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ACO’s and the Medscape Compensation Report

Physician Compensation and ACO'sThe times are a changin’, and this year’s Medscape Compensation Report proves it. The annual report crunches data from more than 24,000 physicians from 25 specialties around the country, and provides a snapshot of the state of physicians’ practices in terms of compensation, number of hours worked, practice changes resulting from healthcare reform, as well as adaptations to the new healthcare environment.

And by the healthcare environment, I mean ACO’s, those health care provider groups who agree to take on a shared responsibility for the care of a defined population of patients. Their goal? Make sure their patients get the right care at the right time and avoid unnecessary duplication of services and prevent medical errors. If they do a good job, they get to share in those cost savings.

Three years ago, almost nobody participated in an ACO. Those 3 percent of physicians who did participate were ahead of their time, considering that a full 30 percent did last year. Expect those numbers to climb as another 7 percent reported they intend to join an ACO in 2015.

Jump on the Bandwagon

The case for doctors to participate in an ACO is a compelling one. Charles Kennedy, an internal medicine physician, and CEO of Aetna Accountable Care Solutions, makes this argument: “The compensation models actually give physicians more control over the care model they want to create – spending more time than they currently spend addressing patients’ health care needs before they become ill. The emphasis on preventive care and patient outreach should lead to more satisfied patients over time, while at the same time providing greater financial gains to those physicians whose care models result in better overall patient care.”

Not so Fast

Still, plenty of doctors haven’t joined ACO’s, and a number of them don’t plan to. Reasons vary, but Dr. Gene Overholt, a gastroenterologist with Knoxville, TN-based Gastrointestinal Associates PC, says he won’t recommend that his group join an ACO for several reasons. He compares ACO’s to yesterday’s HMO’s, with too many gatekeepers and patient care being controlled by outward forces. Few doctors want more intrusions into the way they practice. “Under many of the ACO models, specialists will, at least in part, lose the control of patient care we have today. I am not convinced at all that will lead to better quality of care.”

In addition, states Overholt, ACO’s are no way a guaranteed financial boon. “The economics from one ACO to another are so variable that specialists should be very wary of the financial risks.” Overholt goes on to say he would rather be a referral for ACO’s and targets these groups with specialized bundling process for procedures. The financial piece is uncertain. After all, in the first year of the Medicare ACO program, just 29 groups generated enough savings to qualify to keep some of it.

Now what?

It’s too soon to tell what the next few years will look like for ACO. With more than 65 key quality metrics, ACO’s will be a demanding mistress. That being said, there is money to be made. One of the best-performing early ACO’s was Montefiore ACO in the Bronx, New York, which reported savings of $23.3 million, or 7.1 percent, and $14 million in shared savings in one year.

With money like that on the table, don’t expect interest to wane anytime soon.


Medscape Compensation Report


One doctor explains why his physician group won’t join an ACO

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About Angie Best-Boss RN

Angie Best-Boss, ASN, BA, MDiv is a psychiatric nurse and freelance writer from the Indianapolis, Indiana area. Angie has three daughters and can usually be found with her nose in a book, crafting or, in warm weather, geocaching.