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Accountable Care Organizations Could Bring Necessary Changes to Health Care

According to a report issued by the Centers for Medicare and Medicaid Services (CMS), in 2011, beneficiaries with multiple chronic conditions accounted for 93% of Medicare fee-for-service expenditures. That means that two out of three Americans over the age of 65 have multiple chronic conditions. Most of these patients see multiple doctors. Too often,their experience is fragmented, resulting in disconnected care where their health records are not available at the point of care; where they undergo unnecessary duplicate medical procedures; and are constantly asked to fill out the same forms at a new doctor’s office when their information is already located in their digital health record that should be available.
http://www.healthcare.gov/news/factsheets/2011/03/accountablecare03312011a.html

Continuity of care is essential to all patients, especially those with chronic conditions. It is rooted in long-term patient-physician partnerships in which the physician knows the patient’s history from experience and can integrate new information and decisions from a whole-patient perspective. The question is whether or not Accountable Care Organizations (ACOs)  can provide that continuity?

Accountable Care Organizations,(ACOs) are part of the proposed new rules included in the Affordable Care Act,signed into law by President Obama on March 21,2010. The ACO is a network of doctors and hospitals that share responsibility for providing coordinated care to Medicare patients. ACOs create incentives for health care providers to work together to treat an individual patient across care settings – including doctor’s offices, hospitals, and long-term care facilities. Under the proposed ACO rules, the Medicare Shared Savings Program rewards ACOs that lower escalating health care costs, while meeting performance standards on quality of care, and putting patients first. By focusing on the needs of patients and linking payments to outcomes, these delivery system reforms should improve the health of individuals and communities and slow cost growth.

For example, Jane is a diabetic with erratic blood sugar that causes dizzy spells despite her medications. As a result she was often going to the ER. When she joined an ACO, however, she was able to eliminate these trips to the ER, because the ACO coordinated her care among her doctor, a nurse and a diabetes educator with whom she talks daily about diet and exercise. The educator schedules her appointments and works with her on her meal plan. When Jane has a bad day, she contacts the nurse who meticulously goes through her food intake and helps her make better choices.

Patient and provider participation in an ACO is purely voluntary. With baby boomers entering retirement age, health costs for elderly and disabled Americans are expected to soar. ACOs focus on prevention and make providers jointly accountable for the health of their patients, giving them strong incentives to cooperate, avoid unnecessary tests and procedures, and meet quality targets. ACOs do not do away with fee for service, but they create savings incentives by offering bonuses when providers keep costs down and meet specific benchmarks.


ACOs are not a panacea, however, they offer the promise of patient-centered care that incorporates case management, management of electronic medical records, care coordinators and use of data analytic systems to track populations.  This could mean a  healthier future for patients and potential cost savings to Medicare of up to $960 million in the first three years. Although that amount is far less than one percent of Medicare spending it is still a significant number that promises to grow.