About 60% of physician practices avoiding ACOs, study finds

The majority of physician practices have not joined an accountable care organization and don't plan to anytime soon, a new study has found. These reluctant medical groups are also less likely to have the resources—electronic health records, care coordinators, formal quality improvement initiatives—to effectively manage the costs and care for chronically ill patients, the study said.

The results, published online in the journal Health Services Research, show that roughly 6 of 10 physician groups have so far avoided accountable care, a proliferating payment model that rewards and penalizes hospitals and doctors based on their ability to meet cost and quality targets. Medicare accountable care efforts, launched in 2012 under the Patient Protection and Affordable Care Act, now include more than 350 organizations. Private insurers have entered into more than 600 accountable care contracts, according to estimates by healthcare consultant Leavitt Partners.

When measured against an index of 25 measures of care management, patient engagement and quality, the physician practices with no plans to join an ACO scored lowest, the study said. Medical groups already under accountable care contracts ranked highest.

One-quarter of survey respondents were in ACOs. The survey included roughly 1,180 medical groups that researchers adjusted to reflect a nationally representative sample. Another 15% planned to join an ACO soon.

“It would have been surprising and extremely disappointing if those already in ACOs had the least capabilities,” Stephen Shortell, a University of California at Berkeley professor of health policy and management and one of the study’s authors, said in an interview.

But that gap in readiness and resources between those that eschew and those that embrace accountable care suggest that widespread and rapid adoption of the payment model is unlikely, Shortell said. “We’re not on the scale ... where that’s going to occur,” he said. Too many medical groups lack the necessary capacity to manage the financial risk of accountable care.

That lack of capacity among such a large segment of physician groups is discouraging if accountable care succeeds at slowing health spending while improving quality, Shortell said.

It’s too soon to tell if that’s the case. Medicare ACOs met rudimentary quality goals for the first year, but were not required to show progress. Meanwhile, ACOs achieved mixed results on efforts to control health spending.

Shortell and co-authors Sean McClellan, Patricia Ramsay, Lawrence Casalino, Andrew Ryan and Kennon Copeland said success among early adopters could help encourage groups not in ACOs to invest and prepare for the change. The demands on ACOs are significant.

“Early formative evaluations of pilot sites highlight the challenges of building capabilities in electronic health-record functionality, predictive analytics, data collection reporting and analysis, care management, physician and patient engagement, and the key roles played by culture and leadership,” they said.

ACOs also face a dilemma in how to fairly divvy up financial bonuses from successful efforts, an unrelated commentary in the Journal of the American Medical Association recently noted.

Doctors may exit ACOs that fail to account for physicians’ contributions and challenges toward meeting ACO goals, the authors wrote.

The Shortell study found other differences between physician practices inside and outside ACOs.

Medical groups already in accountable care were more likely to have 100 or more doctors and were less likely to be owned by a hospital. That may be because of financial incentives under accountable care to reduce, when possible, costly hospital admissions, the study said. “Our findings also suggest that those practices owned by hospital and health systems may be reluctant participants given that the new value-based payment models are likely to adversely affect hospital admissions and financial viability.”

Follow Melanie Evans on Twitter: @MHmevans