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Accountable Care Organizations

Text of ACO

  • 1. Table of Contents PART I: Introduction, History, ACO Stake holders, Core principles for all ACOs, CMSAnnouncement you-tube clip(Anthony Harding) PART II: Overview of ACO and Key Elements of ACO/Health Reform (Jolly Patel) PART IV: The ACO - Immediate Benefits for Delaware(Anthony Mbirwe) PART V: Conclusion (Jitka Gruntova)

2. Introduction An accountable care organization The ACO is accountable to the(ACO) is a type of payment and patients and the third-party payerdelivery reform model that seeks tofor the quality, appropriateness, andtie provider reimbursements to efficiency of the health carequality metrics and reductions inprovided.the total cost of care for an assigned According to the Centers forpopulation of patients. Medicare and Medicaid Services A group of coordinated health care (CMS), an ACO is "an organizationproviders form an ACO, which thenof health care providers that agreesprovides care to a group of be accountable for the quality, The ACO may use a range of cost, and overall care of Medicarepayment models (capitation, fee- beneficiaries who are enrolled infor-service with asymmetric or the traditional fee-for-servicesymmetric shared savings, etc.). program who are assigned to it. 3. ACO Stakeholders Providers-ACOs are comprised mostly of hospitals, physicians, andother healthcare professionals. Depending on the level of integrationand size of an ACO, providers may also include health departments,social security departments, safety net clinics, and home care services. Payers- The federal government, in the form of Medicare, will be theprimary payer of an ACO. Other payers include private insurances, oremployer-purchased insurance. Patients- An ACOs patient population will primarily consist ofMedicare beneficiaries. In larger and more integrated ACOs, thepatient population may also include those who are homeless anduninsured. 4. History The term Accountable Care Organization Like the HMO, the ACO is an entity thatwas first used by Elliott Fisher Director will be held accountable for providingof the Center for Health Policy Research at comprehensive health services to aDartmouth Medical Schoolpopulation. In 2006 during a discussion at a public The ACO-model builds on the Medicaremeeting of the Medicare Payment AdvisoryPhysician Group Practice DemonstrationCommission. and the Medicare Health Care Quality The term quickly became Demonstration, established by the 2003widespread, reaching its pinnacle in 2009 Medicare Prescription Drug, Improvement,when it was included in the Patient and Modernization Act.Protection and Affordability Care Act. Kaiser Permanente and HealthCare Although the term ACO was not coinedPartners Medical Group are two notableuntil 2006, it bears resemblance to the examples of successful ACO prototypes.definition of the Health Maintenance However, a recent study by the MedicalOrganization (HMO), which rose to Group Management Association (MGMA)prominence in the 1970s.has shown that the implementation ofACOs is one of the toughest challengesfacing the MGMA members today 5. CMS Announces AccountableCare Organization Rule 6. What Is An Accountable Care Organization (ACO)? Consists of providers who are jointly held accountable forachieving measured quality improvements and reductionsin the rate of spending growth May involve a variety of provider configurations, rangingfrom integrated delivery systems and primary care medicalgroups to hospital-based systems and virtual networks ofphysicians such as independent practice associations Has a strong base of primary care, although hospitals areencouraged to participate, because improving hospital careis essential to success 7. ACOs In PerspectiveThink of it like buying a television... A TV manufacturer such as Sony may contract with manysuppliers to build a TV like a Sony, an ACO would bringtogether the different component parts of care for thepatient (primary care, specialists, hospitals, home healthcare, etc.) and ensure that all of the parts work well togetherThe problem today is that patients are getting each part oftheir health care separately they are buying individualcircuit boards, not a whole TV 8. Core Capabilities 9. How Does It Differ From HMOs? The principle difference between HMOs and ACOs is their size HMOs, like most insurance companies, generally have enrollees in the hundreds of thousands compared with as few as 5,000 HMOs function like insurance companies (they bear 100 percent of the risk that the premiums they charge will not be enough to cover all necessary services for their enrollees) while ACOs will bear little or no insurance risk in their first few years 10. Key Concepts The key concepts for ACOs are continuum of the careand quality of the care ACOs in the future will see incentives for providers whokeep costs down and still manage to meet specific