ACOs: What they entail and how we will benefit

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The U.S. spends more on healthcare than any of the other 34 countries that comprise the Organization of Economic Co-operation and Development, but has seen comparatively little improvement in outcomes. Moving toward an accountable care organization (ACO) model may be the answer to improving patient care in the U.S., said Gifford Boyce-Smith, MD, general internist and senior vice president and chief medical officer of Medicity, during a webinar Dec. 15.

“ACO reimbursement models have to promote accountable care and improved efficiency over time, which will ultimately increase quality and decrease utilization,” said Boyce-Smith.

In addition, he said that ACOs will shift the risk from payors and purchasers — as in the current traditional fee-for-service (FFS) model — to providers, which will allow physicians to better manage patient populations and costs.

Components of ACOs could include integrated delivery systems or large medical groups, and several components will be necessary to ensure quality and successful integration. These components include physicians, generalized and specialized hospitals and ancillary services, which will create a comprehensive approach to care.

The National Committee for Quality Assurance (NCQA) is working to outline criteria and guidelines that should be included in the ACO model. And while Boyce-Smith said that primary care physicians (PCPs) will most likely continue to direct care for their own practice populations, they will now have a complete picture of the various patient populations, such as heart failure or diabetes patients, under the ACO care model.

However, in order to form a successful ACO, Boyce-Smith said that three components are necessary:

  • Stakeholder collaboration;
  • An end-to-end care delivery network — A governing model where end-to-end care can be provided at the local level; and
  • A strong technology infrastructure that brings together heath records, patient populations and clinical decision support.

And while there is a general direction that the ACO is moving in, regulations have yet to be written.

Boyce-Smith said that many questions still remain, including:

  • Payments: How will the hospital be paid?
  • Patient experience: How will patients react? Will they continue care in the ACO or move to be managed by someone else in the community?
  • Governance: Who should run ACOs? Right now, it seems like physicians will run them, but Boyce-Smith said that other stakeholders will likely be seated at the table.
  • Cultural issues: How will physicians who are used to competing for patients and services learn to collaborate?

He said that physician groups and hospitals have several choices: defend their current care model, hope that FFS medicine will continue and be the dominant model, wait for the government to instate a mandate or invest in the health IT necessary to transform into an ACO.

What does an ACO mean for hospitals and physicians?

Rather than keeping the current payment structure under the FFS model, the ACO will bundle payments that will need to be shared between hospitals and other players. In addition, rather than a focus on episodic care, the ACO will include disease management protocols and have a bigger focus in quality performance measures.

Boyce-Smith said that the ACO model will also diminish duplicate testing because there will be a better overall picture of patients within the care model. Additionally, rather than increasing charges when a hospital is overrun by costs, the ACO will offer more accountability and transparency regarding costs.

“Measuring what happens in terms of quality measures and outcomes and demonstrating that you are able to treat cardiac conditions within the national average becomes a very real and clear component of the ACO,” Boyce-Smith said.

For physicians, ACOs will increase coordinated care and offer a complete view of the patient.

According to Boyce-Smith, the benefits of the ACO include:

  • Hospitals will have an enhanced reputation, be able to have a higher quality data reporting system and be able to better represent themselves in the marketplace;
  • A higher degree of physician loyalty and a tight alignment with other agencies across various communities;
  • A decreased cost of doing business because results are distributed electronically and the entire operation is much more efficient;
  • An increase in the continuity of care with special attention paid to patient followup and patient satisfaction;