Transcript Operating an ACO - Part 2 - American Association of Accountable

Operating an ACO - Part 2
June 23, 2011
Speakers
• David Jones – CureIS Healthcare, Inc.
(Minneapolis, MN)
612.834.4544
[email protected]
• Michael Kosir – Initiate Consulting (St. Paul,
MN)
612.247.9728
[email protected]
Presentation Overview
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What got us here
Why ACO | Why Now
Commercial vs Government ACOs
Medicare Shared Savings
Governance
Data Driven
Care Management
Financial Formula
Summary
What Got Us Here
≠
Texas Workers Compensation Research Institute
33% expenditure difference across state…with near-equal outcomes.
Striking the Balance: An Analysis of the Cost and Quality
of Medical Care in the Texas Workers’ Compensation System
Global The Commonwealth Fund
U.S. = highest cost but last in outcomes.
2007 study of 6 industrialized countries
Texas New Yorker
50% Medicare expenditure difference between similar
health populations of El Paso & McAllen.
A Cost Conundrum: What a Texas Town can teach us about health care
What Got Us Here
Runaway Inflation
Spending on Health Care Services
In 2005 dollars
4.9%
1965
$187 Billion
Average Annual Growth
2.1%
2005
$1.9 Trillion
Average annual GDP growth
5.1%
of GDP
Source: Congressional Budget Office based on health services and supplies, as defined in CMS national health expenditure accounts.
17.6%
of GDP
2009
Why ACO | Why Now
Evolution
Domestic Medicine
1:1 doctor – patient relationship
Fee For Service
Insurers pay for transactions
Employer-based Care
Employed physicians serving employees
HMO
Controlled reimbursement | some quality
Medical Home
Medical team
ACO
Patient-centered care controlled by medical professionals
ACO Differences
Medicare
Commercial
• Patients Assigned
• Patients Engaged
• Patients Free to Roam
• Patients Corralled
• Patients Stay in Medicare
• Patients Change Jobs/Plans
• Payment/Penalty Terms Set • Payment/Penalty Terms
Negotiated
• Quality Measures in Place
• Quality Measures Similar
• Pioneer Option
Medicare Shared Savings Program
Objectives (3 Part Aim)
1
Better Care for Individuals
2
Improved Health for Populations
3
Lower Growth in Expenditures
!
Data Information Data Information Data Information Data Information Data Information Data
Qualified & Quantified
Medicare Shared Savings Program
Requirements
• Minimum term 3 years
• Financial means to repay losses & facilitate receipt/distribution of savings
• Minimum Medicare beneficiaries
5,000
• Leadership & management for both clinical and administrative activities
• Information Infrastructure ability to evaluate data & give feedback to organization
• Shared governance representing beneficiaries, community partners, and provider/suppliers
• Provider Driven 75% of governing body must be ACO participants
• Public reporting of ACO performance and operational metrics
and more…
Data & Information Drive Success
Technology
Component
Definition
Examples
Financial
Infrastructure
Ability to accept, track allocate
payments associated with
performance results
•Validate budget goals based on beneficiary
population
•Track performance payments received
•Administer payment to participants
Reporting
Infrastructure
System to share performance data
with payer, management and
participants
•Monthly performance reports
•Population management trends (disease/case
management)
•Utilization practice variance reports
Performance
Management
Dynamic reports and dashboards
supported with proactive alerts
and tasks.
•Disease-specific reports/alerts (CHF, COPD)
•Actual results vs. benchmarks (ALOS,
readmissions)
•Adherence to evidence-based medicine
Data
Aggregation
Meaningful joining of all data to
create a holistic view of
population’s care experience
•Sharing all data (Lab, radiology, pharmacy, etc.)
