by Joe Damore and Ashish V. Shah
Over the past 10 years, accountable care organizations (ACOs) have focused on implementing value-based care and new value-based payment models. The impact of this effort is well documented. According to CMS, the ACO model has increased Medicare savings for seven straight years, culminating in a $4.1 billion in savings in 2020. A key question is a portion of these savings the result of the model itself, or the product of selective enrollment or exclusion of patient populations most challenging to manage?
Prioritizing health equity
To combat the possibility of patient profiling in value-based care, CMS recently redesigned the ACO model to better reflect the agency’s vision of creating a health system that achieves equitable outcomes. The new model, known as the ACO Realizing Equity, Access, and Community Health (REACH) model, is a redesign of the Global and Professional Direct Contracting (GPDC) model and incorporates stakeholder feedback, participant experience, and Biden Administration priorities, including the commitment to advancing health equity in the ACO model.
Health equity, as defined by the Robert Wood Johnson Foundation, means that “everyone has a fair and just opportunity to be as healthy as possible.” Recently, the CDC National Center for Chronic Disease Prevention and Health Promotion (NCCDPHP) also stated that health equity is achieved when every person can “attain his or her full health potential” and no one is “disadvantaged from achieving this potential because of social position or other socially determined circumstance.”
From a measurement perspective, health equity requires the reduction, and elimination of disparities in health and its determinants that adversely affect excluded or marginalized groups. This includes obstacles such as poverty, discrimination, and their consequences.
CMS has developed six equity priorities for reducing disparities in health in all programs. Two stand out for ACOs:
1. Evaluating disparities and integrating solutions across CMS programs
2. Developing and disseminating promising approaches to reduce health disparities
Equity requires ACO changes, growth of home care
A major challenge in the U.S. has been that healthcare funding and incentives have not included resources to address the social causes of health inequities. This has perpetuated the problem. Conversely, several European countries have combined funding for health and social services and created incentives for communities and organizations to address both areas collectively.
ACOs have the unique opportunity to serve as a vehicle for addressing both the health and social needs of patients. While the REACH model gets us closer to this ideal, three additional changes are needed in the CMS ACO program for these organizations to be truly effective at driving health equity:
1. Eliminate the selectivity aspect of ACO models. This can be done through the prevention of the elimination of Tax Identification Numbers (TINs) to reduce risk within an ACO. The use of an ACO geographical and REACH models could help facilitate this change.
2. Include funding for social programs to incentivize ACOs to address social issues that will influence health status and equity in areas such as nutrition and housing. Many ACOs have demonstrated that addressing the social determinants of health (SDOH) can significantly impact the total cost of healthcare for specific populations.
3. Support the growth of telemedicine and home care services as key mechanisms to address SDOH. Many of these needs can be assessed, identified, and addressed in the home. By bringing care to certain patients instead of requiring them to receive care at a hospital or other healthcare facilities, several historical SDOH inequities can be addressed, including access and transportation barriers. Moreover, this effort can help better identify social needs and reduce avoidable patient stays and readmissions while reducing total costs.
As health equity continues to be prioritized at the federal level, more focus needs to be placed on modifying the ACO model, and additional investments need to be made in telehealth and home care programs. These changes in structure and process will be instrumental in overcoming location-based barriers to high-quality care as well as the lack of focus on the social determinants that has permeated many health systems over time.
Joe Damore, LFACHE, is CEO of Damore Health Advisors (DamoreHealth.com). A seasoned healthcare executive, Damore has extensive experience leading and assisting organizations in successfully transitioning to value-based care and payment models. He is a former vice president of strategy, innovation, and population health at Premier Performance Partners, and was CEO at both Mission Health System in Asheville, N.C., and Sparrow Health System in Lansing, Mich., for 20 years.
Ashish V. Shah is CEO of Dina (dinacare.com) and leads the Dina team on its mission to power the healthcare industry’s transition to virtual and in-home care. He founded the company in 2015 and remains passionate about empowering care teams with the tools they need to help people age in place. A recognized thought leader, Shah previously served as CTO at Medicity, the market leader for vendor-neutral Health Information Exchange solutions (acquired by Aetna for $500 million in January 2011).
