In this week’s issue of Annals of Family Medicine, I’ve published an article that describes how independent primary physicians, with the right tools, are best suited to provide quality care in a value based health care system. More than half of all family medicine physicians are still caring for patients in practices with 5 or fewer providers. But, how can these doctors compete against large hospital groups, especially as hospitals continue to buy up doctor groups?

In the article, I discuss how independent primary care physicians can thrive in the new health care economy if they come together with other like minded practices that are dedicated to value based care and the virtues of a small, personalized practice. By forming an accountable care organization, independent doctors can stay independent, take advantage of the network effect, and continue to provide quality care to their patients.

The article also reflects on what we’ve seen and learned in the 18 months since we started Aledade. If you are interested, please read the article, which can be found at

When Aledade launched in June of 2014, we were a small, passionate staff fundamentally committed to a big idea: that independent primary care providers were uniquely positioned to help lead the biggest shift in the American health care system in more than a generation. We believed that if these doctors received practice support, technology, analytics, and regulatory expertise from a true partner, they could reassume their role at the center of their patients’ care – delivering the highest-quality care while bringing down costs across the health care system.

By the beginning of this year, we had partnered with 80 primary care doctors across four states, taking accountability for the care of more than 20,000 Medicare patients. Throughout 2015, we helped these physicians increase vaccinations and preventive care for their patients, decrease hospitalizations, and make investments that will keep patients healthier for years to come. We equipped these doctors with customized platforms that tie together EHR and Medicare claims data, enable them to connect with their high-risk patients, and provide instant notifications when their patients are admitted, discharged, or transferred between care facilities.

But we knew that 2015 would simply be the start.

So today, we are proud to announce that the Center for Medicare and Medicaid Services (CMS) has officially recognized five new Aledade ACOs:

• A Kansas-based ACO contracting with Kansas Foundation for Medical Care, Inc. for practice support
• A West Virginia-based ACO, centered around Charleston, in partnership with the West Virginia Medical Institute
• A Central Florida-focused ACO, partnering with Primary Health Partners LLC
• A Louisiana-based ACO, in partnership with the Louisiana Health Care Quality Forum
• A Mississippi and Tennessee-based ACO, partnering with the Mississippi Academy of Family Physicians, Arkansas Foundation for Medical Care, and Q Source

Beginning January 1, 2016 – less than 18 months after we started this journey – our team grew to include more than 700 physicians in over 110 practices, Federally Qualified Health Centers (FQHCs), and Rural Health Centers (RHCs) across 11 states. We are now responsible for nearly 100,000 Medicare patients, and more than $1 billion in health care expenditures.

In the year and a half since we founded this company, the health care system has accelerated its shift towards outcome-based health care. Early last year, the U.S. Department of Health and Human Services (HHS) set a goal of tying 50 percent of fee-for-service Medicare payments to quality or value through alternative payment models by the end of 2018. It was the first time in the history of the Medicare program that HHS has set explicit goals for alternative payment models and value-based payments. In April, the Medicare Access and CHIP Reauthorization Act set a foundation for Medicare’s outcome-focused future. Today, seven in 10 Americans live in an area served by an ACO.

As policy tailwinds have delivered additional momentum, we’ve continued to grow our team and doubled (and tripled) down on our emphasis on preventive care, our development of customized technology for Aledade practices, and the uniquely aligned financial partnership we have with our physicians.

In 2016, we will continue to expand initiatives that have already helped improve our doctors’ practices:

• Care management interventions for specific chronic conditions.
• Behavioral health interventions to support patients battling depression and anxiety.
• Tools and approaches to help ensure patients get the care that aligns with their personal goals at end of life.
• Skilled nursing facility (SNF) transition strategies to ensure patients receive effective care in a SNF and safely return home.

In 2014, Accountable Care Organizations saved Medicare nearly a billion dollars while improving on 80 percent of CMS quality measures – and most observers agree that both the quality and savings effects of these organizations will only grow as ACOs mature. Recent surveys have confirmed what doctors across the country already know – the health care industry’s move towards value-based payment is now inexorable. The question for most physicians – especially those in small, independent practices – is how to navigate this new health care economy.

Aledade was founded to provide an answer – and a resource – for these very doctors. Today’s CMS announcement proves that the appetite for our model, our team, and our services continues to grow. So too does our commitment to our practices and their patients. As we move into next year, our greater scale will enable us to draw more insights about the best way to keep health care costs down and the health of our patients up.

Earlier this year with the passage of the bi-partisan Medicare Access and CHIP Reauthorization Act (MACRA), Congress created a system for Alternative Payment Models (APM) to replace the Medicare fee-for-service model over the next decade.  In the next several years, shifting financial incentives will move the majority of Medicare providers away from the coin-operated model of health care, and towards a system oriented towards value and outcomes instead of volume.

It will come as little surprise that at Aledade, we believe that the best alternative payment in Medicare actually predates MACRA’s passage.  The Medicare Shared Savings ACO Program, launched in 2012, saved Medicare nearly a billion dollars in 2014 while improving health care quality.  The program incentivizes providers to practice population health, and in the model we favor, empowers primary-care physicians to take more control of their patients’ health.

