2. 2
1 Specialty care models......................................................... 4-5
2 Episode-based care models................................................ 6-7
3 Patient-centered medical homes and neighborhoods......... 8-9
4 Clinical integrated networks (CINs)................................ 10-11
5 Accountable care organizations (ACOs)......................... 12-13
6 Risk-bearing entities (RBEs)............................................. 14-15
The purpose of this e-book is to assist
health plan and provider CMOs as they
consider new care models. These are
required to support new contracts and
arrangements. This information can help
them determine which models offer the
greatest potential for their organization.
Table of contents
3. 3
Six models for health plan-provider
partnership on care delivery
Consolidation, government mandates and the rise of aging populations are churning the health care
industry. Leaders face increasing pressure to cut medical expenses, improve quality and create better
relationships with consumers. Health care is shifting to become more proactive, consumer-centric and
well-coordinated. And every day, new services are emerging outside of the acute care environment.
The system is demanding that costs come down and quality improves. Consumers and physicians are
clamoring to improve on a complex administrative process and disjointed care experience.
Value-driven care holds great promise for fulfilling these goals. That’s why a growing share of health-
industry stakeholders are moving to explore its benefits. Accountable Care Organizations (ACOs) now
cover more than 32 million patients across the country — roughly 10% of the U.S. population.1
Each day
health organizations are exploring new payment structures and the care models required to fulfill them.
Success depends on aligning care models to new payment contracts, ensuring that they are sustainable
and that everyone benefits.
The fee-for-service model is still intact, but there is an increasing shift toward other models. As health
plans and providers test these partner-based alternatives, six potentially favorable models have emerged.
4. 4
Specialty care models1
How they improve quality of care
Specialty care models manage chronic and complex illnesses by connecting primary
and specialized care. Providers who specialize in complex ailments often operate high-
performing care systems that are efficient with medical expenses. These providers can
embrace these models. Primary care groups may wish to partner with these specialists
to help them meet their own value-based goals.
Aligning care and contracts
The rationale for these models is to increase the market share of a specific, medically
focused population. But physicians will need to see how this approach aligns to the
mission and priorities of the organization.
These care models cut medical expenses by reaching complex patients earlier and
more often. They share savings achieved by lower utilization medical expenses.
It’s vital that cost efficiencies and quality gains translate across health plan contracts.
Contract metrics and terms need to be consistent. Contract inconsistencies lead to
care inconsistencies and lower success rates.
Physicians should expect rewards for their improvements. Partners, leaders and
individual physicians need to agree on how to measure, achieve and share savings.
Primary care net promoter scores
Scores improve when physicians lead model
design. They must be able to receive the required
system support and track the connection to
improved outcomes.
Reduced utilization
Each organization determines their specific metrics
for reducing utilization. But it’s important for the
priorities of individual physicians to be consistent
with organizational goals.
Compliance rates
Organizations that embrace order sets based on
evidence-based guidelines can increase adherence
to key quality measures. Using order sets impacts
the documentation needed to prove performance
and secure payments on the back-end.
MODEL MEASURES
The patient population focus includes cancer, diabetes,
dialysis, asthma, heart disease, opioid addition, Alzheimer’s
disease and depression.
How they benefit:
• Early identification and treatment
of chronic conditions
• A comprehensive approach to complex
patient health
• Strong patient/primary care relationship
• Better quality of life
Population focus
5. Foundational
benefits
5 questions CMOs should ask
Q1 Do we have a significant number of an
attributed or enrolled population where
we can justify the investments required
to manage utilization?
Q2 What other services, medications, medical
devices or resources do we need to succeed
with this population and these models?
Q3 What care management outreach is required
to increase consumer engagement and
impact utilization?
Q4 How will this improve patient outcomes?
Q5 Are the necessary infrastructure, data and
care coordination tools in place?
THERE ARE CURRENTLY OVER 60 MILLION MEDICARE BENEFICIARIES IN THE UNITED STATES.2
That number is expected to reach 79 million by 2030.3
According to CMS, more than two-thirds of this
population have at least two chronic conditions.4
This represents a growing demand for early intervention
of chronic disease and coordinated care of multiple conditions.
