New Calif.-Based ACO Aims To Improve Care at Rural Hospitals
A new Nevada City-based accountable care organization is working to expand care to residents in rural areas of California by offering low-cost membership to rural hospitals, Payers & Providers reports (Shinkman, Payers & Providers, 2/6).
ACOs are networks of physicians, hospitals and other providers who partner with payers to coordinate care for a defined group of patients. Under agreed-upon terms with payers, including private insurers and Medicare, providers must meet quality and performance targets in exchange for shared savings for the cost of delivering care (Vesley, California Healthline, 8/15/13).
Under Medicare Shared Savings Program guidelines, ACOs are required to serve a minimum of 5,000 patients, which can be difficult for many rural facilities. In addition, rural health care facilities often find it challenging to raise the average $1.7 million in start-up costs for an ACO, according to Payers & Providers.
Details of New ACO
The new ACO -- known as the National Rural ACO -- is based in Nevada City and includes five hospitals and health systems from California:
- John C. Fremont Healthcare District in Mariposa;
- Mammoth Hospital in Mammoth Lakes;
- Northern Inyo Hospital in Bishop;
- Ridgecrest Regional Hospital; and
- Southern Inyo Healthcare District in Lone Pine.
The ACO also includes four hospitals in Indiana and Michigan.
According to Payers & Providers, the National Rural ACO is attractive to rural hospitals because it limits membership costs to:
- A $20,000 application fee; and
- $10,000 in monthly dues.
Lynn Barr, founder of National Rural ACO, said, "This was an effort to create a scale to make this work, to create an ACO-in-a-box model that everyone can use." She added that the new ACO enables rural hospitals to "get all the benefits of an ACO but without having to put up the enormous sums of money required to start on up."
According to Payers & Providers, 250 to 3,500 patients at each hospital will participate in the ACO.
Barr projected that the National Rural ACO will include hospitals and health system in 10 or more states by 2015.
The organization will focus on treating patients who:
- Regularly use hospital emergency departments for care; and
- Frequently visit the hospital for treatment of chronic conditions, such as diabetes and heart failure.