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One of the patients in Doug Arnold’s new medical network received care from 99 different health care providers in the past three years, costing Medicare $375,000.
And although that care might not have been optimal or cost-effective, from a financial perspective, no one in the health care system had an incentive to do things differently.
“In a case like that, this person or their family members are just left to deal with all these providers on an episodic, uncoordinated basis,” said Arnold, CEO of a Middletown-based group of doctors known as MPS ACO Physicians.
The group’s mission is to change that. It’s part of a broader effort to transform the way health care is paid for and delivered, to tamp down on the nation’s massive health care tab by making the disparate pieces of the health care system work together to avoid the gaps that threaten patients’ well-being. The goal is to build a system that will reward those who keep patients healthy and out of the hospital, rather than those who simply deliver more care.
Those involved say it has the potential to revolutionize health care. That is, if the details can be worked out.
“The incentives now are really to have teams of doctors and other providers ... working together and sharing information to try to keep people as well as can be,” Arnold said. “There’ve never been incentives before to do that. I think it’s pretty revolutionary.”
MPS ACO Physicians is one of a handful of Connecticut-based medical networks known as Accountable Care Organizations, or ACOs, an initiative for Medicare patients created by the federal health reform law. Private insurers are pursuing similar concepts in contracts with medical providers.
Right now, health care runs on a fee-for-service basis. Doctors and other providers get paid for seeing a patient, administering a treatment or performing a procedure. They generally don’t get paid for talking to a patient on the phone or coordinating efforts with their patients’ other doctors.
The new models in Connecticut are still built on a fee-for-service system, for now, but allow providers to make additional money if they can contain the amount of money spent on their patients’ care while still meeting quality targets.
“We think that the fee-for-service core isn’t the right financial incentive, but it’s going to take some time for us to get away from it,” said Dr. Peter Bowers, the lead medical director in Connecticut for Anthem Blue Cross and Blue Shield. The insurer recently announced accountable care-type contracts with two major physician groups and anticipates having them with 25 percent to 30 percent of in-network primary care doctors by the end of the year.
Angela Mattie, chairwoman of Quinnipiac University’s department of healthcare management and organizational leadership, said the policies behind the new models are here to stay. But putting them into practice remains a challenge, she said.
“I think it’s going to be an evolving process,” she said. “I think we’re going to have a lot of false starts. We’re going to have a lot of good starts. We’re going to have a lot of innovators. We’re going to have a lot of failures. It’s not going to happen overnight.”
The implications are significant.
Some people worry the new payment structures could encourage providers to avoid caring for sicker patients or to offer less care.
The move toward “accountable care” is a major reason many physicians in private practice are looking to , and why the larger organizations are looking to join forces with them.
And, if successful, the new models could mean fewer patients spending time in the hospital, potentially requiring one of the costliest and most powerful parts of the health care sector to rethink its business model.
'The whole person'
Five years ago, Shelley Dietz needed help. Her father had Alzheimer’s, and when her mother got sick or went to the hospital, it would fall to Dietz to care for her father. He couldn’t be left alone, but Dietz worked full time, and she didn’t know what resources were available to help.
Lapses in care are often the culprit when a patient ends up back in the hospital, said Dr. James Cox-Chapman, ProHealth’s chief medical officer. Patients getting out of the hospital are at risk for significant confusion about how to take care of themselves, particularly if their medications have been changed, but many aren't in touch with a health care provider immediately after being sent home.
So ProHealth aims to reach out to all its patients leaving the hospital to make sure they know why they were admitted, what medications they should be taking, what signs and symptoms to watch for, and whom to call if there are problems. Patients are also to have a follow-up visit.
In many cases, they find problems, like a patient who should be getting home care but isn’t, or oxygen that hasn’t been ordered. The provider who called can help ensure those gaps get fixed.
Addressing those kinds of gaps is a key part of the new models. Anthem, for example, could tell a doctor that his patient with hypertension didn’t fill a medication, Bowers, the medical director, said, and that could lead the doctor to follow up and make sure any problems are addressed.
“Now the docs are doing the right counseling,” Bowers said, but no one gets the data to see whether the patient follows through.
Questions remain
The Medicare ACOs in Connecticut have three-year agreements. After that, the financial model is expected to be adjusted.
And there are other uncertainties. For one, who should be in charge of the networks? A key goal is to keep patients from needing higher-cost care, such as hospitalization. So is there a conflict if a hospital system is in charge of the model?
“If you are running a hospital today, one of the first things you do every day is look at your daily census report,” showing how many patients are in the hospital, said Kupec, from St. Francis HealthCare Partners. “From an ACO perspective, our joke is the only good census is a zero census, because our job is to keep people out of the hospital.”
In the St. Francis ACO, half of any payments received for saving money will go to the hospital, helping offset losses that could come if fewer patients end up hospitalized.
Ultimately, Kupec predicted, patients will increasingly be treated in less intensive settings, leaving hospitals with fewer but sicker patients.
Dr. Patrick Carroll, medical director for Hartford HealthCare’s ACO, said some changes align with hospitals’ interests, such as focusing on reducing readmissions. But, like Kupec, he said he expects there to be broader changes in what hospitals do.
“Hospital systems probably have too many beds nationally, so eventually we’re going to probably re-examine the inpatient focus of hospitals,” he said. “They’re already doing this. They’re moving many of the services to the ambulatory settings. It’s a fundamental transformation of the health care system.”
Those running ACOs led by physician groups say there are advantages to having the models run by organizations other than hospitals.
“On the one hand, hospitals do have a much more expensive infrastructure to maintain,” said Cheryl Lescarbeau, ProHealth's vice president of clinical performance and marketing. “On the other hand, they’ve got direct control over the highest-cost component of medical care. They’re very well positioned in some ways and in other ways they’re compromised because they do have that expense.”
Other people, particularly those who advocate for people with serious medical needs, worry that making health care providers responsible for the cost of patients’ care could give them incentives to deliver less care or avoid seeing patients with more complex needs.
And some people find the concept reminiscent of managed care from the 1990s, although those involved say there are differences, including the ability now to track patient outcomes and requirements that providers meet quality targets in addition to saving money.
The Yale New Haven Health Care System isn’t participating in any of the Medicare accountable care programs, but is exploring different payment and delivery system changes.
Dr. Robert Nordgren, Yale New Haven’s senior vice president and CEO of an affiliated group of providers called Northeast Medical Group, said it’s hard to predict which model will ultimately endure. But he said data from across the country suggest that health systems using accountable care models can slow the growth of health care costs or bring down spending. And that’s important, since there’s little money available to sustain continued growth in health spending.
“I think it’s difficult to say exactly what is payment going to look like” in the future, he said. “But I think that having a system that’s fully fee-for-service is going away.”
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