Accountable Care Organizations (ACO) represent a growing opportunity for palliative care companies, and providers have a number of ways to get in on the ground floor.
Along with Medicare Advantage, ACOs are one of the few avenues towards more robust reimbursement than fee-for-service models. Operators can come to ACOs by two main avenues. For one, they can become members of those organizations themselves, or they can contract with them through a preferred provider network.
This may be increasingly important to explore as the U.S. Centers for Medicare & Medicaid Services (CMS) has announced plans to ensure that 100% of Medicare beneficiaries become aligned with an accountable care entity.
“When we think about the value-based world, there’s a lot of value to be delivered that maybe is not captured in the fee-for-service world,” Dr. Thomas Lee, vice president of medical affairs for Ennoble Care, told Hospice News. “The ACO gives us the flexibility to provide that team-based approach and show that it’s cost effective to do these things.”
There’s a lot of value to be delivered that maybe is not captured in the fee-for-service world. The ACO gives us the flexibility to provide that team-based approach and show that it’s cost effective.”-Dr. Thomas Lee, vice president, medical affairs, Ennoble Care
Ennoble Care is a multi-state home health, hospice and palliative care provider headquartered in New Jersey. The company not only operates its own ACO, but also has become a member of the managed services organization (MSO) Empassion Health, which launched in early 2022.
Empassion operates multiple high-needs ACOs that largely operate within the ACO Realizing Equity, Access and Community Health (ACO REACH) model. Its members are almost entirely home-based care providers.
The organization’s Complete Care Academy ACO boasts more than 200 organization members. It also operates three regional ACOs in the Midwest, the Northeast and the South.
CMS launched ACO REACH on Jan. 1, replacing the Global and Professional Direct Contracting (GPDC) models. CMS has said that ACO REACH reflects its redesigned strategy for payment system demonstrations, in which advancing health equity is a key tenet.
Empassion is already one of the largest value-based palliative care networks in the country, Terri Maxwell, the organization’s chief clinical officer, said during the Hospice News Palliative Care Executive Webinar Series. Thus far, the MSO includes providers in 25 states with plans for continued expansion.
While Empassion’s members provide a range of home-based services — including primary care, home health and hospice, among others — building a palliative care network was always a key goal, according to Maxwell.
“Everyone knows that community-based palliative care can be really helpful, but it has been a loss leader. That’s not sustainable when you think about the growing number of baby boomers who are aging and the growing need for the services,” Maxwell told Hospice News. “So we’re really hoping that this is going to make it a lot more sustainable and financially viable.”
“Everyone knows that community-based palliative care can be really helpful, but it has been a loss leader. That’s not sustainable.-Terri Maxwell, chief clinical officer, Empassion Health
Empassion was founded by the New York-based startup incubator Oxeon Venture Studio, which focuses on developing health care companies. Accion helps launch providers by developing a concept and bringing together investors and an executive team.
For Empassion, investors included Bayada Home Care, Town Hall Investors, Oxeon and the venture captial firm 8VC. The company also has partnerships with the National Hospice and Palliative Care Organization (NHPCO), the Coalition to Transform Advanced Care (C-TAC) and the American Academy of Home Care Medicine.
“There was interest for many years in the serious illness care space, but I think [Accion] was trying to find the right mechanism for it, something that was really, truly unique. When CMS came out with the ACO REACH high-needs program, they realized it was the one of the first opportunities for true value-based care within the serious illness care model,” Maxwell said. ”They felt that there would be a need for an enabler to help bring together the networks and the provider groups in order to successfully transition from fee-for-service to value-based care and all the administrative, regulatory and financial pieces that go with it.”
To build the network, Empassion employed a small team to comb through the marketplace for home-based care operators that had a large Medicare fee-for-service population, as well as palliative care providers.
The process required a great deal of education for those providers on the ACO REACH models and the potential benefits of working with an ACO, Maxwell said.
Providers that have joined ACOs are able to participate in ACO REACH directly. Providers can also develop preferred provider relationships with ACOs. The two parties can negotiate mutually beneficial terms that are customized to the needs and characteristics of their patient population. This practice began with the direct contracting models and will continue in the new program.
These contracts can involve shared-savings arrangements in which providers can receive a portion of the dollar amount of any health care cost reductions.
These arrangements have paid off for CMS. The agency reported this week that its Medicare Shared Savings Program (MSSP) reduced spending by $1.8 billion in 2022, making it the sixth consecutive year the program has generated significant savings.
Currently, shared savings program ACOs include close to 575,000 participating clinicians who provide care to nearly 11 million Medicare beneficiaries, according to CMS.
While not all ACOs are focused on the home setting, many recognize the value of community-based palliative care.
Case in point, the Delaware Valley ACO has collaborated with its partner Main Line Health to develop a comprehensive, community-based palliative care program that went on to reduce costs of care by $9,000 per eligible patient, according to Beth Souder, the ACO’s vice president of clinical operations.
Despite operating its own ACO, Ennoble Care decided to sign on with Empassion largely because it saw a gap when it comes to reimbursement for the high-needs population.
“[Empassion] was in line with what we wanted to do. Ennoble as a company really is the full outpatient continuum of primary care in the home, palliative care and hospice. it had to do with that high-needs component because our own ACO REACH program is not part of that high-needs track,” Lee said. “Because of our population, we thought working with Empassion would be great.”