providers and provider organizations. Their payment rates are being squeezed. They are facing new reimbursement and regulatory pressures because of rising healthcare costs. Unfortunately, I do not see the status quo getting better. So although this is a real challenge, there are some unique opportunities to support the move toward a different kind of payment, in which providers get better support for delivering better care, not just more squeezes. It makes now a really good time to consider moving forward on addressing these very hard challenges.For example, there is the federal HIT initiative, with Medicare and Medicaid incentive payments for adoption of electronic health record (EHR) systems and meaningful use of EHRs. The objectives of the meaningful use standards are tied directly to improving patient care. This sounds a lot like the goal of accountable care. There are some payments now and over the next few years in Medicare for physicians and other healthcare providers for reporting on performance. That is easier to do if you have an information system in place and if you are actually developing and using information systems to improve care.CMS now has 2 tracks for performance reporting. One is the traditional “fill out another claim form” approach, which is burdensome on providers and does not help improve quality. The other is to submit information from systems used to improve care at the patient level as a registry-based submission to CMS. An increasing number of provider organizations are doing that.There are also other opportunities in terms of medical homes and other payment reforms that can collectively add up to a significant amount of support for addressing things such as governance, effective information technology (IT) use, and improving physician relationships and coordination. But those opportunities are not going to be around forever. I think the next few years are probably the best time to take advantage of all of this support for building up systems that help providers do what they want to do, which is get better results for their patients at a lower cost.Piper: ACOs have been discussed mostly in terms of hospitals and physicians. Does the ACO model hold promise for other combinations of healthcare providers?McClellan: Yes, it does. It is essential to have a network of primary care physicians within an ACO. But there are certainly a lot of opportunities to expand broadly beyond specialist hospitals and other types of traditional healthcare providers. For example, we have heard from a number of communities that already have public health initiatives in place. They want to expand these initiatives to use wellness programs and school-based programs to support ACO goals.State Medicaid programs are finding that if they can expand the support from ACOs and Medicaid to areas like community-based mental health services, they can document some significant reductions in medical costs related to mental illnesses. There are issues that could be addressed through support of care in the community but that are not part of traditional healthcare delivery. I think ACOs actually make it easier to move toward less-traditional forms of delivering care and toward preventing complications and keeping people well. That''s because all these steps in the absence of an ACO run the risk of payer concerns that they may just lead to higher costs and more expenditures. Therefore, some reluctance. With the accountability of the ACO model, it becomes easier to bring in other types of providers, other types of services that may not even be traditional healthcare to get the better results and lower costs.Piper: The Engelberg Center for Health Care Reform, at the Brookings Institution, provides practical solutions to achieve high-quality, innovative, affordable healthcare. What else is the Engelberg Center working on?McClellan: Well, this is sort of high noon for healthcare reform implementation. A lot of people think that the big issues are not coming until 2014, but implementation of reform is under way now. And so we are not only trying to help with effective implementation around accountable care, quality and value, and healthcare payments, but also on other issues, such as evaluating other types of payment reform and other things that may not be viewed as within the traditional reform but probably should be.For example, we are doing work with a network of health plans and EHR systems on developing a better surveillance capability in this country for monitoring the safety of medical products. We have got an IT infrastructure now, incomplete as it is, that could provide much more timely information on potential safety problems. So we need to take steps to use that.Of course, healthcare reform is never done. So we are following up on some of our earlier work on bending the curve in healthcare, with ideas that may be considered in the next round of healthcare reform. The President has a commission on deficit reduction that will report later this year. In 2011, unquestionably there will be more healthcare legislation related to implementation of the new law, funding it, and perhaps building on it. So we are trying to provide some useful guidance for all of that too.What a lot of these projects have in common is a recognition that private sector leadership is needed for real reform in healthcare, and for making our public-private system work better, but that this needs to be aligned with effective federal, state, and local government policies to support shared goals. And one of the things we have tried to do here at the Engelberg Center—as a neutral, expert-oriented think tank—is to help bring together these different perspectives in practical ways to make progress on the big challenges of reform in all of these areas.     

Accountable Care Organizations: Roles and Opportunities for Hospitals

Abstract

Federal health reform has established Medicare Accountable Care Organizations (ACOs) as a new program, and some states and private payers have been independently developing ACO pilot projects. The objective is to hold provider groups accountable for the quality and cost of care to a population. The financial models for providers generally build off of shared savings between the payers and providers or some type of global payment that includes the possibility of partial or full capitation. For ACOs to achieve the same outcomes with lower costs or, better yet, improved outcomes with the same or lower costs, the delivery system will need to become more oriented toward primary care and care coordination than is currently the case. Providers of clinical services, in order to be more effective, efficient, and coordinated, will need to be supported by a variety of shared services, such as off-hours care, easy access to specialties, and information exchanges. These services can be organized by an ACO as a medical neighborhood or community. Hospitals, because they have a management structure, history of developing programs and services, and accessibility 24/7/365, are logical leaders of this enhancement of health care delivery for populations and other providers.     

Analysis & commentary: The accountable care organization: whatever its growing pains, the concept is too vitally important to fail

The success of health reform efforts will depend, in part, on creating new and better ways to organize, deliver, and pay for health care. Increasingly central to this idea is the accountable care organization model proposed for Medicare and a slightly different model for commercial health care. But these new health care delivery and payment models face considerable skepticism. Can Medicare succeed with accountable care organizations if physicians can't determine whether patients are in the organization or not? Will commercial hospitals use their clout to create accountable care organizations, leaving physician practices in a weaker position? This article answers those and other criticisms of the developing accountable care organization movement. If the concept fails, the nation may face indiscriminate cuts to health care payments, with resulting reductions in access, service, and quality.     

