Medical Groups Initiating Care Network

As of Friday, February 8, 2013

Pinehurst Surgical Group and Pinehurst Medical Clinic have joined forces to start an accountable care organization (ACO) that they hope will transform delivery of health care in Moore County.

Such organizations are small in number nationwide but growing as the health care industry struggles to rein in costs but improve care.

In accountable care organizations, health providers are rewarded not for higher utilization - more tests, more visits - but instead for how healthy patients remain. The emphasis is on quality and efficiency of care.

"Our current system is not sustainable, so we must change the way we work," said John Rezen, CEO of Pinehurst Surgical. "We can't overemphasize our desire to have everyone join us, because a communitywide effort is required. I would hope the hospital and the physicians in the community would agree that this is the direction we need to be heading.

"It's all about collaboration and working together to develop a better health care system."

Under an ACO, patients still see their own doctors, but wellness visits become more important.

The model gives doctors and hospitals a spending target for patient care and allows them to keep some of the savings if they come in under budget. Eventually, they also will be penalized if they spend too much. The organizations must meet certain health care quality standards.

In theory, with a stake in the finances, health care providers will find ways to avoid needless spending -such as repeated diagnostic tests - and will emphasize wellness over treatment by focusing on preventive care.

David J. Kilarski, CEO of FirstHealth of the Carolinas, lauded the move but did not commit the county's largest employer.

"We are pleased that Pinehurst Medical Clinic and Pinehurst Surgical remain committed to delivering the highest quality patient care at a better value," Kilarski said Thursday. "FirstHealth and the medical community have been on the forefront of responding to the Affordable Care Act with a number of initiatives to continue providing outstanding health care to the population we serve.

"High quality care, cost containment and patient satisfaction are achievable with cooperation and communication among all providers."

The medical practices announced formation of the Pinehurst Accountable Care Network in a half-page advertisement in last Sunday's Pilot, even though they are still developing a budget and addressing key issues such as computer technology.

"We're being transparent," Rezen said. "It's a very new initiative, and there aren't a lot of good examples of proven systems out there. There's a lot of culture change required to make it work."

Jim Faircloth, CEO of Pinehurst Medical, said the initiative is a joint venture.

"We're not merging," Faircloth said. "We've had an informal relationship with Pinehurst Surgical over the years. We agree that we have to adapt to the ever-changing health care landscape. It's challenging, but we're laying the foundation right now."

Added Rezen, "We already share a lot of patients, so it's a natural step for us."

The number of ACOs has increased significantly in recent years and is expected to grow even more quickly in the immediate future, with physician practices like Pinehurst Surgical and Pinehurst Medical under increasing demand to lead or participate in them.

Oliver Wyman Group, a consulting firm based in New York, reported last November that as many as 31 million patients in the U.S., or about 10 percent of the nation's population, are affected by the ACO model in some way.

This Medicare Shared Savings Program is part of the Affordable Care Act, also known as Obamacare, which the U.S. Supreme Court upheld by a 5-4 decision last June.

"We met for the first time last summer after the decision came down," Faircloth said.

Since then, a core group of Faircloth, Rezen and four doctors from each practice have met at least every other week to work over the details.

Rezen called it "a huge undertaking," one that will likely require a seven-figure investment.

"We are in the midst of developing our budget and formalizing our start-up plan," he said. "We want to encourage everyone to join us once we have the infrastructure set up. We really need everyone's participation to make it work."

According to the ad in The Pilot, the ACO will be open to every qualified health care provider and facility in the region "as long as they are committed to quality care, cost containment and patient satisfaction "

"Recent legislation has done little to change the reality that basic health care is growing unaffordable for many ordinary working families and individuals," the ad said. "In such an environment, perpetuating the status quo represents a disastrous choice."

Kilarski noted FirstHealth continues to "invest in systems to better manage and improve the health of our communities " such as the recent introduction of FirstCarolinaCare's Medicare Advantage product.

"We look forward to further engagement with our local physicians on initiatives to ensure we meet our goals of providing the highest quality care at the lowest possible cost," he said.

A report issued last December by the Commonwealth Fund found that investment in technology, particularly population health analytics, is a key success factor in implementing an ACO.

Other aspects of ACO readiness identified by the report include health system collaboration, clinical care integration, risk-based payments and strong leadership.

"This effort has to be physician-led," Rezen said, "and the patient is the focal point."

Any patient who has multiple doctors likely understands many of the frustrations associated with the fragmented, disconnected nature of fee-for-service health care delivery, whether they be lost or unavailable medical charts, duplicated medical procedures, or repeatedly having to share the same information with different doctors.

ACOs are designed to lift this burden from patients, while improving the partnership between patients and doctors in making health care decisions. And patients are not required to participate in an ACO; they can choose a physician outside the ACO.

Studies have shown that better care often costs less, because coordinated care helps to ensure that the patient receives the right care at the right time.

