Consumer choice, performance measurement are top challenges for ACOs

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Meeting accountable care initiatives under the healthcare law is presenting challenges for its accountable care organization participants.

Even though the Centers for Medicare & Medicaid Services relaxed the final performance measures from a proposed 65 to 33, meeting those performance measures is no small feat.

The federal program might not be easy for its Pioneers, who have long been fueled by health plans, California Healthline noted. The new approach will require utilization management functions, such as disease management, complex case management, preauthorization services, specialty referral management and other analytic tools, Lynn Dong, a principal consulting actuary with Milliman, explained. 

Sharp HealthCare, one of the 32 federal Pioneer ACOs, said it already has experience in providing coordinated care and population-based payments, but the San Deigo-based health system--like other Medicare ACOs--faces the challenge of consumer choice.

"I think the real test for an organization like Sharp is not being able to produce quality measures, and it's not bearing risk, it's being able to manage the traditional Medicare population with no limitation on choice," said Robert Berenson, a senior fellow at the Urban Institute.

Unlike HMO models of the past, patients can see any healthcare provider, even outside of the assigned ACO network.

So for providers who signed up for the Center for Medicare and Medicaid Innovation ACO programs, physicians will feel the ripple effect and might feel pressure to keep referrals in network.

"It's quite possible they will be under some kind of pressure within their ACO to keep referrals in-house," Anders M. Gilberg, senior vice president of Government Affairs, Medical Group Management Association, told Medscape. "This is understandable because the ACO's goal is to reduce costs and variations in care delivery, and it's certainly easier to do both these things if referrals tend to remain within the ACO network."

Beneficiaries also can opt out of sharing their health data, another challenge for ACO participants. Pioneer ACOs must analyze historical data and benchmarking to be successful, Dong noted.

"Providers have typically been used to looking at only the services they perform," she said. "We're encouraging organizations to take a bigger-picture view of the full spectrum of medical care, including both inpatient and outpatient physician costs, and then focus on areas where they could potentially employ greater utilization management efforts and initiatives," Dong said.

And perhaps most challenging is the Catch-22 that, over time, more efficient providers will find it harder to gain returns down the road. The potential for gain profits is harder for providers that have been efficient all along, Berenson explained.

Gilberg also said, "This is one of the inherent flaws of the Medicare ACO program. It may well be that over time, an efficient practice or group will find it increasingly more difficult to squeeze cost-saving efficiencies out of the system and therefore fall victim to the law of diminishing returns."

For more information:
- read the California Healthline article
- here's the Medscape article

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