Healthcare Business News

Reform Update: Patients often seek care outside of their ACOs, research shows

By Melanie Evans
Posted: April 21, 2014 - 3:45 pm ET

Medicare accountable care organizations may find the incentive to manage healthcare quality and cost very weak. New research suggests patients frequently seek care outside of the ACOs they're assigned to, and many do not stay within the same ACO from one year to the next.

Researchers analyzed the 2010 and 2011 medical bills for Medicare patients they estimated were assigned to Medicare ACOs starting in 2012. Two-thirds of these patients' outpatient visits to specialists were outside the ACO and one-third of the patients did not receive care from the same ACO over the two years, according to the study by Dr. J. Michael McWilliams, Michael Chernew, Jesse Dalton and Dr. Bruce Landon of Harvard University. The results were published in the Journal of the American Medical Association Internal Medicine.

Hospitals and doctors in ACOs can earn bonuses or see losses depending on how successfully they meet quality targets and control health spending for the patients that Medicare assigns to them. More than 300 ACOs have signed Medicare contracts since 2012 and their leaders say the efforts to better coordinate and standardize care are key to delivering better outcomes at lower costs.

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Patients who seek care outside the ACO, however, make that coordination more difficult. ACOs have cited roaming patients as a challenge to reaching quality and cost goals. Medicare ACOs cannot restrict where patients seek care or use benefit incentives to encourage use of ACO providers, something the American Hospital Association is lobbying to change.

Patients' wider range of providers suggests ACOs “influence may be more limited,” said McWilliams, lead author of the paper and an associate professor of health policy at Harvard. Closer analysis of the data shows additional troubling trends for ACOs. The study found that the high-cost Medicare patients that ACOs typically target for intervention were more likely (68.1%) to seek care from non-ACO specialists. Even among ACOs with a large number of specialists, patients went elsewhere for more than half (54.6%) of specialist visits.

That limited influence may hinder ACOs ability to earn incentives. ACOs may also have less reason to invest in care coordination for chronically ill patients if those same patients will exit the ACO next year, he said. The hospital association is also asking federal officials to allow Medicare patients to voluntarily enroll in ACOs. “Patients will better understand that their care will be coordinated among a group of hospitals, physicians, nurses and other providers that will work together to provide high-quality care,” the AHA said in a letter to Dr. Patrick Conway, acting director of the Medicare Innovation Center.

Interim results for the first organizations to join Medicare's Shared Savings Program were mixed. Of 114 ACOs in the first wave, 29 slowed spending enough to receive bonuses that totaled $126 million.

McWilliams said more data is needed to see whether ACOs were able to better hold onto patients after 2012 through referral networks or by efforts to engage patients.

The researchers also found that Medicare patients within the ACO accounted for a minority (38%) of the outpatient Medicare bills for doctors participating in ACOs. “Thus, at least initially, incentives in traditional Medicare for organizations participating in ACO programs may continue to be largely fee-for-service in nature, particularly for outpatient specialty care,” the study said.

Follow Melanie Evans on Twitter: @MHmevans

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