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Wellmark Blue Cross Blue Shield saves $12M with ACO contract

Iowa insurer shares lessons from success

While some accountable care organizations (ACOs) have struggled, Wellmark Blue Cross Blue Shield, of Des Moines, Iowa, has leveraged its ACO to cut healthcare spending and improve quality of care.

The health plan was able to save $12 million in the first two years of its ACO contract, working closely with hospitals, health systems and physician organizations in Iowa, Michael Fay, vice president of health networks for Wellmark, said in a video interview with Hospitals & Health Networks Daily.

Wellmark, the largest insurer in the state of Iowa, put together a proposal built on an ACO shared-savings model in 2011 and began with three organizations, Fay said. By 2015, the ACO has expanded to 13 organizations. One succesful initiative was the ACO's "quality trigger," whereby participants are eligible for financial incentives if their quality score is equal to or better than their past performance.

In addition to cost savings, Fay said Wellmark is even more pleased with improvements in care quality, including double-digit decreases in emergency department visits and hospital admissions.

While skeptics have questioned whether ACOs can create long-term healthcare savings, others have seen success similar to Wellmark. Medicaid ACO programs in Colorado, Oregon and Minnesota have also lowered costs, FierceHealthPayer previously reported. Still, several participants have left the Pioneer ACO program due to financial struggles, including two more late last month.  

Overall, Medicare ACOs saved more than $411 million last year, the Centers for Medicare & Medicaid Services announced in August.

To learn more:
watch the interview

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Next Generation' ACOs: How they differ from Pioneer, MSSP models
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