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February 2018 - Accountable Care Organizations

Posted by Emerald Coast Medical Association on Feb 26, 2018 10:39:37 AM

We had a very insightful and meaningful meeting on Wednesday night. Our physician community has been inundated with word soup for the past few years and just recently with the term “clinically integrated network”. Chris Emper flew in from out of town to give us very helpful definitions of Accountable Care Organizations (ACOs), Independent Physicians Associations (IPAs), and Clinically Integrated Networks (CINs). He then further discussed what each entity means for us as physicians. For those of you unable to attend, I wanted to provide an overview of the discussion as this topic is extremely important to our practices.

I will start with mentioning my summary may be subject to potential bias. I am writing as a solo independent practitioner. I have not had particularly good relationships with hospital administration in the past two to three years. I feel we are undercut by both commercial and government payors. I feel we are constantly losing our autonomy to practice medicine in a way we know is safe and beneficial to our patients.

Operating a small independent practice is extremely difficult for many reasons. Only one reason is the persistent narrowing of our operating margins. Practice expenses continue to rise, and payments are flat at best. Economically this is a failing business model.

There are only two ways to increase reimbursement in medical practice to improve your bottom line. One you can play the MACRA game and hope for a small increase in pay from Medicare via MIPS or APM (4% max in 2019). Two you can hope for a better contract with your commercial payors. Both options are difficult as a small practice. The MACRA game is expensive and time consuming. Negotiating with commercial payors is impossible without significant physician numbers.

Therein lies one of the impetus for the development of ACOs, IPAs, and CINs. Through these entities physicians can share cost, share manpower, and negotiate as a group. In order to lawfully negotiate multiple physician payor contracts, you have to either share financial risk (same tax ID number for instance) or participate in a clinically integrated network. A CIN is basically a way for physicians to share patient data with the goal of improving quality and cost of care. In order to start and then have a successful CIN or other organization you need two things…trust and strong governance structure. Trust has been a big issue in our own physician community. This is why these types of organizations have failed to start and/or gain traction in our area.

There is a current opportunity to join the Coastal Health Alliance, which many of you have likely been exposed to by office visit, email, phone call, or other. It is advertised as a clinically integrated network. It is truly in the infancy stage and at current is somewhat of a blank slate. The “Alliance” as it is referred to was kick started by Bay Medical Center Sacred Heart (BMC). BMC spent the money and provided the initial manpower to get the Alliance started. Therein lies a huge advantage of the Alliance, as starting a CIN is expensive. The Alliance is led by a Board of Managers consisting of eight members. Three of the members are BMC administrators. Five of the members are physicians, two of which are employed by BMC. Signing on costs you nothing and you can leave the Alliance with a 90-day notice.

As a member of the Emerald Coast Medical Association you are basically a part of an IPA. Through our Association we too can start a CIN. The difference will be this CIN will be started and managed by our physician members. Through this CIN we can collectively submit data to CMS, negotiate contracts with commercial payors, negotiate pricing with medical supply vendors, etc. As an association our members simply need to collectively make a decision if this is something we want to organize through our association. Through our medical association we can help shelter costs and garner the needed manpower. We need your voice to know where you stand and if you want our board to look further into the details. We would then report back to you during our next members meeting in March. I apologize for the length of this message. I hope you find it helpful. Please do not hesitate to contact myself or Michelle with any questions. I hope you will reach out to one of us to let us know your voice.

Your friend, colleague, and past president, Alex Jones

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