What is an ACO? How does an ACO work? Workers in the health care industry need to know about ACOs. ACO stands for Accountable Care Organization and they're comprised of groups of doctors, hospitals, and other providers of health care. These medical professionals voluntarily coordinate with each other to provide quality health care to patients on Medicare, Medicaid, and commercial insurance according to CMS.gov.

Do you think ACOs are working? Comment below with "yes" if you believe they are or "no" if you don't think they are. I'm curious to know what your thoughts are on the subject.

If you're a medical provider, you would do this to help your patients get the right care at the best time. Doing this can also help you steer clear of providing services your patients have already received which can consequently prevent other health care errors. When ACOs work effectively in providing good care and while cutting spending, they share the savings.

You can see the obvious benefits of participating in an ACO, which is why the Affordable Care Act (ACA) incentivized this for health care providers. Since 2011, approximately 6 million Medicare beneficiaries have joined an ACO. Combine that with the private sector, a minimum of 744 various health care providers have become ACOs themselves, according to Health Affairs in 2015. As of that date, about 23.5 million Americans were being served by ACO.

https://youtu.be/3rs8kpoXmWw

How does an ACO work?

Now that you know what an ACO is, you also need to know how an ACO works. When the ACA passed into law, it created the Medicare Shared Savings Program. ACOs then provide financial incentives for medical professionals who provide good care. But, ACOs only work if you and the other participating providers do a good job of sharing patient information.

It should be noted that you have to share patient information in a way that doesn't violate HIPAA. You can learn more about how to avoid HIPAA violations here. Under the ACA, every participating ACO must manage the health care for at least 5,000 patients on Medicare for a minimum of three years.

ACOs that provide high-quality health care while also saving money (and that should happen if you're sharing information well) get to keep a chunk of the money they saved. When entering an ACO program, you have a couple of options to choose from:

• Aim for a bigger return at the risk of losing money if you don't meet certain standards
• Get a lower, more attainable goal with no risk of losing money

ACOs and HIT

With one of the main goals of ACOs being to cut costs, you can use meaningful use in Health Information Technology (HIT) to improve patients' self-care. HIT tools, such as Electronic Health Records (EHR) make your patients' information more available to health care providers. This also makes it easier for physicians to communicate patient information so the patient doesn't have to.

ACOs can also use patient-facing tools referred to as "patient portals." These allow patients to see their medical information that has been recorded in the EHR. This way, your patients can check their test results, get educational self-care materials, and more. You can learn more about the features and benefits of our EHR here.

Are ACOs only for Medicare?

This is a common question and the answer is no. ACOs work with Medicare, Medicaid, and private insurance companies. However, there are three different plans in Medicare ACOs.

• Pioneer
• Medicare Shared Savings Program
• Next Generation

While the Next Generation model is similar to the Pioneer model, patients will have different experiences depending on which model they participate in. When health care providers save money in Medicare they get to keep a portion of those savings.

Medicaid ACOs

Medicaid ACOs differ from state to state as their approaches are designed at the state level. Some Medicaid ACOs are similar to Medicare ACOs while others follow a more traditional Medicaid managed-care structure.

Some states that currently have Medicaid ACO plans include Utah, Colorado, Oregon, Illinois, Minnesota, Vermont, Arkansas, New Jersey, Maine, and Iowa. Other states have announced coming out with Medicaid ACO models.

Commercial ACOs

Commercial ACOs have the most variety of all ACOs. People with private health insurance that is part of an ACO should see a drop in the amount they pay for premiums and out-of-pocket costs. This decrease most likely won't be seen immediately. It should also be noted that consumers could see a rise in costs depending on if their provider requires preventative health care or disease management programs.

If you're enrolled in a private ACO, you might also have a change in your network provider. This is because some plans have very specific provider network providers.

What are ACO quality measures?

CMS.gov established ACO quality measures for 2018 and 2019 to make it easier for you and other medical providers to understand. Quality performance measures or benchmarks are certain performance standards an ACO must hit in order to earn points for that specific measure.

The system starts with the 30th percentile and ends at the 90th percentile. In the Shared Savings Program regulations, you will encounter circumstances where the benchmarks are flat percentages. These flat percentages are used to help your ACO get high scores. Once your ACO has a high score, it can earn the max amount of points.

You can see all the points scoring system and quality measures here. Keep in mind that all your "pay-for-reporting" needs to be 100% complete and as accurate as possible.

Are ACOs working?

The results have been mixed.

The purpose of the ACA in 2010 was to stop health care costs from continuing to skyrocket. ACOs are an important part of this. However, ACOs had not saved the government money, according to a report in 2015, five years after the ACA was passed into law. The 333 ACOs in the Shared Savings program and 20 in the Pioneer program reported huge savings of $411 million. However, that was before they took into account paying bonuses. Including bonuses, these ACOs actually had a net loss to the Medicare trust fund of $2.6 million.