Engaged and empowered physicians can lead a culture of continual improvement. This creates new value
for the health consumer and builds organizational mastery of risk and growth dynamics
Physician leadership: Primary physicians and leaders need to share their
firsthand knowledge of day-to-day workflows. These leaders have the trust of
physicians, and can engage them in model design and improvement.
Partnerships: A specialized care partner may be able to help with infrastructure
upgrades. They can also help with the design and deployment of new care
intervention models, and additional staffing support.
Infrastructure: Data collection, actuarial expertise and information sharing
across the network are foundational needs. Supporting appropriate, secure data
integration may require investment.
Early disease identification: This is a crucial capability. These models succeed
when they eliminate unnecessary treatment. They also must connect the patient to
effective care earlier and at each phase of the disease.
Care coordination: These models span the lifecycle of the disease. This creates
greater opportunities for quality and for cost savings when patients are identified
early. It also creates a demand for care coordination across a broader set of services.
SPECIALTY CARE MODELS
5
Building blocks
6. Episode-based care models2
How they improve quality of care
These models provide one payment for an entire episode of care, making them ideal for
a single condition or surgical procedure. These include hip or knee replacement surgeries,
cardiac surgery or stroke treatment. Studies have shown a significant positive effect on
patient care for joint replacement procedures.5
These models can also result in a 20.8%
decrease in total spending per episode.6
Aligning care and contracts
Bundles must include services that surround the procedures. This requires an advance
care plan and coordination with acute, post-acute and ambulatory partners. It may also
include coordination with medical device providers and pharmacies.
The provider partner assumes responsibility for optimizing utilization levels to manage
below the budget. Success relies on collecting and sharing accurate data.
Individual bundles are typically defined in 30-60-90 day increments. However, shorter
durations may be warranted, e.g., maternity. It’s important to clarify what procedures and
protocols to include. It’s also important to understand the duration of the provider risk for
each episode.
Pricing is based on actuarial models that contemplate variations in medical expenses
across the range of settings. Both parties must agree on which patients are the best
candidates and how to calculate quality measures. They also must agree on what services
to include and how to share savings.
Advance care planning
It’s important to engage the patient in a
meaningful pre-event planning process. That
aligns the care plan with their desires, and
earns rewards from CMS.
Improved patient safety
Coordination of drug safety, physical therapy
and other perioperative care speeds the path
to healing. It also reduces readmission and
emergency care.
CMS Measures
CMS has selected seven quality measures for
the Bundled Payments for Care Improvement
(BPCI) Advanced model.
MODEL MEASURES
Episode-based care models typically include congestive heart
failure, joint replacements, gastrointestinal surgery, maternity,
stroke, sepsis, cardiac arrhythmia and urinary tract infections.
How they benefit:
• Maintain a voice in their care planning
• Receive well-coordinated care throughout
the event or episode
• At reduced risk for readmission or
emergency room visits
• Less risk of financial harm
6
Population focus
7. Foundational
benefits
5 questions CMOs should ask
Q1 Are we already measuring and monitoring
any of the BPCI Advanced quality metrics?
If not, what is required to put that in place?
Q2 How well do we currently deliver on
evidence-based guidelines and CMS quality
measures for this procedure? How easy
would it be for us to improve?
Q3 How do we manage our medical
devices supply chain, pharmacy and
network referrals?
Q4 How well do we manage patients before
they come into surgery?
Q5 Do we have dashboards in place to
support physician decision-making within
the workflow? And are we equipped to
coordinate care for this event through
post-op and post-acute care?
PROMOTE COLLABORATION: Because these models cater to a single episode of care, they
encourage streamlined workflows and communication.
TRANSITION TO VALUE-BASED CARE: These models represent an efficient method for health
plans and providers to treat high-risk, high-cost patients. They help to facilitate longer treatment
periods to address all the conditions of the population.
