How many patients in ACOs?

Greenbeard

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Jun 20, 2010
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A management consulting firm recently took a look at how many patients in the U.S. are currently served by a relatively new innovation, accountable care organizations. They released their somewhat unexpected findings in a brief called The ACO Surprise.

The rationale for ACOs:
For many of us in the healthcare industry, the real potential game-changer in the Affordable Care Act was not the highly publicized provisions—the creation of insurance exchanges or its embrace of guaranteed issue, community rating, and regulated medical loss ratios. Rather, it was the way ACA opened the door to accountable care organizations (ACOs) in Medicare. Here at last was a development in US healthcare that would shift the focus to delivery and encourage provider organizations to compete on quality and price—something the traditional fee-for-service system has failed at rather spectacularly. We believed—and still do—that as this sort of competition is successfully introduced into the us system, it will inevitably spread, enabling and accelerating a movement toward healthcare that is priced and paid for in terms of value, not volume of services rendered.

Their count of patients served by ACOs:
These three patient [Medicare and privately insured patients in Medicare ACOs and patients in non-Medicare ACOs] groups add up to 25 million to 31 million US patients receiving their healthcare through ACOs—or roughly 10 percent of the population. We would argue that this is remarkably quick growth for a new and complex form of payment and care delivery. but it is really only a fraction of the potential impact these provider organizations can have. The Medicare ACO programs were deliberately designed as a way to create a multipayer care delivery model that could compete in the open marketplace with fee-for-service, and it is reasonable to ask how many people live in markets where an ACO is one of their healthcare choices. The astonishing answer is nearly half of the us population. when we examine the landscape on the level of primary care service areas (PCSAs), 45 percent of the population live in PCSAs served by at least one ACO, with17 percent in a PCSA served by two or more.

And the good news associated with that:
This sort of incompleteness is to be expected in the early years of a complex transformation. And incompleteness has not prevented some of the first commercial payer ACO arrangements from having a significant impact on medical cost trend. The Blue Cross Blue Shield of Massachusetts Alternative Quality Contract achieved a 1.9 percent savings in its first year, while the ACO developed by Blue Shield of California, Dignity Health, and Hill Physicians was able to deliver a zero percent premium increase to CalPERS members in the first year of the ACO. Further, they have catalyzed change on a market-wide scale and that pace of change is only accelerating.

Progress is happening fast.
 
... healthcare that is priced and paid for in terms of value, not volume of services rendered. ..

The Blue Cross Blue Shield of Massachusetts Alternative Quality Contract achieved a 1.9 percent savings in its first year, while the ACO developed by Blue Shield of California, Dignity Health, and Hill Physicians was able to deliver a zero percent premium increase to CalPERS members in the first year of the ACO.

Just as we already knew - ACA will save individuals, businesses and insurance providers.

Cool.
 

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