'Too early to tell'

Though early adopters are gaining experience with accountable care organizations, evidence of their impact on quality remains limited.

The untested payment model gained favor with private payers and Medicare after policymakers included pilot programs in the 2010 healthcare reform law. Medicare has steadily expanded its reach to 250 organizations, up from the original 32 involved in the program. Major insurers such as Cigna Corp. and Aetna also have jumped on the accountable care bandwagon.

Hospitals and medical groups under an accountable care contract can earn a share of the money they save by meeting quality performance targets and by lowering the overall cost of the patient panels enrolled in the program. The vehicle is designed to neutralize the incentives to deliver high-volume care associated with fee-for-service medicine. Policymakers believe simultaneously paying for quality and cost control will improve outcomes and not risk stinting on care.

But whether accountable care will work as designed is still an open question. “It's too early to tell,” said Kavita Patel, a fellow in the Economic Studies program and managing director for clinical transformation and delivery at the Engelberg Center for Health Care Reform. The Engelberg Center and Dartmouth Institute for Health Policy & Clinical Practice were early advocates of accountable care in public policy and private markets and helped to launch four accountable care pilots in late 2010 and early 2011.

The evidence from the field is mixed. In Louisville, Ky., Norton Healthcare's accountable care contract with insurance giant Humana has made differences in some quality measures but no mark in others in its first two years.

In Sacramento, Calif., an ACO among Dignity Health, Hill Physicians and Blue Shield of California curbed the number of patients who leave the hospital only to return within a month, which usually means those patients did not get the needed care to keep them home. Reducing readmissions can keep providers from getting penalized by Medicare, which now lowers overall payments by up to 2% if readmission rates are high.

Officials at the systems in Louisville and Sacramento say more can be done to expand on admittedly limited initial quality measures.

Future efforts at Norton will likely focus on more sophisticated tracking of quality measures through wider adoption and better use of electronic health records, said Marcia James, director of provider engagement for Humana. Norton's outpatient locations fully adopted EHRs last August and its hospitals in March.

Follow Melanie Evans on Twitter: @MHmevans