While many things remain undefined when it comes to the industry’s move to pay for performance, one thing is certain – one size does not fit all. Encouraged by the regulations around Medicare’s CMS-based ACO, providers, physicians and payers are teaming up in a variety of ways to create new models of collaborative care. Although the CMS-defined ACO model has the lowest downside and many health systems will need to adopt it due to competitive pressures, the following models allow for the ability to scale to various-sized populations and design customized shared savings arrangements tailored to the needs and demographics of each community:

  1. The Provider Employee Model — With this model, health systems “pilot” a collaborative care structure by taking on the risk of their own employees. The overall risk level is expected to be relatively low, due to a controlled population and direct access to the covered population for communications, education and screening. Several of the larger hospitals and health systems — some with up to 30,000 self-insured employees — are currently in the early stages of this model. After the testing/trialing phase where they’ll manage the population, monitor physician performance, and watch patients closely on a longitudinal basis, these health systems will likely move on to other “flavors”  of collaborative care models.
  2. Payer/Provider Realignment — This model is usually found in areas where the performance of the health system is below the national benchmarks, prompting the payers and providers to work together in a more collaborative fashion than in the past in an effort to improve outcomes.  This could be a single payer and multiple providers, or realignment within a limited population, and may offer no limited gain share.
  3. Expansion of Existing Risk — Many health systems across the country already share and bear risk. Some have their own health plans, while others have certain physician groups in risk-capped contracts. As they see the potential rewards, they can position themselves to take on more risk. Some organizations have been doing this for a while and, although there aren’t many in this country, there are enough to make it a model to consider.
  4. Clinical Integration — This model deploys tools and processes that pass FTC “acid test” for clinical integration between hospital provider and physician groups. Physician groups collaborating with hospital systems are subject to strict anti-trust laws and must prove they are clinically integrated with the health system. This is a pre-requisite step for any physician group and hospital system that want to embark on a comprehensive collaborative/accountable care organization. Some health systems seek to achieve this step now and then wait for both the final CMS regulations on ACOs and commercial market developments.
  5. Comprehensive — The full risk model or the “holy grail” of healthcare, the comprehensive model involves collaborative participation of multiple providers and multiple payers, potentially including Medicare/CMS, but private payers as well. It engages the community of independent and hospital-employed physicians. We’ll likely see many more of these launch in 2013 and 2014.

No matter the model, all should share the ultimate goal of achieving a Sustainable Health Community — where information flows freely among all participants, data is turned into actionable information through the use of analytics and informatics, and the interests of all participants are considered equitably.

–Todd Cozzens