Today, accountable care already covers more people than any other potential alternative payment model. This gives ACOs the opportunity to be the vanguard  n the transition away from fee for service to value driven health care. For that reason, it is fundamentally important that the MACRA ensures accountability and real investment by ACOs by properly aligning financial risk. With MACRA, Congress clearly intended for ACOs to take more than a nominal financial risk, and sought to weed out ACO squatting and other phantom attempts at value based care.

Last month, we submitted our comments as CMS propagates regulations to put MACRA into effect.  While our comments were submitted in technical language, our position is simple – in order for MACRA to truly motivate a move to value-based care, providers cannot simply move to value-based care “in name only.”  We must move beyond a box-checking, compliance mindset – and to do so, providers participating in value-based care must take on some financial risk.

For that financial risk to mean something, providers must be motivated to take action. One-sided risk leaves the amount of investment and therefore the amount of financial risk up to the individual ACO. Some ACOs make major investments in population health, while other ACO ‘squatters’ make minimal investments with a mere compliance mindset, and just wait to see which way the wind blows. Three to four years from now when APMs are in effect, the ACO model will need to evolve to ensure a higher level of commitment from all participants in downside risk. By ridding the model of ACO squatters and others not committed to the model, we move further from fee for service and closer to value.

This means that CMS must lay out a roadmap for ACOs to evolve to two-sided risk, even if they begin as one-sided risk ACOs

The goal of downside risk is not to encourage payers to recoup losses.  Instead, the goal is to align the interests of the ACO and payer – or, in the case of Medicare, society’s interest. Rather than setting downside risk in its current mostly symmetrical fashion as that feels only fair, CMS and other payers should set downside risk asymmetrically – the goal should be motivation, not fairness.

In our comments, we argued that CMS should create a two-sided risk model where the ACO is only responsible for 20 percent of shared losses. Even this percentage should still meet the 15 percent threshold for more than nominal financial risk for smaller organizations. Larger organizations should take on higher percentages of downside risk until their level of risk becomes significant.

Lastly, ACOs must be able to be population health organizations, not simply insurance organizations. Aledade now partners with over 700 primary care physicians – and all of them understand they are practicing population health, a drastic departure from the system under which they have operated for years. However, our model also ensures they do not feel responsibility for events they can neither control nor influence.

We have seen physicians and their staffs launch crusades to bring their most non-compliant patients into the office, and keep them out of the emergency department.  Because of the sustained efforts of Aledade physicians and their staff, we are seeing patients that haven’t come in for physicals in years working on their own health and improving medication adherence. Every week, we hear stories of doctors managing patients’ transition of care, creating personalized care plans, and making investments in preventive care that will prevent future problems.

However, no action that a primary care doctor can take will influence whether a patient develops unavoidable cancer. By using a prospective risk scoring methodology, and by not allowing for risk scores to rise for the ACO, CMS moved insurance risk to ACOs and prevents the move to two-sided risk because they fear of up coding. The goal of any risk scoring methodology must be accuracy, and no model that is artificially capped can be accurate. If an entity is financially responsible for cancer they become an insurance company, not a population health management organization. And that is a business that most physicians do not want to be in. The goal of risk scoring must change to be the most accurate assessment of risk in order to let population health be the driver of savings and losses not chance.


The success of health care is tied to the success of the APMs and ACOs – we acknowledge this reality, and our comments reflect it.

In order to continue the evolution of ACOs, CMS should:

  • Set more than nominal financial risk at 15 percent or more of the participating health care providers Medicare fee for service payments
  • Avoid turning ACOs into insurance companies by changing the focus of risk scoring from protection against up coding to ensuring the accuracy of the risk score
  • Explore asymmetrical savings and losses splits between ACOs and CMS with the goal of minimal downside risk needed to motivate ACOs and protect against the continued existence of ACO squatters

We look forward to continuing our conversation with CMS on these and other issues – and working collaboratively to ensure the future of value-based health care.

Fair warning these are our comments on federal regulation as written for CMS. We will be following up with a blog later this week.

November 17, 2015

Andrew M. Slavitt
Acting Administrator
Centers for Medicare and Medicaid Services
Department of Health and Human Services
200 Independence Avenue, SW Room 455-G
Washington, DC 20201

Re: CMS-3321-NC – Request for Information Regarding Implementation of the Merit-Based Incentive Payment System, Promotion of Alternative Payment Models, and Incentive Payments for Participation in Eligible Alternative Payment Models.

Dear Administrator Slavitt:

Today, Aledade, Inc partners with over 110 primary care physician practices, Federally Qualified Health Centers (FQHCs) and Rural Health Centers (RHCs) in accountable care. By January 1, 2016, we will have nearly 100,000 Medicare beneficiaries in the Medicare Shared Savings Program (MSSP) across 11 states. We are committed to outcome based approaches to determine the value of health care. We are committed to using technology, data, practice transformation expertise and most importantly the relationship between a person and their primary care physician to improve the value of health care in the United States.

Primary care physicians are responding to the opportunity of accountable care. With over 700 physicians partnering with Aledade we see every day the difference that a viable financial model that rewards health makes in the attitudes of physicians, nurses, office staff and beneficiaries. The energizing effect that accountable care instills in the primary care physician can not be over stated. The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) is an opportunity to solidify the health care transformation that has begun in this country. However, designing the Merit Incentive Payment System (MIPS) and Alternative Payments Models (APM) is one of the most challenging policy issues the Centers for Medicare and Medicaid Services (CMS) has ever faced. The seeds planted by the Affordable Care Act have the potential to thrive in MACRA, unfortunately they also have the potential to wither.

