Interesting Characteristics of Accountable Care Organizations (ACOs) that you may not have Expected

FluidEdge consulting outlines ACO generation and performance data.

Leveraging our proprietary database of 2013 and 2014 ACO performance data that contains over 15,000 unique data elements, we’ve identified some interesting characteristics of ACOs that you may not have expected.  Every few weeks, we’ll be providing you with new insights that our clients are already benefiting from.  Looking at the data more closely and introducing new metrics such as size and benchmark cost per beneficiary combined with client experience brings a more detailed understanding to the 2014 (and 2013) ACO results. 

Smaller ACOs generated almost double the average PMPM savings of their larger counterparts while succeeding at nearly the same rate.

“Given the length of time it takes to effectively select and implement large scale IT tools, care coordination processes, population management programs and practice workflow across a physician network combined with the ability of smaller ACOs to carefully select their physicians and to directly measure and help achieve their outcomes, this is not an entirely surprising of a finding for those of us who have working closely in this space,” said Joe Taylor, ACO Practice Leader for FluidEdge Consulting.  

“When you see the ability of the smaller ACOs to focus, implement, monitor, react and directly communicate, with their primary care network, you can understand why they were more likely successful in  their first and second year.  What was surprising was is how dramatic the results were when we move away for absolute numbers and stratified the results by percentile.  

Also by using a meaningful savings metric such as savings per beneficiary, like a well-run manage care organization may use, additional insight is gained,” Taylor added.

ACOs with higher benchmark costs succeed at twice the rate of ACOs with lower benchmark costs and generated over twice the savings.

"We’ve found that benchmark cost per beneficiary is a key indicator of initial success,” per Andrew Laign, Senior Consultant at FluidEdge Consulting.  “As we looked at the results by percentile, the starting benchmark cost per beneficiary was one of the very best leading indicators of both achieving shared savings and earning higher amounts as measured on per beneficiary basis,” he added.

Looking at the data clearly shows a quandary for CMS and payors who want to keep shared savings programs viable. Per Taylor, “Now it is up to CMS to determine if, and how, to reward ACOs who have lower initial benchmark cost per beneficiary, and keep them low.  

It’s easier to reward those who had very high costs and moderate them.” he said.  “This might be one of the biggest issues CMS will have to grapple with in order to renew existing and add new ACOs to the program,” Laign added.

Per Shawn Archambault, President of FluidEdge Consulting, “Additional insights will be revealed over the upcoming weeks, after they are shared with our ACO clients.”

FluidEdge Consulting has a solution for Accountable Care Organizations (ACOs) and other Clinically Integrated Networks (CINs) worried about how their bottom line will be affected after entering into alternative payment or value-based contracting models with Medicare and commercial payers. Whether it’s a Health System based ACO trying to develop and implement their data and population management strategy or reduce the impact of leakage or a Physician-Led ACO trying to manage inpatient hospital expenditures, ED use or transitions of care our consultants and tool helps clients reach their desired financial results. 

Let FluidEdge guide the pathway to success. Providing leadership, project management, and high value operational and strategic IT services. Founded in 2007, FluidEdge has become a leader in the Health Care management and IT consulting market, delivering innovative customer solutions with a highly experienced senior team. FluidEdge has been successful at solving complex concerns for the ever-evolving Health Care industry.

In 2013, Inc. Magazine ranked FluidEdge No. 775 on its Inc. 500 | 5000 list, an exclusive ranking of the nation's fastest-growing private companies. Inc. also ranked FluidEdge #60 on their list of the Top 100 Health Companies in the nation, as well as #13 among the Top 100 Pennsylvania Companies and #16 among those in the Philadelphia Metro Area.

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