Mostashari, Gilfillan Highlight the Spillover Effect of ACOs Across the Entire Healthcare System

The accountable care organization (ACO) movement may be slow, but it is having an effect that is rippling throughout the healthcare system, said Farzad Mostashari, MD, CEO and cofounder of Aledade, during a session at the spring 2018 conference of the National Association of ACOs.

Mostashari added that he is proud of the ACO movement, which has come into question with results, such as those from Avalere, finding that the Medicare Shared Savings Program (MSSP) ACOs have fallen short of projected savings estimates. He disagrees with people who say the results have so far been underwhelming with the explanation that benchmarks haven’t been a good representation of the benefit being derived from the program.

“I think that the quality improvements and the quality gains have been underappreciated. I think that the multiplier effect, the spillover effects on Medicare and other populations, has been underappreciated,” he said. “I think it gets better over time. Let’s not throw out the baby with the bathwater here.”

Mostashari provided 4 policy predictions for where ACOs are going (from most likely to happen to least likely):

• Time limits on how long ACOs can stay in 1-sided risk. Mostashari is concerned that ACOs will be dropping out instead of pushing forward if they are forced into 2-sided risk. The week after the meeting, NAACOS released survey results that showed 71% of respondents who were Track 1 ACOs who would be required to move to a 2-sided risk model in 2019 said they were likely to leave the MSSP.
• Improvements to the regional benchmark. It is not uncommon for ACOs to receive the final reconciliation report or the benchmark and find they are off from what they expected. “And that doesn’t give people a lot of confidence to move to 2-sided risk,” he said. “More predictability will make people feel a lot better than moving to more risk.”
• More enforcement against information blocking. This is one prediction that may come true. Between when Mostashari had put together the list and when he presented at the meeting, CMS proposed making sharing data a requirement of Medicare participation.
• New alternative payment models (APM) more in line with Medicare Advantage (MA). This would help bring some more predictability to the ACO program.

Richard Gilfillan, MD, CEO of Trinity Health, explained that his organization views expansion of ACOs as a way to be a patient-centered health system that looks at populations and at individuals, rather than just services being paid for.

Trinity has seen significant improvements on hospital safety and readmissions, he said, even though the cost savings haven’t been exactly where they would want them. However, he echoed what Mostashari said about the spillover effects of the program.

“Medicare annual spend is $200 billion less a year compared to the projections that were done in 2010 for the period of time from 2020 to 2030,” Gilfillan said. “I believe we have seen vast effects across the system.”

Gilfillan finished up by providing Trinity’s position on how to optimize ACO results, which included:

• Make all MSSP ACOs upside only at 80%. He suggested that instead of using “the risk hammer” to drive people where they don’t want to go, CMS should give people the opportunity to succeed, and if they don’t after a certain time, give the opportunity to another ACO.
• Eliminate the rebasing and quality ratcheting mechanism so there’s a predictable opportunity to be successful. He suggested that CMS think strategically about the savings in the future that will result from transformation.
• Drive all federal spending through APMs. This would affect MA, Medicaid managed care, the Federal Employee Benefit Program, the Veterans' Choice Program, and more.

“I urge people to not jump to conclusions of [ACOs] not working,” said Gilfillan. “It’s a longer journey than we thought, but it is moving along.”