In Miami, a new healthcare model the ACO rewards physicians for patient health, controlling costs
After suffering two heart attacks within one month in 1997, Robert Rivera sees a cardiologist regularly, and a nephrologist for an unrelated kidney disorder. But its his primary care physician, an internist, whom Rivera trusts most.
I wouldnt change him for anything in this world, says Rivera, 71, who lives in South Miami-Dade County and works in the financial industry. He sees me every three to four months, and hes been doing this for 16 years.
Rivera, a Medicare beneficiary, coordinates all of his medical care through his internist, who referred all the specialists, and he now receives the kind of comprehensive treatment that he never experienced before the two heart attacks, including regular preventive screenings, management of his blood pressure and cholesterol levels, and convenient access to his doctors.
In concept, the coordinated medical care that Rivera receives is nothing new, containing some of the familiar components of traditional health maintenance organizations, such as reducing unneeded medical procedures and careful selection of providers who will work for pre-negotiated rates.
But Riveras doctor belongs to a group that has applied to become an accountable care organization or ACO a creation of the Affordable Care Act that policy makers say will improve the quality of medical care and lower costs by financially rewarding providers who can demonstrate that they keep their patients healthy at less expense.
The aim is to reform a system in which many healthcare providers physicians, hospitals and insurers have largely failed to coordinate care for patients because they were not paid based on a patients health outcome but instead for each procedure performed, often leading to higher costs and inefficiencies.
In many respects, ACOs resemble HMOs, with the most significant difference for the provider being that payment is tied to patient health and operational efficiency. Patients in ACOs also can see providers outside of their network, unlike HMOs.
HMOs make money by managing healthcare in one of two ways: either they spend less on healthcare than the fixed amount of dollars that they receive per year for each patient, or they limit treatments, visits to specialists and other care through strict review processes.
ACOs will make their money by meeting benchmarks for healthcare quality, focusing on prevention and managing patients chronic diseases while lowering costs with fewer hospital admissions and redundant tests and treatments.
A key point: The more providers keep their patients healthy and out of the hospital, the bigger the bonus the providers are likely to receive.
But if patients undergo unnecessary or duplicate tests and treatments, or fail to take medicines, or dont receive follow up care, then the ACOs will eventually be penalized and share in the losses.
Its an entrepreneurial kind of concept, said Judy Goodman, an attorney who teaches healthcare law at Florida Atlantic University.
Hospitals, physician groups, insurers and even Walgreens have raced to create ACOs, not only for Medicare beneficiaries but for patients with private insurance.
A large specialty physician group also can become an ACO on its own and work with a hospital. In other cases, hospitals are buying up physician practices so they can create their own networks.