6 Building Blocks of a Technology Framework for ACOs

Accountable care organizations continue to be a hot topic in healthcare, and with CMS' proposed rule released, many of the "why" and "what" questions regarding the model have largely been answered. However, providers are now beginning to ask what might be the heftiest question of all: how?

How do you create and operate an ACO, particularly in terms of technology? Ken Perez, who directs healthcare performance management provider MedeAnalytics’ healthcare policy team and serves as the company’s senior vice president of marketing, says it is a critical question that is before healthcare providers today.

"Much has been written about the goals, aims and measures of ACOs — and then you have this void," says Mr. Perez. The tone of the proposed rule was non-prescriptive, leaving many providers wondering how to create the ACO infrastructure that is undoubtedly expected of them.

To help fill this void, MedeAnalytics performed a public policy analysis, gathered input from leading providers and payors developing ACOs and conducted extensive market research on ACO technology. What MedeAnalytics uncovered were six necessary components of technology to perform the key functions of an ACO.

"This framework is actually a description of the key building blocks required to establish and operate an ACO. It doesn't mention specific technologies — it specifies and describes the functions and roles technology needs to play," says Mr. Perez.

1. Role-based security. Role-based security is considered the foundation of ACO technology since it helps enable a critical, foundational element: trust between stakeholders. Access to data must be managed carefully to maintain confidence between hospitals, physician practices and payors. "You need to make sure there aren't inadvertent disclosures and that information is shared appropriately," says Mr. Perez. "For instance, if a hospital inadvertently shares all of its cost data with a payor, that would be devastating." When developing a technology framework, hospitals should first ensure controlled access and appropriate sharing to foster trust between the parties involved in the ACO. In addition, role-based security can ensure that access to information is also consistent with the position or role of an individual user.

2. Data aggregation. ACOs require the meaningful collaboration of data between hospitals, payors, physicians and ancillary providers to establish a holistic view of a population's health. However, ACOs may not have natural staffing for the extraction, transformation and loading of data. "Because the organizations within an ACO usually don't talk to one another, there is a need for ETL services," says Mr. Perez. "This concept of an information hub is critical, so a third party is often brought in to provide data aggregation services."

3. Clinical and administrative data exchange. The compilation and sharing of patient-, diagnosis-, condition- and procedure-specific data to aid in patient care is central to ACO success. "If you can exchange such data quickly, it can help provide the necessary care coordination as well as benchmarking and analysis," says Mr. Perez. Another critical aspect of this third step is the sharing of disease registries, particularly those that are top concerns for quality measurements such as congestive heart failure, pneumonia and diabetes.

4. Performance management. This component will make data actionable. Ideally, performance management will include dynamic score cards, dashboards and summary/detail reports. This step will also allow ACO participants to measure themselves on a daily, weekly and monthly basis. "The dangerous thing about an ACO is that the government doesn't get your report until the end of the year," says Mr. Perez. "If you wait until the end of the year, you might be in trouble." Mr. Perez compares performance management to former National Coordinator of HIT David Blumenthal, MD,'s analogy of healthcare as a circulatory system, consistently replenishing itself and refreshing the practice of medicine to make it more efficient. Through daily, weekly and monthly performance management, ACOs can identify problem areas and repair them before year's end.

5. Reporting infrastructure. Reporting infrastructure will allow ACOs to share performance data with stakeholders. Three groups will be interested in an ACO's clinical quality and financial performance: payors, the ACO’s governing body and relevant stakeholders within the ACO. The stakeholders may vary between Medicare and commercial ACOs, but clearly, both will be concerned with clinical and financial outcomes.

6. Financial infrastructure. The last component enables the acceptance, tracking and allocation of payments tied to performance results. "The process for how ACOs will divide payments was not even mentioned in the original legislation (the Patient Protection and Affordable Care Act), but in the proposed rule, providers will have to describe the methodology or rules by which they will allocate shared savings payments in their application to become an ACO that they will submit to CMS," says Mr. Perez. "Of course,  the allocation methodology should be objective and reasonable, so it should be data-driven." This may be the most difficult step of all six components due to its sensitive and complex nature. "Some people have suggested that a third party assist in this matter," says Mr. Perez.

“As with the different elements of buildings, these six technology components are interrelated and synergistic. Each one of them constitutes an essential building block of an effective ACO,” Mr. Perez concluded.

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