Aligning accountable care incentives

The health reform law encourages the development of integrated “accountable care organizations” as an alternative to the traditional fee-for-service system. But Humana has had accountable care relationships for more than 25 years. In the first quarter of 2014, we had more than 900 accountable care relationships—that is, relationships with providers who are completely accountable for the costs and care of the Humana population they serve. Under our programs, organizations that operate efficiently and meet quality standards are rewarded for doing so.

Now we are working to bring more of the providers we work with into accountable care relationships. Our experience shows that when providers are given incentives to improve outcomes, quality and costs, then positive results follow:

Accountability leads to better health for Humana Medicare Advantage members

Hospital admissions per 1,000 ↓ 4%
Emergency department visits per 1,000 ↓ 7%
Claims costs (per capita) ↓ 19%

Source: Humana data, 2013

Average rating for traditional fee-for-service providers of care for Humana members Average rating for providers in Humana accountable care relationships
HEDIS star score (a national measure of care) 3.65 / 5 4.25 / 5

Source: Humana data, 2013

Accountability also results in improved clinical management and more patient screenings. For example:

Compliance for cholesterol screenings, eye exams and blood sugar checks for members with diabetes ↑ 7%
Cholesterol screening for cardiovascular care ↑ 5%
Osteoporosis management in women with a fracture ↑ 16%
Colorectal cancer screening ↑ 7%
Adult body mass index assessment ↑ 5%
Medication review for older adults ↑ 8%

Source: Humana data, 2013

Humana’s accountable care continuum

Humana’s goal is to have 75% of our health plan members in value-based, accountable relationships. Our strategy centers on a gradual, multi-step approach we developed to support primary care providers as they move along a continuum of integration and accountability. It is designed to help them transition away from the traditional reimbursement system—where they are paid for every procedure or service they provide, regardless of outcome—to a new system, where they have financial incentives to take on responsibility for cost, quality and patient health outcomes.

Accountable Care Arrow

Fee for service Rewards for meeting national health and quality metrics Rewards for managing population health Full accountability
No accountability for cost or outcome. Primary care provider is paid for each procedure. Example: Provides appropriate preventive and chronic care. Coordinating care across the health care spectrum. Global capitation. Provider gets set payment each month for each health plan member.

Successful national accountable care organization pilot

In Kentucky, Humana teamed up with the Brookings Institution, the Dartmouth Institute for Health Policy & Clinical Practice, and Norton Healthcare in one of five Brookings-Dartmouth pilot programs to develop a national model for accountable care organizations (ACOs). The results after three years show ACOs can help transform the U.S. healthcare system into one that delivers higher quality care while lowering costs. Humana continues its ACO partnership with Norton today.

Year 3 partnership results (2009-2012):
Inpatient admissions per 1,000 ↓ 67%
Inpatient days per 1,000 ↓ 67%
Physician visit within seven days of discharge ↑ 64%

Source: Humana-Norton ACO, 2013

Learn about our accountable care policy here.

What others are saying

Accountable care takes new forms as fee-for-service fades (link opens in new window) 

February 6, 2015

By Health IT Analytics (link opens in new window) 

Some organizations take collaborative care and population health management to new heights.

Summa Health System, Humana forge accountable care agreement

February 5, 2015

By Crain’s Cleveland Business (link opens in new window) 

Summa will coordinate care for Humana’s 55,000 Medicare Advantage members in Northeast Ohio.

Medicare looks to speed up pay for quality instead of volume (link opens in new window) 

January 26, 2015

By NPR (link opens in new window) 

The Obama administration wants half of traditional Medicare spending within four years to be going to providers that coordinate patient care.

Accountable care organizations: like HMOs, but different (link opens in new window) 

January 19, 2015

By The New York Times (link opens in new window) 

New payment models that impose greater responsibility for cost control and quality improvement on providers differ greatly from past models.