Wilmington Health has expanded its footprint in the area of accountable care organizations, or ACOs. 

After switching to a different ACO model offered by the Centers for Medicare & Medicaid Services (CMS), it’s now on track to be the second-largest group of its type by joining up with other provider groups on the project.

Physician-owned Wilmington Health has participated in accountable care organizations since the model’s early days after it was born out of the Affordable Care Act that passed in 2010. Part of the sweeping federal overhaul included the ACO approach that attempts to incentivize voluntarily participating provider groups that show they can stem rising health care costs while meeting patient care outcomes goals, starting with Medicare patients.

When that happens, organizations can be eligible to share in the cost savings that are achieved. But they also face the risk of paying penalties if the goals aren’t reached.

Wilmington Health’s ACO, called Physicians Healthcare Collaborative, formed in 2013 as a Medicare Shared Savings Program model and a few years later ranked among the top nationally in the combination of cost containment and patient quality.

It has since moved its plan into what is now called an ACO REACH, or Realizing Equity, Access, and Community Health, model. Like under the Medicare Shared Savings Program, different providers including primary care and specialists work together on the care of participating Medicare patients to try and improve their health while showing savings on overall costs because of the coordination.

In the ACO REACH program, there also is an emphasis on health equity, with CMS requiring participating ACOs to have plans about how they will reach Medicare patients in underserved communities.

“The goals are really narrowed down to some measures that are truly impactful for the patient population: reducing readmissions, trying to reduce any unplanned admissions, making sure that our follow-up with our patients is timely and appropriate and then demonstrating measures in the patient experience,” said Melissa Odom, Physicians Healthcare Collaborative’s chief operating officer.

There are about 100 organizations nationally in the ACO REACH model, Odom said.
The Centers for Medicare & Medicaid Services offers several ACO types, with different structures for sharing overall savings with a participating group as well as different benchmarking approaches.

There were about 12,000 Medicare beneficiaries in the Physicians Healthcare Collaborative ACO in 2022, Odom said. In 2023, other partners based in Florida joined the ACO, and other smaller groups have joined as well so that the number of patients participating has increased significantly.

With the agreements with other provider groups, the Physicians Healthcare Collaborative’s footprint now spans the Wilmington area, part of Raleigh, most of Florida, and Jackson, Tennessee.

“The largest group concentration would be out of Florida, and then Tennessee would even be higher than us [in Wilmington where about 12,000 participants are based]. So, we’re actually a small player in the ACO that we manage and help and run for these other these other organizations,” Wilmington Health CEO Jeff James said. “I think we may be the largest ACO REACH in the country that is still truly physician led. We don’t know what happened in 2023; there may be some that got bigger than us in 2023. So, we’re comparing our numbers now to 2022 published data.”

New Hanover Regional Medical Center launched its own ACO several years ago. Called Physician Quality Partners, it continues to operate under the Medicare Shared Savings Program model.

Novant Health absorbed the ACO when it acquired NHRMC in 2021, and the ACO now covers about 18,500 patients.

Under the 2022 data, Physician Quality Partners led the state for ACOs in the Medicare Shared Savings Program (a different option than Wilmington Health ACO REACH’s model) for quality performance in the state. Because Physician Quality Partners saved CMS $4.7 million, it generated a $2.3 million payment to Novant.

Earlier this year, Wilmington Health also opened a separate ACO in Florida, this one under the Medicare Shared Savings Program.

“For groups who want to learn like we did we’re helping them use that vehicle to learn in a track that’s a little less risk,” Odom said, referring to the level of financial risk ACOs take on to either show they improve costs and patient quality to share in savings or pay CMS if they don’t.

The increased focus on ACO activity, especially outside Wilmington Health’s core geographic market, comes because of several reasons, James said.

“One is, we get asked to do it because other people want to align with us,” he said. “We feel a responsibility to help these other practices come along as well. And then, also, there’s a financial benefit for us in using our platform. We share in their success, and there’s some fee that we are able to retain because of their participation. So, it helps us to lower some of our costs in doing it, and it’s a way for us to continue to grow our services without our physicians having to see more patients.”

James said he sees the practice continuing to invest in the ACO arena.

“We need to build out a little more infrastructure in the early first quarter of this year and then we expect to go harder to market and add more in both the ACO REACH space as well as the MSSP [Medicare Shared Savings Program] space and then also continuing to grow our clinical research company, which enhances population health,” James said. “Two of the participants we have in our ACOs are also participants in our clinical trials company, which now spans seven states, 2,500 providers, 4.5 million patients.”