The Road to Accountable Care: Building Systems for Population Health Management

This case study series describes how three diverse organizations are developing accountable care systems to improve the quality and reduce the costs of care, and ultimately improve the health of populations of patients insured by Medicare, Medicaid, and commercial health plans. They employ a constellation of strategies to identify and address unmet medical needs, improve care transitions, and reduce inefficiencies and unnecessary variation in care. Care managers, outreach workers, or virtual care teams help improve outcomes for patients with complex needs that are costly to treat. Data integration and analytics are key to their efforts, although the sophistication of these capabilities varies. Two study sites have established a record of savings, while the third is still proving the potential of its approach. Their progress to date suggests that payment reforms can foster the will and accountability necessary to transform care. BACKGROUND Creating a health care system that rewards providers for achieving optimal care outcomes at a sustainable cost is a key reform goal of the Affordable Care Act. Provisions in the law have allowed the federal government to test and implement several new payment models designed to achieve this goal for the Medicare program, many of them built on academic blueprints1 and prior demonstrations.2 Likewise, several states are redesigning their Medicaid programs in pursuit of accountable care,3 while commercial insurers are partnering with health care providers in various arrangements that similarly seek to reward value rather than volume of services.4 These efforts stem from a common recognition that payment reform is necessary to achieve the triple aim of improved care and healthier populations at reduced cost. The early experiences of organizations participating in public and private payment reform programs may offer insight for policymakers to gauge whether the programs are likely to achieve policy goals as well as how the programs may need to evolve to do so. Lessons learned also may help health care leaders decide whether to enter into such arrangements and, if so, how to increase the likelihood of success. This report synthesizes the findings of three case studies that describe how diverse delivery systems have responded to accountable care initiatives (Exhibit 1). 5 To learn more about new publications when they become available, visit the Fund’s website and register to receive email alerts. Commonwealth Fund pub. 1768 Vol. 21 The mission of The Commonwealth Fund is to promote a high performance health care system. The Fund carries out this mandate by supporting independent research on health care issues and making grants to improve health care practice and policy. Support for this research was provided by The Commonwealth Fund. The views presented here are those of the authors and not necessarily those of The Commonwealth Fund or its directors, officers, or staff. For more information about this brief, please contact: Douglas McCarthy, M.B.A. Senior Research Director The Commonwealth Fund DM@cmwf.org 2 The Commonwealth Fund These organizations (or their founders) were the subject of prior research by The Commonwealth Fund, which investigated the attributes of high-performing organized delivery systems.6 They were selected to illustrate a range of mature efforts, early successes, and ambitious aims for the accountable care model under different payment and local contexts. IMPETUS FOR ACO FORMATION AND DEVELOPMENT The study sites shared the same main motivation for forming accountable care organizations (ACOs): they all saw the model as a natural progression of long-standing efforts to enhance primary care services and a means for extending quality improvement and care management initiatives. Other motives were unique to each site. • The creation of Health Share of Oregon, a regional Medicaid coordinated care organization, was prompted by Oregon Governor John Kitzhaber’s vision for transforming health care in the midst of a Medicaid budget shortfall, which led the state to consolidate contracting regionally in pursuit of greater efficiency and community service integration. • The Hill Physicians Medical Group was motivated by market forces to partner with hospital and health plan partners to regain market share lost to Kaiser Permanente, an integrated delivery system that was underpricing its competitors. Meeting this challenge required the ACO partners to jointly reduce spending to bring Blue Shield’s premiums below Kaiser’s. • For the Marshfield Clinic, the Medicare Shared Savings Program offered a source of potential incremental revenue to support the continued evolution of mission-driven population health management for all its patients. These physician-led efforts had begun seven years earlier through the clinic’s participation in Medicare’s Physician Group Practice (PGP) demonstration, which tested the ACO concept. Exhibit 1. Case Study Sites Organization Location Type of organization ACO participation ACO population Health Share of Oregon* Greater Portland, Oregon Nonprofit collaboration of medical and dental health plans, county mental health agencies, and community and social service agencies Medicaid coordinated care organization 227,000 Medicaid beneficiaries residing in three Oregon counties Hill Physicians Medical Group Northern California Independent practice association (IPA) of 3,800 private-practice physicians serving 300,000 patients Several commercial ACOs, including a partnership with Dignity Health and Blue Shield of California in the Sacramento market 41,000 members of the California Public Employees’ Retirement System (CalPERS) in the Sacramento market Marshfield Clinic Central Wisconsin Nonprofit multispecialty medical group practice of 700 employed physicians serving 383,380 patients across 41 clinical sites Medicare Shared Savings Program (following participation in Medicare’s Physician Group Practice demonstration) 30,000 traditional (feefor-service) Medicare beneficiaries Note: ACO = accountable care organization. * CareOregon, a health plan that is one of Health Share’s founders, was the subject of a previous Commonwealth Fund case study. Source: Authors’ analysis. The Road to Accountable Care: Building Systems for Population Health Management 3 BUILDING A SYSTEM FOR POPULATION HEALTH MANAGEMENT The study sites adopted a variety of approaches and interventions to optimize care and identify opportunities to achieve performance and savings targets and goals. Exhibit 2 summarizes select examples from the study sites.10 Care redesign to improve the delivery and coordination of care. All three organizations are building on past efforts to redesign and strengthen primary care, which typically involved establishing the infrastructure and supports needed for physician practices to function as patient-centered medical homes. Another common area of focus was improving transitions in care from hospitals to postacute or community settings, and in one case from skilled nursing facilities to in-home care. For example, Hill Physicians Medical Group and its ACO partners aligned incentives to promote coordination across settings and worked collaboratively as a cross-continuum team to successfully reduce hospital readmissions. Health Share sought to ensure that all members seeking behavioral health services received the same level of care from mental health agencies in three different counties. It created a single provider network and streamlined the process for authorizing services and determining service levels to meet patient needs. This integration enhanced the ACO’s ability to measure and monitor the performance of the network. Care management of patients with costly, complex needs. All study sites have invested resources in deploying care managers, outreach workers, or virtual care teams to engage with and help improve outcomes for patients with complex needs or at risk of incurring high costs. All stress an individualized approach to identify and address unmet needs through in-person or telephone visits. For example, care teams that may include social workers as well as pharmacists and case managers have been deployed by urban safety-net clinics affiliated with Health Share and by Hill Physicians Medical Group to help address the psychosocial and clinical factors that play a role in improving patients’ health and treatment adherence. Marshfield Clinic embedded nurse care coordinators in all its primary care clinics to help patients avoid unnecessary hospital use, with the expectation that shared savings would help fund this infrastructure. It subsequently discontinued the program because it was partially duplicating a service offered by its health plan and because the program’s cost was not sustainable without support from other payers. The clinic retains a care management program serving heart failure patients, and is reconfiguring primary care teams to take over the care coordination responsibilities. Patient and family engagement and patient activation initiatives. All the study sites recognized the value of engaging patients in care management to identify personal goals for lifestyle change or treatment and educating them about their treatment options, though all felt they could do more in this regard. Health Share has had a unique opportunity to partner with community-based organizations and social service agencies to address nonmedical determinants of health within the practical constraints of its budget. However, Medicare ACOs face particular challenges in engaging patients because Medicare beneficiaries are not formally enrolled in an ACO and cannot be offered incentives to change their behavior. Therefore, Medicare ACOs must rely on their physicians’ rapport with patients to encourage voluntary compliance with referrals within the ACO network and other recommendations. 4 The Commonwealth Fund Integrated data and analytics. Every site had developed cap