Financial strength not key to starting a successful ACO

A new report issued by the Commonwealth Fund (CWF) finds that, contrary to previous assumptions, dominant market share, employed physicians and financial strength are not essential requirements for a health system to successfully implement an accountable care organization (ACO).

According to CWF, the findings are based on an in-depth analysis of 59 health systems of various sizes, characteristics and regional locations. All organizations were assessed during in-person site visits upon joining Premier’s Partnership for Care Transformation (PACT) Readiness Collaborative, which was launched in June 2010 to help organizations transition to accountable care.

[See also: Taking a close look at an ACO]


"Although much has been written about the potential merits of ACOs, little information exists to help providers understand the capabilities needed to create and participate in an effective model that can constrain healthcare costs while improving quality," said Eugene Kroch, lead author of the report and Premier vice president and chief scientist.


To address the lack of data evaluating the readiness of providers to implement ACOs, Premier developed a “capabilities framework” tool to assess health system progress toward meeting the requirements of this complex delivery and payment model.

[See also: CMS names 27 to shared savings ACO program]

According to Kroch, Premier’s framework includes six core components, including:

  • Patient-centered foundation (greater patient involvement in clinical decisions);
  • Health home (a primary care medical home);
  • High-value network (a set of providers that deliver quality care at an efficient price);
  • Payer partnership (ACO providers working with payers to create financial incentives consistent with providing high-value care);
  • Population health data management (collecting, analyzing and reporting data covering the ACO’s patient population); and
  • ACO leadership (systematic ACO governance and administration).

Ten of the health systems appearing most frequently among the highest and lowest scorers were selected for further analysis. Using information from ACO readiness assessments, the following attributes are among those that did not appear to differentiate high-scoring from low-scoring providers: