Learning more about physician-only ACOs

Learning more about physician-only ACOs

The Centers for Medicare & Medicaid Services (CMS) defines Accountable Care Organizations (ACOs) as “groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients.” The goal of an ACO is to coordinate care, “avoiding unnecessary duplication of services and preventing medical errors.”

There are currently 171 physicians-only groups that make up 30% of the total ACOs. That number has increased from 134 in 2016. Physicians have also joined with hospitals and other facilities to form 324 ACOs, or 58% of the total.

The American Medical Association (AMA) reports that “Of the 432 MSSP ACOs operating in 2016, 31 percent generated shared savings with 45 percent of physician-only ACOs generating shared-savings, compared to only 23 percent of the 226 hospital-based ACOs.” In addition, CMS has launched a new Advanced Alternative Payment Model (APM) for physicians, which “limits downside risk for participating practices while also allowing them to collect a lump-sum bonus previously available only to those who assumed more risk.”

AMA also notes that “Physician-only accountable care organizations (ACO) … have significant flexibility to contract with allied providers to build the ACO’s network as a new enterprise.” The association points out some key takeaways regarding physician-only ACOs, including:

  • Physician-only ACOs have obtained management, information technology, care coordination, and compliance infrastructure thanks to third party vendors accepting contingent payment from a portion of potential shared savings.
  • Health insurers and private equity funded management companies have recognized that a properly supported physician ACO can achieve improved quality and lower costs than independent physicians or mere contracting networks.
  • Experienced ACOs have seen success in early detection/early intervention by developing a stable of allied providers to steer patients to the appropriate sites of care.

Physician-only ACO numbers are on the rise, as independent physicians participating in ACOs are realizing greater benefits in terms of shared savings, improved quality of care, and lower costs.