Atrius Health reported a $38.7 million operating surplus in 2018, the largest not-for-profit independent medical group in New England announced Thursday.
The operating income and 2.1% operating margin on revenue of $1.89 billion builds on Atrius' $24.4 million operating surplus in 2017. While the industry as a whole slowly tests payment models requiring them to take on risk, Atrius' performance validates its model, said Dr. Steve Strongwater, president and CEO of Atrius Health.
"These results are a real validation of our model of care and a testament to our track record of effective prevention, access and care coordination in managing total medical expenses. Proactively serving patients and helping keep them out of costly settings like the emergency department or hospital has worked very well," Strongwater said in prepared remarks.
As financial pressures push more physician groups to join larger systems, those that have remained independent claim they are better positioned to tackle value-based care. A nimble operating structure, a higher level of cost and price sensitivity, transparency, and a more attuned physician-patient relationship have aided that pursuit, independent physician group executives have told Modern Healthcare. Notably, more doctors have been leaving health systems to join independent physician practices.
Physician groups derived a larger share of revenue from risk-based contracts in 2018 than in previous years, a recent survey by the AMGA shows. Fifty-six percent of 75 respondents' federal program revenue came from value-based payment models in 2018, up from 45% in 2015.
About 75% of Atrius' revenue is tied to full-risk contracts that hold it accountable for the quality, patient experience and total cost of care. In its first year as part of the Medicare Next Generation ACO model, for instance, Atrius saved the CMS $19.9 million and returned $15 million in savings to the organization, the company said.
Atrius said it will continue to pursue new care delivery models like its collaboration with Blue Cross and Blue Shield of Massachusetts, which provides a global budget for the care of more than 130,000 of Atrius Health's patients who are Blue Cross members. Meanwhile, the Massachusetts Health Policy Commission highlighted Atrius as the lowest user of low-value tests and screenings in the state.
Atrius serves more than 745,000 adult and pediatric patients at 31 medical practices in eastern and central Massachusetts through its 715 physicians and primary care providers as well as 425 additional clinicians.