5 Errors That Can Cripple an ACO

Accountable care organizations involve a lengthy to-do list, but it's still important for hospitals and physicians to know what not to do as they work to develop their organizations. Here are five mistakes that will make the challenge of ACOs and integrated healthcare more problematic.

1. Having few collaborative relationships or contracts with other providers. Hospitals most likely to struggle forming ACOs are those with disaggregated medical staff and a disaggregated marketplace. This might be a single hospital with a small medical staff that doesn’t have collaborative relationships with other community caregivers or is in a market with many competing, disaggregated organizations. While a healthcare provider may offer exceptional patient care, a major determining factor of success is now the relationships it holds with physicians healthcare organizations outside the hospital walls, such as outpatient clinics, palliative care and home care services.

2. Not shifting any attention or resources to preventive care. As populations receive more preventive care and maintenance, there may be reduced need for inpatient acute care. Hospitals with a tremendous amount of capital invested in acute care may face major financial and cultural shifts. Timing is also a challenge — a hospital doesn’t want to start easing back on critical care too soon, or it faces the entirely new dilemma of shortages. While a healthier patient population is certainly a wonderful problem, it raises fundamental questions over what hospitals may, or should, look like down the road.

3. Not considering ACOs and healthcare reform when designing a CEO succession plan.
There has been uptick in healthcare CEO retirements, and some attribute it to the new challenges hospitals face, such as ACOs. With changes ahead, many older CEOs who were part of a different approach to hospital management now perceive this as a good time to bow out. Hospitals should strengthen their CEO succession plan by considering leaders who would excel in this changing environment.

4. Relying on an ineffective physician relations program.
A physician relations program is one avenue hospitals can take to strengthen their relationships with physicians. Leaders of PRPs should have direct ties to CEOs and physician liaisons should have clinical backgrounds. Also, an effective PRP is business-savvy and connect the dots between revenue and physician behavior while establishing firm goals.

5. Not implementing readiness assessments to determine if the hospital is ready for ACOs.

A readiness assessment process is necessary to aid healthcare organizations in comprehensively evaluating their strengths and priorities as they progress toward accountable care. An ACO should be centered on providing an excellent patient experience, and it should produce outcomes that indicate they are controlling costs, and improving quality. The assessment must address these areas and more.

Read more about ACOs:

- 7 Observations on the Queens County Medical Association's All-Physician ACO

- 10 Recently Launched ACOs

- 6 Ways for Community Hospitals to Align with Physicians in Competitive Markets



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