Health Care
FAQs about ACOs and Local Medical Group Partnerships
By Gregory Roberts July 6, 2011
Frequently Asked Questions
What is an ACO?
An organization of health care providers that agrees to be
accountable for the quality, cost and overall care of Medicare beneficiaries the government
assigns to the organization.
What is the advantage of an ACO?
If an ACO meets specified quality standards, it is eligible to
receive a share of any savings that result from its ability to reduce per-capita expenditures below a particular benchmark.
Where will cost savings come from?
More than 75 percent of health-care spending is related to caring for patients with such chronic diseases as asthma and diabetes. By giving these patients comprehensive care that
addresses such issues as diet, experts believe health-care providers can reduce expensive acute care in the hospital setting.
What companies or institutions will benefit?
Networks of institutions that can handle most of a diabetic patients needs, from diet consultations to orthopedic care, for example, would be best positioned to reduce costs and get a share of the savings. To manage the care, these institutions will require the ability to share electronic medical records, creating opportunities for companies like Microsoft, which provides software and services to health-care institutions.
Medical Group Partnerships in Washington
Health care providers that already have large networks connected by electronic medical health record systems will be best positioned to create an ACO. In Washington state, the move toward consolidation among health-care providers has been accelerating, as illustrated by these examples.
GROUP HEALTH COOPERATIVE
GHC, which already behaves much like an ACO, is expanding its network and seeking to extend its approach to other hospitals with which it has strong relationships, such as Overlake, Virginia Mason, Harrison Memorial, Providence Everett, Providence St. Peter, The Everett Clinic, St. Joseph Tacoma and Sacred Heart Medical Centers.
New: In 2011, GHC reached an agreement to acquire Columbia Medical Associates in Spokane. It also entered into a memorandum of understanding with the Providence Health system to collaborate on the development of an innovative health-care system to serve eastern Washington and northern Idaho.
Electronic medical records: Group Health was one of the first to develop a comprehensive electronic records system, which is in the process of being extended to many of its partners.
SWEDISH MEDICAL CENTER
The system grew by absorbing Ballard Community Hospital in 1992, acquiring Providences Seattle hospitals in 2000 and opening a new hospital in Issaquah this year. It now has five campuses and roughly 40 specialty and primary care clinics.
New: Last year, Swedish merged with Stevens Hospital in Edmonds. It is exploring relationships with Olympic Medical Center in Sequim, Forks Community Hospital and Jefferson Healthcare Hospital in Port Townsend.
Electronic medical records: Swedish recently completed its Epic medical record system, and has implemented it at The Polyclinic and at Minor & James Medical, a multispecialty physicians clinic in which it owns a share.
UW MEDICINE
UW Medicine operates seven neighborhood clinics in Seattle and is planning to open two more. The group includes the 1,800-member UW Physicians doctors group, the UW School of Medicine, the Airlift Northwest medevac service, and the hospitals of the UW Medical Center and Harborview Medical Center.
New: In 2010, Northwest Hospital, a community hospital in Seattle, became part of UW Medicine. UW Medicine also is talking with Valley Medical Center in Renton about an affiliation.
Electronic medical records: UW Medicine has a new $50 million called CHARM (Clinic and Hospital Access and Revenue Management) system that includes Harborview, Seattle Cancer Care Alliance and UW Medicine, and will be extended to all partners. UW Medicine is working with Microsoft to increase the capabilities of its medical records system.