Part 3: Making money moves – Powerful contracts and negotiating positions for CINs and ACOs

All successful Clinically Integrated Networks (CINs) and Accountable Care Organizations (ACOs) share one important focus: Contracts with payers.

Since the inception of CINs and ACOs, this has been one of the most important measures of success. A key dependency is communicating the contract terms to providers so clearly, they can see its impact to their day and pay. Article 2 of this 3-part series, outlines communication of contract terms and term performance to stakeholders as one of the keys to provider engagement and lays the foundation for the final topic of this series.

Talking to Providers About Contract Terms
Terms must be communicated. Seems obvious, however, to do that CINs must be able to not only understand but knock out of the park a few key aspects:

1. What the contract requires
2. Insights into the patient populations included in the contract
3. The ability to monitor performance specific to each individual contract

Knocking It Out of the Park with Multiple and Diverse Contracts
Hopefully your CIN/ACO is knocking it out of the park. But most in the industry are struggling to do so. So, here are a couple of important things to add with your number and range of contracts:

• Have multiple, diverse contracts caring for various populations
• Include multi-specialty provider networks

While the success of holding multiple contracts is the goal, there are operational, clinical, and process challenges that arise with actually performing to contract terms. Most importantly, the stakeholders need to understand the type of contract and the terms/requirements to succeed.

Types of Contracts: A Review
Let’s review the types of contracts typically included in CIN/ACOs. Each of these contracts are focused on improving the quality while decreasing the cost of care for the populations served. In many cases young CIN/ACOs will allow providers to maintain their baseline fee for service contracted rate and then add other pay for performance terms to the population contract.

P4P: A very straight forward Pay for Performance contract would be to incentivize providers for achieving improvements or meeting goals for strategically selected metrics, typically from MACRA, for CMS programs, and or HEDIS for Medicare Advantage and commercial payer programs.
Shared Savings: Shared savings contracts are built around a population. Goals for quality, efficiency and financial savings are based on a baseline of analyzed historical data. Keep in mind that shared savings contracts may have a care coordination expectation for the CIN/ACO/provider organization.
Bundled Payments: As we move into bundled payments, they may be disease focused or procedure based, the contract will be based on historical cost and outcome data on that population. Incentives are achieved by controlling cost and care managing the disease/procedure to quality gates and financial allowances.
Quality Gate: Just in case the phrase “quality gate” is new to you, it is a make or break for CIN/ACOs and their providers. A contract quality gate serves as the entry to contract incentives. A contract may have several quality measures in the quality gate and a certain percentage improvement or a metric goal must be met to be eligible for the incentives. Incentives can range from quality bonuses, care coordination fees, and shared savings funds.
Risk Bearing Agreements: As a CINs/ACO’s infrastructure, operations and experience matures, contracts focused on service line performance and risk-bearing agreements – from partial upside and downside risk to full capitation – making the use of clinical data, including adjudicated claims, imperative to success.

A Nurse’s Perspective on Contracts
As a nurse, it is always important to me to look for how the patient is affected and or benefited by our efforts to adjust to new payment methods and improve as an industry. I realize this tie to the point of care is still somewhat of a reach in some cases, however, the quest to provide the right care to the right patient at the right time is worthy of our continued effort.

As stated in the first article, physicians do not think that the measures in regulatory programs are indicative of high or low quality. When we apply our efforts, through contract terms, to specific populations the ability to measure improvements of efficiency, cost, access and patient outcomes increases.

Care Requires Money and Time – Link Contracts to Provider’s Day and Pay
The efforts to right our US health care industry still costs money and requires a significant lift from providers across the continuum of care. So how does the contract management for CIN/ACO benefit the stakeholders. All providers want to know what is going to happen to my day and my pay. First, before there are contracts, care coordination fees, bonuses, quality gates, and or baseline shared savings are established, your organization should plan and develop the distribution methodology. A Managed Care and Finance Committee has a much clearer vision without money sitting on the table.

The best contract distribution models consider ownership and investment organizations, providers that carry the bulk of the labor and process changes to their daily practice or (what has happened to their day and their pay), panel sizes, as well as a quality gate for individual providers to ensure that every provider is actively participating in the program and working towards the success of the CIN/ACO contracts.
Ultimately these actions are driving us all toward improving quality and decreasing the cost of that care.

Ronda Hefton, RN, BSN, MBA, is an integrated care consultant and guest contributor for CitiusTech. 

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