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Everything You Need To Know About Accountable Care Organizations (ACOs)

Health Care Reform has brought about significant changes in the healthcare market, arguably some good as well some not-so-good.

One major change is the transformation of how care is delivered. We are experiencing a change in the structure of paying providers for the number of services delivered to paying for improved outcomes and cost efficiency through a variety of models called Accountable Care Organizations (ACO). These models use a combination of technology and data, along with financial incentives to help providers coordinate care and improve clinical outcomes. Medicare was an early adopter, and approximately 423 organizations are participating in the Medicare ACO program. Future Medicare ACO programs will allow Medicare beneficiaries to choose an ACO versus other care models, and may provide a financial incentive to the Medicare beneficiary to do so.

The major national carriers have also made strides adopting ACO strategies within their networks. Transformations of how the providers are delivering care in the ACO world are underway. An emphasis on quality and value of care versus quantity of care is occurring. Providers have access to more patient data with greater frequency, along with tools to analyze and act upon the information. Wellness and prevention along with clinical care programs for chronic and high cost conditions are also a focus in this model. Compensation to providers is based on measurable quality and patient health improvements versus a fee for services provided.

So how is this model an improvement over historical arrangements? The patient is provided with coordinated care through the entire episode of treatment. Redundant testing, for example, is reduced. All providers of care are collaborating on the best course of treatment for that patient right from the first visit. An emphasis on preventive care and management of chronic conditions is also incorporated. Patient satisfaction as well as outcomes are measured. Providers have access to necessary and actionable data generated by the carriers. Collaboration between the providers, facilities, carriers and the patient is fostered. Costs are reduced as the delivery of better care with greater efficiency is achieved. Patients have a better experience and are more engaged.

Each carrier has a version or versions of the ACO model. Expansion of these models will continue for both Medicare beneficiaries as well as employers. Further refinements are likely, and may include incentives for ACO only networks. One item is certain, the transformation of healthcare delivery and reimbursement models will continue, as both the providers and carriers gain experience in payment for performance and alternatives for higher quality patient care.