Framing the Issue

• Disease management is critical for the 26 million Americans with diabetes to prevent such complications as early death, cardiovascular disease, eye and kidney disease, nerve damage and amputation.
• Health care providers are seldom paid for the extra work and investment that disease management requires, so they don't have the resources to conduct organized disease management programs and lack experience in this realm.
• Public and private payers are experimenting with accountable care models that aim to align delivery system changes, such as providing disease management, with payment reform.
• Some accountable care arrangements with private insurers feature global budgets with potential for shared savings if providers slow costs and bonuses if they reach quality improvement targets.

Public and private payers' drive toward pay for value makes chronic care management an asset in hospitals' portfolios, especially for such prevalent and costly conditions as diabetes.

But as providers delve into disease management, one question stands out: Will they be fairly reimbursed for the services and investment these programs require?

"When you have patients with complex diabetes, you can't just pat them on the head every three to four months," says Katherine Roberts, M.D., a solo-practice endocrinologist in Williamsburg, Va. "You're not just taking care of their blood sugar. You're making sure their blood pressure and cholesterol are under control. You're making sure they're checking in with their cardiologist if they have one. [Payers] may be pushing for pay for quality vs. pay for volume, but we'd like to be paid for our time."

Increasingly, payment reform is beginning to catch up with delivery reform, sometimes even serving as the catalyst for change in the way doctors provide diabetes care. Medicare's shared savings/accountable care organization initiatives are the most high-profile examples of payment reform accompanying delivery reform, but private insurers are getting into the game with their own accountable care models, says Tere Koenig, M.D., senior vice president for clinical integration at the Camden Group, a health care consulting firm in Chicago.

In July 2013, UnitedHealthcare announced plans to more than double its accountable care contract business across its employer-sponsored, Medicare and Medicaid plans from $20 billion of its reimbursements to providers to $50 billion by 2017. The insurer has three levels of such contracts that vary in terms of shared accountability and financial risk.

Meanwhile, Aetna had 27 ACO agreements nationwide as of July 2013. More than 200 are in the pipeline, says Robert Kropp, M.D., senior medical director for Aetna Accountable Care Solutions.

In 2009, Blue Cross Blue Shield of Massachusetts launched one of the first accountable care initiatives involving a global budget, shared savings and risk, and quality incentives, in the commercial market. Today, 18 provider organizations participate in the alternative quality contract. The organizations are a mix of physician-hospital partnershipsand physician-only entities.

The contract involves HMO members only. Each provider organization's first annual global budget is based on its patient population and historic spending to care for that population, explains Dana Gelb Safran, senior vice president of performance measurement and improvement at Blue Cross Blue Shield of Massachusetts. The budget is adjusted for inflation each year of the five-year contract on a pre-negotiated basis.

If the provider organization comes in under budget, it shares the difference with the Blues plan. However, if the provider organization comes in over budget, it and the health plan share the hit. "Now they have the incentive to look really hard at those dollars and decide where there is waste in that spending," Safran says. "Where is there care happening in settings that are more expensive than they need to be? Where is there utilization that is not delivering any improvement in health or value in terms of better quality or outcomes?"

The contract includes financial incentives for reaching targets on 64 process and outcomes quality measures, several of which are diabetes-focused. Provider organizations surprised the insurer by embracing the outcomes measures, Safran says.

"I thought we would go to the table and they would say, 'You must be kidding me if you think we're going to be responsible for what happens when our patients are out living their lives. I can be accountable for checking the A1C, but I can't be accountable for controlling the A1C because the patient might not keep to the diet I recommend,'" she says. Instead of balking at the prospect of outcomes measures, the early adopters not only accepted them, but also asked that they be weighted more than process measures.

Initially, the shared savings and quality incentive streams were separate, but now they are combined in a way to maintain an emphasis on reaching the quality targets regardless of whether the provider organization meets its budget. The better the score on quality, the more shared savings a provider organization gets to keep. If the organization goes over budget, the better the quality score, the less it has to pay back.

The program has resulted in slower spending growth and better quality, according to a study in the August 2012 issue of Health Affairs that examined the contract's first two years. The contract generated savings of 1.9 percent in its first year and 3.3 percent in its second year.

All of the participating provider organizations earned a 2010 quality bonus. Overall, the article states, the providers participating in the contract outpaced the Massachusetts Blues network average on each of the three diabetes outcomes measures — A1C, blood pressure and cholesterol control.

One way physicians are achieving quality gains is by using data to identify gaps in care. The Massachusetts Blues plan feeds participating organizations monthly data that show how they're performing in relation to the targets, Safran says. Many practices invested in information systems that support population health management by supplementing the insurer's claims data with data pulled from patients' electronic health records. The EHR then can signal the clinical team when a patient needs an A1C or cholesterol check.

Practices "aren't just waiting until their patient's next appointment and hoping the patient shows up; they're very meticulously monitoring their patients and following up with them between visits, particularly the ones that they're most worried about," Safran says.

