ACOs or Clinical Integration?

On numerous occasions you have read here that the high cost and low quality of some health care in the U.S. is due to overuse or misuse of many therapies and the lack of coordination of care among various delivery points, causing duplication of services. If ACOs do what they are supposed to do, they will hold providers truly accountable for a patient’s care through its entirety by creating meaningful clinical collaboration between physicians and hospitals, utilizing clinical evidence-based treatment plans proven to result in higher quality and lower care.

Although there are major challenges to overcome, including connecting hospitals and physicians with electronic data and determining how ACO reimbursement will be distributed, CHRISTUS Health recognizes opportunity and supports the concept of ACOs, but more importantly, the idea of clinical integration, which is the basis of our strategy. This position provides an aligned approach to care management that allows hospitals and physicians to collaborate to provide coordinated, lower cost and higher quality care. The significant differences between ACOs and the Clinical Integration model are:

• ACOs are Medicare-only and are still based on a fee-for-service model (which limits their effectiveness in the short term, but they will likely migrate to capitation);
• Clinical integration requires an alignment between physicians and hospitals based on the desire to improve the cost/quality equation. That is the primary focus of the alignment.
• Clinical integration requires a governance structure that holds all parties accountable for evidence-based protocols that will ensure high quality and minimal "waste" in the care delivery process.
• Clinical integration requires data integration across the continuum, but with little specificity about how that occurs. In fact, some of the greatest success stories in clinical integration have been operating with little more than a data repository for years, but have been able to achieve significant improvements in clinical outcomes and cost.

While the challenges outlined by some industry analysts are valid, the concept of ACOs is a sound one if all parties are truly committed to improving the cost/quality equation; however, current legislation does little to actually hold all parties accountable and responsible to each other. Clinical integration, on the other hand, is not legally mandated, but is more of a business management model designed to reduce utilization, standardize care, manage care (via a medical home) and improve quality - while at the same time lowering overall cost. The most important benefit of doing so is that physicians and hospitals can co-negotiate for managed care contracts and can command higher payments from private payers on the front end for demonstrated superior quality.

A New Era for Hospital-Physician Alignment

There is no denying that we live in an era of rising health care costs. As a result, we have seen many strategies like health care reform to reduce these costs and ensure that everyone in our country has access to the care they need. It is clear that our shared goals of higher quality care at a lower cost can only be achieved through collaboration. This means collaboration between hospitals and physicians as well as providers across the continuum of care (long-term care, home care, clinics, etc.) and patients themselves.

I was recently interviewed for an educational report compiled and distributed by the healthcare financial management association on the topic of hospital-physician alignment, which covers why it is important now, and how health care systems can foster and support alignment with physicians (as well as the much-noted ACO model). I’m admittedly somewhat biased, but I believe it is a thorough, well-written report, and I suggest you pause to read it and share it with your teams.

Critical Success Factors for Accountable Care

As health care reform is seeking to restructure how care is delivered and reimbursed, the Accountable Care Organization (ACO) has come forth as a preferred model. A myriad of articles and conferences have appeared in response to the direction from the federal government in the hopes of educating both providers and insurers of not only what will constitute an ACO, but how they must operate to be successful.

Although many of the articles have little value, one written recently on behalf of the Advisory Board Company provides a wealth of knowledge in a well-organized fashion on this proposed model. Entitled “Health Care’s ‘Accountability Movement,' ” this article identifies and expands upon the 15 imperatives for success under accountable care. These 15 are organized into four categories:
• Physician alignment,
• Clinical transformation,
• Payment transformation and
• Information-powered health care.

As conversations about reforming how care is delivered continue and ACOs receive more and more focus, these considerations will become increasingly important.

Burning Questions, Part IV

We continue again this week with my answers to the questions posed by leaders from across CHRISTUS Health at our recent leadership retreat.

Q. What is the direction you see for our international partnerships?

A. CHRISTUS Muguerza has many opportunities to grow in Mexico. And as capital in that country becomes more widely available, I am sure they will continue to explore and undertake opportunities to expand. We have become more culturally competent through this relationship, and CHRISTUS Muguerza is a much stronger ministry because we are partners in extending Jesus’ healing ministry. One of our sponsoring congregations, the Sisters of Charity of the Incarnate Word of San Antonio, is most interested in us investigating an expansion into Peru to work with their health care ministries there, which include clinics, visiting home nurses, a prenatal program, and inpatient and outpatient hospice programs. Our other sponsoring congregation, the Sisters of Charity of the Incarnate Word of Houston, recently asked for our assistance in the strategic planning process for their ministries in Guatemala. Through these opportunities, we are examining many possible future partnerships and directions.

