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In creating your strategies for cost control, your ACO must consider how to reduce Total Per Capita Cost (TPCC) while ensuring the financial survival of your ACO and participating providers. This balancing act is the dilemma facing all providers adopting Value-Based Care: how to achieve more savings while replacing revenue lost from services. Here’s how data can guide your efforts to sustain your ACO while stewarding high quality and affordable care:
Total Cost of Care Is a False Starting Point
If you are looking at Total Cost of Care (TCOC) or TPCC as your primary metric for cost control, you’re on the wrong track. Aggregating your health care service costs to a payer and for a population of patients is not informative except in comparison with other groups. Nor are those total costs, in isolation, actionable. To affect TCOC or TPCC, you need to address the situations that affect those total cost metrics, including:
- High or inappropriate utilization or services;
- Costs that spin out of control but can be managed;
- Patients sent outside your network where there are no linkages to your primary care or population health.