In the latest issue of ACO Insights, Dr. Kent Bottles takes stock of the top four things we can say about the future of the American health care delivery system. The following is one of those points:


The healthcare industry passed the tipping point long ago and will continue to respond to healthcare reform and transformation, no matter what the politicians do or don’t do. In July 2012, HHS announced that 89 new Accountable Care Organizations (ACOs) had been accepted into the Medicare shared savings program; with 154 groups now participating in the federal program more than 2.4 million Medicare beneficiaries will be receiving care from these ACOs. Last year, with all the wrangling over the ACO regulations and uncertainty about the SCOTUS, many in the industry doubted that participation would be so robust. (


And ACO development is not confined to the federal program. Aetna, UnitedHealth Group, Humana, and many Blue Cross payers are crafting ACOs in the private sector. By one count with the newly announced federal participants, there are now 310 ACOs, in 45 states and the District of Columbia. Private sector activity is outpacing the federal programs by a factor of two to one.  ( The industry has accepted the PPACA as the law of the land, and almost all participants need the certainty associated with knowing the rules as we try to decrease per-capita cost and increase quality of the care we deliver to Americans.


This private sector’s embrace of the ACO model encouraged by the ACA is an important development. While Medicare and commercial ACOs both address the cost problem by eventually transitioning from fee-for-service to global payments, there are differences between the two ACO programs. Iowa Health System (IHS) CFO Kevin Vermeer recently discussed how the IHS/Wellmark commercial ACO program differs from the Medicare ACO:


  • Attribution model: the Iowa program attributes members to primary care only; the Medicare program could include specialists.
  • Quality indicators: Medicare has 33 quality indicators; the Iowa program has six quality domains.
  • Governance: Medicare ACOs have many more governance and administrative requirements than the Iowa program (


For the full article, as well as the issue, visit

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