Creating and Measuring ACO Success

What makes a difference in setting up an accountable care organization? Granted, every ACO will be unique based on its location and the population it serves. But when an ACO achieves marked success in its very first years, that’s reason to stop and observe why.

Richmond University Medical Center has that kind of ACO. Formed in 2014, the Richmond Quality ACO has a record that surely any hospital-sponsored ACO would want to replicate. This chart offers a statistical snapshot of its initial three years of success. Of particular note, Richmond Quality ACO nearly doubled its shared savings in the second year. It also earned the highest quality score of only five successful New York ACOs that same year.

Richmond University Medical Center

Staten Island, New York

450+ bed acute care hospital 1 of 2 hospitals in the NYC borough of Staten Island Local population of about half a million people
Richmond Quality ACO established 2014

Measures of Success

Year Total Shared Savings Quality Score
(33 benchmarks)
2015 $3.7 million 100% 1 of only 6 New York ACOs to achieved shared savings
2016 $7.4 million 95.5% – 1 of only 5 New York ACOs to achieved shared savings

– Highest quality score of the 5 successful New York ACOs

2017 $7.2 million (estimated minimum) Over 90% (estimated) – Fall screenings up 53%
– Clinical depression screenings up 30.4%
– Flu immunizations up 18.2%

Three Strategies to Follow

RUMC executives paid particular attention to three areas in creating the ACO. Consider how their priorities align with those in your healthcare organization.

1. Garner Physician Loyalty

RUMC worked to recruit primary care physicians with sufficient Medicare patients to meet the requirements for forming the ACO under the Medicare Shared Savings Program. Beyond that, RUMC also recognized the importance of sustaining that physician base and creating an engaged group that would maintain loyalty to the ACO. Incentives, including acquisition of practices, helped develop or cement relationships. Also significant was an established history of mutual respect between the hospital and medical staff.

2. Put the How-to in Writing

Communication and education were priorities from the start. An ACO-experienced consultant produced a provider manual with key information for physicians and their office associates. Content included the physician contract; required signage for patient waiting areas; answers to patient questions about the ACO; Centers for Medicare & Medicaid Services quality performance standards; and an opt-out form for patients choosing not to share their data with the ACO program. In addition, in-person meetings with participating physicians kept communication lines open and education ongoing.

3. Get the Board Structure Right

In forming the ACO board of trustees, RUMC’s vice president of quality took the lead as board chair. Two committees, finance and performance improvement, provided a solid board structure. Frequent board sessions and contact, including with the physician group, were hallmarks of the board’s activity as the ACO took shape. The board also made ongoing review for effectiveness of decisions and policies a part of its process.

Moving Forward: “Pathways to Success”

The outcome, as Richmond Quality’s measures of success demonstrate, was an ACO off to a winning start. However, like all ACOs, it faces frequent new guidelines. One major set came with the release of the “ACO Pathways to Success” final ruling from the Centers for Medicare & Medicaid Services (CMS), in December 2018.

“CMS’ overall goal is clear and unchanged from the proposed rule: to put the ‘accountability’ back in accountable care by moving ACOs more quickly to downside risk,” explains John M. Harris, ACHE faculty member and Director of Veralon, a healthcare management consulting firm. “While the final [CMS] rule tracks the proposed rule issued in August fairly closely, CMS has ‘softened’ some important areas and, notably, is further encouraging program participation by physician-led ACOs.” Get more “Pathways” analysis from Harris and Veralon associate, Amanda Brown, in this report.

To learn more about Richmond University Medical Center’s inspiring path to its early ACO success, read “Achieving ACO Savings: A Case Study,” in ACHE’s Healthcare Executive Magazine. Four senior RUMC executives share their pivotal decision-making.

Congress Watch Box

Watch here for related sessions coming up at the
ACHE Congress on Healthcare Leadership, March 4-7, 2019.

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