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Obstacles to ACO (Accountable Care Organization) Development

Nov 29, 2012

Six barriers encountered during early stages of development of accountable care organizations….

Health care reform presents a unique opportunity for medical health centers to integrate systems of care, such as accountable care organizations (ACOs), but not without facing several barriers to implementation.


Alfred F. Tallia, M.D., M.P.H., and Jenna Howard, Ph.D., from the Robert Wood Johnson Medical School in New Brunswick, N.J., describe the ongoing efforts to develop an ACO at their academic health center, and the barriers encountered during this process.

The researchers report a three-phase approach to ACO development thus far. Stage one involved creation of a business plan, which was modified in stage two, following discussions with local physician organizations, insurers, government and business leaders, and national and local health care policy leaders. Stage three, which is ongoing, involved readying for implementation, mainly identifying funding for an integrated delivery system. Six main types of barriers were encountered during the ACO development: conceptual, financial, cultural, regulatory, organizational, and historical.

"Academic health centers such as ours have a unique opportunity now to reinvent themselves and lead the discovery and testing of new systems of health care organization and delivery," the authors write. "We have presented some of the challenges to our ACO formation and our ways of answering them, in the hope that other academic health centers can learn from our experience.

A new study by Oliver Wyman shows that accountable care organizations now cover up to 31 million patients, or about 10 percent of the nation’s population.

For a healthcare delivery model that came on the scene only two years ago, ACOs have made great strides in coverage in a short amount of time. While only about five percent of the country’s Medicare patients are covered by an ACO, many more non-Medicare patients are served by Medicare and non-Medicare ACOs alike.

The number of patients covered by ACOs is expected to rise in the future, with more organizations joining CMS ACO programs and becoming commercial ACOs.

The term "ACO" in the study covers all providers using population-oriented, value-based care delivery and reimbursement models.

Health Affairs, Nov. 2012 Abstract