New Goals, New Alliances
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Juan Serrano, a veteran health plan executive, is now CHI's senior vice president of payer strategy and operations, a function that is part of that effort to expand the organization's capabilities in cooperation with payers and employers.
Serrano says such shared incentives are critical to eventually managing the health of populations because the level of detail needed on the provider side for clinicians to focus on high-value interventions for patients with chronic conditions, for example, is beyond the ability of most health systems to incorporate alone.
Some health plans are providing this information not just with unit costs, but also with even more detail, which enables comparisons and helps tailor cost-effective care. An example of this greater detail would be statistics on total cost of care for a given episode of care in the given market. That data allows the health plan to prove that the provider is either very valuable to the health plan (and by proxy, patients and employers) versus competitors, or show where it falls short.
"This enables people to rally around how to solve problems as opposed to negotiating," says Serrano.
He notes that longitudinal total cost of care for a population is, in a way, a foundational prerequisite for understanding all the moving parts that come together to improve both outcomes and the cost of serving that population. For example, an aggregate snapshot of pharmacy, lab, physician, and hospital claims for certain services can provide a previously unavailable sight line for a particular physician group.
"That's one piece of the so-called longitudinal data that's needed," he says.
Serrano says it's important also to measure the impact of referral patterns on cost and quality measures.
"The physician community has received reports from payers showing how they compare to their peers on cost and some quality measures, but getting more granularity on the impact their referral patterns are having on outcomes from a cost and quality perspective enables the health system to rally and think about ways to solve these types of issues," he says.
Serrano also would like to see potential payer partners offer more specificity around the types of products and services on which the payer is interested in partnering.
"Historically, this has been pretty global in that they want you to serve all their commercial or government program members," he says. "But value is created at a more granular level."
G. Anton Decker, MD, is president of the board of directors at Banner Health Network and chief medical officer of the Banner Medical Group, a Phoenix-based system that operates 24 hospitals in seven states and reported 2013 total revenues of $5 billion. His organization has partnered with Aetna in an accountable care collaboration called the Aetna Whole Health Plan. Decker says many physicians and practices are still living in the fee-for-service age, but that age is rapidly coming to a close with initiatives like the Banner-Aetna partnership.
"Ten years ago, there were a lot of theories that doctors would be paid on performance and data would be shared in the future. Everyone knew it would happen but didn't know when or how," says Decker, a gastroenterologist. "But now it's an absolute reality. Physicians see their data, their colleagues' data, and how they measure up with national benchmarking. Sharing of that data and differential reward for superior performance is a reality and people aren't questioning it."
At the same time, what can be difficult is assessing the accuracy of the data.
"If I'm going to pay a doc differently based on how they perform, the data has to get into the system accurately," he says. "Who's putting it in? Is it automated? All those steps create room for error."
Through the partnership with Aetna, among other initiatives, Banner has cleaned up patient data so that "now there's a lot more trust, and that data is becoming actionable," he says.
When physicians get annoyed by data comparisons—and sometimes they do—Decker reminds them that transforming to being measured on value added is a long transition. However, he's insistent that data given to physicians to measure their performance must be as accurate as possible.
Banner has clearly hammered out some of the challenges, because its results in such accountable programs are impressive. Its case management model, which is independent of any specific contract with an insurer, lowered its average inpatient length of stay across 11 hospitals to 3.81, a 7.52% improvement since the program was enacted. And although some organizations that initially joined CMS' Pioneer ACO program dropped out after the first year largely because they weren't able to achieve much in the way of savings, Banner's Pioneer ACO recorded more than $13 million in shared savings over its first year.
Open access versus ACO
Some health plans are trying to get better value from providers by incorporating them into an accountable care organization of some kind. Some argue that allowing patients to seek care from providers who are not contractually linked to the ACO taints the population data and makes hospitals and physician practices accountable for care patients obtain from providers outside of their systems.
While that's true, says Dick Salmon, MD, medical director for Hartford-based Cigna, the patient and the payer alike ultimately benefit from the patient's relative freedom to seek care where they choose. Cigna is a global health service company with annual revenues of about $29 billion.
While Cigna operates 89 ACOs in 27 states, these structures allow open access. That is, patients are not required to seek care within the parameters of the ACO, although there are incentives for them to do so. Branded as "collaborative accountable care," the name is intended to indicate that the health plan provides services to healthcare professionals to help them optimize their care of patients—it's not just the provider who's doing the work on patient satisfaction, quality improvement, and cost containment.
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