For these reason we are grateful that CMS put forward its request for information. The success of health care is tied to the success of the APMs. Aledade is one of the largest partners to primary care physicians in accountable care in the country and we are pleased to put forward our recommendations as CMS implements MACRA. Thank you very much for your consideration as we move together through this exciting time in health care. Please feel free to follow up with me or Travis Broome ( if you or your staff have questions or would like to explore these issues further



Farzad Mostashari, MD

CEO and Co-Founder, Aledade, Inc

Alternative Payment Models

More than Nominal Financial Risk

No other provision of MACRA will have as much impact on health care transformation as nominal financial risk. We believe this is the key factor that will decide both participation in and success of APMs. Too much risk and many providers will not participate in APMs. Too like risk and the APMs will not be as effective at improving health care delivery and health in the country as they could be. Striking this balance is the most important decision CMS faces in implementing MACRA.

Before deciding on what amounts to more than nominal levels of financial risk, CMS must first define financial risk. We put financial risk into two broad categories. The first category is downside risk of the APM itself. We define downside risk as a provision in the APM that requires the health care partner in the APM (or entity as described in MACRA) to pay Medicare or other payer if costs and/or quality do not meet certain criteria. For example, in the MSSP Track 2 and Track 3 have downside risk, while Track 1 does not have downside risk. The second category is the investment risk required to participate in the APM. We define investment risk as not a provision in the APM, but rather the investment the entities’ must make in order to participate in the APM. For example, in the MSSP, ACOs are required to pay for administration of the Consumer Assessment of Health Care Providers (CAPHS) survey simply to participate and they invest much more to improve health. This is an investment that is at risk to succeeding in the MSSP.

We believe that the to continue the work of transforming health care CMS must define financial risk as downside risk in the APM itself. Both the ACA and MACRA clearly intend for entities to eventually assume downside risk. If CMS were to define financial risk as the risk to the investment entities are making, then MACRA would not require more of entities than the MSSP does today. If that were the case, there would have been no need for the more than nominal financial risk provision at all. Furthermore, MIPS puts up to nine percent of the eligible professionals’ fee for service payments at risk. Combine that with the five percent bonus qualified participants in an APM can receive if their entity qualifies and MIPS could be seen as the more advanced model if CMS were to define financial risk as risk to investments as opposed to risks for accountable care.

Much has been written about the motivating power of downside risk and there is no reason to believe that it does not motivate in a positive way. The lack of participation in downside risk in MSSP to date is a clear signal about how serious entities consider downside risk and the effect it would have on organizations that take on downside risk. However, just as the lack of participation is a signal of its effectiveness it should also be a signal to CMS of the need to strike the right balance in using MACRA to further incentivize providers to two-sided risk. Finding this balance so that we can move from today’s state to a desired state by when the performance years for APM bonus and MIPS occur is a difficult balance with no true correct answer.

To strike this balance we recommend that CMS focus on the commitment that each entity is making. We recommend that CMS require that for an entity to qualify as participating in an APM it must be in a contract that has a transition to a downside risk component within the contract itself. For example, a five-year contract that has two years of one sided risk and three years on two-sided risk would qualify. However, an APM that has a three-year contract of one sided risk and a requirement that if the entity renews it would have to renew in a two sided risk contract would not qualify. We recommend that to access the APM bonus and to be excepted from MIPS the entity must have made a contractual commitment to two-sided risk. Anything less allows health care providers and organizations to delay making a true commitment to accountable care. This delay is unacceptable and unaffordable if we are truly to succeed in transforming health care.

Yet we believe that a transitional contract is needed to strike the right balance in today’s environment. If the performance year is to be 2017 or 2018, the future is just around the corner. Requiring all entities to be in two-sided risk to qualify by either of those years will not strike the right balance and health care providers will simply not participate in APMs in the numbers that are necessary to transform health care. To strike the right balance, CMS will need to develop a new contract for MSSP or other APM that is a longer-term commitment, that clearly articulates future expectations of downside risk, focuses on success in population health and avoids the transfer of insurance risk from CMS to entities and their health care provider members.

Currently, MSSP offers too large a jump between one sided risk and two sided risk. Going from one sided risk to being on the hook for 50 percent of losses (up to 15 percent of the total cost of care) is a bigger transition than nearly all entities have been willing to make. CMS could lower the shared losses percentages with entities being able to only be responsible for 20 percent of the losses in the friendliest of downside risk option. CMS must also increase the accuracy of risk adjustment to avoid transferring insurance risk to health care providers and entities. A clear litmus test for this issue is whether the entity is financially responsible for a person developing cancer in a performance year. In the current MSSP, ACOs are financially responsible for this as it is accounted for in neither risk scoring nor benchmarking. It is this transfer of insurance risk that concerns the physicians we work with more than what the shared losses rate is or what the market for re-insurance is.There is no action CMS could take that would encourage the greater uptake of downside risk than to allow risk scoring to be dynamic and to be a leader in the improvement of risk scoring accuracy.

