Highmark Execs Detail ACO Transformation

Highmark, the Pennsylvania-
based integrated healthcare network, seeks to use ACOs and primary care medical homes to transform the way it does business.

One of the biggest Blue Cross Blue Shield carriers in the country says it is pushing the accountable care organization envelope.

Highmark Inc. has offered BCBS health plans for more than 75 years. A year ago, the Pittsburgh-based payer acquired the seven-hospital Allegheny Health Network, which helped make Highmark the third-largest integrated delivery network in the country.

Now the 5.2 million-member insurer with operations in Delaware, West Virginia, and Western Pennsylvania is banking on the ACO model to drive down costs in the seven-hospital network and spur development of a sprawling integrated healthcare delivery system.

In a phone interview last week, a pair of Highmark executives described the company's quest to transform the way the Blues does business. "We're trying to change our primary care model," said Mark Piasio MD, MBA, medical director at Highmark.

Deborah Donovan, director of provider performance and innovation at Highmark, said merging payer and provider offers valuable opportunities for the partners to leverage each other's skills and resources.

"Payers have incredibly rich data sets that we haven't shared with providers; we haven't really needed to because of the focus on care [to the exclusion of cost in the fee-for-service system]," she said. "The holy grail is when we can link the rich claims data with the clinical data the providers have."

Piasio, who practiced as a physician for 25 years, says he "never really understood the incredible complexity of what an insurer has to do. We still have a ways to go [toward] sharing data."

After finalizing the financial framework of its payer-provider partnership in the first months after the Allegheny acquisition, Highmark turned to "the loftier goals" of an ACO transformation, with primary care medical homes driving the process, Piasio said.

"It's interesting serving two masters, being both payer and provider," he said of the effort required to get the health plans and their providers working toward shared goals of lowering costs while raising efficiency and quality standards. "This is not a two-week project. This is a journey."

Bring in the Clinical Transformation Consultants
Donovan says Highmark's medical homes follow established regional and national models that focus on clinical quality and cost of care. Two key elements of the company's ACO genesis are a staff of "clinical transformation consultants" who are helping physicians retool their practices and the establishment of gain-sharing programs with physicians.

"We are partnering with our providers and helping them transform… "[The clinical transformation consultants] work in the areas the practices need," Donovan said of the 30-member specialized consultant staff. "That's a major commitment on the part of the health plan."

Highmark is in negotiations with several physician practices to establish gain-sharing programs, she said, noting that "high volumes" of patients are required to optimize the benefits for both payer and provider.

"It's a good tool to use," Piasio said of gain-sharing programs. "We're exploring them everywhere they make sense."

He believes medical homes are particularly effective in helping patients manage chronic illness in a way that improves quality of life and contains costs. "They need a great deal of coordination to make sure one condition is not affecting another," Piasio said of chronic illness patients.

"How we deliver primary care and how specialists view the world will be totally different than we have today. Otherwise, we will be just kicking the can down the road."

In addition to the clinical transformation consultants, Highmark is providing financial support to help physicians invest in the changes needed adopt the medical home model and operate within the new integrated delivery system.

Highmark has provided funding for electronic health record upgrades and developed "detailed analytics" to share with physicians to help them understand more about the medical needs of their patient populations. "We're providing that on our dime. We are fully supporting them on all fronts," Piasio said.

Early Results
About 850,000 Highmark health plan members are receiving medical services through 3,500 physicians at primary care medical homes. "It's a significant footprint," he said, adding the early results are promising. The payer has documented an uptick in "gradable quality scores" among practices that were already participating in quality programs," Piasio said.

And Highmark's medical homes are starting to pay off on the cost side. "For the most part, relative to the market, they are outperforming those who are outside the system. Our costs are trending below the market," he said.

Donovan said the startup phase of Highmark's ACO drive will take several years. "We're looking at this being a three-to-five year assessment," she said. Piasio believes sustaining and growing ACOs and other value-based healthcare delivery systems will take much longer.

"This isn't easy. There are a great many complex parts that go into how Americans get and pay for healthcare. If it got changed in a generation, that would probably be good," he said. "It's a huge endeavor, but what we're seeing early on is there is uptake… At least the train has started moving."