ACOs to offer better coordinate care for patients

HealthLeaders-InterStudy, a leading provider of managed care market intelligence, reports that provider groups in California, including physician groups, independent practice associations, hospitals and medical foundations, are beginning to shape their role in the anticipated shift towards accountable care organizations (ACO). As a result of health reform, hospitals will be held accountable for the quality of care in their community and are therefore interested in the possibilities that ACOs may offer to better coordinate care for their patients and streamline the reimbursement processes.

According to the recent California Health Plan Analysis, anticipated federal use of ACOs for fee-for-service Medicare is sparking high interest among provider groups and hospitals, leading to partnership discussions. This leaves the door open for the ACO to involve a variety of structural relationships between physicians, hospitals and health plans — a movement that is likely to continue consolidation in the provider community.

"In preparation for the ACO pilot projects, some hospitals are looking to establish medical foundations that will give them the legal authority to work more closely with physician groups to coordinate care," says Chris Lewis, senior market analyst with HealthLeaders-InterStudy. "The ACO development for fee-for-service Medicare means closer care management of many more beneficiaries. Hospitals that have arrangements with physicians that align incentives and allow for coordination of care are well positioned to form an ACO."

Other topics highlighted in the recent California Health Plan Analysis include:

• Commercial insurance carriers re-evaluating their strategies for the individual market in the face of tighter regulation of rates and profits and rising demand for individual insurance products.
• The move by the state's largest drug benefits purchaser to curtail use of expensive brand-name drugs.
• The expansion of managed Medicaid to more seniors and persons with disabilities.

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