Clinical laboratory managers and pathologists will want to develop strategies for adding value under ACO model

One lesson learned from a pilot accountable care organization (ACO) project is that increased utilization of clinical laboratory testing in appropriate circumstances will contribute to improved patient outcomes. Just one year into a pilot ACO partnership, Norton Healthcare and insurer Humana Inc. (NYSE: HUM) have shown quality gains and some modest savings.

This is encouraging news for pathologists and clinical laboratory managers. It shows that, when physicians participating in ACOs more closely follow evidence-based medicine (EBM) guidelines, the increase in lab test utilization can play the expected role in improving diagnosis and guiding therapeutic choices. However, it should be noted that the results disclosed by the Norton/Humana ACO pilot only cover a short period of time.

“[Producing results] was not our goal for the first year,” said Thomas James, III, M.D., Corporate Medical Director of National Network Operations at Humana. “We did better than what we expected.” In addition to his role at Humana, James is a practicing physician who works at Norton hospitals on weekends.

This pilot project is part of an effort to begin testing and refining the ACO model, according to an earlier Norton press release. The goal of the ACO model is to increase quality and efficiency, better coordinate patient care, eliminate waste, and reduce the overuse and misuse of care by establishing incentives for health systems, the release stated.

Norton/Humana Pilot Project Is a Test Drive for the ACO Model

Both collaborators in this ACO are based in Louisville, Kentucky. This is an example of a private health insurer joining with a provider organization to organize an ACO. It was in early 2010 when this ACO partnership was launched.

It was in 2010 when Norton Healthcare and Humana came together and formed a pilot accountable care organization (ACO). The ACO has a patient population in the Louisville, Kentucky-area of 7,000 individuals who are employees of Norton and Humana.

It was in 2010 when Norton Healthcare and Humana came together and formed a pilot accountable care organization (ACO). The ACO has a patient population in the Louisville, Kentucky-area of 7,000 individuals who are employees of Norton and Humana.

Norton is a network of five not-for-profit hospitals. It is one of five pilot sites that are part of a joint project of The Dartmouth Institute for Health Policy & Clinical Practice (TDI) and Brookings Institution’s Engelberg Center for Healthcare Reform. Humana, a leading health-benefits provider, has worked with Brookings-Dartmouth since 2008 to explore the ACO concept, the Norton press release stated.

The Dartmouth Institute and Brookings are working with health systems, physicians, commercial health insurers, state governments, and the federal government. Their goal is to engage stakeholders in the challenge of reforming the delivery of healthcare, stated TDI on its website.

In its coverage of this pilot ACO, Modern Healthcare noted that Dartmouth and Brookings supplied the Norton-Humana pilot with initial quality measures, along with the formula to calculate potential savings and a method for identifying patients included in the pilot.

MH further reported that the two companies agreed to share savings beyond an initial 2% reduction in costs for patients included in the ACO pilot. Hospitals and doctors would receive 40% of any savings. The remaining 60% would be returned to Norton and Humana for workers’ healthcare costs, MH said.

1st Year Outcomes Show Role of Medical Lab Tests in Patient Maintenance

According to the pilot results, diabetic patient testing rose from 87.7% in the baseline year to 93.4% after the first year of the ACO group, MH reported. It can be assumed that this refers to utilization of Hemoglobin A1c testing. Cholesterol management for diabetics increased to 91.8% from a baseline of 83.9%. Physicians would need to utilize clinical laboratory tests to inform their management of these patients.

Another finding relating to diagnostic testing will be of interest to pathologists. The ACO pilot showed a decrease in the use of imaging studies for those Norton patients who were newly-diagnosed with lower back pain. Imaging for these patients dropped from 65.2% in the baseline year to 56.3% after one year of the pilot. Decreasing the use of imaging has been a target to improve quality and lower healthcare costs, noted MH. The study also showed a marginal increase in cervical cancer screening.

Here are Norton’s 2011 quality measures for physician practices. Appropriate use of clinical laboratory testing is a component of a significant number of these quality measures:


  • Percent of women with screening mammogram in current or previous year
  • Percent of patients with colorectal cancer screening
  • Percent of women with cervical cancer screening
  • Percent of diabetic patients with documented eye examination
  • Percent of PQRS-eligible visits for diabetes meeting desired status (mean of five percentages below)
  • Percent with HbA1c poor control in Type 1 or 2 Diabetes Mellitus (DM)
  • Percent with low density lipoprotein control in Type 1 or 2 Diabetes Mellitus (DM)
  • Percent with high blood pressure control in Type 1 or 2 Diabetes Mellitus (DM)
  • Percent with urine screening for microalbumin or medical attention for nephropathy (DM)
  • Percent with foot exam (DM)

It was the types of pilot results noted above that provide early evidence that physicians practicing within an ACO model are likely to increase their use of clinical laboratory tests because of more consistent adherence to EBM guidelines. This aspect of the ACO care model was noted in a white paper published by a national reference laboratory company.

“Clinical laboratories must recognize the opportunities ACOs create and respond with strategies that position the lab to reach its full potential within the ACO model,” stated the authors of a white paper titled “The Role of Laboratory Medicine in Accountable Care Organizations” that was published by ARUP Laboratories.

Laboratories that succeed in the ACO environment must meet the clinical information needs of physicians practicing within ACO organizations, suggested the authors, who are Joe Miles MT(ASCP) and Ronald L. Weiss, M.D., both of ARUP Laboratories. Further, clinical laboratories must demonstrate their value to ACOs by facilitating decision support and coordinated care.

The development of utilization-management tools is one of the strategies noted in the white paper. “Clinical utilization management has the potential to reduce or eliminate unnecessary expenditures,” the authors wrote.

ACOs are likely to increase lab test utilization for all the right reasons, particularly as the healthcare landscape shifts from episodic care to chronic disease management. Proactive pathologists and clinical laboratory managers will find opportunities to redefine the value and pivotal role of laboratory services as the ACO model continues to evolve.

—Pamela Scherer McLeod

Related Information:

Norton Healthcare press release

Test-driving an ACO: Norton Healthcare, Humana already seeing results in first year of pilot project

The Role of Laboratory Medicine in Accountable Care Organizations PDF

Commonwealth Fund Case Study: Norton Healthcare: A Strong Payer–Provider Partnership for the Journey to Accountable Care PDF

Norton Healthcare, Humana Launch ACO Pilot

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