ACO Rollout Expected to Vary Widely

The emergence of Accountable Care Organizations could have a significant impact on the day-to-day life of hospitalists, or then again not much at all.

It all depends on how far along hospital medicine groups are in developing systems of communication and improving transitions of care. Those groups that have invested the time and money in information technology systems, improving the discharge process, and building relationships with primary care physicians are likely to be ahead of the curve and ready to participate almost seamlessly in ACOs. The others will be playing catchup, experts agree.

Courtesy Carol A. Hart, Beth Israel Deaconess Medical Center.

Dr. Melissa Mattison, associate chief of the hospital medicine section at Beth Israel Deaconess Medical Center in Boston, currently treats patients from two different ACOs operating in the Boston area – the Beth Israel Deaconess Physician Organization and Atrius Health. She and her hospitalist colleagues were prepared for the introduction of the ACO model of care, which aims to better coordinate the management of patients by holding networks of providers financially accountable for the quality and cost of care across the inpatient and outpatient settings.

At Beth Israel, there is a robust electronic health record system that keeps primary care physicians up to date on their hospitalized patients so that communication occurs at key points of care. A postdischarge clinic provides timely follow-up care to patients who have difficulty accessing primary care services.

This proactive approach is a well-established strategy of Beth Israel’s hospital medicine program, Dr. Mattison noted. "This has been somewhat the mantra of hospital medicine: improved care for patients, improved transitions of care, and making sure we’re really creating a plan of care."

Not much has changed since the introduction of the ACO model in how she delivers care on a day-to-day basis. "Hospitalists are really trying day in and day out to do what’s right for the patient in front of them and to work with the system that they have," Dr. Mattison said.

ACOs have been a buzzword in health policy circles for about the last 5 years, and a few commercial health plans have experimented with the idea. But ACOs really got off the ground earlier this year when the Centers for Medicare and Medicaid Services (CMS) began testing the model among fee-for-service Medicare beneficiaries.

How this will impact hospitalists’ payments is still unclear. Several experts said that since hospitalist payment arrangements vary so widely already, the financial incentives associated with ACOs also are likely to be site specific.

Dr. Mattison said the ACO model provides an opportunity for hospitalists to continue the work they’ve already begun on transitions of care.

The financial incentives in the ACO environment call for keeping patients healthy and out of the hospital. For hospitalists, that means primarily preventing readmissions. That’s nothing new, said Dr. Joseph Li, chief of hospital medicine at Beth Israel Deaconess Medical Center and past president of the Society of Hospital Medicine.

"The things that hospitalists need to be thinking about should be things that we’ve really been talking about all along," he said.

But there will be some differences, too, Dr. Li said. It will likely be less important for hospitalists to focus on decreasing length of stay and doing discharges earlier in the day.

For instance, in the pre-ACO environment, a patient might be discharged to receive care at a rehabilitation facility for a few days before going home. But in the new ACO environment, the hospitalist may keep the same patient in the hospital another day and avoid the additional expense of the rehab stay.

"I think that we’re going to see that hospitalists are going to be thinking about that, and appropriately so," Dr. Li said. "That’s where it’s important for the patient, the doctor, and the hospital to be on the same page."

Dr. Li estimates that about 70% of the patients he sees are part of an ACO arrangement. But all patients that come through his hospital get the same care, he said, effectively raising the quality for everyone.

"We’re not picking and choosing which patients we don’t want readmitted," he said. "The real focus is that we want everybody not to be readmitted."

At the OSF Healthcare System – an integrated health system in Central Illinois and 1 of the 32 Pioneer ACOs selected by CMS for testing of the care model – they have the same philosophy about changing the way they provide care regardless of which patients are in an ACO.

"The goal of this is to improve the care of all of our patients, not just those in certain payment arrangements," said Dr. Stephen Hippler, vice president of quality and clinical programs for OSF Medical Group.

Most of the ACO-related preparations at OSF have occurred in the primary care setting, expanding the breadth and depth of their patient-centered medical home. But Dr. Hippler said there also is a critical role for hospitalists. The health system has developed a number of projects aimed at improving transitions of care, from risk stratification at admission to medication reconciliation to creating a more robust discharge process.

