Planning on developing an accountable care organization (ACO)? Not so fast. According to a viewpoint article published June 6 in the Journal of the American Medical Association , numerous federal and state laws, regulations and public policies could slow down or bar the formation of ACOs.
“Prudent modification or removal of these barriers is necessary for healthcare to adapt to a new world of ACO-based competition,” wrote Victor R. Fuchs, PhD, from Stanford Institute for Economic Policy Research, Stanford University, Stanford, Calif., and Leonard D. Schaeffer, PhD, University of Southern California, Los Angeles.
For ACOs to succeed, the authors said they must be capable of providing quality care to large, self-defined populations for a risk-adjusted capitation payment. “ACOs must be able to coordinate the full continuum of care across multiple delivery sites using EMRs, be capable of creating and adhering to cost-effective guidelines for diagnosis and treatment, and be able to measure, monitor and report clinical and financial performance,” Fuchs and Schaeffer wrote.
The authors questioned who should create and manage this type of organization. On one hand, physicians know how to practice cost-effective medicine yet have generally undervalued systems, they wrote. Hospitals have more capital and professional management yet hospital administrators have been “trained and rewarded for their ability to fill beds.”
“It seems that the operational infrastructure required to create and manage ACOs is found in large health plans, both not-for-profit and for-profit,” they wrote. “These plans have the necessary access to capital, depth of professional management, expertise in managing financial risk and information technology infrastructure for collecting, integrating and analyzing data aggregated from multiple sites. Health plans may resist abandoning their present business models, and they are unpopular with other stakeholders, but the looming fiscal crisis will require them to build a new model of partnership with physician groups and physician-hospital organizations to keep healthcare in the private sector as an alternative to a government-run healthcare system.”
The authors concluded that regulators could accelerate development of ACOs by establishing a regulatory framework that would clearly delineate the responsibilities of the integrated care delivery system versus those of the health plan to ensure the distinct functions are in place, require ACOs to demonstrate a minimum set of competencies for improving value and apply solvency/risk-based capital standards to ACOs that assume significant risk.