Accountable Care Organizations: Networking to Provide Care

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The Accountable Care Organization, or ACO, is an offshoot of the Medicare system. It is an effort to reduce unnecessary spending on unnecessary tests via having a network of providers who can team-up on individual patients: “Accountable Care Organizations (ACOs) are groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients.” [italics] (CMS, para. 1). Often, a patient will have repeated tests at different doctor’s offices, or the test results can take on new significance if the physician is aware of the results of an unrelated test from a different doctor. Basically, an ACO is a group of practices committed to providing patient care at the highest standard while reducing cost to both patients and insurance providers.

The question is, does it work? And, are there any incentives that are contrary to a patient’s best interests when involved in an ACO? It seems that ACO’s primarily contribute positive patient care, and the incentive to go to ACO physicians is voluntary.

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ACO is based around one primary physician
The “captain” of any ACO is a patient’s primary physician. It is this physician who oversees the network of doctors and an individual patient’s case file. However, this is a lot of liability for one practice to handle, and there are inverse incentives that result from this liability. It appears that large practices, and institutions are buying up smaller private practices in order to become the captain of ACO’s in their area. In this way, they are able to control the flow of patients to their own employees, (Gold, para 20). Initially, the purpose of having primary care physicians head up the ACO for any particular patient is because that physician would be the one who is most knowledgeable about the patient’s overall condition. However, if large hospitals are now considered primary physicians, it is possible that the patient might lose the immediacy of their connection with smaller, individual practices.

ACO is voluntary on behalf of physician and patient
According the CMS.gov website, the participation in ACO is voluntary on behalf of both the physician and the patient. Moreover, a patient is not limited to only seeing doctors that are within a participating ACO. Patients are free to choose specialists and practices that are not in the ACO, (CMS), however, after doing so there is a loss of information sharing that could potentially be beneficial to the patient.

Additionally, there are physicians and private practices who are not prepared to jump into ACO’s because of the standardization of equipment and procedures that an ACO requires. Moreover, some private practices wish to remain that way and not be subject to group ordinations. However, the purpose of the ACO is to provide incentives to standardize tests and routines while also limiting unnecessary spending on duplicate testing or unnecessary testing.

ACO’s are a positive contribution to patient care because of the networking aspect that is required of all participating physicians: “ACOs…[give] them financial incentives to cooperate and save money by avoiding unnecessary tests and procedures.” (Gold, para. 10). There are a majority of patients who will prefer to participate in ACO’s in order to streamline their care. However, there will be some patients who will pick and choose their doctors regardless of their affiliations with any ACO. It will be the tendency of all practitioners within an ACO to provide referrals to other practitioners in the ACO. Additionally, the ACO will receive benefits and kickbacks from Medicare for the amount that is saved in preventing unnecessary testing procedures, such as duplicate testing at more than one provider’s office. Overall, ACO’s contribute to patient care and save on financial expenses.

  • Centers for Medicare and Medicaid Service (CMS). (2016). Accountable care organizations. CMS.gov. Retrieved from: cms.gov/Medicare/Medicare-Fee-for-Service-Payment/ACO/index.html?redirect=/Aco
  • Gold, Jenny. (2015). Accountable care organizations, explained. Kaiser Health News. Retrieved from: http://khn.org/news/aco-accountable-care-organization-faq/

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