Healthcare Town Hall

Accountable care organizations (ACOs) and patient-centered medical homes (PCMHs) may provide nurses with greater career options. In this Nurse Zone article, Milliman’s Patty Jones discusses some new roles opening up for nurses skilled in care coordination and data analysis.

Here is an excerpt:

“Accountable care and a lot of the initiatives coming out of health reform provide some interesting and new opportunities for nurses,” said Patty Jones, RN, [MBA], a principal at Milliman, a consulting and actuarial firm in Seattle, adding that the positions will take advantage of skills nurses already have and necessitate some to develop new talents.

…“For an accountable care organization to be successful, they are tasked with coordinating the needs of a member or a patient over a series of services and different levels of care over the course of time,” said Jones, explaining that efforts will focus on case managing smoother transitions between settings and ensuring the patient takes prescribed medications and follows through with appointments to avoid re-hospitalizations.

“This is a natural place for nursing and nurse leaders to use skills in terms of care coordination and assist the patient to reach out and get attached to other levels of care,” Jones said.

Newer emerging roles, Jones said, involve patient education and engagement. But the teaching must take place within the framework of the patient’s readiness to learn and motivation for changing to a healthier state.

“It’s a coming together of the science and psychology of nursing,” Jones said.

A third area of opportunity for nurses involves resource management at the patient and organization level, not something all nurses are skilled at or interested in.

“There are real opportunities for clinical leaders, nurses included, to be part of the financial and resource management discussion,” Jones said.

Additionally, nurses will need a population view, similar to a public health approach, to identifying and closing gaps in preventive care. However, it will require an analytic mind and comfort with data.

For more perspective on how healthcare’s changing landscape is affecting nursing professionals, click here.

Reform ACOs, Healthcare, nurses, nursing, Patty Jones

Milliman’s Richard Frese has co-authored a new article on the financial reporting of medical malpractice self-insurance for the Healthcare Financial Management Association. Among other things, “Perspectives on Medical Malpractice Self-Insurance Financial Reporting” discusses how accountable care organizations (ACOs) may increase the frequency of medical malpractice claims.

Here is an excerpt:

Another trend that warrants monitoring is the emergence of accountable care organizations (ACOs) and the impact that such organizations will have on medical malpractice claims. Among the primary goals of ACOs is to improve integration of care, which should ultimately contribute to a reduction in medical malpractice risk. What remains to be seen is how independent healthcare entities forming ACOs will choose to manage medical malpractice risk (e.g., risk pools, captive insurance arrangements) and coordinate defense of medical malpractice claims. Some also argue that ACOs might increase the frequency of medical malpractice claims because patient expectations regarding quality of care will be heightened.

Read the entire article here.

Patrick Kitchen, of McGladrey LLP, contributed to this article.

Liability, Medmal ACOs, claims, insurance, Medmal, Richard Frese

The innovations and opportunities resulting from healthcare reform—accountable care organizations (ACOs) and patient-centered medical homes—rapidly expand the roles of nurse care managers. These models require population-based analysis and prioritization, proactive care gap closure and care coordination, and credible assessment of impact to determine if cost and quality are improving.

At the core of all these models and the transformative direction of health reform, are key design principles that include:

• Population-based analysis used to target and prioritize interventions
• Accountability for achieving quality and financial goals for defined populations
• Patient-centered care design that addresses medical as well as psychosocial needs
• Education and engagement strategies that directly involve the patient and family in achieving better health and preventing exacerbation of chronic care
• Medical homes and medical “neighborhoods” that integrate primary care, specialty care, and community programs in a manner that provides better resource use and easier access
• Care coordination that assists patients as they maneuver the complexities of the healthcare delivery system
• Proactive outreach that encourages timely preventive care and supports care compliance
• Transparent discussions and thoughtful choices made based on evidence-based options and costs of alternatives

Read more…

Quality of Care, Reform ACOs, healthcare analytics, MedInsight, nurses, nursing

Some have anticipated a shortage of healthcare providers in the coming decades as the U.S. population ages. With that in mind, the Alliance for Health Reform has produced a toolkit focused on “nursing, the coming shortages, how [shortages] might be avoided, and how health reform is contributing to the changing role of nursing.” The following excerpt provides context:

Currently there are about 3 million licensed registered nurses in the United States. Most, about 60 percent, work in hospitals. Almost 266,000 are advanced practice registered nurses (APRNs).

