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Ready, Set…ACO?

by Jonathan Bush, President & CEO

Happy New Year, everyone!  2010 was certainly action-packed, and 2011 promises the same.

I hear a lot of thunder about getting ready for Accountable Care Organizations, acronymically known as ACOs.

This isn’t a crystal ball forecast, but I see hospitals spending tons of capex on new HIT from old-fashioned “software-based” companies, and it seems like the EMR is the new “pavilion.”  I see hospitals buying medical practices using arrangements that are certain to require the hospital to subsidize doctor income.  [For another take: Paul Levy on ACO.]

These two major waves are explained by clients and prospects alike as “readiness for ACO.”

I have three thoughts:

  1. Don’t worry.  We at athenahealth will do our part.  If and when ACO payment models emerge, you won’t need to buy a new “module” from us in order to get payment.  We will go get you that money the same way we are getting you the “Meaningful Use” stimulus payments, the P4P money, and the plain old health care reimbursements that we have always delivered.  The changes to our technology and service needed to accomplish all that will be on us.
  2. Don’t turn blue holding your breath waiting for the big bonus opportunity.  The fundamental underlying principle of an ACO is that you will get a bonus in exchange for lower utilization.  If that bonus is bigger than what you’d get from the utilization, then why would Medicare pay it?  If that bonus is LESS than what you are getting now, why would you do it?
  3. I have met newly elected Republican lawmakers of late and few of them are thinking that money will be saved with this approach.  As with other aspects of health reform law, they appear to be eager to… well, let’s just say…scrutinize the mechanics closely.

None of this is certain and there will be exceptions to all the rules anyone tries to write.  This leaves one thing certain.  Do NOT make multi-year investments that depend upon ACO actually happening.

So as far as ACO goes, pay as you go.

With me?

Jonathan Bush is the President and CEO of athenahealth.

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