We acknowledge that there will always be some transfer of insurance risk in an APM. Other ways CMS can encourage the uptake of downside risk is to offer limited segmentation of health care areas based on the ability of health care providers to influence cost and progression for purposes of sharing in losses. For example, management of long-term, slow progressing chronic conditions is an area of great provider influence than trauma, accidents, and other sudden, acute conditions. Varying the shared losses rate based on provider control is another way CMS could demonstrate to health care provider that the APM is about accountable care and not transferring insurance risk to health care providers. Finally, CMS could work with the private sector is create a market for re-insurance giving both re-insurers and APM entities experience with the market for a few years at which time CMS could gradually reduce their support for the market.

We recommend that CMS create a new option in the MSSP to serve as the entry point for entities wishing to qualify as APMs.

  • 5-year contract with 2 years one sided risk sharing in savings at 50 percent entity and 50 percent CMS and 3 years two sided risk sharing in savings at 60 percent entity and 40 percent CMS and sharing in the losses at 20 percent entity and 80 percent CMS.
  • Stop losses on both the individual beneficiary and the population as a whole can be taken from the existing two-sided risk options in MSSP
  • Risk scores should be dynamic and not artificially capped with CMS monitoring for abuse.
  • CMS should model and pilot segmentation of downside risk exposure based on health care provider control

Having defined financial risk and struck a balance on creating an APM that allows for commitment to downside risk while remaining realistic about the current state of accountable care, CMS must then define more than nominal. We hold it to be self-evident that what is more than nominal to one entity might be downright miniscule for another entity. To set one fixed dollar or fixed percentage of total cost of care standard for more than nominal financial risk for all entities is to give large organizations a pass on financial risk and to expose small organizations not to merely more than nominal financial risk, but massive financial risk.

We believe that MACRA itself provides an excellent guide on how to define more than nominal risk to be considered a QP. We have already established that we believe that Congress intended for participation in an APM to include more risk than participation in MIPS. Combining the 9 percent downside risk to fee for service payments in MIPS with the 5 percent bonus for APM participation we believe that MIPS participation constitutes a 14 percent risk to the value of fee for service payments of eligible professionals. In order for an entity to qualify as an EAPM then the worst case scenario financial liability to CMS due to the downside risk must be at least be the value of 15 percent of the fee for service payments made by CMS to all of the health care providers that make up the entity.

For example, if CMS makes fee for service payments (i.e. all payments from Part A and Part B) of $100,000,000 to the health care providers of the entity seeking to qualify then the worst case downside risk to that entity must be at least $15,000,000. By creating the same level of financial risk to all entities CMS encourages participation of entities of all sizes and creates a level playing field for small, independent health care providers and large organizations alike. In the case where participation in our proposed entry level downside risk track does not meet this nominal threshold the entity would have to choose one of the already available riskier tracks to qualify as an entity participating in an APM.

By requiring a commitment to downside risk yet setting more than nominal financial risk as just slightly riskier than MIPS participation we believe CMS can strike the right balance between advancing health care transformation through accountable care and getting enough participation in APMs that the transformation spreads throughout the whole health care system.

EAPM Entity Requirements

In addition to nominal financial risk, MACRA includes other requirements for an entity to be an EAPM. We agree with the requirement of use of certified EHR technology. We believe and it has been our experience that EHR technology is a perquisite for sustained success in any accountable care model. We recommend that CMS simplify this requirement by adopting the Office of the National Coordinator definition of certified EHR technology as it pertains to being eligible for EHR Incentive Program in the performance year in question. Requiring use of certified EHR technology also creates desirable parity with participation in MIPS.

We also support parity with the quality measures. The quality measures should be an integral part of APM that the EAPM participates in. There is no need for additional quality measures beyond those used by the APM. All APMs should include an acceptable set of quality measures. Every APM should seek to be uniform in their quality measurement and justify variation in measures. We do believe that most APMs will have some level of justifiable variation.

We wholeheartedly support the principles of quality measurement outlined in the Health Care Transformation Taskforce comments to which Aledade is a signatory. We take this opportunity to highlight the principle of public accountability. In distinction to MIPS, in the APMs it is particularly incumbent on policymakers and risk-sharing providers to reassure beneficiaries and the public that reductions in cost are not associated with stinting on needed care- that protection and transparency must be a key goal of quality measurement in APMS.

Physician Focused Payment Models

The core principal in evaluating any payment model is whether it improves health, health care and/or lowers costs better than fee for service. Models should also serve as experiments to improve or fill gaps in existing APMs. The Committee should not approve models that are just easier or less risky than APMs. An approved PFPM should identify gaps that address a specific provider or beneficiary population or seek to improve on an existing APM. For example, our earlier recommendation to experiment with segmentation of downside risk exposure based on health care provider control. PFPM could serve as a platform for determining the right segmentation and defining provider control for different specialties. In this instance the PFPM would be built on an APM rather than a substitute for an APM.


EP Identifier

We acknowledge the difficulty is determining a clinically relevant group of physicians, facilities and other health care providers. NPI accurately identifies individual providers, but as of yet no identifier successfully identifies a clinically relevant group. The Employer Identification Number (EIN) for organizations is used in many CMS programs, but as its name implies it is designed to identify an employer for tax purposes. This obviously creates potentially competing considerations between the tax and business structure implications of an EIN and clinically relevant aspects of health care providers coming together as a group.

