Ex­ec­u­tives say Cal­i­for­nia's ex­pe­ri­ence with ACOs sug­gests a pro­fil­er­a­tion of ACOs na­tion­wide may raise prices for health­care ser­vices

Modern Healthcare - - Front Page -

Some say ac­count­able care or­ga­ni­za­tions are like uni­corns: They want to be­lieve in them, but they’ve never seen one. Oth­ers say ACOs do ex­ist, and they know this be­cause they’ve seen them in Cal­i­for­nia.

ACOs bring to­gether providers and then re­ward them for tak­ing re­spon­si­bil­ity for the qual­ity of care for their pa­tients while con­trol­ling costs. And ev­ery­one in health­care seems to be talk­ing about them these days.

In Cal­i­for­nia, many providers have been work­ing in ACOs for decades, and they say they can work well—al­though there are pit­falls and lim­i­ta­tions. Cal­i­for­nia ACOs could be mod­els for providers in other parts of the coun­try, but they also of­fer up lessons learned through the years of ex­pe­ri­ence.

“It’s not the type of or­ga­ni­za­tion that de­fines the suc­cess of an ACO, it’s the leader- ship,” said Tom Wil­liams, ex­ec­u­tive di­rec­tor of the Oak­land, Calif.-based In­te­grated Health­care As­so­ci­a­tion, a lead­ing provider qual­ity and pay-for-per­for­mance group. “For suc­cess, there needs to be align­ment be­tween hos­pi­tals and physi­cians.”

Out of the hun­dreds of pages of the Pa­tient Pro­tec­tion and Af­ford­able Care Act, fewer than a dozen are de­voted to ACOs. But those pages are caus­ing a stir in the provider com­mu­nity. That’s be­cause the law gives providers in­cen­tives to start ACOs. The Medi­care Shared Sav­ings Pro­gram, slated to launch in Jan­uary 2012, al­lows providers to set up ACOs that will ac­count for the qual­ity, cost and care of Medi­care fee-for-ser­vice mem­bers for at least three years. The CMS is ex­pected to is­sue reg­u­la­tions on the pro­gram in De­cem­ber or Jan­uary. On Oct. 19, the Na­tional Com­mit­tee for Qual­ity As­sur­ance is­sued a blue­print on ACOs for pub­lic com­ment.

The law also al­lows the new Cen­ter for Medi­care and Med­i­caid In­no­va­tion to eval­u­ate de­liv­ery sys­tem re­forms, in­clud­ing ACOs, by Jan­uary 2011. Medi­care and Med­i­caid pi­lots on ACOs could start ahead of the shared sav­ings pro­gram. Oth­ers are ex­per­i­ment­ing with pi­lot projects around the coun­try.

Half of Cal­i­for­ni­ans

In Cal­i­for­nia, the ACO ex­pe­ri­ence springs from the man­aged-care boom of the past 30 years, ac­cord­ing James Robin­son, di­rec­tor of the Cen­ter for Health Technology at the Uni­ver­sity of Cal­i­for­nia at Berkeley, who wrote a paper on the topic that was is­sued by the In­te­grated Health­care As­so­ci­a­tion last week.

About half of in­sured Cal­i­for­ni­ans re­ceive their care through some type of ACO (See chart). The Golden State has 285 physi­cian or­ga­ni­za­tions with char­ac­ter­is­tics of ACOs. These ACOs run the gamut from Kaiser Per­ma­nente, the man­aged-care gi­ant with 6.7 mil­lion mem­bers, to small-size in­de­pen­dent physi­cian groups. Hos­pi­tals also have

At an ac­count­able care or­ga­ni­za­tion con­fer­ence last week in Los An­ge­les, mem­bers dis­cussed the most ef­fec­tive ways to im­ple­ment ACOs since the pas­sage of health­care re­form this year.

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