State Roles in Promoting
Accountable Care Organizations
Anne K. Gauthier
Senior Program Director
National Academy for State Health Policy
State Health Research and Policy Interest Group
Academy Health Annual Research Meeting
Seattle , WA
June 11, 2011
1
Overview
1.
2.
4.
5.
Context
State Roles in ACO Development
State Opportunities in Federal Health
Reform
Concluding Themes from States
2
Why States are Looking to
Promote ACOs — Better Value!

States are seeking better value in health care

Fragmentation and is pervasive in health care systems

ACOs are a promising means of health system reform

States have a substantial role as payers, regulators, & purchasers
of health care

States are seeking systematic responses for their vulnerable
populations

States are well-positioned to promote models that address
community-level needs and infrastructure
3
What is an ACO?

ACOs take on a variety of forms

Key principles:

Payment reform that promotes value

Includes shared savings model based on targeted savings using a global,
prospective, budget

Performance measurement using timely and accurate data allowing for
quality and cost accountability

Delivery system reform that promotes integrated, organized
processes for improving quality and controlling costs
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Our Research

On the Road to Better Value: State Roles in Promoting Accountable
Care Organizations

Purpose of report:



Discuss the levers, strategies, and
resources being used by states to
support ACOs
Encourage collaboration among states to coordinate initiatives
Stimulate consideration of ACOs at the state level

Profiles from 7 states: CO, MA, MN, NC, OR, WA, VT

Structured interviews with 14 key state policy makers, ACO national
thought leaders, & health care providers

Updated from additional contact after structured interviews
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State Roles in ACO Development:
Key Components
Data
Design and promotion of new payment models
Accountability measures
Identification and promotion of systems of care
Support for a continuum of care &
the medical home model
States play a critical role in each of these
key ACO components
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State Roles: Designing and
Promoting Data

Unique capability of states to gather, analyze &
share data that cuts across providers and payers

States are providing leadership & funding to develop
new data capabilities


Ex. 6 states using role as data-broker to develop multipayer
databases (Ex. MA Massachusetts All-Payer Claims Database)
State health IT/HIE development

States are at the data frontline thanks to the American
Recovery and Reinvestment Act (ex. Regional Extension
Centers)
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State Roles: Designing & Promoting
New Payment Methods

ACOs must develop global budgeting across providers and
payers that addresses population health care needs

States are…

Convening stakeholders under the “state actions”
doctrine to promote new payment methods

Piloting, testing, and funding payment reform (ex. WA
Accountable Care Organization Pilot Projects)
State Actions
Doctrine:
permits some “anticompetitive”
activities, if actions
are:
1)in furtherance of
a clearly articulated
state policy, and
2) actively
supervised by the
state.

Using their purchasing power as purchasers of
Medicaid, state employer coverage, and other
programs (ex. OR Health Authority)

Leveraging their legislative authority (ex. NC enhanced primary care case
management system)

Engaging Medicare as a payer (ex. VT Advanced Primary Care Demo)
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State Roles: Fostering the Use of
Accountability Measures


The ACO model may provide a framework in which to
measure value across systems and for identified populations
States are…

Promoting accountability through statewide reporting requirements
(ex. MN “Provider Peer Grouping”)

Using state purchasing power to formalize accountability standards and
measures (ex. CO Performance-based Medicaid contracts)

Convening stakeholders to develop measures (ex. OR Health Incentives
and Outcomes Committee)

Using pilot funding to tie standards and core competencies to provider
funding (ex. VT: adaptation of NCQA medical home standards for use in ACO
initiative)
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State Roles: Identifying and
Promoting Systems of Care

States are using a
continuum of strategies
to identify and/or foster
ACOs

To best foster systems of
care, states and ACOs must
consider:

Critical mass

Attribution
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State Roles: Supporting a Continuum of
Care and the Role of Medical Homes

Primary Care is at the heart of accountable care

PCMHs & ACOs are not mutually exclusive nor are they
mutually dependent—there are synergies

ACO savings can be reinvested
in the community

Accountable care model
seeks to create “systemness”
beyond the medical home
Medical home initiatives are a diving off point for
state creation of ACOs. Policymakers in 6 of the
study states plan to build off of elements of their
medical home initiatives in ACO development.
ACOs
P
C
M
H
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Federal Health Reform and State
Opportunities for ACO Development

The Accountable Care Model and the
Affordable Care Act


Center for Medicare and Medicaid Innovation
Medicare shared-savings program (Notice
of Proposed Rule Making released
03/31/11)





Pediatric ACOs
States can leverage interested organizations and providers
States can provide input into the regulatory process
Exchanges provide opportunities for states to promote ACOs
Health information technology and meaningful use can be
tools for payment reform and quality
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Key Themes on State Roles in
ACO Development

Build on the foundation of other state health reform
initiatives

Look for community-based and regional opportunities

Establish pilots to test models and build a core

Use legislation as a tool to develop efforts

Build stakeholder support

ACOs are not a “one-size-fits-all” model
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Thanks to…
Kitty Purington
Policy Specialist, NASHP
Shivani Patel
Research Assistant, NASHP
Christina Miller
Research Assistant, NASHP
For further information…
Purington, K., Gauthier, A., Patel, S., Miller, C., On the Road to Better Value: State Roles
in Promoting Accountable Care Organizations,
CMWF/ NASHP publication, February 2011
Anne Gauthier
Senior Program Director, NASHP
agauthier@nashp.org
http://www.nashp.org
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