A Brave New World
Changes in Accountable Care Can Lead to Savings for Beacon
Saving lives and improving quality of life –– that’s what we’re called to do at Beacon Health System. And to do this, we need to generate revenue from health care services as well as avoid unnecessary costs whenever possible. This results in high-quality care, new technology and upgraded/expanded space for the betterment of our patients.
As a community-owned hospital, it’s our mission to provide the best care possible to everyone who needs our services, regardless of their ability to pay. While health systems like Beacon are helped financially when we have a majority of payers with commercial insurance, an increasing proportion of our patients are instead covered by government-run programs such as Medicare or Medicaid. In these cases when patients have Medicare or Medicaid, Beacon depends on government reimbursement for provided health care services.
ACO All the Way
Therefore, it goes without saying that reimbursement plays an important role in Beacon operating as an effective health system. A couple of years ago, a new reimbursement model was introduced at Beacon –– value-based reimbursement. Rather than being paid by the number of visits and tests (fee-for-service), providers’ payments are based on the value of care (value-based care).
Going hand-in-hand with value-based care was the creation of Accountable Care Organizations (ACO) across the country. ACOs better coordinate patient care, lower costs and eliminate unnecessary tests and procedures –– all things in line with driving patient care based on value, not volume.
In 2014, Beacon entities joined CHA ACO, an ACO that coordinated care for Medicare patients so that they get the right care at the right time in the right place. In 2017, Beacon and CHA ACO made the decision to take on a more risk-based contract. This means Beacon takes a greater financial risk to ensure Medicare patients in the ACO receive the highest quality care at the lowest possible cost. It’s also critical as part of this contract to reduce hospital readmissions and conduct preventive screenings among these patients. If Beacon is able to improve quality and reduce overall Medicare spending, the government will share a portion of their savings with CHA ACO in the form of a bonus payment, which will contribute to Beacon’s overall financial position.
Because Beacon started its Medicare ACO two years ago, we have the foundation in place, unlike some other health systems, to make this ACO risk-based contract successful, says Daniel Parker, Director of Value-Based Strategy at Beacon. It’s important for Beacon continue to do everything it can to provide the highest quality, most coordinated care.
3 Things to Remember about the New Medicare ACO
- Always have a mindset toward improving quality and/or reducing unnecessary visits, tests or procedures. We are held accountable for the quality and cost of the care provided to our patients.
- We are expected to coordinate all of the care our patients receive, not just the care that we provide. We must work closely with all providers in our community to ensure that the care of each patient is closely monitored and coordinated throughout the care continuum.
- Embrace the use of data and analytics to support clinical and operational decision-making.
On The Horizon
In addition to their work with the Medicare population, CHA ACO is expanding to work with commercial insurers as well via a commercial ACO called “Beacon ACO.” Beacon ACO is a group of doctors, hospitals and other health care providers who come together voluntarily to give coordinated, high-quality care. The goal of coordinated care is to ensure that patients, especially the chronically ill, get the right care at the right time, while avoiding unnecessary duplication of services and preventing medical errors.
When the Beacon ACO succeeds in delivering both high-quality care and spending health care dollars more wisely, it will share in the savings it achieves for the program. These “shared savings” will be between the providers that are part of the ACO network and the medical plan. Any savings that are shared with the medical plan will be passed on to the participants by maintaining lower premiums.
This commercial ACO will begin in 2017 with a familiar patient population: Beacon associates. Starting in 2017, our associates will have access to the “ACO” plan, which will connect them with this network of high-value providers in our community, including many of our very own Beacon physicians.