Hospitalists also will have a significant role in guiding patients to the appropriate level of care after discharge, he said. Similarly, the Pioneer ACO at Monarch Healthcare in Orange County, Calif., asks its 25 hospitalists to think about transitions of care immediately after finishing their history and physical with a new patient.

Hospitalists are in a unique position because they exist at a point of care where many inefficiencies and redundancies occur, said Dr. Michael Weiss, a pediatrician and the medical director of quality and performance improvement at Monarch Healthcare.

"Hospitalists are an absolute key to this equation," he said.

Getting the hospital piece right is critical for any ACO to be successful, since about a third of the dollars in the health care system are today spent in the acute care hospital, agreed Dr. Ron Greeno, chief medical officer for Cogent HMG and chair of the public policy committee at the Society of Hospital Medicine.

"If you don’t control those inpatient dollars, it will sink you when you start taking [financial] risk," he said.

As a result, the demand for hospitalists is only going to grow, but so will the expectations in terms of the scope of care. "The bar is going to be raised," Dr. Greeno said.

One of the biggest challenges for hospitalist leaders preparing for the ACO world is that they are still operating mainly in a fee-for-service system that pays for more care, not necessary better or more efficient care.

And many hospital medicine groups simply aren’t prepared to make the leap to the coordinated care model because they haven’t laid the groundwork in improving discharge and transitions of care, he said.

To get ready, Dr. Greeno advised hospital medicine groups to take a series of steps that are simple in concept, but much more difficult to execute. For starters, the financial incentives have to be aligned so that hospitalists keep patients out of the hospital. Physicians also need to take a standardized approach to clinical functions and other nonclinical hospital processes. Additionally, the internal and external communications must be working well and hospitalists need to be able to track and interpret data.

Even though it’s early on in the emergence of new care delivery models such as ACOs, hospitalists must start to change their mind-set and realize that the hospital is a cost center, not a profit center, said Dr. Bradley Flansbaum, a hospitalist who blogs about health policy issues for The Hospitalist Leader.

In this new world, physicians should be doing everything they can to move patients out of the hospital efficiently. But exactly how their performance will be measured is unclear. While CMS and other payers use "rudimentary" core process measures to assess hospitalist care, there are real questions about whether these metrics are valid indicators of better care delivery, said Dr. Flansbaum, a member of the Society of Hospital Medicine’s public policy committee and the society’s representative to the American Medical Association’s House of Delegates.

"We have crude tools right now to really measure people," he said.

With those measures in flux, the best strategy for hospitalists is to focus on the areas that are sure to be important in ACOs, such as discharge planning, medication reconciliation, and communication, Dr. Flansbaum said.

Other than that, hospitalists can wait and see how the model develops and if the Pioneer ACOs are able to deliver on the promise of better quality at lower costs. The consolidation that is occurring in some ACOs could result in cost-saving economies of scale, but it also has the potential to drive prices up, he said. Another question mark is whether the model will catch on around the country. For instance, high-performing health systems with low costs, like the Mayo Clinic, may opt not to make changes.

"There’s a lot of folks who are questioning whether or not this whole ACO model is viable for every hospital and every place," Dr. Flansbaum said.

Pioneer, Shared Savings: Payment Nuts and Bolts

In January, CMS launched the Pioneer ACO Model and selected 32 organizations to test out ways to offer coordinated care that improves quality and lowers costs. The Pioneers aren’t typical health systems, but rather organizations that already have significant experience in care coordination and may already have been operating as an ACO. Both the Beth Israel Deaconess Physician Organization and Atrius Health are among the Pioneers.

Under the 3-year program, the ACOs will have 2 years to continue receiving their regular fee-for-service payments, and they will have the chance to share in either the savings or losses to the Medicare program based on the cost of the care provided. Eligibility for those bonuses also would depend on meeting quality targets. In the third year, those organizations that have saved money for the Medicare program early on will be able to switch a substantial portion of their reimbursement to a capitated payment model in which they will receive a flat, per-beneficiary, per-month payment to manage an individual’s care.

CMS officials also have selected the first 27 organizations to participate in the Shared Savings Program, an initiative designed to test the ACO concept among organizations with less experience in coordinating care across inpatient and outpatient settings.

ACOs in the Shared Savings Program will receive their fee-for-service payments and be eligible to share in any savings they generate for Medicare. Organizations can choose to share in the savings, or take on more financial risk and potentially earn higher bonus payments.

