MaineHealth, the state’s largest health care organization and the owner of Maine Medical Center, is changing the way it collects Medicare payments to account for the quality of care provided.
If MaineHealth meets certain quality standards and spends less than historical patterns to treat patients, it will be eligible to share in a portion of any savings. The federal program was made possible by the 2010 Affordable Care Act.
“It’s a whole different way of thinking about care and getting compensated for the care,” said Michael Albaum, chief medical officer and executive vice president of Southern Maine Medical Center in Biddeford, which is part of MaineHealth. “There’s a triple aim — to improve health, improve patient experiences and contain the global costs of providing care.”
The complicated system is part of an effort by Medicare and other payers, such as insurance carriers and large employers, to ratchet down the cost of health care. The new “accountable care organization” or ACO, program at MaineHealth follows last year’s pilot project that started with 32 organizations nationwide, including Eastern Maine Health System, which runs Eastern Maine Medical Center in Bangor.
The MaineHealth ACO, which is one of 89 newly designated ACOs nationally, will include its seven acute-care hospitals, a visiting nurse network and physician organization, among other services. Being part of the ACO program is a recognition that hospitals will be paid less in the future as federal programs clamp down on health care and other payers try to cut costs, hospital executives said.
“We know there will be less revenue coming in. There’s going to be a contraction. It’s how we weather the transition,” said Andrea Dodge Patstone, vice president of strategic initiatives for MaineHealth. “We don’t think anyone is going to go out of business overnight, but we’ll look different in a decade.”
Currently, Medicare spends about $340 million a year to treat the roughly 35,000 patients in MaineHealth’s territory. Of that, about $240 million a year would typically flow into the MaineHealth system, representing about 16 percent of the hospital group’s net patient revenues, Patstone said.
Essentially, the ACO model is an experiment to try to save money and improve the quality of care. The program shifts hospitals from getting paid on the number of beds they fill and services they provide to getting paid for the total care provided to the patient.
For example, a patient with diabetes might have trouble coordinating their medicine, following good nutritional guidelines or getting sufficient exercise. The average hospitalization for a diabetic is about $9,600 per visit, and a diabetic may bounce in and out of the hospital three times in a year, Patstone said.
Instead of spending close to $30,000 a year to care for that patient in the hospital, MaineHealth may be able to care for that patient for as little as $3,000 by proactively sending a nurse care coordinator to a patient’s home to check on their health routines, nutrition and the available support they have from family.
The ACO model tries to prevent hospitals from cutting corners and rationing care by including patient satisfaction surveys and quality care standards as part of 33 metrics — ranging from care coordination to the use of preventative health services — to determine if the health system is providing proper care.
If MaineHealth meets certain quality benchmarks, it can share up to 50 percent of the savings. If it fails to meet the quality benchmarks, it wouldn’t get any of the savings.
“The argument or concern that hospitals will stint on quality is misguided. The best evidence that that won’t happen is based on the care metrics that must be met first. There’s a lot of safeguards in place,” said Stephen Shortell, professor and dean of the School of Public Health at the University of California at Berkeley.
Although ACO hospitals may see a portion of the savings, the health centers are unlikely to get rich from the program, experts said.
“There’s not a lot of low-hanging fruit. There’s not a lot of costs that need to be cut that are obvious,” said Jeff Goldsmith, president of Health Futures Inc., a health care consulting firm, and associate professor of public health sciences at the University of Virginia. “The potential for achieving savings is slim. The system is already so tight. Whether they make money is secondary.”
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