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Grasping the network: A first step to ACO financial success

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  By Doug Fielding, VP, product strategy, ZirMed, August 1, 2013

In July, The Wall Street Journal revealed the first-year results from the Pioneer Accountable Care Organization (ACO) pilot program. While all of the health systems participating in this pilot program cited improvements in the quality of patient care, only 18 of the 32 participating ACOs were able to lower costs. This report gives a glimpse into the financial challenges that ACOs are facing to reduce operational costs. As ACOs are making strides in raising the quality of care, there are some key technical challenges to operate in this new mode of care while reducing costs.

At ZirMed, we have seen some of these challenges first-hand in processing financial and clinical transactions across our large network and bundling and unbundling those distributed payments. There are many approaches to confronting the financial challenges ACOs face, but the first step is for ACOs to get a grasp on the patients, providers and institutions within their own network.  

Many organizations that are setting up as ACOs face the challenge of trying to get capture all of the activity that is going on within their network and analyze it to figure out how to improve performance, like understanding when and why patients are seeking care outside the ACO. Since ACOs are treating patients across multiple venues, they must have a clear understanding of what providers and sites are part of the network and identify all patients within the network. For billing purposes, that means being able to identify all transactions for all of the patients that are included, and all of the providers, but also being able to include transactions from those parties that are not under the ACO umbrella. 

Once ACOs are able to track all care provided to patients across their own network, they can start to analyze that data to figure out how to optimize for quality and financial performance. To take the example alluded to above, one analysis ACOs (and most health systems in general) need to perform is to determine when and why patients are leaving the ACO to receive care. Keeping patient care inside the ACO is critical, but to do that they need to first know when patients are leaking out of the ACO and then try to understand why they are doing it. One big challenge here is that most organizations don’t have much visibility into what goes on outside their facilities. The other is that to the extent they can get that data from the payer or a clearinghouse or some other source, those sources are not set-up to answer the “why” question. 

We do this kind of referral pattern analysis for our clients by building in a way to capture the reason for seeking the out of network referral into the referral process and then doing the analysis. So we can evaluate every referral that a provider receives, how many accepted, how many declined and reasons why any referral was denied. With this information, we can help providers identify trends in denied referrals and make the necessary adjustments to improve their referral acceptance rate. ACOs need this type of information as well to find out the reasons why patients are leaving and learn how to keep patients in their own network.

As ACOs continue to get more sophisticated about how to track network activity, the clearinghouse community can add a lot of value to help ACOs achieve success. ACOs can look to external partners like us to gain better access to and understanding of relevant data flows outside their organization.


Tags: :: Guest Blog :: Accountable Care Organizations ::


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