Accountable Care Organizations Basics: Kory Razaghi
ACOs (Accountable Care Organizations ) are one of the major topics of discussion in health management circles.
(Kory Razaghi) This model is designed to offer doctors and hospitals financial incentives to extend comprehensive health programs to Medicare patients. It is looking to strike a balance between improving quality of care while reducing costs. In fact the Congressional Budget Office estimates that ACOs could save Medicare at least $4.9 billion through 2019. Even if this seems marginal (as it corresponds to less than one percent of Medicare spending during that period), it would serve as the foundation for the deployment on a grander scale.
This is achieved by improving workflow (on a network scale), information and avoiding waste. And those that save money and meet quality targets would keep a portion of the savings. The focus is on managing a patient's health trajectory, prevention and careful management of patients with chronic diseases. The goal is to reward all the constituents intrinsically involved to keeping patients healthy and out of the hospital.
Many initiatives across the country have been contemplated, launched and spearheaded by a phalanx of consulting organizations despite the dearth of information. The Centers for Medicare & Medicaid Services is expected to release detailed rules on ACOs shortly.
What is an ACO?
According to Kory Razaghi (Chief of Aptus Advisors, Inc.) an ACO is a network of doctors and hospitals that share responsibility for providing care to patients by bringing together the requisite care component to the patient: this would encompass primary care, specialists, hospitals, home health care, etc. - in an organized and streamlined manner. In the new law, ACOs would agree to manage all of the health care needs of a minimum of 5,000 Medicare beneficiaries for at least three years.
A patient may not even know that it is part of an ACO, and would certainly not be required to stay "within the network". While it is often compared to health maintenance organizations (HMOs)
The bottom line is that doctors would receive a fee for service together with bonuses when meeting costs containment and quality of care standards. ACOs will invariably end up engaging in sophisticated risk analysis requiring a greater understanding of risk and morbidity analysis.
Several large health insurers, including Humana, United Healthcare and Cigna, have announced plans to form their own ACOs. Insurers, on the other hand, say they can play an important role in ACOs because they track and collect data on patients, which is critical for coordinating care and reporting on the results. Hospitals, on the other hand, may have the upper hand in financing the initial investment required by an ACO.
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