Last week, Dr. Bob Kocher and I took to the pages of the New York Times to detail a health care success story in Southern Texas.  In a region once featured for its extreme health care costs and poor health outcomes, a group of physicians motivated by new incentives in the Affordable Care Act has started to change the equation. The Rio Grande Valley ACO Health Providers achieved eye-popping savings in their first year – coming in $20 million below its Medicare baseline and receiving reimbursements totaling over $11 million while also achieving better health outcomes for its patient population.

The savings number made for an impressive headline.

But as is often the case, other information had to be left on the cutting room floor. We dive a little deeper into the RGV ACO below:

Finding the Right Types of Docs

Dr. Pena emphasized that the RGV ACO specifically chose the more aggressive “Track 2” in the Medicare Shared Savings Programs precisely because they wanted to place added pressure on themselves. Dr. Pena made the reasoning for that decision clear: “We had to motivate our physicians to change – so we had to make clear that failure wasn’t an option.” He also said that the composition of their providers was key. The ACO currently covers 8,500 Medicare patients, spread across 18 doctors and 20 midlevel providers, with plans to expand to between 13,000 and 15,000 patients by adding 10 new doctors in the next year. “We screen our doctors carefully – you really need the right people” – that means finding providers fully committed to their patients’ health, and fully prepared to embrace the necessary change.

And when all else fails, Dr. Pena admits that financial incentives can be an exceptional motivator. “I’d say, ‘Do you want to get a call from the ER or the patient?’” he recalled. “Because if you take the call from the patient and he or she doesn’t go to the Emergency Room, then we win.” One of the areas of which the ACO is most proud is its reduction of hospital admissions – down a full 12% since the ACO formed in 2012, and a major contributor to the total reduction in Medicare costs that they drove in the program’s first year- from $14,100 to $12,000 per year.  Some have argued that RGV ACO’s success is less impressive for having occurred in a high-cost area. We will address this question in a future blog- so stay tuned.

The Central Role of Information Technology

Dr. Jose Pena, Chief Medical Director of the Rio Grande Valley ACO, emphasizes that one of the first and most difficult tasks for the newly-formed organization was developing an IT infrastructure that would serve their needs.  “Using what was there wasn’t really an option,” says Dr. Pena, “so we built our own infrastructure.” Forgoing a single EHR solution, the Rio Grande Valley now operates on a mix of cloud and office-based systems. The ACO developed software to identify metrics from various EHR systems, migrate that information to the cloud, and view real-time performance of providers. “IT accounted for 40% of our costs,” says Dr. Pena, “but the importance of proper reporting – to our leadership team, and to CMS – was at the top of our list.” The ACO identifies its customized IT system as foundational to its success.

And it’s difficult to argue – the RGV ACO IT system has allowed the leadership to track outcomes across the board, seamlessly integrating information from seven different electronic health records across the ACO. The results for Diabetes control – one of the areas where RGV achieved its most impressive health outcomes and Dr. Pena noted as a special focus – place the ACO in the top 5% nationwide.

Domain: At Risk Population RGV ACO 90thPercentile
Subdomain: Diabetes Performance Rate Performance Rate
Beneficiaries with diabetes who met all measures 48.34% 38.05%
Hemoglobin Alc Control(HbA1c) (< 8 percent) 74.96% 80.63%
Low Density Lipoprotein(LDL) (< 100 mg/dL) 76.71% 67.04%
Blood Pressure(BP) < 140/90 (ACO-24) 82.14% 79.20%
Tobacco Non-Use(ACO-25) 93.52% 87.17%
Aspirin Use(ACO-26) 97.64% 93.10%


A Clear Vision: Leveraging Trust

Rio Grande Valley Health Providers was one of the first ACOs to recognize a critical asset that existed between primary care physicians and their patients: trust. While not easily quantifiable, it’s clear that the relationship between PCP and patient is unique; patients are more likely to listen to instructions from a doctor they’ve known for years than those from a hospital or health plan. RGV bet big on its doctors’ ability to change patient behavior – and that bet paid off.

But the commitment goes both ways – providers (like the one pictured below) have to repay that trust.  RGV instituted a cell phone program to ensure patients could contact their doctors; they started weekly times where patients could have medical instructions translated to plain English or Spanish; and they developed a home visit program to check on patients who couldn’t make it into the office.

This type of commitment to patient health had, for so long, gone unrewarded in the U.S. Health Care system. By flipping financial incentives, the Medicare Shared Savings Program and other accountable care initiatives – has provided an opportunity for doctors to align their desire to better patient health outcomes with their need for a financially stable practice. Rio Grande Valley has seized that opportunity and proved it is possible to step into the next phase of health delivery. Our goal is to make that opportunity available to independent primary care docs across the rest of the country.

