This year’s (5th) Accountable Care Congress (which conspicuously dropped the accountable care “organization” from its conference name) was much more somber, and well, business-like. There wasn’t the buzz and excitement of the first years about launching new ACO models under the Affordable Care Act (ACA), but also not the disappointment and handwringing from the last two years when initial reports of savings data from Medicare Shared Savings Program ACOs were underwhelming, and news was announced that several Pioneer ACOs were abandoning the model.

This year, several presenters began with data showing the slowing growth of national medical expenditures (although still at 18% of U.S. GDP), a “secular trend” that may or may not be related to the emergence of ACOs and/or the implementation of the other parts of the ACA (ascribing cause and effect from policy changes is always imprecise).
One of the thought leaders driving the creation of ACOs, Dartmouth Institute of Health Policy and Clinical Practice’s Elliot Fisher gave the opening plenary and began with data showing “no relationship” between health care expenditures and quality outcomes. Fisher outlined the component elements of accountable care: clear quality improvement and cost reduction aims, good data, organized systems of care focused on improving population health, and value-based payment. He noted that overall, while almost all ACOs have achieved quality improvements, only about half have achieved cost savings, and only about a quarter have achieved shared savings (beyond benchmarks). Finally, he noted that while physicians are leading over half of all ACOs, some of the newest ACO models are operated by national chain pharmacies like Walgreens and by Federally Qualified Health Centers.

The only Center for Medicare and Medicaid Services (CMS) speaker was Hoangmai Pham (appearing by video), who presented data that Medicare ACOs have showed improvement on 30 of the 33 quality measures, and the Pioneer ACOS have showed improvement on 28 of the 33. She also reported a total of $372 million in total program savings from all the CMS ACOs. In her usual politic way, Pham listed some of “what CMS has heard from stakeholders” to change or improve the ACO program, without disclosing what CMS might actually do in response to any of those recommendations. The list includes changes to basing, benchmarking, beneficiary attribution, advance payments, fixed prospective budgets, moving to full capitation, more options to move to fuller risk, revisiting the quality measures, access to Part D and Medicaid data, and more support for patient engagement such as beneficiary incentives. Pham did end her presentation with the announcement that there would be “lots” coming from CMS on ACOs in the coming months, including a new proposed rule on the Medicare Shared Savings Program ACOs.

However, the two data points that were most memorable was first, CALPERS’ Ann Boynton reminding everyone that while CALPERS’ savings of $6 million a year on more efficient and effective joint replacement surgeries is significant, it doesn’t make a dent in the $21 million a DAY that CALPERS is spending on health care, i.e., a staggering $7.7 billion a year. According to Boynton, while ACOs and more integrated delivery systems are clearly part of the answer in bending the cost curve, “they can’t happen fast enough for us.”

And second, Monarch Healthcare’s Colin LeClair showed laudable savings ($6 million in 2012, $8.5 million in 2013) and quality improvements from Monarch’s Pioneer ACO but the quality outcomes achieved after two years still were less than half of what is already achieved from his same health care delivery system for Medicare Advantage patients. The question that no one seemed to ask, or have real answers for, was why provider and system behavior was still so starkly different in a managed care environment compared to “traditional” fee-for-service Medicare. Health plans (especially Medicare Advantage health plans) seem to have a strong argument that they can deliver better patient outcomes. The challenge for the future and sustainability of accountable care models is whether continuing to pay these health plans as intermediaries rather than creating and sustaining ACOs is the best investment.

Not surprising, the presentations and discussions that seemed to pique the most interest were about business-to-business relationships between large employers and health systems that explicitly excluded health plans. Conference attendees were riveted by the presentations from Boeing and Providence-Swedish about their partnership in Washington state, and from Intel and Presbyterian Healthcare in New Mexico. Providence-Swedish’s Joe Gifford described his health system’s role as now part of the Boeing’s supply chain. He described the future of health care as multi-channel, digital, and personalized. Intel’s Brian Devore noted how a one-stop, dedicated customer service phone line from Presbyterian Healthcare for Intel employees and families was an essential part of the partnership, emphasizing how “simple beats best.” Devore described Intel’s goals for the partnership as good member experience, evidence-based medicine, right time and right service, and lower costs. When asked whether these B2B arrangements were yet another sign that health insurance plans were going to be bypassed in health care delivery system reforms, Anthem’s Steven Scott noted wryly that if health plans like Anthem can’t adapt to the changing market and provide value, they should go out of business.

