12 Key Issues About ACOs From Don Berwick, Prior to Releasing Proposed Rules

With CMS about to release proposed rules for accountable care organizations, CMS Administrator Don Berwick, MD, spoke about planning for ACOs at the Engleberg Center for Health Care Reform on Feb. 1. Proposed rulemaking for ACOs "will be out very soon," he reported. "I can't tell you what's in it yet, because I guess I'm not supposed to," he said, according to a transcript of his remarks. But in his speech, Dr. Berwick framed the following 12 issues about ACOs.

1. Emphasis on a new direction. ACOs cannot be "the status quo repackaged," he said. "If we get it wrong, that's what will have happened."

2. Focus on the patient. An ACO should "put the patient and the family at the center," he said. "It will honor preferences and values and backgrounds and resources and skills at the individual level and will engage people in shared decisions about their diagnostic and therapeutic options."

3. Focus on teamwork. "Teamwork will now become paramount in the ACO," he said. "Patients won’t have to repeat their stories." Handoffs of patients from one caregiver to another will be particularly crucial. "It’s the handoffs where things tend to go wrong," he said. "It's these boundary places."

4. Shift to value and outcome. Rather than investing in "volume and throughput," as the healthcare system does now, "the ACO will invest in value and outcome," Dr. Berwick said. That means "resources are moved to where they're needed," he said. "And so if there’s a need for a focus on anticipation, resources will go to anticipation. If there’s a need for focus on pattern recognition, resources will go there. If there’s a need for care at home, resources will go home."

5. Reducing unnecessary readmissions. "When we drop the ball and things go wrong, people end up back in the hospital, not at home where they want to be," Dr. Berwick said. "That involves proactivity. It means not waiting for things to happen, but preventing things upstream."

6. Data richness is essential. "Electronic health records will need to be key, and so will search," Dr. Berwick said. "I think an ACO, in my mind, would be a place that scans." He was also concerned about privacy when data is shared between organizations. "What can be shared, what not?" he asked.

7. Defining successful ACOs. "If we're going to use the financial mechanisms of reward for success, we will have to make sure that we know success," he said. "Quality measurement, quality metrics, assessment of the patient's status is the balancing measure to anything we do on shared savings or gainsharing."

8. Preserving patient choice. "The ACO, as written in the law preserves choice," he said. "This is not managed care. This is not Medicare Advantage," he said. "You don’t sign up for this." Patients will be attributed to different ACOs. "How to do that is a tough issue," he said. CMS will decide whether attribution will be retrospective or prospective.

9. Choosing measurements. CMS will pinpoint the number and type of measurements used to assess ACO performance. There needs to be the right balance between process and outcome measurements. CMS will also decide whether to include measures that may be difficult to achieve. "The tougher the measurements get, the fewer may be able to play," he said. "Finding that sweet spot where we're measuring enough to know and protect the beneficiary, and yet measuring with enough personally that we're not excluding people with complexity," he said.

10. Generating capital for ACOs. There will need to be "investment and change," Dr. Berwick mused. "Well, who can invest? Maybe large hospitals can invest. What about a small practice?"

11. Enforcement issues. With regards to antitrust, "[W]e have to maintain integrity of markets and market forces, and not let monopolistic behaviors emerge," Dr. Berwick said.

12. Payments to ACOs.
Dr. Berwick said CMS had to decide whether it would allow shared savings only or add payments that have more financial risk, such as upside or downside risk, partial capitation and full capitation.

Read the transcript of Dr. Berwick's remarks at the Engleberg Center for Health Care Reform.

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