Marriage Material: Independent Practices Find Success in Commitment to Accountable Care Organizations
By Joey Berlin Texas Medicine December 2018


Call it wedded bliss.

David Sprouse, MD, of Family Practice Associates in Kerrville, likens the formation of his accountable care organization, Alliance ACO, to a marriage. TMA PracticeEdge, the Texas Medical Association’s vehicle for banding practices together into ACOs, was the matchmaker that set it all up. (See “Joining TMA PracticeEdge,” page 18.)

ACOs are groups of practices that join together to pool their resources, improve patient care, and collectively aim for the sometimes daunting targets in value-based payment programs.

When TMA introduced Alliance ACO to Hill Country ACO back in 2015, it was the start of something special. Those organizations combined to form what is now called Alliance, a partnership that in 2017 saved more than $6 million in patient care costs participating in the Centers for Medicare & Medicaid Services’ (CMS’) Medicare Shared Savings Program (MSSP). In a shared-savings arrangement, a payer incentivizes practitioners to reduce spending by offering them a percentage of any savings they generate.

To be sure, there are differences between forming an ACO and an actual marriage. For example, there might not be a “honeymoon period” at all. In its first year following the merger, Alliance didn’t achieve any shared savings. So first, you may take your lumps — but do it right, and there’s a chance you’ll save in chunks.

“There’s a steep learning curve, and I think our learning curve was … probably one year of steep, one year of less steep, but always ongoing,” Dr. Sprouse said. “If practices or doctors are willing to commit the time and energy and effort to learn what needs to be done, and [number] two, do it, and [number] three, be sure that all of their cohort colleague doctors are doing what needs to be done,” and help out those colleagues, they can make an ACO work.

At a time when the independent practice of medicine is under siege, Alliance and other ACOs in Texas are generating results today and providing hope for the future. 

Harlingen family physician Sheila Magoon, MD, says ACOs are an opportunity for physicians to spearhead an organic, ground-up movement for health care reform, versus top-down reforms from the state or federal government. Dr. Magoon is part of Buena Vida y Salud, an MSSP ACO that also is part of Osler Medical Group ACO, a TMA PracticeEdge-managed collection of ACOs participating in a shared-savings program with commercial health plans.

“While in an ACO, you’re asking the health care providers, the physicians, to be able to say, ‘How can I provide more efficient and effective care at a better cost?’” Dr. Magoon said. “This is the beginning of an opportunity for us to reassess how we affect that health care delivery system from the ground up.”

Making the marriage work

Alliance’s path to MSSP success began in 2015 with two ACOs and nine primary care physicians representing two different parts of Texas.

In its initial incarnation, Alliance ACO was a TMA PracticeEdge-formed group of rural physicians in Gonzales, Shiner, and other nearby towns. TMA PracticeEdge also helped form Hill Country ACO with several independent practices based in Kerrville. Both ACOs individually applied for participation in the 2016 MSSP, which required 5,000 patients. Each group was just short.

Then TMA PracticeEdge introduced the two groups, soon after nicknamed the “prairielanders” (the original Alliance ACO) and the “highlanders” (originally Hill Country). They decided to “get married,” as Dr. Sprouse put it, and agreed to use the name of the ACO with the most patients. Alliance had about 100 more than Hill Country.

One of the things that made the marriage work, Dr. Sprouse says, was involving both groups in leadership. Instead of a top-down hierarchy of decisionmaking, he said, “we kept co-officers. We kept co-presidents, we kept co-secretaries, we kept co-treasurers. So each of those groups knew that their voice was going to be heard.”

While the geographic spread of the practices made the marriage challenging, Alliance made the long-distance relationship work with consistent communication. Dr. Sprouse says Alliance’s board has conference calls once a month, and its co-presidents, Gonzales family physician Garth Vaz, MD, and Kerrville family physician Martin Franklin, DO, talk much more often than that.

“[We] kind of went in on it with the idea that TMA wouldn’t suggest we get together if TMA PracticeEdge didn’t think that it was going to work,” Dr. Sprouse said. “And it has worked.”

