Reducing unnecessary care is becoming increasingly important in a value-based care environment. However, despite the high cost of unnecessary care, reducing it is challenging for providers. Here are several keys to reducing unnecessary care:
Increased documentation: By accurately documenting the care process across various sites and care systems, you can significantly reduce unnecessary care.
More transparent data: As performance data for healthcare providers becomes more available and accessible, transparency on both medical necessity and unnecessary care is a certainty.
Bigger payments and penalties: Enforcement actions and application of penalties will likely rise, and programs like bundled payments and accountable care will be judged by adherence to medical necessity and avoidance of unnecessary care.
Greater physician leadership: Efforts to reduce unnecessary care will likely increase the role and scope of the chief clinical officer. CCOs will now have more complicated duties and rely more on clinical data.
A report conducted by the Institute of Medicine researched if Medicare spending patterns largely have to do with geographic variances in post-acute care. The report was conducted by request from Congress to seek whether or not a geographically-based payment index made sense for Medicare. Ultimately, a push to support accountable care organizations, medical homes and bundled payment groups will achieve better outcomes instead of using geography to determine Medicare rates.
Over the past few years, the formation of Accountable Care Organizations (ACOs) has rapidly increased . Though there is no formal method to formally track their development, an estimated 300 commercial and government-sponsored ACOs have been established across the country as of November 2012.
In January 2013, the Centers for Medicare & Medicaid Services (CMS) announced 106 more organizations will be participating in the Medicare-sponsored ACO programs. A recent study estimated 25 to 31 million Americans are currently receiving health care services from an ACO and more than 40% of Americans live in areas where one is available. Most recently, Kaiser Health News reported the number of physician-led ACOs recently surpassed the number led by hospitals, becoming the largest backers of the payment and delivery model.
Accountable Care Organizations (ACOs) are also based around a strong primary care core, but ACOs are comprised of many “medical homes”—in other words, many primary care providers and/or practices that work together. Some have even dubbed ACOs the “medical neighborhood.” The difference is ACOs would be accountable for the cost and quality of care both within and outside of the primary care relationship. As such, ACOs must include specialists and hospitals in order to be able to control costs and improve health outcomes across the entire care continuum. ACOs by nature would be larger than a single medical home or physician’s office. There are many known benefits of the ACO structure over the medical home model, including the ability to better manage the care for a greater population of people with a larger budget. Being able to use the dollars across a wider range of patients and conditions allows for better overall cost management
In the traditional Medicare fee-for-service payment system, doctors and hospitals generally are paid more when they give patients more tests and do more procedures which, according to experts, drive up costs. Accountable Care Organizations (ACOs) wouldn’t do away with fee for service, but would create savings incentives by offering bonuses when providers keep costs down and meet specific quality benchmarks, focusing on prevention and carefully managing patients with chronic diseases. In other words, providers would get paid more for keeping their patients healthy and out of the hospital.
If an ACO is not able to save money, it would be stuck with the costs of investments made to improve care, such as adding new nurse care managers, but would still get to keep the standard Medicare fees. The Patient Protection & Affordable Care Act (PPACA) also gives regulators the ability to devise other payment methods, which would likely ask ACOs to bear more risk.