Proposed ACO rules stress care coordination

Financial burden would grow

Proposed rules for the creation of Accountable Care Organizations (ACOs) will require participating organizations to provide primary care to 5,000 or more patients and to meet 65 quality standards. Because the new ACOs also will require substantial start-up costs, some experts say it will be a challenge and an opportunity for hospitals.

"ACOs is a concept that would allow our hospitals to participate and get recognized for many things they're already doing well, including coordinating care for purposes of reducing readmissions and eliminating certain hospital-acquired conditions," says Lisa Graberg, MPH, senior associate director for policy at the American Hospital Association in Washington, DC.

The Centers for Medicare & Medicaid Services (CMS) recently released its proposed rules for creating accountable care organizations with a focus on extent of care coordination and treatment of Medicare beneficiaries who are sick and frail. "These are things a lot of our members are already doing, and there's a financial incentive for doing these sorts of things," Graberg says. "Under ACOs, when you drive down costs, you generate additional savings overall for the Medicare program, and then you're eligible to share in that savings with CMS."

Hospitals are better positioned than most providers to form ACOs because many already have several components of continuous care coordination in their systems, she notes. "Also, hospitals and health systems tend to have greater access to capital, and to become an ACO will require a significant investment that CMS estimates at $1.8 million for start-up and first year of ongoing costs," Graberg says. "We've done some internal analysis and hired a contractor, and we think it's actually much more than $1.8 million."

Large physician groups also seem interested in the ACO model, says Beverly Cunningham, MS, RN, vice president of clinical performance improvement at Medical City Dallas Hospital. "CMS did an open-door call in April, and the people who called in and asked the most questions were mostly large physician groups," Cunningham says. "I think hospitals will take this slowly."

Many hospitals now are focused on understanding their own readmissions, particularly in the big three of pneumonia, acute myocardial infarction, and heart failure. They also are putting processes in place that will help reduce them, Cunningham adds. "While hospitals wait to see what happens with the rollout of health care reform, they'll have these processes in place," she says.

ACOs likely will improve the overall coordination of care, reduce duplication, and enhance prevention efforts, says Donna Zazworsky, RN, MS, CCM, FAAN, vice president for community health and continuum care at Carondelet Health Network in Tucson, AZ. "This includes working with primary care providers," Zazworsky says. "We have those pieces in place for diabetes coordination of care, and we're already showing cost savings in being able to coordinate care better in the primary care."

The point of forming an ACO is to provide care in different ways that might improve health care access and efficiency. An example might be Carondelet Health Network's 24-hour, seven-days-a-week telecardiology program that serves rural hospitals, she notes.