Like many who try to understand healthcare policy, I have begun the job of getting my arms around Medicare’s proposed 429 page rule for today’s buzz word in health care, “Accountable Care Organizations (ACOs).” I need to admit to a bias upfront of having helped to develop and then sell (twice) a health insurance plan based on similar principles. Also, before reading further, you may want to watch two widely circulated brief videos that present unquestioned ACO development in a somewhat irreverent light:
http://www.youtube.com/watch?v=lF8bK7AJyL0
http://www.youtube.com/watch?v=ULy5vjcGuDc
From a March 31st Press Release from the Centers for Medicare & Medicaid Services (CMS): “CMS, an agency within the Department of Health and Human Services (HHS), proposed new rules under the Affordable Care Act (ACA) to help doctors, hospitals, and other health care providers better coordinate care for Medicare patients through Accountable Care Organizations (ACOs). 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 will reward ACOs that lower growth in health care costs while meeting performance standards on quality of care and putting patients first. Patient and provider participation in an ACO is purely voluntary.”
According to the widely respected Deloitte Analytics Institute in an April 4th Health Care Reform Memo: “The ACO is one of several programs in the Accountable Care Act that advance clinical integration and physician-hospital alignment. The common thread running through episode-based payments, value-based purchasing, the medical home, avoidable readmissions, and ACOs is clinical integration in an organized delivery system that is capable of taking risk for results—cost savings, outcomes, and service delivery. The ACO is not for everyone.”
Personally, I believe those of us in rural health need to sit back, take a few deep breaths and put the Program into perspective. As written, ACOs are unlikely to attract much rural participation. Neither ACA nor CMS see it as immediately relevant to all situations or the only model that needs to be tested. As this model further evolves, rural providers need to focus on developing the core competencies related to care coordination and not get distracted by trying to become an early adopter of an urban-centric set of federal incentives.
The current CMS ACO proposal fails to recognize the uniqueness of health care in rural communities. Unlike in most urban communities, there are usually not enough providers in rural communities to support multiple ACOs having closed primary care provider networks competing with each other. Many rural communities are located in areas that will have the potential for overlapping ACOs with multiple urbanbased networks. To retain local access over the long run, rural communities will need local providers to be able to offer their services to these multiple ACOs. CMS needs to develop criteria that support this approach by allowing both affiliated and independent local rural providers to participate in multiple ACOs and requiring ACOs to meet strong access standards.
Here are a few ACO paramount strategic issues from a rural perspective:
How do we promote collaboration between urban and rural while respecting the competitive model inherent in regional ACO development? I believe we need to propose that CMS develop a rural model in addition to their current urban centric model. The current lack of a rural ACO vision is like when CMS introduced the wage index and every MSA got its own index and the rest of the state was thrown into one pot of leftovers. I believe CMS should develop a two step attribution model for costs to ACOs. First, as now proposed, costs would be assigned based on use of primary care physicians. Then a second step would be added–attribute costs among ACOs depending on which specialists predominated with a primary care physician’s patients. This would require specialists to declare a principle ACO affiliation as primary care physicians are asked to do. CMS would also need primary care physicians to declare a primary ACO affiliation for patients where no specialty care was provided.
We need to be concerned how CMS’s proposed model will evolve in commercial insurance markets and/or in future iterations under Medicare. We should anticipate a shift from retrospective to prospective attribution models and how that can lead to steerage of patients away from local care sites and the undermining of the rural safety net. Enforcement of Community Access Standards is absolutely critical to prevent steerage of Medicare beneficiaries and inordinate leverage by Medicare ACO plans over local rural providers.
There is much uncertainty in our country and in our field (maybe too acutely felt in Wisconsin given our own much reported political conflict and uncertainty). While we understand some of the general direction, we don’t know what forms reform will or will not take. We need to encourage all of us in rural health to look to strengthen the core competencies of doing more, better for less. That will be achieved through significantly greater care coordination and population health focused prevention, using a full range of corporate integrated and virtual collaboration models.
Critical Access Hospitals (CAHs) are a valuable safety-net provider for almost 60 communities in Wisconsin and for more than 1,200 communities across the county. If you add in the number of smaller rural hospitals, the number of affected communities that will not have the ACO’s required 5,000 Medicare beneficiaries, let alone the actuarial sound lower limit of 20,000grow even larger.
ACOs are an important part of healthcare reform in America but as currently defined by CMS they are largely irrelevant for most of rural America.
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