GE Healthcare Camden Group Insights Blog

MSSP and NGACO Application Windows Quickly Approaching

Posted by Matthew Smith on Apr 6, 2016 11:50:17 AM

By Daniel Juberg, Manager, GE Healthcare Camden Group

ACO News, MSSP, NGACOCMS recently launched the first step of the application process for its Next Generation ACO (“NGACO”) Model, and next month opens the window to apply for the Medicare Shared Saving Program (“MSSP”) Initiative. The NGACO, CMS’ newest two-sided risk model, accepted 21 organizations for 2016. The MSSP, which also added enhanced risk-based options in 2016, had 100 new ACO participants this year, bringing the total to 434 ACOs at the start of the year. These numbers reinforce CMS’ stated goal to move 30 percent of traditional Medicare fee-for-service payments into alternative value-based payment models by 2016, and 50 percent by 2018.

MSSP: Zero Downside Risk

The MSSP Model was introduced in 2012 as a key component of the Medicare delivery system reform initiatives found in the Affordable Care Act and a new approach in the delivery of health care intended to facilitate coordination among providers to improve the quality of care. Among the primary attractions of the MSSP was the option to participate with zero downside risk, meaning if organizations outspent their target expenditures, they would not be liable to repay the difference to CMS. Through Track 1 there existed only upside, or the ability to share in any savings generated, an appeal that the MSSP Model maintains to this day. This allows organizations to dip their toes in the accountable, value-based waters and develop the infrastructure necessary for future success while still participating in a fee-for-service environment today. And the participating organizations have largely voiced their approval of the program – more than two-thirds renewed their participation when their initial agreement ended in December.

NGACO: Higher Risk/Higher Rewards

While the MSSP Model was the right first step for many organizations beginning their journey towards value-based care, it was in many ways insufficient for more advanced organizations experienced in care management and risk-based contracting. Thus the Next Generation ACO model was born, providing a higher-risk, higher-reward alternative to the MSSP, while simultaneously responding to and improving upon its oft-maligned and challenged predecessor, the Pioneer Model, with a refined attribution process and enhanced benchmarking methodologies. Now organizations can select between two risk options from 80 to 85 percent on the shared savings option all the way to a full-risk opportunity. Now if organizations overspend their benchmark expenditures, they will have to cut CMS a check at the end of the year. This may seem daunting, but many organizations view this as the natural programmatic evolution and that the increased skin in the game can be the push their organization might need to really enact the necessary transformation. In fact, seven of the new NGACO participants came from the MSSP program, demonstrating the interest of existing program participants to advance their risk exposure and opportunity based on their work and success to date.

The NGACO, with its enhanced risk profile, is obviously not for everyone, which explains why only 21 were accepted in the past cycle. As stated above, the NGACO was effectively developed for those organizations with experience in commercial ACOs or with value-based contracts, or that had experienced success in the MSSP and had outgrown the less-lucrative risk arrangement. Accordingly, in addition to the seven MSSP converts to the NGACO program, eight made the transition from the similarly two-sided, but less favorable Pioneer model.

Deadlines Approaching

The good news for organizations wanting to prepare for a value-based future is that the 2017 application windows for both programs are upon us. Organizations contemplating their fit in either initiative can apply for one or both, but need to submit their Notice/Letter of Intent by the respective deadlines to be considered. These submissions are non-binding, so we encourage organizations at all considering participation to file one and then assess their options in the next few months. One caveat is that while organizations can simultaneously apply for both models, they will ultimately only be able to participate in one of the two initiatives.

The NGACO Letter-of-Intent is due May 2, with the MSSP Notice-of-Intent due May 31. Additional key milestones for both models can be found below:


With the continuous innovations of both payment and delivery models, CMS is maintaining its commitment to the transformative shift to value-based care. While that momentum is undeniable, not all organizations are necessarily ready for that transition just yet, particularly in the riskier models. We recommend undergoing a comprehensive (and candid) self and market assessment of your organization’s present situation and evolution in what GEHC Camden Group considers the eight core domains essential for clinical transformation to successfully thrive in a value-based world. A commitment must be demonstrated in the below key operational competencies in order to achieve success in the changing landscape.


CMS has reiterated its commitment to population health with its ongoing development and support of these accountable initiatives. Even more encouraging, CMS has demonstrated a willingness to adapt and improve to encourage participation and collaboration. The strongest healthcare organizations tend to be the ones that are proactive rather than reactive. For organizations that can see what’s coming down the tracks, there may be no better time than now to begin preparing for a value-based future.


Next Generation ACO


juberg_headshot.pngMr. Juberg is a manager with GE Healthcare Camden Group and focuses on clinical integration, transactions, and strategic and business planning for healthcare organizations. He has extensive experience with the development of ACOs (financial planning and funds flow modeling), managing Medicare Shared Savings Program applications, and implementing clinically integrated networks. He is also experienced in master facility planning, CMMI Innovation Center grants, medical group valuations, and community needs projections. He may be reached at daniel.juberg@ge.com.


Topics: ACO, MSSP, Population Health, CMS, Next Generation ACO Model, MSSP ACO, NGACO, Daniel Juberg

10 Myths of Population Health and Clinical Transformation

Posted by Matthew Smith on Mar 1, 2016 11:40:34 AM

By Daniel Juberg, Manager, and Megan Calhoun, MS, MSW, Manager, GE Healthcare Camden Group

Myths, Clinical Integration, Population HealthIt is a confusing time in United States healthcare. Healthcare organizations are faced with the new reality of value-based care and are identifying the necessary steps for success in an evolving healthcareenvironment. For many, this transformation is difficult, and fear of this change may hinder progress. However, at present, a lack of true understanding of the care processes, tools, and consequences of this transformative shift persists in the healthcare community, and with the public at large. The delivery and consumption of care is rapidly changing for both provider and patient, and not everyone is on the same page. Below are ten myths associated with clinical transformation and its ability to position an organization for success in a value-based world, along with the realities with which providers and organizations must face.

Myth #1:  The best care (or better care) is provided in hospitals.

RealityFor many years, the United States healthcare system has been very hospital-centric. Patients who were sick were directed to go to the Emergency Room or the hospital to get better, and physicians were paid handsomely for services provided in the hospital setting. This cycle has engrained within Americans (and within many physicians) that the hospital is the setting for receiving the highest quality of care. Patients will often even ask to be admitted to the hospital because they believe superior care will be provided there. Today, the healthcare system has begun to shift to improve and increase the suite of outpatient healthcare services to include ambulatory surgery centers, urgent care centers, retail clinics, even home-based care. The hospital is no longer the only place to go to receive care and, in fact, the best interventions will keep patients safely in their homes and out of the hospital altogether.

Myth #2:  All organizations should be negotiating value-based payment contracts.

Reality:  While value-based payments are a driver for clinical transformation, organizations should move at the pace of their market (and their own capabilities). Each market across the county differs in its pace in the shift from a volume to value-based environment. Organizations who are maintaining success in a primarily fee-for-service environment may not be ready for an immediate switch to value-based payments. Instead, these organizations should begin undertaking efforts to prepare for an eventual change to value-based contracting through improved medical management efforts and regular analysis on clinical outcomes and cost of care. This transition for some has had to be rapid, given the speed with which the market had adopted value-based payments. However, for many others who are not yet positioned for success in a value-based market, this transition should be gradual as the organization begins to develop the necessary capabilities; in a volume-based environment, these changes can still have positive outcomes through a focus on treating patients in appropriate care settings, thereby increasing capacity and access. Therefore, the focus for all organizations should be developing and implementing the clinical care model that is in sync with its payer contracting strategy.

Myth #3: Interoperability among information technology (“IT”) systems results in clinical integration.

Reality: As healthcare organizations begin to explore the clinical transformation needed to achieve clinical integration, the number one barrier frequently identified is the lack of interoperability among the health IT systems. Often, organizations may decide a complete IT overhaul is necessary (very costly) or that clinical integration is simply not possible and withdraw from the effort. However, highly integrated IT systems do not magically result in clinical integration. IT systems lack the clinical judgment that is necessary to provide high-quality, patient-centric care. IT systems cannot identify population health objectives and goals and design interdisciplinary medical management programs that aim to meet population health goals. It is the aligned vision for improving health outcomes among all care team members that results in clinical integration; IT systems can simply enable this type of care through real-time alerts, evidence-based clinical pathways, and historical and predictive trending of clinical data and notes. Interoperability should be viewed as a means, not as a deal breaker in its absence.

Myth #4:  Electronic Medical Records (“EMRs”) make physicians lives easier and provide better patient care.

Reality: Advances in technology have provided innumerous innovations to the majority of industries and society in general. While healthcare has been an undeniable benefactor, it is widely assumed that because electronic tools have made the public’s lives significantly easier, healthcare providers have experienced the same benefits and welcome all advancements. Healthcare IT, including EMRs, can provide the care team (e.g., the physician, medical assistant, nurse, social worker, or other care coordinator), with a wealth of knowledge about each patient. Tools exist that track and trend lab results, maintain and update a singular care plan, and provide point-of-care alerts to close gaps in care. Many organizations rely heavily on the information provided through these tools to provide patient-centered, high-quality care. However, it is not the information contained within these tools that has enhanced patient care; instead, it is the care processes and workflows that have been developed to ensure this information is meaningful and utilized that has enhanced care. Without clear care protocols or actionable reports, physicians can be frustrated by the vast amount of information presented to them and the myriad of tasks they must complete within multiple IT systems. Too much data contained in a myriad of health IT systems can actually result in less coordinated care between physicians and across care settings. It is the integration of this information, in a succinct form, into clearly defined care processes that enables the delivery of high-quality patient care and allows the technology to ease the burden on the provider, rather than add to it.

Myth #5: Population health management requires significant IT capital and increased staffing.

Reality: Additional capital to support informatics and staffing are a luxury and can improve efficiency and effectiveness of care management initiatives, but they are in no way a necessity for population health management. Population health management begins with a cultural transformation within the organization that is centered on a dedication to providing high-quality, patient-centric care. A clinical transformation subsequently occurs that leads to the development and establishment of refined clinical pathways and processes and often the redeployment of staff. IT tools can assist with these processes, but they should not drive the clinical transformation that needs to occur within the care teams. Similarly, the role of support staff (e.g., care managers, social workers, health coaches) does not actually increase; instead roles are assessed and redefined, as necessary, to ensure staff resources are deployed in a manner that is targeted to meets the needs of the population and the associated intervention. Too often organizations making this transition attempt to run before they can walk.

Myth #6: Clinical integration results in mass layoffs of staff.

