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Can Medicaid be a Model for ACO Innovation?

Philip Betbeze, for HealthLeaders Media, July 26, 2013

Part of that is because of scale. While many hospitals and health systems have dipped their toes in the water surrounding ACOs by working on small population groups such as their own employees, 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, says Enders.

Much of the thinking behind Medicaid population health management experimentation shows that hospitals and health systems, as well as state Medicaid payers, are leaning toward a prepayment model.

Otherwise known as capitation, it would require providers to manage toward a certain per-member-per month pay scheme, not unlike many structures that have been attempted in the past. But with today's greater IT capability, Enders says managing toward a number that will be profitable for providers and reduce cost for payers is more achievable, without restricting care.

The prepayment model is "not a big issue if you have 5,000 in your medical home, but if you have 100,000 or 200,000 it's a big deal to stratify those patients who require more or less assistance and it's expensive to build," he says.

"It requires access to lab, pharmacy, and claims data, and linking all that data together around the patient, that investment can range anywhere from $50 million to $200 million. Most don't have that kind of money and can only get it through partnership or contract."

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