How Do Accountable Care Organizations Work?

Posted on by
image_pdfimage_print

In my last post I gave an overview of what Accountable Care Organizations (ACOs) are.  Before I start to explain the care coordination strategies they commonly use,  I’d like to go a little deeper into how an ACO has patients (Medicare beneficiaries) attributed to it and where savings can be found while maintaining quality.

Beneficiary Attribution

Let’s consider an ACO formed by a primary care medical group.  These physicians practice primary care and would include family practitioners, internists and, since the patients we’ll talk about are Medicare beneficiaries, geriatricians.  Medicare would look at all the claims for services of any patient the medical group took care of within the past several years (usually 3).  Medicare determines from which physician the patient got most of their primary care services & attributes that patient to that physician.  A key point to remember is that even though a Medicare beneficiary is attributed to a specific primary care physician, the patient can see any physician they want.  The patient is not a “member” of the ACO.  However, since that patient is attributed to the ACO, all their health care services become the responsibility of the ACO to coordinate.  The patient has all the freedom to go to any physician in the country who accepts Medicare for their health care needs.  They are still regarded as being in the traditional Medicare program.

Cost Benchmark

Once Medicare has attributed their patients to the ACO, it calculates a cost benchmark that will serve as the target for the ACO.  The benchmark is derived by a formula that looks at the previous three years of costs for the attributed beneficiaries and is adjusted for inflation.  If the ACO is able to provide quality care as measured by 33 quality measures and keep costs under the benchmark they will share in a portion of the savings with Medicare.  For most ACOs there is no penalty if costs are over the benchmark.  The ACO is not responsible for paying the care providers.  Medicare still does that.  Remember, the costs are all the costs (except Part D drug costs) for the attributed beneficiaries, including hospitalizations, tests, surgical procedures and physician charges.

Cost Reduction Opportunities

So where will the savings come from?  There are several main areas – areas that won’t compromise quality, but rather increase it.  Our system of health care delivery is hardly an efficient one.  Important clinical information is often not transmitted promptly to the next person involved in a person’s care.  Consequently, tests are often repeated unnecessarily.  More importantly misunderstandings and miscommunications can result in complications and poor clinical results that require more services which just add to the costs.

In my next post I’ll talk about the opportunity surrounding hospital discharges as an example of how care coordination can improve quality and lower costs.

For Your Health – Dr. Bob

 

Making Your Exercise Plan

Posted on by
image_pdfimage_print

In an earlier post, Obesity & Health, I included this formula:

Formula For Weight Loss: Calories Out (Activity) > Calories In (Food Eaten)

In earlier posts we talked about the Nutrition side of this equation.  Now we’ll consider the activity part.  It makes sense that increasing your activity level can help you lose weight since you burn more calories.  Incorporating an exercise plan in your daily routine consists of making behavior changes and should be approached in the same way.

  • Choose an activity that you’d like to try.  A tool for determining Activity Calories on my website InsightsForHealth.com can help you learn how many calories you can burn with different activities.
  • Decide on your exercise goals and when you intend to reach them.  Goals:
    • Time of day you’ll exercise
    • Duration of each exercise session
    • How often you’ll exercise.
    • Identify the date you will begin to exercise.
    • Identify possible obstacles to starting your exercise program and ways to overcome them.
    • If there is any question about the safety of your proposed exercise program due to your age or health status, check with your physician before you begin.

I’ll talk more about your exercise plan in upcoming posts.  They will cover the following topics as you get ready to introduce an exercise program into your routine:

  1. Making Your Exercise Plan
  2. Benefits of Exercise
  3. Recent Recommendations for Healthy Adults
  4. Those Older Than 65 Or with Chronic Conditions
  5. Risks of Exercise
  6. Back to Exercise And Weight Loss
  7. Points to Remember About Starting Your Exercise Plan

For Your Health – Dr. Bob

Something New in Medicare Healthcare Delivery – The ACO

Posted on by
image_pdfimage_print

So, where have I been? Anyone who has written a successful blog will tell you that you need to publish often to attract readers.  It’s been months since my last post.  I apologize for the delay, but I’ve been busy working as the Medical Director for an Accountable Care Organization (ACO) since August and think some of my experiences can offer some insights about new developments in our health care system –  insights that everyone can use.  In this post, I’ll give you a brief overview of Accountable Care Organizations.

