ACOs: A common goal, various models

It is abundantly clear that a significant portion of the cost savings predicted by the CBO as a result of health care reform depends on the successful implementation of a myriad of accountable care organizations within the U.S. health care delivery system. Although the models for an ACO may vary in different geographical locations (depending on the service sites available and the degree of integration in place among them presently), all ACOs will share a common coal for success. This goal simply must be the re-engineering of a transformation from a productivity orientation driven by our fee-for-service transactional payment system to a clinical-oriented outcome process driven by a payment system that rewards risk-adjusted high quality and low costs. As we have articulated in prior posts, CHRISTUS Health believes the only health care systems in the U.S. that will survive and thrive long-term will be those that have hardwired high quality and low cost health and wellness services into their delivery systems. This is not an easy task, and will require an intense effort by health care leaders to eliminate the barriers to ACOs that I discussed in last week’s post.

With a common goal, why then will there be different models? The best definition of an ACO I have found thus far was part of a recent brochure that crossed my desk, announcing the first National Accountable Care Organization Summit to be held this summer.

ACOs are provider collaborations that support the integration of groups of physicians, hospitals, and other providers in different ways around the opportunity to receive additional payments by achieving continually advancing patient-focused quality targets and demonstrating real reductions in overall spending growth for their defined patient population. The ACO model is highly flexible and can be organized in a number of ways—ranging from fully integrated delivery systems to networked models within which physicians in small office practices can work effectively together to improve quality, coordinate care and reduce costs. They can also feature different payment incentives ranging from “one-sided” shared savings within a fee-for-service environment, to a range of limited or substantial capitation arrangements with quality bonuses.

It is the hope of the U.S. government, in order to halt the growth of our health care costs, that ACOs will provide a transition from our fee-for-service mentality—paying for volume and intensity—to rewarding providers for enhancing value, which requires improving quality while simultaneously reducing costs.

The degree to which ACOs will be successful yet remains to be seen. But clearly, their goals to incent integration and coordination of care and minimize fragmentation of care are absolutely the right ones and must be achieved if health care reform has any chance of success.