What is the Health Plan’s Role in an ACO?
Can health plans drive the collaboration between physicians and other clinical stakeholders while maintaining a focus on the patient?
By Jay I. Pomerantz, MD – Executive Medical Director for Health Integrated
It seems that healthcare continues to make the headlines on many fronts and hence there are great topics to write about. I continue to be intrigued about healthcare reform and the direction it will take. Several weeks ago, I wrote about whether Accountable Care Organizations (ACOs) could deliver healthcare reform. In a recent blog post from National Journal.com[1], the question is asked, “ACOs: Who’s the Boss?” Interesting question since it implies who is in control. Since an ACO can be defined as a local healthcare organization and related group of providers that can be held accountable for the cost and quality of care delivered to a defined patient population[2], maybe the question is valid, but not in the sense of control, but more in the context of collaboration and direction in meeting a common goal. So the ACO in practice then will perform as we hope all of healthcare reform does – improve outcomes while reducing cost.Â
Makes sense.
It would seem that to be successful then, an ACO must be run by physicians yet have an unwavering focus on the patient. So far so good. The balance to be struck is to reduce unnecessary services without denying the necessary care to achieve optimum patient outcomes. Certainly well-crafted financial incentives (vs. fee-for-service) combined with clinical metrics could drive this focus and subsequent results. The collaboration between groups is crucial in order to gain this efficiency, yet it  might prove to be the most challenging. Most of the related articles recently seem to agree that the ACO still needs to be tested with multiple pilots, and then the best practices shared. The recently passed Patient Protection and Affordable Care Act has monies available as soon as 2012 to do just this.Â
With all of these challenges, it seems that the health plan can play the crucial role of facilitator. With all of the stakeholders engaged in one form or another with the health plan, the health plan has the potential to be the hub for the ACO should they adopt that role. In a comment on a blog I read recently, the author suggested that an ACO is just an “HMO on steroids”. If that is the case, the health plan is certainly at the center. Unlike the HMOs of the 1990s though, an effective ACO relies on the provider physicians to police and optimize their own work rather than the payors. In a recent article by Mr. Jamie Gooch in Managed Healthcare Executive, he believes the success of an ACO is dependent upon the partners that are engaged. He suggests starting small and working with strong partners that can advance the ‘better-care-at-lower-cost’ model. Using this crawl/walk/run scenario, partners can be selected, and the program can be clinically integrated to optimize the cooperation. Again, the health plan has the opportunity of adopting a leadership role and facilitating these relationships and subsequent outcomes to meet the overall goals of the ACO program. Â
Additionally, we have talked previously about the critical role of evidence-based medicine in the healthcare reform debate. If we have the information from which best practice can be established, documented and communicated, we all stand to benefit by delivering better healthcare to the patients with greater efficiency and at a lower cost. Again, the health plan can play a key role here. With their reach and access to aggregated clinical information, evidence-based data can be collected, analyzed and made available for the physician and associated clinical organizations to better administer care to the patient. Models that are continuously referenced include Geisinger[3], Mayo Clinic[4] and Intermountain Healthcare[5] – they have integrated care and have created very effective ACOs.
It seems universally acknowledged that ACOs may very well become a mainstay in our healthcare system as reforms continue. In recent paper about ACOs published by the Deloitte Center for Health Solutions[6], they suggest that the rapid adoption will still be challenged by four major factors:
- Physician buy-in: although major physician-based professional organizations support the ACO drive (AAFP, AAC, AMA), resistance may persist if strong business cases cannot be made
- Consumer response: in the new order, patient assignment to an ACO is likely, but patients are free to change physicians which may be outside of their ACO. This would suggest that some HMO-like restrictions may be exercised with populations like Medicaid in order to drive optimal outcomes – both financial and clinical
- Payments and incentives: there is no universally-agreed-upon payment structure, but if ACOs are to succeed, FFS models are not sustainable or consistent with an ACO-based environment
- Infrastructure to manage risk: the infrastructural support for EMR, monitoring compliance, contracting, collections, regulatory, etc., are not innate within provider organizations and thus need focus and support in order to be meet improved ACO goals
Health plans can play a role along with all of the other stakeholders assuming the patient remains the focus and broad-based collaboration the game plan.Â
What do you think?
As I mentioned in my email, Health Integrated is hosting their Fall Executive Leadership Series Event in Chicago on September 22 – 23. This post touches on one of the presentation topics. There will be a detailed session at the ELS where health plan executives can further discuss the ACO and its role within your health plan. I encourage your participation.  As well, I would look forward to meeting you there. Visit our website for more details.Â
Thanks for reading. Feel free to comment directly or send me your thoughts on this post as well as other topics that would interest you. You can reach me directly at healthexecforum@healthintegrated.com.  Â
Best Regards,
Jay I. Pomerantz, MD
[1] National Journal.com, http://healthcare.nationaljournal.com/2010/06/acos-whos-the-boss.php?comments=expandall#comments
[2] Robert Wood Johnson Foundation: http://rwjfblogs.typepad.com/healthreform/2010/03/health-reformers-lexicon-accountable-care-organization.html
[3] http://www.geisinger.org/professionals/consulting/services.html
[4] Wall Street Journal.com, http://online.wsj.com/article/NA_WSJ_PUB:SB10001424052748703436504574640711655886136.html
[5] US News & World Report, http://health.usnews.com/health-news/best-hospitals/articles/2010/07/26/the-hospital-your-care-coordinator.html
[6] Deloitte Center for Health Solutions, http://www.deloitte.com/assets/Dcom-UnitedStates/Local%20Assets/Documents/US_CHS_AccountableCareOrganizations_070610.pdf
The Health Plan must and should be at the center. They have ultimate fiduciary reponsibility to the ultimate payer- the employer.