Senior leadership should support ACOs, then take backseat

To be successful in developing and implementing accountable care organizations (ACO), senior leaders must buy into the collaborative care model, but they also should take a backseat and let others drive, according to experts at America's Health Insurance Plans' (AHIP) Summit on Shared Accountability in Washington, D.C., on Tuesday.

"Get senior leadership involved right away," said Rosaleen Derington, chief medical services officer at Hill Physicians Medical Group in California. "Then have leadership turn it over to others."

In describing the ACO process in the three-way partnership between Hill Physicians Medical Group, Blue Shield of California, and Catholic Healthcare West, Blue Shield's senior vice president of network management Juan Davila agreed that "senior leadership should give permission and then get out of the way," he said, laughing with conference attendees. Permission comes from the top, but operation comes from the middle.

That supportive, backseat approach has helped these California organizations save $15.5 million in 2010. Inpatient readmissions and length of stay each have fallen by 15 percent, according to Derington.

With aligned incentives, Blue Shield, Hill Physicians, and Catholic Healthcare West sought long-term strategies aimed at improving quality and efficiency. The goal also was to stabilize healthcare premiums, which are slated to double in California in the coming years, according to Davila.

"We must address it, or it will be addressed for us," Davila said about healthcare reform. Insurers, therefore, should take it upon themselves to become involved.

Blue Shield invested $1 million into Hill Physicians to help move the accountable care initiative forward. Much attention went into developing a data strategy. Although they wanted to improve the costs and outcomes of the top 5 to 10 percent of patients who were considered high-cost, each organization had different opinions (and data) on what high-cost patients looked like. In addition to differing data, the organizations faced the challenge of compiling information from the various sources but integrated through health IT. Derington also advised that organizations consult legal counsel to determine the high-cost population groups.

Derington added the accountable care payment model requires a cultural change on the hospitals' part away from the money-tree approach, in which payment is based on services and volume. Instead, alternative revenues must come from cost savings and reduced waste, the more "sensible, sustainable path," he said.

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