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Health care leaders face a dearth of info

Rochester Business Journal
February 25, 2011

  A section of less than 10 pages in the 2,000-page Patient Protection and Affordable Care Act has gotten scant attention from the general public, but the health reform law's Accountable Care Organization provision has generated outsized attention and some consternation in the medical community.

  ACOs are supposed to provide a new model for care delivery. In the model, primary-care hospitals, doctors, surgeons and specialists would join forces in multilevel practices that would share risk with Medicare.

  If they practiced in vertically organized, multilevel groups instead of as unrelated, independent actors, reformist thinking goes, providers would be more likely to take a global view of patients and thus provide high-quality care at relatively low cost.

  Since the reform act's passage, ACOs have sparked a steady buzz of interest among providers. But as a deadline of Jan. 1, 2012, draws nearer for ACO implementation, few details have been forthcoming from the Centers for Medicare and Medicaid Services.

  The Monroe County Medical Society plans an ACO informational program March 2. It bills ACOs as "a key element of health reform (whose) impact on the practice of medicine should not be ignored."

  Still, an expert slated to speak at the event advises doctors to go slowly and not to assume they must join ACOs.

  A month or so ago, MCMS executive director Nancy Adams spoke tentatively of sending out feelers to area health systems about the possibility of joining with private-practice physicians to form an areawide ACO. The Queens County Medical Society was forming such an organization, and if systems' interest could be piqued, one might well work here, she said then. But for now she is talking about a more cautious approach.

  Representatives of Rochester's three main health systems have little to say about ACOs, pleading that they are largely in the dark about what ACO formation might entail.

  "There's been some stepping back to make sure what infrastructure is needed and what the cost of getting into it would be. Right now, there are a lot more questions than answers," said Diane Ashley, president and CEO of the local hospital group, the Rochester Area Healthcare Association Inc.

  A Healthcare Association survey of area providers last September found that 43 percent of area hospitals said they were investigating ACO formation, with interest skewed toward the larger institutions, Ashley said. More are probably looking into it now, she said. But like her own organization, most probably are more concerned about the prospect of Medicaid cuts by the state.

  In addition to the 2012 federal ACO implementation, state regulators are weighing a state version that could extend beyond Medicare, Ashley said. In either case, which groups might be eligible to form or run ACOs is not clear.

  ACO proponents cite results achieved by organizations such as the Geisinger Health System in Pennsylvania, the Mayo Clinic in Rochester, Minn., and Kaiser Permanente in California, which have long operated along lines described in the health care act's ACO provisions.

  Locally, the Greater Rochester Independent Practice Association, a physician group affiliated with Rochester General Health System, is organized similarly and boasts good clinical results and cost control. Members include private-practice doctors affiliated with RGHS and the system's employed physicians. Some doctors affiliated with Unity Health System are also members.

  GRIPA is looking at forming an ACO, board members of the roughly 800-doctor group recently told the Rochester Business Journal. Still, the association is moving cautiously and not yet sure how far it might go toward forming an ACO, said Joseph Vasile M.D., the group's president and CEO. Too much remains to be learned to make any commitment.

  One of two presenters scheduled to speak at the Medical Society's meeting, Michael Schoppman, is a partner of Kern, Augustine, Conroy & Schoppman P.C., a law firm focused on health care with offices in New Jersey, New York City, Long Island, Philadelphia and Chicago.

  A premature rush to join an ACO could leave doctors open to legal liability and substantial unanticipated costs, Schoppman wrote in a recent advisory for physicians. Doctors who join a poorly organized ACO could be hit with antitrust or fraud allegations, he warned.

  The Federal Trade Commission and the Justice Department have policed doctor groups in the past to keep physicians from agreeing on rates charged to third-party payers. In the FTC's eyes, such agreement constitutes price fixing. How antitrust laws might apply to ACOs is not clear, Schoppman said. Likewise unclear is whether the Health and Human Services Department would waive fraud and abuse laws that could conflict with ACOs.

  The FTC so far has allowed only three physician organizations to negotiate fees with payers. One is GRIPA, which invested some $2 million in computer hardware and software and spent more than a year dealing with the FTC to gain certification as a clinically integrated organization.

  Another ACO provision is giving pause to smaller Rochester-area health systems and hospitals, Ashley said. The act requires ACOs to have a minimum of 5,000 standard Medicare enrollees. But many local Medicare enrollees are signed with Medicare Advantage HMO plans such as MVP Gold, making that threshold impossible for all but the largest area health systems to reach.

  Still, Ashley added, given the advantages that might be gained, "ACOs are not something anyone can afford to ignore."

2/25/11 (c) 2011 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail

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