Laura is the editorial director of The American Journal of Managed Care® (AJMC®) and all its brands, including The American Journal of Accountable Care®, Evidence-Based Oncology™, and The Center for Biosimilars®. She has been working on AJMC® since 2014 and has been with AJMC®'s parent company, MJH Life Sciences, since 2011. She has an MA in business and economic reporting from New York University.
Despite their large and growing reach, accountable care organizations (ACOs) are still learning how to manage their populations and are slowly accepting more financial risk, according to the results of the Annual ACO Survey from the National Association of ACOs and Leavitt Partners.
Despite their large and growing reach, accountable care organizations (ACOs) are still learning how to manage their populations and are slowly accepting more financial risk, according to the results of the Annual ACO Survey from the National Association of ACOs (NAACOS) and Leavitt Partners. The results were published online in the Health Affairs Blog.
The survey had gathered responses from one-fourth of all ACOs (n = 240) in the country, and 78.1% of respondents were Medicare ACOs, although this type of ACO only accounts for 59.7% of all ACOs in the Leavitt Partners’ database. For other characteristics, such as region, size, and organization structure, the respondents were reflective of the overall ACO population.
“With more than 32 million patients receiving care from ACOs nationwide, ACOs are now an important part of the American healthcare landscape, and the need to understand them better is becoming increasingly more important,” Andrew Croshaw, CEO of Leavitt Partners, said in a statement.
The vast majority (90%) of ACOs are still in at least 1 contract with upside-only shared savings, but they are starting to take on more risk. Half of ACO respondents also have at least 1 contract with downside risk, and the survey found that 47% are pursuing arrangements with shared savings/shared losses and 38% are pursuing a capitation arrangement.
Currently, physician-led ACOs are less likely to be in a 2-sided shared savings contract with only 28% currently in such a contract compared with 48% of hospital-led ACOs. However, physician-led ACOs are getting ready to change that. The survey found that more than half of these ACOs are planning to adopt a contract with downside risk.
ACOs looking to take on more risk are planning to start in a shared savings/shared losses contract in 10 months, on average, and in a capitation contract in 17 months on average. But, there are still ACOs who are concerned they will never be ready to assume downside risk.
The greatest challenge that ACOs cited was their ability to reduce spending, and they indicated in their survey responses that as they adopt more financial risk, they are unsure how to manage costs. Their top priority for 2017 was to reduce costs, followed by engaging physicians, improving data analytics and reporting, and better managing chronic conditions.
The authors noted that as ACOs look to take on more risk and overcome their stated challenges, there are opportunities for CMS, policy makers, researchers, and stakeholder organizations to study ACOs and support the movement by identifying program modifications, such as revisions to risk adjustment and the reduction of regulatory burdens.
“There are many opportunities to support the ACO movement, especially among policy makers and researchers,” said Clif Gaus, ScD, president and CEO of NAACOS. “Everyone wants value-based care, but in order to do that we need to support, learn, and continuously improve. We’re all learning. Let’s do that together.”