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Smashing Old Boundaries: Phoenix's Banner Health Network Moves Forward with Aetna on Accountable Care

March 5, 2013
by Mark Hagland
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The leaders at the Phoenix-based Banner Health are learning a lot already, as they collaborate with a division of health plan behemoth Aetna to create an unusual initiative that incorporates IT development into payer-provider contracting

Banner Health, an integrated health system based in Phoenix, operates 23 hospitals and other healthcare entities in seven states. In Arizona, Banner Health leaders have created the Banner Health Network, expressly designed to take on accountable care organization (ACO) development both through the Medicare Shared Savings Program (MSSP) for ACOs, and via collaborative contracting with health plans in Arizona.

On the federal side of the ledger, Banner Health Network is one of the pioneer ACOs working with the Medicare program in the Pioneer ACO Program. On the private side, leaders at Banner Health Network have been building a groundbreaking collaborative initiative with the Hartford, Conn.-based Aetna, through its Accountable Solutions from Aetna division. Unusually, that division has developed and is implementing a range of IT solutions to support such collaborations, meaning that Accountable Solutions from Aetna is essentially at the same time both a contracting entity for one of the nation’s largest health plans, and an IT vendor.

On March 5 at the HIMSS Conference, being held at the Ernest N. Morial Convention Center in new Orleans, Tricia Nguyen, M.D., chief medical officer of Banner Health Network, and Bruce Henderson, head of integrated solutions at Accountable Care Solutions from Aetna, sat down with HCI Editor-in-Chief Mark Hagland, to talk about their unusual collaboration, and what they’ve learned so far from it. Below are excerpts from that interview.

To support this collaboration, as well as several others with health systems around the country, you and your colleagues at Aetna have developed or acquired a number of IT solutions in such ACO-related areas as population health management and business analytics, as well as helping your provider partners to strategize around such areas as plan design, correct?

Bruce Henderson: Yes. Everything that we’ve created technologically is encompassed in our partnership with Banner Health Network. Banner Health is a very progressive health system, very forward-thinking, and were looking for a partner to help them transform the model of care and truly change things towards quality and efficiency.

Bruce Henderson

From the Banner Health and Banner Health Network standpoint, how did this all come about?

Tricia Nguyen, M.D.: This is probably the deepest payer-provider partnership that we have. We are also in a joint venture with Blue Cross Blue Shield of Arizona—we sold them half of our Medicare Advantage Plan, because we wanted to broaden our Medicare Advantage network. But we have a very different and unique collaboration with Aetna. We signed the contract with Aetna in November 2011 to get away from a fee-for-service model and towards a quality-based model. And that opened the door for us to bring the core competencies of a health plan to be able to do data analysis and claims analysis and the ability to manage populations, to a provider that wanted to do population health. Banner could have done this more individually and purchased individual elements like reporting solutions, population registry solutions, an analytics engine, and an HIE [health information exchange] capability, and chosen to integrate all these disparate data sources, itself. But we chose to purchase the ActiveHealth Technology Set from Aetna, which provides a one-stop shop of solutions for us.

The reality is that EHRs [electronic health records] don’t have the capability to integrate claims data together with the data we have as a provider. So this gave us the opportunity to use a single integrated suite of solutions to work with a partner like Aetna. That having been said, Aetna will not see any payment from us for their technology and services unless they can help us achieve savings. No vendor downstairs [in the HIMSS13 exhibit hall] will do that [and that is significant]. We recognize each other’s strengths. So this is a payer-provider-vendor partnership, and it’s unusual.

Tricia Nguyen, M.D.

Henderson: We are also transforming ourselves. This is a new business model for Aetna. It’s a new approach to the market, it’s new technology, new services, but our senior leadership and board are absolutely committed to facilitating the transformation of the industry, not only through these relationships with providers, but also internally within our organization, to adapt to the new future.

How did you convince the clinicians at Banner, but most especially the most recalcitrant physicians, to engage in this area and move forward with you on an accountable care collaboration with a health plan?

Nguyen: That’s why we developed Banner Health Network, with 12 acute-care hospitals, and a network of 2,600 providers: Banner Medical Group, an owned medical group that employs one-third of those providers, as well as an a IPA [independent practice association] and a PHO [physician-hospital organization]. So we formed Banner Health Network with strong physician representation on its board, to drive one care model, one service model, and one financial and incentive model for the physicians. The financial arrangements we have with Aetna will be different from those we have with Cigna or other payers in our market.

In other words, you consciously chose to ask physicians to agree to put themselves in the position of having more ‘skin in the game’?