ACOs Will Need Automation Tools To Do Population Health Management

The rising interest in accountable care organizations (ACOs) springs from two factors: the Medicare shared-savings program for ACOs, which begins in 2012, and healthcare providers’ belief that major changes in reimbursement methods lie just ahead. But what most hospitals and doctors still haven’t come to grips with is how their entire business model must change to accommodate the requirements of ACOs.

ACOs will be accountable for the cost and quality of care for a defined population. To build a successful ACO, therefore, providers must collaborate to coordinate care and to maintain or improve the health of all of their patients. Achieving these goals depends on the ability of providers to become clinically integrated and to manage population health at the physician practice level.

Both of these capabilities require the use of health information technology that goes beyond electronic health records. Supplemental technologies will be needed to use the data in EHRs and other information systems for tracking, monitoring, educating, and proactively reaching out to patients. The aim is to engage every patient—regardless of the state of their health—and to ensure that they receive the recommended preventive and chronic care.

Payers Encourage Formation of ACOs

The Patient Protection and Affordable Care Act (PPACA) turned the ACO concept into a concrete reality by authorizing the Centers for Medicare and Medicaid Services (CMS) to set up a shared-savings program, starting January 1, 2012. This is not a pilot. It is a full-scale effort to incentivize healthcare providers to form organizations that are capable of improving quality and cutting costs.

Under CMS’ approach, an ACO that meets specified quality goals will be able to split with CMS any savings that surpass a minimum level. CMS has not yet spelled out what that threshold is or how much of the savings it will share with providers. It hasn’t even fully defined an ACO. But the law specifies that an ACO must include primary-care providers and must serve at least 5,000 Medicare patients. Among the organizations that might qualify are: large group practices, independent practice associations, physician-hospital organizations, and integrated delivery systems.

Further down the road, the Medicare ACO program might encompass other reimbursement methods, including payment bundling and partial or full capitation.

Some commercial payers are already moving in that direction. For instance, Massachusetts Blue Cross and Blue Shield launched its “alternative quality contract” before the passage of the health reform law. The alternative quality contract is a form of global capitation agreement with two features that differentiate it from the old HMO risk contracts: First, participants can qualify for graduated quality incentives. Second, the insurer pledges not to reduce their budgets in future years. In return, the contract holders promise to gradually cut cost growth to the rate of inflation.

Blue Shield of California is participating in a three-way pilot involving Catholic Healthcare West and Hill Physicians, a large Independent Practice Association (IPA) in northern California. Based on an agreement with the California Public Employees Retirement System, the Blue Shield experiment is focused on reducing HMO costs by sharing risks with the providers.

In contrast, an Anthem Blue Cross pilot with Los Angeles-based Healthcare Partners and Monarch Healthcare, an Orange County IPA, is trying to apply managed care principles in a fee-for-setting. One of several ACO demonstrations organized by the Brookings Institution and the Dartmouth Institute for Health Policy and Clinical Practice, the Anthem pilot is similar in many respects to the Medicare shared-savings program.

ACOs Change Business Paradigm

Whatever the degree of financial risk in particular ACO contracts, all of them will require providers to use a population health management (PHM) approach. Unless an organization can reach out to all of its patients, assess their health status, engage them in their care, and make sure they receive the care they need, it has little chance of being able to create savings or manage care within a budget.

Population health management has been defined as a healthcare approach that emphasizes “the health outcomes of individuals in a group and the distribution of outcomes in that group.” It addresses not only longitudinal care across the continuum of care, but also personal health behavior that may contribute to the evolution or exacerbation of diseases.

Among the key characteristics of health organizations that conduct PHM are an organized system of care; the use of multidisciplinary care teams; coordination across care settings; enhanced access to primary care; centralized resource planning; continuous care, both in and outside of office visits; patient self-management education; a focus on health behavior and lifestyle changes; and the use of health information technology for data access and for communication among providers and between providers and patients.

An effective ACO must not only take excellent care of patients who present for care, but must also try to monitor and stay in contact with people who rarely or never see healthcare providers. The importance of communicating with this segment of the population is profound, because it includes many individuals who will become sick and need acute or chronic care at some point in time. Therefore, an ACO that proactively addresses the health needs of this cohort will be able to control costs better than one that doesn’t.

