Accountable Care Organizations:
Lessons from current practice
Julie Bynum, MD MPH
Assistant Professor
Dartmouth Medical School
Goals
• Describe brief history & current concept
• Describe development of our
“experimental model” of an ACO
• Discuss potential uses through evaluation
of current data
Vol 13, Issue 4, 43-57
Vol 13, Issue 5, 46-64
Variations in quality and spending
The Dartmouth Atlas
What is organizational accountability?
Levels of decision-making and potential strategic
levers
Research priorities (biology vs. clinical
practice)
Coverage policy
Performance measurement / Public reporting
Payment system reform
Recruitment / practice location decisions
Capital investment (hospital, outpatient)
Organizational structure (hospital, MD group)
Process management (QI, IT adoption)
Specialty certification
Graduate Medical Education
Continuing medical education
HIT for care and decision-support
Policy Environment
(e.g. payment system)
Local
Organizational Context
(e.g. capacity - culture)
Physician - Patient
Encounter
What can be done?
Levels of decision-making -- and potential strategic
levers
Where do these levers exist?
• In Washington, DC
• In State capitols
Policy Environment
(e.g. payment system)
Where do these levers exist?
• integrated health systems or managed care
• FFS more challenging
Local
Organizational Context
(e.g. capacity - culture)
Where do these levers exist?
• In hospitals
• In clinics
• In nursing homes
• In home health agencies
Physician - Patient
Encounter
Accountable Care Organizations
Current measures
Future measures should
Focus largely on individual
accountability (setting or
clinician) for technical quality
Focus on shared accountability
for quality (broadly defined) and
costs.
Will do little to address:
• Prevention / population health
• Care fragmentation, silos
• Provider-dominated decisions
• Capacity and costs
Including measures of:
• Disease burden, outcomes
• Integration & coordination
• Informed patient choice
• Longitudinal resource use
Three components of ACO infrastructure
• Local Accountability for Cost,
Quality, and Capacity
• Shared Savings
• Performance Measurement
ACOs - a few characteristics are essential
1
Can provide or manage
continuum of care as a
real or virtually
integrated delivery
system
2
Are of a
sufficient size
to support
comprehensive
performance
measurement
3
Capable of
internally
distributing
shared savings
payments
Accountable Care Organizations
“experimental model”
Physician-Hospital Networks
Physicians and beneficiaries make
naturally occurring groups centered
around hospitals.
Surgeons
Primary care
specialists
Hospital
Other
specialties
Medical
sub-specialists
Linking Beneficiaries and Primary Care MD
PCP
PCP
Hospital
PCP
PCP
Virtual Physician-Hospital Network
PCP
Medical
sub-specialists
PCP
Surgeons
Other
specialties
PCP
Hospital
PCP
Virtual Physician-Hospital Network
Cohort of Linked Medicare Beneficiaries
Medical
sub-specialists
PCP
PCP
Surgeons
Other
specialties
Hospital
Physician-Hospital Network
PCP
PCP
Bynum, Health Services Research, 2007
Concentration of Care: Physician Visits
Reliance on PHN for Physician Visits
Number of
Medicare
Beneficiaries
in Network
Percent of
Total
Beneficiaries
Number of
Local
Networks
Percent of
E&M Visits
Within PHN
Under 5,000
21.9%
2616
61.6
5,000 -10,000
26.4%
941
70.4
10,000 –15,000
21.1%
422
72.6
15,000 +
31.6%
376
73.8
Concentration of Care: Costs
Percentage of Costs within PHN physicians and hospital
Number of Medicare
Beneficiaries in
Network
Percent of
Physician costs
(RVU) in PHN
Percent of
Total costs
(RVU+DRG) in PHN
Under 5,000
43.8
45.8
5,000 -10,000
62.9
63.2
10,000 –15,000
66.9
66.9
15,000 +
69.2
69.0
Concentration of Care: Hospital Stays
Percentage of Hospitalizations occur at PHN hospital
Number of Medicare
Beneficiaries in
Network
Percent of Medical
Hospitalizations in
PHN
Percent of Surgical
Hospitalizations in
PHN
Under 5,000
61.5
18.9
5,000 -10,000
65.7
46.2
10,000 –15,000
66.1
54.4
15,000 +
65.3
59.8
 Surgical hospitalizations to primary hospital and most commonly used
Hospital for high DRG hospital stays
Most of their care from a single identifiable
providers grouped around a hospital
Bynum, Health Services Research, 2007
Concentration of Work: Physician
Percentage Physician’s billing
accounted for by linked cohort
Number of
Medicare
Beneficiaries
in Network
Percent of Patients billed who are in PHN by Specialty
Primary Care
Medical
Specialty
Surgeons
Other
Under 5,000
85%
48%
48%
30%
5,000 -10,000
85%
54%
49%
38%
10,000 –
15,000
84%
55%
49%
42%
15,000 +
84%
56%
50%
43%
Concentration of Work: Hospital
Percentage Hospital admits and costs
accounted for by linked cohort
Number of
Medicare
Beneficiaries
in Network
Percent of all
Medical
Hospital stays
at hospital by
linked cohort
Percent of all
Surgical
Hospital stays
at hospital by
linked cohort
Percent of
Hospital Costs
at hospital by
linked cohort
Under 5,000
71.1
64.0
69.2
5,000 -10,000
67.5
59.2
62.7
10,000 –15,000
66.5
57.6
60.6
15,000 +
65.9
55.9
58.7
Health Policy Research
Current Studies using PHN
• Racial disparities in ambulatory diabetes care
• Surgical rates defining signature & efficiency
• Care fragmentation across clinicians and
setting
 Unifying feature of these studies is need
for a defined population
Health Policy Implications
• Current Medicare markets beneficiaries
concentrate care in virtual networks
◦ Especially if large hospital with broad services
◦ If not, it is possible to determine referral hospital
• Population-basis and size allow measurement of
outcomes and costs
• With measureable performance for populations
comes potential for accountability
Acknowledgments
NIA PO1 Co-investigators Team
Dan Gottlieb
Jon Skinner
Don Carmichael
Elliott Fisher
Kathy Stroffolino
Stephanie Tomlin
Dartmouth Atlas team
Julie Lewis
Jack Wennberg
Yunjie Song
David Goodman
Jason Sutherland
Weiping Zhou
Collaborators
Brookings Institute