How the ACO model can be successful

by Justin Chang, MD

I think we can all agree — physician, payer, provider, patient, etc. — that the ultimate goal of regulations and reform should be to improve the delivery of healthcare, lowering costs and ultimately, making patients healthier and more satisfied.

Coupled with driving toward the results defined by CMS, this requires some fairly significant changes in how healthcare providers operate — changes which may rightfully make some providers uneasy.

But what many of us may not realize is that hospitals, physicians and payers across the country are already becoming advocates for the types of changes ACOs will require, supporting a shift away from the fee-for-service and silo-type models, even before the regulations go into effect.

At Kaiser Permanente, we’ve been operating under an integrated healthcare delivery model for quite some time by establishing a large, multi-specialty group that is salaried and aligned around organizational objectives. The physicians in our group utilize the same electronic medical records, standardize ordering around similar, evidence-based protocols, and this helps the network monitor groups for performance.

As a result, we’re one of very few emergency departments in the area with decreasing CAT scan rates, while the national trend rises. In the past 2-3 years, we’ve been working to collect even more data to help show that increased utilization, i.e. CAT scans, does not necessarily improve results, and that achieving a drop in these expensive tests does not result in worse results, increased risks, or missed diagnoses.

In my opinion, the ACO model can be successful if these important pieces come together:

  • Collaboration: A wide variety of care providers need to be willing to work together toward a common goal of better results  for patients if the ACO model is going to work.
  • Network support:  In addition, support for the networks behind all these providers — meaning chronic care coordinators, case management, nursing, even dietary — will be especially important.
  • Patient focus: Systems, policies, procedures and protocols must be patient centric, not physician-, hospital- or insurance-centric. That’s my litmus test.

Strip away its definition and you’ll find that ACO means physicians will take care of patients by providing a spectrum of care at a predefined cost, and that better outcomes, not price, will be the true measure of success. And beyond ACOs and how the money flows, the ultimate victory will be physicians partnering with each other, using technology to collaborate and share information, with support personnel who oversee the patient’s overall health and manage the transitions.

Justin Chang is chief of emergency services, Kaiser Permanente, Colorado, and medical director, Exempla St. Joseph Hospital Emergency Department.

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  • Laura Galbreath

    I agree and we need to make sure that traditional silos, like mental health and substance use, must be fully engaged in ACO structures and quality metrics.

  • Ericj

    ACO = HMO. Kaiser has never been focused on the patient, or been “patient centric” This will not work. ACO = atrocious care organization.

    • buzzkillersmith

      ACO=HMO+EHR (electronic health record). I stole that equation from pcp, a very smart poster at this blog.

  • Doc99

    For a somewhat different take, see what happens when Dr. Good becomes Dr. ACO.

  • jenga

    If it walks like a HMO, and talks like a HMO. It’s probably a HMO.

  • John Ryan

    What does “providing a spectrum of care at predefined cost” mean in plain English? If I’m correct, it means “we’re not going to pay you any more, no matter how much you work. But you can make more money by spending less on patient care”. Doesn’t seem at all unethical when you say it your way.

  • Leo Holm MD

    Anytime I see ACOs being promoted, the same erroneous assumptions are made. Ideas like healthcare “delivery” or “making” patients healthier implies an external force. Health is an internal process that is a choice. No one wants to have health thrust upon them by some massive Wal-Mart like system. People who are healthy do not need anything “delivered” to them. Perhaps access to health should be less occult? The thrust of ACOs is capitation (or whatever euphemism they use instead of this word). The people at Kaiser and similar institutions are always barking about ACOs because they pretty much are one. Once they get so large that there is no competition, they will be accountable to no one. There is no way to use ACO and “patient centered” sensibly in the same sentence.

  • Marc Gorayeb, MD

    Funny. Kaiser in Denver. I’m familiar with it. From a very long time ago. Back in the day, they were transferring in patients with potential cardiac issues by private vehicle to avoid the cost of an ambulance, and were ridiculed for it even then.

    • buzzkillersmith

      I worked at Kaiser in CA in the 90s. They did exactly the same thing with the possible MIs and private vehicles.

  • jerry

    This post makes complete sense…….if you leave OUT paragraph 4 and 5…..