Reality:  The Triple Aim® consists of three components: improved health outcomes, improved patient experience, and reduced overall cost of care. While it is imperative that all three of these tenets are taken into consideration for successful clinical transformation, providers frequently focus on the latter and associate it with cost and workforce reductions. Often, organizations are not over-staffed for population health management; instead, staff members are simply not working to the top of their license and are not always providing care to the right cohort of patients, at the right point in time, with the right care interventions to meet the patient’s needs. A reduction in staff will only increase the volume strain all staff is already experiencing. Instead, an assessment and redesign of clinical protocols should inform the medical management staffing. A re-deployment of staff may be necessary to ensure staffing levels are congruent with the acuity of the patient population, and additional training may become necessary to ensure all staff members are able to perform effectively and efficiently in new roles. In many cases, rightsizing can be replaced by adhering to clinical protocols and reallocating existing workforces.

Myth #7: Buying services that span the continuum is the only way to achieve clinical integration.

Reality:  The desire to purchase services that span the continuum stems from a need to be able to share clinical information, conduct warm handoffs between care settings, and keep healthcare costs and revenue under a single umbrella. However, just because an organization may own these services does not mean that these services are the highest quality, nor even utilized by other providers in the continuum. What is most important when developing a clinical integration model is the provision of high-quality, patient-centric care across the continuum. Services do not need to be owned to meet this obligation. Organizations should be looking, instead, to develop formal relationships with the most high-quality and value-based healthcare service providers. Referrers should have access to cost and quality metrics for all partner organizations and should utilize these results to drive care to the most appropriate providers. Preferred networks should be developed to enable care model development in conjunction with these partner organizations, all with the intent to provide patients with coordinated, seamless care transitions across care settings and, when appropriate, back to their home. There are several ways to achieve tightly aligned networks – organizations should be judicious when deciding if ownership over all components is the right strategy for them.

Myth #8: Maintaining universal physician satisfaction is a critical success factor for population health management.

Reality:  Physicians are critical to cultural and clinical transformation – this is an undeniable truth. However, not all physicians are well-educated about or in favor of clinical transformation to position them for success in population health. Some may be nearing the end of their careers, and this change may present a large burden. Placating to physician needs and preferences will not always bring about successful and unified change within an organization. Instead, try performance transparency. Initially, this may cause some discomfort among physicians; however, no physician wants to be the poorest performer, and this tactic may bring about the most rapid change in behavior. The enforcement of remedial action plans for physicians who do not follow established evidence-based protocols may also not be welcomed by all physicians, but will ultimately ensure that high-quality care is provided. While physician engagement is a critical element for success in population health management, it must be a mutual effort. Organizations that make the successful voyage to population health management need to weed out those vocally not on board, as well as those refusing to row in the same direction in their practices.

Myth #9: Patient satisfaction is the same as optimizing the patient experience.

Reality:  Despite what physicians may think, patients aren’t really rating physicians on whether they “always communicated well with them” or “always controlled their pain well.” The truth is that patient satisfaction has many components. Ultimately, patients are rating physicians on factors such as whether they got better and had timely access, which can ignore critical aspects such as the cost and appropriateness of care being provided. One prominent study contended that patients who reported being most satisfied with their physicians had higher healthcare and prescription costs and were more likely to be hospitalized than less satisfied patients. Could physicians who have patient satisfaction scores tied to their compensation be less likely to advocate against unnecessary requested treatments or less likely to raise concerns about lifestyle and behavioral modification issues?  Or could there be a correlation between high patient satisfaction scores and providers who actively tackle the hard-to-discuss issues the best? More research – and specifically innovative research – is necessary. Further complicating this issue is the new trend towards Yelp-style online public reviews influencing local perceptions of healthcare providers. As with any crowd-sourced review product, an issue arises when the public tends to only be inclined to offer their opinions when the service is exceptional, or the experience was considered an unpleasant one. Managing digital perceptions is yet another responsibility that consumer advancements and innovations have required of providers.

Myth #10:  Patient satisfaction will increase if physicians spend more time with each patient.

Reality: Patient satisfaction is about much more than the length of an appointment. Ultimately, patients are concerned about receiving personal, high-quality care at the time they need it. A patient will be satisfied with their care if they feel they can access it when they need it; for example, when a patient is able to schedule an appointment on the day and at the time they wish to see their physician or other provider and if their wait time is minimal.  Or, when a patient contacts their physician via a patient portal and receives a timely response. Furthermore, the patient wants to feel as though their physician is utilizing the appointment time to truly discuss their care, rather than reviewing old notes and labs and consistently typing on a computer; patients respond very positively to eye contact and listening skills as indicators that a physician is interested in a patient. A medical assistant or other office support staff can greatly assist physicians prepare for their appointments so that patients feel as though they are receiving the physician’s full attention, thereby bolstering the patient’s satisfaction with their visit.

juberg_headshot.pngMr. Juberg is a manager with GE Healthcare Camden Group and focuses on clinical integration, transactions, and strategic and business planning for healthcare organizations. He has extensive experience with the development of ACOs (financial planning and funds flow modeling), managing Medicare Shared Savings Program applications, and implementing clinically integrated networks. He is also experienced in master facility planning, CMMI Innovation Center grants, medical group valuations, and community needs projections. He may be reached at daniel.juberg@ge.com.

Megan.pngMs. Calhoun is a manager with GE Healthcare Camden Group and specializes in the areas of care management strategy and design, strategic and business planning analysis, accountable care organization applications, development and implementation, and the development of clinically integrated organizations. Ms. Calhoun has supported numerous clients with the completion of Medicare Shared Savings Program (“MSSP”) applications and implementation strategy and planning. Her experience includes care model design and implementation that spans the continuum. She may be reached at Megan.Calhoun@ge.com.