Alliance began its first Medicare contract in January 2016.

By its 2017 performance year, it had 56 primary care physicians, and its results were dramatic: More than $6.6 million in shared savings. About half the money — $3.2 million — went to the ACO, some of which covered initial startup costs. The ACO’s quality score was nearly perfect at 99 percent.

Its success comes in part from finding ways to deliver better, low-cost patient care. For example, Dr. Vaz, Alliance co-president, says its physicians seldom send patients to the emergency department (ED), saving that drastic step only when the patient truly needs it.

Instead, they offer a number of in-office treatments that patients would otherwise get if sent to the ED, such as intravenous heart medication or nebulizer therapy for exacerbated asthma. That increases the physicians’ revenue by about $500, Dr. Vaz estimates, while saving on overall costs — because a trip to the ED and an overnight hospital stay could instead cost several thousand dollars.

“We guide the rest of the physicians in that path, and we’re going to continue to do that,” Dr. Vaz said. 

Dr. Sprouse says physician engagement is a priority. That engagement must happen on two levels, he says — at the physician leadership level, and among the “rank and file” physicians who make up the rest of the ACO. 

Dr. Sprouse credits TMA PracticeEdge and its population-management partner, Innovista Solutions, for their guidance in helping Alliance reach its savings summit. TMA PracticeEdge was essential in the formation and the early days of the Alliance merger, he says, and the ACO’s 99 percent quality score “didn’t come accidentally. That came … with Innovista assisting us in education of what the quality measures are, and then assistance in devising ways that we can be sure that we meet all of those.”

By joining TMA PracticeEdge, physicians get access to the resources needed to start up an ACO, says Kim Harmon, vice president of ACO Services. For example, TMA PracticeEdge and Innovista provide a technology platform to receive and analyze payer data, which helps physicians meet quality measures and track their total cost of care. A care management team identifies patients who might need extra support, such as those who frequent the ED or who have recently been discharged from inpatient care.   

“With 13 ACOs across Texas, we can scale these resources to make them affordable,” Ms. Harmon said. “In Houston, for example, five ACOs share a common staff to manage contracts with five payers. On the commercial side, many health plans offer a care coordination fee that helps pay for these services, whether they’re provided by Innovista or the physician practice. The MSSP program does not offer financial assistance so physicians must find ways to pay for ACO management. That is why many physicians turn to hospitals or venture capital to fund their efforts.”


“That moment where their eyes were open”

Victoria Farias remembers the first time physicians in her commercial ACO got a look at their own performance data. Some of them reacted with dismay.

Ms. Farias is the administrator for Rio Grande Valley Health Alliance (RGVHA), another member ACO of Osler (the TMA PracticeEdge ACO group working with private health plans). Like Buena Vida y Salud, RGVHA participates in Medicare’s shared savings program, but also joins the other Osler ACOs in a Blue Cross and Blue Shield of Texas (BCBSTX) incentive program.

When RGVHA doctors first saw their per-member, per-month data, “in particular for home health, I was … a little bit worried, like, ‘I don’t know if this is going to work.’ Because there were some physicians that were just a little upset or shocked, or they weren’t aware,” Ms. Farias recalled. “It was kind of that moment where their eyes were open. They never before had had that type of very specific data.”

Just a few months later, when RGVHA posted the next round of data, that shock had turned to belief and buy-in. Physicians in the ACO began calling Ms. Farias and asking her for the old reports that had thrown them for a loop.

That was the moment she realized RGVHA was going to work.

“I was recently at the NAACOS [National Association of ACOs] conference, and somebody mentioned that you can have the best data-analytics system, you can have the best care-management program, and you can have the best of everything. But if your physicians aren’t engaged, then you really aren’t going to be able to achieve very much,” she said. 

