Provider Enrollment Future, ACO’s Part 1

Posted by admin | Posted in Medical Contracting, Provider Contracting, Provider Enrollment | Posted on 03-12-2010


From time to time it’s our plan to explore provider enrollment issues that lay over the current time horizon. Things that, in the future, may impact what we do and how we do it. Issues that providers and others may find of interests or simply a source of speculation around the water cooler. The Affordable Care Act, hate it or love it, creates a number of programs that will significantly impact the load and direction of future credentialing and contracting work. One area that may have such an outcome is provisions which directs the CMS to encourage the creation of what are called Accountable Care Organizations or ACO’s.

What are ACO’s and how do they work? At it’s core, an ACO is a provider group that works on a basis of the cost and quality of care outcomes delivered to its clients, as opposed to the much more prevalent “fee-for-service” approach. An ACO would assume responsibility for the quality, cost, and overall care of a defined population of Medicare clients. It closely resembles the basic Mayo clinic model, with all relevant medical specialties represented within a single group or association. An ACO would be compensated through an a combination of traditional fee-for-service and financial incentives based on the ACO’s abilities to reduce costs, improve quality, and achieve greater patient information integration and transparency.

More specifically, an ACO must include the following:

  • Sufficient primary care professionals to adequately cover the Medicare beneficiaries under it’s purview;
  • It must have a management structures that include clinical and administrative systems;
  • It requires a delineated and detailed processes to promote evidence-based medicine and patient engagement;
  • It must have an established legal structure allowing it to receive and distribute payments for shared savings;
  • It must agree to participate in the program for a minimum of three years;
  • And as sort of an open ended catch-all, An ACO must demonstrate that it has the ability to achieve the objectives set out by the CMS;

Within today broad array of provider organizations, who would be the mostly likely candidates to quickly form ACO’s and take advantage of the associated financial benefits? From small to large, they are:

  • Virtual Physician Organizations. These are small, independent (often rural) practices that formed loosely organized, virtual organization for reasons of mutual support .
  • Independent Practice Associations (IPA). These groups were originally formed for the purpose of contracting with insurance payors but have often evolved into more closely knit groups currently engage in a wide range of patient quality improvement programs.
  • Hospital based physician organizations which are usually composed of a group of providers from a hospital’s medical staff
  • Multispecialtiy Group Practice. Formal organizations incorporating many medical specialties, typically owned or strongly affiliated with a hospital.
  • Integrated Delivery Systems: A company or non-profit which involves the common ownership of hospitals and physician practices and often incorporate an insurance plan. They typically are share electronic health records, feature a team based approach to patient care and in general have the resources to support a cost effective approach to medical care.

Because of their size and integration the last two are most likely to be the models that will be the early adopters. The first three will need considerable technical and organizational support to implement the systems necessary to qualify as an ACO.

Next: ACO’s Part 2 : How they get paid and the impact on provider enrollment issues.

To take a look at the new health care law in all it’s glory click on the link below

Patient Protection and Affordable Care Act

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