The latest round of approvals in January brings the total of Medicare ACOs to 368, up from 235 in July 2013. Oliver Wyman has identified an additional 150 additional ACOs, bringing the estimated total to more than 520, up from 320 in July 2013 and 260 in January 2013. The numbers suggest that a fire has been lit—and it’s going to spread quickly. Our related research on ACOs includes:
ACOs Continue to Gain Ground
We currently count 522 ACOs in the United States, compared to 370 in September 2013 and 258 in February 2013. This number represents a 41 percent increase since September 2013 and a 102 percent increase since February 2013. The total number of patients served by these organizations is now between 46 and 52 million or roughly 15 to 17 percent of the population. Sixty-seven percent of the U.S. population currently live in a primary care service area (PCSA), compared to 45 percent in September 2013 and 52 percent in February 2013.
1What statistic says the most about where healthcare is headed?
We found that 67 percent of the U.S.population currently live in a primary care service area with an ACO, compared to 45 percent in September 2013 and 52 percent in February 2013. We regard this growing percentage as extremely important. ACOs need to be treated as a triggering mechanism for a revolution in American healthcare. Their reach is at least as important a factor to watch as their current enrollments.
2Why are enrollment numbers hard to pin down?
Current enrollments are problematic because most ACOs are currently at an early stage of development, offering care that differs very little from traditional healthcare providers. But the fact that they are reimbursed differently than traditional fee-for-service providers means that they can begin to profit from eliminating unnecessary services and replacing treatment with prevention—something fee-for-service providers cannot do.
3When will we see the kind of competition that leads to meaningful change?
Well, that’s the real question. ACOs were designed to create a new kind of competition that will drive the adoption of more effective, cost-efficient ways to deliver healthcare. New delivery models already exist, and they work, though they are not widespread and they have proven difficult to scale up. But now that two-thirds of Americans have access to an ACO and more than half have access to two or more, here’s a prediction: Once the fire is lit, it’s going to spread quickly.