Cool reception

Few hospitals embrace model: survey

Not many hospitals were participating or planning to participate in an accountable care organization last year, but among those that were, physicians were front and center in their governance, according to a new issue brief from the Commonwealth Fund. The Commonwealth Fund reported that only about 13% of hospitals surveyed were participating or planning to participate in an ACO; 12% were unsure; and 75% said they were not exploring the model at all.

However, the survey was conducted between May and September of 2011, and the CMS released its final rule on its Medicare shared-savings ACO model in October 2011. This final rule was more warmly received by the healthcare industry than was the proposed rule issued in March 2011.

In the survey, 3.2% of respondents said they were participating in an ACO; 9.6% said they planned to do so. Of this group, 51% said they were participating or planning to participate in a physician-hospital joint venture, and 20% said the ACO would be physician-led, while 18% had hospital-led governance, and 2% were payer-led.

Providers’ swing from pessimism to optimism on ACOs after the release of the CMS’ final rule was notable, said Tom Flatt, spokesman for the American Medical Group Association. “Certainly, we saw a lot of that,” he said. But he added that many AMGA member organizations were already collaborating with private insurers—rather than Medicare or Medicaid—on developing shared-savings programs.

This was true also of the ACO-interested hospitals in the survey, as 56% of them reported actively pursuing ACO contracts with commercial payers. And 32% were pursuing CMS Pioneer ACOs. A far smaller share— only 16.1%—said they were working on a Medicaid ACO, and 14.9% said they were looking to participate in the Medicare shared-savings program.

While 52.1% of the ACO-interested hospitals were working on a basic shared-savings program, 34.3% were developing models combining shared savings with shared risk. More than one-quarter, 27.2%, reported exploring models combining global payment with shared risk, and 26.8% were looking at partial capitation-shared risk models.

The average size of the 213 ACO-participating or ACO-aspiring hospitals was 322 beds. In comparison, among the 1,255 hospitals not exploring the ACO model, the average bed count was 173. In addition, 64% of those interested in the model were part of a health system or multihospital organization, compared with 47% of those in the ACO-uninterested group.

Flatt said early adopters of the ACO model tended to be larger organizations because they have the infrastructure required to make it work. The AMGA, which has more than 400 member organizations, was an early champion of ACOs.

“These sorts of models require a large primary-care side,” Flatt said. “They have to have a large ambulatory component for it to be a viable financial model for any organization.”

The Commonwealth Fund issue brief also noted that, as of this summer, 154 groups were participating in CMS-sponsored ACO initiatives.