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Affirmant Health, Michigan’s largest clinically integrated network of more than 5,400 physicians, is shuttering operations at the end of 2021, the organization announced Friday.
The Portage-based accountable care organization is disbanding after its members voted unanimously to end their agreement. Affirmant’s ACO included Detroit’s Henry Ford Health System, Lansing’s Sparrow Health, Saginaw’s Covenant HealthCare, Kalamazoo’s Bronson Healthcare Group and Spectrum Health’s Lakeland hospital in St. Joseph.
Spectrum Health as a whole dropped out of the ACO in 2017.
In the six years of operation, Affirmant delivered $75 million in shared savings, the organization said in a press release.
The group voted to disband largely because the members became more competitive and didn’t work together as required by the agreement.
“We were extremely successful at our goal; we knocked it out of the park,” said Katy Velten, interim chief operating officer and communications executive for Affirmant. “But in order to maintain success, you have to collaborate and be behind the mission of providing value-based care and that being more important than your own individual health system’s objectives. That’s very hard to do.”
Velten indicated the competitive health care landscape made it harder for the organization to gain consensus among its members.
Spectrum is in the process of merging with HFHS’ biggest competitor, Beaumont Health, to create the state’s largest health care system, upping the stakes of their competition.
“We have had changes in leadership at the different health systems and that brings changes to strategy,” Velten said. “Our original strategy worked…but as new leadership comes in and that focus shifts, things can derail.”
HFHS and Spectrum both have other ACOs in place, Velten confirmed.
Mark Kopson, partner at Bloomfield Hills law firm Plunkett Cooney PC and chair of its health care practice, said the loss of an ACO can be problematic for its members and patients, as long as the ACO was performing well.
“By participating in an ACO, you eliminate variations and drive everybody toward the high performing, both financially efficient and good outcomes,” Kopson said. “If the performance is better, then in that case, the savings will be shared between the payer and the providers. If it’s a high-performing ACO network, then loss of the ACO would be detrimental for the provider financially and for the health care outcomes for patients.
“If it’s not very successful, then there’s a strong argument to made that you’re not losing much.”
Velten believes the member organizations will continue the cost savings and quality improvements it achieved under Affirmant with their own or new ACOs.
“Honestly, with the work they did with us, they are going to be able to carry that on to the next organization that they join,” Velten said. “This is really meaningful work and I hope they continue it.”
The last day of operations for Affirmant, which has downsized to five employees from 12, is Dec. 31.
Editor’s note: A previous version of this article incorrectly described the tension among Affirmant’s partners.
This story first appeared in our sister publication, Crain’s Detroit Business.
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