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5 Secrets to ACO Success

 |  By Margaret@example.com  
   June 29, 2011

Everyone seems to agree that perfect model for an accountable care organization doesn't exist, at least not yet. Industry executives I have spoken to are of the opinion that ACOs will probably be in transition over the next decade as providers test a variety of models to find that sweet spot where quality and cost effectiveness intersect.

In the meantime, they are, for the most part, none too thrilled with the Feds' proposed rules on ACOs.

Still there are certain core competencies – the must haves – that ACOs will need to incorporate into their organizations to ensure that the Centers for Medicare & Medicaid Services administrator Don Berwick's three-part aim is achieved – better care, better health, and lower costs.


ROUNDS: The Real Value of ACOs
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Where: hosted by Norton Healthcare
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Speaking Monday at the National ACO Summit, ACO representatives from advocacy groups, business associations, CMS and health plans revealed the strategies that they believe will separate the successful ACOs from the just so-so ACOs. The overarching theme was that transparency – whether you're talking about incentive payments or clinical leadership – will play an important role in how employers, patients and providers view the ACO.

1.Patient Involvement
"If the ACO is to improve care then the patient has to be involved," stated Debra Ness who is the president of the National Partnership for Women and Children, an advocacy group. Ness suggested that patients should be involved at the beginning of any ACO development to help design the actual model of care. She would even like to see patient participation in the governance of ACOs.


ROUNDS: The Real Value of ACOs
When: August 16, 12:00–3:00 pm ET
Where: hosted by Norton Healthcare
Register today
for this live event and webcast


Ness notes that there is a lot of talk about patient-centered care but right now the system lacks the full transparency that will build trust among patients. She said patient involvement is lacking at the local level but that at the national level there are very active groups that are helping shape national ACO policies.

2. Employer Engagement
"Employers are interested in raising the healthcare bar," said David Lansky, president and CEO of the Pacific Business Group on Health."They are interested in accountability, performance and transforming care." He said ACOs need to demonstrate their value to employers, who want to see quality data that helps them understand how the providers in the ACO are performing. "They want to know how the ACO will drive healthcare improvement for their employees and how savings will be achieved." Lansky added that employers want greater transparency around community pricing, total cost of care information and internal cost data that gives employers the opportunity to access if ACO cost savings are "being achieved at the expense of payers."

3. Physician Buy-in
"I personally don't think you can change physician behavior without developing downside risk for the ACO organization but not at the individual physician level," said Bob Margolis, M.D., managing partner and CEO for Healthcare Partners, a Torrance, Calif.-based medical group. He explained that he is a strong believer that "we can't incentivize individual physicians with downside risk."


ROUNDS: The Real Value of ACOs
When: August 16, 12:00–3:00 pm ET
Where: hosted by Norton Healthcare
Register today
for this live event and webcast


Margolis thinks ACOs needs to have in place the structure and financial oversight to really manage downside risk before trying to implement too much on the individual level. "I don't think you're going to see the physicians shift from fee for service, volume-based medicine to care coordination without the entire ACO being held responsible."

4. High Member Volume
Proposed government regulations call for ACOs to have 5,000 members. Margolis doesn't think that 5,000 members is a sufficient base for an ACO to achieve team-based care that it is coordinated among multiple providers. He believes that to be successful, an ACO needs a strong primary care base, so double or triple that number is necessary before systems of care can be cost-effectively developed and infrastructure costs can be easily shared.

5. Knowledge of True Costs
 
"I'm always surprised by organizations that don't know what it costs for them to provide care to their members. That will be fundamental for an ACO," said Jon Blum, deputy administrator and director of the Center for Medicare at CMS. To help, Medicare will be sharing its Part A, B and D claims data with organizations selected for the ACO program to help them develop a more accurate look at their true costs.


ROUNDS: The Real Value of ACOs
When: August 16, 12:00–3:00 pm ET
Where: hosted by Norton Healthcare
Register today
for this live event and webcast


Blum said cost data is key to developing care models that will really reduce healthcare costs. He added that no one wants to see ACOs reduce costs by skimping on care or endangering the financial stability of the ACO itself.

See Also:
2 ACO Experts, 2 Viewpoints, Too Much to Know
Risk and the ACO
Impact Analysis: Leaders Respond to Proposed ACO Regs
Intelligence Report: The Leap to ACOs
Breakthroughs: The Bridge to ACOs
The Physician's Place in the ACO

Margaret Dick Tocknell is a reporter/editor with HealthLeaders Media.
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