Since the
implementation of the Affordable Care Act (ACA), the healthcare world has been
inundated with new ideas, new laws, and a lot of change. One interesting part
of the ACA that is not getting much attention is the formation of Accountable
Care Organizations (ACOs) nationwide. The
objective of the formation of an ACO is to combine different areas of medical
care into one functioning organization that allows providers to work together
to treat patients in the most efficient and cost effective way and rewards the
providers for their teamwork.
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The ACA
includes incentives to form ACOs in an effort to cut costs to Medicare. Centers
for Medicare and Medicaid Services (CMS) estimates that patients taking
advantage of an ACO will accrue approximately $960 million in savings for
Medicare over three years. The savings comes from patients seeing doctors who
are members of the same ACO and work together to streamline care. Duplicate
testing and unnecessary procedures are avoided, and patients are well taken
care of by doctors who are in constant communication. Two out of three
Americans over 65 have multiple chronic conditions. These patients benefit the
most from care provided by an ACO. Coordinated care leads to fewer mistakes,
better coordination of care, and less hospital readmissions due to poor follow
up care.
The ACA is
attempting to turn the healthcare industry away from a purely fee-for-service
system to a system that operates with more efficiency and less redundancy of
work. In an ACO structure, physicians are rewarded for value and meeting
pre-set standards in quality instead of being rewarded solely for volume of
medical care. ACOs combine fee-for-service, care management, and performance
incentives.
Opponents of
ACOs are concerned that they too closely resemble the HMOs of yesterday. The
biggest difference between the two is the lack of network in the former. ACO
patients are not required to visit doctors that are in their ACO. They are free
to visit any doctor that accepts their insurance. However, staying in the ACO
network benefits patients because all of their doctors are working cohesively
for the best possible healthcare outcome.
Providers are
seeing numerous benefits for forming an ACO or joining an already existing one.
The foremost advantage is the shared savings. When an ACO meets quality benchmarks
and the cost-of-care falls below the established threshold, the entity then
gets a portion of the savings. There are 33 measures in 4 domains that an ACO
must hit. In the first year, an ACO is paid for reporting, and in the second
and third years they receive incentives for reporting and performance.
While ACOs
are still in the early stages of growth, the number is steadily climbing.
Currently there are a total of 428 ACOs in 49 states. They still serve mostly
Medicare patients, but the numbers of those for privately insured patients are
growing as well. Unlike Medicare ACOs, private ACOs have a good bit more flexibility.
However, they do serve the same purpose—sharing savings by joining together to
provide coordinated quality care.
There is
concern that ACOs that dominate the healthcare landscape in any particular
area, especially rural areas where there are few healthcare choices, can be
considered a monopoly. This was taken into consideration, and the same day that
CMS established the rules for ACOs, the Justice Department and Federal Trade
Commission also issued rules that allow a certain amount of consolidation for
health care groups. If you are a physician looking for more information on
establishing an ACO, refer to the CMS website for rules and regulations and
contact your healthcare attorney.
Sources:
Accountable
Care Organizations (ACO). (March 22, 2013.) Centers
for Medicare and Medicaid Services. Retrieved April 18, 2013 from http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ACO/index.html?redirect=/aco/
Accountable
Care Organizations: Improving Care Coordination for People with Medicare.
(March 12, 2012). Health Care.gov. Retrieved
April 18, 2013 from http://www.healthcare.gov/news/factsheets/2011/03/accountablecare03312011a.html
Bouchard,
Stephanie. (November 22, 2011.) NCQA Releases ACO Guidelines. Healthcare IT News. Retrieved April 18,
2013 from http://www.healthcareitnews.com/news/ncqa-releases-aco-guidelines
FAQs about
ACOS. (2013.) AAFP. Retrieved April
18, 2013 from http://www.aafp.org/online/en/home/practicemgt/specialtopics/designs/practiceaffiliationoptions/faq.html#Parsys22917
Muhlestein,
David. (February 19, 2013) Continues Growth of Public and Private Accountable
Care Organizations. Health Affairs Blog.
Retrieved April 18, 2013 from http://healthaffairs.org/blog/2013/02/19/continued-growth-of-public-and-private-accountable-care-organizations/
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