Financial and Clinical Integration of Accountable Care Organizations

Stephen M. Shortell, PhD, MPH, MBABlue Cross of California Distinguished Professor of

Health Policy and ManagementDean Emeritus, School of Public Health

Director, Center for Healthcare Organizational and Innovation Research (CHOIR)

University of California-Berkeley

Berkeley ACO WorkshopMay 8, 2015

What Are We Trying to Do?

Reaching for the Triple Aim

Improved quality and overall patient

experience

Constrained

costs

Improved population

health

What Will it Take?

Performance measurement

Incentives Capabilities

VALUE

Quality + ExperienceCost

Fundamental Changes in How Care is Paid for and Delivered

Pooling and management of assets under various organizational and governance models:

• Horizontal acquisitions and mergers

• Vertical acquisitions and mergers

• Virtual contractual arrangements and alliances

• Joint ventures

What Is Meant by Financial Integration?

The extent to which services provided to patients are coordinated across activities, conditions, providers and settings over time so as to maximize the value of care delivered.

What Is Meant by Clinical Integration?

What organizational forms can create clinically integrated care?

Key Question

ACO Participation in Physician Performance Management/Accountability, Percent within

Cluster Who Participate

Source: Shortell S.M., F. Wu, V.A. Lewis, C.H. Colla and E. Fisher. “A Taxonomy of Accountable Care Organizations for Policy and Practice.” Health Services Research., online, September 16, 2014. DOI: 10.111/1475-6773.12234.

Schematic overview of the Accountable Care Organization (ACO) Evaluation Logic Model

Source: Fisher, E. S., Shortell, S. M., Kreindler, S. A., Van Citters, A. D., & Larson, B. K. (2012). A framework for evaluating the formation, implementation, and performance of accountable care organizations. Health Affairs, 31(11), 2368-2378.

Six Key Success Factors for ACOs

• Size/scale

• Care management

• Electronic health record functionality

• Effective partnerships

• Patient/family engagement

• Measurement standardization and transparency

Source: Accountable Care Organizations: Promise and Performance.Berkeley Forum, February 2015.

What Our Panelists Will Cover• Jerry Kominski CMS Quality Performance

Measurement and Balancing Clinical and Financial Integration

• Jill Yegian Four Case Studies

• Bruce Bodaken ACO Sustainability

• Ken Kizer Clinical Integration Functionality and St. Luke’s Antitrust Case

• John Weigand ACO Antitrust Analysis

• Loren Baker Financial Incentive Alignment

Thank YouQUESTIONS/DISCUSSION

http://choir.berkeley.edu/

shortell@berkeley.edu