What is an ACO?  CMS through regulations found in the Patient Protection and Accountable Care Act is encouraging the formation of ACOs to address some of the problems in our health care delivery system through innovation that moves us from a fee for service to fee for value.  Here’s the definition from the Centers for Medicare & Medicaid Services (CMS):

“ACOs are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to the Medicare patients they serve. Coordinated care helps ensure that patients, especially the chronically ill, get the right care at the right time, with the goal of avoiding unnecessary duplication of services and preventing medical errors. When an ACO succeeds in both delivering high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the Medicare program.”

Through an application process, ACOs are designated by CMS.  They are focused on achieving the Three-Part Aim of:

  • Improving the experience of care
  • Improving the health of populations
  • Reducing per capita costs of healthcare

To make sure that quality is enhanced, ACOs must report 33 quality measures within the following 4 areas:

  • Care coordination & patient safety
  • Preventive health services
  • Care for at-risk populations
  • Patient & caregiver experience of care

In my next post I’ll talk about some of the opportunities for ACOs to improve how care is delivered for Medicare patients, many of which are applicable to the entire U.S. population.

For Your Health – Dr. Bob

The Affordable Care Act – Have You Read It Yet?

Posted on by
image_pdfimage_print

Well, have you?  With all the furor and debate these past several years I know you’ve heard about the Affordable Care Act (ACA), often called Obamacare.  Its full name is the Patient Protection and Affordable Care Act (PPACA).  What do you know about it?  Just the few sound bites that flood the media?  With the Supreme Court’s decision leaving it intact, the Republican Party is making its repeal the rallying cry for their bid for November’s Presidential Election.  Our country is divided on the issue, and yet, I would bet that the majority of Americans haven’t even read it.  They rely on what they have heard in the news or from their favorite commentator or politician.  The problem is that those messages are designed to be short & emotionally charged, yet ACA is, of necessity, quite broad.

Because your vote this November can be critical to the health of the healthcare system of the United States, I urge you to take the time to read through the law to understand it in more detail.  I have included a copy of the Affordable Care Act and the associated Health Care section of the Health Care and Education Reconciliation Act of 2010.  Just Click Here or the link on the right to open it in a separate window.

A couple of points:

  • The ACA is divided into 10 Titles followed by the Reconciliation section.  Think of the Titles as chapters.
  • The last Title of ACA contains all the amendments that were made to the original draft of the law and is entitled, Title X – Strengthening Quality, Affordable Healthcare For All Americans.
  • Title IX – Revenue Offset Provisions covers the sources of the money that will pay for the components of the law.
  • The Health Care and Education Reconciliation Act of 2010 reconciles the ACA with the Federal budget.
  • The ACA & the Reconciliation Act file available through the link on this blog total 974 pages.  References have been made stating that it is over 2,400 pages long.  This discrepancy is due in part to the fact that certain copies of it as it went through the legislative process were formatted differently and double-spaced.

Suggestions:

  • Rather than reading the law straight through, review the table of contents at the beginning.  This will give you a quick overview of the topics it covers.  Then you can start to read about the aspects of the law that are of interest to you.
  • I urge you to read Title IX that deals with Revenue Offset Provisions.  It includes requirements that health insurance companies, pharmaceutical companies & the makers of medical devices must pay billions of dollars annually based upon their market share.  It also limits the income of health insurance executives.  I think this Title is especially telling because it shows who has the most to lose with this law and may explain why people take the positions they do.

So, take the time to learn about the Affordable Care Act.  You’ll be surprised at what you’ll learn and be better able to judge the accuracy of the many statements about it that fill the media.

For Your Health – Dr. Bob

A Great Video on Hospital Charges

Posted on by
image_pdfimage_print

Shortly after publishing my last post, The $29,000 Appendectomy! (Brought to You by Cost-Shifting), my daughter e-mailed me a link to a video on the CNN website in which Dr. Sanjay Gupta gives some further insight about hospital charges and cost-shifting. As always, he did a terrific job, and I urge you to Click Here to check it out.

I’ve always admired Dr. Gupta’s interviewing skills and ability to clearly explain some complicated medical issues to his audience.

As always, I welcome your comments!

For Your Health – Dr. Bob