An Evolving Health Reform Landscape – Part 3 of 4

by Mark A. Ridenour of the Ridenour Group, Consultant to the Ohio Optometric Association

Accountable Care Organizations (ACOs) are health systems, hospital or physician-led, which are charged with the management of the health of a defined population.  Medicare has led with various models, the most popular of which is the Medicare Shared Savings Program (MSSP). Medicare will continue to pay individual providers and suppliers for specific items and services as it currently does under the Fee-For-Service payment systems. Should the ACO achieve lower costs and better quality outcomes than projected, Medicare will share the financial savings with the ACO, which then shares it with its providers.

The Advance Payment Model is designed for physician-based and rural providers who have come together voluntarily to give coordinated high-quality care to the Medicare patients they serve. Selected participants will receive upfront and monthly payments, which they can use to make important investments in their care coordination infrastructure.

The Pioneer ACO Model is designed for health care organizations and providers that are already experienced in coordinating care for patients across care settings. It will allow these provider groups to move more rapidly from a shared savings payment model to a population-based payment model on a track consistent with, but separate from, the MSSP.  A minimum of 15,000 Medicare beneficiaries must be managed in this model versus the  5,000 minimum for the MSSP.

Each of these models will eventually move to a population-based payment model. Population-based payment is a per-beneficiary-per-month payment amount intended to replace some or all of the ACO’s fee-for-service (FFS) payments with a prospective monthly payment.  Recent CMS notices have stated that 154 organizations now participate in all Medicare ACO programs.  Since there is no accreditation, there is no accounting of private ACOs however it is known that most major hospital systems and large physician organizations have these in development with plans to offer to multiple payers.

“An Evolving Health Reform Landscape” is a four-part series.

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