Patient data catch docs by surprise

The Northeast Physician Hospital Organization, which went to an alternative quality contract in 2010, created a quality team that combines the BCBS claims data with data feeds from patients' EHRs to create patient registries, including a diabetes registry, and to generate monthly performance reports it shares with physicians. The team also conducts one-on-one meetings with physicians a few times a year to reinforce the importance of quality improvement and to discuss any difficulty they're having, says Les Sebba, M.D., medical director for Northeast PHO, which includes Beverly (Mass.) Hospital and Addison Gilbert Hospital, Gloucester, Mass.

The data were an eye-opener for some doctors. "They all thought they were on top of these patients, but when you actually print out the registries, you see how many patients fall through the cracks for one reason or another — somebody canceled an appointment, for example," Sebba says. "Unless somebody really was following up to make sure it's rescheduled, it's very easy for that patient to fall off the radar screen for six to nine months. The educational piece enabled them to see just how easy it is to lose track of a patient and how important regular follow-up of registries is to be successful in improving the overall health of the population."

Since entering the contract, the PHO has improved its scores on each of the individual diabetes process and outcomes measures. One of the most dramatic improvements is in its composite score for all the diabetes process and outcomes measures. In 2012, the organization met all the performance targets for 60 percent of diabetic patients, up from 33.6 percent in 2010.

The PHO has earned shared savings each year, though the amount is confidential, says Nicole DeVita, the organization's executive director.

In Memphis, Tenn., Baptist Memorial Health Care and physicians have partnered to create Select Health Alliance, a clinically integrated network that in April entered into an accountable care arrangement with Aetna. The contract follows the global budget model and includes the potential for shared savings and quality incentives. The provider organization is eligible for shared savings only if it meets targets for process and outcomes measures, including a set focused on diabetes.

As of July 2013, about 640 primary care and specialty physicians were in the alliance and the number continues to grow. Another 200 doctors who are part of Baptist's employed physician group also participate in the alliance. "From my perspective, it's unusual to see multiple providers come together with agreed measures and hold each other accountable," says Paul DePriest, M.D., chief medical officer for the Baptist system.

Under the arrangement, the alliance receives quality reports from Aetna based on claims data. The information is valuable because it allows physicians to see whatever care their patients received outside their offices and even outside the Baptist system, DePriest says.

The alliance enhances the claims data with clinical data from patients' health records and formulates reports it shares with physicians. In the summer, doctors just began getting performance reports.

It's too early to tell the impact the arrangement has had on quality. But, DePriest says, "We're following the processes that will get us to the outcomes we want."

It's a win-win. Or is it?

Although data help, achieving savings and quality improvement under an accountable care arrangement takes more than good IT systems. "It's difficult work," Koenig says. "It's care process redesign, culture change and using staff in different ways."

One example is disease management. Typically health insurers, not physician practices, run care management programs for patients with complex chronic conditions. Plans have a wealth of expertise in identifying patient populations, determining which patients are at high risk, and reaching out to engage them, Aetna's Kropp says. Because care management is so new to most physicians, Aetna is providing practices in Select Health Alliance with extra case management support and encouraging physicians to become partners with the plan in working with high-risk patients.

"We recognize that patient education, dietary counseling and care coordination take time," Kropp says. "Up to now, that kind of effort was not reimbursed. Now, we've constructed a relationship, and Aetna is giving resources to allow the right care to take place."

At Blue Cross Blue Shield of Massachusetts, a multidisciplinary team meets with provider organizations' clinical leaders on a regular basis. One of its roles is to teach them about case management, Safran says. Eventually the plan will turn case management over to the physician practices. "Now that we have an incentive model and a payment model, we shouldn't be duplicating their effort because we'd just be adding to the waste in health care," she says.

The emphasis on disease management under accountable care arrangements is driving new staffing models. "You're not going to have the doctor spending time on the phone calling patients," Safran says. "So in many cases, [practices] have hired case managers, and their job is to work with patients who are at risk of bad outcomes."

Accountable care arrangements also encourage physician practices to try to engage patients in their own care, for example, by offering group diabetes education classes, Koenig says. They might not get reimbursed for the sessions, but the cost could be worth it if patients change their behavior.

But do the shared savings and quality incentives cover the investment in time, information technology and staff?

Sebba at Northeast PHO says that the return to physicians participating in the alternative quality contract has been "very positive from a financial point of view."

"It's a win-win," he says. "The patients benefit. The doctors feel better about what they're doing and, financially, it's beneficial both for the doctors and the system because the budget-efficiency saves significant amounts of money from a systems point of view."

The problem for providers in accountable care contracts is that not enough patients are covered by them. Doctors don't practice different care depending on whether a patient is in an accountable care plan. Select Care Alliance physicians are collecting clinical data on all their patients, not just Aetna members, DePriest notes. They're applying the same standards of care and quality measures to all their patients. But insurers generally don't reimburse for care management.

