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Insights from ACO Pioneers (Part One: Physicians)

How can healthcare organizations that were built on volume adapt to the arrival of a value-based reimbursement system?  American providers, as well as payers, are struggling to find an answer to that critical question. When it comes to the Accountable Care Organization (ACO), the struggle generally takes two forms: either to jump in with both feet via a model such as the Medicare Pioneer ACO program, or to sit back and take a wait-and-see approach.

In a new white paper, Allscripts Chief Medical Officers Doug Gentile, MD and Toby Samos, MD explore the unique perspectives of both types of organizations. The six organizations studied (each an Allscripts client) include two of the original 32 Pioneer ACOs; the nation’s largest commercial ACO; a major IDN that is pursuing its own ACO pathway; a large stand-alone hospital that has yet to take the formal step of creating an ACO but is experimenting with the model; and a large, independent, multispecialty physician group that is wary of stepping into the ACO waters.

Over the next month, It Takes A Community will publish the main white paper in four segments designed to reflect the four key stakeholders within an ACO: Physicians, Hospitals, Payers and Patients.  This is the first installment.

To read the white paper in its entirety, go to


Key Takeaways: 

  • Physician leadership is critical
  • Local governance advances shared goals
  • Equip physicians with infrastructure to succeed
  • Use both local and global incentives
  • Educate and train on a schedule
  • Monitor physician performance
  • Work to engage independent physicians

The ACO flips the traditional adversarial relationship between hospitals and physicians on its head. To be successful, an ACO requires shared, consensual leadership between hospitals and physicians, who come to the table as fully equal partners in the new organization.  

“An ACO requires a reactivation of physician leadership at a very basic level,” said Scott Fowler, MD, President of Holston Medical Group. Rather than the top-down management structure designed for a volume-based system, an ACO requires “team leadership that’s educated to manage value in the system from the ground floor up, and that requires the central organizing principle to be that you have physician leadership built into the system before you start with anything else.”

Physician Leadership is Critical

Several participants in this paper called out the elevated role of primary care physicians within an ACO.  “I think this is really the Renaissance for primary care,” said Mark Shields, MD, MBA, FCAP, Senior Medical Director of Advocate Physician Partners. “With our ACO, primary care physicians do what they got into medicine to do – work in teams, optimally managing chronic conditions, and providing easy access to care.” 

Shields added that ACOs must do more than pay “lip service” to physician leadership. “It has to be driven by physicians; that is critical to the process,” he said. In Advocate’s ACO, key committees are heavily dominated by physicians. Yet the organization cannot assume physicians have the leadership skills necessary to contribute. “Just because someone’s a good clinician does not mean they’re able to chair a critical committee,” said Shields, adding that Advocate invests to train its key physicians in leadership skills.

Use Local Governance

Local physician governance should be built into the overall governance structure, advised Shields. Advocate has organized each of its hospitals and local physicians into a Physician Hospital Organization (PHO) to nurture adherence to the shared goals of the ACO.

As Shields put it: “Local is critical. If I as senior medical director send a memo out to all physicians saying you need to work harder to raise your generic prescribing rate, it gets tossed in the wastebasket. But when a local medical director walks up to a colleague in the hallway and says ‘generic prescribing, when clinically appropriate, is really important,’ that really sticks.  This is somebody the docs know and trust. So that local input is very, very important to making our program successful.”

Equip Physicians with Infrastructure

All participants emphasized the importance of giving physicians the infrastructure and tools they need to succeed in an ACO. All physicians are required, and in some cases provided incentives, to adopt technologies that enhance communication of critical information, drive performance and, ultimately, improve patient outcomes. These include high speed Internet access, Computerized Physician Order Entry (CPOE), ePrescribing, web-based registries, Electronic Health Records in the physician’s office, and a shared community record.  

Huntington Hospital in Pasadena, Calif. has dipped its toe in the ACO waters by providing its affiliated physicians with a “universal translator” (Allscripts Community Record) to create a single view of the patient between the different EHRs in use across the community. Called Huntington Health eConnect, the Health Information Exchange (HIE) enables physicians, hospitals and other health care providers across the San Gabriel Valley to connect and collaborate for a team approach to patient care, regardless of where they are located or which clinical technologies they use.  In October 2011 Blue Shield of California awarded Huntington a nearly $1 million grant to support its HIE efforts with the goal of building an ACO.

“We’re using Allscripts to build transparency and care collaboration with our physicians while we’re working out the agreements as to whether we will be capitated,” said Rebecca Armato, Executive Director of Physician and Interoperability Services for Huntington Hospital. “We’re not an ACO yet but we’re practicing as one, and providing patient care as one. When you create that transparency and complete view of the patient record, doctors start to make the right decisions around the right things without even realizing it.”

