Shared Savings : An Approach To Healthcare Taxation Reforms : Case Study

The Patient Protection and Affordable Care Act (ACA) has created new forms of care organizations in order to provide better healthcare to Medicare and Medicaid patients at a greater value. The two types of organizations that this paper will focus on are Accountable Care Organizations (ACO’s) and Coordinated Care Organizations (CCO’s). There has been much information gathered regarding the similarities and differences between these organizations. This research has been conducted to better understand the way that ACO’s and CCO’s effect the hospitals, physicians, insurance providers, and patients involved in their implementation.

Healthcare is often driven by consumers and insurance companies; there is strong pushes for insurance companies to start paying better through Patient Care Medical Homes (PCMH) or Accountable Care Organizations (ACO) rather than paying at a per-visit basis (Hamlin, 2015). With PCMH or ACOs payment is made on a continuum of care, encouraging the provider to be involved in all aspects affecting health of the patient (Derksen, & Whelan,

Advance Payment Account Care Organization Model which focuses additional support to physician owned and rural providers participating in the Medicare Shared Savings Program by providing start-up resources to build better infrastructures throughout. The shared savings which the Accountable Care Organization (ACO) would be split in half and given back to the organization which provided the savings. In other words, in the case of my hometown hospital, if an ACO would take over and re-open our hospital, the predictions are that by retrieving these savings which are provided for by Obama-care, and by right-sizing our hospital from a 45 bed hospital to a 10 bed hospital and right-sizing the amount of employees, we would be back in the black within a 2 year period. That is a major step in financing this hospital to continue servicing a major part of the community which needs major health care to continue.

The Medicare Shared Savings Program was established by section 3022 of the Affordable Care Act and aims to improve beneficiary outcomes and increase the value of care by providing better care for individuals, better health for populations, and lowering growth in expenditures (Lieberman, & Bertko, 2011). The Affordable Care Act created ACOs, which is part of Medicare since January 2012, together with a Shared Savings Program it has the potential to lower costs, improve the quality of care, facilitate delivery system reform, and promote innovation in health care ( Lieberman, & Bertko, 2011).

​Kaiser Health News recently published an article on a new trend in healthcare. This trend introduces the Accountable Care Organization (ACO). The Centers for Medicare and Medicaid services defines it as “groups of doctors, hospitals, and other health care providers, who come together voluntarily to give coordinated high quality care to their Medicare patients” (“Accountable Care Organization,” 2015). According to the Affordable Care Act (ACA), the goal of the ACO is to be able to share health cost-savings with providers who are able to save money by eliminating unnecessary procedures and reduce health costs while increasing quality of care. ACOs make health professionals become more accountable in maintaining good-quality, coordinated healthcare for a patient through a value-based system that is evaluated through a number of criteria and benchmarks (Ronai, 2011).

The Affordable Care Act (ACA) legislated in 2010, has changed the United States health care industry. In addition to universal healthcare, one of the principles of the ACA is the ideal of accountable care. Specifically, adopting an Accountable Care organization (ACO) for Medicare beneficiaries under the fee for service program. An ACO seeks to hold providers and health organizations accountable for not only the quality of health care they provide to a population, but also keeping the cost of care down (1). This is accomplished by offering financial incentives to the healthcare providers that cooperate in, circumventing avoidable tests and procedures. The ACO model, seeks to remove present obstacles to refining the value of care, including a payment system that rewards the volume and intensity of provided services instead of quality and cost performance and commonly held assumptions that more medical care is equivalent to higher quality care (2) .A successful ACO model, will have developed quality clinical work and continual improvement while effectively managing costs, however this is contingent upon its ability to encourage hospitals, physicians, post-acute care facilities, and other providers involved to form connections that aid in coordination of care delivery throughout different settings and groups, and evaluate data on costs and outcomes(3). This establishes the ACO will need to have organizational aptitude to institute an administrative body to manage patient care,

The delivery system reform include: Mandates that the Secretary of Health and Human Services adopt value-based purchasing and payment methods for Medicare reimbursements for both physicians and hospitals. Creates incentives to reduce preventable hospital admissions. Creates a new Center for Medicare and Medicaid Innovation that will research, develop, test, and expand innovative payment and delivery arrangements. Encourages the formation of Accountable Care Organizations (ACOs) that allow hospitals and doctors to work together to manage and coordinate care and provides that these ACOs will receive a share of the savings they achieve for Medicare

Accountable care organizations are growing. Accountable Care or Coordinated Care is putting consumers at the front at our evolving healthcare industry. Accountable Care Organizations (ACO) strive to improve outcomes and reduce costs with improved patient care coordination (Robinson, J. C., Schaffer, L. D. 2015). Coordinated Care is defined as the Right care, at the right time, with no duplication, and to prevent errors. The Affordable Care Act encourages health care organizations to improve quality of care and reduce spending. In 2013, there were 320 ACO’s and as of 2014 there are now 700. 2/3 of the population now live in an area that services ACO’s. One out of three hospitals have ACO plans (Perficient Inc. 2015).