RGVHA generated just under $10 million in shared savings in 2017, with more than $6.8 million of that going into the ACO’s pocket. RGVHA earned that savings as a Track 3 Medicare ACO, which entailed the highest amount of risk — and possible reward — in 2017. At press time, CMS was examining potential changes to the MSSP tracks for 2019.

For Dr. Magoon and Buena Vida y Salud, MSSP was also lucrative in 2017. Buena Vida earned more than $2.3 million in shared savings, with just over $1 million of that going back to the ACO. 

However, Osler, in its first year in the BCBSTX program, did not achieve shared savings. Dr. Magoon says a big factor was the lack of a level playing field between Osler and the other ACOs with which it was compared. For example, Dr. Magoon says, one-third of Osler’s patients are diabetic, but other ACOs they competed with didn’t have the same prevalence of chronic disease.

“We don’t have a choice of who we’re compared to, so they compare our entity with a community that is not reflective of the same demographics that we have,” she said.

Osler’s 2018 contract with BCBSTX adjusts for that, Dr. Magoon says, so she’s hopeful Osler will earn bonuses this year.

Harold Miller, president and CEO of the Center for Healthcare Quality and Payment Reform (CHQPR), notes that ACO performance has varied dramatically.

“There are some ACOs that have achieved significant savings and have done a variety of things in terms of being able to improve services,” he said. “There’s other ACOs that have not achieved much savings. There are some ACOs where spending has, at least by CMS’ benchmarks, increased significantly.”

CHQPR’s analysis of the MSSP results shows that only about a third of ACOs in the program earned shared savings in 2017. Other data show, however, that physician-led ACOs are more successful than hospitals are. (See “ACOs and Medicare Shared Savings: By the Numbers,” right.)


Tips for success

Dr. Magoon adds that ACO success is “about managing your patient population … because you want to maximize your outpatient care, so that way you can improve your patient’s well-being to your greatest extent.

“If it’s a disease process that can easily be handled in an outpatient basis, you want to be able to take care of those things in your office, rather than sending the patient to the emergency room.”

Ultimately, she says, care coordination is fundamental to achieving four main goals: Giving patients the right care in the right place at the right time with the right resources.

And, as Osler learned, it’s important to make sure your contract to participate in a commercial shared-savings program is fair. 

Examples of what to examine, Dr. Magoon says, include: “Who are you being compared to? Are you being compared to yourself? … Are you being compared to regional numbers? Are you being compared to national numbers? Are you being compared to a subset, and will they tell you what that subset of providers or patient population’s going to look like? Because that will determine a component of your overall success.”

Taking a team approach within the ACO is crucial, Dr. Sprouse says: Don’t look at your ACO brothers and sisters as competition.

“We were willing to help each other out,” he said. “And if someone was having trouble with … saving money, we’d flood that practice with ideas that have been successful in other practices for saving money. Or if one practice was having trouble with, ‘Gosh, I haven’t been able to implement a good system for getting my annual wellness visits to come in,’ well, other practices that had a good system, we wanted to share that information with each other and use each other’s best practices."

For Dr. Vaz, “The beautiful thing about this whole concept is that when we do the things that are necessary for the patients … when we do the quality measures, we make money right then,” he said. “It increases our revenue flow, plus we save. That’s the one thing that’s beautiful about the concept of an ACO — it’s just genius.”



TMA Specialty Services: Helping You Stay Independent

TMA Specialty Services is a new TMA initiative to support independent specialists through successful participation in value-based delivery and payment models. TMA Specialty Services helps specialty physicians and practices through:

  • Networks: Helping practices achieve scale as independents by facilitating network development, collaboration, and governance;
  • Advice: Negotiating and supporting networking opportunities in value-based care, including contracting and capital; and
  • Analytics: Maintaining a clinical data warehouse that serves as an in-house, specialty-specific analytics department.

For more information on TMA Specialty Services, call (512) 809-5519 or email


Tex Med. 2018;114(12):16-21
December 2018 Texas Medicine Contents
Texas Medicine Main Page

Last Updated On

January 02, 2019

Originally Published On

November 26, 2018