Understanding ACOs in
Minnesota
MARIE ZIMMERMAN
M I N N E S OTA D E PA R T M E N T O F H U M A N S E R V I C E S
CHW ALLIANCE JUNE 5, 2014
Why transformation is needed
• State budget pressures Medicaid program and other
payers of health care.
• Provider financial incentives do not encourage reducing
cost and improving quality of care – volume vs. value.
• Provider innovation to lower cost and improve quality is
often penalized, not supported.
• Health outcomes for Medicaid enrollees and other
populations need improvement.
• Care should be centered around patients and their families.
Moving toward value-based incentives
•
Addressing these challenges will require important changes in
provider payment and methods of delivering care
•
Key roles need to be played by all — consumers, employers,
providers, health plans, government and other — to effect this
transformation
•
Payment systems should:
• Give providers the freedom and support necessary to foster innovation
within the delivery system so that they can determine the most efficient
and effective means of providing and improving health.
• Provide the opportunity to replicate these innovative care models
across the state of Minnesota.
Impetus for Accountable Care Organizations
Impetus for ACOs
Desired Outcomes
• Develop payment approaches
to create incentives for value
not volume
• Shift risk and rewards closer to
point of care to foster local
accountability
• Realize return on federal and
state investments
• Improve access to
care, outcomes and
information for the enrollee
• Value = Better Quality + Lower
Cost/“The Triple Aim”
• Integrated prevention, wellness,
and community services
• Coordinate care across care cycle
• Data to monitor utilization,
compare and share locally and
across states
• New reimbursement structures,
including incentives that
encourage integrated care
models
Slide provided by Center for Health Care Strategies (CHCS)
Accountable Care Organization**
• A group of health care providers, with collective responsibility for patient care
that helps coordinate services – delivering high quality care while holding
down costs*
• Innovation lies in the flexibility of their structure, payments and risk
assumption (i.e., how much “skin in the game” they have in terms of
controlling costs and improving quality)
• Likely to include PCPs, specialists, and likely a hospital, and other provider and
community agreements/partnerships. May need the ability to administer
payments, set benchmarks, measure performance, and distribute savings
*Robert Wood Johnson Foundation, http://www.rwjf.org/en/topics/search-topics/A/accountable-care-organizationsacos.html
**Accountable Care Organizations: A new model for sustainable innovation, Deloitte Center for Health Solutions
Slide provided by Center for Health Care Strategies (CHCS)
Key Issues for ACOs
1. Identifying a feasible payment model
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Shared savings/risk

Per member per month payments

Global budget

Bundled payments for episodes of care
2. Building atop existing delivery system reform efforts

Patient-centered medical homes

Health homes (Medicaid, Section 2703 of ACA)

Dual eligibles integration
Slide provided by Center for Health Care Strategies (CHCS)
Key Issues for ACOs, Cont’d
3. Requiring core provider capabilities
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Patient stratification
Patient-centered care management and coordination
Population health management
Data infrastructure and analytics
4. Engaging providers, communities, and patients
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Program planning processes
Governance structure
Provider criteria
Ongoing mechanisms for input
Slide provided by Center for Health Care Strategies (CHCS)
Key Issues for ACOs, cont’d
5. Including unique high-cost populations

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Dual eligibles
General assistance and expansion populations
6. Defining the scope of services
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Medical services
Behavioral health
Long term supports and services
Social services
7. Selecting appropriate quality metrics
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Align with existing programs
Measure targeted outcomes
Tailor metrics to sub-populations patients
Tie payment to quality
Slide provided by Center for Health Care Strategies (CHCS)
Key Issues for ACOs, cont’d
8. Supporting provider capabilities

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Learning collaboratives
ACO coaches
Training sessions
IT/data supports
9. Aligning with other payers
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Medicare Shared Savings and Pioneer ACOs
Commercial TCOC/ACO arrangements
State Innovations Model
10. Partnering with CMS
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CMS Concept papers for key components
Identifying appropriate regulatory approach
Slide provided by Center for Health Care Strategies (CHCS)
National ACO models
 Medicare Shared Savings Program (CMS)