The emergence of Accountable Care Organizations could have a significant impact on the day-to-day life of hospitalists, or then again not much at all.

It all depends on how far along hospital medicine groups are in developing systems of communication and improving transitions of care. Those groups that have invested the time and money in information technology systems, improving the discharge process, and building relationships with primary care physicians are likely to be ahead of the curve and ready to participate almost seamlessly in ACOs. The others will be playing catchup, experts agree.

Courtesy Carol A. Hart, Beth Israel Deaconess Medical Center.

Dr. Melissa Mattison, associate chief of the hospital medicine section at Beth Israel Deaconess Medical Center in Boston, currently treats patients from two different ACOs operating in the Boston area – the Beth Israel Deaconess Physician Organization and Atrius Health. She and her hospitalist colleagues were prepared for the introduction of the ACO model of care, which aims to better coordinate the management of patients by holding networks of providers financially accountable for the quality and cost of care across the inpatient and outpatient settings.

At Beth Israel, there is a robust electronic health record system that keeps primary care physicians up to date on their hospitalized patients so that communication occurs at key points of care. A postdischarge clinic provides timely follow-up care to patients who have difficulty accessing primary care services.

This proactive approach is a well-established strategy of Beth Israel’s hospital medicine program, Dr. Mattison noted. "This has been somewhat the mantra of hospital medicine: improved care for patients, improved transitions of care, and making sure we’re really creating a plan of care."

Not much has changed since the introduction of the ACO model in how she delivers care on a day-to-day basis. "Hospitalists are really trying day in and day out to do what’s right for the patient in front of them and to work with the system that they have," Dr. Mattison said.

ACOs have been a buzzword in health policy circles for about the last 5 years, and a few commercial health plans have experimented with the idea. But ACOs really got off the ground earlier this year when the Centers for Medicare and Medicaid Services (CMS) began testing the model among fee-for-service Medicare beneficiaries.

How this will impact hospitalists’ payments is still unclear. Several experts said that since hospitalist payment arrangements vary so widely already, the financial incentives associated with ACOs also are likely to be site specific.

Dr. Mattison said the ACO model provides an opportunity for hospitalists to continue the work they’ve already begun on transitions of care.

The financial incentives in the ACO environment call for keeping patients healthy and out of the hospital. For hospitalists, that means primarily preventing readmissions. That’s nothing new, said Dr. Joseph Li, chief of hospital medicine at Beth Israel Deaconess Medical Center and past president of the Society of Hospital Medicine.

"The things that hospitalists need to be thinking about should be things that we’ve really been talking about all along," he said.

But there will be some differences, too, Dr. Li said. It will likely be less important for hospitalists to focus on decreasing length of stay and doing discharges earlier in the day.

For instance, in the pre-ACO environment, a patient might be discharged to receive care at a rehabilitation facility for a few days before going home. But in the new ACO environment, the hospitalist may keep the same patient in the hospital another day and avoid the additional expense of the rehab stay.

"I think that we’re going to see that hospitalists are going to be thinking about that, and appropriately so," Dr. Li said. "That’s where it’s important for the patient, the doctor, and the hospital to be on the same page."

Dr. Li estimates that about 70% of the patients he sees are part of an ACO arrangement. But all patients that come through his hospital get the same care, he said, effectively raising the quality for everyone.

"We’re not picking and choosing which patients we don’t want readmitted," he said. "The real focus is that we want everybody not to be readmitted."

At the OSF Healthcare System – an integrated health system in Central Illinois and 1 of the 32 Pioneer ACOs selected by CMS for testing of the care model – they have the same philosophy about changing the way they provide care regardless of which patients are in an ACO.

"The goal of this is to improve the care of all of our patients, not just those in certain payment arrangements," said Dr. Stephen Hippler, vice president of quality and clinical programs for OSF Medical Group.

Most of the ACO-related preparations at OSF have occurred in the primary care setting, expanding the breadth and depth of their patient-centered medical home. But Dr. Hippler said there also is a critical role for hospitalists. The health system has developed a number of projects aimed at improving transitions of care, from risk stratification at admission to medication reconciliation to creating a more robust discharge process.

