At a time when issues around taking on risk-based contracts are becoming more complex and challenging for physician groups, some physician organizations are moving ahead to lay the foundations for success in risk-based contracting, all of which require strong health risk assessment processes around broad covered populations, and the creation of care management and population health management strategies for the long haul.
But the pace of preparation for risk is accelerating rapidly now, as both federal healthcare policy mandates and opportunities are pushing physicians and their medical groups forward. Not only has the Affordable Care Act (ACA) mandated participation in its value-based purchasing programs for both physicians and hospitals; it has required hospitals to reduce avoidable readmissions. And now, with the implementation of the MACRA (Medicare Access and CHIP Reauthorization Act) legislation, and the MIPS (Merit-based Payment System) that is a part of MACRA, looming next year, even more pressure is being put on physicians U.S. healthcare system-wide. What’s more, the federal Centers for Medicare & Medicaid Services (CMS) continues to push physicians and hospitals forward, with its expanding mandates for bundled payments, first for total-hip and total-knee replacement surgeries, and more recently for heart attack and CABG (coronary artery bypass graft) care, for both hospitals and physicians delivering care in hospitals.
Meanwhile, the evolution of the Medicare accountable care organization (ACO) programs is proceeding apace, with physician groups and hospitals moving forward not only in the Medicare Shared Savings Program (MSSP) for ACOs, but also the Pioneer ACO Program and the Next-Generation ACO Program. And, of course, hundreds of ACO contracts between private health plans and providers are evolving forward at the same time.
In fact, the medical group world’s pioneers have been busy moving forward into uncharted territory, says Don Crane, president and CEO of CAPG—“the voice of accountable physician groups”—a national association of medical groups involved in accountable care organization (ACO) development and other risk-based contracts. “Among the key learnings,” Crane says, “is that taking on higher levels of risk and moving to professional and not just institutional risk, is being seen as a good thing,” among the leaders of the most innovative medical groups in the U.S. “Doing so improves the quality of care, results in higher quality scores, and higher bonuses. And so moving up in risk is something that has grown in the CAPG membership,” he says.
Healthcare Informatics Editor-in-Chief Mark Hagland interviewed Crane this summer as part of his reporting for the magazine’s September/October cover story on physicians and risk. Below are excerpts from their interview.
How many of your association’s member groups are involved in the MSSP and Pioneer ACO programs right now?
There are three of our member groups in the Pioneer program, and in the MSSP, around 12 or 15.
And ACO development work harmonizes naturally with the kind of work you’re helping your member groups participate in overall, correct?
Yes, that’s right. We’re in the business of advocacy, of course, in Sacramento, California, and in Washington, D.C. We were very active in advocacy work on behalf of physician groups in the run-up to the ACA, and in MACRA now, and in Medicare Advantage, and in all the advanced alternative payment models, and also the ACO programs. And to be clear, we’re very deeply involved in both advocacy and education, around all the alternative payment models and programs. And as we move forward nationally and expand, our efforts are expanding. We’re putting on seminars, webinars, etc., partnering with other entities, to help teach how to deliver coordinated care. We probably had more of our members and sooner, fully wired with their electronic health records [EHRs], than anywhere else in the country.
Getting EHRs implemented early on was absolutely necessary to do the managing of care, the encounter data transmission, but also, coding and getting paid in a world where your patients are all risk-adjusted, and your revenue goes up or down based on their acuity. So we’ve had fully installed EMRs across almost all of our membership for a long time, and are doing a lot of data mining and risk stratification, and outreach, and predictive modeling, and disease registries. The measurement and management of data has been very key.
Data and IT are of paramount importance. This movement from volume to value requires multiple competencies, all indispensable. One of them is IT: you just don’t take responsibility for a population and deliver care across the continuum without IT. You need a record with memory. And interoperable IT becomes critically important, because of the need to measure and manage data. How do you do well in pay-for-performance, which is pretty much baked into all the programs? Ecellent information systems and data analytics are essential for those trying to deliver the Triple Aim [the triple set of goals for improved patient experience, improved health status of populations, and reduction in the cost of care, that has been promoted for years by the Cambridge, Mass.-based Institute for Healthcare Improvement (IHI)].
What have been the key learnings so far emerging for the leaders of your member groups, around taking on risk in contracting?