However, the Pioneer program in Medicare ACOs did save some money for CMS as it cut spending by 1.2%, according to the New England Journal of Medicine.

Today, many believe ACOs are working very effectively, and some definitely are. That being said, there are a lot of people out there who believe ACOs are just a temporary fix until we can find a more permanent solution.

ACO problems

In order for ACOs to work, they had to make some big changes that required big investments in order to share data seamlessly. These changes frequently included new care coordination and care management systems, and those aren't cheap.

Needing such large investments in the beginning stages meant you could only join an ACO if you had lots of money to begin with. So, once you met Medicare's standards, you could still very well be in financial trouble, according to Kaiser Health News. In fact, you can actually be worse off financially.

What if an ACO doesn't save money?

You've most likely heard the saying, "it takes money to make money." With ACOs, it takes money to save money. But what if your ACO invests money with the hope of improving care and saving money but they don't actually save money? What if you hire more nurse managers or invest in some other type of new care management system that doesn't end up saving you money?

Unfortunately, you might have to eat those costs. And, if you don't meet the quality care and savings standards of the higher-risk option, you may have to pay a penalty.

Fortunately, if your ACO is sponsored by a rural provider, you can apply to obtain payments in advance for the purpose of building the necessary infrastructure to create a high-performance ACO.

If you're going to get in the ACO game, it's imperative you make it work. Below are some tips I've included on how high-performing ACOs achieved success.

How successful ACOs work

We've established that there can be some problems with ACOs. But, some are extremely profitable and work really well. Here are some takeaways from successful ACOs:

• The longer ACOs are in the program, the better they tend to fare. Any time you participate in a new program, it will take some time to understand how to navigate it and make it work for you. This is no different here
• Physician-led ACOs typically outperform hospital-ed ACOs. The reason for this is that bigger companies are more likely to have business incentives that conflict with the program
• Reducing high-skill nursing and in-patient hospital services while continuing with high primary care use has been one of the key factors for ACOs to get good results. ACOs that have shifted focus in these areas have surpassed others in improving quality health care and reducing costs.

But there's more to it than that. Health Affairs interviewed 11 of the 21 most successful ACOs in 2018 to see what made them the best. They found that the highest achieving ACOs had these three things in common:

• Worked to have a "high-value" culture
• Developed population health management programs
• Came up with a process of accountability to make sure performance continues to trend up over time.

Be Innovative with population health management

One of the first things ACOs do is aim to better manage patients that are chronically sick and high cost. Successful ACOs did this. And if you're new to the ACO game, I strongly recommend this as a first step. High-performing ACOs have tried testing different strategies for their staffing models. Some tried placing care managers in community health centers to focus on face-to-face patient management. Others centralized their staff to emphasize telephonic care coordination.

This resulted in many care managers thinking outside the box to improve patients' self care. Some ACOs put procedures in place to educate patients to know the difference in something that can be managed at home vs a situation that requires a hospital visit.

One of the keys to having a successful ACO is being innovative and thinking outside the box. Focus on what you can do to provide better care for patients and help them avoid unnecessary hospital visits and costs.

How do ACOs affect patients?

The goal of an ACO is to provide better care for Medicare patients while curbing rising health care costs. So with the goal of providing better, higher quality, more timely, well-coordinated, patient-centered care comes change in how that care is received.

A common issue for medical patients today is getting uncoordinated treatment. If you're the patient, you already have to schedule the appointments, potentially share test results with your clinicians, and get them to communicate with each other, not to mention deciphering through the various recommendations doctors give you. That's a lot to ask of someone looking for treatment.

The whole point of an ACO is to fix this problem, according to National Partnership. When done properly, your primary care doctor will communicate with the other medical professionals you need to be in contact with. A lot of ACOs actually have personnel that work specifically on coordinating care. This makes things so much easier for the patient.

ACO benefits for patients

There are a lot of benefits for patients in ACOs

• Patients don't have to coordinate visits between doctors
• Clinicians communicate with each other so patients don't have to share information
• Educated patients spend less time and money on hospital visits with better self-care
• Doctors recommend health care specialists for patients to see although patients are still allowed to choose a doctor that's not in their ACO

The downfall here is that many patients, if not most, don't know their provider is part of an ACO. However, an easy way to find out if you're part of an ACO is to simply ask your doctor.

Summary

What is an ACO and how does an ACO work? ACOs are Accountable Care Organizations that consist of doctors, insurance providers and hospitals with the purpose of providing better health care to patients through communication and coordination while saving the health care provider money. If those tasks are accomplished, the government will dole out bonuses to the ACO.

In order to have a successful ACO, you have to do a good job of sharing and coordinating patient information. While not all ACOs save money, the most successful ACOs focus on being innovative.

If you're a health care provider, having a really good EHR can help you achieve these goals in your ACO. Click here to schedule a free demo of our mental health EHR or simply fill out the form below.