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Health Affairs: Most ACOs’ IT Infrastructures Remain Immature

October 7, 2016
by Rajiv Leventhal
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Although commercial accountable care organizations (ACOs) are better structured to support delivery system reform and achieve performance benchmarks than non-commercial ACOs, most ACO delivery systems remain at a nascent stage, according to a report published in the October edition of Health Affairs.

The authors of the report—which was funded and supported by the Commonwealth Fund—from Harvard, University of California, Berkeley, Dartmouth and elsewhere, looked at data from national surveys of 399 ACOs, examining differences between the 228 commercial ACOs (those with commercial payer contracts) and the 171 noncommercial ACOs (those with only public contracts, such as with Medicare or Medicaid). The data showed that commercial ACOs were significantly larger and more integrated with hospitals, and had lower benchmark expenditures and higher quality scores, compared to noncommercial ACOs. Among all of the ACOs, there was low uptake of quality and efficiency activities.

However, the authors noted, commercial ACOs reported more use of disease monitoring tools, patient satisfaction data, and quality improvement methods than did noncommercial ACOs. Few ACOs reported having high-level performance monitoring capabilities. About two-thirds of the ACOs had established processes for distributing any savings accrued, and these ACOs allocated approximately the same amount of savings to the ACOs themselves, participating member organizations, and physicians. Overall, ACO delivery systems remain at a “nascent stage,” the report stated.

Over the past four years there has been a substantial increase in the number of ACOs, with some policy makers expecting the number of beneficiaries attributed to ACOs to exceed 100 million at some point in the next five years. But, as the report’s authors noted, while much attention has been focused on ACO performance outcomes, there is less information on how ACOs are internally structured to support delivery system reform and achieve performance benchmarks.

The report drilled down on three specific areas to better understand the type and extent of organizational transformation that is occurring within ACOs: the ability to gain control of external resources that may be diffusely distributed across or held by multiple other organizations; transforming care is to effectively engage providers and patients in new models of service delivery; and their use of robust IT systems.

The results showed that commercial ACOs are much more likely than noncommercial ACOs to include one or more hospitals (41 percent vs. 19 percent) and to be jointly led by physicians and hospitals (60 percent vs. 47 percent). Commercial ACOs also had lower expenses per Medicare enrollee ($10,000 vs. $12,000) and slightly higher overall quality-of-care scores.

Also, commercial ACOs tended to be more active in tying physician compensation to quality incentives, although overall only half of ACOs reported even monitoring financial performance at the physician level. Commercial ACOs were also more likely to tie specialists’ compensation to quality metrics.

What’s more, so far, ACO uptake of quality improvement activities has been modest. For instance, even among commercial ACOs only about 60 percent provide clinical-level performance feedback or use patient satisfaction data for quality improvement. Only around 30 percent reported well-established chronic care programs.

And, despite being critical to effective health care delivery system reform, ACOs face major health IT challenges. Just over 30 percent of commercial ACOs use a single electronic health record (EHR) system; among noncommercial ACOs, not even 20 percent use a single EHR system. Few ACOs reported being able to effectively integrate patient information between providers.

The big picture takeaway, according to a Commonwealth Fund analysis based on the authors’ reporting, is that noncommercial and commercial ACOs need to make major investments in critical infrastructure if they are to support delivery system reform. In particular, this would entail coordinating quality improvement activities and related financial incentives for physicians. At the same time, the researchers noted that the immature state of most ACOs’ information technology platforms may substantially complicate such efforts.

“ACOs are early in their evolution and many organizations currently lack essential building blocks to bring about desired improvements in quality and efficiency. Care should be taken to ensure that public policies support organizations in overcoming these barriers,” the report concluded.