5 Starting Points for Developing an ACO

Although the regulations for Medicare accountable care organizations created by the Patient Protection and Affordable Care Act have yet to be released, many healthcare providers across the country are beginning to develop infrastructure to support these entities. While the transition from siloed sites of care in a fee-for-service environment to more integrated providers that together care for the overall health of an entire population seems an enormous transformation, here are five more straightforward starting points for developing ACOs.   

1. Develop a large primary care base. In order to qualify for the ACO demonstration project, organizations will need to have provide care for a population of at least 5,000 Medicare beneficiaries. Therefore, it's important that hospitals or physician groups looking to develop ACOs build up their primary care resources and attract patients to these services, says Donald W. Fisher, PhD, CAE, president and CEO of the American Medical Group Association.  

However, once future ACOs meet the minimum population base requirements, they should immediately focus on improving quality and reducing costs, rather than continuing to grow the base.

2. Hire more mid-level providers. A growing physician shortage, especially in primary care, has led to an increased need for mid-level providers such as nurse practitioners and physician assistants. The American Academy of Family Physicians predicts a shortfall of 40,000 primary care physicians by 2020. These clinicians work under the supervision of a physician and are qualified to take on many types of primary care patient visits, increasing the level of access a physician alone could offer. "Utilize NPs and PAs to the top of their license, and think of the physician as the capstone or quarterback of the primary care team," says Dr. Fisher.

Physician assistants and nurse practitioners are already in high demand and that demand is only expected to grow, so hospitals and practices should actively recruit and integrate in these practitioners sooner rather than later.  

3. Put EMRs and disease registries in place.
Fundamental to ACOs is the use of data to drive decision-making. As such, ACOs must have infrastructure in place, including EMRs and disease registries, to extract data, run analytics and use that information to make improvements on care processes and to reduce costs, says Dr. Fisher.

4. Embrace a team-based culture. In order to be successful in ACOs, providers must embrace a team-based approach to care. Not only must primary care physicians embrace mid-level providers, but primary care providers will need to better coordinate care with specialists and hospitals to oversee the entire continuum of care. "The culture that embraces team work and coordination of care will be most successful," says. Dr. Fisher.

5. Develop infrastructure to distribute funds internally. Because the Medicare ACO demonstration involves bundled payments and similar agreements with commercial payors are expected to do the same, an ACO will have to create an infrastructure and develop processes for receiving payments and distributing them among all providers within the ACO, including physicians, hospitals and outpatient service sites.

Additionally, providers in an ACO will be sharing in cost savings produced with CMS, so the organization will need a process for dividing those shared savings. Although the PPACA makes no mention in sharing any of those savings with Medicare beneficiaries, Mr. Speed says it should be considered as the patients are the true drivers of their health.

Learn more about the AMGA.

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