ACOs are 'far from proving their value'

Accountable care organizations (ACO) taking on a variety of forms are becoming more active in the healthcare landscape, but they’re far from proving their value, according to a report published by market researcher KLAS and consulting firm Leavitt Partners.

The assessment is based on a database of organizations identifying themselves as accountable care organizations collected by Salt Lake City-based Leavitt Partners and a 2011 survey of 200 providers conducted by New York City-based KLAS. While the Centers for Medicare & Medicaid Services counts 154 ACOs participating in its pay-for-performance programs, Leavitt Partners tallied 324, meaning more than one-half of provider organizations identifying as ACOs are a mix of health systems, physician groups, payers and employers. Approximately two-thirds of ACOs identified themselves as operational and another one-quarter expected to be operational within one year.

The report classified ACOs as “toe dippers,” “mainstream” and “forerunners.” Forerunners comprised 15 percent of all ACOs and were generally large integrated delivery networks that had long established control of the care continuum in the community they serve. Mainstream ACOs are comprised mostly of hospital-based systems, although physician groups are joining this category at an increased pace. A range of organizations represent the toe dipper category and generally offer ACO-like services on a limited basis.

All categories are investing in health IT, although their priorities diverge, according to the report. Toe dippers are currently focused developing data warehouses and acquiring business intelligence tools; mainstream ACOs are focused on standardizing EHRs and third-party health information exchange services; and forerunners are focused on developing in-house analytics capabilities for population health management.

There are few vendors that offer a robust set of tools that ACOs need, although Epic is furthest along in that area, according to the report. Additionally, there are no mainstream vendors offering sought after population management tools, which has “placed a spotlight on a group of vendors who specialize in population health, disease management, registries and care coordination.”

“Despite the great increase in ACO activity and claims of operational status, accountable care has a long way to go before approaches are normalized, technologies are mature and results are predictable,” the report concluded.

An executive summary of the report is available on the Leavitt Partners website.