"This initiative is about optimizing patient care. It's transforming from fee-for-service to fee-for-value," Rezen said. "It's an exciting time because this effort has so much potential to change health care for the positive."

Contact Ted M. Natt Jr. at (910) 693-2474 or tnatt@the pilot.com.

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DaveyNC 3 months, 1 week ago

I hope this works but wonder how tempted an organization that is rewarded for how healthy a patient remains will be to screen out all but the healthiest people? Economic incentives are powerful things.

Will be interesting to watch.

Toda 3 months, 1 week ago

Davey one's mind has a tendency to think about the penalties imposed against Rex Hospital et el for fraudulent admissions.

Taxpayers wonder why health costs are soaring ... it's not always the patient. When hospitals charge for non-patient stays, one has to wonder about patient billing as well. First Health isn't exempt to billing charges for services or medications that a patient never sees or receives during proceedures.

DaveyNC 3 months, 1 week ago

Toda, not thinking at all about fraudulent admissions here. I'm wondering how this new organization will police itself as far as accepting all patients as opposed to just the healthiest ones. If they are paid to keep people healthy, it's much easier to do that with someone who is healthy to start with. After all, we don't seek medical help when we are healthy.

22 years old and healthy? You're in. 55 years old and 50 pounds overweight? Sorry, we can't help you.

The law of unintended consequences seems to have a lot of room to play here, as it always does in centrally planned markets as healthcare is now. Maybe someone involved with this can answer my questions here.

Toda 3 months, 1 week ago

Davey I'm thinking in terms of economic incentives as well.

I think we all know Medicare and Medicaid are cash cows for doctors and hospitals. With obesity in our society, I'm sure medical practitioners will have an overwhelming number of patients. Albeit, due to the escalation of health care and NC General Assembly's opposition to Affordable Health Care, those in need of on-going treatment plans, will forgo those visits due to out of pocket costs.

Even those with Insurance Plans, are more and more finding deductibles with 20/80 splits, are more than most household budgets can allocate.

"invest in systems to better manage and improve the health of our communities " such as the recent introduction of FirstCarolinaCare's Medicare Advantage product."

One point of contention is for those who have other Medicare Supplemental insurance have no coverage for access to health improvement facilities. Prior to launching FCC - MA, they would accept Medicare Advantage. Now, they chose not to accept any supplements other than in their own network.

It's all another ruse for the public who can't afford to seek treatment without huge bank accounts, those who are not well, can visit the Moore Free Clinic for continued health care.

DaveyNC 3 months, 1 week ago

If Medicare and Medicaid are such cash cows, why are reports of medical providers considering dropping service to those patients so common? As I understand it, those programs barely pay enough to cover the providers' costs, if that.

If you want to reduce the cost of health insurance and health care, listen to this starting at about the 17 minute mark: http://goo.gl/8QjwW

That's called speaking truth to power right there.

Toda 3 months, 1 week ago

"... medical providers considering dropping service to those patients so common?"

I think (?) some doctors value their services more than others. If a patient comes in with Blue Cross and Blue Shield, and HSA , and perhaps a hefty bank account, the service is greeted with a smile and a bill they know will be paid at the end of the visit.

As opposed to paying up front, before one says "Aw" and then finds that that Aw is $180.00.

I've seen doctors release patients because of having Medicare or Medicaid. The Pinehurst Family Practice began releasing patients about 10 years ago when they merged their practice with First Health.

Some doctors shouldn't be practicing medicine since dead president pictures like Jefferson's and Jackson's have more appeal than treating the ill.

DaveyNC 3 months, 1 week ago

Toda, you're all over the place here. First you call Medicare and Medicaid cash cows for doctors then you go on to note that you've seen doctors release patients because they are on Medicare or Medicaid. Which is it? Why would they drop the cash cow patients? Answer: because they're not the cash cows.

I think a doctor has to make enough on services rendered to cover their rather substantial overhead and make a few bucks. Doctors live pretty well, they always have, and that may even be a primary reason why some go into medicine. They also start their working lives later than most of us and work their tails off when just to become a doctor. I'm okay with them making the big bucks. How much a doctor puts in his pocket doesn't really drive the cost of healthcare. That honor goes to government imposed mandates and regulations as well as the need for doctors these days to practice so-called "defensive medicine."

Get the government out of medicine, return it to a more market-based structure and let's move on.

Toda 3 months, 1 week ago

Speaking in terms of "cash cows", I'm referring to medical equipment storefronts where doctors send patients for assisting products. When the doctors were in private practice, they were concerned about patient treatment, However, when their practice was absorbed by First Health, their concerns focused more on revenues as opposed to treatment of those who could least afford care,

If in fact hospitals don't see Medicaid and Medicare as cash cows, read the fraudulent activities of hospitals charging for care and treatment that is non-existent, Rex Hospital in Raleigh has to repay their milking bill...by several millions,