New ACO Playbook: Three Touchstones For ACO Viability

Some believe that an ACO’s leadership structure predicts its success. They point to differing savings results for physician-led versus hospital-led ACO shared savings models (MSSPs) to make their case. In particular, they make the argument that future Value-Based Care (VBC) policies should benefit the growth of successful physician-led ACOs, protecting them from policies that force them into Risk.

There are significant flaws to tying ACO structure to the viability or value of the model, however, or in discrediting ACOs which don’t yet produce those savings but may have other important characteristics for the long term. In a more competitive health care environment, the value of ACOs is not only the amount of savings generated, but the model’s ability to grow and expand Value-Based Care. That ability is not just a function of structure, but also of the ACO’s assets. In most hospital-led ACOs, Fee-for-Service incentives certainly continue to reward volume, and hospitals will promote internal referrals to specialty and ancillary services; but these referrals may also result in better coordination of care, clinical decision-making, and more choices for patients. The methodology to determine ACO savings captures none of these nuances.