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Premier: ACOs Poised for Growth

 |  By cclark@healthleadersmedia.com  
   December 20, 2013

After much enthusiasm but a sluggish start, insurers and healthcare providers appear to be gearing up for greater participation in accountable care organizations, according to a new survey from Premier, Inc.

Payers and providers have been more reticent about creating accountable care organizations than their enthusiasm projected 18 months ago, according to a recent survey of senior hospital executives.

Asked ACO creation in the spring of 2012, nearly 5% of these leaders said they were part of an ACO. An additional 47% were confident they'd have one in place by the end of 2013. In reality, only 18.3% of these respondents had an ACO in place in August of 2013.

The responses were in response to a questionnaire distributed by Premier, Inc., the group purchasing and quality improvement organization with about 2,900 member hospitals.

The slow growth rate won't last, Premier officials believe.

Questioned again this fall, a higher number of survey respondents indicated confidence that their hospitals would be involved in an ACO soon, and about 6.6% fewer than in the spring survey said they would not participate in an ACO in the foreseeable future.

"Many organizations have decided that this is a direction that's not going to go away," Joe Damore, vice president of Population Health Management for Premier said during a news conference Wednesday to announce the survey results. "So they're building the infrastructure that will pay dividends as they convert more and more of their contracts into population health and ACO contracts."

Accountable care organizations, which were given legal authority and ground rules by regulations related to the Patient Protection and Affordable Care Act, come in many styles and sizes.

But their common feature is an agreement between hospitals, multi-specialty and primary care physicians, and other care settings to coordinate high quality services and to lower costs.

The Premier surveys also found that executives of urban hospitals and independent delivery networks were more likely to have or be planning to include an ACO contract, while rural hospitals and stand-alone organizations were least likely.

Furthermore, survey respondents revealed that investments in population health management programs and information technology are driving improvements in supply chain, clinical data, predictive analytics and to integrate clinical data with claims.

Multi-Owner Regional Population Health Orgs
Premiere's Damore, who has visited140 hospital communities in the last three years notes that "the other thing we're seeing, which isn't in our survey, is the formation of multi-owner regional population health organizations, in which groups of hospitals come together... to focus on population health. And we're beginning to see this in many states."

Damore said that these entities are not yet public, "but we expect many will be in 2014."

Also on the trend list are private arrangements between hospitals and commercial health plans to share data and cost savings.

When claims data is transparent, "this allows the delivery system to really understand use rates, total costs, and to help manage care," Damore said. "In the past 10 days, I've personally met with three different major insurance companies —two commercial and one Blue Cross plan—who are now in the process of shifting a portion of their business into these population health arrangements.

Medical Homes
Providers are also more amenable to creating patient-centered medical homes, Damore said. About 27,000 primary care physicians are estimated to be involved in medical homes nationally.

Lastly, he said, there's been a "rapid growth" in projects to manage high risk populations—that 2% to 3% of any community that uses the most expensive resources to deal with multiple chronic diseases.

"We're seeing a lot of success with organizations putting systems in place."

Executives from two organizations, Carilion Clinic of southwestern Virginia and Aurora Health Care of Milwaukee, WI, described success in both better quality measures and outcomes, and with early signs of lower utilization.

For example, said Michael Jeremiah, MD, chair of the Department of Family and Community Medicine at Carilion, his system has "seen early success in terms of four quality outcome [measures] around diabetic patients and those with hypertension… and emergency department utilization."

Richard Klein, executive vice president of the Enterprise Business Group for Aurora, is working directly with employers to create ACOs, "and we now have 75 companies signed up with approximately 15,000 enrollees. We're taking the risks on those contracts and working closely with Anthem Healthcare in particular and Aetna, at managing that risk."

Another program Klein highlighted is the "nurse navigation concept," which places nurses at a work site or in close proximity. "They're connected to our EHR and in many cases they have prescribe authority…and help to engage the work site and the workforce and dependents directly" in an effort to give patients what they need in a timely way.

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