As more medical groups take on responsibility and risk for costs of delivery within accountable care organizations (ACOs), aligning financial and clinical outcomes requires a close eye on the data underpinning value-based arrangements.
According to Ashok Roy, MD, MPH, MBA, chief medical officer, Caravan Health, during his session at the 2021 Medical Practice Excellence: Leaders Conference, one of the main hurdles to group practices’ embrace of value-based arrangements has been the continued performance of volume-based care in many areas of the nation.
With continued promotion of value-based contracts by government payers and commercial insurers, there are specific areas of focus for practices in FFS-dominant workflows to prepare for a population health model that has a heavy emphasis on avoiding emergency department (ED) visits and inpatient stays, Roy said.
“Either you can choose to participate in value-based care, or eventually it may be forced on you by some payer,” Roy said, underscoring that it’s valuable if medical groups take initiative toward value to help set their own timelines for implementation.
Aligning incentives with new value-based metrics and engaging your physicians and providers is crucial, too, and underneath that work is an analytical foundation of easily accessible and frequently updated data on how the organization is doing, Roy said.
The role of scale in an ACO
Especially for organizations with close to the minimum of 5,000 covered patients attributed to the ACO, the lack of scale can be worrisome, Roy noted, as smaller ACOs experience higher variations in savings and losses simply due to statistical variation in healthcare spending and hierarchical condition category (HCC) coding (see Figure 1). “When you have 5,000 patients, it just takes a little variation in a couple patients to actually get loss, and the prospect of having a loss is disconcerting” for many practices, Roy added.
Roy has worked to produce larger groups, with hundreds of thousands of attributed patients across multiple ACOs composed of hundreds of clinics. That level of scale provides a cushion “so that the chances of not getting shared savings is incredibly low,” he said. “When you pool risk together, your chances to weather bad outcomes is much better.”
The economics of population health in an ACO
Mitigating that risk of loss and being able to receive shared savings is one of the major components of bringing in new revenue on a per-attributed-member, per-year (PMPY) basis, alongside any MIPS and/or APM bonuses, revenue from population health services [e.g., annual wellness visits (AWVs), HCC coding, care management services] and optimization of covered entities’ 340B outpatient drug pricing program participation.
In an ideal scenario, those combined revenues might yield more than $200 in net income PMPY after accounting for the costs of increased staffing and time devoted to those programs.
How data influences governance
When deciding on which direction to take an ACO in the journey into value, Roy said he conducts an “opportunity analysis” that accounts for current performance for different categories of care (e.g., home health, specialists, emergency) in terms of per-patient, per-year (PPPY) cost, expense per event, as well as the risk adjustment score of the patient population (see Table 1).
These data analyses allow an ACO to make informed decisions on what drivers of total cost to focus on in value-based programs, especially once those costs and patient counts are considered based on specific disease processes [e.g., diabetes, congestive heart failure (CHF), chronic obstructive pulmonary disease (COPD) — see Table 2].
For one group, reining in inpatient medical costs from the current performance to the ACO’s median performance presented an annual potential savings of $629,610. At the same time, specialist care had nearly a $1.5 million savings potential. Understanding how much there was to gain in those areas helped the group’s leadership decide on immediate initiatives that could drive the largest amount of savings, Roy said.
“It may be more palatable to start off with a COPD or CHF program,” Roy said. “You will notice a decrease in ED visits and inpatient admissions within 12 calendar months” more so than some other quality improvement initiatives. “I may start a great diabetes program that I may not see a decrease in inpatient visits or ED visits until two to five years later.”
This level of data can help organizations base their decisions on estimated results and not be as prone to factors such as internal politics. “Don’t let the specialty of the chief medical officer drive decisions,” Roy said. “Let the data drive the decision.”
Impacts on clinical initiatives
While the phrase “the right care at the right time” is often used in the industry, the role of data analytics is to better define how you target the right patients at the right time, Roy said, and that often means applying risk stratification across care initiatives to better triage chronic conditions and manage patient populations effectively.
In the area of care management, groups sometimes focus on enrollment rates as a percentage of all attributed patients, but Roy cautioned that such an approach often includes low-risk patients who do not need priority for outreach. “I’d rather you get 30% of your high-risk patients [into care management] than 50% of your total patients,” Roy said.
Having data to determine which higher-risk patients can be prioritized for AWVs, same-day visits, post-discharge appointments and other limited slots to see a clinician will allow the group to see a larger percentage of those patients at the higher frequencies required for the necessary care interventions.
“Let’s say everyone who’s qualified for a mammogram gets a mammogram outreach, but by a mailer, portal message or an email,” Roy said. “The high-risk patients should get either a second intervention by those same modalities, or they get a phone call to follow up with them — it’s making sure that higher-risk patients receive more frequent contacts.”
To further optimize the time available for higher-risk patients, Roy stressed the need for multidisciplinary care team members — physician, medical assistant (MA), front office, back office and social worker, when available — to be working at the top of their respective licensures and scopes of work for maximum efficiency and as many access opportunities as possible.
“The main thing we find with value-based care, it’s having frequent touches with the patients … and it does not need to be a clinician [each time],” Roy said. “Just having a very well-trained front-desk staff person to make outreaches to patients to see how they’re doing” can make a big difference in how well the practice keeps tabs on higher-risk patients. “And it makes the patient feel better” that someone cares enough to check in.
In addition to the benefits to physicians to invest more of their time in patient care, the increased reliance on the rest of the clinical team members makes them feel their training and experience is being used for the best purposes, Roy suggested.
Data’s influence on team-based care
Roy said that in addition to the updates to scheduling for high-risk patients, the risk score data can help practices plan for health risk assessments with those highest-risk patients — over the phone, with a nurse or an MA, about seven days in advance of an in-person visit.
“If we do this ahead of time … it not only gets the risk assessment [done],” Roy said. “It serves as a pre-visit plan and we can make sure that they get the proper labs before they come to the visit, so the visit is more impactful.”
Case study: Hayes Green Beach Memorial Hospital
Hayes Green Beach Memorial Hospital, a 25-bed critical access hospital in Charlotte, Mich., joined the Southern Michigan Rural ACO in 2016. In looking at the hospital’s data, it was decided to implement programs to improve advanced care planning, care management, HCC coding and AWVs.
Through those targeted improvements as part of joining an ACO:
- Fall risk screenings increased by 321%.
- Diabetic eye exams increased by almost 74%.
- Pneumococcal vaccinations rose by almost 40%.
- The rate of AWVs rose 24%.
- Chronic care management rates rose 6%.
- Clinical depression screenings increased by about 30%.
Through the improved performance, they received $4.2 million in ACO shared savings in 2018, and also received savings in 2019 and 2020.
Roy stressed that ensuring that providers get a significant share of any savings achieved is important to keep clinicians motivated to sustain value-based programs over multiple years, and that it’s made clear to providers that the increased pay was tied directly to their exceptional performance in those care initiatives.
Roy also said it’s important to ensure that practice leaders understand how much of the total patient panel is attributed as part of a value-based arrangement. If the vast majority of a provider’s panel is still in a fee-for-service arrangement, it will be difficult to encourage and sustain changes in the care delivery workflow to achieve what’s needed to make improvement for the smaller segment of attributed patients in a risk-bearing arrangement.
“They’re always going to provide great care for the patient, that’s never in question,” Roy said. “Do I actually stay extra hours to take care of a patient? Do I have a patient come in versus just sending them to the emergency room?” It depends on the motivation, Roy concluded, and data to outline a path to that success can be a difference maker. “It does influence behavior.”
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