Fewer than 15 Percent of Nation’s Hospitals are Planning ACOs for 2013

A nationwide survey of nearly 1,700 hospitals shows that just 13 percent are participating in—or plan to participate in—accountable care organizations in the next year. Locally, Texas Health Resources and North Texas Specialty Physicians were the first to participate in Medicare’s Pioneer ACO model. Last month, Methodist Health System announced it also was forming an ACO, with about 270 independent physicians.

According to a report from The Commonwealth Fund, nearly all (93 percent) of existing hospital ACOs are physician-driven—either created as joint ventures between hospitals and physicians (57 percent) or physician-led (26 percent).

An ACO is a network of healthcare providers willing to be accountable for achieving measurable quality improvements and reduced spending for a defined Medicare population. In exchange, an ACO would share the savings with Medicare. The government hopes the model succeeds and spreads throughout the healthcare system. The goal is to pay physicians and hospitals bonuses or shared savings for delivering better care at a lower cost.

The Commonwealth Fund’s report shows that hospitals already involved with ACOs are making progress in improving coordination of patient care. Most (73 percent) are sharing clinical data, including with primary care practices.

“ACOs aim to provide well-coordinated, patient-centered health care with the goal of achieving the triple aim of improved health, improved patient experiences and lower costs,” said Anne-Marie Audet, M.D., vice president for health system quality and efficiency at The Commonwealth Fund and lead author of the study. “Hospital ACO participation at this early date shows promise, and physicians leading these efforts can help ensure there is appropriate focus on primary care to improve quality and efficiency of patient care.”

Here are some additional findings in the report:

• Fifty-six percent of hospitals participating or planning to participate in an ACO said they had or were pursuing an ACO contract with a commercial payer or self-insured employer. Thirty-two percent were planning to apply for the Center for Medicare and Medicaid Innovation ACO program.

• Although 73 percent of ACO-participating hospitals say they share information across care settings, only 35 percent have the ability to track whether the information exchange has been successful.

• Nearly 85 percent of ACO-participating hospitals have information systems to track how patients use healthcare services, but there is room for improvement in their readiness to manage sicker patients. Only 19 percent reported using predictive tools to identify high-risk, high-cost patients and only 28 percent have plans to use case managers to support the sickest, most costly patients the ACO will treat.

• When looking at financial risk, the survey found that only 50 percent of hospitals participating or planning to participate in an ACO reported that they have the financial strength to accept risk. Fifty-nine percent have stop-loss or reinsurance provisions, and 69 percent have processes in place for monitoring the use and costs of services compared with revenue received or allowed.

“Nearly 2.4 million Medicare beneficiaries are receiving healthcare services from 154 accountable care organizations participating in the CMS and CMMI programs,” said Karen Davis, president of The Commonwealth Fund, in a statement. “As these early adopters take risks and work to make the ACO model a success, it will be crucial to evaluate their progress and challenges so we can refine future policies, share best practices and lessons learned, spread successful innovations, and assure that ACOs are working for patients.”

Click here for The Commonwealth Fund’s full brief.