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Blog - After the election: How will new accountable care deals shape up?

By Melanie Evans
Posted: November 16, 2012 - 3:00 pm ET

As my colleagues and I reported this week, the re-election of President Barack Obama eased some of the uncertainty over the future of the Patient Protection and Affordable Care Act.

Hospitals and doctors, state policy makers and federal regulators must now grapple with fast-approaching deadlines, the flood of new rules needed to put the law in action and the immediate threat of the fiscal cliff, as Jessica Zigmond and Rich Daly wrote in this week's magazine. But the election secured a champion of the law in the White House for four more years.
For hospitals and doctors with an accountable care organization—or an interest in the emerging payment model—Obama's second term signaled that Medicare's nearly 1-year-old experiment with ACOs will continue, healthcare executives told me after the election. Some who waited for the outcome of the election may now move to try accountable care as one strategy to prepare to operate with continued cost constraints and an influx of newly insured.

What will they face? Quite possibly a lengthy and intensive process, according to the latest issue of Health Affairs, which included a review of how four early accountable care organizations got, well, organized.

HealthCare Partners, Monarch HealthCare, Norton Healthcare and Tucson Medical Center needed a year to 18 months to negotiate contracts with commercial insurers on the details of financial incentives, performance measures and how to identify patients included in the accountable care organization, said researchers who surveyed four of five ACOs in the Brookings-Dartmouth Accountable Care Organization Collaborative.

The researchers said three factors—executive commitment, strong insurer relationships and experience with performance payments—were consistently cited as those that “contributed to their ability to move forward organizationally and advance the new payment contract.”

Each location also said other factors were needed to successfully run an ACO: health information technology, engaged doctors and the ability to manage care and measure performance.

“The slow pace at which this transition took place for these four sites may be at least in part a consequence of the period of observation—relatively early in the emergence of this new payment model,” the authors wrote. “But even with a strong commitment on the part of providers and payers, substantial effort and time were required to reach a signed agreement. Moreover, all sites planned for annual renegotiation so that the model could adapt to changing circumstances.”

The Brookings-Dartmouth collaborative participants are among a growing number of private market attempts to figure out the legal, practical and financial details of accountable care. Meanwhile, the first group of 32 accountable care organizations under contract with Medicare launched roughly 11 months ago. Medicare named another 115 ACOs in April and July. Medicare's next group of accountable care organizations are scheduled to start on Jan. 1.

You can follow Melanie Evans on Twitter: @MHmevans.
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