Hospitalists also will have a significant role in guiding patients to the appropriate level of care after discharge, he said. Similarly, the Pioneer ACO at Monarch Healthcare in Orange County, Calif., asks its 25 hospitalists to think about transitions of care immediately after finishing their history and physical with a new patient.

Hospitalists are in a unique position because they exist at a point of care where many inefficiencies and redundancies occur, said Dr. Michael Weiss, a pediatrician and the medical director of quality and performance improvement at Monarch Healthcare.

"Hospitalists are an absolute key to this equation," he said.

Getting the hospital piece right is critical for any ACO to be successful, since about a third of the dollars in the health care system are today spent in the acute care hospital, agreed Dr. Ron Greeno, chief medical officer for Cogent HMG and chair of the public policy committee at the Society of Hospital Medicine.

"If you don’t control those inpatient dollars, it will sink you when you start taking [financial] risk," he said.

As a result, the demand for hospitalists is only going to grow, but so will the expectations in terms of the scope of care. "The bar is going to be raised," Dr. Greeno said.

One of the biggest challenges for hospitalist leaders preparing for the ACO world is that they are still operating mainly in a fee-for-service system that pays for more care, not necessary better or more efficient care.

And many hospital medicine groups simply aren’t prepared to make the leap to the coordinated care model because they haven’t laid the groundwork in improving discharge and transitions of care, he said.

To get ready, Dr. Greeno advised hospital medicine groups to take a series of steps that are simple in concept, but much more difficult to execute. For starters, the financial incentives have to be aligned so that hospitalists keep patients out of the hospital. Physicians also need to take a standardized approach to clinical functions and other nonclinical hospital processes. Additionally, the internal and external communications must be working well and hospitalists need to be able to track and interpret data.

Even though it’s early on in the emergence of new care delivery models such as ACOs, hospitalists must start to change their mind-set and realize that the hospital is a cost center, not a profit center, said Dr. Bradley Flansbaum, a hospitalist who blogs about health policy issues for The Hospitalist Leader.

In this new world, physicians should be doing everything they can to move patients out of the hospital efficiently. But exactly how their performance will be measured is unclear. While CMS and other payers use "rudimentary" core process measures to assess hospitalist care, there are real questions about whether these metrics are valid indicators of better care delivery, said Dr. Flansbaum, a member of the Society of Hospital Medicine’s public policy committee and the society’s representative to the American Medical Association’s House of Delegates.

"We have crude tools right now to really measure people," he said.

With those measures in flux, the best strategy for hospitalists is to focus on the areas that are sure to be important in ACOs, such as discharge planning, medication reconciliation, and communication, Dr. Flansbaum said.

Other than that, hospitalists can wait and see how the model develops and if the Pioneer ACOs are able to deliver on the promise of better quality at lower costs. The consolidation that is occurring in some ACOs could result in cost-saving economies of scale, but it also has the potential to drive prices up, he said. Another question mark is whether the model will catch on around the country. For instance, high-performing health systems with low costs, like the Mayo Clinic, may opt not to make changes.

"There’s a lot of folks who are questioning whether or not this whole ACO model is viable for every hospital and every place," Dr. Flansbaum said.

Pioneer, Shared Savings: Payment Nuts and Bolts

In January, CMS launched the Pioneer ACO Model and selected 32 organizations to test out ways to offer coordinated care that improves quality and lowers costs. The Pioneers aren’t typical health systems, but rather organizations that already have significant experience in care coordination and may already have been operating as an ACO. Both the Beth Israel Deaconess Physician Organization and Atrius Health are among the Pioneers.

Under the 3-year program, the ACOs will have 2 years to continue receiving their regular fee-for-service payments, and they will have the chance to share in either the savings or losses to the Medicare program based on the cost of the care provided. Eligibility for those bonuses also would depend on meeting quality targets. In the third year, those organizations that have saved money for the Medicare program early on will be able to switch a substantial portion of their reimbursement to a capitated payment model in which they will receive a flat, per-beneficiary, per-month payment to manage an individual’s care.

CMS officials also have selected the first 27 organizations to participate in the Shared Savings Program, an initiative designed to test the ACO concept among organizations with less experience in coordinating care across inpatient and outpatient settings.

ACOs in the Shared Savings Program will receive their fee-for-service payments and be eligible to share in any savings they generate for Medicare. Organizations can choose to share in the savings, or take on more financial risk and potentially earn higher bonus payments.

