Essentia accreditation puts focus on valueDuluth-based Essentia Health is one of the first six health systems in the country to be accredited as an accountable care organization by a nonprofit devoted to improving health care.
By: John Lundy, Duluth News Tribune
Duluth-based Essentia Health is one of the first six health systems in the country to be accredited as an accountable care organization by a nonprofit devoted to improving health care.
The accreditation was announced Wednesday by the National Committee for Quality Assurance.
The term “accountable care organization” might sound like health policy jargon, but it presents a profound change in the way health care is carried out.
“Accountable care organizations are going to be paid based on the value they provide to their patients,” said Terry Hill, executive director of the Duluth-based National Rural Health Resource Center. “That value is going to be calculated by the quality of the care, patient satisfaction scores, the outcomes, etc.”
Accreditation matters because it gives insurers confidence that the health system’s plan meets high standards, said Margaret O’Kane, president of the Washington-based National Committee for Quality Assurance.
“We’ve lived through a period when we had managed-care backlash and so forth,” O’Kane said. “Sometimes it’s because we have organizations that were not doing the right thing.”
Accountable care organizations provide “value-based” service rather than “fee-for-service,” the traditional model.
Under fee-for-service, an insurer would compensate a hospital for the volume of services it provided to patients. Under “value-based” service, the insurer would set targets for maximum spending. If the hospital is able to stay below the target and show that it has provided quality care, it would be paid more, sharing in the insurer’s savings.
In addition to Essentia, the other accredited accountable care organizations are Crystal Run Healthcare in Middletown, N.Y.; the Kelsey Seybold Clinic in Houston; Billings Clinic in Montana; The Children’s Hospital of Philadelphia; and Health Partners in Minneapolis.
“These are organizations that raised their hand right at the start,” said Patricia Barrett, vice president for product management at the National Committee for Quality Assurance, during a Wednesday-morning webinar. “These organizations were willing to say, ‘Yeah, we’re willing to do this, and we’re willing to be transparent for having done it.’ ”
They were the only six among thousands of providers to seek accreditation, said John Smylie, Essentia’s COO. Satisfying NCQA’s standards for accreditation was a rigorous process, he said. But Essentia, which transformed its entire system to the accountable care model in 2010, was all in. The standards NCQA insists on provide a “blueprint for quality” that Essentia wants to achieve, he said.
“When any of our physicians or staff read them, they say, ‘Oh my goodness. This is just really good care. This is how patients should be cared for,’” Smylie said.
Improved outcomes come from helping patients with preventive health, helping patients with chronic diseases manage their care, and providing “coordinated-care teams” for patients with the most complex diseases, Smylie said. The results are fewer hospitalizations and fewer emergency room visits and therefore lower overall costs.
“You lower your cost by improving your quality and doing it right the first time,” he said.
Essentia shares in the savings under agreements with both Medicare and Medicaid, as well as with Health Partners and Blue Cross, Smylie said. Overall, about 60 percent of the half-million patients Essentia serves at 65 sites are covered under accountable care organization agreements, he said.
It’s meaningful for the region that Essentia is one of the first six organizations to be accredited, Hill said.
“I think it’s very significant,” Hill said. “They’re one of the models that the rest of the country is going to be looking at. … I think it’s going to be great for patients.”