The ACA included reductions in Medicare payments to plans and providers and introduced delivery system reforms that aims to improve efficiency and quality of patient care and reduce costs including accountable care organizations (ACOs), medical homes, bundled payments, and value-based purchasing initiatives”(Cubanski & Neuman, 2016, p. 2).

Given huge potentials and resources, the healthcare system in the United States stands among the best in the world; however, it has been constantly plagued with issues of cost, access, quality and distribution.1 The national health expenditure levels on per capita basis as well as the percentage of GDP has for several years remained higher than other OECD countries but has in contrast, been ranked low on significant health indicators.1,2 As part of the ongoing healthcare reform efforts, the Affordable Care Act (ACA) was passed in 2010 which led to outright and possible immense changes in healthcare.1 Accountable Care organizations (ACOs) were presented as the healthcare delivery system signature of the ACA, as a novel Medicare payment model.3

There are three core principles to any ACOs. First, provider-led organizations with primary maintenance and a strong base are liable communally and total per capita costs for quality with full continuum for the population of care for patients. Second, excellent improvements will have linked to also have complete costs reduced, and third, progressively and reliable sophisticated measurement performance to improve, support, and provide the savings of confidence are achieved with improvements of care, , McClellan M, McKethan AN, Lewis JL, Roski J, Fisher ES (2010).

Shared saving program. Providers have objectives that they must overcome to determine how they are paid shared savings. Within the Shared Savings Program, providers of services that participate in an Accountable Care Organizations may be eligible to receive a shared savings payment if it meets requirements. These objectives are divided into four health categories. In those four categories, there are 33 sub categories. This means is that providers must achieve pass all varieties of quality measures that can range from patient satisfaction, care management or cost organization. Facilities that perform well on these qualifications are eligible for shared savings, if not they will not be eligible.

The American health care system has been victim to an escalation in the prices of health care services juxtaposed with inefficiency in delivery of care services. There has even been cases where State spending on the actual health care increased dramatically in the United States and one of the key components of curbing this problem which has been prevalent over the mass media and has been a major discussion among physicians is the advent of Accountable Care Organizations. Accountable Care Organizations (ACOs) is structured with the goal of trying to improve health care delivery and aid in the reduction of the overall cost of services (Weissert & Weissert, 2012). If there is insufficient coordination of high quality care delivery in the health care industry, this will have a negative impact on patient safety and diminish affordable care for patients. Hence, the development of ACOs is envisioned to be the savior of medical practices and can improve the overall fabric of the American society (Bresnick, 2013). ACOs serves as one of the answers for curbing the problem of high costs, low quality care and possible segmented delivery and as much as it serve as the major determinant for improvement in patient satisfaction, there are minor

The issue of healthcare personnel scarcity continues to be an ongoing challenge across the globe. Invariably, nurses are at the pinnacle in the delivery of quality care in any healthcare setting. The ever-increasing demands for care stem from a patient populace that is emergent, growing older and needing more care due to the escalating shift in their disease process. Hence, nurses are torn between balancing an overloaded schedule, working extra hours and maintaining astuteness and professionalism. This transcends to compromised patient care, nursing burnout makes it difficult for them to experience the rewards of caring for patients in the way they had expected; thereby, adding to the shortage of

Systems that have been adopted to date include: patient centered medical homes, episode based payments, global payments, shared savings programs, value based contracting, and population models which include accountable care organizations. In the patient centered home model the primary care physician coordinates the patients care and is rewarded for performance for improving quality and reducing costs for individual patients. Another value based system is a population model that include population health initiatives and reward providers for successfully improving the health of the entire population \cite{www-google-liason}. An example of this type of program is an Accountable Care Organization (ACO). In Accountable Care Organizations groups of doctors, hospitals, and other providers work together to provide coordinated care for Medicare patients. Providers share in Medicare savings with they deliver high quality care and