Post #1: Let’s Keep Them in Our ACO
For our first post, we’re going to take a very simple idea and boil it down to actual numbers. A lot of people can talk about churn rates, but seldom do they communicate the actual impact, and quite frankly, I’ve heard very little about keeping those beneficiaries who are about to be “churned” in the ACO. Honestly, if an ACO can nail this process, they are practically guaranteed to reach shared savings. It’s really that simple.
In dealing with this strategy, we’re talking about one single CMS rule: CMS requires that an eligible beneficiary have at least one primary care visit within the past 12 months with a qualified physician (MD/DO).
For some, this rule isn’t as easy as it sounds. For those ACOs that have a shortage of physicians, this could be difficult, as most appointments are performed by advanced providers. This becomes a process issue, and there are several strategies to assist with this as well. But that’s for another day.
The theory behind this strategy is simple. Keep the healthy people in your ACO. This is where we get a bit blunter. We want the low-cost beneficiaries in our ACO. Heaven knows there are plenty of high-cost beneficiaries, so a few at the bottom of the scale would be nice. However, you can’t just go out there and tell your providers that you want them to see the low-cost patients. (If you do, we encourage the use of the term “less engaged.”)
Most likely, your ACO is structured like most others where 25% of your annual spend is made by the top 5% of your beneficiaries. I would also venture to guess that 50% of your beneficiaries are below your benchmark. The mortality rate at the top is going to be relatively high, and you also know that many of your mid-level beneficiaries are going to be moving up to that top 5%.
But what about the bottom half? You most definitely need a strategy to build that base. You can’t necessarily count on a significant percentage of the population decreasing their costs from year to year, so you need a plan to keep that base as big as possible.
Let’s take this example:
Let’s assume that you have 10,000 lives in your ACO contract, your benchmark is $12,000, and your 12-month total spend is $125M. You’re way over benchmark and things don’t look good. (Purposefully avoiding enrollment types and person years to keep this simple.)
You have about 500 people that dropped out of the ACO last quarter due to not seeing an MD/DO in the previous 12 months and their average cost is a meager $1,250, which is quite typical, perhaps even a bit high. (The number dropped can be found in your quarterly roster assignment.)
If you kept those people in the ACO, your attribution would have been 10,400 with a total spend of $125,625,000 ($125M+500*1.25k) – averaged out to $11,964. Suddenly you’re below benchmark!
So what are some good strategies, you ask?
For those of you who have a Retrospective Roster, just think of all the Assignable beneficiaries you can add to this pool. CMS is giving you all this data so find those who can build your base and get them re-engaged. Provided that their plurality of care can be obtained, it doesn’t take much to get them into the ACO as well.
For the Prospective Roster ACOs, it’s a bit more difficult, and you’ll have to plan ahead and monitor the beneficiaries’ primary care visits so that all your ducks are in a row before you get your roster.
One of the best steps to stay on top of this dilemma is to keep track of your beneficiaries’ primary care visits with your ACO’s qualified physicians. Know the last date of service and make sure they are seen again within 364 days. They may have several office visits during that time, but if it is with an RN or PA, it’s not going to count. If you keep up with this monitoring, you can easily tell your providers which patients need to be seen and by what date.
In conclusion, it makes sense when you say that having more low-cost beneficiaries in the ACO will help you make shared savings. However, you definitely need a plan for this. This tweaks the numbers a bit in your favor but if you’re like other ACOs, any advantage you can get is worthwhile. It’s a simple strategy that levels the playing field and gives you the opportunity to spend more time on your beneficiaries’ outcomes and overall care.
Next Up: Post #2: “Partner-Level Benchmarks”
Jeff Bazinet