We believe it is important to the success of both MIPS and APMs for health care providers to create groups that include only a subset of EINs. We have observed health care providers creating new EINs and therefore new groups for purposes of CMS programs simply to make the groups more clinically relevant. By doing this they make the group less relevant for tax and corporate compliance reasons. Creating an identifier for groups based solely on clinical relevancy is a needed step whether that identifier is the organizational NPI or a new number.

As with quality measures we recommend the principles outlined in the Health Care Transformation Taskforce:

  • Provider discretion to create the group that makes the most sense clinically and better prepares them for APM participation,
  • Maintaining the link between performance year and the year of effect of MIPS at the individual provider level,
  • Quality is attributable to individual provider level unless something in the design of the measure prevents it.

Low Volume Threshold

While not referenced in the RFI, we believe the low volume threshold is very important consideration for making the decisions about MIPS that are addressed in the RFI.  As those eligible professionals (EPs) who are in MIPS will be graded on total costs and those costs will include costs generated by EPs under the low volume threshold, it is important to consider both constituencies in determining the low volume threshold. The first constituency is those EPs who would be exempt from MIPS under the low volume threshold. The exemption exists for two reasons: small number concerns in the accuracy of the MIPS score and to alleviate burden in reporting on EPs so they do not decide to forgo the Medicare population altogether. The burden question can be attacked on several fronts not just an exemption due to low volume and we would encourage CMS to wait on valuing the burden reduction in determining the low volume threshold until more details on MIPS are available and can be commented on. For the small number variation, we encourage CMS to conduct statistical analysis using the data already available through the value based modifier program to determine what the minimum valid threshold would be to generate valid scores. We urge CMS to use this number and attack burden of reporting through other means due to the considerations of the second constituency.

The second constituency is the EPs under MIPS. We anticipate that they would be accountable for total costs not just their own costs. This means that costs generated by EPs excluded from MIPS will contribute to their costs. Now you have two participants with different financial incentives. The MIPS EP is financially tied to their MIPS score while the exempt EP is only tied to increasing their FFS revenue. For this reason, we believe that the low volume threshold should be as low as it can be and still produce a valid MIPS score for the EP so that as much of the cost as possible is covered either by MIPS or an APM.

Finally, as part of this consideration of both constituencies we encourage CMS to model all three aspects of low volume: patient panel, number of items/services and costs. We believe CMS will find that at a minimum consideration of both patient panel size and costs will be necessary. The measure of total costs is the most critical component of MIPS if it is to be successful in incentivizing better value in health care. Every EP excluded from MIPS due to low volume is a missed opportunity to impact value.

The use of number of beneficiaries, number of items/services or costs applies across many aspects of MIPS and APMs. We ask that CMS model all three when proposing how calculations dependent on any of the three.

Thank you for the opportunity to provide input as CMS begins to consider the policies that will implement MACRA. We look forward to contributing to the development of these critical policies.

Our office hasn’t been able to stop talking about Michael Stein’s essay in last week’s Washington Post.  In his piece, Dr. Stein details the negative pressures today’s fee-for-service medicine system places on him – namely, the push to see as many patients as possible in a given day.

The essay provides various reasons for this pressure: Dr. Stein’s status as an employee of a large medical group, where he is instructed to conform to the assigned length of the patient visit; a need to react to the acute problems of the patients who come into the office that day instead of acting proactively; and the (well-intentioned) desire to accommodate patients who want same- or next-day appointments.

But the fundamental issue with this approach is captured by Dr. Stein towards the middle of his essay.  He writes, “[t]he origin of the 15-minute visit is capitalistic, money tied to a clock…[the length of the average primary-care visit] remains driven by arbitrary 20th-century insurance service codes, based on diagnostic complexity, that dictate physician payment.”

The issues detailed by Dr. Stein are familiar for far too many primary care physicians – myself included. Working in fee-for-service medicine, I often found myself behind schedule, pressed to make up time during a “less complex” visit that may turn out to be every bit as nuanced.  It is my privilege to spend a few extra moments with a patient to delve into the potential underlying environmental or personal causes of her condition, or tease out connections that would lead to more coordinated, more effective, care.  But these extra moments are not always mine to give, and inevitably inconvenience the patients who follow.

In this way, the 15-minute visit structure sidelines the patient-physician relationship and becomes a zero-sum game – any excess time spent trying to improve one patient’s health through communication or a comprehensive approach to care means a patient later in the day might not receive the same attention, or might hold back explaining a problem, frustrated at having been kept waiting.

