Medicare ACOs a Boon to Senior Care in State?

Don Crane is pretty happy. He’s president and CEO of the California Association of Physician Groups, and he’s been waiting for quite some time for federal officials to finalize the rules governing establishment of Medicare accountable care organizations.

The final regulations announced by CMS could be big news for California, Crane said.

“I think this is going to have a huge impact on the California health care landscape,” Crane said. “What this means is significantly more penetration of ACOs in the senior market.”

That’s especially important in California, according to Crane.

“California already built the infrastructure for providing service across the whole continuum of care,” he said. “So there will be far less capital required here. California is much better positioned [than other states] to build on an already robust platform.”

Hospitals and IPAs (independent physician associations) will now pursue the Medicare ACO model, he said, “but this is most attractive to physician groups, especially the most established ones.”

Most important, he said, is that California has the largest population of older patients in the nation — about five million seniors, and that figure is expected to increase dramatically in the next decade or so. The ACO model can only help them, according to Crane.

“They’re going to get much better care, profoundly better care,” Crane said. “When you look at utilization rates, there are much lower hospitalization rates in Medicare Advantage.” The seniors most likely to gain are those in traditional “regular” Medicare, Crane said, because they’ll have better care coordination and medication management.

“In California, about one-third of the seniors are in Medicare Advantage. Of the two-thirds outside of that, a significant percentage are duals [dual eligible patients who qualify for Medicare and Medi-Cal] and a large swath of the seniors are in original Medicare,” Crane said, “and those [two-thirds of seniors’ health] can be vastly improved by more care coordination.”

In the ACO model, CMS, providers and seniors stand to save money, Crane said. The final version of the ACO rules incorporated many of the stakeholder requests for greater flexibility and a more equitable division of those savings, he said.

Next week, the National ACO Congress holds its annual conference in Los Angeles. CAPG is one of the organizers of that event.