Health reform after the election: ACOs and population health

Much has been written and said about the effect of the election on the implementation of federal health reform initiatives.  The commentariat, including the blogerati and twitterati wings, have focused on the budget battles of the future to come from Capitol Hill, the flurry of regulations to come from HHS, and the last stand of the boys in red in certain state capitals around the country against implementation of health insurance exchanges and Medicaid expansion under the ACA.

I spoke recently about the importance of the Accountable Care Organization law and regulations, and related initiatives being undertaken by the Center for Medicare and Medicaid Innovation (CMMI) at CMS, and the ways in which these initiatives are likely to affect the next phase in the development of the health care system in this country.  I thought I'd share a few of the highlights here.

We have built a system of sick care in the USA, not health care, and the disruptive forces contained in the Affordable Care Act, including the ACO provisions, have the potential power to change our system to a system of health care – by changing the focus, by changing the incentives, by changing the behaviors of both patients and providers.

The goal for all of us in health care these days is to be better integrated with other parts of the system, so that we can do more with less in the future. We all know -- or should know by now -- that we will have to do more with less. The key to future success will be managing patients’ care and its attendant costs over the long term, managing an episode of care that extends beyond an inpatient surgery to encompass pre-admission and post-discharge services, managing a chronic condition with a multidisciplinary approach using medicine, nursing and even social media and game theory to motivate patient behavior modification. We need to move from reimbursement-based medicine to evidence-based medicine.

When the ACA was enacted, folks likened the ACO to the unicorn: Nobody's ever seen one, but everyone knows exactly what it looks like.  Once the ACO regulations were finalized, I called it as I saw it: the ACO is a camel -- a horse designed by committee. And now I see the ACO and related initiatives under the ACA as a camel with its nose in the tent: a disruptive force beginning to change the world as we know it.

When the final ACO rules came out about a year ago, CMS actuaries predicted that there would eventually be about 270 Medicare ACOs -- including large and small organizations and urban and rural organizations -- by the end of three years (we are less than one year in at this point), providing care to up to 2 million Medicare beneficiaries.  We're on track to get there and beyond, with over 150 Medicare ACOs already approved and several hundred more applications queued up for the future. (Keep in mind there are approximately 150 commercial ACOs out there as well – according to an inventory updated this spring by Leavitt Partners.) 

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