Book Excerpt: Are You Ready for an ACO Environment?

Organizations must make every effort to perform a detailed financial plan to establish capital requirements, milestones, and timing to include the following:

• Financial performance
  • Cash flow analysis and coverage
  • Cost analysis
• Future cash flow sustainability
• Projections: level of growth, improvements, staffing, costs, cash flow, etc.
• Market characteristics/fundamentals
• Capital requirements (Significant capital will be required to successfully transform any organization into a medical home or ACO. Organizations must have a detailed financial plan to secure sufficient capital at the most favorable terms.)
• Project panel size insurance coverage (The organization must ensure that it has appropriate levels of malpractice insurance because it will be treating chronically ill Medicare patients.)

Editor's Note: This is an excerpt from the HealthLeaders’ book The Healthcare Executive’s Guide to ACO Strategy. In the wake of healthcare reform, ACOs continue to emerge as the care delivery and reimbursement model of the future. Get the book that provides specifics on incorporating accountable care structure and strategy into your organization, including analysis of the CMS final regulations, so you can enter the ACO era prepared and positioned to succeed.

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