Since the Affordable Care Act (ACA) became law in 2010 and brought the term accountable care organization (ACO) into the lexicon, healthcare providers nationwide have finally gotten serious about improving the quality and efficiency of the care they deliver. Denver-based SCL Health System has been carrying risk-based contracts for far longer than that. In this Q&A, Debbie Welle-Powell, vice president for accountable health and payer strategies at SCL, discusses how the organization has been preparing for and adjusting to the era of value-based reimbursement.
Compiled by Neil Versel, Contributing Writer
While the benefits of accountable care organizations (ACOs) look good on paper, many providers find the reimbursement risk too hard to handle. SCL Health System shares its strategies in this area.
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Since the Affordable Care Act (ACA) became law in 2010 and brought the term accountable care organization (ACO) into the lexicon, healthcare providers nationwide have finally gotten serious about improving the quality and efficiency of the care they deliver. Denver-based SCL Health System has been carrying risk-based contracts for far longer than that. In this Q&A, Debbie Welle-Powell, vice president for accountable health and payer strategies at SCL, discusses how the organization has been preparing for and adjusting to the era of value-based reimbursement.
Q: How did SCL get involved in what is now known as accountable care even before the advent of the ACA?
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A: We held a capitated contract with a delegated group, so we already at least had one valuebased agreement on a per-member, per-month arrangement for inpatient and outpatient cardiology services. Our employed primary care doctors have also been participating in an IPA (independent practice association) that has delegated risks from one of the carriers in the Medicare Advantage program. In 2008, one of our hospitals in Denver was chosen to participate in what was called the Acute Care Episode (ACE) demonstration program. We were testing bundling of Part A and Part B back in 2008 to 2011, and when that program ended, it was a natural step for us to go to Model 4 (prospective inpatient hospital stay) in the Medicare BPCI (bundled payments for care improvement) program with the advent of ACA.
Since then, we have secured a Medicare shared savings program (MSSP) in Montana, and we’ll soon hear about an MSSP for our health system in Kansas. We’re also in discussions with our two largest carriers in those markets on how we convert the existing fee-for-service system to a value-based model.
Q: It sounds like you want to get away from fee-for-service completely at some point. Is this accurate?
A: We know the migration from volume to value is essential to delivering care that is accountable and affordable. The value/ performance component to reimbursement truly addresses all three points of the Triple Aim — it incentivizes providers to improve patient outcomes, while lowering costs and improving patient satisfaction. We have developed a global contracting platform to address this migration, and we’re expanding our care continuum to include home care, long-term care, and other providers to more effectively address gaps in care. We currently manage approximately 610,000 patients under some form of risk-based contract.
Q: When you say platform, is that a strategy, guideline, or a technology platform for entering into risk-based contracts?
A: It’s a strategic platform that we will build the technology on. We’re building an organized delivery system that includes advanced IT tools, care coordination, and predictive modeling. This infrastructure will help us manage the care continuum involved in our risk-based contracts.
Q: How do you identify the appropriate level of risk to take on?
A: We started building our risk-based infrastructure in the early 2000s. We were doing global capitation, but when the market changed, we got out of it and went back to a fee-for-service model. Now we’re re-entering those value-based agreements with an eye toward adding the performance measurement tools to our infrastructure to effectively manage risk. We’re moving aggressively to add these capabilities.
Q: What role does business intelligence play in this initiative?
A: We partnered with a company called Lumeris to customize a technology platform that aggregates all of our claims data. We leverage this platform to aggregate and analyze claims data from CMS for the MSSP. We also run all of our self-funded (SCL Health employee) claims data through this system. This technology platform allows us to assess where care is delivered and the cost of care utilization. It also allows us to take a holistic view of our associate population. We have spent the past year really focused on this analytics platform to gain a better understanding of our gaps in care. As a result, we’ve identified several opportunities for improvement to our care management program.
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As we continue to develop our care coordination strategy, we realize it’s not always wise to be hospital-centric. The key to success is knowing who our members are and their disease states and driving better performance and outcomes to our entire patient population. Our current focus is on complex care, or transitional care. With care coordination, success is achieved by effectively engaging our members and providers. To that end, we’ve identified our patient populations, and we’re looking to bring on nurse liaisons to work in our outpatient practices, the ED, and other areas where we have heavy utilization. These are the areas where care coordination begins. We want to ensure the patients we treat in these areas are getting the care they need and that the appropriate care transitions occur (e.g., specialist referrals, hospital admissions, home care, etc.).
