Healh Insurers Role in the ACO

As I have noted in previous posts, Accountable Care Organizations or ACOs are being heavily promoted as a way to both increase the quality of care while at the same time lowering its costs. It is a given that ACOs will have to include at least one hospital and a group of physicians. But what about health insurers? Are they guaranteed a place at the table and if they are, what will it be?

How about facilitator? With all of the stakeholders engaged in one form or another with the health plan, the health plan has the potential to be the hub for the ACO should they adopt that role. In a comment on a blog I read recently, the author suggested that an ACO is just an “HMO on steroids”. If that is the case, the health plan is certainly at the center. Unlike the HMOs of the 1990s though, an effective ACO relies on the provider physicians to police and optimize their own work rather than the payors. In a recent article by Mr. Jamie Gooch in Managed Healthcare Executive, he believes the success of an ACO is dependent upon the partners that are engaged. He suggests starting small and working with strong partners that can advance the ‘better-care-at-lower-cost’ model. Using this crawl/walk/run scenario, partners can be selected, and the program can be clinically integrated to optimize the cooperation. Again, the health plan has the opportunity of adopting a leadership role and facilitating these relationships and subsequent outcomes to meet the overall goals of the ACO program.

Additionally, I have talked previously about the critical role of evidence-based medicine in the healthcare reform debate. If we have the information from which best practice can be established, documented and communicated, we all stand to benefit by delivering better healthcare to the patients with greater efficiency and at a lower cost. Again, the health plan can play a key role here. With their reach and access to aggregated clinical information, evidence-based data can be collected, analyzed and made available for the physician and associated clinical organizations to better administer care to the patient. Models that are continuously referenced include Geisinger[3], Mayo Clinic[4] and Intermountain Healthcare[5] – they have integrated care and have created very effective ACOs.

The health plan also stands to be at the center of the operation in that it can recruit and retain members. Gaining membership in commercial health plans is a sales function. Whether they sell to employers or to individual members, membership must be recruited and becomes part of the administrative overhead of the plan. Quasi-governmental plans like Tricare, Medicaid and others may still need to recruit membership. For many ACOs, the initial covered lives are likely to come from the employers within the ACO’s provider panel. For example, a 300 bed hospital with 400 physicians and post acute care facilities may have 5000-6000 employees. If you add dependents, a ready made 10,000 member population is available. This represents lives that likely come out of an existing health plan. This is more than enough to meet the minimum requirements of an ACO. Additional membership may be driven by the community affiliation and demonstrated outcomes.

it will be interesting to track what roles health plans play in the development of ACOs, particularly the major national carriers.