Topics: Clinical Integration, Population Health, Regional Clinical Integration Networks, Daniel Juberg, Megan Calhoun, Clinical Transformation

Top 10 Pivotal Factors for Successful Mergers and Acquisitions

Posted by Matthew Smith on Oct 28, 2015 3:32:11 PM

Mergers and acquisitionsAs the healthcare landscape moves further down the tracks along the transformative shift towards accountable, value-based care, healthcare providers find themselves inundated with news and rumors of major players and competitors engaged in discussions surrounding acquisitions or affiliations. From the potential merging of three sets of health plan giants, to private equity players venturing further into the health system (e.g., hospitals, imaging, and physician practice) and post-acute space, the changing climate is undeniable and may prove for many to be inescapable.

Healthcare executives are surveying industry change, their market position, and their ability to meet organization goals and mission as they evaluate opportunities while simultaneously protect the well-being of their own organization. However, for a variety of factors, from operational to financial to cultural, not every consolidation is the right one. Before savvy leaders dive headfirst into the current merger and acquisition frenzy, they need to take a measured step back and assess the following ten factors that will prove pivotal to a successful merger or affiliation.

1. Define your mission, vision, and objectives. In a constantly evolving and unclear environment, it is critical to thoroughly articulate the ambitions of any significant change your organization is contemplating. Why is your organization considering this alliance, and will this arrangement help achieve desired goals? The reasons for mergers are plenty. Acquiring economies of scale, achieving geographic expansion, increasing access points, and enhancing access to capital are among the primary motivations in the current transformative climate. Gaining consensus among your board and executive leadership early will contribute to a unified search process, enhance communication, and align your key stakeholders.

2. Timing is everything – determine the right time. In a period of high consolidation activity, it is easy to get wrapped up in the excitement. Do your organization’s current position and situation necessitate a move right now? Many organizations rush to the negotiating table without fully assessing whether the timing is optimal, or if they are ready for the transition. Conversely, the market today does not look like the market did six months ago, nor will it look like the market six months from now. As the market evolves, so do options both available and unavailable to your organization. Potential targets or acquirers may align with competitors, or market activity could force your organization’s hand to the point where consolidation is the only option. A keen awareness of your organizational strength and market position is paramount when evaluating potential maneuvers.

3. Know the market – what is your outlook for the future, and what is its effect on your organization? The shift towards value-based payments and accountable care means that now more than ever healthcare providers are forming “tightly aligned” networks to reduce costs and improve the quality of patient care. Are other major players expanding their population base through additional access points, developing accountable care organizations (“ACOs”) and exclusive contracting arrangements, and creating a full continuum of care into the post-acute arena? The organizations with critical mass are going to come out on top. Failing to adequately assess your competitors and their situations could portend a situation where your affiliation options become limited and your market share eroded.

4. In a value-based environment, size matters. How can you increase your defined population? As mentioned above, for thriving and financially sustainable providers, it will be crucial that they grow, fortify, and protect the defined population that they serve. It is becoming increasingly crucial that organizations provide sufficient access points to coordinated provider networks through both traditional mediums (emergency departments and physician offices) as well as innovative entry point alternatives found in the new competitive provider environment that exists today (health plans, urgent care centers, m-health, and retail clinics). Consider alternative points of care to acquire or affiliate with in order to expand access and improve the coordination of care for your population – your competition likely is.

5. Choose the right affiliation structure – there are more options than just mergers and acquisitions. Today’s healthcare environment provides an increased number of innovative alignment options for organizations contemplating integration. Gone are the days where organizations needed to complete outright sales or mergers with full change-of-control. Instead, many organizations are pursuing affiliations to meet organizational goals and strengthen financially, including joint ventures, clinically integrated networks, sales to real estate investment trusts, or joint operating agreements. Affiliating can be an attractive option to maintaining a degree of organizational independence while propelling the organization’s mission and fulfilling its defined objectives. Just be clear that the affiliation structure will be the best option to meet your goals.

6. Evaluate cultural alignment to protect against breakdowns once the transaction is complete. Easily the most overlooked aspect of any potential merger is the eventual fusion, and potential friction, of combining two organizational cultures. Post-transaction success requires more than diligent financial analysis and combined market share. More and more transactions are stumbling out of the gates because leadership underestimated the difficulty of one or both organizations adopting new protocols and systems, blending the governing boards, or understanding management styles and philosophies. Assessing the history, mission, and cultural aspects of each organization is imperative to develop the understanding required to construct the mutually beneficial and shared vision necessary to achieve the future entity’s operational efficiencies and full potential.

7. Ensure that both boards and communities are behind the transaction and mission. Good communication is required to ensure as smooth a process as possible with any transaction. It is vital that all key parties, from the boards and medical staffs to employees and patients, have a firm grasp of why the organization is pursuing this action, and how they will benefit from it. Achieving alignment and understanding among the community will confirm the necessary parties are in sync while addressing and relieving any anxieties the deal may foster.

8. Conduct effective due diligence to ensure that the efficiencies and business justifications support the transaction. During the due diligence process, it will become clear how your potential partner is performing: their vision, goals, actions, and composition of the C-suite and board. The due diligence process is the appropriate time to ask as many questions as possible; it is imperative that you get the answers you need. A high frequency of meetings and discussions, particularly face-to-face interactions, and transparency with financial and quality data are strongly encouraged to generate the necessary levels of understanding to ensure the transaction remains compliant with antitrust legislation and that the market benefits desired and proposed are feasible.

