What’s the Future of Accountable Care Organizations?

Tuesday, December 22nd, 2015
This post was written by Patricia Donovan

CMS launched its Pioneer ACO program in 2012, designing the initiative for early adopters of coordinated care who tend to be more experienced, have an established care coordination infrastructure, and assume greater performance-based financial risk. Following the departure of several healthcare organizations in 2015 from the Medicare Pioneer ACO program, the Healthcare Intelligence Network asked some industry thought leaders what these actions signal for the remaining Pioneer ACOs, other ACO programs and accountable care organizations in general.

(Laura Jacobs, executive vice president, Healthcare Camden Group) The flaws in the ACO model are becoming apparent as organizations are moving into the second and third years of their profiles, of their contracts. That’s the big challenge for the ACO model in general. The big wins in many cases for the ACOs were in markets where the costs were very high to begin with, and organizations were able to achieve their savings relatively easily. Some organizations weren’t even sure what they did to generate savings. But once you get into the second and third years, it becomes harder and harder to continue to achieve the performance thresholds.

That says that the ACO model in its current form must continue to evolve. We must think about how to get the data, how to deal with patient attribution, and how to manage in an environment where the savings will become increasingly difficult to achieve the further along you get. I see the ACO model as a model that will probably evolve to something else. One of the ideas in the Next Generation ACO is to try and continue to tweak that model. I think we’ll continue to see that on both the Medicare side and the commercial side; to see how this ACO structure continually needs to be modified.

(Paul H. Keckley, Ph.D., managing director, Navigant Center for Healthcare Research and Policy Analysis) CMS is doubling down on ACOs. Look at how CMS has pitted ACOs as part of its future. The ACO has the organizing framework, especially around strong primary care provider organizations. Then, sitting beside it are bundled payments, which become the organizing principle for specialists in hospitals on the inpatient side. It’s a pretty interesting Yin-Yang. All the indications from the hill are that this is the future; this is the track that’s been set for these alternative payments.

I think Laura is right. They’ll keep tweaking the program. They’ve doubled down on it, they’ve added three new programs to the first ones. The ACO is here to stay.

Source: Healthcare Trends & Forecasts in 2016: Performance Expectations for the Healthcare Industry


Healthcare Trends & Forecasts in 2016: Performance Expectations for the Healthcare Industry, HIN’s 12th annual business forecast, pins down the trends destined to impact the industry in the year to come and proposes tactics C-suite executives can employ to distinguish their operations in a dynamic marketplace.


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