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Getting the Big Picture on ACOs

August 24, 2010
by Mark Hagland
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Web-Exclusive Interview: Chet  Speed, Vice President, Public Policy, American Medical Group Association

One significant element in the comprehensive federal healthcare reform legislation passed by Congress and signed by President Obama in March (the Patient Protection and Affordable Care Act) was the inclusion of legislative language to support the development of accountable care organizations (ACOs) under the Medicare program. Physicians, physician groups, hospitals, and other patient care organizations will soon be given the opportunity to create collaborative organizations that will be able to accept unified payments for patient care that spans the spectrum of care. One organization that was deeply involved in initial proposals to Congress around ACOs during the months in which the healthcare reform legislation was being developed in Congress was the Alexandria, Va.-based American Medical Group Association (AMGA), whose 370 member organizations, which are larger physician groups and integrated systems, represent 109,000 practicing physicians nationwide.

AMGA’s vice president, public policy, Chet Speed, spoke with HCI Editor-in-Chief Mark Hagland recently regarding ACO development under healthcare reform, and the implications for CIOs and other IT leaders, as well as for executive and clinician leaders in patient care organizations more generally.

To learn more about AMGA’s ACO resources.

Healthcare Informatics: Where is your membership on ACOs right now, and what are you looking to accomplish?

Chet Speed: A little background. The ACO statute was largely based on a demonstration that CMS [the federal Centers for Medicare and Medicaid Services] called the Physician Group Practice (PGP) Demonstration. That demo included ten sites, including standalone groups, hospitals, MSOs [medical service organizations], etc.; and nine of those sites were AMGA members. And it focused on quality improvements, and on cost savings to the Medicare program. And the AMGA members were able to hit all the quality metrics and to provide multi-million dollars in savings to Medicare. So we had some of our members discuss their experiences with key Capitol Hill staff. And once the Hill staffers heard about those successes, they asked AMGA to draft a legislative proposal; and we provided a draft in January 2009; and it’s safe to say that that became a basis of the statute that came out. Obviously, Hill staff refined it, and CMS revised it. But AMGA was there at the beginning.

HCI: What kinds of things became very apparent in that demonstration project, and what were the key learnings?

Speed: Two things. One is, intense care management processes that involved really monitoring chronically ill populations and that provided critical interventions in a timely manner, led to success. And also, there is a significant IT component to care coordination or care management. And one of the things we learned during the demo and also through our membership, is that you obviously need an EMR; but the EMR can’t just be used as a record, but rather, must also be used as a data collection and analytical tool. Obviously, mechanically, to participate in an ACO, you need to report on measures. But the analytical part is clearly key to determining what’s going on with your population, and to improving their conditions. Obviously, you can find out that there are 30 primary care physicians in your group practice and 25 have patients with hemoglobin A1c levels that are 7 percent or below, and thus, they’re controlling their diabetes; but if you have an outlier patient of 9.5 or 10 percent, you can use analytics to find out why. And a key component of this is to find out why, and perhaps prescribe the medication earlier; or perhaps one physician is getting all the challenging patients because he or she is the best. And that allows you to reengineer your care processes to better treat the patients.

HCI: Was there a range of degree of success in the demo?