Accountable Care Organizations: Are they right for me?

As providers we are always bombarded with new regulations, government mandates and creative insurer plans or programs designed to help us increase our revenue. But with limited time and other resources, doctors and mid-levels need to quickly and clearly understand if some new program is right for them. With that in mind, here is a summary of ACOs ( Accountable Care Organizations) based on what we know about them from the latest CMS regulations and a pros/cons analysis to help you decide if it is something you want to participate in.

Definition:  An accountable care organization is a group of providers and suppliers of services that coordinate to provide high quality care (as defined by CMS) to a group of Medicare beneficiaries who are not in a Medicare Advantage Plan.

•Providers from individual practices, group practices or a network of ACO professionals can participate regardless of speciality

•The financial benefit is that providers can get the savings from care provision in an ACO program as extra revenue

•The risk is that providers may share in the loss of money from care provision in an ACO program

The requirements to participate are:

•File application with CMS

•Form a legal entity that is linked through bank accounts with CMS,

•Have at least 5,000 Medicare beneficiaries over 3 years in panel,

•From governing body with at least 75% of individuals participating in ACO.

•Have a Board certified physician as medical director, CMS liason on ACO leadership

 committee

•Have quality improvement program and abiility to identify high-risk individuals in place

Approval is a for a 3-year period at stretch. 

What quality measures are tracked?:

•Patient-care giver experience

•Care coordination

•Patient safety

•Preventative health

•At risk population/frail or elderly

These measures are tracked by comparing to benchmark data sent by CMS and scores 1-5 are assigned to each. If the performance is better than the benchmark then savings occurs, if not then loss.

Pros- ACOs:

Can result in extra revenue through cost savings

Help organizations establish valuable care processes (ie. quality improve program, tracking certain data, better of electronic medical record functions)

Results in better coordination of care for the patient

Advantages of ACO schematic


(Reference: susiecookhc.wordpress.com)

Cons-ACOs:

Time-consuming to set up an ACO and run it

Could be costly from setting up the ACO, loss from performance below benchmarks

Too many unknowns -not sure what new rules CMS will require in years to come 

The ideal ACO participants: Practices that have several providers and staff, have a QI program, use the EMR to track outcomes and have a large Medicare population.  

Quotes about ACOs from different experts in the field: 

“But if ACOs models are to work, they’ll eventually have to embrace smaller practices, which make up the vast majority of U.S. medical groups overall. And if those groups are either EMR-less or just getting started, it’s going to be pretty tough to share value-based payments, coordinate across episodes of care and track quality jointly” -Kathryn Rourke (EMR and EHR)  

“But here’s the problem with ACOs: They are a tool in a big tool box of care and cost management tools but, like all of the other tools over the years like HMOs and IPAs, they won’t be used as they were intended because everybody—providers and insurers—can make more money in the existing so far limitless fee-for-service system.” – ROBERT LASZEWSKI (The Healthcare Blog)

Conclusion:

Accountable care organizations represent, yet, another paridigm to deliver high-quy ality care. The summary about ACOs presented here is very cursory with specific details that are available on the CMS website . I hope the information presented here will give you, as provider, a feel for wether the ACO program is something that you qualify for and want to participate in. My opinion is that ACOs are not a good return of investment for small practices with 1-3 providers or any practice without the extra resources and time to devote for this.

What do you think? Are ACOs something you want to or would be a part of? We would love to hear your thoughts?

By: Jitesh Chawla, MD.