Partnerships: Participation can include arrangements with multiple hospitals and
physician groups. It’s important to analyze the role your organization will assume,
and the clinical episodes involved, before advancing.
Provider network: To deliver consistent, evidence-based care in bundled models
depends on a network of quality performers. Each participating organization needs
to understand their role. They must ensure that they’re following evidence-based
guidelines, and be able to measure and report outcomes.
Quality reporting: Quality measures vary by episode, contract and program.
They also vary by care strategies — pathways, protocols and care teams. CMS is still
evolving its requirements as it evaluates a growing body of data.
Care coordination: Outcomes improve when care is coordinated throughout the
recovery period. Care managers, therapists and community workers ensure that the
transition is smooth and free of adverse events.
EPISODE-BASED CARE MODELS
Building blocks
7
8. Patient-centered medical homes
and neighborhoods
3
How they improve quality of care
The goal of patient-centered medical homes (PCMHs) is to holistically meet the majority
of each patient’s care needs. The primary care physician guides a well-coordinated team
to surround the patient with wellness programs, preventive care, acute care and chronic
disease management.
Patient-centered medical neighborhoods are designed around conditions — such as heart
failure or behavioral health. This approach coordinates the most appropriate resources
and mix of services that best address the conditions with specific interventions. Evidence
suggests that PCMHs can reduce unnecessary use of health care services.7
Additional studies link PCMH models to better outcomes for patients and a more satisfied
clinical workforce. Patients who suffer from chronic conditions adhere to their medication
regimens at a higher rate while receiving care in PCMHs.8
Physicians also experience
higher morale and job satisfaction.9
Patient-centered performance windows
These models call for patient engagement in
more proactive, cost-effective delivery channels.
The population covered and timelines associated
with their treatment and recovery determine the
performance windows.
Primary care performance measures
Measures should be selected from each of the
following areas: preventive care, chronic disease
management, acute care, overuse, and safety.
Accreditation
CMS acknowledges both National
Committee for Quality Assurance (NCQA)
PCMH and Patient-Centered Specialty Practice
Recognition programs as ways to receive credit
in Medicare Access and MACRA.
MODEL MEASURES
Population focus
PCMHs provide primary care and serve patients regardless of
care population or type of episode. But payment contracts or
patient-centered neighborhoods may define specific disease
types. They do this with a desired reduction in the medical
expense of key care episodes.
How they benefit:
• More engagement in a strong patient-primary
care relationship
• A coordinated approach to their full set of needs
• Reduced risk for readmission or emergency
room visits
• Easy, more convenient access to care
8
9. 9
Foundational
benefits
5 questions CMOs should ask
Q1 Who are the consumers we are most
likely to serve?
Q2 What is the expanded network of services or
channels needed to effectively support them?
Q3 What resources and timeframes do you
need to achieve NCQA recognition?
What financial incentives or levels
of coaching are appropriate?
Q4 Does our infrastructure support this level of
care coordination? If not, how can we work
with our partners to build it?
Q5 What type of outreach, patient engagement,
and care coordination tools and training do
you need to build an effective model?
TEAM PERFORMANCE: With the infrastructure in place, teams can collect, combine and safely share
medical records. This allows them to coordinate care and self-regulate performance.
CULTURE OF IMPROVEMENT: Primary physicians agree to be benchmarked and reveal how they perform
relative to their peers. Natural competition leads to a culture of continual improvement. This means a
reduction in unnecessary or low-value care options, and more in-network referrals.
TRANSITION TO VALUE: Systems that establish PCMHs automatically qualify as alternative payment
models under MACRA without needing to engage two-sided-risk arrangements. These arrangements can
naturally evolve into accountable care frameworks.
Primary care physicians: Primary care is at the center of care coordination.
They may need up to a year to meet PCMH requirements and achieve NCQA
recognition.
Infrastructure: To coordinate care, PCMHs require an integrated EMR. This
ensures that care teams have a real-time, complete shared view of patient health
information. They also have a view into the activity happening in each care channel.
