COST: A Bit More Explaining about Accountable Care....

We posted this morning a guest post by an attorney about Accountable Care Organizations and physician-hospital integration. Many of our readers are quite familiar with ACOs but for those of you who want to learn a bit more, here are some useful links:

From CQ Healthbeat in April, via the Commonwealth Fund:

April 13, 2009 -- Washington just can't get enough of accountable care organizations (ACOs). Members of Congress are talking about them as a way to save money and increase quality in the U.S. health care system, and the Medicare Payment Advisory Commission (MedPAC) again probed the concept as it relates to Medicare at its April 9 meeting.

An explanation from the folks at the Dartmouth Atlas and Brookings in January (related to a Health Affairs article):

Washington, DC -- Medicare could save money and improve health care quality by providing financial incentives to providers for coordinating patient care through a shared savings program... Research by Elliott Fisher, Mark McClellan, and colleagues demonstrates that such a program, implemented with the establishment of Accountable Care Organizations (ACOs), would benefit patients, payers, and providers. The ACO shared savings concept would eliminate waste, reduce overuse and misuse of care, and support the development of health systems that can deliver high quality, affordable care.

A look at ACOs may fit into the next phase of Massachusetts' health reform, courtesy of the Liz Kowalczyk of The Boston Globe:

The plan would require significant restructuring of the healthcare system, and some of its components would need legislative approval. Primary-care doctors, specialists, hospitals, and home healthcare agencies would have to form so-called accountable care organizations. Patients would choose a primary care doctor to coordinate their care, mostly within the organization. Insurers would pay the accountable care organization a flat yearly per-patient fee to be divided among the providers.

Dr. Lawrence Casalino has done some similar work on what he calls Accountable Care Systems. (He uses the word "system" to convey the fact that such organizations could be composed of multiple organizations working within an ACS -- we blogged about that here) and he and some other experts did a presentation and published papers as part of a New America project on Medicare. In the context of Medicare, Casalino writes:

[B]ecause an ACS would be a relatively large organization, and because it would be responsible or the full range of costs and quality for its patients, it would be possible for Medicare to use a broader and deeper set of measures, including outcome measures, to reward high quality, cost-effective are than is possible for individual physicians, medical groups, or hospitals.

Finally, Kaiser Health News also did a "quick primer," putting the idea within the context of the whole system:

In the existing fee-for-service payment system used by Medicare and most private insurers, doctors get paid more by giving more services, and hospitals make more by increasing admissions. With ACOs, doctors and hospitals would get paid based on their ability to hold down overall costs and meet quality-of-care indicators. In effect, their pay would be based on improving care, not driving more of it.