Monthly Archives: April 2016

Nine Notes from NAACOS16


Post by Scott McLeod


Director of Product Marketing, Caradigm

I was recently at the Spring Conference of the National Association of ACOs (NAACOS) in Baltimore, and attended nearly a dozen sessions. Given the continued challenges many accountable care organizations (ACOs) have had in achieving shared savings, the biannual NAACOS events are excellent opportunities to hear from leading ACOs from around the country. In listening to the speakers as well as conversing with other attendees, I came away with nine key observations.

1) Difficulty: ACOs in general, are working hard to be successful, but that success is hard to come by. Comments I heard confirmed the statistic that only about a quarter of ACOs achieved shared savings. Due to this difficulty, there appears to be an increased appetite for tools that can increase the likelihood of success.

2) Uncertainty: There remains a great deal of uncertainty about value-based care—even among the winners. I spoke with a physician from one of the most successful Medicare Shared Savings Program (MSSP) ACOs, but he admitted that to some degree, they “didn’t know how they did it.”  This uncertainty affects decisions to continue in programs or engage in new ones, and also affects IT investment decisions. Providers must weigh the size of any IT investment against the possible return.

3) Benchmarking: As any shared savings are based on the comparison of actual utilization against the Centers for Medicare and Medicaid Services (CMS) established benchmark, there is strong interest in the methodologies CMS uses to establish the benchmark, e.g. historical v. regional fees, and the process for “rebasing” those benchmarks over time.  There is also interest in analytics solutions that can help (1) determine whether or not to participate in a specific program based on the benchmark, and (2) help manage their network of providers against the benchmarks for programs in which they participate.

4) What’s Next:  Organizations are considering participation in CMS’ Next-Generation ACO (NGACO) program.  While it provides some advantages for home health, telemedicine and skilled-nursing facility (SNF) waivers, it also comes with two-sided risk (i.e. greater potential upside but the addition of downside risk). Given the difficulty and uncertainty noted above, organizations are proceeding very cautiously and trying to garner as much information as possible before deciding.

5) Bundled Antipathy:  There is a level of antipathy among ACOs for awardees in BPCI (Bundled Payment for Care Improvement).  This antipathy results from the fact that CMS does not want to double-count (and double-credit) savings realized. Any savings realized for beneficiaries that qualify for bundled-payment services are credited to the BPCI entity and deducted from the potential shared savings of the ACO.  This is true even if the beneficiary is a member of the ACO. There is some feeling of unfairness as the ACO is responsible for a beneficiary’s utilization over the entire year while the BPCI entity only has to manage utilization during the length of the episode of care.

6) Variability of PAC: Whether for bundled payments or MSSP, several presenters called out the wide range of costs in post-acute care, and cited it as a big opportunity for cost management. This recent Wall Street Journal article also discusses the same issue of variability of costs.

7) Survival of the Fittest: While providing quality care to patients is always central to a provider’s mission, competing within their market is also on their minds. Strategies and initiatives adopted are business decisions that include the goal of capturing market share from competitors.

8) Diversification: The advice to the audience from a panel of large, mostly successful ACOs was to nurture other sources of revenue until the hoped-for shared savings were realized. This includes continuation of fee-for-service (FFS) business, participation in the episode-based BPCI, etc.  There was evidence of one-off agreements with large employers for a specific bundle or set of services.  As the industry makes its shift to value-based reimbursement, I expect we’ll see lots of different activities (though headed in the same direction) rather than a unified strategy.

9) Patient Care vs. Population Health:  Although ACOs are participating in a variety of value-based initiatives, the language of presenters and participants tended to focus on the quality care of patients more than managing the health of populations.  This may be a reflection that many of the speakers were physicians, but it seems that there remains a mindset around individuals rather than populations.

As fast as healthcare has been evolving recently, I look forward to tracking these and other trends over the course of the year. I hope to circle back to them during the Fall 2016 NAACOS event to see if they have changed.