On Tuesday, the comment period closed on the 2015 Physician Fee Schedule Proposed Rule and includes many proposals that will affect ACOs and value based purchasing.
Aledade is a company founded on the belief that the future of health care delivery lies in value-based models, not the fee-for-service system that currently dominates the U.S. market. To understand value, you must be able to measure quality as well as cost. While “pay for performance” and value modifiers are initial steps in the right direction, the most transformative effort to fundamentally change health care is the Medicare Shared Savings Program (MSSP). Aledade has recently formed two ACOs to participate in the MSSP and the excitement couldn’t be higher.

Moving Fast on CQMs

There are three reasons to hold ACOs accountable for specific quality measures as well as total cost:

• Ensuring health and health care are improving alongside cost savings
• Knowing how the cost savings are achieved
• Protecting against “stinting” or the forgoing of necessary care

To be successful, the shared savings program must improve the quality of delivered care while lowering costs. Savings generated by “stinting” will invite the type of backlash seen against HMOs in the late ‘90s. That is why at Aledade our first principle is “Place the patient’s interests above all”. Accomplishing “more with less” will require ACOs to achieve mastery of massive amount of data, the ability to navigate and the ability to change rapidly. At Aledade, we believe that health information technology not only enables the collection and use of data, but rapid cycle test and learn processes. It is not enough to generate savings, but we need to know how we generated savings and replicate it across our ACO primary care providers.

But the measurement of quality must be valid, meaningful, and not impose undue burdens of data collection and reporting. We encourage CMS to look beyond just traditional clinical quality measures and at newer measures and electronic submission established through the meaningful use and other program measures for the ACO program as well.

There are three examples where specific quality measurement proposed by CMS fall short.
First, the leap from requiring medication reconciliation at hospital discharge to requiring it at every office visit is too far. The meaningful use measure provides a much more suitable transition going from hospital discharge to every transition of care and is an established measure.
Second, we are deeply concerned with the removal of all measures related to LDL management. Instead of removal, we suggest that a rapid cycle development process be undertaken to include the revised measures in the final rule, or to use measures already under development (e.g., NQF 0455- statin adherence among individuals with diabetes). Absent that, we recommend that the measures be kept, but de-linked from performance due to change in guidelines.
Thirdly, we urged CMS to create and adopt more measures to protect against stinting. While existing measures around preventive services and ambulatory care sensitive admissions offer some indication of care adequacy, this is an area where broader public discussion and creativity is needed. Can patient-reported experience (eg ease of getting needed referrals) be relied upon? Are there indicators of stinting (“trigger measures”) that can be derived- much as readmission measures protect against early discharge (e.g., ambulance dispatch within 7 days of an office visit?)

Chronic Care Management Arrives at the Big Show

We are excited about the inclusion of the chronic care management code and its availability to Medicare beneficiaries regardless of what aspect of Medicare they and/or their providers participate in. We want CMS to ensure that this code can be integrated with ongoing chronic care management efforts by allowing the use of previously established individualized care plans. Aledade will use data to identify those beneficiaries who would benefit the most from CCM and continuously improve our processes to deliver the best chronic care management possible. We are currently working on a CCM guide, and we look forward to sharing it soon.

Speed Necessitates Transparency – CMS Can Do More

CMS must be able to adapt programs quickly and be transparent not just with their data, but also their methods. Providers must be able to adapt their own systems with a speed unheard of just a few years ago and still very rare today. Complete transparency by CMS makes this rapid adaption possible.
In our comments to CMS, we first suggest that the government should make public the actual contractor specifications and code for establishing attribution of beneficiaries, quality composite, benchmarks for savings and performance year costs in MSSP. While CMS provides narrative PDFs, this is simply not how requirements for measurement are communicated today. If CMS wants ACOs to move towards more integrated use of health information technology – as we are doing at Aledade right now — then CMS must communicate their methods in the language used by technology developers. At minimum, CMS should develop CQM specification style resources for all measurements in the MSSP.
Given the rise of data availability, coming changes in the health care system will be evidence-based, voluminous, and rapid. This trend will make rapid adaptation of clinical quality measure reporting and workflows the price of entry to succeed as an ACO. CMS must break through traditional norms when it comes to transparency and communication with the public to do their part.

We encourage you to check out our complete comments.

On June 18, we launched Aledade – a company built on our belief that independent primary care physicians are best positioned to lead the next revolution in health care delivery – boosting quality of care and bringing down costs.  Over the past six weeks, we traveled across the country meeting doctors, discussing the future of independent primary care practice, and recruiting physician partners for our first wave of Accountable Care Organizations.