qualitybenchmarks, concentrating on prevention of chronicdiseases and efficient disease management Keeping the costs of hospitalizations under control andthen providing quality home healthcare to patients isessential to success 11. ACOs & The PPACA The Patient Protection and Affordable Care Act (PPACA)was signed into law by President Obama on March 23,2010 The PPACAs intent is to ensure that all Americans haveaccess to quality, affordable health care and will create thetransformation within the health care system necessary tocontain costs 12. PPACA Titles I - IIIThe Patient Protection and Affordable Care Act containsnine titles, each addressing an important component ofreform:I.Quality, affordable health care for all AmericansII. The role of public programsIII. Improving the quality and efficiency of health care 13. PPACA Titles IV - IXIV.Prevention of chronic disease and improving public healthV. Health care workforceVI.Transparency and program integrityVII. Improving access to medical therapiesVIII. Community living assistance services and supportsIX.Revenue provisions 14. Title IIIImproving the Quality and Efficiency of Health Care The PPACA will encourage development of new Patient Care Models starting with a new Center for Medicare & Medicaid Innovation to be established within the Centers for Medicare and Medicaid Services 15. Medicare & Medicaid Innovation This new Center for Medicare & Medicaid Innovation willhave the responsibility of research, development, testingand expanding innovative payment and deliveryarrangements ACOs that take responsibility for cost and quality receivedby patients will receive a share of savings they achieve forMedicare 16. Requirements For ACO Status1.A willingness to become accountable for thequality, cost, and overall care of the Medicarebeneficiaries it treats2.Entrance into an agreement with the Secretary of Healthand Human Services (HHS) to participate in theprogram for not less than 3 years3.A formal legal structure that allows the entity to receive& distribute payments 17. Requirements Continued4. The inclusion of primary care professionals that aresufficient for the number of Medicare beneficiariesassigned to the ACO5.Provision to the Secretary of information regarding theprofessionals who participate in the ACO andimplementation of quality and other reportingrequirements 18. Requirements Continued6. A leadership and management structure that includes clinical and administrative systems7. Defined processes that promote evidence-based medicine and patient engagement, reporting on quality and cost measures, and care coordination8. Demonstration that the organization meets patient- centered criteria 19. More About ACOs The ACO initiative was scheduled to launch in January 2012 Right now, a main source of revenue for healthcareorganizations comes from the tests and proceduresperformed on patients in the current fee-for-servicepayment system, but after the creation of ACOs,organizations and providers will get paid for saving morewhile still providing quality healthcare to the patients - theywill get paid for keeping patients healthy and out of thehospital 20. Financial Savings Associated With ACOs The Congressional Budget Office estimates that ACOscould save Medicare at least $4.9 billion through 2019 less than one percent of Medicare spending during thatperiod, but if the program is successful it can beexpanded by the Secretary of Health and Human Services 21. Comparison of Payment Reform Models 22. Cost Considerations For The ACO Predominately large hospital systems and big physiciangroups are pursuing the ACO concept due to the largeinvestment required in healthcare IT and infrastructure ACOs are designed to encourage consolidation amonghospitals and doctors which has also drawn anti-trustscrutiny If an ACO is not able to save money, it would be stuckwith the costs of investments made to improve care, suchas adding new nurse care managers, but would still get tokeep the standard Medicare fees 23. Who Is In Charge Of The ACO? Its flexible can be hospitals, doctors, or even insurers Some regions of the country already have large multi-specialty physician groups that may become an ACO ontheir own, likely by networking with neighboring hospitals In other regions, large hospital systems are buyingphysician practices with the goal of becoming ACOs thatdirectly employ the majority of their providers (becausehospitals usually have access to capital, they may have aneasier time than doctors in financing the initialinvestment required by an ACO) 24. What Does This Mean For You, The Patient? Patients may not even know that they are part of an ACO Doctors will want to refer patients to hospitals andspecialists within the ACO network, however patientswill still be free to see doctors of their choice outside thenetwork Because ACOs will be under pressure to provide highquality care in order to receive financial benefits, patientsshould ultimately r