Population Health and “The Wire”


Post by David Lee


Product Marketing Manager, Caradigm

NPR recently published this in-depth article about the challenges of healthcare for Baltimore’s lower income residents. After reading it, it’s hard for me not to think of The Wire, the HBO series that received acclaim for its authentic portrayal of Baltimore’s deep rooted social challenges. I think healthcare is another issue that David Simon, the show’s creator, could have explored as the core premise of the series is the interconnected nature of the city’s struggles – poverty, crime, policing, race relations, politics and the education system. There is a quote from a character on the show that has become emblematic of this theme that also applies to how healthcare has been recently shifting to population health:

“All the pieces matter.” — Detective Lester Freamon to Detective Roland Pryzbylewski, The Wire

Dr. Marcia Cort, chief medical officer of the non-profit Total Health Care, states in the article that “Baltimore City is in a health crisis.” The life expectancy of residents in the impoverished Sandtown neighborhood is 69.7 years old, which is the same as in poverty-stricken North Korea. Also according to the article, “residents of the ZIP code including Sandtown accounted for the city’s second-highest per-capita rate of diabetes-related hospital cases in 2011, the second-highest rate of psychiatric cases, the sixth-highest rate of heart and circulatory cases and the second-highest rate of injury and poisoning cases. Asthma, HIV infection and drug use are common.”[1]

Over the years, some residents have developed a mistrust of healthcare due to challenges in access and because of negative outcomes experienced resulting from a lack of coordinated and preventive care. A Baltimore resident, Robert Peace, described how he developed a recurring bone infection after undergoing a surgical procedure. Likely due to receiving minimal follow-up care, the infection grew worse, became extremely painful and resulted in five additional surgeries being required in 18 months. Today, Robert has permanently impaired mobility.

Dr. Jay Perman, pediatric gastroenterologist and president of the University of Maryland, Baltimore stated in the article that clinicians have to accept responsibility for patients outside the walls of the hospital. “As a profession, as an industry, we have not sufficiently appreciated, let alone done something about, the impact of social determinants. Guys like me and gals like me can easily say, ‘I made the correct diagnosis. I wrote a proper prescription. I’m done.’ What I say to my students is, if you think you’re done — if ‘done’ means the patient is going to get better — you’re fooling yourself.” To the credit of health systems in the area, they acknowledge that there have been shortcomings in how care was delivered and are implementing improvements. These efforts include a new focus on preventing readmissions, new investment in care coordinators, primary care and post-discharge management.

Although the social challenges Baltimore faces have been ingrained for many years, healthcare is the one for which there may be the clearest path to lasting improvement – via population health. Population health as an approach recognizes that health systems must care for patients outside the walls of the hospital using a multi-disciplinary team. An expanded care team can include friends, family members and social organizations (e.g. assistance with transportation, meals, paying for prescriptions, etc.). It can involve multiple health systems collaborating in the care of patients even though the health systems are in reality competitors. It also recognizes the need for innovation in technology such as a longitudinal patient record shared across all providers, analytics, and workflow tools that can help care teams manage a high volume of patients efficiently.

I would theorize that more than any other factor, it was the shortcomings of the fee-for-service model that contributed the most to the poor outcomes experienced by Sandtown residents. Population health offers a real strategy for change. More than cost efficiency, which is often the most commonly mentioned driver of population health, improved outcomes is the most compelling reason for population health. I am hopeful that health systems like those in Baltimore will continue to invest more and scale their population health initiatives with a sense of urgency. If they can successfully transform to become more patient-centric and improve the health of the people they serve, they will be able to rebuild the trust of the community. That accomplishment would be truly worthy of a television series.

[1] Hancock, Jay. In Freddie Gray’s Baltimore, The Best Medical Care Is Nearby But Elusive. NPR.org, 2.15.16. originally published at http://www.npr.org/sections/health-shots/2016/02/15/466550095/in-freddie-grays-baltimore-the-best-medical-care-is-nearby-but-elusive