•Disease Registry
Governance – It REALLY Matters
A commitment by leadership to improve value as a top
priority + a system of operational accountability to improve
performance at the following levels:
– Care Management
• Total Medical Leadership Commitment
– Administrative
• Active Medical Leadership Participation
– Marketing
• Active Medical Leadership Participation
– All Else
• Active Medical Leadership Participation
If not engaged
nothing else
matters
Care Management
Critical Aspects
•
Early diagnosis & intervention diabetes, CHF, COPD, etc.
•
Active application of best practices alerts, etc.
•
Peer review participating providers
•
Reduction of unnecessary ER visits
•
Reductions of hospital readmissions alerts, etc.
•
Creative patient education services e-mail, text, etc.
Opportunities are endless…
Patient Satisfaction
Build it… they may not come
One of the 5 quality domains is Patient/Caregiver Experience. Simple
Patient surveys assess the following:
• Getting Timely Care, Appointments, and Information
• How Well Your Doctors Communicate
• Helpful, Courteous, Respectful Office Staff
• Patients' Rating of Doctor
• Health Promotion and Education
• Shared Decision Making
• Health Status/Functional Status
Imagine if 20% of your shared savings
were determined simply by
measuring patient satisfaction.
Quality
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65 Measures
5 Domains includes patient/caregiver experience
6 Core disease states
PQRI limits
EHR Meaningful use
and more…
Medicare Shared Savings Program
The Basic Formula
How It Works
FFS
+
[
Minimum
Quality
+
]
Minimum
Savings
Intent: increased quality and increased
savings equals increased sharing.
=
$
Formula: Components
One Sided
• Shared savings payments for achieving cost saving
benchmarks
Two Sided
• Shared savings payments (higher percentage) for
achieving cost saving benchmarks
• Repayment of shared losses
All ACOs will operate under the two sided model
in year 3 of the initial contract period and thereafter.
Formula: Components
Number Beneficiaries
One Sided
Two Sided
Sliding
Scale
Set
@ 2%
Up to
2.5%
Up to
5%
7.5%
of
benchmark
10%
of
benchmark
MSR
FQHC/RHC
Savings Share Maximum
Shared Savings
50%
60%
Shared Losses
Greater than 2% of benchmark
NA
Maximum – 10%
Formula: Components
Minimum savings rate for each one sided ACO based on the
number of beneficiaries assigned. MSR calculated as follows:
Number
Beneficiaries
MSR
(low end)
MSR
(high end)
5,000 - 5,999
3.9%
3.6%
6,000 - 6,999
3.6%
3.4%
7,000 - 7,999
3.4%
3.2%
8,000 - 8,999
3.2%
3.1%
9,000 - 9,999
3.1%
3.0%
10,000 - 14,999
3.0%
2.7%
15,000 - 19,999
2.7%
2.5%
20,000 – 49,999
2.5%
2.2%
50,000 – 59,999
2.2%
2.0%
60,000 +
2.0%
Formula: Components
• Retrospective benchmarks = 3 years of data
(weighted 60%. 30%, 10%)
• No prescribed payments
• Payments to TIN
• Forfeit savings if ACO departs program early
• 25% withhold of shared savings payment to offset
possible future losses (2-sided only)
Formula: An Example
New Way ACO 1-Sided Model
20,000 patients @ $8K average cost/yr (3 yr historic avg.)
Benchmark = $160M
2.5% MSR = $4M
Target Spend = $156M
Performance Year 1 = $140M
Net Savings = $20M
Maximum = 7.5% of benchmark ($12M).
New Way keeps everything.
50% of Savings = $10M
FQHC/RHC 2.5% Credit = $0.5M
Total Savings Share = $10.5M
Sharing
Sharing the Savings
You Decide!
Summary
If You Remember Nothing,
Remember This:
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•
•
•
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Medical Leadership Engagement
Data & Information
Quality Care
Patient Satisfaction
Know Your Formula
Upcoming Webinars
Understanding Regulations of ACOs
July 14, 2011
For more information and to register, visit
www.aaacountablecare.org
For More Information
Don Giroux
Associate Director
952-896-3236
[email protected]
AAACO Website
www.aaacountablecare.org