Premier expects hospital participation in accountable care organizations to double in 2014, according to its fall 2013 Economic Outlook C-suite survey. Premier’s Economic Outlook highlights emerging economic and industry trends impacting alliance members and the industry.

More than 18 percent of 115 senior executive respondents – primarily CEOs (43.5 percent), chief financial officers and chief operating officers – across 35 states say their hospitals currently participate in an ACO, up from 4.8 percent in spring 2012. This growth is projected to accelerate, with about 50 percent of respondents suggesting their hospitals will participate in an ACO by the end of 2014. Overall, 76.5 percent of respondents say their hospital does or will participate in an ACO.

The pace of adoption has been slower than originally anticipated by senior executives surveyed 18 months ago. Though 51.8 percent of executives predicted in the spring of 2012 that their systems would create or join an ACO by the end of 2013, results show that only 23.5 percent will likely meet that projection.

"The ACO transition is challenging for all providers, and it involves taking significant risks," said Wes Champion, senior vice president, Premier Performance Partners, in a news release. "It’s understandable and appropriate that some providers have been more deliberate and cautious about when they participate in an ACO. And it’s clear that many are now prepared to proceed."

Survey results also suggest:

• Non-rural hospitals are most likely to participate in an ACO overall, followed by hospitals in integrated delivery networks (IDNs).
• Though they’re equally as likely to eventually participate in an ACO, large hospitals are moving more quickly toward participation while small hospitals require additional time.
• Rural hospitals are least likely to participate in an ACO overall, followed by stand-alone hospitals.

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Population health
According to survey results, the majority of health systems are developing partnerships and making investments in the infrastructure necessary to better manage population health.

Among investments:

• Lifestyle and wellness coaching was most often cited overall by 71.6 percent of hospital executives.
• Almost half of rural hospitals use virtual care or telemedicine to connect with patients, compared to 1 in 3 non-rural hospitals.
• Patient-centered medical homes are also popular for non-rural hospitals, large hospitals and hospitals in an IDN.

Respondents cited partnerships with internal physicians and provider leadership most often. Partnerships with large local employers are also popular across all types of providers (51 percent).

"Coordinating care and delivering more efficient care has been a passion at Aurora for years," Richard Klein, executive vice president, Enterprise Business Group, Aurora Health Care in Milwaukee, said in a statement. Aurora Health Care is a 15-hospital system serving more than 1.2 million annually throughout eastern Wisconsin and northern Illinois. "As a self-insured employer, we've been diligently working on this with our own employees for 15 years. Now, we've built an organization that is integrated, highly efficient and is able to produce a better result for the patient," Klein said.

Data, data, data
Access to integrated data with sophisticated population health status measurement is important to ACO formation. According to respondents:

• 72.5 percent are integrating clinical and claims data to better manage population health.
• 50 percent are using predictive analytics to forecast patient/population needs.
• 46.3 percent are using an integrated data solution to reduce silos.

"Within our organization, clinical teams will always serve as the 'backbone' to the challenging work around population health," Michael P. Jeremiah, MD, chair of the Department of Family and Community Medicine at Carilion Clinic in Roanoke, Va., said in a press statement. The clinic cares for nearly 1 million residents across 18 counties in western Virginia through its eight hospitals, primary and specialty physician practices, and other services. "But IT and health analytics provide the 'nervous system' that allow us to fully function and achieve optimal patient experiences and outcomes while controlling cost," Jeremiah added.

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Payer partnerships
Survey respondents are exploring new population health partnerships with private (46.2 percent) and public (40.4 percent) payers. Among these partnerships, upside-only shared savings was the most often cited arrangement (58 percent). In this model, key care management programs are established to manage high-risk and chronically ill populations using claims analytics to predict outcomes. Savings that accrue are split equally between insurers and providers, with no penalties for failure to achieve the goals.

"Providers are building the infrastructure and core capabilities essential to ACO formation, whether or not they’re in an ACO," Champion said. "This implies a new wave of ACO participants will likely emerge in future years as these partnerships mature."