Accountable Care Organizations

One in four Americans – and two out of three Americans over 65 – have multiple chronic conditions. According to a new report issued by the Centers for Medicare and Medicaid Services (CMS), care for its beneficiaries with multiple chronic conditions accounts for 93% of Medicare fee-for-service expenditures. These patients often receive care from multiple physicians. A failure to coordinate care can often lead to patients not getting the care they need, receiving duplicative care, and being at an increased risk of suffering medical errors. On average, each year, one in seven Medicare patients admitted to a hospital has been subject to a harmful medical mistake in the course of their care. And nearly one in five Medicare patients discharged from the hospital is readmitted within 30 days – a readmission many patients could have avoided if their care outside of the hospital had been aggressive and better coordinated.

Improving coordination and communication among physicians and other providers and suppliers through Accountable Care Organizations will help improve the care Medicare beneficiaries receive, while also helping lower costs.

ACOs create incentives for health care providers to work together to treat an individual patient across care settings – including doctor’s offices, hospitals, and long-term care facilities. The Medicare Shared Savings Program rewards ACOs that lower growth in health care costs while meeting performance standards on quality of care and putting patients first. An analysis of the Medicare ACO regulation suggests that ACOs could share in bonuses as large as $675 million over three years.

But ACOs will only access these bonuses if they successfully triangulate THREE KEY VARIABLES:

1. Develop highly impactful population interventions, driving down avoidable hospitalizations;
2. Target the right interventions against the right sub-populations and care settings, where avoidable hospital admission and readmissions are prevalent;
3. Leverage tools and technologies to allow interventions to be BOTH scalable AND efficient.