Reference no: EM132204875

System Redesigned To Implement An Accountable Care Organization

Introduction

Central Group Health System (CGHS) is the largest group health system in its region. As a not-for-profit organization, it has the mission of “Providing The Highest Quality Care To All People, Independent Of Ability To Pay.” It includes 10 hospitals (large tertiary care centers to smaller community hospitals) several ambulatory care centers and community health centers located across two states on a southwestern border. It includes 41 affiliated physician managed clinics, federal qualified healthcare centers (FQHC), a hospice program, a home health agency, and a nursing home network. It has agreements with military treatment facilities (MTF) and Indian Health Service (IHS) organizations to support referral care either way.

Currently, the system employs 500 physicians. 1500 health professionals are on contracts affiliated with it. There are also 14, 250 full-time equivalent staff. The CGHS hospitals and ambulatory care centers are autonomous in maintaining their day-to-day operations, but strategic direction and any major operational charges are led by the C–Suite. As director of operations, you work under the Chief Operating Officer (COO) to implement corporate strategy throughout the system.

The Accountable Care Organization (ACO) Challenge

The COO recently informed you the board of directors has requested a feasibility study to determine the effects of CGHS to become an Accountable Care Organization (ACO). The board wants CGHS to apply for the Medicare ACO program and seek out similar arrangements with private insurers. They also want their physician group practices to work in concert with this program especially for referrals and preventative health care services. Under a shared savings program, such as the program sponsored by Medicare, a baseline expenditure amount will be calculated on historical usage, and then future expenditures will be projected. If actual expenditures are less than projected expenditures then the difference between the two or savings will be partially paid to the provider, assuming certain quality benchmarks are met. There are numerous metrics.

The COO has asked you to search out the pioneer ACOs and required metrics and summarize your findings (hint) . For example, if a Medicare population is projected to cost $10 million over the next year but the provider only bills for 9 million, the $1 million savings will be split between Medicare and the provider. However, a set of metrics and associated criteria or thresholds must be met or exceeded. The savings are expected to result from improved care coordination, population health, and the ACOs ability to focus on providing appropriate care. The COO has emphasized the need for care coordination and better health outcomes, however he also realizes the tension on the daily business.

The board would like to know what would be the best way to design care delivery if the central group health system were to become an ACO. Additionally, because the board is constantly seeking to achieve its mission and goals to provide high quality care, it would like to know if striving to achieve the aims of ACO such as care coordination and population health management could help them to improve care throughout the group central group health system and at what cost in terms of actual investment, time, and mental energy expended. The assessment also needs to include how to better integrate physician health group practices throughout the health system.

The Current Central Group Health System Organization

CGHS is a silo health care system where a patients can receive outpatient, specialty care, and ancillary services that is world class, but they are basically on their own when trying to navigate between and among the different specialties, services, agreements (in and out of network). Further, CGHS has a competent primary care program staffed by physicians affiliated with, but not employed by CGHS. Primary care physicians simply refer patients to specialty care services and do not follow up or monitor these referrals and this is not necessarily with in the CGHS. The system has no central tracking of patients nor any full-time patient care coordinators. Any current care coordination is provided and formally by in individual practitioners.

Redesigning The Health System

To become an ACO, CGHS will need to monitor the care from patients from the time they entered the system, track the different services they use, and coordinate the care they receive from different providers. This also requires visibility, transparency, and performance measures focusing on healthier patients. This will require administrative, logistic, nursing practice, public health integration, community engagement, and clinical care changes such as profiling, an re-credentialing. Administratively, CGHS will need to develop the capabilities to proactively communicate with patients, track patients, and convey information to providers. Clinically, CGHS will need to be able to review the care provided, screen patients, ensure appropriate preventive care is delivered, and ensure the necessary quality of care benchmarks are met.

The COO recognizes to properly coordinate care and improve population health, fundamental changes must be made to see CGHS. He has suggested several potential models to organize the administrative and clinical care necessary to coordinate its patient population. These include divisional, matrix, and parallel designs. He has also suggested you research the different models of care throughout the world because he thinks there may be alternative or innovative healthcare models being used by other countries that may be applicable (hint). The COO recognizes different models will require different capital investments primarily in information technology and telehealth, addressing the culture of the current organization, and will require buy-in from different interested parties. The following initial designs have been provided by the COO:

Division Design: under a divisional model, CGHS would focus administrative and clinical care coordination at each individual hospital that would be responsible for coordinating the care of patients who go to that hospital or receive their care in nearby ambulatory care settings. These ambulatory care settings have same-day surgery capability and other outpatient services that have traditionally been done on an inpatient basis. Health system level coordinators and hospital level coordinators would then be responsible to handoff patients who go to a different hospital or ambulatory care Center and they would report to a centralized office.

Matrix Design: with a matrix design, administrative and clinical care coordinators would be assigned to each individual hospital and would report differently to hospital management. However, they would work out of a central health system location within teams of other care coordinators who would be assigned to different hospitals, and they would additionally report to the central office.

Parallel Design: a parallel design would feature to separate coordination systems with one focused on administration and the other opportunities on clinical coordination. These care coordination systems could either be embedded with individual hospitals or centrally located, but both would report to the same centralized care coordinator.

The COO would like you to propose a model that will minimize the risk to CGH S if becoming an ACO is not successful, while maximizing the potential upsides of becoming a more coordinated health system if care coordination succeeds at improving care quality and lowering the cost of care. In addition, the COO wants you to propose how to integrate physician care practices into the system to improve referrals, better health, and improved relations with the community.

Case Questions

What are the strengths and weaknesses of the present system?

What do you think are the opportunities and aspirations for aspirations CGHS?

How would you measure success (hint: ACO metrics)?

What advantages and disadvantages does the model you proposed have compared with alternative organization structures including international health models? Ensure you access at least one international health model.

What advantages for patient care does the proposed model provide?

How would you overcome the culture of non-transparency and non-openness with respect to provider performance?

See Guidance and Tips for answering case studies analyses (CSA) in the Guidance and Tips Folder