4 Accountable Care Models for Rural Providers

Getting into accountable care is a challenge for any provider organization, but especially so for small, rural hospitals and physician groups. Many smaller organizations don't have as much access to capital as their urban counterparts, for instance, and are therefore hard-pressed from a technology and infrastructure basis.

Even though it is more difficult for rural providers to get in the accountable care game, many providers are still interested, says Carole Cusack, vice president of consulting and analytics for Treo Solutions. Because of the inherent difficulties rural providers face in this area, Treo Solutions and Ms. Cusack have developed four accountable care models specifically for small and rural providers.

The models, detailed below and also in the report, "Building Effective Models of Accountable Care: Solving the Urban Conundrum and the Rural Challenge," can consist of partnerships involving local providers or local providers and a payer.

1. Build a system hub. "We find that folks who live in rural areas will bypass the rural hospital and drive…to a metro area to receive care," Ms. Cusack says. This can happen because of the perception that care is better in the city or the patients may believe the services they want are not locally available. "That's not necessarily true," Ms. Cusack explained, citing examples where 70 percent of care that leaks to the metro area could stay local instead.

There are two main ways to build a system hub, Ms. Cusack explains. Under one model, a large organization will form affiliations with smaller, more rural providers. Then, the larger organization routinely sends providers to the smaller hospital's campus to provide high-cost or specialty services. For example, North Mississippi Medical Center in Tupelo sends providers into rural areas to provide care.

The other model is for smaller organizations to affiliate with a larger system hub, and have the smaller organizations in the community transport care to the larger location. Dartmouth Hitchcock Medical Center in Lebanon does this through its Center for Rural Emergency Services and Trauma program, where it connects patients from rural communities to its main campus. This helps prevent patient leakage to a larger metro area like Boston.

Keeping services local is a good first step for rural providers looking to move toward accountable care. For instance, it allows those organizations to maintain a large enough patient base to stay afloat. The model also helps avoid unnecessary duplication of services. "Rural facilities…still need to think about the future and how they factor into the total cost of care," Ms. Cusack says. Avoiding service duplication "allows them to naturally lower the total cost of care."

2. Facilitate a regional ACO. Providers can bond together; form a new legal entity and then contract with payers for shared savings, or another risk-baring model, based on shared metrics. This allows small or rural provider organizations who are not large or integrated enough to form their own ACO to work together. Some providers in Maryland have done this and formed a Medicare Shared Savings ACO, according to Ms. Cusack.

This model can be challenging for small or rural providers and has not been extremely popular with providers yet, Ms. Cusack says.

3. Create an ACO-type construct. This model is what Ms. Cusack calls a "virtual" ACO. It is very similar to the second model, but it does not have an overarching and binding legal structure. The providers work together with a payer "for the purposes of managing quality and total cost of care," she says, but do not contract with the payer as a group. Instead, contracts are decided independently between the payer and each organization.

4. Establish a regional patient-centered medical home. Since rural medical offices can be as small as one or two physicians, they often have small patient pools. That makes it difficult to build a patient base large enough for payers to measure metrics upon. To overcome this, groups of primary care physicians can bind together and put patients in the same pool. Combining the patient populations makes the patient pool large enough to allow for combined measurement from a payer, Ms. Cusack explains.

When rural providers have options to pursue accountable care, like the four options above, they do not have to consolidate with a larger provider to practice accountable care. "Part of the reason we're doing this is that we're trying to avoid market consolidation," Ms. Cusack says. "We want to keep rural facilities as slim as possible but still individually viable."

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