Investment: These models call for patient engagement in more proactive,
cost-effective delivery channels. This may require capital or partner investments to
acquire a telehealth system, or new locations for urgent care clinics.
PATIENT-CENTERED MEDICAL HOMES AND NEIGHBORHOODS
Building blocks
9
10. 10
Clinical integrated networks4
How they improve quality of care
Clinically integrated networks (CINs) join providers together in an FTC-approved manner.
This allows them to create and quantify new levels of performance in their market while
retaining independent and disparate organizations.
Equipped with common benchmarks and real-time information sharing, physicians can
reduce care variation and eliminate medical expense from the system. Everyone needs
high-performing providers in their networks. And CINs prove adherence to standards
and protocols that demonstrate higher value.
Aligning care and contracts
The legal structures can take a variety of forms, but to qualify, all CINs must place
physicians in key leadership roles. They must agree to measurable goals and employ
proven protocols using data and analytics.
Physicians may want to participate in CINs to help them succeed under MACRA.
CINs can also support the value-based goals of patient-centered medical homes,
hospitals, health systems and accountable care organizations. CINs necessitate a
sufficient legal framework. They also require governance, infrastructure and processes
to achieve agreed-upon goals. They are inclusive of physicians, payers, health systems
and employers.
Improved care quality
CINs use clinical and claims data to track
performance against evidence-based guidelines.
This can also identify areas of opportunity
for improvement.
Reduce medical expenses
As leaders of the care model design,
physicians are accountable for gaining alignment
across the network. This requires infrastructure to
track care variation reduction and unnecessary or
low-value care.
Compliance
Physicians can determine quality improvements
to hold the network accountable. Compliance
rates are a clear metric to prove adoption of
evidence-based protocols. It can prove network
alignment when measured at the physician level.
MODEL MEASURES
Population focus
This arrangement supports population health as CINs focus
across specialty care areas. This could include the Medicare
population as well as cancer, diabetes, dialysis, asthma, heart
disease, opioid addiction, Alzheimer’s disease and behavioral
health populations.
How they benefit:
• Receive well-coordinated care across the life-cycle
of their condition
• Streamline follow-up care with enhanced communication
between specialists and their primary care physicians
• Confidence working with clinicians who have
demonstrated top performance
• Safe from exposure to low-value care options
10
11. Foundational
benefits
5 questions CMOs should ask
Q1 Who is initiating development of the CIN —
assessing the market, the population and
other potential providers?
Q2 How will the physician leadership team
be formed?
Q3 Is there a governance structure in place?
Q4 Are the right infrastructure and processes
in place to measure and manage quality?
Q5 What is the strategy to gain physician
adoption, measure performance, and reward
improvements in quality and outcomes?
IN ORDER TO SCALE, HEALTH PLANS AND PROVIDERS REQUIRE A HIGH-PERFORMING, INTEGRATED PROVIDER
NETWORK. This network must be able to manage the full spectrum of health needs for specific populations.
Providers and health plans can come together to develop a unified experience, common branding, and an
aligned benefit design.
A successful CIN has a significant number of lives at risk. The actual number will vary by market. The initial
investment may be significant. But with the right volume and performance, the return on investment is likely
to occur in the third or fourth year. This will give both parties a competitive position for that population.
Board approval: The level of complexity for this structure typically requires board
approval. The board will set the strategy for the CIN and determine the approach.
The board will guide decisions about legal, consulting, analytic assessment or other
purchased services that are needed for this approach.
Infrastructure: Effectively coordinating care across multiple groups requires
shared data and analytics. It takes a care coordination platform, advanced clinical
documentation, claims management and claims processing technology.
Network referral and risk management: These models manage risk across
the lifecycle of a condition. The network has to be high-functioning and clear about
both the risk and the timeline for evaluating performance. CMOs need to acquire
the right level of care management resources. They also must have the integrated
EHR technology to support them.
