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St. Luke's and the Medicare Shared Savings Program

By Dr. David C. Pate, News and Community
February 27, 2012

During St. Luke's employee forums held during the summer, I shared our interest in the federal Accountable Care Organization program.

As the result of our exploration and analysis, St. Luke’s will apply this fall to become a federally recognized Accountable Care Organization (ACO) through participation in the Medicare Shared Savings Program (MSSP). Across teams, departments, and sites, work is being done now to prepare for the application and for the clinical and business integration that underpins functions as an Accountable Care Organization.  

The federal government is looking to willing health care systems like St. Luke’s to deliver best practices in care coordination, managing transitions of care, implementing evidence-based medicine, and making our care patient-, family-, and caregiver-centered. If we can lower the total cost of care on average for our population of Medicare beneficiaries, we will be able to share in the cost savings. 

 I’d like to answer some of the questions that come up most frequently about the ACO designation and the process we are embarking on.

What is the difference between accountable care and an Accountable Care Organization?

Providing accountable care is what we need to do every day with all patients. It describes how we bring added value to our patients and their families. We do so by making good on our mission of improving the health of people in our region. That’s the better health part of our Triple Aim: better health, better care, at lower cost. And we do so through the physician/patient partnerships and new models of care that result in better care and the continuous process improvements and ongoing quality push that are beginning to show results in lower costs.

An Accountable Care Organization includes all of the participants actively engaged in the care delivery system that is accountable for the care of a population. This will include the St. Luke’s Health System, physicians in our St. Luke’s Clinics, independent physicians who wish to clinically integrate with all the other physician participants, home health, hospice, and very possibly non-St. Luke’s care providers.

Why is St. Luke’s applying for the ACO designation?

We believe that participating in the MSSP is a key tactic to help position us for the future of health care in the United States. 

We have been moving increasingly toward accountable care as our standard of practice, and have taken our Triple Aim of better health, better care, at lower cost, as our shared definition and understanding of accountable care. Medicare represents a large percentage of the patients we care for and provides significant opportunity to better coordinate care, so it definitely makes sense to participate in this program. Further, the MSSP moves us toward the business model innovation that will be necessary to help drive changes to care delivery.

Medicare is just one, though a significant, segment of the population of patients for whom we must provide accountable care. In addition, through our efforts with our St. Luke's Healthy U employee wellness program, we are preparing to deliver accountable care to our own employees. We have begun discussions with commercial payers to develop new programs designed around accountable care, and have already entered into one such contract with Regence (Blue Shield) of Idaho. Further, we are having discussions with the state about the need to develop accountable care programs for the Medicaid population, which will grow by an additional 50 percent in 2014 when that portion of the Patient Protection and Affordable Care Act kicks in.

We believe that accountable care ultimately will help us to solve some of the intractable cost and quality challenges that have paralyzed domestic health care delivery and often forced patients and their families to make painful choices with long-term and costly consequences.

What does the Accountable Care Organization designation mean in terms of St. Luke’s other significant initiatives?

We have taken a critical look at the federal ACO program and how it meshes with our clinical integration efforts, our development and expansion plans, projected population and public health trends for our region, and our organizational goals and strategies.

Because we have been aligning our organization around an accountable care model over a period of time, and due to our very secure financial position and the solid support we have from our community, we believe pursuing ACO status will allow us to leverage our other initiatives more effectively as we move steadily in the direction of our vision.

Clinical integration is fundamental to our accountable care strategy, and allows for participation by independent providers. Implementation of our myStLuke’s electronic medical record system will support the development and capabilities of our clinical integration strategies. 

We have been conservative in forecasting future bed needs to make sure that we account for more efficient use of home and outpatient services and do not build excess bed capacity. At the same time, we are considering projections related to population growth and aging, and increased demands that exist in some of our communities today. 

How does the MSSP fit into this?

The federal Patient Protection and Affordable Care Act created the MSSP and the vehicle by which designated ACOs could contract with Medicare and participate in the program. The MSSP is a first step of what is likely to be a longer-term, far-reaching journey toward the reorganization of health care delivery.

Much has been made of all the changes necessary for participation in the MSSP. St. Luke’s is viewing MSSP and Accountable Care Organization participation as an extension of the Triple Aim progress we have made to date, and as a vehicle by which we continue to progress toward better health and better care at lower cost, our Triple Aim. The MSSP is one of the ways in which we believe we can extend value to our patients and their families.

What will change as a result of St. Luke’s participation?

Changes are meant to improve the health care experience for patients and improve the value that they receive from health care.

To that end, we will see many changes evolve over time. There will be new initiatives directed at helping people improve their health and adopt healthier lifestyles and behaviors. We will be working to increase patient access to care, including the use of non-physician providers, in lower-cost settings. 

We will continue our myStLuke’s implementation to allow patients to access our patient portal. We will make greater use of home health, and put systems and processes in place to try to manage transitions of care more effectively. We are already developing more sophisticated data-mining capabilities, and we will create disease registries to permit us to better identify patients with certain chronic diseases for targeted interventions. We will be putting in processes to better educate and engage patients, as well as to better manage those who are high-risk or already have complicated medical problems.

What’s next?

Work will continue through the year to gather input from our physician partners and proceed to develop policies and contracts for those who wish to participate; set up appropriate governance, quality, payment, and reporting structures; make sure we’re in compliance with all statutory and regulatory provisions of the program; define our network; and ensure that the transition to the new structure is as seamless as possible for our patients and their families. We will apply for the ACO designation this fall, and, if accepted, would start functions as an Accountable Care Organization in January.

What's your part to play?

I'm counting on you to ask questions, suggest ideas, and partner with St. Luke's as we work to transform health care in our region. I invite your thoughts, comments, and questions, through this blog, our other social media platforms, our upcoming employee forums, and other meetings that will take place.

I don't have all the answers, but with your help, I know that we can come up with powerful solutions to the challenges we face. You have my thanks, and my commitment.

About The Author

David C. Pate, M.D., J.D., is president and CEO of St. Luke's Health System, based in Boise, Idaho. Dr. Pate joined the System in 2009. He received his medical degree from Baylor College of Medicine in Houston and his law degree from the University of Houston Law Center.