Q. Can CHRISTUS Health develop successful ACOs?

A. The question is not “can we”, but “how” and “when will we.” Although we know the future will present challenges, we also know that we have all the pieces and are gaining the knowledge to put the puzzle together that will make us successful long into the future, regardless of heath care reform or not. Our abilities are undergirded by our 5 Strategic Directions and our 8 Strategic Enablers. We will do what we need to do to continue on the journey to put care within reach of all who need it.

Q. Has CHISTUS Muguerza fulfilled my expectation?

A. Clearly what had been accomplished in CHRISTUS Muguerza, expanding from 2 to 7 hospitals, multiple clinics, and ambulance service, a drug and addition center, a behavioral services facility, rehab facilities, and a network of clinics for the poor, has far exceed my expectations and vision for our international operations when we began that partnership in 2001. The team their embraced the CHRISTUS brand from day one, and quickly made the decision to join us on the Journey to Excellence.

Q. How do you move people out of silo thinking?

A. The ability to get every member of the CHRISTUS family thinking about how to horizontally integrate rather than to vertically report and think will be a critical success factor for our ministry. Clearly, we need to continue to explain the rationale of why this mode of operations is critical, and expand processes like matrix planning to force multiple constituencies to come together to plan a coordinated approach. And finally, integrated behaviors have to be incorporated into the performance planning processes, with clear expectation and identifiable rewards for accomplishing such.

Creating an ACO: An Ethical Issue?

I’ve blogged before about Accountable Care Organizations (ACO) and reform. ACOs were one of the few specific programs mentioned in the Patient Protection and Affordable Care Act, and have therefore received much attention from health care organizations around the country.

But perhaps more important than the “how” of ACOs is the “why” of ACOs. It is the hope of health care reform that by better integrating care for a person across the health care continuum, we will, as providers, be able to improve quality of care and patient safety while reducing costs. In a recent article appearing in the July/August 2010 edition of Healthcare Executive, this outcome was characterized as “The Ethical Basis for Creating ACOs.” The authors indicated that organizations, like CHRISTUS Health, “have a moral imperative to deliver cost-effective, high-quality and safe health care.”

The authors also wrote a small section on being stewards of health care resources, one of the important guidelines embedded within our values. Hence, it appears that with our strong commitment to becoming a high quality low cost provider, driven by our values and organizational ethics, that CHRISTUS Health can develop an ACO that is a trusted resource for health and wellness care, serving as both a national and international model.

The Barriers to an Accountable Care Organization

In multiple health care-related journals over the last several weeks, readers viewed numerous articles as well as invitations to attend conferences to learn more about “accountable care organizations” or “creating high-performing care organizations.”

This new terminology, Accountable Care Organization, or ACO, is one of the critical efforts in the recent health care reform law that is proposed to reduce the cost of health care in the U.S. It is predicated on the belief that well-coordinated, integrated care will be more likely to increase quality of the outcomes while reducing costs in comparison to the often-fragmented care which is experienced by our patients today. This clearly makes sense to providers of care, and yet it is not the norm in medical practices today. What are the barriers that keep well-coordinated, high-quality, cost-effective treatment plans from being implemented across he care continuum? What barriers will CHRISTUS Health face in building its aggregator model, one of our five strategic directions on its continuing Journey to Excellence?

The first, and perhaps most, significant barrier is our current fee-for-service payment system. This system has unfortunately incented most providers to perform as many procedures and treatments as possible, repeating studies and tests that have been done elsewhere which, if results were obtained, would not need to be repeated.

The second barrier is that coordinating care which is personal, safe, accessible, reliable and efficient often takes time. To connect the dots between multiple points and providers rendering services to a patient on a health care journey requires phone calls, immediate completion of records so a patient can carry them from point A to point B and timely transfer of treatment plans to the next provider so studies/tests are not duplicated.

A third barrier is the educational experience of most providers, which has focused on individuals rather than a population health management model. The former focus often provides individual treatment plans with variability in quality and costs, while the latter focuses on more consistent processes which minimize duplication and rework, and maximize repeated learnings which encourage rapid-cycle improvement.

Yes, the logic behind ACOs make sense, but to make them successful, strategies must be put in place to knock down the barriers which are real and visible in U.S. health care today.