Q: How has your use of data analytics helped to improve your performance to date?
A: A few years ago, we analyzed the CMS data from some of our employed physicians in Denver who were part of the Pioneer ACO program. Through this exercise, we discovered that these practices were partnering with approximately 37 home care agencies. You can imagine the opportunity for us to improve performance and lower costs this discovery provided.
Data analytics technology is the starting point. These tools generate the actionable information that ultimately allows you to redesign systems and improve performance. However, identifying and isolating key performance indicators via analytics and actually taking action on them is an ongoing balancing act. For example, last year, we probably spent 70 percent of our time generating analytics and 30 percent of our time taking action and affecting positive change. This year, that ratio is closer to 50/50. Next year, we hope to spend the majority of our time on process and care improvement because we’ll have most of the analytic data at hand.
Q: What aspects of your infrastructure do you need to fine tune to optimize your value-based position?
A: I think we need to improve the risk stratification and predictive modeling components of our strategy. We have the analytics, but we now need to slice and dice this data more concretely. With each risk-based contract we take on in each market, we’re building on our experience and our infrastructure. We need to develop some of those traditional insurance, actuarial skill sets. When we were strictly involved in fee-for-service reimbursements we didn’t have to look at pharmacy claims or the claims from other ancillary providers. We were just concerned with the services we provided and ensuring we were reimbursed appropriately for those services. With value-based reimbursement, we need to assess our role in the entire care continuum, and that requires looking at the entire care cycle and the total spend. As a result, we need to get more sophisticated at actuarial services, risk modeling, and risk stratification. We need to be able to anticipate where care will occur and where the future issues may arise. We’re still in our infancy in this regard.
Q: How will you know that you’ve been successful?
A: We measure our success by looking at benchmark data today. It will be about making decisions about care redesign and then evaluating the membership, cost, and where the care occurs. Then, we’ll have to build that infrastructure to manage care coordination and be able to report that we’re actually moving the needle in the areas of cost reduction, quality improvement, and patient satisfaction.
One of our board-approved goals is to lower our medical spend for our associates. We’re tracking that PMPM (per-month, per-member) metric and reporting on it every six months. It’s not just about lowering the expense; it’s really about improving care or understanding. If there are increases, why? Are there appropriate increases, or are we seeing a rise in higher acuity because we have more cancer patients than we had before? It’s all about getting to the root cause of the increase and responding appropriately to improve.
Since the Affordable Care Act (ACA) became law in 2010 and brought the term accountable care organization (ACO) into the lexicon, healthcare providers nationwide have finally gotten serious about improving the quality and efficiency of the care they deliver. Denver-based SCL Health System has been carrying risk-based contracts for far longer than that. In this Q&A, Debbie Welle-Powell, vice president for accountable health and payer strategies at SCL, discusses how the organization has been preparing for and adjusting to the era of value-based reimbursement.
A: We held a capitated contract with a delegated group, so we already at least had one valuebased agreement on a per-member, per-month arrangement for inpatient and outpatient cardiology services. Our employed primary care doctors have also been participating in an IPA (independent practice association) that has delegated risks from one of the carriers in the Medicare Advantage program. In 2008, one of our hospitals in Denver was chosen to participate in what was called the Acute Care Episode (ACE) demonstration program. We were testing bundling of Part A and Part B back in 2008 to 2011, and when that program ended, it was a natural step for us to go to Model 4 (prospective inpatient hospital stay) in the Medicare BPCI (bundled payments for care improvement) program with the advent of ACA.
As we continue to develop our care coordination strategy, we realize it’s not always wise to be hospital-centric. The key to success is knowing who our members are and their disease states and driving better performance and outcomes to our entire patient population. Our current focus is on complex care, or transitional care. With care coordination, success is achieved by effectively engaging our members and providers. To that end, we’ve identified our patient populations, and we’re looking to bring on nurse liaisons to work in our outpatient practices, the ED, and other areas where we have heavy utilization. These are the areas where care coordination begins. We want to ensure the patients we treat in these areas are getting the care they need and that the appropriate care transitions occur (e.g., specialist referrals, hospital admissions, home care, etc.).