The emergence of Accountable Care Organizations could have a significant impact on the day-to-day life of hospitalists, or then again not much at all.

It all depends on how far along hospital medicine groups are in developing systems of communication and improving transitions of care. Those groups that have invested the time and money in information technology systems, improving the discharge process, and building relationships with primary care physicians are likely to be ahead of the curve and ready to participate almost seamlessly in ACOs. The others will be playing catchup, experts agree.

Courtesy Carol A. Hart, Beth Israel Deaconess Medical Center.

Dr. Melissa Mattison, associate chief of the hospital medicine section at Beth Israel Deaconess Medical Center in Boston, currently treats patients from two different ACOs operating in the Boston area – the Beth Israel Deaconess Physician Organization and Atrius Health. She and her hospitalist colleagues were prepared for the introduction of the ACO model of care, which aims to better coordinate the management of patients by holding networks of providers financially accountable for the quality and cost of care across the inpatient and outpatient settings.

At Beth Israel, there is a robust electronic health record system that keeps primary care physicians up to date on their hospitalized patients so that communication occurs at key points of care. A postdischarge clinic provides timely follow-up care to patients who have difficulty accessing primary care services.

This proactive approach is a well-established strategy of Beth Israel’s hospital medicine program, Dr. Mattison noted. "This has been somewhat the mantra of hospital medicine: improved care for patients, improved transitions of care, and making sure we’re really creating a plan of care."

Not much has changed since the introduction of the ACO model in how she delivers care on a day-to-day basis. "Hospitalists are really trying day in and day out to do what’s right for the patient in front of them and to work with the system that they have," Dr. Mattison said.

ACOs have been a buzzword in health policy circles for about the last 5 years, and a few commercial health plans have experimented with the idea. But ACOs really got off the ground earlier this year when the Centers for Medicare and Medicaid Services (CMS) began testing the model among fee-for-service Medicare beneficiaries.

How this will impact hospitalists’ payments is still unclear. Several experts said that since hospitalist payment arrangements vary so widely already, the financial incentives associated with ACOs also are likely to be site specific.

Dr. Mattison said the ACO model provides an opportunity for hospitalists to continue the work they’ve already begun on transitions of care.

The financial incentives in the ACO environment call for keeping patients healthy and out of the hospital. For hospitalists, that means primarily preventing readmissions. That’s nothing new, said Dr. Joseph Li, chief of hospital medicine at Beth Israel Deaconess Medical Center and past president of the Society of Hospital Medicine.

"The things that hospitalists need to be thinking about should be things that we’ve really been talking about all along," he said.

But there will be some differences, too, Dr. Li said. It will likely be less important for hospitalists to focus on decreasing length of stay and doing discharges earlier in the day.

For instance, in the pre-ACO environment, a patient might be discharged to receive care at a rehabilitation facility for a few days before going home. But in the new ACO environment, the hospitalist may keep the same patient in the hospital another day and avoid the additional expense of the rehab stay.

"I think that we’re going to see that hospitalists are going to be thinking about that, and appropriately so," Dr. Li said. "That’s where it’s important for the patient, the doctor, and the hospital to be on the same page."

Dr. Li estimates that about 70% of the patients he sees are part of an ACO arrangement. But all patients that come through his hospital get the same care, he said, effectively raising the quality for everyone.

"We’re not picking and choosing which patients we don’t want readmitted," he said. "The real focus is that we want everybody not to be readmitted."

At the OSF Healthcare System – an integrated health system in Central Illinois and 1 of the 32 Pioneer ACOs selected by CMS for testing of the care model – they have the same philosophy about changing the way they provide care regardless of which patients are in an ACO.

"The goal of this is to improve the care of all of our patients, not just those in certain payment arrangements," said Dr. Stephen Hippler, vice president of quality and clinical programs for OSF Medical Group.

Most of the ACO-related preparations at OSF have occurred in the primary care setting, expanding the breadth and depth of their patient-centered medical home. But Dr. Hippler said there also is a critical role for hospitalists. The health system has developed a number of projects aimed at improving transitions of care, from risk stratification at admission to medication reconciliation to creating a more robust discharge process.

Hospitalists also will have a significant role in guiding patients to the appropriate level of care after discharge, he said. Similarly, the Pioneer ACO at Monarch Healthcare in Orange County, Calif., asks its 25 hospitalists to think about transitions of care immediately after finishing their history and physical with a new patient.

