Why one commercial payer invested heavily in ACO development

The first step is probably the hardest. In order for payors and providers to effectively manage an accountable care initiative, trust has to be built. Trust for the exchange of information and the vision of what quality measures will be enacted. Trust for objective evaluation of physicians and hospitals that are providing the care and trust for the payors overseeing a patient’s overall health plan. In the past it may have seemed like a daunting task, but if recent developments in accountable care with Blue Shield of California and area providers are any indication, payors and providers are increasingly finding successful working structures to improve healthcare delivery.

Blue Shield of California is an independent member of the Blue Cross Blue Shield Association, a not-for-profit health plan with 3.3 million members, 4,800 employees, and one of the largest provider networks in California. Founded in 1939 and headquartered in San Francisco, Blue Shield of California offers a wide range of commercial and government products throughout the state. It’s also already engaged in a number of accountable care initiatives with physician groups, hospitals and health systems, with big plans in the future. ACO Insights interviewed Kristen Miranda, vice president for provider network management, Blue Shield of California.

ACO Insights: Why does an accountable care strategy for Blue Shield of California make sense?

Kristen Miranda: Consistent with our not-for-profit mission to provide access to high-quality health care at an affordable price, we are collaborating with providers to launch ACOs aimed at controlling costs while offering optimal patient care. By 2015, Blue Shield plans to have 20 ACOs throughout California.

This strategy makes sense because the problem of healthcare affordability is so acute right now. The growth trajectory for healthcare costs is unsustainable. Making health care affordable is a critical national priority, and we’re doing our part to reduce the rate of growth in medical spending.

ACO Insights: What may have been an obstacle to this kind of coordinated care in the past between insurers and providers?

Miranda: The biggest obstacle has been the lack of trust. Showing providers that we’re interested in integration and sharing risk, not shifting risk, has helped build mutual trust and a greater degree of transparency.

ACO Insights: Of the ACOs developed or underway, what are some of the common challenges? What about the unique challenges to each of those ACOs?

Miranda: Aligning the cultures and processes of multiple large organizations to achieve a common goal is always a hurdle, but we’ve shown that it’s possible if we stay focused.

The unique challenge for each ACO is to understand the health profile of the population that the collaboration will serve, develop initiatives designed to improve health outcomes and reduce costs for that population, put in place process and technology solutions to facilitate the timely exchange of clinical and case management data, and to execute in a coordinated way.

ACO Insights: Has Blue Shield received any feedback from customers/patients?

Miranda: We have an ACO with Catholic Healthcare West and Hill Physicians Medical Group in the Sacramento area serving more than 40,000 CalPERS members. In 2010, the first year of that collaboration, we achieved $15.5 million in savings as well as significant reductions in inpatient readmissions, average patient length of stay, and total days patients spend in a facility. Based on that success, the collaboration continues to this day.

To read the full interview and more on Blue Shield’s ACO initiative, click here