Benefits

Employers Making Sure That ACOs Measure Up

By Rita Pyrillis

Mar. 20, 2018

Interest in accountable-care organizations is expected to spike in the next couple of years as more large companies adopt alternative payment models, but with more than 900 of the provider networks of varying sizes and characteristics in the marketplace so far, assessing their performance can be a head-scratcher for employers.

The Pennsylvania Employee Benefits Trust Fund discovered just that — with several insurance carriers across the state, gathering ACO performance data is a challenge, according to executive director Kathryn Farley. The group, which covers 290,000 active and retired state employees, launched an ACO last year.

“It’s not that we can’t get data from the health plans, but when you have multiple carriers and everyone wants to report what they want to report, the challenge is getting consistent data so you can effectively compare ACOs,” Farley said. “That’s hard when someone measures something in one way and someone else in another.”

In an ACO, doctors and hospitals share the responsibility for providing patient care by coordinating their efforts to avoid unnecessary tests and treatments. Data sharing plays a critical role not only for providers but also for employers who are trying to determine if ACOs are living up to their promise to improve health care quality while managing costs, Farley said.

ACO models are still fairly new, but interest in them is growing. According to the National Business Group on Health’s “Large Employers’ 2018 Health Care Strategy and Plan Design Survey,” 21 percent of employers will be promoting ACOs offered by their insurance carriers or contracting directly with ACOs in 2018, but that number is expected to double by 2020. The more than 900 ACOs of varying sizes in the marketplace each come with a different mix of providers, performance measures and other characteristics that make it difficult to assess their effectiveness, according to Brian Marcotte, president and CEO of the NBGH.

But employer groups are stepping in to help employers better understand how ACOs work and how to evaluate them.

In July, the NBGH released a guide to help companies develop an ACO strategy and in January 2018, the nonprofit employer’s coalition, Catalyst for Payment Reform, issued a set of standard performance measures for employers to share with their health plans.

“The employer has very little information on whether the ACOs are improving the quality of care,” said Suzanne Delbanco, executive director of CPR. “The ACO might pick just a few clinical measures to report on. So we created a standard report. Think of it as a nutritional label. You know where to look for the calories and for the fat. You can compare two soups. We want to foster that same approach for ACOs — a standardized approach with metrics that employers really care about.”

At e-commerce giant Pitney Bowes, an early pioneer of value-based insurance design, obtaining complete and useful ACO data from the insurance carriers it contracts with has been challenging, according to Jennie Pao, manager of health care planning at the mail services company.

“We are getting very limited information,” Pao said. “We are getting high level information, like one or two quality metrics on cancer screenings or diabetes and high blood pressure metrics.”

Part of the difficulty in gathering data is that employees are automatically assigned to an ACO based on the number of visits to a particular provider, which is called an attribution model ACO. Under this arrangement, patients don’t know that they are in an ACO and may not have financial incentives to seek care from an ACO provider, according to Pao.

This year Pitney Bowes launched two ACO pilot projects in Chicago and Fort Worth, Texas, that allow employees to choose an ACO provider network during open enrollment in exchange for lower premiums and lower cost sharing.

Pao said that she’s been discussing the company’s concerns about measuring ACO performance with its health plans and has asked carriers to start reporting on the standardized data developed by CPR.

“We’re excited to work with (Catalyst for Payment Reform) to develop more meaningful metrics,” she said. “It will take a while but we’re hoping to get much better reporting in the future.”

Rita Pyrillis is a writer based in the Chicago area. Comment below or email editors@workforce.com. Follow Workforce on Twitter at @workforcenews

Rita Pyrillis is a writer based in the Chicago area.

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