It is projected that 260,000 additional nurses will be needed by 2025 to care for the increased population, the increase in insured population and the explosive care needs for chronic diseases in the population and geriatric care in older age groups.

Several factors are thought to contribute to the projected shortage in nursing. These include a decline in RN earnings relative to other career options, an aging nursing workforce, job dissatisfaction among nurses, and an aging, sicker population that will require more intense health care services.

An October 2010 report by the Institute of Medicine recommended that nurses be allowed to practice to the full extent of their education and training, yet scope of practice laws vary from state to state. Is the time right for states to update these laws to mitigate the shortage of providers especially in primary care and especially in rural areas?

Among the resources provided in the toolkit is Patty Jones’ paper entitled “The Nurse’s Role in Accountable Care,” which considers the important role registered nurses will need to fulfill if accountable care organizations (ACOs) are going to be successful under healthcare reform. Here is an excerpt from her paper:

Nurses currently work in a variety of organizations likely to be involved with [ACOs], including practitioner offices and clinics, hospitals, insurers, and community health organizations. As a result, they often are in a position to help address one of the key needs of accountable care: improving care delivery and coordination across a variety of settings and types of care.

…Most organizations will need to take stock of their current resources, fill in gaps, and re-engineer their process. Most can leverage their current resources and help ensure the success of their program by accurately assessing and augmenting the skills of their nursing staff.

Quality of Care, Reform ACOs, Healthcare Reform, nurses, nursing, Patty Jones

Global relative value units (GlobalRVUs) allow measurement of unit price and efficiency across physician groups for accountable care organizations (ACOs), shared saving and total cost of care programs, and bundled payment and other capitated arrangements. GlobalRVUs are essentially an extension of Medicare’s resource-based relative value scale (RBRVS) so that every medical service has an RVU. The RVUs are based on Healthcare Common Procedure Coding System (HCPCS), diagnosis-related group (DRG), or National Drug Code (NDC) Pharmacy classifications and are not affected by the contractual allowed amount.

Milliman’s Will Fox offers perspective in this MedInsight blog post where he provides an example for the comparison of delivery systems.

For a more detailed account of Milliman GlobalRVUs download the white paper here.

Cost, Value ACOs, GlobalRVUs, MedInsight, Will Fox

Yesterday, Health & Human Services announced 89 new accountable care organizations (ACOs), doubling the number of Medicare ACOs.

With this in mind we’ve pulled together all of our ACO research into a single location. Here you go:

• Accountable care organizations: The new provider model
• Controlling healthcare costs the old, new way
• The Medicare Shared Savings Program and the Pioneer Accountable Care Organizations
• Building an accountable care information system
• The nurse’s role in accountable care
• Nuts and bolts of ACO financial and operational success
• Evidence-based guidelines: Essential building blocks for accountable care
• ACO gain/loss sharing
• Patient attribution in ACOs
• ACOs and medical professional liability
• Milliman’s announcement that it has been selected for a Society of Actuaries-sponsored ACO research study

 
Also, this video offers a nice overview of the ACO concept.

Electronic Health Records ACOs, Bill O'Brien, George Berry, Helen Blumen, Kate Fitch, Patty Jones, Rich Moyer, Richard Kipp, Rob Parke, Susan Pantely, Victoria Boyarski

The final post in our “Ten strategic considerations of the Supreme Court upholding PPACA” blog series looks at the perplexing question facing American healthcare: What do we do about increasing healthcare costs?

PPACA focuses on expanding coverage and insurance reform, and in some cases it shifts costs from one party to another, but it does not directly affect the unit costs and utilization that are among the major underlying drivers of healthcare costs.

Certain aspects of PPACA have the potential to affect costs. The option to implement an accountable care organization (ACO)13 reprises the managed care movement of the ’80s and ’90s, but with better technology and information, and by transferring the financial risk onto the provider to create an incentive for efficiency. With many potential ACOs already establishing the tools required to succeed,14 this reinvigorated movement is already in motion. The nuts and bolts of an ACO are still the parts needed for a more efficient system.

Most of PPACA’s explicit ACO efforts center on Medicare, and while the Medicare Shared Savings Program (MSSP) and Pioneer Programs will continue, the potential for commercial ACOs15 may prove just as significant.

Accountable care is not a solution to everything that ails the entire healthcare system, but it offers some hope and, to the extent it can meaningfully control unit costs and utilization, it just may work.