Meeting these doctors, from areas and backgrounds as diverse as the populations they serve has been a constant reminder of the reasons we founded this company.  One physician, having spent decades serving the same community from the same office, lamented that in the past, he felt more involved – and more informed – about all aspects of his patients’ care.  Today, he told us, fragmentation in care delivery had given him less insight into his patients’ health, and less influence in coordinating their treatment.

When we started Aledade, these were the type of doctors we wanted to empower.

Today, I am elated to announce that we have formally submitted applications to the Center for Medicare & Medicaid Services to form ACOs serving physicians in Delaware, Maryland, New York, and Arkansas for 2015.  We expect this first wave of Aledade ACOs to serve tens of thousands of Medicare patients beginning January 2015.

The choice of four dissimilar states was intentional. We intend to establish a model that can be replicated across the country, and the diversity in our practices matches the diversity of our country. Each state has strengths to build on. Delaware- ‘the First State’ has been a leader in electronic health record implementation. Maryland and New York’s health reforms set the stage for alignment and collaboration with acute-care facilities. Arkansas’ tradition of independent primary care practice is strong. We’ll also be serving very different patient populations in each state – from practices that serve urban neighborhoods to those that treat folks in small towns and rural communities.

In all four states, we will spend the next five months working closely with our physician partners to tailor custom administrative and technological solutions for their practice needs and help accelerate practice transformation.  Our previous work in policy and outreach has already given us some ideas about how physician-led ACOs can best leverage the value-over-volume care delivery model, and there’s been a great deal of writing on the advantages of physician-led ACOs. But we also know that successful ACOs are built specifically for the communities they serve.  That’s why we will develop tools for our doctors with the unique needs of their practices – and his or her patients – in mind.

As we do, we will focus on three key areas:

Greater Availability to Patients.   Doctor availability and attention to patient needs are not just the key to patient satisfaction; they also are important to avoiding hospital admissions and more serious medical issues down the road.  So we’ll also be encouraging our physicians to place a greater emphasis on wellness visits and preventative medicine – and helping them to do that in as an efficient and effective way as possible.

Tools to Succeed.  I’ve said many times: in today’s health care marketplace, technology is necessary – but not sufficient – for success.  Data doesn’t solve health care problems by itself, but the right information and the right technology can empower doctors to manage patient care, notice trends, and address medical issues before they become serious.  Our team has over two decades with cloud-based medical platforms and electronic health records (EHR) – we know the functionality needed.  Our CTO Edwin Miller will team up with each individual ACO to customize the technological solutions that fit best, and work with doctors and their staff to continually optimize how those tools are used and effectively integrate the EHRs into the practice’s workflow.  We are committed to the success of our doctors, and technology will be a huge part of that commitment.

Passion to Lead Change.  When recruiting partners, we sought out independent physicians eager to participate in – and lead – the trends transforming our health care system.  Doctors in each of our ACOs will work together to explore opportunities for improvement, and share ideas for improving practice operations, technology, and patient management.  We want our doctors to communicate and exchange best practices – we expect to learn a great deal from their daily experience, and we expect them to be active partners in the process of continual improvement.

We founded Aledade on the belief that physician-led ACOs can be the leading edge of health care transformation in the United States.  Our doctor partners share that belief and are equally eager to prove that hypothesis right.

This first wave of sign-ups is over, but we’ll continue to sign up new practices in other states across the country. That means we now have to build as we grow – and we couldn’t be more excited to start.

Veteran policy wonks were compulsively refreshing their browsers set to the Federal Register website last Thursday at 4:15 PM, hoping for some light reading before the July 4th long weekend.  Specifically, they were waiting for the new proposed rule from CMS on revisions and updates to the Medicare Shared Savings Program.  It’s an issue that many in the health care transformation field have been following closely (I co-authored a Brookings Policy Brief last month offering suggestions on where we thought the policy should go).

While we didn’t get the long-awaited “ACO 2.0” rule, we did get some nuggets of ACO-related policy news in the annual Physician Fee Schedule proposed rule that was released instead. For those of you who already have your beach reading set for this summer, I’ve pulled out three key takeaways from the 609-page document:

1)   Evolution, Not Revolution, Concerning Quality Measures

For better or worse, there is a lot of continuity between the quality measurement framework proposed here and the MSSP rule promulgated three years ago. Some measures have been retired because the evidence no longer supported them (e.g. lipid control to a specific LDL level), and others were duplicative of existing measures. In total, eight measures were dropped, but 12 new measures were added, notably including all-cause unplanned admissions for certain populations, and skilled nursing facility readmissions.  These new measures will be “report only” for their first year in 2015.  The proposed rule would also award bonus points for quality improvement (not just performance) in each of the existing four ACO quality measure domains

2)   Missing an Opportunity on Quality Reporting

Unfortunately, CMS did not propose any new requirements regarding EHR- or registry-based reporting for MSSP – an extremely disappointing outcome, given the major problems that exist with the current Group Practice Reporting Option GPRO web interface.  CMS “estimate[s] that, on average, it will take each group practice 79 hours to submit quality measures data via the GPRO web interface,” but anyone who has dealt with the system knows that the time commitment vastly exceeds that number, and a more streamlined, efficient platform is necessary.  The solution is not to scale back the number of patients per measure (from 411 to 268)- but rather to move away from sampling- and chart review- based quality measurement altogether.

