CHE hospitals join partners to model Medicaid ACO

April 15, 2011


The federal health reform law enacted last year encourages health care providers to band together under the "accountable care organization" model to improve the quality of health care and drive down the cost of care for Medicare patients.

Coalitions of care providers in Camden, Trenton and Newark, N.J., have been partnering for years under a model similar to an ACO to enhance how care is delivered. But in New Jersey, the ACO-type programs benefit Medicaid patients. Now coalition members are formally asking the state legislature to create Medicaid ACOs.

Facilities within Newtown Square, Pa.-based Catholic Health East are among the organizations participating in the coalitions. "The community need for this is huge," said Anna Marie Butrie, a CHE vice president. By making the health system work better for people, she said, "we are improving people's health and also freeing up resources to help others." 

Banding together
In the Patient Protection and Affordable Care Act, the federal government defines an ACO as a group of health care providers and suppliers like pharmaceutical companies that join together under a formal legal structure to take accountability for the quality and cost of the care they deliver to people insured through Medicare. The care providers are expected to coordinate patients' care, and they share in the rewards and the financial risk of caring for these patients. The federal government expects cost savings to result from the ACO model use, and ACO participants and Medicare would share in those savings.

The New Jersey version of this model has health care providers in major urban centers collaborating to address heavy Medicaid rolls and usage. The three coalitions that CHE facilities are participating in bring together most of the major health care and social service providers in each city to coordinate — and improve upon — how Medicaid patients are using the health care system. A key goal is to reduce episodic care, in favor of coordinated care.

The coalitions expect their efforts to reduce how much the state and the federal government spend per Medicaid beneficiary. They are investigating what they call a gain-sharing program in which they could share in the benefits of this saving.

High utilizers
The Camden Coalition of Healthcare Providers has been together for more than a decade, and it is furthest along. It includes CHE's Our Lady of Lourdes Medical Center, a competing Camden hospital and most of the primary care, mental health and substance abuse facilities that treat patients covered by Medicaid. These providers share information about men, women and children covered by Medicaid through a health information exchange. The providers can slice the data to show who is using health care services the most and whether they are accessing the system in an inefficient way, for instance by going to the emergency department when they could be treated in a primary care setting. The providers work together to provide case management-type services to help the patients better navigate the system.

The coalition has been assembling teams of care providers to meet with high utilizers to assess and address the reasons for seeking medical care in an unnecessarily high-cost, inefficient way. It also is identifying specific neighborhoods with many frequent users of emergency department care and putting clinics in those areas. It is adding nurse coordinators to primary care clinics in areas with high E.R. use to encourage patients to seek care in appropriate venues. And it is helping doctors' offices to offer same-day appointment scheduling. The coalition has a way to go in putting these measures in place, but it already has been able to reduce its Medicaid charges for patients in the database, according to Christy Stephenson, executive vice president for strategic and clinical transformation for CHE in New Jersey.

Health care and social service providers in Trenton began their coalition about six years ago. CHE's St. Francis Medical Center works with another local hospital, federally qualified health centers, other clinics and mental health and substance abuse agencies and the City of Trenton in that group. The Newark coalition, which includes CHE's Saint Michael's Medical Center as well as other local providers, is still in its infancy but hopes to engage in the same type of data sharing and care coordination that is happening in Camden and Trenton. 

Hand holding
Stephenson provided an example of how this brand of care coordination can work. A five-year study of hospital charges logged in the Trenton coalition's database revealed which Medicaid patients used emergency departments the most. Among them was a homeless woman named Betty who used emergency departments more than 450 times in one year. (CHE requested that Betty's last name be omitted for privacy considerations.) Almost daily, Betty would drink until reported to the police. Officers would take her to the emergency department to sober up. "But you can't fix substance abuse in the emergency department," said Stephenson.

The coalition worked with its partners in the community to connect Betty with substance abuse services and with an organization that could provide housing. She now has her own dedicated case manager, attends a day treatment program and has her own apartment. She has not returned to the emergency department since the coalition's intervention.

Dr. Jeffrey Brenner is a family physician and director of the Institute for Urban Health at Camden's Cooper University Hospital. He founded the Camden coalition and serves as its executive director. He said the coalition's work is aimed at addressing a primary criticism of the health care system — that it is not always responsive to the vulnerable people who need the system the most. "If you're deaf, if you're blind, if you're in a wheelchair, if you don't speak English, if you're depressed, if you have complex comorbidities, if you're isolated, if you don't have a car — if you have one of these things, it's hard to get to the doctor. If you have two or three of those things, it's almost impossible.

"The irony is that we've built a health care system that really only works if you're healthy," Brenner said. "If you have illnesses and you're struggling to get care, it really doesn't meet your needs."

He said the complexity of the health care system and the way it currently rewards the volume of care delivered rather than the quality of care, makes it hard for individual providers to take accountability for the care of individual patients. And that makes it easy for struggling patients to fall through the cracks.

Brenner cited an example of a 70-year-old diabetic he encountered in his work with the coalition. The patient has vision problems, and was having trouble managing his diabetes. When a case-management team visited him to assess the care he was getting, they watched him draw insulin from a vial. He barely drew any. But, because he couldn't see, he didn't know he was drawing too low a dose. "So the problem there is: Who is the accountable manager here who is responsible for ensuring that he got optimal care?" Brenner asked. "Was it the endocrinologist? Was it the discharge planner? Was it the utilization manager? Was it the emergency room doc? Was it the social worker? Was it the floor nurse? Was it his primary care doc? Who dropped the ball here?

"If we don't answer that question in the next year or two we are going to implode from ever increasing health care costs," Brenner said.

Brenner is heartened by the increasing interest in ACOs, and he noted that Catholic health care is well-positioned to take part in such care models. "The Catholic health care model is in many ways ahead of the economic model in health care," he said. "Better care for sick people is what Catholic health care has been doing for 100 years. It's mission-driven and patient-centered. The problem is, the way insurers and the government pay for health care hasn't rewarded that mission.

"I think that's changing though," Brenner said, "and the great news is that this will create the opportunity for Catholic health care services to lead the country and show the way."

Formalizing the Medicaid ACO model

Members of three New Jersey health care coalitions now want to make their informal accountable care organizations, formal. They are working with New Jersey state legislators to develop legislation creating Medicaid ACOs. The legislation would allow for a demonstration project in which coalition members in urban areas formally join together to create an ACO infrastructure, coordinate care for people insured by Medicaid, document the gains they achieve in terms of savings to the Medicaid system and then share those monetary savings with the state. They call the cost saving model gain-sharing. They'll also share financial risk under this model. Legislators are set to have a hearing on the legislation next month.

Members of the New Jersey coalitions also have been meeting with officials from the Centers for Medicaid and Medicare Services to determine whether the federal government can promote the Medicaid ACO model. Currently, the federal government's definition of ACO extends only to provider groups serving Medicare patients.


Copyright © 2011 by the Catholic Health Association of the United States
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