9. Consider the partners’ “whole being” as an organization that can meet your needs. As an organization, identify how future industry changes will impact your needs across the care continuum. This may include bundled payments, ACOs, clinical integration, patient-centered medical homes, ambulatory delivery sites, payment changes, access to capital, new care models, and health plans, etc. Physician alignment models, recruitment, and research are also opportunities that should be addressed. Projecting future industry developments and the impact to your strategy and needs could put your organization ahead of the game in the years to come.

10. Once the merger is complete, execute the business plan of operational efficiencies (“BPOE”) to position your organization to achieve the gains that were the reason for the merger. The BPOE serves as a great tool to define the financial, operational, and clinical opportunities that will be gained through the merger before it happens. After the transaction is complete, use the BPOE to measure and manage progress on the implementation actions necessary to achieve the intended goals and efficiencies. These may include program and service consolidation, elimination of service duplication, and infrastructure integration. Theoretical synergies mean little without implementing and actualizing them. The BPOE should serve as the blueprint to follow in order to propel your organization to enact the clinical, operational, and financial benefits that compelled the transaction in the first place.

Mr. Valentine is president of The Camden Group, one of the nation’s largest healthcare management consulting companies with offices in California, Illinois, New York, and Massachusetts. With more than 35 years of healthcare consulting experience, he has considerable expertise in the areas of strategic planning, business transactions, mergers, hospital-physician relationships, and financial analysis. Mr. Valentine authors the annual “Top 10 Trends in Healthcare” for Trustee. He is a nationally recognized author and speaker on healthcare issues. Mr. Valentine is often quoted in Payers and Providers, Modern Healthcare, Los Angeles Times, and HealthLeaders, as well as other publications. He may be reached at svalentine@thecamdengroup.com or 310-320-3990.

Mr. Juberg is a manager with The Camden Group and focuses on clinical integration, transactions, and strategic and business planning for healthcare organizations. He has extensive experience with the development of ACOs (financial planning and funds flow modeling), managing Medicare Shared Savings Program applications, and implementing clinically integrated networks. He is also experienced in master facility planning, CMMI Innovation Center grants, medical group valuations, and community needs projections. He may be reached at djuberg@thecamdengroup.com or 310-320-3990.


Topics: Steve Valentine, Mergers, Acquisitions, Daniel Juberg, Mergers & Acquisitions, Mergers and Acquisitions

The Medicare Shared Savings Program's 2014 Performance Results: Uphill Battle or Steep Learning Curve?  

Posted by Matthew Smith on Aug 27, 2015 3:29:59 PM

By Mishka Glaser, MA, CISA, Manager, and Daniel Juberg, Manager, The Camden Group

MSSP, ACO, Healthcare Savings, The Camden GroupThe difference between an uphill battle and a steep learning curve is perspective. In the end, both depict a difficult task that ultimately requires lots of effort.

With the recent 2014 Medicare Shared Savings Program (“MSSP”) performance results announcement from The Centers for Medicare and Medicaid Services ("CMS"), is it really surprising that fully “three out of four Medicare accountable care organizations did not slow health spending enough to earn bonuses last year," as Modern Healthcare has pointed out? The U.S. healthcare system is currently disjointed with years of conditioned responses from every part of the delivery system, from patients to providers and everywhere in-between.

Systematic Barriers

The results should not come as a surprise to those who have been monitoring the healthcare environment for any significant period of time. There are two systemic barriers impacting Accountable Care Organizations' ("ACO") ability to drive the cost of care downward to target thresholds:

  1. Change is an uncomfortable and slow process. The healthcare industry is learning to adopt the necessary structures for successful change to a value-based payment and population health model. This is a paradigm shift for all players in the healthcare delivery space, from the traditional providers such as physicians, care teams, and payers, to less conventional participants such as health information technology companies and patients.
  2. The complexity of delivery system transformation creates competing priorities which must be coordinated effectively to be successful. For example, challenges include a participating ACO’s ability to:  
    1. Process, utilize, and communicate the copious amounts of data needed to make useful programmatic decisions
    2. Reach beneficiaries and have meaningful engagement surrounding their health status and the behavioral changes necessary to drive improvement
    3. Balance the need to provide the right care in the right setting (therefore reducing hospital volumes, shortening length-of-stay and use of emergency room visits). This places further burden on often already struggling hospital margins
    4. Change provider behavior when payment mechanisms are still rewarding additional visits, tests, and existing, inefficient care models

Barometers of Success

At the heart of the MSSP is a fundamental change in the way healthcare is conducted and measured. Make no mistake - there aren’t any tried and true, proven recipes for success; however there are some key indicators for MSSP success that are emerging. Two predictors of strong program performance are a commitment to care coordination and a detailed analysis of clinical and claims data to properly stratify the entire population while simultaneously drilling down to understand the individual patient and tailor a care plan to their specific needs. Without a committed focus on these barometers of success, the MSSP ACOs in particular, will be hard-pressed to improve performance and surpass their minimum savings threshold in order to ultimately achieve their goal of shared savings.

This is not an exact science - certainly a collection of ACOs may have early wins based upon a variety of factors, whether it’s their previous experience with risk-based programs, market trends, or engaged and active physician practices. However, for the majority of ACOs that find themselves in the unenviable position of having made the initial investment of developing an ACO with nothing to show for it to date, the key to taking the next step to reduce total beneficiary expenditure while improving patient outcomes and overall population health will be a continued and diligent focus on tightly-aligned care coordination and actionable data analytics.  

