ACOs have been a "huge enabler" of value-based practices at health systems, says Jaewon Ryu, M.D.,J.D., of Risant Health

In this second segment from a recent video interview with Managed Healthcare Executive (MHE), Jaewon Ryu, M.D., J.D., CEO of Risant Health, discusses the role that accountable care organizations (ACOs) have played in supporting value-based care practices. They have been a "huge enabler," in his opinion.

"If it weren't for the uptake throughout the industry of the ACO kinds of models, I don't know that these health systems would have as much substrate, so to speak; they wouldn't have as much activity in their four walls around value-based care," Ryu said. Prior to ACOs, he said, the only way to have the right payment models to align with delivery care that is value-based was for a health system to either own its own insurance company or have a strong partnership with one. “And, of course," he said, "that's very market dependent and relationship and payer dependent.” Ryu continued, "But if you look across the industry and say, 'Well, how many systems have their own provider-sponsored health plan?' Not many do. It's the overwhelming minority. And how many partner with health plans in a way that's totally aligned in the economics and managed through a population lens? I think that's still the minority as well."

With the advent of the ACO programs 15 years ago — Medicare Shared Savings Program was launched as part of the implementation of the Affordable Care Act — that changed, Ryu said. ACOs have given health systems a financing model to support and bolster value-based patient delivery models.

Ryu spoke to MHE after an article he co-wrote about value-based care delivery at Risant Health was published in the February edition of NEJM Catalyst, an offshoot of the New England Journal of Medicine that is devoted to research and opinions on health systems. In the NEJM Catalyst article, Ryu and his colleagues described the implementation of a set of Kaiser Permanente value-based practices at Risant, which comprises two health systems, Geisinger Health in north-central Pennsylvania and Cone Health in North Carolina. Early results show that the value-based care practices are associated with shorter hospital stays and fewer referrals to specialists.