Accountable care in general – and our approach in particular – aims to keep physicians’ focus on patients, not the clock or computer screen.   While value-based arrangements can’t completely eliminate the time crunch felt by doctors, shifting emphasis from the number of services delivered to the outcomes achieved reorients how doctors can approach daily appointments and a population of patients.  In all of our Aledade ACOs, we implement initiatives designed to provide the space for physicians and their teams to avoid the situations detailed by Dr. Stein:

  • Team-Based Care: All Aledade partner practices elevate team-based care and re-examine what can be accomplished by capable physician assistants, nurses, and other support staff. Engaging nurses and medical assistants as partners in quality care leads to fewer missed flu shots, improved coordination of care, better reconciled medication lists, fewer errors – and more time for the Aledade doctor to connect meaningfully with the patient.
  • Medicare Annual Wellness Visits: When a practice joins Aledade, one of our highest priorities is working with the physician and staff to bring in eligible patients for Medicare Annual Wellness Visits (AWVs). AWVs, fully covered by Medicare with no costs to patients, leverage team based care and provide an opportunity for a doctor and patient to discuss a patients’ risk for falls, depression, and a host of potentially significant health issues, and develop personalized care plans for problems before they become serious.
  • Focusing on high-risk patients: We work with our partner practices to proactively identify – through EHR and claims data analysis – the highest-risk patients in a doctor’s population. For these patients, we explore wrap-around approaches to care, examining external factors affecting health and integrating social services.

Each of these initiatives empowers doctors to spend more time thinking about the best way to care for patients, instead of worrying about the next appointment.  As Stein writes, “[A] hurried, task-oriented approach doesn’t accommodate the meandering, overlapping, widening issues of patients.”

We want our doctors to be focused on exactly that – the complex ecosystem that each patient represents.  So we’re working to change the equation, and add a few extra minutes to the clock.

The focus of my career in health care – conducting research on patient safety at the Joint Commission; working as Program Manager for State-level HIE Project at the AHIMA Foundation; and most recently, serving as Interoperability Portfolio Manager at the U.S. Department of Health and Human Services Office of the National Coordinator for Health IT (ONC) – has been empowering providers and consumers with information they can use to drive better quality of care, and better health outcomes.

At ONC, I led the development of our Nationwide Interoperability Roadmap, creating a strategic path forward to give providers the access necessary to get the most out of their electronic health records (EHRs), apply analytics to drive population health approaches to care, and identify opportunities for preventive care. But a roadmap is only as valuable as the execution and implementation that follows its development. Translating that work into real-world, replicable action on the front lines of medicine is equally, if not more, important.

That’s why today, I’m pleased to announce I’ve joined Aledade as the company’s Director of Health Information Exchange.

In this role, my immediate focus will be ensuring that all Aledade practices receive instant admission, discharge, and transfer (ADT) notifications when patients moves into, out of, or between hospitals and other care facilities. Already, the Aledade team has been a leader in optimizing doctors’ EHR platforms, integrating Medicare claims and Health Information Exchanges, and creating intuitive platforms that assist physicians with patient outreach, thereby identifying opportunities for reducing unnecessary health care costs.

Nowhere is the link between the flow of actionable information and the avoidance of unnecessary costs more directly connected than during transitions of care. When a primary care team can be made aware that one of his or her patients is being admitted to or discharged from a hospital, or transferred between other care facilities, it enables that team to take proactive steps – sometimes as simple as calling that patient on the phone. But these small – and common sense – actions can have huge impacts. If a patient is contacted by a doctor within 48 hours of being discharged from a hospital, studies demonstrate that patient is more likely to adhere to medication instructions, and that he or she is significantly less likely to be readmitted to the hospital in the next several months. Sometimes, it’s as simple as having the ability to reassure a patient, and answer questions borne of confusion.

But while ADT notifications will be my initial focus at Aledade, they are just the beginning. Aledade’s mission – placing primary care physicians back at the center of their patients’ care – is supported by a combination of people, process, and technology. The goal is to build a comprehensive, holistic picture of a patient’s health, instead of reacting to acute issues once they arise. Making sure real-time information flows to providers seamlessly when patients are moving between care facilities is a foundational piece of that puzzle.

Right now is a unique time in health care. The integration of EHRs, analytics, and other technology has flooded physicians’ practices with a tsunami of data. For too many physicians though, this information is just that – an overwhelming flood, that’s making the practice of medicine more complicated and more burdensome. But synthesized smartly and presented intuitively, we can turn the flood of data into a stream of actionable information – a stream we can harness to power a better model of care.

That’s my job at Aledade – giving doctors and care teams the power to deliver better patient care, and improve health outcomes through technology and processes. It’s an honor to be here, and I can’t wait to continue – and expand – the work this team has started.

Late yesterday, CMS announced the preliminary 2014 results of the Medicare Pioneer and Shared Savings ACO Programs.  Combined, successful ACOs in these two programs reduced held health care costs nearly a billion dollars against Medicare projections, while simultaneously improving on 80 percent of CMS quality measures.  The major takeaway: these programs are improving the quality of care for patients, while significantly reducing health care costs.

The better news?  It looks like they’re just getting started.

Population health is a long term effort – and the financial rewards of the approach accumulate over time.  When a primary care physician guides a person through their complex medication regime, eliminates redundant or dangerous medications and increases adherence, the actions don’t necessarily generate savings today, or tomorrow, or even next month. But a year from now those actions could save thousands of dollars. Two years from now they could save a life.

Yesterday’s results reinforce that idea. Unsurprisingly, Medicare ACOs in existence longer generated, on average, more savings. Population health really pays off – especially over time. The Pioneer ACOs and the ACOs that started in 2012 had the highest success rates (55 and 37 percent respectively). Yet even they have only been in existence for two and a half years – a beneficiary who was 67 when the ACO program began has not yet turned 70.  That individual’s primary care physician will care for that person for the next two decades – and investments in the last 30 months will create benefits – in absolute health, and in cost savings – for years to come.

