High-Functioning Rural Medicare ACOs – A Qualitative Review


Accountable Care Organizations (ACOs) are typically a group of physicians and/or hospitals that form an entity to deliver high-quality health care at lower-than-predicted cost. In the Medicare Shared Savings Program (SSP), Medicare shares any expenditure savings with the ACO. Since not all ACOs deliver expected clinical quality and/or cost-savings, it is important for ACO stakeholders and policymakers to understand and support common ACO success factors likely to inform further ACO-success policy and strategy development.

The RUPRI Center placed 16 rural Medicare ACOs in financial-performance and quality-performance quartiles. Four rural Medicare ACOs that performed in the third or fourth highest performance quartiles were selected for qualitative study via structured interviews. The four ACOs included Chautauqua Region ACO (western New York state), Maine Community ACO (northeastern Maine), Mercy Health ACO (southwestern Missouri and Arkansas), and North Country ACO (northern New Hampshire). Interviews inquired about governance, ACO history, operations, finances, population health, and lessons learned that might benefit other ACOs.

Based on transcribed interviews and contemporaneous notes, the authors identified six common rural Medicare ACO success factors: 1) prior collaboration experience, 2) volume-to-value transformation strategic focus, 3) clinician championship, 4) shared governance, 5) care coordination services, and 6) data access and analysis.

Both federal policymakers and commercial payers see potential value in ACOs to improve clinical quality and reduce expenditures. Thus, ACO characteristics associated with improved ACO performance and success should be of interest. The authors recommend consideration of the following policies: 1) renew and expand the ACO Investment Model, which previously increased rural ACO participation in the SSP and netted Medicare savings; 2) encourage organizations with prior multiorganizational collaborative experience to participate in shared-savings contracts; 3) establish new accounting and financing models that blend fee-for-service, shared savings, and capitated revenue streams to better assess financial risk; 4) promote care coordination and other population health improvement strategies; and 5) provide accurate and timely data analysis that assists providers identify high-need/high-cost patients, highlight preventive health opportunities, and address social determinants of health.

RUPRI Center for Rural Health Policy Analysis
Thomas Vaughn, Keith Mueller, A. Clinton MacKinney