June 2011, Vol 3

Message From An Actuary
Tim Luedtke, FSA, CFA

This edition of The Actuarial View discusses a survey Navigator Benefit Solutions LLC is doing for the Delaware County Medical Socity on accountable care organizations. Should your organization have a similar need or wish to learn how you can leverage the opportunities found in the Patient Protection and Affordable Care Act please contact us. We are actuaries and understand the risks involved and the rewards you can achieve.

If you wish to learn more about health reform and how you can stay abreast of the new regulations, you may wish to consider adding to your health care reform knowledge base. Healthcare Visions, Inc. offers a Health Reform Navigator that will help make it easier for you to follow the law and all of the new regulations. If you wish to learn more, please go to Health Visions, Inc.. Or, if you'd like to see what others have to say about Navigator Benefit Solutions LLC, please see Love A Local Business.


Tim Luedtke, FSA, MAAA, CFA
Principal & Consulting Actuary

Diane Luedtke, FSA
Principal & Consulting Actuary

ACOs - Discovering The Physician's Perspective

Tim Luedtke, FSA, CFA

The objective of Accountable Care Organizations (ACO) is to redefine and achieve the 'Triple Aim' of improving population health, enhancing the patient experience, and lowering the growth rate of health care costs. When I talked with John Bertko, actuary, Visiting Scholar at the Brookings Institution and an adviser to the Department of Health and Human Services, Mr. Bertko indicated the desire is to meet this 'Triple Aim' by empowering and rewarding physicians, primary care in particular, who coordinate care for their Medicare patient populations.

In order to help the Delaware County Medical Society assess physician understanding of and interest in ACOs, Navigator Benefit Solutions LLC prepared and recently released a survey. The survey shared some new insights and opportunities created by the Medicare Shared Savings Program with several follow-on questions designed to assess current understanding of the physician community. Accountable Care Organizations are a hot topic with the local hospitals as each creates its own ACO and solicits participation from the local physician community.

Initial Thoughts

Participation so far has been too light to draw significant conclusions, yet wished to share some initial thoughts and encourage broader participation:

    1. Physician knowledge of ACOs is currently limited
    2. Local medical societies are viewed as an important information source
    3. Physician interest is greatest within the specialist community
    4. In the absence of any viable alternative, physicians believe that hospitals will be the most likely ACO organizer

ACO Challenges

Areas offering the greatest challenge to establishing an ACO by the physician community include:

    1. Creating the Legal and Financial Structure for an ACO
    2. Understanding and Managing the Risks Being Taken
    3. Maintaining Compliance and Working Within Government Regulations

Yet, the most significant challenge expressed within the initial responses is concern about being able to actually lower the cost of health care and create savings. Interestingly, in recent conversations I had with an early ACO adopter, generating savings is less of a problem than one might think. Savings were clearly achieveable and can be significant, yet there are clear winners and losers. And, physicians, with a strong support network of care managers, are often the leaders in bringing about these savings. Further, to remain competitive, hospitals must work closely with the physician community to improve their operations.

There is still time to participate in the survey and we request that you do. Your Delaware County Medical Society leadership really cares what you think and are using the results of this survey to help tailor their upcoming educational programs. With limited resources the Delaware County Medical Society wants to be sure to provide you with the educational opportunities you value.

You can find a copy of the survey here

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