Medicare in January 2016 announced an ambitious expansion of its accountable care organization (ACO) program, designed to improve the quality of care for Medicare beneficiaries while at the same time lowering costs.
An accountable care organization is a network of physicians, hospitals, and other healthcare providers that band together voluntarily in an effort to provide coordinated care to their patients. The ACO is of relatively recent vintage, having first emerged from health care reform discussions in the first decade of the 21st century.
121 New ACOs
Under Medicare’s latest expansion of the ACO program, 121 new ACOs were admitted into the program, bringing the total number of these coordinated care networks to 477 across the United States. Close to 9 million Medicare beneficiaries will be getting their care through ACOs. That’s roughly one in every four seniors receiving Medicare benefits.
Of the 121 new ACOs announced by Medicare, 21 are being admitted to the “Next Generation” program, which allows member ACOs to directly recruit patients. The ACOs selected for participation in the Next Generation program have significant experience coordinating the care of patients through incentives.
Ultimate Goal of ACO Program
According to the Centers for Medicare and Medicaid Services, the ultimate goal of coordinated care provided under the ACO model is to ensure that beneficiaries, especially those with chronic health conditions, get “the right care at the right time.” Because care is closely coordinated among each network’s providers, the model is designed to minimize medical errors and prevent the unnecessary duplication of services.
Care is all too often “fragmented and disconnected” in traditional health care settings, which lack coordination between all of a patient’s providers, notes the CMS. The ACO is designed to eliminate some of the most common frustrations that patients encounter under the traditional care model. These include lost or misplaced medical data, duplicative diagnostic tests and/or medical services, problems in scheduling appointments, and repeatedly supplying personal and medical history data to different health care providers.
Benefits Patients and Providers
The ACO model offers benefits for both patients and providers. Patients can expect to have better control over their healthcare while providers will enjoy more comprehensive information about their patients’ medical history as well as closer ties and better-working relationships with patients’ other providers.
As some have noted, the ACO bears some resemblance to the health maintenance organization (HMO) that in the 1970s was touted as an effective tool to keep health costs under control. Both concepts involve discrete networks of health care providers and seek to control costs by promoting closer coordination of patients’ health and group resources.
Key Differences Exist
However, some significant differences exist between ACOs and HMOs. The latter was essentially the creation of insurance companies, while insurers have no direct role in patient care decisions with ACOs. Under the ACO model, participating providers are financially rewarded for coordinating all aspects of a patient’s care. The success of an ACO depends upon close coordination between all provider participants. Primary care providers need to work closely with pharmacists, nurse practitioners, and other ACO members to manage medication schedules, monitor appointment compliance, and supervise patient lifestyle changes.
Because patient participation in ACOs is voluntary, the network has no enrollment or lock-in provisions, which means that ACO patients can be seen by any doctor of their choice. If patients are unhappy with the quality of care that they receive within the ACO, they are free to seek treatment elsewhere. Unlike patients who received care from HMOs, ACO patients need not obtain a referral before consulting with another provider.
ACO Savings Realized
This latest expansion of the ACO program comes less than a year after CMS announced that its Pioneer ACO model chalked up savings of more than $300 for each of the 600,000 beneficiaries enrolled in the program. In announcing the promising results from its ACO program, CMS chief medical officer Patrick Conway, M.D., said these positive results paved the ways for increasing the scale of the program.
“Beyond the early financial success of this model,” said Dr. Conway, “we’re also seeing important quality improvements. Compared to their counterparts in regular fee-for-service or Medicare Advantage plans, Medicare beneficiaries who are in Pioneer ACOs for example report more timely care and better communication with their providers.”
Other Benefits Cited
Other benefits of the ACO program, according to Dr. Conway, included fewer visits to the emergency room, reduced hospital admissions, and a reduction in tests and procedures. He also pointed out that patients in the ACO program tended to have more follow-up visits from their providers after being discharged from the hospital, which demonstrates a commitment to care coordination.
Of the outlook for further ACO growth in the year ahead, Dr. Conway said that as recently as five years ago, there was little incentive to coordinate care. “Physicians wanted to do well for their patients, but the financial incentives were completely aligned with volume.” Now under the ACO model, network participants get part of their reimbursement for meeting quality or cost targets.
Some Data Difficult to Access
One significant hurdle to further ACO growth is the current difficulty in exchanging patients’ medical data between ACOs’ health information technology systems and those of outside providers. On January 20, 2016, Premier Inc. released a 10-page survey report entitled “The Evolving Nature of Accountable Care.” Premier is a health care alliance made up of about 3,600 U.S. hospitals and 120,000 other providers. Its goal as an organization is “to improve the health of communities.”
In its ACO report, it notes that getting vital medical data from settings outside an ACO’s own network requires new inter-system interfaces and data-sharing agreements. “Unfortunately for ACOs, their need to manage entire patient populations also requires that they integrate data from many of these disparate systems.” This is a challenge that ACOs are still struggling to meet, according to the report’s authors.
Making this an even more daunting challenge is the difficulty in obtaining critical data from health care providers that did not receive federal electronic health record incentive payments. Such providers include behavioral health providers, hospice organizations, and providers of long-term and post-acute care. According to the report, 53 percent of the ACOs that responded to the survey have not yet integrated medical data from behavioral health providers. Forty-eight percent don’t have data integration with long-term and post-acute care providers, while 46 percent have not yet integrated their data with input from palliative and hospice care providers.
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Photo credits: QualityNet Conference, Kita Baca, Anatomy for Dummies
Don Amerman is a freelance author who writes extensively about a wide array of nutrition and health-related topics.
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