Is It Profitable to be an Accountable Care Organization?

Posted onCategoriesMedical

An Accountable Care Organization (ACO) is a healthcare system that provides complete, all-around coverage to its patients. An ACO works across different departments to provide the most extensive and efficient care to the members of its network. They cover all specialties, which all fall under the same organization and work with the same non-healthcare departments, such as accounting, legal, human resources, etc. An ACO is a full system of care for its clients.

image courtesy of freedigitalphotos.net/photostock
image courtesy of freedigitalphotos.net/photostock

Rather than a client going to a primary care physician, who might then recommend they go to a specialist in a whole other practice, that specialist would work together with the primary care physician, under the umbrella of the same organization. This alleviates the potential for errors and higher costs when insurance won’t pay for out-of-network providers.

The different departments and specialists work together to provide the most complete, non-duplicative and efficient care. When all the doctors, nurses and specialists who are working on the same patient communicate with each other, the organization as a whole eliminates a lot of wasted time, wasted money, wasted resources, and waste in general. It is a way to give patients the best care, at the lowest cost.

With an ACO, this is done for every patient enrolled with the organization. It promotes teamwork across departments, and encourages healthcare organizations to give patients the best possible care.

While it seems like a no-brainer to be an ACO, starting one up can be a bit costly and burdensome for a new or small organization, at least in terms of profit. In the long run, operating as an ACO should save an organization money. Be aware that it will take time to get it running due to the fact that implementation isn’t simply loading a program on the system for everyone to follow.

ACOs fees are based on the care given, not based on each service performed. This is a newer trend in the healthcare industry and one that most organizations will be following sooner rather than later. The change in the way fee are expensed places more risk in the hands of the health experts, but provides a more streamlined path for care.

image courtesy of flickr.com/KoolCatsPhotography
image courtesy of flickr.com/KoolCatsPhotography

This is not as big an issue for large organizations with many patients, as their cost savings versus what they lose by not being fee-for-service should even out. On the other hand, for smaller organizations, this is a hard thing to implement because by not charging for each service, they may be losing enough money that it’ll be hard to be profitable in the beginning. While that may not be beneficiary for the small healthcare organization, this type of organization and pay model would almost always benefit the patient. The patient is only paying for his or her care, not for each treatment.

In the end, the ACO model is a good one to strive for, and one that the Affordable Care Act has fully backed, and even provides incentives for. Hopefully with the help of the government, even smaller organizations can adopt this sort of care for their patients.