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MEDICARE: What are advance payment ACOs?

There are 35 advance payment accountable care organizations (ACOs) — this article includes a list of all of them — that have been selected by the Centers for Medicare and Medicaid Services to participate in this experimental project.  Some of the ACOs are composed of small physician practices and an advantage of the program has been to provide smaller providers with the financial means to undertake improvements in patient care coordination.  If an advance pay ACO is successful in saving money through improvements in patient care, the federal government gets paid back on the start-up funds, then the ACO providers get to share in additional savings.  It is described in this article as a no-interest loan with no risk because if the advance pay ACO does not generate enough to repay the start-up funds, this will be written off.  Disadvantages of the advance pay ACO concept are also discussed.

Interesting fact:  ACO models currently involve 10 percent of Medicare beneficiaries.

Source: Fiegl, C.  Advance pay ACOs: a down payment on Medicare’s future.  American Medical News;, July 29, 2013.  Click here for free full text: http://www.amednews.com/article/20130729/government/130729938/4/   Posted by AHA Resource Center (312) 422-2050, rc@aha.org

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