ACOs and the Future of Healthcare
Source: Executive Insight – May 2, 2011
By: Ron Wince, Guidon Performance Solutions
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ACOs have the potential to improve quality while reducing costs, and business intelligence will be important to the success.
With the new healthcare reform legislation, healthcare leaders are under fire to determine the best way to move forward and transition to an Accountable Care Organization (ACO). ACOs were developed a few years ago to coordinate the provider and payer chain so care is better coordinated and more seamless. While there are a few outlined requirements (i.e., must serve a minimum of 5,000 patients; consent to be part of an ACO for at least 3 years; follow a one-sided or two-sided risk model; measure and report more than 65 metrics), the exact model of an ACO has yet to be defined.
In its current definition, we know that from a patient point of view, ACOs should result in higher quality care at a lower cost. For providers and insurance organizations, ACOs may reduce costs and improve quality, as well as well facilitate care to Medicare/Medicaid patients.
The first step for administrators is to formulate the ACO partnership and determine the overall culture. How people work together is sometimes more important than what they will be doing together. With that in mind, organizations can start moving toward the future by considering cultural changes first.
It will need to be established how partners will share the potential savings across the ACO, as well as who will serve as decision makers. Each organization prioritizes and performs differently, which will have to be integrated for the ACO to function at its best. Minute details, such as break policy and appointment reminders, will have to be discussed and agreed upon by all parties in order for the ACO to function seamlessly.
Once the partnership is solidified, administrators can then start designing their ACO by first implementing the supporting infrastructure. For instance, clinical and management staff must be included in leadership and management structures. Additionally, administrators will need to demonstrate evidence-based medicine and establish that their facility is “patient centered,” which still has yet to be defined.
Technology will also have to be evaluated. Hospitals and physician groups will be unable to collaborate as an ACO if they don’t have the same technology. Key questions will have to be asked: How do you choose the best technology? Who is responsible for the IT process and system? How will patient data be shared? These are just some decisions administrators will have to consider when becoming part of an ACO, many of which will affect the operational efficiency of the organization.
Furthermore, ACOs have the potential to streamline processes and functions. Physician groups and hospitals have different billing practices, and by partnering in an ACO, an improved billing process will be essential to success. Other processes that have the potential to improve include patient records, human resources and information technology.
Business intelligence will be important to the success of an ACO. Administrators will be able to use data to learn how they can improve their organizations. In the past, data has been used solely for compliance. In the age of an ACO, there is an opportunity to leverage this data internally. Using this data will require new skills, such as collaborating at all levels and learning on the fly.
In conclusion, ACOs have a potential to improve quality while reducing costs, as well as helping maintain or grow a Medicare/Medicaid patient base. ACOs were initially developed to ensure that patients were receiving the care they need while administrators and physicians are able to manage risks, such as an aging population. There is also an opportunity for providers to garner success with ACOs. For instance, they will be able to better manage the new era of patient care without focusing on how much it will cost their facility. This will ensure that facilities are focused on the care that patients receive.
Whether organization’s support or admonish ACOs, it’s imperative to realize they are the future of healthcare in the U.S. Therefore, it’s essential they build and strengthen the skills necessary to ensure they are able to accommodate the growing needs of patients.
All contents © 2011 Executive Insight. All Rights Reserved.
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