Hospitals wary of ACOsNews added by Benefits Pro on December 13, 2013

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By Kathryn Mayer

Though many see accountable care organizations as the future of health care delivery, the trend might take a while to take off. That’s because hospital executives are increasingly wary of the model, with nearly half — according to a new survey — saying they have no plans to implement the model anytime soon.

That’s the story told by Purdue Healthcare Advisors, a health care consulting nonprofit, after talking with more than 200 health care executives.

Of the 46 percent who said they have no such plans, the majority said it’s because there are “too many unknowns” with the ACO model, and they first need “stronger evidence and a consistency of successful model.”

Other concerns? About half say their hospital is simply too small for such an operation, 26 percent say the financial investment outweighs the potential incentives or bonuses, 13 percent feel the performance benchmarks are not realistic for their hospital and 4 percent are concerned the transition would overwhelm staff.

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 by procedure. Groups receive a percentage of the savings they generate for Medicare as an incentive for keeping costs low.

The initiative is a critical component of the Patient Protection and Affordable Care Act.

Purdue Healthcare Advisors also concluded that “cost pressures for hospitals continue to mount due to diminishing patient volume, decreased reimbursement rates and the many unknowns associated with [PPACA].”

The survey found that 89 percent of executives are concerned with their hospital’s ability to address cost pressures. To combat financial concerns, 60 percent of execs say they’re focused on reducing waste and inefficiencies while 19 percent are considering staff and salary reductions. Another 15 percent said they are working to improve quality of care.

“This survey has identified a significant need for advocacy and education to support hospitals and help them survive the wave of changes brought on by the Affordable Care Act,” said Mary Anne Sloan, director of Purdue Healthcare Advisors. “Hospital executives are charged with enhancing patient care and managing margins with a shrinking workforce and diminishing patient volumes.”

Another part of PPACA — electronic health record implementation — is moving full-steam ahead for hospitals. Nearly all respondents (95 percent) said they’re implementing EHRs. Still, implementation isn’t without its concerns. Hospital execs said the biggest challenge facing implementation is physician adoption and usage, while they also expressed concerns over EHR interoperability, data retrieval and analytics, ongoing staff readiness and training and patient engagement.

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