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Can Medicaid be a Model for ACO Innovation?

Philip Betbeze, for HealthLeaders Media, July 26, 2013

Many hospitals and health systems have experimented with the ACOs concept by working on small population groups such as their own employees, but they don't have the scale to bring the science and technology to the equation. That's where Medicaid might be an ideal proving ground.

ACOs have been with us for a couple of years now, but most hospitals and health systems, if they have experience in them at all, are most familiar with the Medicare Shared Savings and Pioneer programs.

More recently, commercial payer-provider partnerships have become more common, as big-brand health plans are partnering with physician practices and several hospitals in a regional array to construct accountable care organizations that seek to lower healthcare costs and eliminate waste.

Medicaid has been left out of many of the innovations toward accountable care. But perhaps, as the Bible passage says, what was last may be first.

Part of that Medicaid experimentation stems from the fact that providers, including hospitals and physician practices, are cautious. Where things can and will go wrong is in linkages in monitoring patients, especially the highest cost patients who account for the majority of healthcare spending.

"There's a whole revolution going on in that space," says Tom Enders, senior managing director at Manatt Health Solutions. "Those changes [in care protocols] have to be made in advance of the payment model changing."

Because of that, systems that are conservative want to leverage a partner's capability to get into the business without putting themselves all in without a payment model that supports it, Enders says. Aetna and United are most into this, but they have their own prescriptions for how to build commercial ACOs. Most of them involve the health plan doing a lot of the medical management work.

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