Despite the MSSP Track 1 being seen as a “no-risk” entry into the accountable care environment, organizations were in fact risking their valuable time and effort, provider engagement, and startup capital, with no guarantee that these investments would achieve their desired intent. While it is true that organizations were afforded participation in the MSSP with zero downside risk (meaning they were exempted from having to pay back CMS should they overspend their population benchmark), many organizations struggled in carrying through the well-constructed vision statements detailed in their program applications to CMS.

Building a Bridge to Accountability

The MSSP program was developed to incentivize the behavioral changes that are needed to make the transformative shift toward value-based care and population health and, frankly, as a learning center for provider organizations to build a bridge from traditional fee-for-service care delivery to a new model with emphasis on accountability, outcomes, and ultimately, performance. The first two years of performance data suggest that for a majority of organizations, assistance with prioritizing and operationalizing their tactics may be necessary.

This isn’t to imply that there weren’t positive developments from the latest CMS performance announcement. While the number of organizations achieving shared savings remained constant (approximately 27 percent for 2012/2013 and 2014), the overall number of organizations spending below their prescribed benchmark and successfully earning shared savings increased from 58 last year to 92 this year, saving an additional $101 million dollars. Further, there were 89 ACOs who reduced their expenditures but unfortunately did not reduce them enough to meet their minimum savings threshold.

There was a positive relationship between participating organizations and quality improvement. In fact MSSP ACOs showed improvement from last year’s results in 27 out of the 33 quality measures, including patient survey results and preventative health measures. MSSP ACOs achieved superior performance rates on over 80 percent of the quality measures relative to other Medicare fee-for-service providers who also reported through the Group Practice Reporting Option.

Increased Focus Yields Positive Results

There appears to be a relationship between improved quality and amount of time a participant has been in the MSSP. ACOs that participated in both 2013 and 2014 improved on over 80 percent of the applicable quality measures, while the amount of ACOs successfully achieving shared savings climbed with each additional year in the program (37 percent success rate for 2012 MSSP starters, nearly double the 19 percent rate for 2014 entrants). This indicates that with increased experience, focus, and coordination come positive results. More organizations are continuing on the path and slowly but surely crossing that bridge.

Of equal importance was the news that no Track 2 ACOs (those incurring downside risk) owed CMS losses. This lends credibility to CMS’ belief in the ability of the risk-based programs to shift provider behavior, particularly when there is skin in the game. With innovative new risk-bearing payment models being rolled out this year such as the MSSP Track 3 and Next Generation ACO, this development should be heralded as encouraging news in incentivizing provider organizations to invest in the necessary infrastructure and care management programs. Ultimately the various models are preparing organizations to survive and thrive as the landscape shifts to these alternative payment models.

The healthcare industry is still in the beginning stages of learning to measure success through a different set of lenses. However, these results continue the theme that this has not and will not happen overnight. While financial success is surely near the top of the list on how to measure accomplishments in these initiatives, when dealing with the large-scale, systematic changes necessary, there are many contributing factors that must be measured and utilized to better determine success.

While it remains to be fully determined whether successful participation in the MSSP will ultimately represent an uphill battle for the majority of ACOs or simply one with a steep learning curve, one thing has been confirmed from the 2014 performance reports. Simply signing up for the program without dedicated focus on operationalizing the necessary paradigm shift will likely fail to produce the desired results.

The ACOs on top of the hill didn’t fall there. For the rest, it’s time to start climbing.

Ms. Glaser is a manager with The Camden Group, specializing in clinical integration, accountable care, and many other innovation strategies. She brings over 15 years of experience in various sectors of healthcare including physician practices, insurance, and pharmaceuticals. Ms. Glaser’s in-depth knowledge of value-based care operations provides a context for assisting clients in navigating population health. She may be reached mglaser@thecamdengroup.com;or 312-775-1700.



Mr. Juberg is a manager with The Camden Group and focuses on clinical integration, transactions, and strategic and business planning for healthcare organizations. He has extensive experience with the development of ACOs (financial planning and funds flow modeling), managing Medicare Shared Savings Program applications, and implementing clinically integrated networks. He is also experienced in master facility planning, CMMI Innovation Center grants, medical group valuations, and community needs projections. He may be reached at djuberg@thecamdengroup.com or 310-320-3990.


Topics: Medicare Shared Savings Program, Mishka Glaser, MSSP ACO, Daniel Juberg

Pioneer ACOs: Pass or Fail, the Model is Here to Stay

Posted by Matthew Smith on May 14, 2015 1:13:38 PM

By Daniel Juberg, Senior Consultant, The Camden Group

aco_logo-gold.pngLove them or hate them, it’s that time of year when America is getting inundated with high-profile, big budget sequels. The Centers for Medicare and Medicaid Services (“CMS”) is getting in on the act with a follow-up and expansion to the controversial Medicare Pioneer Accountable Care Organization ("ACO") program that was launched in 2012. Following the recently released positive results for the program from 2012 to 2013, CMS is declaring the program a success. But then, why did over 40 percent of the Pioneer ACOs drop out of the program in the first place? And just how should healthcare providers react to this expansion news?

Launched in 2012, the Pioneer ACO Model was designed for healthcare organizations and providers who were already experienced in coordinating care for patients across care settings. Through the alignment of provider incentives to improve quality and health outcomes for patients across the ACO, the program aimed to transition more rapidly from a shared savings payment model to a population-based payment model. The Pioneer Model operated on a track that was consistent with the more popular Medicare Shared Savings Program ("MSSP"), but with greater downside risk and greater levels of shared savings for successful performance.

