The fragmented and independent pieces that make up our healthcare system can bring unimaginable pain to the patients. From doctors, hospitals and labs to phamarcies and health insurance companies, there has been widespread recognition that a lack of coordination hinders people getting healthy in a timely manner.
Under the healthcare reform legislation, ACA, pilot programs for Accountable Care Organizations (ACO) were authorized. The organizations would consist of a collection of providers brought together and accountable for the overall care of the patient. Essentially, it would be harder for one set of providers (doctors or hospitals) to pass the buck when patient care falters. The primary motivator for the improved accountability and coordination are reimbursement rates for services tied to their performance.
In California, Anthem Blue Cross is one of the first insurers to announce the formation of an ACO. Even though the ACO model was orginally proposed for Medicare, Anthem has brought it first to their small and large group plans. It makes sense for the insurance companies to take a lead in the formation of the the ACO’s since they are already negotiating with the different groups.
Anthem’s pilot program will only be available in a couple of counties in California to begin with. Certain individuals and group health plans can enter into one of their health insurance plans developed around the ACO model. At this point, the ACO looks like a hybrid between a traditional PPO and HMO plan. While the plan member has some freedom to select different doctors, there are deductible and copay incentives to sticking with service providers in the ACO.
For instance, in the ACO 20 plan that Anthem is rolling out in certain counties in California, if the member stays with ACO providers there will be no deductible. If the member chooses to see a PPO provider in the network there is a $750 deductible for the member. The next level of choice is for the member to select a non-PPO provider and they would be facing a $1,500 deductible.
There is a similar monetary incentive for the plan member with office visit copays. An office visit with an ACO provider will be $20, $55 for the PPO and 40% coinsurance for non-PPO providers.
It’s obvious that the ACO plan member is rewarded for staying within the system. The other half of the equation is if the ACO providers are really coordinating together to achieve better patient outcomes. Look for more ACO plans to sprout up especially for Medicare beneficiaries. There is no denying the overall concept of the ACO is good, the ultimate test will be in the implementation of the accountable care model.