Anita Varkey, MD

A new type of primary care clinic has opened in Birmingham focused exclusively on seniors. “Oak Street Health’s mission is to rebuild healthcare as it should be, and we are passionate about bringing our unique model of care to older adults across the country,” says Anita Varkey, MD, senior medical director for the Southeast. Over the past nine years, Oak Street has opened 125 centers across 20 states.

The organization looks for locations with a Medicare-eligible population that has been historically underserved in order to make healthcare easily accessible to that community. “Our decision to open a clinic in Birmingham, specifically in CenterPoint, was very intentional,” Varkey says. They estimate the center will provide the new healthcare option to the nearly 15 percent of the city’s residents 65 years and older.

Using a value-based model of care, Oak Street approaches interactions with their patients differently. “We are not focused on the volume of patients or services provided,” Varkey says. Instead, they aim at prevention and managing chronic conditions to avoid hospitalization through dedicated attention and meticulousness.

For instance, patient relationship managers and nurses reach out to patients between visits by phone and even in-person for check-ins and problem solving. “Our goal is to prevent illness. We do that by being high-touch,” Varkey says.

More vulnerable patients coming out of the hospital or facing a new serious illness or complicated chronic condition may be seen at the clinic every three to four weeks, even if they are handling the situation well, since the mission is to prevent problems, not just respond to them.

In return, Medicare does not pay the clinic for each service or procedure performed as with traditional healthcare, but rather with a monthly lump sum per patient dependent on their health status and conditions. Any costs beyond that amount, Oak Street must cover themselves.

The freedom from fee-based restrictions opens Oak Street Health to devising their own approach to care. “We operate in a team-based model,” Varkey says.

At Birmingham’s CenterPoint clinic, staff consists of not just a primary care provider and nurse, but a social worker, patient relationship manager, and scribe, who inputs notes on the computer during the visit, allowing the care provider to completely focus on discussions with the patient. “So each patient has a full care team supporting them to ensure his or her needs are met,” Varkey says.

The team interaction explains why clinic visits can last an hour, whereas most fee-based physician appointments last half that time. In addition to at least 20 minutes face-to-face with the provider, the patient may sit down with the social worker and the medical assistant to address anything that will help them manage their condition and keep them out of the hospital. Oak Street also provides free transportation to and from appointments within a certain distance from the clinic.

The patient relationship manager offers a service appreciated by anyone with health insurance. “That individual helps demystify Medicare services for a patient,” Varkey says. “Insurance can be very confusing for a patient and their family. This approach only works with an investment in a multidisciplinary team. And that upfront investment is not something that many places are willing to make.”

In contrast to the dominant fee-for-service model which relies on volume, Oak Street Health does not get paid any more for doing more things. “We are paid to be accountable for the entirety of the medical costs for a patient, which helps manage the cost of medical care. But our goal is to improve the health status of all the patients,” Varkey says.

According to the statistics based on data from the Centers for Medicare and Medicaid Services, they are succeeding. In October, Oak Street Health reported to investors that their accountable care organization (ACO), Acorn Network LLC, had the fourth highest savings rate of 513 ACOs in the Medicare Shared Savings Program in 2020–16.86 percent compared to the average of four percent.

Yet over their nine year history of using the value-based model, Oak Street Health has reduced both patient hospital admissions and emergency room visits by 51 percent, compared to Medicare benchmarks, and generated a 42 percent reduction in 30-day readmission rates.

“Everyone wants to avoid hospitalization, if possible, and that is what we trying to do,” Varkey says. “We are thrilled to come to Birmingham and the CenterPoint area and look forward to meeting new patients, and improving their health outcomes.”