For Northeast PHO, the alternative quality contract helps doctors to get paid for the extra time that care management requires, but it's limited to the organization's 17,000 patients enrolled in the Blues plan's HMO, Sebba notes. The PHO has similar contracts with two other HMOs, but would like to see accountable care arrangements spread to other insurers and to PPO products.

In January, Northeast PHO and Beverly and Addison Gilbert hospitals' parent organization, Lahey Health, became part of the Medicare shared savings program, DeVita says. "Now we have data to identify who the Medicare diabetics are who have gaps in care so that we can do the same thing with the Medicare population as we're doing with the alternative quality contract population," she says.

Meanwhile, the Massachusetts Blues plan is working on an accountable care PPO model, Safran says. "We are in the early stages of building that into the contracts with providers who've had the most experience with the alternative quality contract," she says. "These are the providers who've opted into the Medicare Pioneer Program. These are the providers who want their other commercial payers to pay them with a global budget contract. Now that they've built the systems to manage that way, they don't want to live in two worlds. They want to live in a world where all of their payers are roughly incentivizing the same thing."

— Geri Aston is an H&HN contributing writer.

Hospitals offer disease management directly to businesses

With the burden of chronic illness growing and health care costs rising, employers increasingly are interested in care management programs to improve employee health and save money. Some hospitals are contracting directly with businesses to provide comprehensive on-site services to help them achieve those goals.

"All providers need to be thinking about how they are going to go from build-a-facility-and-people-will-come to providing care when and where a person needs it," says Daniel Birach, president of corporate health and wellness for Carolinas HealthCare System. "Ambulatory care is the future. This is providing a virtual patient-centered medical home."

Comprehensive work-site services typically begin with an assessment of the employee population. Advocate at Work starts with analytics, using claims data to determine how much an employer is spending on chronic conditions, says Teresa Taylor-Dusharm, operational director of Advocate Health Care's program Advocate at Work. Diabetes typically is a major cost-driver for employers.

From there, the process moves to on-site biometric screening. At Carolinas, that involves measuring weight, height, hips and neck, along with a blood pressure check and a blood draw. The results of the population analysis determine what type of program would work for that employer and identify patients who need services. For diabetic employees who are medically stable but not in optimal range, a common intervention is one-on-one, on-site health coaching. "What we're trying to do is get people to take responsibility for their health and to make changes — eat better, exercise more, take your medications, quit smoking," Birach says. Patients with poorly controlled diabetes not only would receive on-site coaching, but also would be referred to a primary care physician if they didn't already have one.

For some large employers, an on-site health clinic makes sense. Carolinas has 14 such clinics staffed by advanced practice nurses. An employer needs to have 750 or more employees at one location to make an on-site clinic financially viable, Birach says. Carolinas uses the same electronic health record in its clinics as it does throughout the system. "That allows us to look at the whole individual and coordinate care," Birach says. At Advocate, the system's clinical integration includes on-site physicians, and that's one key to success. "Patients are going to get the same treatment at the clinic as they would at one of our community or hospital facilities," Taylor-Dusharm says.

Both health systems have on-site programs for their own employees that they use to innovate. Successful strategies are spread to commercial clients. "When we walk up to an account, and they ask whether we use this internally, I can say, 'Yes, we do. Here are the results,' " Birach says. — Geri Aston

Managing diabetes: ABCs matters

A1 C: In general, every percentage point drop in a high A1C level can reduce the risk of microvascular complications (eye, kidney and nerve disease) by 40 percent.

Blood pressure: Controlling diabetic patients' blood pressure decreases the risk of cardiovascular disease by 33 to 50 percent and the risk of microvascular complications by about 33percent.

Cholesterol: Improved control of LDL cholesterol can lower cardiovascular complications by 20 to 50 percent.

Source: "National Diabetes Fact Sheet, 2011," Centers for Disease Control and Prevention

Executive corner

Data are essential …
to improve the quality of diabetes care and produce cost savings under accountable care arrangements. The best approach is to enhance insurer claims data with clinical data from electronic health records to identify care gaps and patients at risk of poor outcomes, as well as prevent duplication of services.

Regular quality reports …
derived from a blend of claims and clinical data allow physicians to see how their performance compares with the targets set under the accountable care contract. The quality standards should include both process measures, such as performing A1C tests at least twice a year, and outcomes measures, such as the percentage of patients with good A1C control.

Success hinges on providers …
not only identifying at-risk patients but monitoring their progress and reaching out to them between office visits when needed. "It's about thinking about patients' real lives and what for that specific patient are the barriers to keeping blood pressure, cholesterol and A1C under good control?" says Dana Gelb Safran, a Blue Cross Blue Shield of Massachusetts senior vice president.

Closing the gaps in care …
to improve quality and lower costs is another key to success. For example, if physicians are able to see which patients frequently are going to the emergency department, they can build processes to get them the care they need sooner and in the appropriate setting.

Accountable care contracts' emphasis …
on disease management likely will necessitate new staffing models. Some providers are hiring case managers to monitor and reach out to at-risk patients, as well as having all clinicians work to the fullest extent of their licenses.