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Medicare Shared Savings ACO Trio Shares Keys to Success

 |  By Christopher Cheney  
   October 12, 2015

The top performers in the Medicare Shared Savings Program are leveraging their experience with population health and their willingness to embrace innovation.

The pathways to shared-savings success are becoming clearer.

Houston, TX-based Memorial Hermann Accountable Care Organization and Portland, ME-based MaineHealth Accountable Care Organization are two of the most successful MSSP participants in the country. Executives at these ACOs say their organizations have been able to earn millions in MSSP shared-savings payments based on lengthy experience in population-health initiatives and wise investments in new capabilities.

Christopher Lloyd

"One of the reasons we have been so successful is this is not a new conversation for us," says Christopher Lloyd, CEO of Memorial Hermann ACO.

Memorial Hermann ACO's financial success as an MSSP participant is impressive, with the organization posting shared-savings payments in the federal program's first and second performance years, according to Centers for Medicare & Medicaid Services data. In Performance Year 1, which reflects data collected from 220 MSSP ACOs in calendar year 2013, Memorial Hermann ACO served 34,430 Medicare beneficiaries and earned shared-savings payments totaling $28.3 million. In Performance Year 2, which reflects data collected from 333 MSSP ACOs in calendar year 2014, Memorial Hermann ACO served 40,911 Medicare beneficiaries and earned shared-savings payments totaling $22.7 million.

The Memorial Hermann health system, which features 13 not-for-profit hospitals and about 5,500 affiliated physicians, was well-positioned for MSSP participation when the organization launched its ACO in July 2012, Lloyd says.

Having clinically integrated hospital and physician networks has been "absolutely fundamental" to Memorial Hermann ACO's success, he says. Prior investments in establishing patient-centered medical homes also have boosted MSSP performance. "That's the foundation. [Our primary care physicians] understand the concepts of cost and quality."

On the hospital side, Memorial Hermann ACO has sought to maximize value for both inpatient and outpatient services, driving down costs while maintaining quality in areas including supply chain and pharmacy.

"It helps us manage the total cost of care. We're pretty sophisticated at determining total cost of care, but we're not sophisticated enough yet. … We're calling it medical economics: understanding total cost of care and where the spending occurs," Lloyd says.

Strengthening the capabilities required to track total cost of care has been a top priority at Memorial Hermann ACO and throughout Memorial Hermann health system, he says. "The fastest area of investment is in medical economics." Those investments have included information technology upgrades and hiring a range of data-oriented staff members such as actuaries and data analytics specialists. "It is a whole series of people who have not been in the health system before."

Next month, Lloyd and a half dozen other Memorial Hermann executives are slated to provide a three-hour online presentation about the health system's ACO prowess.

Christopher Cheney is the senior clinical care​ editor at HealthLeaders.

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