By Josh Gray and Maria Monahan
Many major hospital and health systems have launched Accountable Care Organizations (ACOs) through Medicare’s Shared Savings Programs (MSSP). Leakage – patients receiving care from competing hospitals or specialists – can be a substantial challenge for health system-affiliated ACOs. Out-of-network visits limit an ACO’s visibility, making both cost control and care coordination more difficult. Health systems also suffer from lost revenues for services that could have been performed in house.
Over the last six months, we have analyzed leakage patterns for half a dozen ACOs affiliated with academic medical centers or hospital-based health systems. We’ve focused on hospital-based outpatient services, since these services tend to have relatively high margins.
The examples we have analyzed have very high leakage rates. In nearly every case, outmigration for hospital outpatient services exceeded 20%, and we have found at least case where outmigration exceeded 50%. The dollar impact was enormous, exceeding $140 million for two of the ACOs.
What can ACOs do about this problem?
- Use analytics to flag high-leakage PCPs
- Discuss root causes with those clinicians
- Address access/service gaps
- Communicate benefits of “in-network first” utilization
- Deploy care managers strategically
Most health systems are currently grappling with intense financial pressures and uncertainty over the future. While reducing ACO leakage is not easy, relative to other approaches, it is an attractive strategy for preserving health system margins.
Need a quick ACO Leakage diagnostic? Let’s talk.
Josh Gray, VP of Analytic Services, HDAI ([email protected])
Maria Monahan, Data Analyst, HDAI ([email protected])
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