Accountable Care: reality or myth?

If you attend seminars or read journals you know that Accountable Care Organizations (ACO) are in our future, or are they?

The model certainly isn't new.  Clinton had similar provider networks in his failed reform proposal and capitation can trace roots back to the late 1800's when lumbermen in Wisconsin paid Bavarian nuns a fixed amount per year to provide health care.  What might be new is the admission by Medicare that the current fee-for-service model is not sustainable and, as a result, the ACO model was placed in the controversial health care reform legislation.

The ACO makes perfect sense.  It promises to provide financial incentives and rewards for hospitals and physicians to better coordinate care, actively monitor quality, and through collaboration lower the total cost of care by eliminating inefficiencies.  One small problem.  For the ACO model to have a significant impact on overall expenditures most, if not all Medicare beneficiaries need to be enrolled.  This isn't something that most politicians want to tackle.  In fact the current proposals being considered allow for voluntary enrollment by seniors with some out-of-pocket saving incentives to encourage them.  This sounds like the always popular gatekeeper HMO.

The ACO might actually gain more traction in the commercial market where employers are seeking alternatives to their expensive benefit plans and an ACO is certainly better than no coverage for employees.

Even with this motivation ACOs have a long road ahead.  Hospitals and physicians need to agree to work together, they need to agree on how revenue and savings will be shared, they need to address evidence-based care models, and they need to invest in the data environment that will allow the tracking of care and costs within the defined population of patients.  This isn't going to happen overnight.

Progressive organizations have already begun to move toward an integrated delivery model and others may see the value in at least deciding to explore the potential.  The clueless will take a wait and see approach that may prove fatal.

The only thing for certain is that the next couple of years will prove interesting.