One of the biggest key learnings has been that taking higher levels of risk and moving to professional, not just institutional, risk, has been seen as a good thing. It improves the quality of care, and results in higher quality scores and higher bonuses. And so moving up in risk is something that has grown in the CAPG membership. And another key learning has been that open networks really are a bear to work with. As we know, the ACO program is essentially an open network, it’s not closed. And the leakage is very high. All have done what they can to create stickiness and patient engagement, and such, but it’s difficult to do that against a backdrop that allows people to migrate everywhere. So the difference between an open and a closed network can’t be overstated. And more broadly, in our work with PPOs, you need to make that PPO a product so that that patient enrolls in it and there’s patient engagement and a psychology of connection. Where you have that, there’s engagement, and where not, it’s difficult.
We’re hearing that it’s been very hard to marry claims and clinical data. What have your member groups’ experiences on that challenge been so far?
There’s a constant discussion here about claims versus encounter or clinical data. You get more done with claims than you used to. Claims drive a lot of the quality and P4P work; it’s not as good as encounter data, but it’s more readily available. So there’s something to be said about ‘mere’ claims data. Particularly in a capitated world, though, encounter becomes all-important. And we are having challenges there. As premiums under the ACA are risk-adjusted from plan to plan, encounter data gets risk-adjusted. And so everything takes more work. So there’s a difference between those two categories of data.
Is it true that the commercial insurers are quicker in getting claims data back to the providers than Medicare is?
They’re both slow, fact. Medicare is slow. Everybody deals with dirty and slow data, but I wouldn’t necessarily say that there’s much of a difference. So I don’t really know. Now in terms of quality of data, you get claims data from CMS. From private plans, you get richer data, with hospital claims and pharmacy. There’s maybe more complete data. But groups and plans have never really shared data anywhere near where to how they should be doing.
What are some of the key things that CIOs and CMIOs need to do right now, with regard to all of this?
I think the short answer is MACRA. We now have a law of the land passed by an overwhelming majority in Congress. And MIPS starts soon. This is really transformative in terms of Medicare. We know that the vast majority of physicians will be in MIPS, and that will require them to manage and marshal data for pay for performance in ways they may never have in the past. They’re going to need to join groups, or buy resources available to IPAs. So I’ll just say, getting ready for MACRA is the biggest thing that CIOs, CEOs, and CMOs need to do. They’ll need to get that done.
The same is in terms of the transformed Stage 3 rule under the meaningful use program, that is now going to be a part of MIPS. So learning what’s in there will be critically important. But then learning how to do it, will be another thing. And were I a physician or group outside California, and I was staring at MIPS/MACRA and realizing that a big portion of my revenue stream might go up or down, I would join CAPG and learn from my peers on what are the best information systems to have, who are the consultants you want or need, how you incentivize all your physicians. Because in four months and about 5 days, your data is going to be measured. And if you’re in the bottom half of MIPS because you don’t have an EHR, you’re in trouble, buddy. You’re going to get a 4-percent penalty; and your provider competitor provider across the street is going to get a 9-percent bonus. And by years two and three, the competitive advantage that this will create, is going to be huge. The strong will get stronger and will the weak will be disadvantaged.
Overall, what are the couple few most valuable things your members have learned in the last couple of years?
Its’ been important to learn in the Medicare ACO program that the patients do not feel connected to groups, that they ‘leak out.’ And we’re talking about superior medical groups. All of a sudden, when 40 percent of their patients are going out of network to physicians with no connection to your network, you have no control over utilization and quality, so the costs go through the roof, you exceed your benchmark, and you lose network. So open networks are a huge problem for population health. We have for example right now our own proposal we’ve made called the third option—a global pay bill, H.R. 4581, pending in the U.S. House of Representatives. It describes a directly contracted model between CMS and physician groups. Our iteration creates a kind of point-of-service plan, with greater cost deductibles and co-payments if they go out of network. That’s in proposed legislation now. They’re talking about a five-year pilot. So that’s an important learning.
Another generalized important learning is as follows: the world is paying physicians less. There are no real increases in Medicare anymore; in Medicaid, which is MediCal here in California, the cuts are never being restored as reimbursement. So the option that remains is organized systems in population health being prepaid or budget-based. And that doesn’t just produce the Triple Aim. It produces higher satisfaction for physicians; they like their jobs better. And if you look at the tea leaves and see that Healthcare Partners was sold for $4.4 billion and such, there’s good money to be made in this method of payment. I mean, you can lose your shirt; physicians and physician groups did years ago in California; but physicians in California are learning. So don’t fear this movement from volume to value; instead, figure it out and do well in it.