Weighing the Pros and Cons of ACOs

Regardless of the fate of federal health reform, accountable care organizations will continue to develop because the current system is completely unsustainable.

These organizations are emerging because of the necessity to shift the unsustainable payment for volume in today’s fee-for-service health care delivery system to one that rewards value. ACOs will be judged on the delivery of quality health care while controlling overall costs. In general, ACOs will usually receive about half of the savings if quality standards are met.

This will necessitate a transformative shift from fragmented, episodic care to care that is delivered by teams following best practices across the continuum. Providers will thus be "accountable" to each other to achieve value (defined as the highest quality at the lowest cost), because they must work together to generate a sizable savings pool and to improve a patient population’s health status.

Why are ACOs empowering to primary care physicians?

ACOs will target the following key drivers of value:

• Prevention and wellness.

• Chronic disease management.

• Reduced hospitalizations.

• Improved care transitions.

• Multispecialty comanagement of complex patients.

Primary care physicians play a central role in each of these categories.

As Harold Miller of the Center for Healthcare Quality and Payment Reform once said: "In order to be accountable for the health and health care of a broad population of patients, an accountable care organization must have one or more primary care practices playing a central role."

In fact, primary care providers are the only type of provider mandated for inclusion in the ACO Shared Savings Program under the Affordable Care Act.

But are ACOs likely to be favorable situations for primary care physicians?

First, let’s consider the pros. Many physicians find that the ACO movement’s emphasis on primary care to be a validation of the reasons they went to medical school. Being asked to guide the health care delivery system and being given the tools to do so is empowering. Leading change that will save lives and improve patient access to care would be deeply fulfilling. There also is, of course, the potential for financial gain. Unlike physicians in other specialties, primary care physicians have many opportunities in ACOs.

On the con side, you are not alone if you feel overworked or burned out, or that you simply do not have the time, resources, or remaining intellectual bandwidth to get involved.

Many have already weathered promises from the "next big thing" that in the end did not work out as advertised. And equal numbers have little capital and no business or legal consultants on retainer, as do other health care stakeholders. Time is stretched tight in many areas of the country that are already feeling the effects of a primary care workforce shortage – and now the ACO model is asking that you take on more responsibility?

But here’s the thing: If primary care physicians do not recognize the magnitude of their role in time, the opportunity for ACO success will pass them by and be replaced by dismal alternatives.

And there are already success stories. Starting with several simple Medicaid initiatives, North Carolina primary care physicians created a statewide confederation of 14 medical home ACO networks. Although the work involved is plentiful, so have been the rewards.

Among them is a renewed empowerment and leverage for their interests when they contract with payers and facilities. In interviews with the networks’ physicians, the consensus is that although much is uncertain, the primary care physicians feel much more prepared to face the changes in health care, having first created the medical home networks that lead to medical home–centric ACOs.

For those primary care physicians who choose to join a hospital, the same pros and cons generally apply. By being on the "inside," employed physicians may actually have more influence to shape a successful ACO that fairly values the role of primary care. However, they may have more difficulty freely associating with an ACO outside of the hospital’s ACO.

Whether you are inside or outside the hospital setting, there is tremendous financial opportunity for primary care providers. Shared savings is based on all costs, including those for hospitalization and drugs. The distribution of the shared savings will be proportional to the relative contribution to the savings. Thus, the percentage going to primary care stands to be considerable.

America cannot afford its current health care system. It is asking physicians to run a new health care system, with primary care at its core. There is a dramatic change of focus, from cost centers in health care to savings centers in health care.

Empowerment is being offered, but primary care must step up in order to enjoy it.

Regardless of the fate of federal health reform, accountable care organizations will continue to develop because the current system is completely unsustainable.

These organizations are emerging because of the necessity to shift the unsustainable payment for volume in today’s fee-for-service health care delivery system to one that rewards value. ACOs will be judged on the delivery of quality health care while controlling overall costs. In general, ACOs will usually receive about half of the savings if quality standards are met.

This will necessitate a transformative shift from fragmented, episodic care to care that is delivered by teams following best practices across the continuum. Providers will thus be "accountable" to each other to achieve value (defined as the highest quality at the lowest cost), because they must work together to generate a sizable savings pool and to improve a patient population’s health status.

Why are ACOs empowering to primary care physicians?

ACOs will target the following key drivers of value:

• Prevention and wellness.

• Chronic disease management.

• Reduced hospitalizations.

• Improved care transitions.

• Multispecialty comanagement of complex patients.

Primary care physicians play a central role in each of these categories.

As Harold Miller of the Center for Healthcare Quality and Payment Reform once said: "In order to be accountable for the health and health care of a broad population of patients, an accountable care organization must have one or more primary care practices playing a central role."

In fact, primary care providers are the only type of provider mandated for inclusion in the ACO Shared Savings Program under the Affordable Care Act.

But are ACOs likely to be favorable situations for primary care physicians?

First, let’s consider the pros. Many physicians find that the ACO movement’s emphasis on primary care to be a validation of the reasons they went to medical school. Being asked to guide the health care delivery system and being given the tools to do so is empowering. Leading change that will save lives and improve patient access to care would be deeply fulfilling. There also is, of course, the potential for financial gain. Unlike physicians in other specialties, primary care physicians have many opportunities in ACOs.