CMS only allowed organizations to participate that it believed to be the most experienced in care coordination and with the highest chance of success. This led to only 32 brave, inaugural ACOs, or “Pioneers,” as CMS’ first batch of participants. Since 2012, 13 of the 32 Pioneer ACOs have left the program, either exiting Medicare accountable care models completely or transitioning to the less lucrative but also “zero risk” MSSP (Track 1). The majority of ACOs who exited the Pioneer program reportedly found it too costly, too risky, or just simply too complex.

Nearly $400 Million in Pioneer ACO Savings 

However CMS recently announced that, in total, the 32 Pioneer ACOs combined for $384 million in savings over the two-year period, an average of $300 in savings per beneficiary annually. This reduction was achieved largely through a population exhibiting lower hospital utilization, incurring fewer tests and procedures, and undergoing more provider follow-ups after being discharged from a hospital. These positive results have expedited CMS’ stamp of approval for expansion to a larger population of beneficiaries.

What remains unclear is exactly how these ACOs achieved the results and how to establish a more sustainable model (the ACOs saved substantially more in 2012 than in 2013 - $280 million vs. $105 million). But what is clear is CMS’ intent with their latest exuberant declaration: ACOs and population-based payment models are here to stay.

The first wave of CMS’ commitment to promoting the shift in payment methodologies was with the proposed new Track 3 through its MSSP. CMS is currently inserting the design elements from the Pioneer ACO model into the proposed Track 3. Traditionally ACOs participating in the MSSP had two risk arrangement options: Track 1, which presented no downside risk but a lower shared savings rate; and Track 2, which offered a greater shared savings rate but came with the burden of shared losses as well. The proposed Track 3 offers a higher maximum shared savings rate in exchange for accepting greater downside risk. Track 3 proposes a shared savings rate up to 75 percent based on quality, 15 percent higher than in Track 2. However, under Track 3, the ACO’s proposed shared loss rate ranges from 40 to 75 percent based on quality.

Next Generation ACO Model

CMS also recently unveiled the Next Generation ACO model, which offers financial arrangements with higher levels of risk and reward than current Medicare initiatives. This model is an attempt to correct perceived shortcomings of the original Pioneer model with refined benchmarking methodology and improved benefit enhancement tools to help ACOs improve engagement with beneficiaries. With offerings including a selection of payment mechanisms to enable a graduation from fee-for-service reimbursements to capitation, the Next Generation ACO model is similarly targeted at seasoned care management organizations. Again, the message from CMS regarding Track 3 and the Next Generation ACO is clear – only the most experienced in care coordination need apply.

CMS is in the process of evaluating further expansion options based on the positive Pioneer results. So what can healthcare providers, hospitals, and health systems take away from these performance results and announcements in the meantime? By now it is unmistakable that CMS is committed to the shift towards population-based models using the current shared savings arrangements as a conduit. Healthcare providers and organizations need to develop a strategy on where and how they enter into the path to value-based payments. The question no longer is if, but when.

Not for the Faint of Heart

Only the most experienced organizations are prepared to try their hand at the lucrative (yet aggressive) Track 3 or the Next Generation ACO; as we saw with the early Pioneer entries, many of those will fail. But there are plenty of other entry points for organizations to dip their toes into the accountable care and value-based payment waters. The most closely aligned initiative of course is through Track 1 of the MSSP, which offers no downside risk to participants through the first three years of the program. Track 1 allows organizations to build the infrastructure necessary to coordinate care and manage a population with little financial risk. Organizations can simultaneously recruit, refine, and strengthen their clinically integrated networks without being on the hook to CMS financially should they endure growing pains and overspend their benchmark expenditure for the year.

CMS has set a target for 50 percent of Medicare payments to be shared savings or population health payment models by 2018. Organizations need to ask themselves if they are putting themselves in the optimal position to survive and thrive as the landscape shifts to these alternative payment models.

Will you have the infrastructure, care management protocols, and network to support the transformative shift to value-based care? Evaluate your market. Are there opportunities to collaborate? What are your competitors doing? Are payers approaching your market with value-based contracts? Now is the time to discuss and strategize how your organization will adapt to the evolving payer environment and whether participating in one of CMS’ Shared Savings Programs can act as the impetus for change to propel your organization to future success.

CMS has made it clear that ACOs and alternative payment models are here to stay. What’s becoming unclear is whether organizations that don’t successfully prepare themselves for that reality will be as well.


Mr. Juberg is a senior consultant with The Camden Group and focuses on clinical integration, transactions, and strategic and business planning for healthcare organizations. He has extensive experience with the development of ACOs (financial planning and funds flow modeling), managing Medicare Shared Savings Program applications, and implementing clinically integrated networks. He is also experienced in master facility planning, CMMI Innovation Center grants, medical group valuations, and community needs projections. He may be reached at djuberg@thecamdengroup.com or 310-320-3990.

Topics: MSSP, Accountable Care Organization, CMS, Pioneer Accountable Care Organization, Next Generation ACO Model, Daniel Juberg

Are You Considering the Medicare Shared Savings Program?

