Case Study

ACO's: What The Henry Ford Physician Network Can Teach

Source: Accenture

Accountable care organizations (ACOs) are one of the most promising responses to healthcare reform. One of the best examples to date is the Henry Ford Physician Network in Michigan. Here's how much the new group has achieved already—and a sense of how far it has to go.

To be properly recognized as an ACO, an organization must be able to demonstrate a range of well-defined characteristics. To begin with, it must have defined processes for reporting on care quality and costs and for coordination of care. It must have a discrete management and leadership structure for decision-making. There should be a formal legal structure that allows the organization to receive and distribute bonuses to participating providers. The U.S. Department of Health and Human Services' Centers for Medicare and Medicaid Services (CMS) will require that an ACO includes primary care physician (PCP) capacity for at least 5,000 Medicare beneficiaries. The ACO must be able to provide CMS with a list of participating PCPs and specialists, have valid contracts with a core group of specialists, and be able to participate for a minimum of three years. Most healthcare systems have some but not all of the necessary capabilities to function as an ACO.

Although several different organizations can form an ACO, to date most activity has been among hospital systems seeking to form ACOs and payers seeking to redefine their roles in providing ACO support services. Health systems have been able to make decisions quickly and have the funds and resources to build the infrastructure needed for development of physician-led ACOs.

HFPN exemplifies the clinical integration model, where physicians collaborate in a defined network to improve quality and efficiency. Says Dr. Jerome Finkel, president of Internal Medicine Associates of Mount Clemens and one of the first independent physicians to sign up with HFPN: "We recognize that patients, insurers and employers in our region are looking for physicians to lead the way in improving Zealthcare. Clinical integration is a proven model for doing that."

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