Although the company has only a partial year of Medicare claims to go by, Coleman says the data look “pretty good” so far and suggest the ACO is on track for modest savings of perhaps 3% or 4%. Like BIDPO, Banner has other shared-risk agreements in place, including one for a Medicare Advantage population and another with a private payor. So far, Coleman says, those arrangements also seem to be “performing positively.”
Dr. Greeno and other experts see the best ACO results coming from such rapidly growing private arrangements, and early published data have been generally encouraging.1 The ability to more narrowly define patient groups and assume more control over payments, he says, has allowed private ACOs to keep better track of costs and implement innovative population health interventions.
This is actually moving faster than I thought—faster than I think anybody thought.
—Ron Greeno, MD, FCCP, MHM, SHM Public Policy Committee chair
Built to Last?
Whether public, private, or a hybrid between the two, some ACOs are trying to manage the care of their entire patient pool and look at everything that might help them accrue cost savings. Others are focusing only on the sickest patients to reach their quality improvement (QI) and savings goals, and targeting specific parameters, such as blood pressure or medication adherence, for patients with myocardial infarction.
Joane Goodroe, an Atlanta-based healthcare consultant, favors the latter approach, at least for new ACOs. Goodroe recommends adopting a streamlined strategy that will get an ACO up and running, then allow the group to gradually add to it, rather than waiting until all of the right pieces fall into place. Her own data analysis of Medicare patients, for example, suggests that a diabetic who’s been an inpatient can average $50,000 in yearly costs, compared with $2,400 for a diabetic who has never been admitted to a hospital.
Setting up a system to manage every diabetic patient from the start, she says, would require too much time and money. “If you try to build the perfect ACO structure, it’s going to be too expensive for the results you initially get back,” she says, making it seem like the ACO is an unsustainable failure. “You’ve got to figure out how to build a cost-effective infrastructure while you’re also improving the care of the patients, and the best place to go is to target your sickest patients first.”
CMS’ Advance Payment ACO Model is designed to help by providing upfront payments to smaller ACO organizations that might lack capital, giving them an advance on potential shared savings so they can install the infrastructure and support structures necessary to redesign care.
To maximize the overall chances of success, Dr. Parker says, ACO leadership should be fully engaged, and each organization should have enough resources to address its own care management and information technology needs. “My goal as medical director is to improve the quality of care of the patients and, hopefully, also improve the working life of the doctors and staff,” he says. “And my belief and expectation is that if we do that, the cost of care will ultimately go down.”
Bryn Nelson is a freelance medical writer in Seattle.