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ACOs Seen As Tough Sell, Despite Concessions

John Commins, for HealthLeaders Media, October 24, 2011

Even with approving nods for the changes announced last week in the final rules for Medicare accountable care organizations, observers who spoke with HealthLeaders Media say the program will remain a tough sell for most healthcare providers.

"I'm still not optimistic we are going to see a rush to the ACO door," said Michael Regier, general counsel and senior vice president of legal and corporate affairs for VHA Inc., the hospital purchasing group. "For organizations that today are not quite far along the clinical integration route there is still an enormous investment required in infrastructure. Even with the improvement in rules, I don't know that the opportunity for return of capital is going to be sufficient enough to entice folks into this care model."


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Nathan Kaufman, managing director of San Diego, CA-based Kaufman Strategic Advisors, LLC, is blunt. "My advice is to be a fast follower. Let somebody else do this," he says. "If they figure out how to make it work, these people will quit their jobs and become consultants and you can learn quickly from them how to do it."

On Thursday, the Centers for Medicare & Medicaid Services issued the long-awaited final rule for ACOs under the Medicare Shared Savings Program. After facing a barrage of criticism last spring when the proposed rules were made public, CMS backed down on several key points in the final product.

For example, CMS reduced from 65 to 33 the number of performance measures that providers would have to meet, removed the electronic health records requirement, eliminated financial risk for some providers, and switched from retrospective to prospective identification of the ACO patient population.  

John Kelly, MD, managing director of Chicago-based Huron Healthcare, says that still won't be enough to lure many providers off the sidelines.

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2 comments on "ACOs Seen As Tough Sell, Despite Concessions"


Tim Richardson (12/1/2011 at 8:10 AM)
Since patients can directly access any provider, including sub-specialists, under ACOs many will attempt to claim that they are providing "primary care" for certain high-risk populations: Endocrinologists may try to become the primary care provider for diabetics. Physiologists may try to provide "primary care" for older people and Orthopedic or neurosurgeons may try to provide 'primary care" for people with arthritis. Tim Richardson, PT http://www.PhysicalTherapyDiagnsosis.com

Jennifer N (10/25/2011 at 11:18 AM)
Since ACOs are a hard sell, they must prove to be a financially sound opportunity. They should reflect a model that will allow patients to understand that a hospital cares about not just their bottom line, but most importantly, their health. In hospitals, ACOs may be implemented by C-level execs and medical directors...but from the patient perspective, accountable care is delivered through the face of the care [INVALID] the physician. Therefore the physician must represent the ACO movement in a positive light in order for them to be integrated and successful. Many physicians are not yet on board with all ACO models, so providers implementing the models will have to first realize that they need their physicians to be in agreement that this will benefit their patient community. I saw a great video from OptumInsight that explains the importance of physicians being on board with ACOs: http://ignite.optuminsight.com/archive/physician-risk-sharing-video/