health care

First ACOs named by HHS

Posted 12/26/11

WASHINGTON – No Rhode Island-based hospital systems or physicians groups were selected by the U.S. Health and Human Services on Dec. 19 to be one of 32 health care organizations to participate in the first Pioneer Accountable Care Organization, a test of plans to change the way doctors are paid for Medicare patients.

Accountable Care Organizations, or ACOs, are an effort to move away from fee-for-service payment models under federal health care reform. Rather than a payment for each test or treatment, the ACOs will be given a budget to manage.

The 32 providers were named from 80 applicants; the providers chosen come from a mix of high-cost and low-cost areas, according to Richard Gilfillan, director of the Center Medicare and Medicaid Innovation. The project, set to begin Jan. 1, 2012, is expected to save $1.1 billion over five years in Medicare costs.

The greater Boston area had five participants chosen – including Atrius Health, Beth Israel Deaconess Physician Organization, Mount Auburn Cambridge Independent Practice Association, Partners Healthcare, and Steward Health Care, the for-profit, Boston-based hospital system owned by a private equity firm that is in the process of purchasing Landmark Medical Center in Woonsocket.

In addition to the cluster in Boston, similar groups were chosen in southeastern Michigan, Minneapolis, southern California, and Nevada.

Not surprisingly, Dartmouth Hitchcock ACO in New Hampshire was also chosen; the term ACO was coined by Dr. Elliott S. Fisher, a professor of Medicine at the Dartmouth Medical School and director of Population Health and Policy at The Dartmouth Institute for Health Policy and Clinical Practice. In April, Fisher visited Rhode Island and gave two presentations, one sponsored by Lifespan, the other by the Rhode Island Quality Institute, entitled “Protecting the Medical Commons: Who is responsible?”

Lifespan did not apply to be part of the first group of ACO members, according to Gail Leach Carvelli, media relations manager at Lifespan. “We’re not set up to be an ACO as of yet,” she explained.

Moving forward, however, Lifespan has committed itself to a comprehensive network strategy to align what it called the three poles of health care – payers, patients and physicians – in order to create health care that is more accountable in cost, quantity and outcome, according to Lifespan president and CEO George A. Vecchione. The effort is being led by Dr. Richard Goldberg, senior vice president for Lifespan’s Physician Network Development. The goal is to shift the system from volume to value.

The choice of Steward as an ACO member was very predictable, according to Edward Quinlan, president of the Hospital Association of Rhode Island. “It’s as predictable as the Red Sox collapse or Brady beating Tebow,” he said.

Hospitals are examining every part of their organization, Quinlan continued. “New models and new partnerships are the reality of today’s marketplace. Hospitals are constantly assessing meeting the needs of the community in a financially responsible manner.”

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