ACOs: Forging the links

Hospital executives see building accountable care organizations as the key to better managing patient care across the continuum and preparing for bundled payments. This ACO primer looks at the big issues hospitals face, from regulatory concerns to governance. The No. 1 step to success is building stronger relationships with physicians.     

The March to Accountable Care Organizations—How Will Rural Fare?

Purpose: This article describes a strategy for rural providers, communities, and policy makers to support or establish accountable care organizations (ACOs). Methods: ACOs represent a new health care delivery and provider payment system designed to improve clinical quality and control costs. The Patient Protection and Affordable Care Act (ACA) makes contracts with ACOs a permanent option under Medicare. This article explores ACA implications, using the literature to describe successful integrated health care organizations that will likely become the first ACOs. Previous research studying rural managed care organizations found rural success stories that can inform the ACO discussion. Findings: Preconditions for success as ACOs include enrolling a minimum number of patients to manage financial risk and implementing medical care policies and programs to improve quality. Rural managed care organizations succeeded because of care management experience, nonprofit status, and strong local leadership focused on improving the health of the population served. Conclusions: Rural provider participation in ACOs will require collaboration among rural providers and with larger, often urban, health care systems. Rural providers should strengthen their negotiation capacities by developing rural provider networks, understanding large health system motivations, and adopting best practices in clinical management. Rural communities should generate programs that motivate their populations to achieve and maintain optimum health status. Policy makers should develop rural‐relevant ACO‐performance measures and provide necessary technical assistance to rural providers and organizations.     

Accountable care organizations: a primer

Accountable care organizations (ACOs) are being hailed as a promising element of health care reform, as some believe they will be critical to improving the quality of care and holding down costs. Several state and federal ACO demonstration projects are scheduled to begin in the near future. Yet, questions abound as to what exactly an ACO is and how they work. This article describes the concept, outlines challenges to implementing ACOs, and discusses concerns about this new care delivery and payment model.     

Legal Mechanisms Supporting Accountable Care Principles

Public health and private providers and facilities may shape the future of the US health system by engaging in new ways to deliver care to patients.“Accountable care” contracts allow private health care and public health providers and facilities to collaboratively serve defined populations. Accountable care frameworks emphasize health care quality and cost savings, among other goals.In this article, I explore the legal context for accountable care, including the mechanisms by which providers, facilities, and public health coordinate activities, avoid inefficiencies, and improve health outcomes. I highlight ongoing evaluations of the impact of accountable care on public health outcomes.As the US health system undergoes transformation, public health departments are engaging in new ways to deliver health care with private entities. One such method is “accountable care,” the coordinated provision of patient services by health care and public health providers and facilities with the goals of improving outcomes and avoiding inefficiencies.1 The core tenets of accountable care are prevention, health care quality, patient satisfaction for the population served, and cost savings to the health care system.1 Accountable care frameworks are based on risk and reward, with providers and facilities agreeing to collectively share the financial risk for a population in return for the opportunity to access rewards for attaining preestablished health care goals.Entities that seek to engage in accountable care are formed according to legal principles governing businesses and contracts, but federal and state laws2 specifically incentivize the formation and success of these entities by establishing antitrust waivers, fraud and abuse protections, and mandates to coordinate care. Although much has been written on the legal basis for establishing accountable care entities, with this article, I seek to inform public health practitioners of the relationship between the laws that recognize accountable care principles and the public health goals of improving patient care, impacting quality and outcomes, and measuring population health.In this article, I discuss 3 mechanisms by which providers, facilities, and public health may contract together to maintain legal entities that implement accountable care principles. First, health care providers and payers have pursued private contracts to provide accountable care to improve outcomes in their patient populations.3 Second, the Centers for Medicare and Medicaid Services authorizes Medicare reimbursements for legal entities certified as accountable care organizations (ACOs) through traditional fee-for-service and other payments upon meeting benchmark cost and quality standards.4 Third, state laws incorporate accountable care mechanisms into Medicaid provisions, permitting state programs to reimburse accountable care entities that serve vulnerable populations.5 Finally, I offer suggestions for evaluating the impacts of accountable care on public health outcomes.     

Designing Vermont's pay-for-population health system

Vermont is developing a health care system that could offer a unique opportunity to test a new model for improving population health. Four lines of development converged for the system: 1) a published challenge to create a pay-for-population health system, 2) comprehensive state health reform legislation, 3) the Institute for Healthcare Improvement Triple Aim project, and 4) the concept of the accountable care organization (ACO). In phase 1 of pilot testing, 3 communities serving 10% of the population are using the system, which is based on the enhanced medical home model. Planning is under way for phase 2 of the pilot, ACOs that use incentives based on the Triple Aim goals. Vermont has created a conceptual framework for a community health system and identified some of the practical issues involved in implementing this framework. This article summarizes the design and implementation of the enhanced medical home pilots and the results of a feasibility study for the ACO pilots. It describes how one state is using a systematic approach to health care reform to overcome some of the implementation barriers to a pay-for-population health system. Vermont will continue to provide a statewide laboratory for a pay-for-population health system.     

Topics Product Profile

When it was introduced in the Affordable Care Act of 2010 as the new 2012 payment model for Medicare, an accountable care organization (ACO) was a new and untested concept in healthcare delivery and payment. The authors estimated the likelihood of engagement in ACOs by small group and solo healthcare practitioners. An evaluation of five case studies showed that significant organizational, financial, and technological challenges had to be met in order to launch an ACO. Sufficient resources to meet those challenges were best supplied by large organizations. Small or solo practices participated only through varying levels of integration as salaried physicians or in independent practice associations or physician hospital organizations.