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Illinois Health Partners named Medicare ACO.


Medicare taps DuPage-Edward venture to manage patients, find savings
By Kristen Schorsch
December 26, 2013

The federal government has tapped an organization backed by DuPage Medical Group Ltd. and Edward Hospital & Health Services to manage the health of about 50,000 Medicare beneficiaries under an arrangement designed to create incentives to cut costs.

The DuPage Medical-Edward venture is one of five groups serving Illinois residents chosen Dec. 23 to form so-called accountable care organizations, which are intended to lower costs through efforts such as eliminating duplicate tests and keeping patients away from pricey hospital stays.

The latest round of ACO selections also includes Ingalls Health System in the south suburbs and a physicians group led by Dr. Naser Rustom, who is better known as the owner of the lavish Alhambra Palace restaurant in the West Loop.

The DuPage Medical-Edward venture is a subsidiary of Illinois Health Partners, a network formed by the physicians group and Naperville-based hospital in 2011 that manages more than 100,000 patients insured by Blue Cross & Blue Shield of Illinois and Humana Inc.

In the fragmented health care system, patients can often see multiple doctors, each with their own set of records and sometimes differing views on appropriate care.

The ACOs, created under the Affordable Care Act in 2010, aim to better coordinate patient care while encouraging providers to lower health care costs by allowing them to share in savings.

Patients in a Medicare ACO can go elsewhere for care, yet their ACOs are financially responsible for services provided and could face consequences of bad outcomes, a possible flaw in the ACO structure.

“While there's tremendous opportunity in really delivering better health care, higher-quality, lower-cost health care, there's not an impetus on the part of the consumer in many cases to really participate,” said Steve Lefar, CEO of Skokie-based health care analytics and consultancy Sg2 LLC.

Illinois Health Partners ACO LLC is one of 123 new ACOs nationwide month by the Centers for Medicare and Medicaid. Illinois Health Partners' experience and existing infrastructure, such as a common electronic health record, give the new ACO an advantage, said Mike Kasper, CEO of Downers Grove-based DuPage Medical, one of the largest physicians groups in the Chicago area with $415 million in 2012 net revenue.

“We think we're uniquely positioned,” Mr. Kasper said.

He added that the shared savings model isn't as financially risky as another Medicare model, the Pioneer ACO. In July, CMS said just 13 of 32 Pioneer ACOs generated shared savings with the federal agency. But collectively those ACOs saved nearly $33 million by lowering health care expenses in part by reducing hospital admissions and readmissions. Yet nine health care providers reportedly planned to drop out of the Pioneer program, raising questions about the attractiveness of the initiative to doctors and hospitals.

In Harvey, the Ingalls ACO is only taking on about 6,100 Medicare beneficiaries as the hospital seeks to adapt to an environment in which hospitals are being rewarded for quality over quantity of services provided. “Health care is changing, and it really is moving toward population health management, what ACOs do,” said Lynn Philipson, executive director of the ACO, Ingalls Care Network LLC, as well as director of managed care for Ingalls Health System, which had $355 million in 2012 revenue.

“So we felt that we wanted to get more into developing population health management here at Ingalls, and having a specific population to start with is very helpful when you're building those systems and competencies.”

More than half of the new ACOs are physician-led organizations that serve fewer than 10,000 beneficiaries, CMS said in a news release.

Dr. Rustom, a south suburban internist, is leading Primary Comprehensive Care ACO LLC, a consortium of independent physicians whom he recruited. The ACO would manage about 5,600 Medicare beneficiaries, said Gary Albers, chief operating officer of Louisville, Ky.-based Imperium Health Management LLC, which manages the venture.

“Part of what is very important to the inner workings of an ACO is to move patients away from the expensive side of services and into the outpatient setting,” Mr. Albers said. “So it fit hand-in-hand with what Dr. Rustom has done historically.”

In October, the Illinois board that regulates health care projects approved a plan by Dr. Rustom to open an outpatient surgery center in south suburban Orland Park. Dr. Rustom initially said the facility would be the first outpatient surgery center in the state to follow Islamic law but later amended his proposal to drop religious references. He did not return a call to comment.

More than 360 Medicare ACOs have launched nationwide since the program began in 2012, covering more than 5.3 million people nationwide. The groups must meet 33 quality measures related to care coordination and patient safety, among others metrics, and share with Medicare any savings achieved from cutting health care costs by meeting those standards.

Janesville, Wis.-based Mercy Health System ACO plans to serve beneficiaries in Illinois and Wisconsin, while St. Louis-based SSM ACO LLC plans to serve those in Illinois and Missouri.

Learn more about Illinois Health Partners.


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