Role of Technology

Electronic health records (EHRs) are crucial to clinical integration and care coordination. Not only can they make it easier for caregivers to document and retrieve patient information, but they also hold the key to health information exchange with other providers. However, EHRs are still mostly incapable of exchanging data with one another; even interfaces with labs and hospitals remain problematic, mainly for financial reasons.

Besides offering incentives to physicians who show “meaningful use” of qualified EHRs, the government is funding health information exchanges (HIEs) through the states, but these are still in their infancy. To achieve clinical integration, ACOs will have to form seamless electronic networks; consequently, we can expect these organizations to create or further develop local HIEs that will enable data exchange between disparate EHRs.

EHRs also have some drawbacks as tools for performing population health management. They are not designed for tracking populations, providing actionable reports on care gaps, or sending alerts to patients. ACOs will need not only EHRs, but also supplemental technologies that can perform these functions with a high degree of automation.

These tools, which can be used in conjunction with EHRs, include electronic registries; multiple outreach and communications methods; software that can stratify a population by health status; and health risk assessment programs that trigger alerts and provide educational materials to patients. Automated PHM tools ensure that the routine, repetitive work of managing population health is done in the background, freeing up doctors and nurses to do the work that only they can do.

These supplemental technologies can also aid ACOs in managing population health at the macro level. A sophisticated rules engine can integrate disparate types of data with evidence-based guidelines, generating reports that provide many different views of the information. For example, the entire patient population could be filtered by payer, activity center, provider, health condition, and care gaps. The same filters could be applied to all patients with a particular condition to find out where the ACO needs to improve its care for that disease.

ACOs could also use registries to prepare actionable reports for care teams on the care gaps for individual patients who are scheduled to visit. Such a summary report might show a patient’s last blood pressure, her last HbA1c, and whether she’s late for her mammogram, even if she comes in for a cold or a sprained ankle.

Another important determinant of population health is the degree to which patients are coached on improving their health behavior. Automation tools can also help in this area. For example, when a patient fills out a health risk assessment online or in a practice computer kiosk, that patient can receive educational materials tailored to his or her condition and can be directed to appropriate self-help programs for, say, smoking cessation or losing weight.

Scalable approach

Studies have shown that it would take more time than a physician has in a workday to provide all recommended preventive and chronic care to his or her patients. Moreover, given the shortage of primary care, physicians alone can no longer provide appropriate care to all of their patients. Delegating more tasks to midlevel practitioners and other clinicians can help, and many group practices are hiring care managers, as well. But there’s a limit to how many patients a care manager can follow, and a practice or healthcare organization can afford only a certain number of care managers.

This situation is challenging enough when one considers the two to five percent of patients in a typical primary care clinic that have advanced disease and multiple comorbidities. It has been estimated that in a group of seven primary care physicians, more than 1,000 patients meet these criteria. And that’s only the tip of the iceberg: the prevalence of disease in a patient population is far greater than physicians believe it is, because many patients are undiagnosed or have fallen off their radar screens. Moreover, many patients with known conditions are at risk of developing complications because of care gaps and/or lack of compliance.

At the scale of an ACO, a small army of care managers would be required to manually carry out all of the requisite tasks for all the patients who need help. But by using automation tools, an ACO can manage a fairly large population effectively with care teams that are not appreciably larger than their current staffs.

In conclusion, the success of ACOs depends on clinical integration and population health management. To do PHM effectively and scalably, ACOs will have to turn to automation tools that not only extend the capabilities of their EHRs but also reduce the burden of routine care management work on their clinicians.

Richard Hodach, M.D., is the new chief medical officer of Phytel, a Dallas-based company that helps physicians manage population health. Hodach, a neurologist, was recently senior vice president and chief medical officer of Matria Healthcare, a wellness and disease-management company that was merged into Alere in 2008. Before that, he was medical director and vice president of medical affairs at Accordant, a disease management company that is now a subsidiary of CVS Caremark.