Compensation structure for docs in ACOs similar to non-ACO physicians

Primary care physicians working in accountable care organizations (ACOs) received around half of their compensation from salary, according to an analysis of a physician practice survey administered in 2012 and 2013. Only 3.4 percent of their compensation was based on the quality of care they delivered.

After adjusting for multiple variables, physicians participating in ACOs had similar compensation structures compared with those who were not in ACOs and did not have substantial risk for primary care costs.

Lead researcher Andrew M. Ryan, PhD, of the University of Michigan, and colleagues published their results in the July/August 2015 issue of Annals of Family Medicine. The Robert Wood Johnson Foundation funded the study.

ACOs were created as part of the Patient Protection and Affordable Care Act, which President Barack Obama signed into law in March 2010. Under the Medicare ACO model, provider organizations are responsible for the costs and quality outcomes of patients. The providers work together in a team, and primary care physicians coordinate care for patients in conjunction with specialists, nurses and others.

In this analysis, the researchers evaluated 632 physician practices that participated in the National Survey of Physician Organizations between January 2012 and November 2013.

On average, primary care physicians in ACOs received 49 percent of their compensation from salary, 46.1 percent from productivity, 3.4 percent from quality and 1.5 percent from other factors. The percentages were similar to physicians who were not in ACOs and did not have substantial risk for primary care costs.

Meanwhile, physicians that were not in ACOs but had substantial risk for costs received 66.6 percent of their compensation from salary, 32.2 percent from productivity, 0.8 percent from quality and 0.4 percent from other factors.

The researchers defined “substantial risk” as practices that had some financial risk for all of their health maintenance organization and point-of-service patients.

Of the practices analyzed, 76.1 percent did not participate in an ACO and did not have substantial risk for primary care costs, 21.1 percent participated in an ACO and 2.8 percent did not participate in an ACO but had substantial risk for primary care costs.

Although ACOs can manage costs through electronic health records, internal reports on physicians’ performance and coordination of care for high-risk patients, the researchers said it was unclear if ACOs would be effective at reducing costs while improving the quality of care.

“The incentives for ACOs may not be sufficiently strong to encourage practices to rapidly and substantively change their physician compensation policies to create incentives for better patient experience, improved population health, and lower per capita costs,” the researchers wrote. “If physicians in ACOs and physicians outside ACOs are paid similarly, will they practice differently? The ACO experiment is new, and it may take some time and experimentation for practices to shift toward the most effective compensation policies for their physicians.”