Featured Health Business Daily Story, Dec. 11, 2012

Specialists: ACO Cost Center or Potential Partner in Efficiency?

Specialists typically are seen as cost centers for accountable care organizations, not as partners in the organization. But if ACOs choose the highest-quality and most cost-effective specialists and then integrate them, they potentially could generate significant cost savings for the ACO, consultants say.

Eventually, effective ACOs will hand-pick specialists to become integrated into their provider networks — clinically, technologically, operationally and financially — and those specialists will participate fully in the care model, says Terry Spoleti, president of Glenridge HealthCare Solutions. Specialists working in communities dominated by ACOs will need to perform well or they will lose access to patients, she says.

“There will certainly be winners and losers as specialists compete for referrals based on cost, quality and service,” Spoleti says. “In ACO and population health organizations, utilization will decline, so a smaller pool of specialists will need to serve a broader population.”

However, this is a long-term, data-fueled transition, she says, as ACOs invest in data infrastructure to analyze and publish scorecards and outcomes data (ABN 11/12, p. 1). It will take several years — at best — to move away from the entrenched fee-for-service system for specialists and into a system where the most successful ACOs work with the most effective specialists, Spoleti tells ABN.

It’s not clear yet whether most specialists will become part of ACOs or whether they’ll remain outside the organizational structure, yet closely affiliated.

There are multi-specialty medical groups serving as ACOs — such as Coastal Carolina Quality Care, a Medicare Shared Savings Program (MSSP) ACO (ABN 10/12, p. 6).

MSSP and the Medicare Pioneer ACO program place the focus squarely on primary care physicians (PCPs) and the patient-centered medical home, says Martie Ross, a consultant with Knoxville, Tenn.-based consultancy Pershing Yoakley & Associates. Consequently, there’s been little emphasis on integrating specialists into ACOs, and the overwhelming majority still is compensated via fee-for-service payments.

Ross notes that there’s a growing amount of data available, such as from CMS’s Physician Quality and Reporting System (PQRS), that ultimately will provide hospital-specific and specialist-specific reports on outcomes, she says. “If you’re a primary care physician who wants to decrease costs and improve quality, you’ll be able to look at reports like this. Transparency becomes a game-changer,” Ross tells ABN.

Of course, ACOs are starting to collect and analyze their own data, not just relying on CMS or large commercial payers, Spoleti says. Sophisticated scorecards from individual ACOs will allow providers to evaluate their own performance and the performance of their peers.

This shift could be painful for specialists — and possibly even for PCPs who believe they now are referring to the best possible specialists, Ross says. The lowest growth in health care spending has come from evaluation and management services, long the purview of PCPs, she says. Meanwhile, the highest growth has come from specialist procedures and hospitalizations, she says.

“If you’re a primary care physician, you’re in a position to control both [procedures and hospitalizations] with your referrals,” Ross says. Once this shift takes place — and it’s happening now — then a particular specialist will need to make certain that his or her outcomes data paints a rosy, cost-effective picture, Ross says.

PCPs in both MSSP and Pioneer have a limited ability to direct patients to specific specialists, since neither program features a closed network of providers. Still, Spoleti says, “the PCP remains a critical center of influence” and “will increasingly make referrals to preferred specialists and facilities within the ACO network based on established clinical pathways and outcomes data.”

Meanwhile, some ACOs — particularly commercial ACOs — are working at establishing a “brand” for themselves in their communities through marketing and services such as care coordination, and specialists not aligned with a particular ACO “risk being left out of this value proposition,” Spoleti says.

In an ACO-dominated world, specialists will need to market themselves to PCPs, Ross says, and will need to show that they’re helping to improve quality and efficiency. This will involve meeting quality measures, standardizing practice protocols and exhibiting the flexibility to appeal to a large number of potential referrers, regardless of whether they’re inside the ACO or outside.

Although it seems logical to think that PCPs all will want to refer to the top specialist group in a given area, “that top 1% will only be able to work so many hours in a day,” Ross says. “It’s an access issue.” It’s more likely that specialists in the top quartile of a given practice area will be tapped more often by local PCPs, she says.

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