Rob Parke and Kate Fitch discuss accountable care organizations here. For more on ACOs, consider reading “ACOs Beyond Medicare” and “Nuts and Bolts of ACO Financial and Operational Success: Calculating and Managing to Actuarial Utilization Targets.” You may also be interested in the Milliman Medical Index.

Reform ACOs, Cathy Murphy-Barron, Cost, Kate Fitch, Rob Parke

Milliman today released analysis of the Supreme Court’s 5-4 decision upholding the Patient Protection and Affordable Care Act (PPACA). With the court effectively ruling the individual mandate and other elements of the law constitutional—with the notable and complex exception of certain aspects of Medicaid expansion—healthcare stakeholders can turn their attention to implementing healthcare reform.

“Since 2009, Milliman has been working with its clients to prepare for and implement the healthcare reform law,” said Clark Slipher, Milliman Health Practice Director. “With the law’s constitutionality bound up in court, it’s been an uncertain time for our clients, which include insurers, employers, providers, and state and federal governments. This ruling clarifies the road ahead for American healthcare, and while it is reassuring to know where we are going, healthcare stakeholders face many strategic challenges that will require innovation and sound financial planning in the years ahead.” 

Strategic considerations facing healthcare stakeholders include:

1. Adverse selection may still be a challenge. Even with the individual mandate in place, the success of many insurers under PPACA will depend on their ability to minimize adverse selection.
2. Medicaid expansion just became a far more complex and variable proposition. The court’s decision to allow states to opt out of Medicaid expansion creates dynamic changes across the healthcare system.
3. Employers grapple with new options and plan requirements. While reports of the demise of employer-sponsored insurance coverage are premature, these plans still face many potential changes.
4. What is the effect on early retirees? The role of the employer in covering those between 55 and 65 may change under PPACA.
5. Rate review scrutiny and no risk selection: Something’s got to give. Keeping rate increases under 10% may become more challenging with many of the traditional cost-control mechanisms no longer available to insurers.
6. Which states will get on the exchange bandwagon? With the Court decision minimizing uncertainty, there may be increased incentive for states to fast-track exchange planning.
7. Minimum loss ratios (MLR) pose an ongoing challenge for insurers. Insurers have struggled to comply with the MLR requirements, and increased volatility in medical costs potentially brought on by adverse selection may compound the difficulty for insurers.
8. Risk adjustment is essential. A new reform calculus is required with traditional risk selection techniques such as medical underwriting no longer allowed.
9. Will cost shifting hold steady, increase, or decrease? Subsidies, rating restrictions, and an effort to achieve universal coverage all introduce new cost dynamics for insurers, providers, and policyholders.
10. The cost problem persists. What can be done about it? Certain aspects of PPACA have the potential to affect costs, but this potential needs to be actualized in order to moderate annual cost increases that regularly exceed other consumer spending.

 
For more detail on each of these strategic considerations, see the full article. To receive regular updates on Milliman’s healthcare perspective, visit our healthcare reform library or follow us on Twitter.

Reform ACOs, adverse selection, Clark Slipher, Cost, cost shifting, early retirees, employers, Medicaid, Minimum loss ratios, rate review, risk adjustment, state exchanges, Supreme Court

Milliman has been selected by the Society of Actuaries (SOA) to conduct an extensive research study on accountable care organizations (ACOs). The goal is to identify more actionable benchmarks for an ACO to assess its performance by looking at episodes of care rather than the traditional actuarial view of benchmarks based on types of services.

Wide variation currently exists in costs per patient for numerous episode types. Many factors contribute to this variation, including differences in regional provider pricing, clinical practice patterns, and the underlying risks of the patients included in the sample. While many studies have examined the variation in per-episode costs related to price and practice differences, all struggle to normalize costs per episode across populations with different levels of underlying risk. We will be developing methods to address this need.

Read more…

Research ACOs

As Americans await the Supreme Court’s decision on the Patient Protection and Affordable Care Act (PPACA), many providers are moving forward with efforts to develop accountable care organizations (ACOs).  While not always well documented, this movement and other aspects of the PPACA raise questions for medical professional liability (MPL) insurers.

A new article by Derek Jones, “Medical Professional Liability: The Other Insurance Market Affected by Health Reform,” takes a comprehensive look at how ACOs and other reforms, such as the PPACA’s Patient-Centered Outcomes Research Institute (PCORI) and the Act’s Section 10607, may affect MPL insurers.

For more perspective on ACOs, check out this video.

Accountablity ACOs, Derek Jones, Healthcare Reform, medical professional liability