On the con side, you are not alone if you feel overworked or burned out, or that you simply do not have the time, resources, or remaining intellectual bandwidth to get involved.

Many have already weathered promises from the "next big thing" that in the end did not work out as advertised. And equal numbers have little capital and no business or legal consultants on retainer, as do other health care stakeholders. Time is stretched tight in many areas of the country that are already feeling the effects of a primary care workforce shortage – and now the ACO model is asking that you take on more responsibility?

But here’s the thing: If primary care physicians do not recognize the magnitude of their role in time, the opportunity for ACO success will pass them by and be replaced by dismal alternatives.

And there are already success stories. Starting with several simple Medicaid initiatives, North Carolina primary care physicians created a statewide confederation of 14 medical home ACO networks. Although the work involved is plentiful, so have been the rewards.

Among them is a renewed empowerment and leverage for their interests when they contract with payers and facilities. In interviews with the networks’ physicians, the consensus is that although much is uncertain, the primary care physicians feel much more prepared to face the changes in health care, having first created the medical home networks that lead to medical home–centric ACOs.

For those primary care physicians who choose to join a hospital, the same pros and cons generally apply. By being on the "inside," employed physicians may actually have more influence to shape a successful ACO that fairly values the role of primary care. However, they may have more difficulty freely associating with an ACO outside of the hospital’s ACO.

Whether you are inside or outside the hospital setting, there is tremendous financial opportunity for primary care providers. Shared savings is based on all costs, including those for hospitalization and drugs. The distribution of the shared savings will be proportional to the relative contribution to the savings. Thus, the percentage going to primary care stands to be considerable.

America cannot afford its current health care system. It is asking physicians to run a new health care system, with primary care at its core. There is a dramatic change of focus, from cost centers in health care to savings centers in health care.

Empowerment is being offered, but primary care must step up in order to enjoy it.

Regardless of the fate of federal health reform, accountable care organizations will continue to develop because the current system is completely unsustainable.

These organizations are emerging because of the necessity to shift the unsustainable payment for volume in today’s fee-for-service health care delivery system to one that rewards value. ACOs will be judged on the delivery of quality health care while controlling overall costs. In general, ACOs will usually receive about half of the savings if quality standards are met.

This will necessitate a transformative shift from fragmented, episodic care to care that is delivered by teams following best practices across the continuum. Providers will thus be "accountable" to each other to achieve value (defined as the highest quality at the lowest cost), because they must work together to generate a sizable savings pool and to improve a patient population’s health status.

Why are ACOs empowering to primary care physicians?

ACOs will target the following key drivers of value:

• Prevention and wellness.

• Chronic disease management.

• Reduced hospitalizations.

• Improved care transitions.

• Multispecialty comanagement of complex patients.

Primary care physicians play a central role in each of these categories.

As Harold Miller of the Center for Healthcare Quality and Payment Reform once said: "In order to be accountable for the health and health care of a broad population of patients, an accountable care organization must have one or more primary care practices playing a central role."

In fact, primary care providers are the only type of provider mandated for inclusion in the ACO Shared Savings Program under the Affordable Care Act.

But are ACOs likely to be favorable situations for primary care physicians?

First, let’s consider the pros. Many physicians find that the ACO movement’s emphasis on primary care to be a validation of the reasons they went to medical school. Being asked to guide the health care delivery system and being given the tools to do so is empowering. Leading change that will save lives and improve patient access to care would be deeply fulfilling. There also is, of course, the potential for financial gain. Unlike physicians in other specialties, primary care physicians have many opportunities in ACOs.

On the con side, you are not alone if you feel overworked or burned out, or that you simply do not have the time, resources, or remaining intellectual bandwidth to get involved.

Many have already weathered promises from the "next big thing" that in the end did not work out as advertised. And equal numbers have little capital and no business or legal consultants on retainer, as do other health care stakeholders. Time is stretched tight in many areas of the country that are already feeling the effects of a primary care workforce shortage – and now the ACO model is asking that you take on more responsibility?

But here’s the thing: If primary care physicians do not recognize the magnitude of their role in time, the opportunity for ACO success will pass them by and be replaced by dismal alternatives.

And there are already success stories. Starting with several simple Medicaid initiatives, North Carolina primary care physicians created a statewide confederation of 14 medical home ACO networks. Although the work involved is plentiful, so have been the rewards.

Among them is a renewed empowerment and leverage for their interests when they contract with payers and facilities. In interviews with the networks’ physicians, the consensus is that although much is uncertain, the primary care physicians feel much more prepared to face the changes in health care, having first created the medical home networks that lead to medical home–centric ACOs.

For those primary care physicians who choose to join a hospital, the same pros and cons generally apply. By being on the "inside," employed physicians may actually have more influence to shape a successful ACO that fairly values the role of primary care. However, they may have more difficulty freely associating with an ACO outside of the hospital’s ACO.

Whether you are inside or outside the hospital setting, there is tremendous financial opportunity for primary care providers. Shared savings is based on all costs, including those for hospitalization and drugs. The distribution of the shared savings will be proportional to the relative contribution to the savings. Thus, the percentage going to primary care stands to be considerable.

America cannot afford its current health care system. It is asking physicians to run a new health care system, with primary care at its core. There is a dramatic change of focus, from cost centers in health care to savings centers in health care.

Empowerment is being offered, but primary care must step up in order to enjoy it.