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Private Sector ACO Models Rooted in Rugged Individualism

Philip Betbeze, for HealthLeaders Media, September 13, 2011
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This article appears in the September 2011 issue of HealthLeaders magazine.

While the regulators tinker with the rules surrounding the accountable care organization model they’ve put forth to improve healthcare quality and control costs, hospitals, health systems, and their representatives have spent copious amounts of lobbying and public relations energy on helping make sure that tinkering is to their advantage, or, at least, that it doesn’t cost them more to achieve the designation than it will save.

That aside, while CMS’ Medicare ACO regulations are receiving huge attention, many hospital and health system leaders say much of the work on improving the value proposition in healthcare rests on tailored accountability developed locally with employers and payers. Smart organizations, even the relatively few that are planning on participating in the Medicare ACO construct, are seeing the Medicare ACO as a small piece of the changing healthcare business landscape.

In fact, the government seems intent on making the threshold for participation high, possibly so it can prove the concept with organizations that already have many of the systems in place to provide accountable care according to the construct.

That has left many organizations to figure out how to become more efficient and to provide better quality care on their own. If nothing else, the recent rash of mergers, affiliations, and other collaborative deals between hospitals and health systems over the past several months is showing that they’re doing it.

What’s more important is forming strong alliances that will be tied together with technology that is able to better coordinate care, and as a practical byproduct, grab market share. But not every hospital or health system is looking for a partner. Those systems are focusing their efforts on efficiency internally, believing that process improvement is the way to make it on a still-murky expectation of lower reimbursement revenues that are not based on procedures, but on quality and efficiency.

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