Half of Americans live in ACO areaNews added by Benefits Pro on February 20, 2013

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By Kathryn Mayer

More than half of the U.S. population now lives in localities served by accountable care organizations and almost 30 percent live in areas served by two or more, according to new analysis from Oliver Wyman.

The total number of patients in organizations with ACO arrangements with at least one payer—both Medicare and non-Medicare—is now between 37 and 43 million, or roughly 14 percent of the population. That’s up from the consulting firm’s previous tally last fall, which was between 25 million and 31 million, about 10 percent of the population.

“For many people receiving care from one of these mixed-model ACOs, the shift to full participation in value-based care will be gradual and subtle as the contracts between the ACO and their insurance company migrate to ACO-style contracts,” says Rick Weil, a partner in Oliver Wyman’s health and life sciences practice group. “Over time, patients should notice that care gets more convenient, more proactive and more effective.”

Under the ACO model—which brings together groups of hospitals, doctors and other health providers to direct patient care—organizations are paid for caring for a pool of patients rather than for each procedure. Groups receive a percentage of the savings they generate for Medicare as an incentive for keeping costs low.

The latest round of approvals from the Department of Health and Human Services in January brings the total of Medicare ACOs to 259, up from 154 this past summer. The new additions contribute to a sharply rising Wyman potential level of influence for ACOs, Oliver consultants say.

“With the latest additions, more than half of the population—52 percent—live in primary care service areas served by ACOs, up from 45 percent this past August,” says Niyum Gandhi, an associate partner at Oliver Wyman. “The competition between ACO-based health care providers and traditional fee-for-service providers should give reform a good push forward. But even more powerful will be the competition between ACOs, which will give them the incentive to evolve as quickly as possible.

Oliver Wyman’s analysis numbers are based on the latest ACO figures from the U.S. Department of Health and Human Services.

Originally published on BenefitsPro.com
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