Why ACOs might not make much of an impact (podcast)

If you’re in the health care world you’ve doubtless heard a lot about Accountable Care Organizations (ACOs) ever since the passage of the Affordable Care Act more than a year ago. I probably receive at least 3 to 5 emails per day pitching ACO webinars, seminars, conferences and consulting services.

Now that CMS has issued hundreds of pages of proposed rules about the organizational and financial details of ACOs, one might logically expect the level of activity to rise even further. Yet my takeaway from my podcast interview with Erik Johnson, SVP at Avalere Health is that the wave may already have crested.

As Erik explains, the rules set the savings targets for ACOs at ambitious levels. Since it’s a voluntary program only the relatively few organizations that are close to achieving the ACO criteria already are likely to become ACOs. Others who’ve expressed interest up to this point may simply say no thanks.

It won’t make life any easier for ACOs trying to achieve the target savings that unlike in traditional managed care, patients will be attributed to ACOs retrospectively rather than assigned or enrolled upfront. The reason for that is the political impossibility of restricting patient choice. But it’s awfully hard to control costs when you’re not even sure who you’re responsible for.

The impact of ACOs beyond Medicare is unclear. Commercial payers often follow Medicare’s lead, but it’s less certain that they’ll do so with a voluntary program.

April 8, 2011

3 thoughts on “Why ACOs might not make much of an impact (podcast)”

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