Massachusetts Medical Society: New Tools for Navigating ACOs

New Tools for Navigating ACOs

Vital Signs: October 2013 

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When the concept of accountable care organizations (ACOs) was made an integral part of the Affordable Care Act, there were some who irreverently dubbed the little-known structures “any consultant’s opportunity.”

While ACOs have indeed become a reality for an estimated 14 percent of the U.S. patient population, confusion persists among practices as to what it means to be part of an ACO, whether it’s right for them, and how to go about joining or creating a successful network.

The new MMS Guide to Accountable Care Organizations: What Physicians Need to Know, released in September, aims to answer these questions and provide physicians with a resource to help them navigate the myriad detailed decisions they must make in their journey to become an ACO.

Caring for the Patient You Don’t See

As detailed in the MMS guide, an ACO is a provider-led organization whose mission is to manage the full continuum of care and be accountable for the overall costs and quality of care for a defined population.

The provider composition of an ACO can vary and may include: Integrated delivery systems (including hospitals and health systems), physician group practices/physician organizations, physician hospital organizations, independent practice associations, and virtual physician organizations.

Through the ACO, providers can participate in contracts with a range of payers for management of a patient population, according to the MMS guide. These will include government-sponsored initiatives (e.g., the Medicare Pioneer ACO Model), which will be based on more explicitly defined business and regulatory requirements for participation, and private and commercial payer arrangements, the terms of which will be negotiated and can vary by ACO/payer.

What all of these structures have in common, according to participating physicians, is that they represent a departure from the traditional mindset that a physician’s job is to care for the patient sitting in front of him or her.

“The concept behind population health is not about how well you care for the patient in the exam room; it’s how you care for the patient you don’t see,” said Richard Lopez, M.D., chief medical officer of Atrius Health, one of 32 medical groups around the country that kicked off Medicare’s Pioneer ACO program. “It’s about the patient who doesn’t come in, the patient who is not compliant and lost to follow-up. That’s the part of the population you’re managing and the ones who need outreach,” he said.

And to make this type of population management possible, physicians have to adapt to another fundamental mindset change, which is to work as part of a team. While the primary care physician is generally the leader of this team, ACOs aim to improve quality and reduce costs by more effectively using nurse practitioners, physician assistants, medical assistants, care coordinators, and other clinical professionals in keeping patients healthy.

Initially, this shift can be one of the most challenging for physicians, according to Barbara Spivak, M.D., president of the Mount Auburn Cambridge Independent Practice Association, a 500-physician membership organization as well as a Pioneer ACO.

“Doctors are taught from the beginning that the ultimate responsibility for the care of the patient is theirs, and I think being part of a team is very difficult for some doctors,” she said. “But when the doctors realize how much added value there is to the whole system — and it usually doesn’t take long — that resistance falls away.”

The Real Challenges

The true challenges of working in an ACO, however, are often the ones physicians don’t anticipate. For example, in addition to the ability to adapt to population-health team-based care, organizations need to have patience in waiting for the benefits of their efforts to pay off.

This point has been highlighted by the recent news that 9 of the 32 original Pioneer ACOs have abandoned the program, according to Dr. Spivak. “I think the reason [they dropped out] was clear: They didn’t understand how complicated it is to change physician and hospital behavior, and that to do it all in one year is virtually impossible,” she said. “It really takes three to five years to get to the point where you’re really going to reap the benefits of your work.”

Matthew R. Fisher, J.D., an associate with Worcester-based Mirick O’Connell Attorneys at Law, agreed. “You have to give it time to really see the sea change of culture be implemented. I wish everyone could have given it that time to sink in and see where it leads because it really is trial and error,” he said.

Organizations also need to recognize, according to Dr. Spivak, that “in order to make it work you need to spend money.” A great deal of that investment will go toward technological systems that allow practices to capture and use meaningful data.

In particular, robust information systems (e.g., EMR, secure messaging, patient portals, e-prescribing) are critical components of any clinical integration initiative to enable information exchange and data sharing, according to the MMS guide. In order to meet clinical integration standards, the guide continues, ACOs will often require a system through which physicians can efficiently exchange information regarding patient and practice experience; utilization claims information can be gathered, analyzed, and communicated; and physician compliance and performance can be measured in accordance with physician-authored benchmarks and standards.

Therefore, practices need to factor the lag time of cost savings into their plans for financing these systems, Dr. Spivak said.

The start-up capital required for ACO participation is another driving force of increased physician alignment with hospitals and larger groups, which have access to greater resources.

Choosing the Right Structure

However, finances are just one of many considerations for practices in choosing the right legal structure of their ACOs, which could include the following:

  • Hospitals, physicians, and other providers under common control
  • Providers affiliated through clinical and/or financial integration or a contracting network
  • Large PCP practices or multispecialty physician practices
  • PHOs that are clinically and/or financially integrated
  • Medical foundations
  • Staff model HMOs
  • Contracted groups of suppliers
  • Joint ventures of two or more of the above-listed entities

It’s also important to remember that only by participating in a formal ACO do practices have the legal flexibility to experiment with improving care through increased coordination, noted Robert P. Lombardi, J.D., of Mirick O’Connell. “The [Stark and antikickback] law really stops you from doing many things unless you follow very specific rules or fall within very specific and very rigid exceptions,” he said. “What the ACO has initially provided is a loosening of these restrictions so we can see what collaboration does. It doesn’t change the restrictions and limitations for groups who want to do it outside of the formal ACO context,” he said.

Measuring Success

Despite the challenges, the physicians we spoke with described numerous benefits to becoming part of an ACO.

For example, although Atrius already has a 10-year history of working collaboratively with payers and other health care organizations, Lopez said that its formal ACO contracts, particularly as a Medicare Pioneer, have pushed it to build a structure that has engaged clinical leadership, care managers, and front-line clinicians in strategizing how to improve geriatric care in the ambulatory office, provide better care for high-risk patients in all settings, including skilled nursing facilities, VNAs, and at home.

Further, Dr. Lopez said, “although we were focused on this new population [Medicare PPO patients], many of the techniques, tools, processes, work flows, etc., that we’ve developed to better coordinate and manage the care of these patients, are ones that are applicable to other sets of patients such as in our Medicare Advantage product and our commercial programs,” he said. “It’s had an impact across our whole system.”

Although Atrius did not achieve cost savings in its first year as a Pioneer ACO, Lopez said that it has indeed found success in achieving its triple aim to improve the health of the population, improve the health care experience, and reduce the per capita cost of care — “plus one,” which is to improve the engagement and satisfaction of its clinical and other staff. “Staff who are engaged, motivated, and energized are in a much better position to achieve the triple aim for our patients,” he said.

And better patient care — according to all of the experts Vital Signsspoke with — must be the focus of any practice’s journey to become an ACO.

“The basic principle of doing this is better care,” said Dr. Spivak. “Cost aside, it will help us as physicians do a better job of giving better care to our patients.”

The MMS Guide to Accountable Care Organizations can be downloaded by members at

– Debra Beaulieu

More ACO Resources from MMS

Regional seminars

  • Oct. 10: Peabody Marriott
  • Oct. 29: Delaney House, Holyoke
  • Nov. 5: Beechwood Hotel, Worcester

For more information or to RSVP, contact Lisa Smith at

Education programs

  • Oct. 10: Physician Employment Options in the Health Care Environment
  • Nov. 20: Data Analytics in the World of Accountable Care Organizations

Register at

Other Web resources

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