Posted by Matthew Smith on Apr 22, 2015 2:41:00 PM

By Daniel Juberg, Senior Consultant, The Camden Group


With the recent Centers for Medicare and Medicaid Services (“CMS”) announcement of the 2016 Medicare Shared Savings Program (“MSSP”) application cycle, many provider executives find themselves evaluating if the time is right for their organization to apply. CMS allows organizations only one opportunity per year to apply. The May 29, 2015 deadline to submit a non-binding Notice of Intent to Apply is rapidly approaching. Can your organization wait until 2017? Here are some considerations for why the Medicare Shared Savings Program could be the right move for your organization now.

Control Your Competitive Landscape

Take a moment to evaluate your competitors. Who are your competitors and what are they doing? This includes traditional competitors, like hospitals, health systems, and physician groups, as well as other non-conventional competitors who provide ancillary healthcare services, such as pharmacies and retail clinics. Are they forming accountable care organizations (“ACOs”) or similar, value-based organizations? Are they considering or even already participating in the MSSP? If so, their participation could preclude or delay the success of yours in the future. Many executives are using the MSSP as a defensive maneuver to build or protect market share. How? ACOs must have a minimum patient assignment of 5,000 Medicare lives to be eligible to participate in the MSSP. These lives are attributed, predominantly through participating primary care physicians, to the ACO through the group/physician Tax Identification Numbers (“TINs”) that sign participant agreements with them. These TINs can only participate in one ACO in the MSSP. This assignment exclusivity is a defined population play for your organization. Through the MSSP, you can build and/or solidify your primary care base and the patients for whom they care. Even if your competitors are not in the MSSP, this is the opportunity to lead your market, align your physician partners, and solidify your position in the Medicare landscape.

Consider the current payer activity in your market. Are payers currently approaching you or your competitors with value-based, shared savings contracts? Have you considered the infrastructure and care coordination redesign that such arrangements might require? Commercial and government payers are already moving towards value-based payment, so the urgency to transform care delivery models for success in value-based payment models is real. The MSSP can be used as the impetus for change, help you stay ahead of the game, and prepare you for future success under value-based payment.

Prepare for the Triple AimTM

Consider the opportunity to coordinate care and improve quality - with little financial risk. The MSSP allows you to build the infrastructure framework – a coordinated care network that spans the continuum – for the ACO without downside financial risk for the first three years. It provides a simple platform to develop a mutually beneficial, ever-evolving financial funds flow to encourage and support clinical behavior change along the care spectrum. Through the physician-led organizational structure, clinicians are engaged in care model redesign that maintains the patient at the center of their care. Organizational leadership and participants work together to develop quality, patient satisfaction, and performance metrics for transparent reporting and subsequent measurement, which encourages EMR use and physician connectivity and participation. Through this dedication to value-based and coordinated care, all participants are contributing to the achievement of better quality, cost savings, and healthy patients – which will be rewarded with upside incentives in MSSP and commercial ACO initiatives. Gaining this experience with little risk will enable the organization to begin the “rewiring” process to allow participation in other higher risk (and reward) models that may be offered by payers in the future.

Evaluate synergies to better manage care for other target populations. Organizations can also use shared resources developed for the MSSP to incorporate their employee population within the ACO infrastructure to pilot the care coordination efforts and a similar shared savings program. Additionally, some are finding system-wide, cross- payer synergies that benefit their bottom line and keep patients in their care network. For example, some organizations are using their Call Centers or “Hotlines” to not only answer questions about the ACO as required by CMS, but to provide 24/7 physician access, encouraging patients to seek care within their network or sphere of influence while reducing unnecessary emergency department admissions through the use of an urgent care facility.

Evaluate Potential for Profitability Under MSSP

Assess the impact on revenue against your ability to manage costs and achieve efficiencies. ACOs in the MSSP are absolved from downside financial risk for the first three years of the Track 1 program as they work to recruit, refine, and strengthen their clinically integrated networks. But, can you be “profitable” under MSSP? Possibly. In a fee-for-service environment, savings can be generated as a result of the ACO’s cross-continuum care delivery model which streamlines workflow and transitions of care to reduce waste and inefficiencies. This often begins with the reduction of costly acute care hospital-based utilization. Consider, particularly if you are a hospital, how much you can reduce inpatient utilization under the MSSP and whether you can offset the loss of inpatient opportunity with additional patient throughput and capacity across the system. Also, will you be able to grow market share and align MSSP participation with ongoing expense reduction and operational improvement efforts, such as through Lean and Six Sigma? For those with experience in medical management and managed care, you may be particularly well positioned for MSSP. Further, as the federal budget gets squeezed, obtaining any upside in Medicare payment will be important as traditional fee-for- service payments get cut.

Success in the MSSP relies on the ability of an organization to appropriately manage the care, utilization, and cost of a defined population while continually improving quality and clinical outcomes. It also requires full commitment and a clearly defined vision; half-hearted efforts will fail and can be costly both organizationally and financially. Participating in the MSSP will test, facilitate, and/or impel your organization’s path to value-based care. Dipping your toes in the MSSP water may not be the risky proposition - the real risk might lie in not acting now.

MSSP Overview, Medicare Shared Savings Program

jubergMr. Juberg is a senior consultant with The Camden Group and focuses on clinical integration and ACOs (financial planning and funds flow modeling), Medicare Shared Savings Program applications, and strategic planning. He is also experienced in service line assessment and planning, bundled payments, CMS Innovation Center grants, medical staff needs assessments and development plans, as well as bed needs projections. He may be reached at djuberg@thecamdengroup.com or 310-320-3990.

Topics: ACO, MSSP, Medicare Shared Savings Program, MSSP ACO, Daniel Juberg

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