Hospitalists are in a unique position because they exist at a point of care where many inefficiencies and redundancies occur, said Dr. Michael Weiss, a pediatrician and the medical director of quality and performance improvement at Monarch Healthcare.

"Hospitalists are an absolute key to this equation," he said.

Getting the hospital piece right is critical for any ACO to be successful, since about a third of the dollars in the health care system are today spent in the acute care hospital, agreed Dr. Ron Greeno, chief medical officer for Cogent HMG and chair of the public policy committee at the Society of Hospital Medicine.

"If you don’t control those inpatient dollars, it will sink you when you start taking [financial] risk," he said.

As a result, the demand for hospitalists is only going to grow, but so will the expectations in terms of the scope of care. "The bar is going to be raised," Dr. Greeno said.

One of the biggest challenges for hospitalist leaders preparing for the ACO world is that they are still operating mainly in a fee-for-service system that pays for more care, not necessary better or more efficient care.

And many hospital medicine groups simply aren’t prepared to make the leap to the coordinated care model because they haven’t laid the groundwork in improving discharge and transitions of care, he said.

To get ready, Dr. Greeno advised hospital medicine groups to take a series of steps that are simple in concept, but much more difficult to execute. For starters, the financial incentives have to be aligned so that hospitalists keep patients out of the hospital. Physicians also need to take a standardized approach to clinical functions and other nonclinical hospital processes. Additionally, the internal and external communications must be working well and hospitalists need to be able to track and interpret data.

Even though it’s early on in the emergence of new care delivery models such as ACOs, hospitalists must start to change their mind-set and realize that the hospital is a cost center, not a profit center, said Dr. Bradley Flansbaum, a hospitalist who blogs about health policy issues for The Hospitalist Leader.

In this new world, physicians should be doing everything they can to move patients out of the hospital efficiently. But exactly how their performance will be measured is unclear. While CMS and other payers use "rudimentary" core process measures to assess hospitalist care, there are real questions about whether these metrics are valid indicators of better care delivery, said Dr. Flansbaum, a member of the Society of Hospital Medicine’s public policy committee and the society’s representative to the American Medical Association’s House of Delegates.

"We have crude tools right now to really measure people," he said.

With those measures in flux, the best strategy for hospitalists is to focus on the areas that are sure to be important in ACOs, such as discharge planning, medication reconciliation, and communication, Dr. Flansbaum said.

Other than that, hospitalists can wait and see how the model develops and if the Pioneer ACOs are able to deliver on the promise of better quality at lower costs. The consolidation that is occurring in some ACOs could result in cost-saving economies of scale, but it also has the potential to drive prices up, he said. Another question mark is whether the model will catch on around the country. For instance, high-performing health systems with low costs, like the Mayo Clinic, may opt not to make changes.

"There’s a lot of folks who are questioning whether or not this whole ACO model is viable for every hospital and every place," Dr. Flansbaum said.

Pioneer, Shared Savings: Payment Nuts and Bolts

In January, CMS launched the Pioneer ACO Model and selected 32 organizations to test out ways to offer coordinated care that improves quality and lowers costs. The Pioneers aren’t typical health systems, but rather organizations that already have significant experience in care coordination and may already have been operating as an ACO. Both the Beth Israel Deaconess Physician Organization and Atrius Health are among the Pioneers.

Under the 3-year program, the ACOs will have 2 years to continue receiving their regular fee-for-service payments, and they will have the chance to share in either the savings or losses to the Medicare program based on the cost of the care provided. Eligibility for those bonuses also would depend on meeting quality targets. In the third year, those organizations that have saved money for the Medicare program early on will be able to switch a substantial portion of their reimbursement to a capitated payment model in which they will receive a flat, per-beneficiary, per-month payment to manage an individual’s care.

CMS officials also have selected the first 27 organizations to participate in the Shared Savings Program, an initiative designed to test the ACO concept among organizations with less experience in coordinating care across inpatient and outpatient settings.

ACOs in the Shared Savings Program will receive their fee-for-service payments and be eligible to share in any savings they generate for Medicare. Organizations can choose to share in the savings, or take on more financial risk and potentially earn higher bonus payments.