ACOs: Revolutionary, or simply an 'HMO in drag'?

Many have criticized ACOs. Could it be we're doing the same thing over and over and expecting different results (the definition of insanity)?

If you're still puzzled by accountable care organizations, you're not alone. To help you make sense of the basics of an idea that is still sketchy, Kaiser Health News put together a primer on ACOs.

"Some people say ACOs are HMOs in drag," Kelly Devers, a senior fellow at the nonprofit Urban Institute, told KHN.
But one of the notable differences is that ACO patients are not required to stay in network.

ACOs will try to perform as well as HMOs by keeping the cost of care down, while avoiding features that gave the HMO control over patient referral patterns, according to Steve Lieberman, a visiting scholar at the Engelberg Center for Health Care Reform at the Brookings Institution and president of Lieberman Consulting Inc. But HMOs also have limited patient options, which ultimately has led to a consumer backlash.

Curiously enough, although the ACO initiative is supposed to launch in January 2012, and CMS is expected to release more detailed ACO rules in a few weeks, already hospitals, physician practices and insurers have jumped to form ACOs.

And just who gets to run the ACO? CMS left it vague, but hospital with access to money are better positioned than physicians to make the initial investment to create such organizations. Insurers also may play a critical role in ACOs, because they have experience tracking patient data, which is an important part of coordinating care and reporting results.

To learn more:
- read the Kaiser Health News FAQ

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