Accountable Care Health Care Public Health STP

ACO – how to guide and considered thoughts

ACO – how to guide and considered thoughts

Ding ding. Round 2
There is increasing discussion of this as a solution to current problems. 
One read of NHS England narrative would be that this is THE direction of travel. It is a policy idea imported from the USA where it is ONE of the three arms of the Affordable Care Act. The notion is basically vertical integration of provision, and alignment of incentives for cost control, quality and outcomes.


This model, or the European variant of it is defo the future. Whole pop, vertical integration (nobody is quite yet sure how to “do” social care – despite the voluminous rhetoric on the matter.

ACOs exist to try to correct a number of fundamental faults in the US Health Care system – for example multiple and perverse incentives in the system, atomisation and fragmentation, and a disconnect between £, quality, processes of care.

There is a great deal of cynicism on whether this is the idea that will achieve quick realizable net financial savings. There is also a view expressed that “the ACO” is a panacea and all about simply organisaitonal form.


Attached are some slides that summarise a broader body of work for YH AHSN (dated winter 2015) setting out what is known about this concept, translated to an NHS audience. I was asked a question by a group of FT chief executives on what the evidence told us and whether this was a journey worth taking. The slides serve here as a primer on what the evidence is telling us and (my take) on some of the key questions. Although these are a year old (the evidence section updated in Oct 16) the fundamentals remain.


Key messages in answer to the question:

1. Should we – yes, what’s plan b. It is not, however, a panacea to quick financial gains. In total the ACO programme across all organisations and contracts is showing a slowing, perhaps halting of growth in cost compared to the background trend. Recent data is reinforcing this message. However, it is not a “home run” in terms of cost control – we should not expect it to be so.

2. What does the evidence say wrt to cost and quality – early signs promising for some, mixed in others. It is too early to definitively tell. The indications are that commercial contracts perform better, physician led contracts perform better than those where there is no physician leaderhip, longer standing ACOs tending to do better, primary care led tending to do better than hospital led, the Blue Cross Blue Shield Alternative Quality Contract is the best developed set of evidence. Many caveats and methodological issues in this evidence set

3. We should NOT over focus on the contract and organizational machinery but that we pay attention to narrative, communication and cultural issues – especially at the frontline. This concept is about considerably more than organizational form, some structural change is needed however. 

4. This is NOT a panacea to quick wins and easy savings. It is an exercise in aligning incentives for population focused care and getting the incentives for cost, quality and outcomes in one place. Don’t think it will solve your problems tomorrow. We should also not over focus on the money. The 5YFV was about 3 gaps. Till we achieve the closing of gap in quality and outcomes we will NEVER achieve the £ gap.


Other considerations and dealbreakers in developing accountable care.

The below Is based on my read of the USA published evidence (not the uk think tanks), on discussions with clinicians (mainly GPs) & commissioners over last 24 months.


Learning from other processes 

There is a great deal that can be learned from LD / Mental Health deinstitutionalization (especially in a local government context, that can be applied to the NHS)


Governance and organisational form

Many stakeholders are fearful of major changes to organisational form. Bringing together currently separate responsible bodies. For example the STP namechecks an Accountable Care System. 

In my view and accountable care “system” will be a step in a journey towards a more integrated form of organisation, rather than an end in itself. However each of the constituent bodies must take a view on this question. How does a Sheffield model of ACO fit with SYB hospital chain model (Vanguard) – who is part of who’s supply chain.

It is worth stating that the STP has no formal standing in governance terms. No expectation that the statutory organisations that underpin the STP will be dissolved in this parliament. The individual organisations are still sovereign. There are signs that individual orgs governance bodies (eg Non Execs of hospitals) outright rejecting STP direction, as it has serious implications for viability of the orgs they are responsible for in regulatory terms.


GP led or hospital led. 

I’m not being drawn. Too divisive. disingenuous and divisive question – if the hospiltal is in scope then it needs to be an equal partnership, eventually seamless. In USA slight edge to GP led models.

interdependency of range of services to deliver outcomes – GP more vulnerable on this

hospital led (good at capital, real estate, lots of other expertise), GPs ( they are far better at managing risk and multimorbid patients.)

Needs mental health

Needs social care

Needs strong financial control over WHOLE system, as a system not bunch if independent orgs.

There’s no real evidence on this way…but read the interesting take of Len Fenwick in the Newcastle paper cited in my slides…..GP is basically an investment to keep people out of my loss making hospital.

Worth saying that most of the body of urgent care literature (esp on integrating H&SC and effective community services points towards doing it around the key hospital provider)
Obviously need to be careful in a hospital led model (especially)

1. Equity of geographical access

2. Outcomes based and not rushed discharge

3. Doesn’t over-medicalise every aspect of care

4. Commissioners still provide O&S

But seems sensible regarding scale, achieving consistency and using those already experienced in making a system flow.
is provider ready to take on risk.