Some are already pointing to the overall success rate of ACOs in earning shared savings – 29% — as evidence of a letdown; a sign that the ACO program isn’t changing health care fast enough.  At Aledade, we think that view is short sighted.  From a population health perspective these results, in a program with less than three years of results, are encouraging.  As providers become more familiar with population heath and the value of EHRs; as systems improve interoperability and state health information exchanges become more effective; and as patients acclimate to preventive medicine, we expect both the rate of ACO success, and its scale to grow.  Participation in the Shared Savings programs continue to grow – Aledade alone tripled in size over the past year.  Most importantly, these programs are rewarding organizations that take a population health mindset, making investments today to create savings for many years to come.

Finally, let us always remember that value is not just about costs. Higher quality can generate more value even if costs do not go down. ACOs in the Shared Savings Program had better quality than average in 18 of 22 shared measures. But again the results highlight the value of ACO maturity — those ACOs in the program for two years improved 27 of 33 quality measures. The value of population health care can’t be measured in savings alone – these quality measures mean that Medicare beneficiaries are getting better care – they are less likely to fall in their homes, have complications from diabetes, or be admitted to a skilled nursing facility.  No matter what percentage of ACOs are generating shared savings, a program that induces these effects is a successful one.

Earlier this week, we announced that Aledade has applied to CMS to form new ACOs in seven new states beginning January 1, 2016. Since Aledade launched last June, we’ve partnered with over 100 independent primary care practices in 11 states, and are now responsible for the health of more than 80,000 Medicare beneficiaries – exceeding goals we set for ourselves just two months ago.  In 14 months since our founding, Aledade partner practices have increased preventive care visits by 400 percent, and are administering two-and-a-half times more vaccinations to patients who need them.  More than nine in ten Aledade practices receive real-time notifications when patients are admitted or discharged from a local hospital, and 95 percent of partner provider 24/7 access to an on-call doctor.

But while we’re extremely proud of these statistics, they only tell part of Aledade’s story.

As Executive VP for Provider Networks, much of my work for Aledade occurs outside the four walls of our Bethesda office.  Especially over the last nine months, I – and many other members of our team – have been on the road.  We’ve visited hundreds of primary care practice around the country, explaining our partnership ACO model and offering ourselves as navigators for doctors managing the rapidly changing landscape of health care. These doctors know the shift towards value-based care is here, and many of them are eager to lead the way.  But so many are worried they lack the technological, regulatory, and financial expertise to succeed in this brave new world.  For these doctors, the request is straightforward:Show me the rules of the road, help me take the wheel, and let me focus on keeping my patients healthy.

Our growth over the past 14 months has been driven by the overwhelming demand we’ve seen from these doctors for a partner that can help map the constellations of various value-based care programs, and navigate what it means for their practices.  From Lawrence, Kansas, and Wheeling, West Virginia, to Memphis, Tennessee and Orlando, Florida, these physicians are looking for a strong partner who can make participation in these programs as easy – and as rewarding – as possible.

This story can’t be captured in growth metrics alone – it’s the story of family physicians who have been in their communities for years or even decades, and are eager to bring a new model of medicine to the patient populations.  Connected with our team and equipped with tools to practice population health for the first time – often in ways that are mind-bogglingly common-sense – many of these doctors are already making significant improvements in the lives of their patients.

In the coming months, we’ll be featuring many of these All-Star Physicians – their knowledge of, and relationships with, their patients are two of Aledade’s biggest drivers of success.  But on the occasion of our expansion announcements, here are a couple of examples of how the work of our partner physicians is playing out – not in terms of dollars saved or quality measures met, but in the lives of individual patients:

  • Just a couple of weeks ago, one of our ACO Partner Practices in Delaware was able to prevent four unnecessary Emergency Room visits in one week — simply by offering patients same-day visits. By accommodating patients in the office, the practice was able to save the patient hours of ER waiting time, prevent duplicate testing and possible hospital admissions, and avoid needless stress for these patients and their families.
  • To help prevent hospital readmissions, an ACO Partner Practice in Maryland is ensuring that patients who visit the emergency room are seen in the practice the next day.
  • An ACO Partner Practice in Arkansas reached out to a patient and encouraged him to come in for a Medicare Wellness Visit. During the visit, the primary care physician determined that the patient had a significant risk of falling. The ACO is now able to intervene by installing a hand rail at the patient’s home, which will minimize the patient’s fall risk and potentially prevent a serious injury and hospitalization.

These are just a few examples that highlight the ways in which Aledade’s work is lowering costs while improving the lives of patients nationwide.  For most of our providers, these changes are simple and intuitive – and made possible because of the technology platform we’re able to provide.  But these changes make measurable differences in the lives of patients – keeping them from unnecessary visits to the ED, or easing their transitions from a hospital stay.

As we say around the office almost every day (at least on the days I’m actually in the office), our work has just begun.  Our goal has always been empowering doctors to thrive in the new health care landscape.  This week’s news is evidence that physicians are responding to our partnership ACO model.  But the impacts are being felt by patients most of all, thanks to the work of our partner docs.

