Seems like everyone I meet nowadays is from an accountable care organization. Except they’re not, since the Centers of Medicare and Medicaid Services has yet to issue a rule defining what an ACO will truly be accountable for and how shared savings will work.

Wayne Sass, CIO at Greater Newport Physicians, an IPA in Newport Beach, Calif., didn’t tell me he’s in an ACO when we sat down at HIMSS.  But I can tell you that, thanks to the IPA’s work in an ACO collaborative project, he’s closer than the vast majority of the herd. “There’s a real lack of understanding around that term. It seems a lot of people have different interpretations of what an ‘ACO’ means,” he said. “People who are saying they’re part of an ACO are defining it in their own terms, based on how they’re delivering care today.”

The reason no one should be jumping the ACO gun is that the program has to date been painted in very broad strokes. CMS Administrator Donald Berwick, M.D., said during a HIMSS keynote that a rule is imminent, but the first step CMS will take is releasing a notice of proposed rule-making, which will be followed by a 60-day public comment period. And “imminent” is a word very loosely defined by the federal government. In literature about the ACO program, CMS says it plans to issue an NPRM rule by the fall.

Right now, here’s what CMS lists as requirements for an ACO:

1) Have a formal legal structure to receive and distribute shared savings

2) Have a sufficient number of primary care professionals for the number of assigned beneficiaries (to be 5,000 at a minimum)

3) Agree to participate in the program for not less than a 3-year period

4) Have sufficient information regarding participating ACO health care professionals as the Secretary determines necessary to support beneficiary assignment and for the determination of payments for shared savings.

5) Have a leadership and management structure that includes clinical and administrative systems

6) Have defined processes to (a) promote evidenced-based medicine, (b) report the necessary data to evaluate quality and cost measures (this could incorporate requirements of other programs, such as the Physician Quality Reporting Initiative (PQRI), Electronic Prescribing (eRx), and Electronic Health Records (EHR), and (c) coordinate care

7) Demonstrate it meets patient-centeredness criteria, as determined by the Secretary.

There’s a lot of big “ifs” in here, including what the Secretary will determine is sufficient information about primary care professionals, and how “patient-centeredness" criteria will be determined. And the really sticky wicket, “coordinate care,” is mentioned almost in passing.

Greater Newport and its partner Hoag Memorial Hospital Presbyterian have been part of an ACO readiness collaborative supported by Premier Inc., a hospital alliance. The collaborative comprises more than 20 organizations and is designed to analyze how its members are delivering care today and what they need to do to qualify as accountable care organizations under the standards CMS will establish with an ACO rule. Premier says in releases about the program that the collaboration members “may be” early applicants for ACO contracts.

The IPA and Hoag plan to apply to be an ACO under a Centers for Medicare and Medicaid Innovation program that's based on a partially capitated Medicare model. CMS, Wayne explains, actually has multiple ACO programs, including the CMMI program and the shared savings model under the Medicare fee-for-service program. Berwick has mentioned before that CMMI, which he called the “crown jewel” of the health reform bill, has flexibility under the law to test models different  than the primary shared savings one being established.

Here’s the heads up for any organization thinking it has already got the goods to be an ACO: after more than a year working with the Premier collaborative, Wayne estimates that the Greater Newport/Hoag partnership is still coming up short in terms of capabilities. “We still have between 10 to 15 percent of the work to do,” Wayne said. The No. 1 priority is getting the ambulatory and inpatient systems fully integrated to manage care coordination, but work also needs to be done around predictive modeling, physician profiling and creating personal health records. “There are technological issues we have to address, but we’ve found that there needs to be a lot change management around the concept of coordinated care,” Wayne said.

So we come back around to care coordination, and my sense is that for many providers that’s where the trip will end, at least in the short term. One takeaway from HIMSS was how difficult care coordination can be when trying to execute in a technologically jumbled environment: good luck trying to get independent specialists and low-tech hospices electronically plugged into a plan. And as Sass points out, technology is just one of a host of issues that has to be addressed.

A lot of I.T. leaders seem to be sweating about how shared savings mechanisms will work, but  assuming they have the pieces in place to be an ACO when the switch is flipped. I think that’s a pretty dangerous assumption since it doesn’t take into account the new I.T. and staff investments that likely will be necessary for ACOs, nor the perhaps massive change management task ahead. As Sass noted, some organizations that already consider themselves ACOs think what they’re doing now is providing “accountable” care, but they’re about to be judged by a set of standards that might be entirely different from their own.

Greg Gillespie is the Editor-in-Chief at Health Data Management and can be reached at


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