CLINICAL INTEGRATED NETWORKS
Building blocks
11
12. Accountable care organizations5
How they improve quality of care
Accountable Care Organizations (ACOs) bring together clinicians, hospitals and other
health care organizations. Together, they provide coordinated, high-quality care to their
recipients. ACO contracts are designed to emphasize prevention and wellness. They
also provide incentives for improving population health and keeping patients out of the
hospital. According to a study from the Department of Health and Human Services, ACOs
outperformed fee-for-service providers on 81% of individual quality measures studied.10
Aligning care and contracts
ACOs use evidence-based care guidelines to meet and exceed standard benchmark
targets. While first established to serve the Medicare population, these models have since
extended into other populations and lines of business. ACOs succeed by aligning the
incentives of all stakeholders to optimize patient health. Partners combine resources and
analysis to define populations, determine member participation minimums, measure care
performance and design payment systems.
CMS requirements don’t apply to private sector ACOs. Their contracts can offer more
flexibility on quality requirements and financial incentives.
Improved outcomes
ACOs improve chronic disease management
through early identification of high-risk individuals,
preventive health measures and interventions
in the early stages of the disease. ACOs can
prove their physicians employ evidence-based
protocols and can reduce the need for emergency
department use or avoidable hospitalization.
They also demonstrate higher levels of patient
engagement in their own care.
Lower cost
Improving the care path includes eliminating low-
value or no-value care. It also includes reducing
emergency costs and delaying the need for high-
cost care associated with late stages of the disease.
Complex population health
Too often consumer health needs are
unrecognized or under-attended. ACOs use their
talent, infrastructure and partnerships to reveal
and respond to the health needs of a population.
MODEL MEASURES
Population focus
Medicaid has the highest member volume per contract, but
the lowest number of covered lives overall. The Medicare
Shared Savings Program has shown the most recent growth
opportunity, but the commercial sectors still lead overall
volume in both contracts and covered lives.
How they benefit:
• A holistic view of the social and behavioral
barriers to health care
• More efforts to close care gaps and
proactively manage health
• Transitions are smooth, safe and effective
from one care environment to the next
• Consumers get support to take more
control of their health12
13. Foundational
benefits
5 questions CMOs should ask
Q1 Which populations will be our focus?
Q2 Where are our biggest opportunities to
improve metrics for this population?
Q3 What evidence-based protocols and EHR
tools need to be prevalent across the system?
Q4 Who are the physicians that we want to lead
this effort and manage our pilots?
Q5 How will we track improved outcomes and
shared savings?
MERGING HEALTH PLAN AND PROVIDER CAPABILITIES WILL UNCOVER A RICH STORE OF CLINICAL,
FINANCIAL AND CUSTOMER DATA. By applying the data, health plans and providers can work together to
continually improve outcomes, reduce costs and increase patient satisfaction.
Proving performance attracts clinicians and patients. It also builds intelligence into your system. CMOs will
want to be ready to dialogue with potential clinical partners. Help them understand the risk equation,
how to share data and how to measure performance.
High-performing accountable care models will create a competitive advantage. This can be seen through
long-term reduction in medical expenses, efficient management of populations, loyal consumers and
market relevance.
Physician leadership and incentives: Physician-led ACOs have proven to
perform. In fact, they’ve been shown to produce seven times the amount of
Medicare savings per beneficiary than their hospital-led counterparts.11
But leaders
need time to establish the governance structure that fosters clinical accountability.
Physician engagement: Top-performing ACOs provide their physicians with
information and decision support in their workflow. This facilitates adherence to
evidence-based protocols and allows for more informed referral decisions and
pharmacy or medical device choices.
Population analysis: Before care models can be designed, organizations need
actuarial assessment of their patient populations. ACOs should aim to increase the
number of annual visits and educate consumers about their conditions. That’s how
they continually improve their outreach and care models.
Care spectrum: Since many ACOs target complex or chronically ill populations,
they need to integrate services across the life of the condition. This may include
adding care management, care transition programs and home visits. It also may
include expanding primary care access and addressing behavioral health needs.
