The engine behind ACOs is showing its muscle

James M. Berklan
James M. Berklan

The American West was largely settled by pioneers in covered wagons. It looks like a couple hundred years later, the American healthcare landscape is going to be infiltrated by covered Pioneers.

And this wagon train is only picking up momentum.

The covered entities would be long-term care and other providers who climb onto the Pioneer model, and other accountable care vehicles. Federal health officials are really putting their shoulder into pushing alternative pay models like these and it looks like there's no turning back.

The Pioneer ACO is federal officials' baby, so it would get preferential treatment anyway. But then came Monday's announcement that instead of saving the system almost $100 million, as the administration had hoped, it had actually saved more than $385 million.

What better justification could one have for announcing the program's expansion? Not much.

So it appears that even though the program of wunderkinder has suffered an occasional image problem — a 40% dropout rate will do that — there's enough promise for the feds to increase their bet.

Tweaks to the program should only help expansion. What's more, regulators announced they also will be adjusting the much more widely adopted Medicare Shared Savings Program.

Add all this to the recent announcement that a new ACO model, the Next Generation, will be kicked into gear soon and, hey, the covered wagon could be turning into a crowded bandwagon soon.

Of course, actual conversion rates to ACOs are still relatively low at this point. But don't kid yourself. Leading long-term care providers around the country already have been quietly forming the kind of new ACO relationships that regulators want. Providers who desire economic viability in the future will face increasing pressure to do so.

There are about 600,000 Medicare beneficiaries currently covered under the Pioneer ACO model. Prepare to see that number soar, along with enrollment in other ACOs.

James M. Berklan is McKnight's Editor. Follow him @JimBerklan.

Daily Editors' Notes

McKnight's Daily Editors' Notes features commentary on the latest in long-term care news and issues. Entries are written by Editorial Director John O'Connor, Editor James M. Berklan, Senior Editor Elizabeth Newman and Staff Writer Emily Mongan.

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