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HIT experts weigh in state law mandating ACOs in Massachusetts

Many states have their own ACO bills in process. Massachusetts ACO law doesn't mirror federal ACOs, but compliance could require more HIT investment.

Health IT leaders have yet another compliance mandate to put on the watch list: accountable care organization bills under consideration by state legislatures, designed to either bring about federal Affordable Care Act compliance or expand upon it in order to further cut Medicaid costs. In states such as Massachusetts, it's no longer something to watch, but to do. Gov. Deval Patrick signed a health care cost-containment bill -- with health IT implications -- into law.

By the American Association of Family Physicians' count, 24 states introduced 65 bills referring to accountable care in 2011. In fact, 22 accountable care organization (ACO) bills eventually became law across 16 states. Some of the bills, wide-ranging in scope, do little things, such as the bill in Tennessee, which redefined "health care organization" in its statutes to include ACOs.

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Other states are more ambitious, perhaps none more than Massachusetts' ACO law. It dangles the carrot of ACO formation to offset the stick of a stiff new capitation plan for Medicaid patients. But it's not quite an unfunded mandate, as the law supplements federal electronic health record grants for small hospitals, as well as funding the statewide health information exchange (HIE) that ACO-based patient care requires.

State HIT Coordinator Manu Tandon said Massachusetts legislators intended to make health IT mandates of the law -- as far as health care providers are concerned -- harmonized with meaningful use. "The intention was to leverage federal laws to the maximum and not create additional burdens, if possible."

The law could send Massachusetts payers scrambling to find new business relevance in an ACO-heavy health care system, said George Moran, a professor in the graduate health informatics program at Northeastern University. Right now, payers process fee-for-service claims and add value to health care with wellness programs; in the future, ACOs will more actively manage patient wellness and not receive payments based on each incremental service.

But remaking the state's health care will take a lot of HIT support. "It's going to be a huge change for CIOs, regardless of whether they're working in a physician-based organization or a physician-hospital organization [PHO]," said Moran, who previously served as executive vice president at Tufts Health Plan. "They're going to have to think about IT and operational challenges that are so different than fee-for-service."

Gathering data from multiple sources to participate in quality reporting initiatives currently revolving around CMS programs such as meaningful use and the Physician Quality Reporting System are a start, but they simply measure compliance with certain evidence-based measures.

The bigger IT challenge with Massachusetts ACOs will be more bottom-line oriented, Moran said. For example, an ACO will be given a single payment for a patient's hip replacement, from beginning tests to the end of rehab and physical therapy. Payers already are examining the idea of penalizing providers for readmissions or other outcomes-based measures (i.e., is the patient walking better now that he has a new hip?). Most providers can't begin to calculate the total cost of a hip replacement today, looking at all the exams, tests and services involved.

Joseph Kvedar, MD, director of the Partners HealthCare Center for Connected Health in Boston, confirmed that's probably true for many of the state's health care providers. Partners "has the pieces in its system" to put together those numbers, although it's far from perfectly interoperable.

They're going to have to think about IT and operational challenges that are so different than fee-for-service.

George Moran,
professor, Northeastern University

In global-payment schemes down the road, there may be no extra reimbursement for a readmission, and furthermore payers may delay reimbursements until the provider achieves required outcomes -- making readmissions costly and time-wasting. "Your incentive is to manage it much more effectively and think about more longer-term outcomes than the shorter-term outcomes fee-for-service does," Moran said.

The law has some specific HIT-related goals, such as holding state officials accountable for details such as the number of providers attesting to stage 2 meaningful use, if they also use state funds. In fact, it specifically mandates an oversight council to report in early 2016 on the "effectiveness and return on investment of [HIT] funding."

Kvedar said the law's provisions to help providers adopt health IT are typical for Massachusetts.

"In the state they have a long history and culture of using electronic tools to improve the delivery of care," Kvedar said. He sees the law as, on one hand, a new series of care-coordination compliance mandates but, on the other, a harmonization of goals. "We now have, essentially, 100% of our contracts with our payers being contracts for what we call 'new payment models.' That's pretty exciting, because it really does open the door for innovation in care delivery."

The law's HIT challenges of data collection and care coordination will involve some work, Kvedar said. But since organizations like Partners already have started creating an infrastructure to deal with the state's commercial payers' quality-driven programs, he feels the bigger challenge is breaking physicians' workflow habits geared toward fee-for-service payment models where patient volume is more important than outcomes. That fundamental change hasn't hit the docs and nurses, yet, he said.

Partners' upcoming HIT investments revolve around systems that can identify patients who would benefit the most for wellness and care-coordination programs, sign them up, and monitor each program's efficacy. Predictive modeling tools, he thinks, eventually will be able to determine in advance which patients will need which services and will enable Partners to "deal with most of this stuff coming down the road" in regard to payer expectations, Kvedar said.

Moran said he is encouraging his students to learn more about predictive modeling and patient data analytics tools, as well, and to do it immediately. No matter what reimbursement models come and go, these systems are the future of health IT, he feels it's important that future informaticists don't wait until a state or federal law forces them to react with compliance, but instead to get ahead of the curve and start now to be ahead of their competition.

Let us know what you think about the story; email Don Fluckinger, Features Writer or contact @DonFluckinger on Twitter.

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