Independent Owners: Get Your IT House in Order for ACOs

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There is industry wide-debate about the viability of ACOs, fueled by CMS’s proposed rules, which have hospitals up in arms about too much risk, too little reward, start-up costs, micromanagement, and too many restrictions on partnerships. While ultimately we may not call them ACOs, entities that manage bundled payments are here to stay, because the savings for CMS are just too attractive: studies and pilots are showing a 5% cost savings to taxpayers.  Reducing hospital readmissions is seen as the primary savings vehicle of choice. More and more entities will make data-driven decisions about the partners with whom they manage care episodes across the care continuum to avoid the pain of Medicare cuts for high readmissions coming in 2013.

“Data-driven decisions.”  What does that ultimately mean?  CMS offered a clue on August 23, 2011 when it launched  the “Voluntary Bundling Demonstration Project” and stated “CMS will give preference to applicants who are meaningful users of HIT resources or who have a minimum of 50% of providers meeting the standards of meaningful use.”

This should serve as a wakeup call for the LTC industry: in the new outcomes-driven world of healthcare, EMR is mission critical and providers across the country must rapidly embrace it for competitive survival. In a keynote address she will deliver next week Wednesday at the Independent Owner’s Luncheon at AHCA, Teresa Chase, President & CEO of American HealthTech will emphasize the unique challenges of Independent Owners and how they can create competitive advantages:

• Speed and agility. Free from the bureaucratic layers of management of larger chains, independent owners can quickly get their digital house in order to be ready to mine data for outcomes reporting. 

• Local relationships.  Entities managing episodes will shop local markets and choose providers with the best outcomes.  It doesn’t matter if providers are large or small, but whether they have sustainable, data-driven outcomes that exceed those of their neighbors.  With Medicare cuts coming to hospitals with high readmission rates, hospital CFOs will be the new economic decision makers when it comes to the partners with whom they coordinate care. The days of marketing to discharge planners for census are over.  If you’re an independent owner with great outcomes, have a kid who plays on the same soccer team as the kid of the local hospital CFO, you’ve got a serious leg up.  If not, read up on C-suite marketing – and start strategizing how you’ll get a seat at the negotiating table.

• Specialization.  There are rich sources of data to help independent owners find out where their local hospital(s) are struggling.  USA Today has a handy interactive map.  You can search by state, by disease, and also track the 100 worst offenders nationwide. Once you figure out where a hospital CFO is struggling, you can create care programs for specific diagnosis, report your outcomes, and lock up the referral business.   Pay special attention to hospitals that are high above national averages for readmissions for the top three diseases CMS will initially track:  heart attack, heart failure, and pneumonia.

• ACOs are everywhere.  Hundreds of ACOs are forming around the country, in more than 40 states.  Link to Premier’s site for the latest list.  And it’s not just a big metro market thing. Because care models are physician centric, the nets ACOs are casting are wide to make the minimum 5,000 Medicare beneficiary number.  They need to find enough doctors with the patients to make the cut.  ACOs may not necessarily be hospital centric in these markets – there are a number of physician groups that have managed bundled payments for years across wide territories of rural markets.  Get to know them.

Benchmark a leading Independent Owner

Clapp’s Convalescent Nursing Home, a 100-bed community in North Carolina, sped forward. Clapp’s is running a paperless operation and has a reputation for the highest quality care in the region. Armed with access, alliances and answers, Clapp’s is ready for reform demands.  You can read more about Clapp’s readiness for the outcomes world of healthcare in this white paper.