Accountable Care Organizations & Collaboration

Accountable Care Organizations, or ACOs, are an exciting component of health care reform. A study by The Commonwealth Fund, entitled The Vermont Accountable Care Organization Pilot: A Community Health System to Control Total Medical Costs and Improve Population Health, defines an ACO as  "a provider organization that takes on responsibility for meeting the health needs of a defined population, including the total cost of care and the quality and effectiveness of services."

As described in the report, the Vermont Health Care Reform Commission (HCRC) spearheaded a pilot ACO program. Their key findings were
a) The ACO cannot exist in a vacuum
b) The working design for an ACO pilot is built on three major principles:
     1) local accountability for a defined population of patients;
     2) payment reform based on shared savings; and
     3) performance measurement, including patient experience data,
         clinical process and outcome measures.
c) ACO pilots need to have threshold capabilities in five areas to get started.
For purposes of brevity here, refer to the Commonwealth Fund Report for further details.

According to an article, Lessons Learned from Vermont on Building Community ACOs,  published May 20th, in HealthLeaders Media, a working design was developed for each ACO pilot that was built on three major principles: Local accountability, payment reform and performance measurement.

In my view, perhaps not surprisingly, payment reform and aligned incentives will be the single crucial element if this model is to work. Getting primary care physicians, hospitals and other continuum of care providers to negotiate who will be the receiver of funds and how those funds will be shared - that's the biggest devil in the details. I believe it can be done, but the spirit of collaboration may need to be born, or re-born, to accomplish this mighty task.