Include Both Local and Global Incentives

One of the risks of incentivizing physicians on the performance of a broad community of providers and hospitals is that they may lose the enterprising spirit of a small, local group. Recognizing that peer pressure is an important success motivator, Advocate bases 30 percent of a physician’s ACO incentives on the performance of their local PHO, while the remaining 70 percent is tied to the overall performance of Advocate Physician Partners.    

“Having 30 percent of the dollars local creates some very healthy dynamics,” explained Shields. “You have radiologists and OBGYN’s and others all talking to each other about how they’re doing on their quality measures, so they all have an incentive to ensure others are doing well.”

This year, Advocate will distribute more than $90 million in shared savings to physician participants in the ACO.

Educate and Train on a Schedule

It’s not enough to simply equip physicians with the tools they need or to enroll them in an ACO. Success with the project requires ongoing education and training. “Educating docs about the ACO isn’t easy,” said Shields. Advocate provides quarterly in-office training sessions for physicians and their staff on technology-enabled processes and workflows, as well as e-learning sessions with CME credit to encourage physician participation.   

Parie Garg, Ph.D., a consultant with Oliver Wyman’s healthcare practice, noted that EHR training, in particular, needs to be continuous to ensure physicians and their staff know how to make the most of the technology’s population management capabilities. “Training needs to be continuous, every six months or every quarter and all people in the office should attend so they can see what the EHR can do for them,” Garg said. “In an ACO there needs to be a broad understanding of what (EHR) data fields are required not just by your practice but by the other community organizations from whom you need to see data.”

Huntington Hospital’s Armato emphasized the importance of showing physicians how they can benefit from using technology within an ACO. “We go into their offices to help them baseline and show them the ROI and how to adopt an EHR effectively,” Armato said. “We also make it clear that to survive in this marketplace we’ve got to do this together and an EHR is the minimum requirement. So at every medical staff meeting I’m there showing the technology. They know they’re not alone out there.”  

Physician education in an ACO goes beyond IT, though. Advocate also uses a formal collaborative to train its physicians on management of chronic disease and other key components of advanced medical home. “We’ve deployed diabetes and chronic disease clinics in key geographic areas where our outcomes for diabetes and other chronic diseases lag, and by having clinical protocols in place in these key areas it has really helped us drive outcomes,” Shields said.

Monitor Physician Performance

Performance monitoring is a basic element of any ACO because performance (quality measurement) is how the ACO gets paid. But several participants noted the importance of making quality assurance a part of the monitoring process by leveraging the EHR. 

Holston Medical Group has been using its EHR for nearly a decade to monitor physician performance on a number of quality-related metrics, said Owen Poole the group’s Chief of Business Development. “Some of the things we measure with the EHR include how many docs have tasks on their list that aren’t finished every day? How many are populating whether a patient smokes or not? Docs won’t do anything unless they have an incentive and in our system if you don’t finish your tasks on time, you get a note and eventually your income is changed.” 

At Advocate, physician performance against the ACO’s quality measures is monitored throughout the year and reported formally to each physician on a quarterly basis. “Physician report cards actually are now available online in real time, so physicians can check where they stand daily and what they need to do to improve performance,” said Shields. “We take advantage of the fact that doctors are very competitive. When some of the specialists realized they didn’t have measures that would allow them to be called out as an ‘exemplary doctor’ under our program, they almost rioted.”

Engage Independent Small-Practice Physicians

One of the common challenges noted by the participants is the difficulty of getting physicians in solo or small practices to both implement an EHR and join the ACO. “They are very reluctant to adopt an EHR and we are trying to identify the barriers,” said Chris Brown, senior director of strategic planning for Scripps Health. Scripps’s 85-percent EHR subsidy for physicians “has provided little incentive,” Brown said. “The disruption in the workflow is one of the biggest barriers to them, and fear of loss of their own revenue during that transition.”

Poole of Holston Medical Group believes the problem with getting small practices on board has different roots. Holston has successfully added dozens of small primary care offices to its EHR network but doing so required careful negotiating. “What we think is that doctors view their medical records as theirs, and the idea that they’re going to turn that over to somebody, or that the data belongs to the world, is just mistaken,” said Poole. “You have to educate the doc so they understand where the information is going, what’s going to happen to it, who’s going to have access to it. Just like the patient, you have to get them comfortable.”

Oliver Wyman’s Garg suggested that ACOs develop physician champions in small practices to educate their peers. “They need to have example physicians in their community who will stand up and tell them, ‘look, this is possible, if you mine the data it gives you this, here’s the ROI you’ll get, come to our offices and we’ll show you how it happens.’”

Watch for Part 2 of the white paper next week …

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