3 Challenges of ACO Design

Wednesday, January 12th, 2011
This post was written by Jessica Fornarotto

Laurel Karabatsos, deputy director of Colorado’s Medicaid program, describes the challenges her organization faced in designing an accountable care organization (ACO).

We decided to set up our ACO on a regional level and to have seven regions in Colorado. These entities would be called regional care collaborative organizations (RCCOs). They would ultimately be responsible for containing costs and improving the health of our clients. To do that, the RCCOs would need to work with the primary care medical providers (PCMPs), who are the foundation of the program. They are the medical home, they provide clients with a focal point of care, they are asked to offer comprehensive primary care and they help coordinate care for their clients.

As we moved from program design at the high level to working with the divisions within our department, we identified several operational challenges. First were the system challenges. Our Medicaid Management Information System (MMIS) was set up for traditional managed care. Where a client was enrolled with the health plan, there was a rate for each eligibility category. The Medicaid agency didn’t necessarily process claims or track and report on service utilization. In contrast, we wanted to enroll our clients with that plan or the RCCO at the regional level, but also with their medical home provider. And if that provider was part of a larger clinic or a practice, we needed to identify that in our system as well, in which case we would be able to direct payment to the appropriate entity. We also wanted to be able to pay differently at the different levels — to pay the regional entity one sum for their services and the medical homes another.

The next challenge that we ran into was data sharing. We had all sorts of claims and eligibility data on our clients, but we had no system for sharing that with providers or the regional entities. We recognized that half of the battle for our providers in our regional entities was knowing what was going on with the clients. Where were they accessing services? Were they accessing services? This in particular was a big issue — not only how we could get our systems to accommodate this, but dealing with issues such as Health Insurance Portability and Accountability Action (HIPAA) and confidentiality and providing different levels of users different access to the data.

Finally, we had a limited capacity to perform analytics. We knew there were organizations who could and would do this better than we could. There were organizations who did this as their business; we identified this as crucial to bringing up a successful program.

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