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Physicians' ACO Dilemma: Should We or Shouldn't We?

01/11/2011 / Todd Freeman

The Patient Protection and Affordable Care Act (PPACA) created a shared savings program under the Medicare system that is to commence no later than January 1, 2012. This program is designed to allow incentive payments to organizations that meet the requirements for an ACO in addition to the regular fee-for-service payments.

This provision of the PPACA comes on the heels of many efforts in the private market, both on the health plan side and the provider side, to assemble similar organizations for competitive purposes. Most of these efforts have been spearheaded by hospital systems, and physician providers have been aggressively recruited to join these organizations.

While the Republicans in Congress vow to repeal the PPACA, it is highly unlikely that the entire Act will disappear. Given that the shared savings program and ACOs are revenue raisers in terms of the federal government, the main argument to dismantle this part of the PPACA is the administrative burden that would be added to the health care industry. The shared savings program and ACOs have an excellent chance of being implemented, however, due to the prevailing view that there is much to be addressed and improved upon in the current health care market.

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