Assisted Living Executive to Senior Living Executive

Interview:
ACO Advice
Should senior living providers look at accountable care
organizations as safe bets or sure losers?
An ACO expert attempts to answer that question.
By Bryan Ochalla

Twenty-two months after President Obama signed the Patient Protection and Affordable Care Act, physicians, hospitals, and other health-care providers—including those in the senior living space—are now free, per Section 3022 of that same health-care-reform law, to combine forces, create accountable care organizations (ACOs), and contract with the government to provide coordinated care to their many Medicare patients.

The question is: Will the above-men-tioned entities take their time jumping onto the ACO bandwagon or will they do so en masse and at the earliest opportunity? Erik Johnson, a senior vice president with Avalere Health, a Washington, D.C.-based advisory services firm that serves the health-care industry, doesn’t know the answer. But he hopes, for the sake of health-care providers and their Medicare patients, that the former scenario is more likely than the latter.

“The first time I ran a marathon,” John-
son says, “the best advice I got was: ‘If you
feel like you’re going slow during the race,
go slower.’ I think that’s the best advice I
can give to people who are looking down
this path, too.”
Johnson will be sharing his insights
into the potential (and potential pitfalls)

annual conference, taking place in Dallas May 16-18. He recently shared some thoughts with Senior Living Executive about why physicians, hospitals, and other health-care providers would want to set up ACOs and how folks in the senior living space, in particular, may benefit from becoming part of them.

SLE: Can you start by explaining what’s in it for hospitals? How do you see them benefiting, financially or otherwise, from setting up or joining ACOs?

Johnson: I think the decision a hospital faces in becoming an ACO—or not—is a little bit of a “be careful what you wish for” dilemma. That said, there are some theoretical benefits, too. One is that, if the ACO is established broadly enough in a geographic area, with lots of partnerships and collaboration, it can serve to capture volume and market share in a given area.

Second, if reimbursement continues its slow march toward incorporating more and more quality-based components to encourage behaviors that produce higher quality results, then the ACO construct offers health systems and their partners the opportunity to benefit from delivering higher quality.