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KLAS: Third-Party Vendors Outperform EMRs for Meeting Physician-Led ACO Needs

April 10, 2014
by Rajiv Leventhal
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Third-party accountable care organization (ACO) vendors are outperforming electronic medical record (EMR) vendors when it comes to meeting the needs of physician-led ACOs, according to the latest report from the Orem, Utah-based KLAS research.

Recent results from the first wave of Medicare ACOs show that a majority of those earning bonuses are physician-led. For some, this is a surprise considering that physician groups often lack capital and established care networks. To better understand the approach of physician-led ACOs and the vendors supporting them, KLAS interviewed 46 ACOs about their software. Providers gave feedback on product usage and performance as well as the products' abilities to meet certain ACO needs. The report includes products from Advisory Board, Allscripts, eClinicalWorks, Epic, GE Healthcare, Medecision, Milliman, NextGen, Optum, and Phytel.

According to the report, overall, EMR vendors are not ready for ACO prime time, rating on average 6.3 on a 9.0 scale for meeting ACO needs. The closest to being exceptions are eClinicalWorks and Epic, which rate 7.0 and 7.3, respectively. eClinicalWorks is the most used across all functional categories, while Epic offers completeness of data in more centralized ACOs.

Additionally, third-party vendors rate higher than EMR vendors in all functional categories, but they do so most notably in risk stratification. Sixty-eight percent of respondents use a third-party vendor, compared with 15 percent who rely on an EMR vendor. Advisory Board, MEDecision, Optum, and Phytel are the vendors most often deployed.

Among a diverse crowd of 25 vendors, only one—Optum—stands out in terms of adoption, which is used by four organizations. Only seven other vendors were mentioned more than once, and none of those were mentioned more than twice. Unlike EMR vendors, third-party vendors show little affinity for ACO type, the report stated. Most population health vendors are used across hospital partners, medical groups, and independent associations.

Without strong governance and a standard EMR, most independent associations rely on third-party tools and claims data. As a result, associations are least likely to take on higher-risk contracts, and most stick with low-risk managed security service providers (MSSPs). In contrast, medical groups with centralized management, standardized EMRs, and higher rates of employed physicians (as opposed to independent physicians) take on greater risks associated with Medicare Advantage and commercial health plans.

"With very few exceptions, EMRs are not meeting all ACO needs, causing many third-party products to be invited to the ACO discussion," said report author Erik Bermudez. "As we look at where healthcare is headed and the rapid growth in the number of physician-led ACOs, we see that this area will only increase in importance. We want to put a spotlight on the enabling technology within these ACOs."

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