Healthcare News & Insights

What type of ACO would best fit your hospital?

Accountable Care Organizations (ACOs) use collaborations among healthcare providers to better patient care. But not all ACOs are the same. Here are the different types and how you can use each to make the transition to value-based care. 

465129329ACOs are becoming a popular way for healthcare providers to make the all-important shift to value-based, high-quality patient care. The healthcare industry is evolving quickly and patient-centered care is often emphasized by federal agencies and private insurers.

They can be an effective way to change with the times and keep ongoing costs manageable, but not every ACO may be a good fit for your facility.

A new report has delved into the world of ACOs to analyze the differences between ownership, patient care and structure, according to FierceHealthcare.

Differences and similarities

The researchers found three distinct types of ACOs which include hospital participation, each with their own benefits and drawbacks for policymakers to consider when designing their own ACO:

1. Full Spectrum Integrated

These ACOs handle all aspects of healthcare delivery through it’s collaboration with physician groups, vendors and hospitals. Generally, these ACOs have solid access to revenue and IT infrastructures which give them better opportunities to provide high quality care.

However, the researchers believe that two big issues with this type of ACO are:

  • the administrative burden of coordinating such a large collaboration of partners, limiting the ACO’s ability to adapt or make operational changes, and
  • the reliance on hospitals and inpatient services to drive revenue. Instead these organizations should focus on ambulatory care with an eye to reducing admissions to cut on expenses.

2. Independent Hospital

 These are ACOs with one owner providing direct inpatient services, though not as many as the Full Spectrum model provides in terms of subspecialty services — an advantage since it means their cost structures will generally be lower than the Full Spectrum model. Typically, they also have strong connections with primary care providers (PCPs) and specialists, which allows them to better coordinate low-cost care outside the hospital.

Like the Full Spectrum model, though, the Independent hospital faces difficulties reducing expenditures by limiting inpatient costs.

Independent hospitals without strong ties to PCPs also will be at a disadvantage since they’ll have to contract out low-cost services, as well as specialty services.

3. Hospital Alliance

Very similar to the Independent Hospital model in terms of benefits and challenges, the key difference for Hospital Alliances is that ownership is spread across several owners with at least one partner providing inpatient services. This ACO may also lead to less anti-trust scrutiny in concentrated markets.

The biggest hurdle for these groups: coordinating and effectively utilizing each partner’s different electronic health records (EHRs) and other IT infrastructures.

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