3)   “Volume to Value” Evidence Mounts

The proposed rule did have some very encouraging news in the proposals for the Value-based Modifier (VBM) and Chronic Care Management (CCM) regulations.  As expected, the VBM increased from 2 to 4 percent, and will be phased in to all practitioner groups by 2017.  The CCM regulation allows $41.92 to be billed to Medicare once a month, for each qualified patient with two or more chronic conditions.  It requires the practice to provide 24/7 patient access, secure messaging, a designated provider, medication management, a comprehensive plan of care, care transitions and community supports, as well as a 2014 certified EHR accessible to all providers within the practice—all components of a comprehensive ACO strategy.

Overall, the proposed PFS rules offer some encouraging signs about where Medicare is headed – away from the old fee-for-service model and towards rewarding ACOs that deliver the best outcomes.  Here at Aledade, we are working to help make that transformation happen, and will be watching and responding to CMS as it continues to lay out the new rules of the road.

Today, I’m launching a new company, called Aledade.

Aledade partners with independent primary care physicians to make it easy and inexpensive for them to form and join Accountable Care Organizations (ACO) in which doctors are paid to deliver the best care, not the most care.

This is good for patients who will find that their trusted primary care doctors are more available and better informed than ever before. It’s good for doctors who want to practice the best medicine possible, the way they always wanted to. It’s good for businesses and health plans looking for healthcare partners that deliver the highest possible value and outcomes. And it’s good for the country as higher quality, lower cost care will help lessen the strain on our budget and our economy.

The world of start-ups may not be the usual path for those leaving a senior federal post, but it’s the right decision.

For me, Health IT was never the “ends,” but a “means” to better health and better care, and I continue to believe that better data and technology is the key to a successful transformation of health care. And it is why the attempts to do so now can succeed, where they have failed before.

Empowering doctors on the frontlines of medicine with cutting edge technology that helps them understand and improve the health of all their patients- that is the mission of our new company, and one that has animated my entire career.

During the seven years I spent working for Tom Frieden and Mike Bloomberg in NYC, it was exhilarating to be able to push the frontier in what was possible — to innovate at the edge.

Working with my team, we were able to: invent new statistical methods for outbreak detection , develop new data visualization methods, create visibility into population health down to the neighborhood level, bring decision support and rapid diagnostics to the point of care, automate electronic quality measurement, and implement novel financial incentives and hands-on technical assistance to support care transformation in small independent primary care practices. It was exhilarating.

When I moved to HHS in 2009, the transition to federal service also meant a change in perspective.

As the National Coordinator for Health IT, my key responsibility was now to ensure a minimum national “floor.” We had to push the country as a whole towards a common core set of data and capabilities. We applied creativity and grit to do what needed to be done, using the best tools available to us: encouraging the private sector; organizing and scaling state and local efforts like the inspiring work of the regional extension centers; and — yes — through the blunt instrument of regulations too.

I’m extremely proud of the work we did, and the foundation we put in place. The country is in a massively different place, and the age of data has finally come to healthcare. But in that role, I was also acutely aware of the compromises and incremental half-steps that have to be taken when the goal is to move an entire nation. I was inspired by those that pursued improvement not “compliance” and did not mistake the floor for a ceiling.

I’ve had the good fortune for the past nine months to be ensconced among some truly great thinkers at the Brookings Institution, and to go on a “walkabout” – talking to and visiting with leading practitioners throughout healthcare. I have come away with a rare stereoscopic view of the changes sweeping through health care — the anxiety of those with “one foot on their old business model’s grave and the other foot on their new business model’s banana peel”, mingled with the excitement of those who would disrupt the status quo.

And during this process, I have also found my cause.

It’s to help independent primary care doctors re-design their practices, and re-imagine their future. It’s to put primary care back in control of health care, with 21st century data analytics and technology tools. It’s to support them with people who will stand beside them, with no interests other than theirs in mind. It’s to promote new partnerships built on mutual respect, and business arrangements that will truly reward them for the value that they uniquely can bring- in better care coordination, management of chronic diseases, and preventing disease and suffering. It’s to achieve lower cost through better care and better health.

I believe in this. And this is the mission of our new company. And to realize it, we will be back at the vanguard, helping to lead this transformation in health care that has been underway for years but is quickening and coming faster than ever before.