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Eligible providers, hospitals, and suppliers participate in ACOs to improve the
quality of care for Medicare Fee-For-Service (FFS) beneficiaries and reduce
unnecessary costs.
Advance Payment ACO Model provides supplemental support from CMMI to
physician-owned and rural providers for start-up resources to build the
infrastructure (e.g., staff, improving information technology systems, etc.)
 Pioneer ACO Model (CMMI)


For early adopters of ACOs
Designed to support organizations with experience operating as ACOs or in similar
arrangements in providing more coordinated care to beneficiaries at a lower cost to
Medicare. The Pioneer ACO Model will test the impact of different payment
arrangements in helping these organizations achieve the goals of providing better
care to patients and reducing Medicare costs.
Slide provided by Center for Health Care Strategies (CHCS)
Minnesota’s ACO Models
 Minnesota Medicaid ACOs
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Integrated Health Partnerships (IHP)
Hennepin Health
Integrated Care System Partnerships (ICSP)
 Commercial ACO/TCOC Agreements
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Health care providers and systems participate in a range of different
delivery and payment arrangements aimed at improving the Triple Aim
May include performance based on outcomes/quality and cost; varying
levels of financial risk from shared savings to sub-capitation
Many use MN Community Measurement TCOC metric and quality
measures
Arrangements can be across multiple population (self-insured, commercial
and government) for some health plans
Minnesota’s Approach to
Medicaid ACO development
 Define the “what” we seek, rather than the “how”
 Provide multiple opportunities for innovation under a
framework of several models
 Allow for local flexibility and innovation under a
common framework of accountability
 Framework of accountability includes:
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Models based on, and with accountability for, total cost of care
TCOC)
Robust and consistent quality measurement
Models that drive rapidly away from the incentive “to do more”
Models that drive rapidly towards increasing levels of integration
Three Examples
 Minnesota Medicaid ACO model:
Integrated Health Partnerships (IHP)

Previously the Health Care Delivery System (HCDS) demonstration
 Hennepin Health: a Safety Net ACO
 Integrated Care System Partnerships
(ICSPs)
Example 1: Minnesota’s
Medicaid ACO Demonstration: IHP
“The Minnesota Department of Human Services
shall develop and authorize a demonstration
project to test alternative and innovative health
care delivery systems, including accountable care
organizations that provide services to a
specified patient population for an agreedupon total cost of care or risk/gain sharing
payment arrangement.”
(Minnesota Statutes, 256B.0755)
IHP Process and Timeline
 Started with an RFI process, to gather input
 Developed and issued initial RFP in summer 2011
 Responses received were broadly representative of geographic
and organizational structure
 6 provider systems, serving ~100,000 Medicaid enrollees,
started in our IHP model in January 2013
 3 additional provider systems began in 2014, for a total of
~145,000 Medicaid enrollees currently being served
 Released an updated RFP in February 2014 seeking additional
providers to begin in January 2015
Minnesota’s Medicaid ACO Demo (IHP):
145,000 enrollees total
IHP
Geographic area
Size
(# Attributed)
CentraCare
Central MN, north of Minneapolis/St. Paul
11,037
Children’s Hospital
Minneapolis/St. Paul
16,066
Essentia Health
Duluth/NE MN
30,485
FQHC Urban Health
Network (10 FQs)
Minneapolis/St. Paul
23,757
Hennepin Healthcare
System/HCMC
Minneapolis/St. Paul
24,558
Mayo Clinic
Rochester/SE MN
5,985
North Memorial
Minneapolis/St. Paul
3,824
Northwest Health Alliance
(Allina/HealthPartners)
Minneapolis/St. Paul
12,194
Southern Prairie Community
Care
Marshall/SW MN
17,947
Provider Characteristics/Requirements
IHP providers must
 Deliver the full scope of primary care services.
 Coordinate with specialty providers and hospitals.
 Demonstrate how they will partner with community
organizations and social service agencies and
integrate their services into care delivery.
 Have flexibility in governance structure and care
models to encourage innovation and local solutions.
Accountability Framework
• Providers contract with DHS under one of two
models: Virtual IHP or Integrated IHP.
• The models include the same framework but have
different financial arrangements.
• The goal was to ensure broadest possible
participation and available options.
• The agreements are 1-year contracts that renew
annually for the 3-year demo period.
Accountability for Total Cost of Care
 The IHP is accountable for its attributed Medicaid enrollees’
Total Cost of Care (TCOC)