ACCOUNTABLE CARE ORGANIZATIONS
Building blocks
1313
14. Risk-bearing entities6
How they improve quality of care
In these types of care models, the health plan and the provider system are one and the
same. Care improves because stakeholders share common objectives and align on an
approach. Typically, the provider takes on a leading role with high-quality care delivery
efforts. Risk-bearing entities (RBEs) focus on new engagement models. Increased
engagement between the patient and provider improves quality, optimizes utilization and
produces efficient care delivery.
The keys to long-term success include early due diligence in understanding populations
and tests of the care models. It’s also important to have complete and accurate measures
to project, guide and course-correct activities.
Aligning care and contracts
Risk-bearing entities are legal organizations whose stakeholders can include payers,
providers, and self-insured employers. The RBE can involve a variety of risk-based
payment methodologies, but the stakeholders share common objectives and financial
risks. Contract success depends on having the volume of lives to drive payer growth.
It’s also necessary to have a care model that is proven to perform.
Population size
The volume of the population involved must
remain available to sustain growth for all partners.
Medical expense benchmarks
Providers must be confident they can meet the
medical expense benchmarks.
Improved outcomes
Just like ACOs, RBEs are able to succeed with
preventive health measures and early interventions.
Lower cost
Care model improvements include eliminating
low-value care and pre-empting the need for
costly, late-stage services.
MODEL MEASURES
Population focus
Employees of self-insured employers, covered lives under an
insurance policy and specific attributed populations.
How they benefit:
• Care plans built from the most complete
set of patient insights
• An integrated suite of care services using
evidence-based guidelines
• Manage consumer health needs through
an event and across conditions
14
15. Foundational
benefits
5 questions CMOs should ask
Q1 How well have we defined our
attributed population(s)?
Q2 What are the timelines required for our
readiness and how do they match the
performance windows?
Q3 What is our strategy and what resources will
we have to surround these patients with
integrated, high-quality care?
Q4 How will we continue to analyze and assess
clinician performance against benchmarks?
Q5 How will clinicians be incentivized
to meet requirements?
MANY FACTORS ARE DRIVING THE NEED FOR RBES, INCLUDING AN AGING POPULATION THAT IS
INCREASING THE NUMBER OF MEDICARE PATIENTS. More than 40% of the U.S. population has at least
one chronic health condition, and that number is rising.12
Finding the formula for medical expense and quality success is the ticket to growth. It will attract
employers and allow confident participation in ever-evolving government contracts.
The key is building next-generation analytics that can harness information from the growing number of
data sources. RBEs can combine the latest clinical technology with deep actuarial insights. This creates an
ability to flex the individual care model as fresh insights become available. Ongoing improvements and
integrated care coordination can help to ensure the best clinical outcomes.
Equity ownership: An RBE can drive quick payer growth by bringing more lives
into their product portfolio. Providers who can manage the insurance risk and lease
back-office administrative capabilities from the payer keep any upside gains they
generate. But each arrangement is unique.
Governance: Each stakeholder takes a leading role in the governance of these
activities. Roles and responsibilities will need to be determined up front and may
involve joint governance.
Shared business intelligence and assets: Health plans and providers need
to be capable of integrating their capabilities. That ensures they deliver coordinated
services across the continuum of care. This includes bringing together large volumes
of data to create an actionable data set.
RISK-BEARING ENTITIES
Building blocks
15
16. 16
With so much diversity across provider and health plan organizations — and
within each market — there’s no one-size-fits-all approach to partnership. But
the experience so far makes it possible to form a picture of the benefits these
new models bring to consumers and clinicians. It’s up to individual health
organizations to decide if they’re worth further investigation.
To truly evaluate these options requires good analysis. Populations can be
dramatically different in each market, and medical expenses can be harder to
pin down for some populations. Health organizations are facing a tsunami of
decisions. They need the clarity of actuarial analysis and predictive modeling
to be confident their patients and physicians are going to receive real benefit
in return for the investment in these new alternatives. And only then can they
deliver on the promise of value-based care.
The shift to new care models begins with strong vision and leadership.
Finding the right organizational fit