Earlier, a panel that included Charles Kennedy from Aetna’s Healthagen, Sam Ho from United Healthcare, and Sam Nussbaum from Wellpoint all sang similar tunes about their new accountable care projects and services. United Healthcare’s Ho said that health plans can provide leadership, population health experience, data analytics, partnerships to drive forward value-based payments. Wellpoint’s Nussbaum noted lines are blurring as health delivery systems are becoming insurers and insurers are becoming health delivery systems. Healthagen’s Kennedy noted that consumers have not been deeply engaged in ACOs and that ACOs still need to work on innovations in customer service.

The most provocative (and entertaining) presentation was by Athenahealth co-founder Jonathan Bush, who described U.S. health care systems and providers as stuck in the “upper right quadrant” syndrome of protecting and defending their past successes, with little ability to adapt, create, or innovate (in the lower left quadrant). He noted that such innovation, including constantly improving quality and reducing cost, has been happening outside of health care systems with procedures such as laser vision correction and clear orthodonic braces. Bush observed that health care systems cannot control, or buy up, what is emerging as the “healthcare biosphere” because patients are accessing health care in so many places: national chain pharmacies, big box superstores, their workplaces, schools. Bush then offered a vision of what success for health care systems and providers might look like: a goal to be so accessible and transparent that they are competitive in an OpenTable-like platform (where there is data about who the best restaurants are both by past reputation and current customer reviews). He noted that even if local hospitals are no longer needed as in-patient centers of care, they can become like local private wealth asset managers in banking, offering customized, patient-centered care coordination and referrals, able to access the best centers of excellence for whatever procedure needed through regional and even national agreements. As he quipped, the Cleveland Clinic can offer anyone excellent surgery, not just residents of Cleveland.

In prior years, presenters at this conference focused on their “discovery” of essential health care providers and systems outside of hospitals, physicians, and health plans. For example, many ACOs have discovered that they need improved coordination, and even partnerships, with skilled nursing facilities and long-term care providers. This year, there was a lot of discovery about the importance of patient engagement. Dartmouth’s Fisher referred to focus groups where only one in 59 Medicare patients knew that they were enrolled in an ACO. The health plan panel called patient engagement the “undiscovered country.”

University of California Berkeley’s Steve Shortell noted the growing evidence base that increased patient engagement is associated with improved quality outcomes. Shortell listed examples of patient engagement, including shared decisonmaking in care planning and treatment as well as involvement in the design and operation in health care delivery. Tools for increasing patient engagement include common training for care teams, motivational interviewing, use of patient experience surveys, collecting patient-reported outcomes; representation on quality improvement committees, and creation of patient advisory councils. Shortell concluded by urging a movement from asking patients “what’s the matter with you?” to asking “what matters to you?”

Breakout sessions that I attended highlighted other “accountable care” innovations happening in state Medicaid programs and as part of the rapid growth of private health exchanges. As Medicaid is expected to cover 94 million Americans by the year 2024, compared to 72 million Americans under Medicare that year, how accountable care models get integrated into Medicaid may ultimately be more important than current Medicare-driven models. State Medicaid programs are using section 1915b and 1115 waivers as well as State Innovation Model grants to implement accountable care. In Colorado, regional coordinated care organizations have enrolled 720,000 Medicaid beneficiaries (about half of the state’s Medicaid population) and achieved $30 million in savings (2% of the state Medicaid expenditure) in the past fiscal year. In Utah, 71% of the state’s Medicaid beneficiaries are now enrolled in accountable care organizations and the state achieved $17 million in saving in its first year.

Similarly, over 1.2 million Americans have now purchased their health care insurance in private exchanges sponsored by national employee benefits companies and health insurance companies. Accenture predicts that up to 40 million Americans will be using private exchanges by the year 2018. Many of the health insurance products offered on these private exchanges are accountable care organizations. For example, Medica’s private exchange offers four ACOs and one PPO network as its options in the Minnesota market.

In summary, while the initial enthusiasm about ACA-specific ACOs may have waned, and now been tempered by the lack of breakthrough actual results, the momentum towards partnerships, clinically-integrated delivery systems, management towards population health improvement, increased patient engagement, and new payment models that include shared savings and shared risk clearly continues forward. While specific “ACO” models may not survive, the triple aim of improved patient experiences of care, improved population health, and reduced total cost of care will continue to drive forward new business models and innovation in health care delivery systems.

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