When my co-founders Mat Kendall, Edwin Miller, and I launched Aledade last June, I wrote that our mission was simple: empowering doctors on the front lines of medicine to put them back in control of health care—and rewarding them for the unique value they create. Today, a few days shy of our first birthday, we are announcing that we have raised $30 million in a funding round led by ARCH Venture Partners, and including our Series A funding partners at Venrock. This investment is a testament to the growing demand for our technology-enabled services, and to the rapid progress we have made in creating a platform for doctors to manage the new value-based healthcare economy. But most importantly, it’s a commitment to long-term thinking.

First, we have tapped into a huge unmet need and a growing demand for our healthcare technology services. We hand-picked and signed up 26 practices within weeks of starting the company, and have now established unique partnerships with over 100 primary care practices in 9 states. These practices serve nearly half a million patients, and our multiple accountable care organizations will soon be managing the total cost and quality of care for over 75,000 Medicare patients.

Everywhere we’ve gone – from Orlando to Wichita, Wilmington, and Little Rock – our team is meeting independent primary care doctors eager to be on the front lines of the biggest health care transformation this country has seen in our lifetimes – and hungry for the tools and support to succeed in the new health care economy. All of them have realized that rapid changes in their industry – from the implementation of electronic health records to the shift towards outcome-based reimbursement – require them to rethink the way they’ve operated for years. They want better health for their patients, and a more central role for primary care doctors in coordinating care. But they’ve also recognized that, to thrive in the new health care economy, they need a partner whose interests are aligned with theirs- to act in the patient’s best interest.

Second, we have built a platform for managing practice change. We have provided our doctors with strategic direction. We’ve advised on, and implemented, important workflow changes. We’ve optimized electronic health records to make it easier to do the right thing for the patient. We’ve shown doctors and their staff data they had never seen before. And we’ve built cloud-based technology to enable them to turn that intelligence into active patient care. As a result, we’ve seen preventive visits and immunizations soar, and primary care practices open their doors whenever their patients need them.

But we realize that these steps are merely the beginning of our work. We know that there is so much more we need to learn, so much more we need to build, and so much more we need to do.

We cannot solve today’s problems with the same short-sighted thinking that created them. Success at value-based care requires a break from the “coin-operated” immediate gratification of fee-for-service. It means longitudinal care, deeper relationships, and the vision and resources to play a long game- to invest in prevention and chronic disease management even when its pay-offs are delayed.

This investment means that we can meet the demand from physicians for our unique ACO model, and to expand the services we offer our partner practices. This money will help us build additional software and analytic tools for our practices; expanded service offerings; and add more on-the-ground support for our doctors and their staffs. It means being able to expand to private payers. Most of all, it means being able to invest in long-term prevention and chronic disease management, and patient engagement efforts that may take years to bear fruit.

I’m inordinately proud of our amazing team, and the effort and sacrifice that has brought us to this point. But today is not simply a day for celebration. It’s a day to renew our commitment to the mission that started this company, and redouble our efforts to empower primary care doctors to take control of the chaos and waste that comprises too much of our health care system.

We need to build a platform that will provide all the services our practices need, not just some; that will serve all of our practice’s patients, not just the ones on Medicare. That will deliver results not for one ACO, or for five, but for 50 – or 500. Better health at lower cost not just for one year, or three, but for a lifetime.

As Aledade’s CTO Edwin Miller said the other week, “It’s time to fire ourselves, re-hire some better versions, and take it to the next level.”

Let’s get to work.

Last week, Farzad laid out the big picture implications of the SGR Fix Legislation recently signed into law.

But now that one of the most absurd yearly rituals in politics permanently behind us, it’s time to look more closely at what has actually replaced Medicare’s Sustainable Growth Rate. After all, the goal hasn’t changed – the need for long-term Medicare sustainability. The SGR replacement strongly moves Medicare towards models that pay for value, instead ofservice activity.

See the two charts below — as you can see, fee for service payment is going to vary a lot from physician to physician in the future. The blue line represents an average quality/average cost provider who does not participate in an Advanced Payment Model. Projecting out to 2036, that provider will only be making fiver percent more than today. For some perspective – the same 2015 dollar, growing at two percent inflation, dwarfs the increase provided by the Medicare fee-for-service model.


SGR Effects Inflation

*Error bars are the value-based modifier through 2018 and in 2019 switch to the Merit-based Incentive Payment System, which participants in an Advanced Payment Model are excluded from. CMS has the ability to make payments even more variable. The chart shows only the minimal variation required by the law.

**The jump in 2019 for Advanced Payment Model is paid as a lump sum not as an add-on to each FFS payment and does not count against any benchmark in the Advanced Payment Model.

Taken together, these charts lead to an inevitable conclusion – there is no longer a viable, long-term path for doctors receiving fee-for-service reimbursements from Medicare.

By 2019, even the best providers participating in the fee-for-service Medicare reimbursement track will be left behind by modest inflation. While changes could always come, today, the sustainability of the Medicare system is now tied to the success of advanced payment models that focus on value.

Those models (MSSP, Next Generation ACO) are the future of Medicare. As baby boomers continue to retire, costs will be contained – one way or another. Now, we need to commit to ensuring that those costs will be contained through value generation, not less care. It’s the only possible path moving forward.