The California Pilot That Could Prove ACOs Work

Date: 05.15.2013 | Zach Urbina">Zach Urbina

After much anticipation: Accountable care organizations have arrived.

Or at least, researchers — armed with data that attempt to quantify ACOs’ impact — made their way to Washington, D.C., last week, drawn to a Health Affairs roundtable on payment reform.

Economist Austin Frakt discussed his study, conducted with UC-Berkeley researcher Rick Mayes, on how lessons from capitation have informed ACO development. Harvard University’s Joel Weissman presented a report that examined the design and implementation of shared savings formulas across various actual programs.

And Paul Markovich, the president and COO of Blue Shield of California, detailed the insurer’s successful partnership with providers that, beginning in 2010, saved CalPERS about $37 million over two years.

That partnership — with Dignity Health and Hill Physicians Medical Group, and serving CalPERS beneficiaries in the Sacramento area — was built around a pilot that shared both risks and savings. It targeted overutilization and unnecessary readmissions, which are common problems for most providers.

And setting a global budget worked, Markovich reported. Over a two-year period, the annual growth rate of the cost per member per month was about 3%, less than half the annual growth rate of premiums over the past 10 years.

It’s the kind of evidence that ACO supporters say demonstrates the model will rein in costs and boost quality. And even better: it’s replicable.
continue reading | via Dan Diamond, California Healthline Contributing Editor

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