In my view GP and GMS contract has to be in

To do this the key issue is to 1) melt the GMS contract and independent General Practice (obviously won’t go down well), 2) melt the current mechanisms of payment and move to capitation, with two sided risk sharing 3) develop common and consistent quality metrics and benchmarking 4) do big data at scale, with strong focus in population health risk management

Scale and scope

high risk pop vs whole pop, large enough for economies of scale, risk pools (actuarial point).

Is specialised in or not in, ditto social care, ditto GMS contract, ditto DGH and mental health.


Contract form and length

don’t over complicate this – “contracts are limited tools for achieving change” – Nigel Edwards. Data granularity re contract monitoring for WHOLE populaiton (not just user of service x). two sided risk sharing contracts (see Commonwealth Fund paper). Longer contracts preferable, but riskier to payer. Care re micro managing ontracts. Procurement and legal issues in contracting.


Role of commissioner and implications for Purchase provider split.

Legal delegation of responsibility for commissioning. Establishment of this model may have implications re what commissioning responsibilities can be delegated to an integrated provider and what must be maintained by “the commissioner”.

What happens in circumstance where provider wants to close a service / asset strip – who has what responsibility, regulatory issues, equity and inequality issues.

Distribution of resources within a system – and ensuring resource allocation addresses the inequality issue.


Worth reading the Porter stuff on transformation

He wrote a great paper – ‘the strategy that will fix health care’. 


It’s for a USA audience, but general lessons applicable here. 

Point 1 – providers must lead the way……

Makes for uncomfortable conversation about the role of commissioners……which can only be to move away from micromanaging a basically broken system to really place and agenda setting


“We’ve been here before, what will be different this time”; the rhetoric around care closer to home – “nothing happened re how the resource flows in the system”.

We’ve read about Cambridgeshire and its seeming “failure”. Why did it fail, what can we learn, how can we ensure doesn’t happen again (pushed too far, too hard, too fast?).

The narrative of “broken hospitals” is a v powerful and emblematic and very visible thing in the eyes of press and voters. The narrative of “struggling out of hospital care” is rather less visible. Guess how that influences the way the system responds. As David Haslam regularly says “Generla Practice is like a heat sink in a computer. You don’t know it’s there till it’s stuffed, then your system melts”. Can say the same about social care.

Political sign up also important and ignored at our peril. Locally and nationally. 

Death by template vs narrative. Nobody wants to engage with the templates.

STP is a means to an end. The document is not the STP – all the document does is describe a vision and direction of travel.

patients – been consulted? what will it look like for them? what will change for patients

what’s the tipping point at which this becomes the most straightforward option and path of least resistance – (new hospital in spain, earthquake in NZ, ACA in USA)

do we need a change in legislation to make this happen


Cultural issues

Historic lack of trust between different sectors.

In the past (TCS and other) we have egs of providers hovering up “community services” then asset stripping as they shape the world in a way that best suits their interests – how to ensure doesn’t happen again.

The ability of many practices in area xxx GPs to act collectively as commissioner responsible for whole pop, rather than individual businesses.

The question of why would xxxx independent contractors give up their independent contract for join a bigger collective. From their perspective is it THAT broken

Can practices retain independence but still be part of bigger whole

What are the ingredients of independence

What’s the tipping point at which this becomes the only option and path of least resistance

Are there alternatives to ACO – are “Alliance, MCP, PACs, mutual joint venture a stepping stone or an end in itself”.



Communication and culture at the frontline

“You can talk about it in the audit committee all you want, but until you’ve got the data to engage clinicians on quality and outcomes, on overuse (waste and harm) and underuse (failure to prevent)

The STP per se, or any other planning process, gives no authority to change. The authority to change public services comes from the people who pay for them and the people who work in them delivering the service. Engagement critical.


ACO is about far more than organisational form.

Don’t infatuate with just the question about form….focus on the culture and communication, especially at the frontline. Don’t wait for org structures to be perfect. Create the vision and get on with. Don’t focus in structures – focus on outcomes, 50 yrs ago there are patients with asthma, in 50 years time there will be patients with asthma. What matters is the most efficient means to get to the outcome.


Payment mechanisms

PBR is a deal breaker. Local decisions re alternative payment models are acceptable to NHSE leadership. Has to have agreement of all stakeholders, including hospitals. Thus need to understand the economics of the hospital to see when the tipping point is reached. We can move away from PBR if we want, PBR is the national default but NHSE are happy to discuss alternatives.


timescale and process

what are the checkpoints – how will we know we are doing well, or not – especially in some of the cultural aspects and movement towards whole pop capitation methods.

What are the tests of fitness for purpose for both the payer and provider side of this venture













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