In the following column, attorney Richard Cowart examines how some specialties may form their own accountable care organizations. To read the latest on ACOs, download the March issue here

In today’s world, the basic organizational paradigm for health care is medical specialization. Many specialists, such as internal medicine, have significant bandwidth. Other specialists like ophthalmologists focus on specific areas of the human anatomy. Most discussion of Accountable Care Organizations (ACOs) centers around “shared savings” by focusing on care for community-wide populations, groups that, by their very nature, are multi-specialty in need. However, there is increasing interest in whether there is a place for single-specialty ACOs.

In the 1990s when integrated delivery systems were in their formative state, capitation was a frequent form of payment. Specialty groups were not in a position to accept full risk, and the concept of “sub-capitation” or “carve-outs” emerged. For example, a retina surgeon in Georgia agreed to accept a carve-out for Medicare ophthalmology on a per member, per month rate. The Georgia practice became responsible for all the primary, secondary and tertiary ophthalmic care, and added or contracted with optometrists, ophthalmologists and other eye care professionals to care for the population. However, the retina practice was at full risk for the favorable or unfavorable consequences.

Likewise, we could see ACOs develop around single specialty models or agree to a “sub-sharing” model for a community ACO.
Recently it was reported that US Oncology is analyzing whether to launch a national Medicare Oncology ACO. The ultimate launch will depend on the final federal regulations. The statute requires an ACO to have at least 5,000 patients, and presumably 5,000 cancer patients would satisfy that requirement. However, such critical mass would mean that any single-specialty ACO is likely located in a metropolitan area and must find a way to coordinate with other multi-specialty ACOs in the area. ACO shared savings will, of course, be potentially dispositive of this issue. However, with more than 850,000 patients and 500 sites in 39 states, US Oncology would be in a position to consider multiple market opportunities.

Similarly, AmSurg is the nation’s largest owner and operator of endoscopy centers. With more than 200 outpatient surgery centers in 33 states, nearly 20 percent of the nation’s endoscopies are performed at AmSurg Centers. It would be incumbent on someone in such an enviable market position to asses whether or not there is a role for single-specialty ACOs that focus on colon cancer in a state or region.

ACOs remain on the radar screen for virtually every type of healthcare organization, whether large or small, provider or payer. It will be interesting to see if there is a place to play for the single specialties that have proven to be very efficient providers of health care services.

Richard G. Cowart, Chair Health Law and Public Policy Department; Baker, Donelson, Bearman, Caldwell & Berkowitz; dcowart@bakerdonelson.com

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