Both fee-for-service (FFS) and managed care (MCO) recipients attributed
 TCOC is defined as subset of Medicaid services health care
organizations can reasonably be expected to impact. IHP may
elect to add excluded services.
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Generally includes inpatient, outpatient, physician/professional
,pharmacy, certain mental health and chemical health services
Generally excludes dental, supplies, transportation, long term services
and supports
 Existing provider payment for services persists during the
demo, with shared savings/loss payments made annually
based on risk-adjusted TCOC performance
Patient’s Included IHP (Attribution)
 Patient attribution is based on where the patient had the
most visits using health care claims data; goal is for
attribution to reflect established patient/provider
relationship.
o
Attribution is based primarily on health care homes (HCH) and
primary care provider (PCP) relationships.
o
Patients still maintain freedom of choice, no “opt out” required.
o
IHP receives monthly attribution roster of people for whom they are
accountable.
 All Medicaid populations are included except for people
dually eligible for Medicare and Medical Assistance.
Accountability for Quality/Patient Experience
 IHP performance on core set of measures based on existing state
reporting requirements – Minnesota’s Statewide Quality
Measurement and Reporting System (e.g. optimal diabetes,
asthma, and vascular care; depression remission)
 Core includes 7 clinical measures and 2 patient experience
measures, across both clinic and hospital settings
 IHPs have flexibility to propose alternative measures and
methods
 Performance on quality measures impacts the amount of shared
savings an IHP can receive; phased in over 3-year demo
Example 2: Hennepin Health
 “Safety-net ACO”
 Population focus: adults on
Medicaid with incomes
below 133% FPG ~ 8,600
 Integrated county model;
health care, behavioral
health, social services
 Opportunity for savings
outside the Medicaid
program to county services
Hennepin county:
Minnesota’s largest county
(Minneapolis)
Example 3: Integrated Care System Partnerships (ICSPs)
 Initiative within Minnesota Senior Heath Options/Senior Care+
(MSHO/MSC+) and Special Needs Basic Care (SNBC) managed care
programs for seniors and people with disabilities, designed to align with
statewide HCH, SIM and Medicaid ACO provider payment reform
initiatives
 Expands and builds on Medicare/Medicaid MCOs and provider
contracting arrangements and experience; Leverages Medicare
involvement in State payment reforms

Encourages improved health outcomes and choice of care setting
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Encourages long-term care provider involvement
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Encourages increased coordination of physical and behavioral health
 30 MCO/Provider ICSP proposals accepted for implementation for
January 2014, with additional ICSPs required for 2015
Opportunities for CHWs in ACOs
 Contribute to ACO performance on the Triple Aim:
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Health care expenditure savings
Quality measures/health outcomes
Patient/Consumer Experience
 How can CHWs help ACOs achieve their goals?
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Better understanding of communities/populations they serve
Act as a member of the care team to provide the connection between
clinical and community services
Trust of the client to facilitate consumer/patient-provider communication
and education
 Savings achieved can help finance CHWs in ACOs
Next Steps
 Minnesota’s SIM grant builds on IHP and other ACOs in
the market
 SIM funding for CHWs and other emerging professions
 Expansion to additional populations (duals, complex)
 Increasing importance placed on partnership with non-
traditional health care providers and services and
community involvement
 Strong emphasis on integration of acute care and other
care settings and long-term services and supports (more
global community responsibility)
Contact
Marie Zimmerman
Health Care Policy Director
Minnesota Department of Human Services
Phone: (651) 431-4233
Marie.Zimmerman@state,mn.us