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Building a successful rural ACO: How asking "why?" leads to improved quality of care

Insight Article - May 20, 2019

Business Strategy

Christian Green MA
South East Rural Physician Alliance’s story started with a simple question: Why participate in an accountable care organization (ACO)? Although the answer was guided by several principles, it was driven by a passion to serve patients in rural Nebraska. 

“We want to improve the health in our communities so that patients receive the highest quality of care … and meet their needs at a lower total cost of care,” Joleen Huneke, chief executive officer, SERPA ACO, LLC, Crete, Neb., said of the group’s vision in April at MGMA19 | The Operations Conference in Austin, Texas. 

To address higher costs and the subsequent burden on patients, the group, then composed of nine independent family practice clinics, collectively started an ACO in January 2013.


  • SERPA is made up of 16 independent family practice clinics across 19 Nebraska counties, with 80 physicians and 40 nonphysician providers.
  • Each clinic has between four and 15 providers.
  • The total panel is about 200,000 patients. 

Group structure and guiding principles 

How did SERPA increase its reach, while achieving its goals of becoming a successful ACO? According to Huneke, the group’s physicians weren’t as engaged when SERPA was an independent physician association (IPA), so it was imperative to develop ways to increase physician engagement. 

This started with structuring the ACO to meet the group’s needs. Seven committees — compliance, contracting, finance, information technology (IT), marketing, quality and executive — were formed, each headed by a physician and a clinic administrator. This structure was essential in working with payers: “When you’re talking to a payer, and you have around the table over 100 years of experience through clinic administrators, there’s not a lot that gets by,” Huneke asserts. “Each one of those administrators pulls something different out of that contract, and it is an amazing process.”

Once the structure was established, SERPA focused on four guiding principles to finish answering the “why” question. 
  • Improve patient quality of care, while reducing their total healthcare costs. The group primarily serves lower-income, rural patients. Huneke says that it was a priority for the group to not treat patients as though they are on an assembly line; rather, the group determined ways to provide affordable quality care. 
  • Partner with others. Partnerships with providers, payers, consumers, etc., had to be equitable for both sides. 
  • Make clinics sustainable. Through various resources, whether financial, staffing or quality improvement, the group needed to grow stronger over time. 
  • Share rewards. The rewards for keeping patients healthy and keeping costs down had to be evenly spread across the group. For example, the largest clinic (15 providers) could not take more patients than the smallest clinic (four providers). 

Transforming physician culture

Once the principles were put in place, physician culture had to be addressed. In switching from fee-for-service to value-based care, the group moved away from an assembly line mentality to something akin to artisan production, in which the physicians focus on quality of care rather than quantity. In speaking to the physician board as the group prepared to make the transition, Huneke used an analogy, comparing the physicians to dairy farmers when they were in the fee-for-service model. “You have to get up early in the morning or late at night and go out and see the patients to get paid, just like dairy farmers who have to get up early to milk the cows to get paid,” she expressed. 

In moving to value-based care, payer contracts were initially focused on total cost of care (TCoC) but then included quality measures as well. This led to a sea change in how SERPA provided care — now they were paid to consider quality measures such as preventive services. As a result, Huneke’s dairy farmer analogy for value-based care evolved: Now “they don’t just milk the cow; they don’t just see the patient — they are now taking care of the whole cow,” Huneke maintains.  

Similarly, as the group moved from eminence-based care to evidence-based care, the physicians changed their way of thinking. Clinical decisions were no longer opinion-based; instead, they incorporated quality and cost data into the decision-making process. They also had to improve their knowledge in another important area: “They didn’t know what the cost of care was … what other industry does that?” Huneke asks. “If you ask someone, ‘how much are these shoes?’ the person who owns a shoe store knows how much the shoes are. In healthcare, the physician did not have that knowledge.”

It took the group time to normalize its data to support the move to evidence-based care — SERPA went through five data vendors in six and a half years. Eventually the clinics were able to obtain quality data reports to demonstrate their value to payers and hospitals. “We can lay our quality data out there, saying, ‘this is where we are; this is the type of quality we can prove,’” Huneke says. “That is so critical because that’s the accountable part.”

Huneke was also able to show the costs of procedures to physicians, which was eye-opening, and the available data created a healthy competition between physicians as transparency began to drive success. “When clinics see that they are below [the quality measure threshold] … they ask, ‘how did this clinic get so high?,’” Huneke conveys. This leads to improved communication between clinics because they want to know how they can improve.  

As Huneke notes, physicians often did what payers expected in the fee-for-service model; however, the value-based model established more of a partnership between the two sides. This symbiotic relationship has carried over to care coordination, as SERPA hired care coordinators who helped unify the group and close gaps in care. Before the care coordinators came on, Huneke says that “the care used to be very lacking in coordination. … They get more work done than the physicians to close gaps to get the coordination done for their patients.”  

Challenges and opportunities

During its six years as an ACO, SERPA has faced many challenges, but Huneke says the group’s ability to adapt on the fly has helped make it successful. The biggest obstacles have included: 
  • Government programs: 10 of the 16 clinics went to the Comprehensive Primary Care Plus (CPC+) model, which does not work well in rural areas. As Huneke points out, “All of the dollars that go to CPC+ go against the spend in the Medicare Shared Savings Program (MSSP),” so the extra amount spent would not benefit the group financially.  
  • Critical access hospitals: Although the group has been able to reduce patient days in the hospital, cost has not changed. Centers for Medicare & Medicaid Services (CMS) is aware of the issue, but it hasn’t been a priority to fix. 
  • Skilled nursing versus home care: The latter has largely been replaced by the former. This has been an issue for the group because skilled nursing is expensive and there are many elderly patients in Nebraska who don’t have extended family to take care of them, and many live far from hospitals. 
  • Ever-changing rules: CMS and payers regularly change rules, which keeps the group on its toes. For example, this year, CMS changed the rule on how quality is measured in Medicare Shared Savings.
  • MACRA/MIPS: These government programs are pushing clinics toward value-based care, so they need to be well-versed in this payment model.   
On the other hand, by becoming an ACO, SERPA has enjoyed many opportunities, including being able to build an infrastructure to meet the group’s needs, including hiring one to four care coordinators per clinic to help close care gaps. In addition, as Huneke emphasizes, “The thing that I’m very impressed with on the government is they’re trying. They’re not just sitting back, going, ‘we can’t do it.’ And there are some pretty innovative programs out there.”

As Huneke relates, a big part of SERPA’s success has been adhering to the motto of “we over me.” By doing so, the group has been able to control the cost of care to its patients while earning sizable returns under MSSP and other value-based contracts. 

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About the Author

Christian Green
Christian Green MA
MGMA Writer/Editor MGMA


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