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Analysis

NextGen ACO: 3 Steps to Value-Based Care

By Philip Betbeze  
   May 03, 2018

UnityPoint Health's foray into CMS' NextGen ACO model is helping the health system transition its entire book of business to a value-based model.

UnityPoint Health's participation in the initial rollout of CMS' Next Generation ACO Model helped them succeed beyond their expectations in their transition to reimbursement risk.

In performance year 1 (2016), UnityPoint's 85,000-member Iowa Health ACO earned more than $10.5 million in shared savings.

Like most health systems, UnityPoint still gets more revenue from fee-for-service than what Vice President and Chief Analytics Officer Betsy McVay calls fee-for-value, but she says the NextGen ACO model offered the health system an opportunity to transition to a value-based payment model.

"We know we need to be successful in risk models and, ultimately, full capitation, to provide the best quality care," she says. "It’s absolutely necessary."

Though most top leaders concede that not only is value-based care necessary, it's also ethically better to make that transition, many executive leaders at hospitals and health systems struggle with how quickly and fully to embrace the commitment, given that the two reimbursement systems are diametrically opposed, and how thin healthcare margins can be.

UnityPoint leaders say they believe navigating those two payment models can be done effectively and without absorbing huge losses in the process. Here's what they did to achieve savings.

Step 1: Target unnecessary costs by leveraging IT

Aric Sharp, the vice president of UnityPoint Accountable Care, which has responsibility over the NextGen ACO as well as several other commercial value-based contracts for the company, says its 15-person ACO division is critical in targeting interventions that can save costs through better patient management and elimination of variation.

The ACO team manages what Sharp calls a "broad-matrixed team effort" to move the organization toward value. UnityPoint's network consists of about 7,500 providers (approximately 2,000 are employed by UnityPoint) and 40-plus hospitals.

The organization's value-based contracts cover about 250,000 patients, a little more than a quarter of the patients in the entire health system, including about 85,000 in the NextGen ACO.

Philip Betbeze is the senior leadership editor at HealthLeaders.


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