Monday, April 25, 2011

What’s Your ACO Gripe?

In the month since the 429-page proposed rule for Medicare's Accountable Care Organization program has gone public, and with a little more than 8 months remaining until the program starts in earnest in 2012, concerns from observers and interested parties have unsurprisingly piled up, a natural response to a major initiative hailed by its supporters as one of the keys to reducing long-term health care costs at the same time it improves overall health care outcomes.

The newest addition to the chorus of skeptics entered my inbox Friday—a new study out from the George Washington University School of Public Health warns that ACOs may not fully serve Medicare beneficiaries in underserved communities. The report points out that federally qualified health care centers, which currently serve 1.4 million Medicare beneficiaries among their 19 million low-income patients, are not allowed to form ACOs. In addition, the report argues that ACOs will be discouraged from even including health centers in their organization, "because of its prohibition of the assignment of FQHC Medicare patients to ACOs for shared savings purposes." 

The report notes some incentives designed to bolster FQHC participation in ACOs—including an increase in shared savings if an ACO includes an FQHC, and an exemption from some of the requirements related to shared savings thresholds if patients have at least one encounter with a health center. But it concludes that the impact of the rule will "exclude the poorest beneficiaries with the highest health risks," and will discourage hospitals from affiliating more closely with health centers.

Of course, this is the stage in any regulatory process—as CMS solicits feedback to the proposed rule before it finalizes it—when concerns by interested parties are meant to be raised, and hopefully addressed by CMS in some form or another. Texas-based VHA, a network of not-for profit health care providers, for instance, argued in a recent New England Journal of Medicine article that participating providers in ACOs may be underwhelmed by immediate financial results. The American Medical Association, meanwhile, is worried that not all physicians who want to join an ACO will be able to participate.

It's also a good time for would-be ACO players to get up to speed on what those 429 pages will mean for their particular institution, and tomorrow, the American Hospital Association is hosting a members-only town hall where hospitals can can hear from federal regulators and AHA experts on barriers to ACO participation and possible remedies—click here for more information.

In the meantime, I'd like to hear from you, the reader. Email your issue, concern or, pray tell, your unabashed enthusiasm for the proposed ACO rule to, and I'll feature some of the responses in an upcoming column, along with other feedback I've recently received on ACOs.


H&HN Daily

H&HN Daily extends the conversations that readers began in other health care management publications and media. Each daily e-newsletter contains at least two topics with exclusive insights from high-visibility, recognized names in health care. All comments are welcome and may be posted to the blog. Comments may be edited for clarity or length.


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