Washington, D.C. – Health and Human Services (HHS) recently released news of the formation of 123 new Accountable Care Organizations (ACOs) in Medicare across the nation, including one new addition for Rhode Island.
Katherine Sebelius, Secretary of HHS, in December made the announcement, noting that the newly formed and developing ACO network is expected to provide approximately 1.5 million more Medicare beneficiaries with access to high-quality coordinated care.
“Accountable Care Organizations are delivering higher-quality care to Medicare beneficiaries and are using Medicare dollars more efficiently,” Secretary Sebelius said in a press release. “This is a great example of the Affordable Care Act rewarding hospitals and doctors that work together to help our beneficiaries get the best possible care.”
Expanding the Rhode Island Network
Rhode Island’s newest ACO addition , Health Choice Care, LLC, (HCC) was on the list.
Health Choice Care LLC joined other newly formed ACO’s in Rhode Island, including Coastal Medical, a collaboration of Coastal Medical physicians and UnitedHealthcare, who formed an ACO in March.
Health Choice Care, LLC expects to service providers in Rhode Island, Florida and Missouri, according to Kevin Kearns, spokesperson for the health information technology and management organization.
“Providence Community Health Centers (PCHC) is our only participating provider in Rhode Island. Those patients that are going to Providence that have been attributed to us – they can go anywhere in Rhode Island or to any Medicare provider, but the only provider we are working directly with is Providence Community Health Center,” said Kearns. “They’re going to work with other providers; they’re going to work with the hospitals; they’re going to do what they can do to help manage the quality care and get the cost efficiencies. That’s their job working with their partners.”
Why Missouri and Florida?
Servicing health care providers in Florida, Rhode Island, Missouri, Utah, New Mexico, Kansas and Hawaii, the company first looked to form an ACO in Florida, traditionally its base, according to Kearns. Realizing they had an exceptional product to offer in its established information technology (IT) database, the organization decided to reach out and open participation up to its key members who had significant Medicare populations.
When we talked about it in Florida first, doing an ACO, we found we were in a good position because we already had a good handle on data, health data, meaningful use, Kearns said. “We had an incredible asset that most ACO’s that were starting out don’t have. They don’t have the backbone, the IT. We do.”
Although servicing multiple states, there are separate databases stored in a common IT warehouse.
Rhode Island joins providers in Florida and Missouri in forming the new health care provider organization. The organization expects to service approximately 17,000 members. Specific numbers for Rhode Island were unavailable, but Kearns estimated 1,500 possible members.
What is an Accountable Care Organization?
An ACO is a group of healthcare providers who agree to provide quality medical care to a specific group of Medicare beneficiaries while assuming accountability for the quality of that care and associated costs. According to the HHS release, Affordable Care Act provisions have a substantial effect on reducing the growth rate of Medicare spending.
“Growth in Medicare spending per beneficiary hit historic lows during the 2010-2012 period, and this trend has continued into 2013. Projections by both the Office of the Actuary at CMS and the Congressional Budget Office estimate that Medicare spending per beneficiary will grow at approximately the rate of growth of the economy for the next decade, breaking a decades-old pattern of spending growth outstripping economic growth. ”
“We do a number of things, but most importantly we have helped with the implementation of the information technology which was the billing system, the practice management and now the medical records – electronic medical records and electronic dental records,” said Kearns. “So we have about 40 health centers across the country all on one physical database that we helped deploy. We are a not for profit organization and we exist solely for the benefit of our member health centers. ”
Winning formula for patients and providers
According to Kearns, the newly formed ACO networks provide a winning formula for patients, providers and the healthcare system overall. ACO’s are responsible for creating a support system for providers that allows for a more fluid and efficient system of providing quality care to its members, with the intention of reducing costs to all.
“From the strategic perspective this is the right thing to do. Moving from a strictly fee-for-service volume base to more of a value approach, we believe it’s the right thing. Whether its meddicare, Medicaid exchanges or whatever, to get our standards focused on improving quality, reducing costs, improving the patients’ experience, where they can benefit by the cost savings and enhanced quality, it is the right thing to do. Irrespective of how successful this this aco is with medicaire, it’s the right thing to do and our centers believe they need to be there strategically for the future,” said Kearns.
As far as expectations, Kearns said HCC, had a cost savings target of 3-4 percent.
“If we can save 3-4 percent of the benchmark costs and obviously keep the quality up well above the 50th percentile; if we can reduce costs by 3-4 percent, then we believe we’ll cover our operating costs for the ACO and return a significant amount of funding back to the community health centers,” he said.
The organization is hoping to have an idea of how well their management system is working by the end of the year.
Merrill Thomas, Executive Director at PCHC had not been reached at the time of this post.